Being sued by Blitt & Gaines

In July 2009 I received a notice from Blitt & Gaines stating that they were collecting in behalf of Capital One for a debt that I don't believe is mine (I was a victim of fraud in 2005 and that's when this account was opened but I didn't file a police report because it was a family member that committed the fraud I just didn't think that they opened credit cards under my name). I contacted them via email and requested a payment plan through my debt consolidation company. 1 month later they responded stating that i need to make a minimum payment of $407.00. I told them that I couldn't afford this payment and they stated to hold on and wait a few months. Again, in April I tried to come into another payment plan agreement through my debt management company but this time they agreed and accepted a monthly payment of $43.00 which I have been making every month. So far I have made a total of 4 payments which total $172.00. Now, I found out that they have filed a lawsuit against me through Civil Court for the same account even after making monthly payments. What can I do? Can they do this? Also, they stated that they are suing in behalf of Capital One but Capital One informed me (in writing) that they sold this debt to TrakAmerica. Can they do this? PLEASE HELP!!!!