"she needs to pay $575.00. I think that is way too much for the penalty." Well, the legislature of WA disagrees with you. In fact, the maximum authorized by the statute is $600. This $600 does not include attorney's fees and other costs that the store can be awarded by the court against your wife. So, if your wife is sued, the judgment against her may be significantly more than $575.
On another hand, no one here can say with any certainty whether you wife should settle the civil lawsuit. It may be true that the particular law firm you mentioned would not sue your wife. Principally, because it is not licensed in WA to practice law or, apparently, to collect debts. However, there are many collection agencies in WA that can and would sue for $575. Their principal objective is likely not the amount in dispute but the potential to collect attorney's fees and costs that can add thousands to a $575 debt.
Besides the civil demand letter, your wife likely had or should be soon getting a summons from the court to appear for a criminal law case against her. In many ways, the criminal law case is much more important than the civil demand.
Your wife needs to review her specific facts with her attorney to find out her legal options. For the criminal law case, if she is low income by local standards, she can apply for a public defender who is an attorney paid by the government. Around Seattle, persons making what many would consider to be good money can still be considered low income for court purposes.
I generally advise clients to ignore these civil demand letters. You don't owe them anything. In order for you to owe them something they would have to sue you, (in some jurisdictions prove damages which they most likely couldn't do), and win. Even if they could win, the cost of pursuing this is substantially greater than any amount they can possibly recover so they usually don't. They send out these letters because it doesn't cost much and they are hoping that you don't know better and simply send them the money. Nothing will happen to you if you don't pay it. Take a look at the article in the Wall Street Journal at the link I've included below.
It is important to note a shoplifiting allegation can lead to both criminal and civil liability. Criminally your wife is looking at a gross misdemeanor which means up to 364 days in jail and a $5,000 fine. As part of that criminal matter, the store could seek restitution through the prosecutor. Washington does have a "misdemeanor compromise" statute, which provides you can pay a "civil penalty" to the store, and the criminal charge will be dismissed. The application of this statute will depend on your wife's criminal history.
In the civil arena, the store can sue for monetary damages. It is unlikely the store would take that route given the small value of the items allegedly stolen, but is is a possibility. Your wife should definitiely consult with a local attorney to discuss all the possibile ramifications of this alleged incident.
It is important you and your wife consult with a criminal defense attorney before responding to the civil demand letter. A skilled criminal defense attorney may be able to negotiate the civil demand to a lower amount and obtain documentation that could possibly be used under Washington's compromise of misdemeanor statutes to avoid a criminal conviction, fines, and the possibility of jail for the shoplifting theft.
Many people who ignore these civil demand letters not only face potential damage to their credit and civil judgments, but miss an opportunity to defend the theft charge under the compromise of misdemeanor statutes. This is why speaking to an attorney prior to responding to the civil demand letter is extremely important.
Do not pay anything. Any civil payment can be used against her in court as an admission of guilt. Ignore it. They will not sue you in court for $575.00. It is not worth the filing fees and service of process costs. You may call my office to discuss at 206-613-3111. I have 14 years of defense experience in Washington state. - Greg