The class has been certified in a class action against debt collection agency Allied Interstate, Inc. on behalf of all persons with Illinois addresses who, on or after February 10, 2002, have been sent a collections letter regarding an unpaid residential telephone service debt that offered to settle the debt at a 50% or greater discount by the agency, but contained a purported deadline for payment. The action alleges that the company violated the federal Fair Debt Collections Act by making bogus "one-time" settlement offers to debtors. The action seeks compensatory and punitive damages, and an order prohibiting Allied from sending the allegedly deceptive letters to Illinois addressees.

The action alleges that Allied, which is part of IntelliRisk Management Corporation, misled named plaintiff Elle Seidat to believe that her debt would be settled upon paying 70 percent of what she owed when, in fact, she still would owe the other 30 percent to AT&T. Ms. Seidat alleges that Allied sent three letters to her between June and September 2002, each of which offered to "settle" her account for 70 percent of the outstanding balance.

In addition to allegedly misleading Ms. Seidat about the effect of a 70 percent payment, the action also alleges that the letters contained fictitious deadlines intended to mislead her into believing that she would lose the opportunity to settle the debt for a 70 percent payment if the stated deadline passed.