If you’re a collection agency and you want to collect in West Virginia, you’re going to want to make sure that you’re licensed in the state of West Virginia. (Motto: Montani semper liberi. Oh, and bonus fact: West Virginia’s state animal is the black bear! Ursus americanus. You’re welcome.)

Prominent industry debt buyers Cavalry Portfolio Services, LLC, learned this the hard way. West Viriginia’s Office of the Attorney General released a press statement titled “Court Enjoins Cavalry Debt Buyers from Collecting Debts.”

“In addition to halting Cavalry’s pending collections lawsuits,” the release says, “the circuit court’s injunction requires Cavalry to stop all wage garnishments and to release all liens filed against West Virginia consumers’ property stemming from judgments obtained by its companies before they became licensed.”

Cavalry became licensed to collect West Virginia debt in October of 2010. However, they had filed somewhere around 1,300 collection lawsuits prior to being licensed. It’s those accounts — 743 suits that resulted in around $3 million in judgments against West Virginian consumers — that the fuss is about.

Cavalry has also been ordered to send written notices to all affected consumers. Once sent, Cavalry “may accept payments made voluntarily” by consumers (there’s the rub) but must first place them into escrow and report all payments received to the Attorney General’s office.

Essentially, anyone served a collections notice prior to Cavalry being licensed in 2010 is now no longer on the hook to the agency.

insideARM.com attempted to reach Cavalry for comment.