Can a credit card company, who wrote off your account & sold it to a collection agency, take it back?

My husband had open heart surgery in 2006. We got behind in our credit cards. Chase mastercard wrote off our account and sold it to a collection agency, Phillip & Cohen. We made a settlement agreement with them for three payments of $336.15. They took first payment out via automatic withdrawal (ACH) after getting our bank info, then never took the other two payments. After finally getting hold of them after two months of trying, they refused to honor the settlement, saying we defaulted on the original settlement, but that they would make another one with us with, of course, the interest the account had accrued! I told them that was extortion! We, of course, didn't agree. From there, the account was sold four more times and each collection agency added to the original amount very large sums of gratuitous interest charges. I finally sat down and wrote a letter to the Atty General of our state, as I had doented every conversation. They contacted Chase who has now written us a letter saying "...the account has been returned to Chase." How does that work? They've written it off; sold it to a collection agency, so how did they get it back? Did they have to buy it back themselves? I'm very confused and question the legality of this. Should I send them a validation letter as I did the other collection agencies who 'bought' it? Please, can anyone help us?