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The Supreme Court affirmed the judgment of the Court of Appeal concluding that some overlap between the Investigative Consumer Reporting Agencies Act (ICRAA), Cal. Civ. Code 1786 et seq. and the Consumer Credit Reporting Agencies Act (CCRAA), Cal. Civ. Code 1785.1 et seq., does not render ICRAA unconstitutionally vague as applied to employer background checks when the statutes are otherwise unambiguous. In this class action, Plaintiff sued Defendants, investigative consumer reporting agencies, for violating ICRAA because Defendants did not obtain her written authorization to conduct a background check. Defendants moved for summary judgment, claiming (1) ICRAA was unconstitutionally vague as applied to Plaintiff’s claim because it overlapped with CCRAA, and (2) Defendants satisfied CCRAA. The trial court granted the motion. The Court of Appeal reversed. The Supreme Court affirmed and remanded, holding (1) the background check that Defendants conducted was an investigative consumer report under ICRAA; and (2) although the CCRAA also applied here, Defendants were not exempted from the requirement that they obtain Plaintiff’s written authorization under ICRAA before conducting or procuring a background investigation. View "Connor v. First Student, Inc." on Justia Law

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The Fair Debt Collection Practices Act provides for class statutory damages not to exceed the lesser of $500,000 or 1 per centum of the net worth of the debt collector. The statute is silent as to which party bears the burden of introducing evidence at trial to establish the debt collector's net worth. The Ninth Circuit affirmed the district court's dismissal of a consumer class action under the FDCPA and held that plaintiff carried the burden of producing evidence at trial of the debt collector's net worth to establish entitlement to class statutory damages under the FDCPA. In this case, plaintiff had every opportunity to acquire evidence of defendant's net worth but failed to produce any competent evidence of this amount at trial. View "Tourgeman v. Nelson & Kennard" on Justia Law

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Plaintiff brought a putative class action against Air EVAC asserting three claims for relief under Arkansas law. The district court dismissed all claims as preempted by the express preemption provision in the Airline Deregulation Act (ADA). The Eighth Circuit affirmed on a narrower basis and held that the fairness of plaintiff's transaction with Air EVAC and the reasonableness of Air EVAC's price were governed by federal law. Likewise, the court held that the ADA preempted plaintiff's claim that Air EVAC may not seek restitution against class members because it lacked clean hands. Finally, the court held that plaintiff's declaratory judgment claims, like his fraud claims, were ADA-preempted. The court noted that plaintiff's may bring contract defenses and unpreempted judicial remedies were also available. View "Ferrell v. Air EVAC EMS, Inc." on Justia Law

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Portalatin allegedly owed $1,330.75 in consumer debt. The Blatt law firm, on behalf of Midland, filed a debt‐collection suit against Portalatin in the Circuit Court of Cook County’s First Municipal District (Chicago). Seventh Circuit precedent under the Fair Debt Collection Practices Act (FDCPA) then allowed Blatt to sue Portalatin in that forum even though she lived in the Fourth Municipal District (15 U.S.C. 1692i(a)(2)). The Seventh Circuit subsequently overruled that precedent and held the FDCPA requires debt collectors to file suits in the smallest venue‐relevant geographic unit where the debtor signed the contract or resides. Blatt complied, but the ruling was retroactive. Portalatin sued Blatt and Midland for violating the FDCPA. Portalatin settled with Midland and expressly abandoned all claims against Blatt except her claim for FDCPA statutory damages. Blatt argued that Portalatin’s settlement with Midland mooted her claim for FDCPA statutory damages against Blatt. The district court denied Blatt's motions. The jury awarded Portalatin $200 in statutory damages against Blatt; the court awarded Portalatin $69,393.75 in attorney’s fees and $772.95 in costs against Blatt. The Seventh Circuit reversed. The settlement with Midland mooted Portalatin’s claim for FDCPA statutory damages against Blatt. Portalatin is not entitled to attorney’s fees or costs from Blatt. View "Portalatin v. Blatt, Hasenmiller, Leibsker & Moore, LLC" on Justia Law

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The Supreme Court held that the interest rate on consumer loans of $2,500 or more may render the loans unconscionable under section 22302 of the Financial Code. Defendant, a lender of consumer loans to high-risk borrowers, had as one of its signature products an unsecured $2,600 loan carrying an annual percentage rate (APR) of either ninety-six percent or, later in the class period, 135 percent. Plaintiffs alleged that CashCall violated California’s Unfair Competition Law (UCL), Cal. Bus. & Prof. Code 17200 because its lending practice was unlawful where it violated section 22302, the section that applies the unconscionability doctrine to consumer loans. The district court certified Plaintiffs’ lawsuit as a class action and then granted CashCall’s motion for summary judgment. On appeal, the federal court of appeals certified to the Supreme Court a question of law. The Supreme Court answered in the positive, holding that an interest rate on consumer loans of $2,500 or more may be deemed unconscionable under section 22302. View "De La Torre v. CashCall, Inc." on Justia Law

