Maryland residents who were part of a class-action lawsuit against several collection agencies will have their debts erased and lawsuits against them dropped, according to terms of a settlement.

The defendants include a group of collection agencies - Worldwide Asset Purchasing LLC, Worldwide Asset Purchasing II, West Receivable Services Inc. and West Corp. Worldwide and Worldwide II are subsidiaries of West Receivable, and West Receivable is an arm of West Corp.

The four collection agencies were pursuing debts that were often beyond the statute of limitations or were previously discharged in bankruptcy. The agencies also were not registered or licensed in Maryland, according to court documents. The plaintiffs alleged that the agencies disclosed personal information of consumers, including Social Security numbers.

The class, represented by Maryland residents Wilson C. Winemiller Jr., Warren P. Adams and Mickey S. Slaghter, also will receive $575,000 to be distributed among the 3,195 class members, defined as residents of the state sued by the defendants between Sept. 22, 2006 and Sept. 22, 2009. As class representatives, Winemiller will receive $10,000 and Adams and Slaghter each will receive $7,500.

After attorneys’ fees and other costs of $231,970 are taken out of the fund, the rest will be distributed to the other class members who file claim forms. Class members will receive no more than $500 each, according to the settlement.

Judge Richard D. Bennett's final order includes: eliminating each class member’s debt, dropping all lawsuits against them with prejudice, satisfying all judgments and releasing judgment liens. The debts also will be removed from the members’ credit scores.

The parties entered the proposed settlement agreement earlier this year and Bennett issued a final order on the agreement in U.S. District Court on Aug. 24.

Scott C. Borison of Legg Law Firm LLC in Frederick, Md. and Peter A. Holland of The Holland Law Firm PC represented the plaintiff class. Mitchell Rubenstein of Rubenstein & Cogan in Gaithersburg, Md., one of the defendants’ attorneys, said he did not want to comment on the case.

To comment on this story, contact Darren Waggoner at darren.waggoner@sourcemedia.com.

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