On November 3, 2025, the United States District Court for the Western District of Michigan preliminarily approved a class-action settlement valued at approximately $9 million in debt reductions, credits, and payments to over 5,200 Michigan consumers who were overcharged interest on judgments entered against them. Final approval of the settlement is set to be heard by the court on March 9, 2026.

Westbrook Law PLLC brought the case, VanderKodde v. Mary Jane M. Elliott, P.C., against two of the largest debt buyers in the nation, LVNV Funding and Midland Funding, and the collection law firm that represented them, in 2017. The complaint alleges that while Michigan law allowed judgment interest ranging from 2-4% during the relevant time period, the defendants calculated judgment interest at an unlawfully high 13% rate and proceeded to collect the excess interest from consumer debtors through garnishments of bank accounts and tax refunds. The lawsuit alleged that this practice violated the federal Fair Debt Collection Practices Act (“FDCPA”) and Michigan state debt collection laws.

The parties have agreed to a settlement that recalculates all class members’ judgment balances based on the lawful interest rate, a reduction of approximately $7 million, and further reduces each class member’s balance by $500, totaling over $2 million. Class members whose judgment balances are eliminated by these reductions are entitled to an additional payment of $150 each. In the settlement, the defendants also agree to pay the attorney fees of class counsel and the costs of administering the settlement.

Class action settlements are subject to court approval for fairness, and the court’s preliminary approval is the first in a two-step approval process. The court’s November 3, 2025 order reflects its conclusion, based on the parties’ submissions, that the proposed settlement is fair to the class members and that class counsel and the named plaintiffs have acted in the best interests of the class.

After more than eight years of hard-fought litigation, the class settlement in VanderKodde comes as a welcome victory for Michigan consumers.

TJW