Medical Recovery Services drops request for attorney fees from Melaleuca employee

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IDAHO FALLS — A woman being sued by Medical Recovery Services over a previously-paid $294 medical bill may no longer be on the hook for thousands of dollars in attorney fees.

Earlier this month, EastIdahoNews.com shared the story of a woman we’re calling Mary Johnson. She agreed to speak publicly if her real name was not used because she is worried about the legal repercussions she may face for speaking out about MRS.

MRS asked the court system require Johnson to pay as much as $5,583.25 to cover attorney and legal fees that resulted from a dispute between MRS and her employer, Melaleuca, over garnished wages and an incorrect name.

But late last week, MRS attorney Bryan Smith filed a motion to withdraw an amended application for an award of supplemental attorney fees or costs. That means the debt recovery agency is no longer seeking the fees.

This doesn’t mean the case is officially closed. For that to happen, a satisfaction of judgment must be filed. Until it is, Smith is free to refile for any fees he believes Medical Recovery Services is owed for collecting on the previously satisfied debt.

Johnson’s attorney, Doug Farr, says it’s important that this issue was brought to light.

“As a debt collection attorney myself, I appreciate the media paying attention to situations like this so we all can do better,” Farr said. “Hopefully it will create better debt collection practices in eastern Idaho.”

This case started last year when MRS attorneys Bryan Smith and Bryan Zollinger received a court order to garnish Johnson’s wages over the $294 unpaid debt. But they had her name wrong, and Melaleuca would not garnish the wages.

Legal filings show Melaleuca tried to resolve the issue outside of court, but Smith and Zollinger refused. The case ended up before Magistrate Judge Michelle Mallard, and she ruled Melaleuca was correct in not garnishing the wages.

A proper garnishment with the correct name was then filed, and the debt plus original fees were paid. MRS then filed a motion to collect supplemental attorney fees for their battle with Melaleuca.

These new developments come days after Melaleuca CEO Frank VanderSloot announced he was creating a $500,000 fund to protect eastern Idahoans against aggressive medical debt collectors.

RELATED | Attorney Bryan Smith responds to Melaleuca CEO Frank VanderSloot

Since Thursday, Melaleuca has received over 65 emails and 31 calls from people requesting assistance. Contracted attorneys assisting those in need have already conducted nine consultations.

WATCH OUR 4-PART INVESTIGATION ON MEDICAL RECOVERY SERVICES HERE

— Part 1: Medical debt nightmare: Why a local woman could end up paying over $5,550 for her $294 doctor’s visit

— Part 2: Man fights 5-year legal battle with debt collection company after doctor’s error

— Part 3: How Medical Recovery Services takes care of business

— Part 4: Medical debt, collections and the fees you’ve probably never heard of

EDITOR’S NOTE: In 2015, Melaleuca CEO Frank VanderSloot provided the seed money to launch EastIdahoNews.com. For a short time, he was an owner. He has never had anything to do with the operations of EastIdahoNews.com. Over a year ago, he totally divested his ownership.

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