MTA To Rein in Unfair Collection Practices Under Settlement in Federal Class Action Challenging Systemic Violations of Low-Income New Yorkers’ Civil Rights

CONTACT:
Susan Shin, Legal Director, New Economy Project | susan@neweconomynyc.org  
Patrick Fowler, Communications Strategist, NCLEJ | fowler@nclej.org 
Claudia Wilner, Director of Litigation and Advocacy, NCLEJ | wilner@nclej.org 

NEW YORK – A federal court granted preliminary approval of a settlement in a class action lawsuit charging the New York City Transit Authority (NYCTA), an arm of the Metropolitan Transportation Authority (MTA), with aggressively going after thousands of New Yorkers for alleged debts in violation of their constitutional due process rights. Under the settlement, the NYCTA will improve notice and disclosure and provide access, for free or at reduced cost, to crucial information so that New Yorkers—including homeless New Yorkers, people of color, and others disproportionately targeted for transit infractions—can meaningfully assert their rights. 

You can read about the basic terms of the proposed settlement here.

Filed in February 2019 in the Southern District of New York by New Economy Project, the National Center for Law and Economic Justice, Faegre Drinker Biddle & Reath LLP, and the Law Offices of Gerald S. Hartman, the lawsuit challenges the NYCTA’s seizures of New Yorkers’ state tax refunds to collect on default judgments for alleged transit rule violations—some going back 20 years or more—without legally-required notice or opportunity to review even minimal documentation about the alleged violations. A federal judge certified the class action in October 2020. 

Under the agency’s prior procedures, New Yorkers often could not obtain copies of any ticket they had allegedly received, called a Notice of Violation, or related documents concerning the alleged transit rule violations. The agency also concealed its criteria for undoing, or vacating, default judgments, leaving New Yorkers in the dark as to what information they needed to meaningfully challenge a default judgment or tax refund seizure. The settlement will significantly enhance fairness and due process at the agency by making such documents and information readily available to New Yorkers. 

“The MTA had no right to take my tax refunds without giving me a chance to defend myself,” said David Evans, a disabled Marine Corps veteran and named plaintiff in the lawsuit. “I brought this lawsuit so the MTA would stop doing this to New Yorkers.” Both Mr. Evans and the other named plaintiff, Nathaniel Robinson, are African American and formerly homeless.  

“Our lawsuit shined a light on the racial and economic injustice caused by the MTA’s Kafkaesque debt collection system, which reinforced the racial impact of discriminatory policing in low-income Black and brown neighborhoods and punished people for being poor,” said Susan Shin, Legal Director at New Economy Project, which has helped dozens of low-income New Yorkers—mostly Black and brown New Yorkers—challenge the agency’s seizures of their tax refunds, including during the COVID-19 pandemic. “This settlement agreement will restore basic due process rights and should be seen as an important first step toward ending the MTA’s predatory debt collection practices.” 

“We are pleased that the court has approved this preliminary settlement,” said Claudia Wilner, Litigation and Advocacy Director for NCLEJ. “Our lawsuit was about holding the NYCTA accountable for their due process violations against low-income families, people of color, and people experiencing homelessness. When State agencies try to extract wealth from the people who can least afford it, the most vulnerable within our society, they succeed only in destroying lives and robbing communities of the chance to thrive. This agreement will ensure that the NYCTA provides the public with the opportunity to get copies of their tickets and other critical documents so that they may challenge any unjust practices.” 

Under the preliminarily approved settlement, the NYCTA has agreed to: 

• Post information prominently at its Transit Adjudication Bureau (TAB) office and online on how to request a copy of a Notice of Violation (NOV) in one’s name, along with related information. 
• Provide certain information, including an NOV Status Letter and a Payment Status Letter, upon request and without charge, and continue its policy, adopted during the litigation, of charging no more than $1 per copy of an NOV (reduced from $10 per copy). 
• Publish a complete list of its “good cause” criteria for vacating default judgments and update its guidance to its hearing officers on what constitutes good cause for vacating default judgments. 
• Cease enforcement of a default judgment, vacate the default judgment, and dismiss the underlying NOV if TAB is unable to locate the NOV within 60 days of a request for a copy. 

New Economy Project works with community groups to build a new economy that works for all, rooted in racial and social justice, cooperation, neighborhood equity, and ecological sustainability. New Economy Project’s work focuses on campaigns to challenge corporations that harm communities and perpetuate inequality and poverty, and on efforts to build strong local economies, by fostering democratically structured, community-controlled initiatives such as worker cooperatives, community development credit unions, community land trusts, and mutual housing. 

The National Center for Law and Economic Justice is a legal nonprofit organization that advances racial and economic justice for low-income families, individuals, and communities across the country through ground-breaking impact litigation, policy advocacy, and support for grassroots organizing. Founded in 1965, NCLEJ fights to protect access to critical benefits like food stamps, Medicaid, and childcare, protect low-wage workers’ rights and safety, advocates for the rights of people with disabilities, and fights unlawful debt collection. 

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