What's the point of sending a dispute letter if the original creditor is not bound to suspend collection action or activity? Is a lawsuit considered a collection activity?
To answer your second question first, a lawsuit establishes a debt, and if successful, a judgement against the debtor. Collection is a separate activity. The purpose of disputing, and I'll assume you are disputing a CRA entry, is to have something removed that will improve your overall credit score. If you dispute a legitimate debt and it is indeed verified, it will remain. However, sometimes they are removed. Judgements are almost always verified as it is quite simple to acquire the information from the county clerk.