Debt Buyer Loses Collection Case Appeal Over Wikipedia Page

An appeals court in New Jersey has overturned a $17,500 judgment against a debtor because the collection law firm that originally won the case admitted a page from the Web site Wikipedia into evidence.

A panel of appellate judges in the Superior Court of New Jersey – Appellate Division said in their opinion dated April 17 that Wikipedia is a “malleable source of information” and that it is “inherently unreliable.”

The case involved a debt collection action brought on behalf of debt purchaser Palisades Collection, LLC against Steven Graubard. Palisades’ legal representation claimed that Graubard owed $30,500 on a credit card account he opened in 1999 with Chevy Chase Bank. After a series of bank mergers, the account ended up with JP Morgan, who sold it to Palisades.

After a communication from a law firm representing Palisades in February 2006, Graubard said that he was disputing the validity of the claim because, to his knowledge, he had “never been granted credit by the original creditor named in your notification.” The law firm filed suit in May 2006.

At the trial, the collection attorneys attempted to prove the chain of title of Graubard’s account. According to the court records, the plaintiffs contended that Chevy Chase’s credit card operations had been purchased by Bank One, Bank One was subsequently purchased by JP Morgan, who then sold the account to Palisades. To prove that the mergers and acquisitions had taken place, lawyers for Palisades admitted into evidence an article from the New York Times and an entry from the online encyclopedia site Wikipedia.

The trial court agreed with the plaintiffs and awarded Palisades a judgment of $17,500, after the judge said that the debt buyer could not prove why the credit card balance had grown to $30,500.

On appeal, attorneys for Graubard argued that Palisades did not have standing to prosecute the claim, as Graubard had never owned a Chevy Chase credit card. They argued that the articles submitted by Palisades’ attorneys did not prove the chain of title.

The appellate panel agreed and reversed the original decision. In the opinion, they wrote that Wikipedia is a “malleable source of information [and] is inherently unreliable, and clearly not one ‘whose accuracy cannot be reasonably questioned.’ Purged of this inadmissible material, plaintiff has not produced sufficient evidence to show it has the right to collect this claim from defendant.”

Palisades can appeal the decision. Attempts to reach both law firms involved for comment were unsuccessful.

For his part, Graubard conceded to local paper The Record that he is not disputing that he had a credit card and made the charges in question. "This entire case is about the chain of title on the debt,” he told the paper.

Read the appellate court’s decision here.