Video Store Lawsuit

Montana's attorney general says a settlement has been approved in a lawsuit filed by all 50 states against the bankrupt Movie Gallery and Hollywood Video.

The company, which went out of business last year, had hired a debt collector to recover $244 million in fees from 3.3 million customer accounts.

But, the attorneys general alleged, the debt collector didn't give customers notice of what they owed and then filed negative credit reports against some of those customers.

Montana Attorney General Steve Bullock filed a lawsuit in January. The other states and the District of Columbia later joined the lawsuit.

The settlement was approved Thursday by a federal judge.

It allows the company to continue to collect debts, but bars them from making negative credit reports or threatening such reports.

Story from the Associated Press