Bankrupt Hollywood Video to work with customers

Credit: Ed Teachout

Bankrupt Hollywood Video to work with customers

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by Ed Teachout, KGW Staff

Bio | Email | Follow: @KGWNews

kgw.com

Posted on May 6, 2011 at 8:52 AM

Updated Friday, May 6 at 9:14 AM

PORTLAND -- Bankrupt Hollywood Video has agreed to repair customers' credit, lower past due bills and provide proof of late fees.

Like a bad movie, the story behind Oregon-based Hollywood Video’s bankruptcy just won’t end. For now it’s a happy intermission for the more than 3 million customers the company said owe more than $244 million in late fees or for not returning rented movies.

Last January KGW viewers started claiming that Hollywood Video--or a collection agency it hired--was trying to collect on what customers called bogus bills.

Carie Bishop-Sanders said, “They (the collection agency) were saying I returned a movie late a few years ago evidently and now because of the late fees I owe them $99. I asked them for proof and they said they didn’t have to provide it, but that if I didn’t pay they’d send me to collections.”

Today Attorneys General from 50 states settled with Hollywood Video to repair any negative impacts to customers' credit from collection agencies reporting they did not pay. Hollywood officials also agreed to quit charging customers both for movies they did not return and late fees on those same movies.

According to the settlement Hollywood Video’s problems with customers began after it filed for Chapter 11 bankruptcy in 2010. The court’s approved plan created a liquidating trust to collect an estimated $244 million in outstanding debts reportedly owed by 3.3 million customers. The trust contracted with Credit Control Services Inc., in Massachusetts, which in turn subcontracted to national Credit Solutions of Oklahoma.

Following a KGW report on February 22, 2011, a spokesperson for National Credit Solutions said they have stopped collecting any debts for Hollywood Video, adding, “we’re contacting the major credit bureaus to reverse all late fee charges.”   

Oregon Attorney General John Kroger said Thursday that the settlement "does two good things for consumers: one is, it limits the kind of money that Hollywood Video is going to be able to collect from some of the people they claim owe them money, and more importantly, they're going to rescind all the negative credit information they sent to the credit rating agencies."

Kroger said if anyone is contacted by Hollywood Video or someone representing the company asking for money they should contact the Oregon Department of Justice and ask for help.

A press release by the Washington Attorney General’s office said people who felt they were forced to pay for late fees or movies they did not keep should contact them and try to reclaim some of their money.

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