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The FHA-insured mortgage on the Schlafs’ property is serviced by Green Tree. The Schlafs defaulted. Green Tree was unable to contact them. Green Tree contracts with Safeguard, a “mortgage field servicing company,” to perform services on properties with defaulted mortgages, including maintenance, winterizing, lock changes, and utility management. Safeguard assists Green Tree in complying with HUD regulations: When a mortgage is in default and efforts to reach the mortgagor have proven unsuccessful, the mortgagee must make an inspection to determine if the property is vacant or abandoned. During these inspections, Safeguard representatives place hangers on an outside doorknob, with instructions for the property owner: PLEASE CALL … GREEN TREE 800‐666‐1143. The door hanger does not identify Safeguard. Safeguard representatives leave the notice even if they encounter the homeowner; they do not identify themselves as Safeguard representatives and avoid talking about why they are there. Safeguard acknowledges that the door hanger is an effort to have the mortgagor contact the client. At least once, Schlaf encountered a Safeguard representative. Schlaf, unable to identify or speak with the Safeguard representative, called the number on the door hanger, which “took [him] right to Green Tree.” He testified that he did not know if Safeguard collected debt. Schlaf sued Safeguard under the Fair Debt Collection Practices Act. The court granted Safeguard summary judgment The Seventh Circuit affirmed. Safeguard’s actions were too attenuated from Green Tree’s debt‐collection efforts; Safeguard is not a debt collector. View "Schlaf v. Safeguard Property, LLC" on Justia Law

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Plaintiff appealed the district court's grant of summary judgment in an action alleging that FCA violated the Missouri Merchandising Practices Act (MMPA) by making deceptive representations about the safety of certain Jeep vehicles. Plaintiff also appealed the denial of his motion to remand to state court. The Eighth Circuit held that it had jurisdiction under the Class Action Fairness Act (CAFA) where the amount in controversy jurisdictional limit was satisfied after taking into consideration the sum of damages and the amount of potential attorneys' fees. The court held that plaintiff's claim under the MMPA failed where his purchase had no relationship with the alleged misrepresentation regarding the vehicles' safety. In this case, there was no evidence suggesting that either the seller or the buyer was aware of the misrepresentation, nor was the intermediary seller an unwitting conduit for passing on the substance of the misrepresentation. View "Faltermeier v. FCA US LLC" on Justia Law

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St. Pierre used New Jersey E-ZPass and agreed to maintain a positive balance in a prepaid account from which highway tolls are automatically deducted. When he failed to maintain a positive balance, E-ZPass assigned his account to a private debt collection agency, which sent St. Pierre a collection letter for $1,200.75. The envelope in which the letter was sent had a glassine window through which was visible St. Pierre’s name and address, a “quick response” code and St. Pierre’s account number. The Fair Debt Collection Practices Act, 15 U.S.C. 1692a-1692p, prohibits the use of “any language or symbol, other than the debt collector’s address, on any envelope when communicating with a consumer by use of the mails,” in the collection of a “debt,” defined as an “obligation . . . of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes.” The district court concluded that the matter was not a debt, but a legal obligation in the nature of a tax. The Third Circuit affirmed the dismissal of St. Pierre’s suit. Violation of section 1692f(8) is a legally cognizable injury that confers standing on St. Pierre but the FDCPA is not implicated where, as here, the bulk, if not all services rendered, are made “without reference to peculiar benefits to particular individuals or property.” View "St. Pierre v. Retrieval Masters Creditors Bureau, Inc." on Justia Law

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Tepper took a home equity line of credit with NOVA Bank secured by a mortgage. The Pennsylvania Department of Banking closed the Bank. The FDIC was its receiver. Tepper stopped receiving statements but attempted to remit payments. The FDIC neither cashed nor returned the check. Rather than attempt further payments, Tepper waited for a statement. Months later, the FDIC declared the loan to be in default and sold it, assigning the mortgage, to Amos, an Illinois LLC that is not a lender but only purchases debts for collection. Amos mailed Tepper letters demanding lump-sum payments and sent a notice, containing a higher amount due, stating that it intended to foreclose, then filed a foreclosure action. Amos was not yet registered to do business in Pennsylvania. Tepper requested loan statements and to resolve the default. An Amos officer refused to provide statements and said the Tepper home belonged to Amos. Amos's attorney sent an email attempting to collect an even higher amount. Tepper filed suit under the Fair Debt Collections Practices Act. The court decided: Amos is a “debt collector” under 15 U.S.C. 1692a(6); the loan is a “debt” (1692a(5)); and Amos violated the Act but was not liable for failing to register. The Third Circuit affirmed that Amos is a debt collector. Whether an entity acquired the debts it collects after they became defaulted does not resolve whether that entity is a debt collector: an entity whose principal purpose is the collection of any debts is a debt collector regardless whether it owns the debts it collects. View "Tepper v. Amos Financial LLC" on Justia Law

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Under the removal statute, 28 U.S.C. 1447(c), if at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded. The Eighth Circuit vacated the district court's dismissal of a putative class action alleging that Nomax violated the Telephone Consumer Protection Act (TCPA), by transmitting twelve advertisements to the Heart Center by fax without including a proper opt-in notice on each advertisement. The court held that Heart Center lacked Article III standing, but that the proper disposition was remand to state court under section 1447(c). Accordingly, the court remanded with instructions to return the case to state court. View "St. Louis Heart Center, Inc. v. Nomax, Inc." on Justia Law