By: Michael L. Moskowitz and Melissa A. Guseynov
We previously reported on the Consumer Judgment Interest Act (S.5724A/A.6474A), enacted on December 31, 2021, which retroactively lowered the post-judgment interest rate from 9 percent to 2 percent. (See here: Consumer Alert: Judgment Interest on Consumer Debt Slashed by Governor Hochul). The reduction would sharply reduce the debt load for consumers who are unable to pay their debts before a judgment is entered.
The law was scheduled to take effect on April 30, 2022. However, a federal district court judge in the Southern District of New York granted a preliminary injunction to three credit unions, finding they established a likelihood of success on claims in their class action lawsuit that the retroactive application of the law was an unconstitutional taking.
The preliminary injunction remains in place while the class action lawsuit proceeds. Weltman & Moskowitz will continue to follow and report on this case as it progresses. We will keep clients and colleagues informed of the developing impact to creditors and debtors alike.
About Weltman & Moskowitz, LLP, A New York and New Jersey Business, Bankruptcy and Creditors’ Rights Law Firm:
Founded in 1987, Weltman & Moskowitz, LLP is a highly regarded business law firm concentrating on creditors’ rights, bankruptcy, foreclosure, and business litigation. Michael L. Moskowitz, a partner, focuses his practice on business and bankruptcy litigation, as well as creditor’s rights, foreclosure, adversary proceeding litigation, corporate counseling, M&A, and transactional matters. Michael can be reached at (212) 684-7800, (201) 794-7500 or mlm@weltmosk.com. Melissa Guseynov is an associate with the firm. Melissa can be reached at mag@weltmosk.com .
