Justia Consumer Law Opinion Summaries

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The Ninth Circuit filed an order (1) amending its December 29, 2020, opinion issued on remand from the United States Supreme Court; and (2) denying on behalf of the court a sua sponte request for rehearing en banc. The panel reaffirmed the district court's order granting the CFPB's petition to enforce Seila Law LLC's compliance with the Bureau's civil investigative demand (CID) requiring the firm to produce documents and answer interrogatories. The amendments reflected that two of the panel's citations were to the plurality portion of the Supreme Court opinion.The panel held that the CID was validly ratified, but that there was no need to decide whether the ratification occurred through the actions of Acting Director Mulvaney. After the Supreme Court's ruling, the CFPB's current Director, Kathleen Kraninger, expressly ratified the agency's earlier decisions. Furthermore, at the time that she ratified these decisions, Director Kraninger knew that the President could remove her with or without cause. Therefore, the ratification remedied any constitutional injury that Seila Law may have suffered due to the manner in which the CFPB was originally structured. Seila Law advances two arguments challenging the validity of Director Kraninger's ratification, neither of which the panel found persuasive. For the reasons given in its earlier decision, the panel rejected Seila Law's arguments challenging the CFPB's statutory authority to issue the CID. View "Consumer Financial Protection Bureau v. Seila Law LLC" on Justia Law

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Medicredit sent Markakos a letter seeking to collect $1,830.56 on behalf of a creditor identified as “Northwest Community 2NDS” for medical services. Markakos’s lawyer sent Medicredit a letter disputing the debt (because the medical services were allegedly inadequate). Medicredit then sent a response that listed a different amount owed: $407.00. Markakos sued Medicredit for allegedly violating the Fair Debt Collection Practices Act, 15 U.S.C. 1692g(a)(1)–(2), by sending letters to her that stated inconsistent debt amounts and that unclearly identified her creditor as “Northwest Community 2NDS”—which is not the name of any legal entity in Illinois.The Seventh Circuit affirmed the dismissal of the case without prejudice. Markakos lacks standing to sue Medicredit under the Act because she did not allege that the deficient information harmed her in any way. She admits that she properly disputed her debt and never overpaid. Markakos’s only other alleged injury is that she was confused and aggravated by Medicredit’s letter. Winning or losing this suit would not change Markakos’s prospects; if Markakos lost, she would continue disputing her debt based on the inadequacy of the services and if she won, she would do the same. Not a penny would change hands, and no word or deed would be rescinded. View "Markakos v. Medicredit, Inc." on Justia Law

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The Second Circuit affirmed the district court's grant of summary judgment in favor of Lands' End in a putative class action brought by Gorss Motels under the Telephone Consumer Protection Act (TCPA), seeking compensation for faxes it received advertising the products of Lands' End.As a preliminary matter, although the parties do not raise the issue on appeal, the court concluded that Gorss has standing to proceed under the TCPA. The court concluded that Gorss gave prior express permission to receive the faxes at issue through its franchise agreements with Wyndham, and rejected plaintiff's contention that any permission to send fax advertisements was given to Wyndham and not to Lands' End. Therefore, the court concluded that Gorss agreed to the process that occurred here, in which Wyndham sent Gorss fax advertisements on behalf of a Wyndham approved supplier, Lands' End, advertising products that could be used in franchised motels. View "Gorss Motels, Inc. v. Lands' End, Inc." on Justia Law

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After receiving a credit card receipt printed with the first six and last four digits of her credit card, Thomas sued TOMS for violating the “truncation requirement” of the Fair and Accurate Credit Transactions Act of 2003 (FACTA), 15 U.S.C. 1681c(g), which prohibits anyone who accepts credit or debit cards for payment from printing more than the last five digits of a customer’s card number on the receipt, and offers actual and statutory damages.The district court dismissed, finding that the alleged violation did not result in harm sufficiently concrete for Article III standing purposes. The Sixth Circuit affirmed. FACTA reflects Congress’s concern with preventing identity theft, and its belief that truncating card numbers is the most effective means of doing so but a violation of the truncation requirement does not automatically cause an injury in fact. Thomas’s allegations do not establish an increased risk of identity theft; they do not show how, even if her receipt fell into the wrong hands, criminals would have a gateway to her personal and financial data, and she did not allege that the receipt was lost, stolen, or seen by a third party. View "Thomas v. TOMS King (Ohio), LLC" on Justia Law

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Plaintiffs filed a putative class action on behalf of themselves and “[a]ll consumers to whom [d]efendants, after November 17, 2013, provided an electronically printed receipt” listing the expiration date of the consumer’s credit or debit card in violation of the Fair and Accurate Credit Transactions Act of 2003 (FACTA). Plaintiffs’ only alleged injury was exposure to an increased risk of identity theft and credit/debit card fraud. The complaint alleged that “there are, at a minimum, thousands (i.e., two thousand or more) of members that comprise the Class.” The trial court granted defendants’ motion to dismiss plaintiffs’ complaint based on its determination that plaintiffs could not satisfy Rule 4:32-1’s numerosity, predominance, or superiority requirements for class certification. The Appellate Division affirmed the dismissal as it pertained to the class action claims. The New Jersey Supreme Court reversed, finding plaintiffs sufficiently pled the class certification requirements to survive a motion to dismiss. The Supreme Court remanded the matter for class action discovery to be conducted pursuant to Rule 4:32-2(a), so that the trial court could determine whether to certify the class. View "Baskin v. P.C. Richard Son, LLC" on Justia Law

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The Court of Appeals reversed in part and affirmed in part the judgment of the court of special appeals dismissing an amended complaint for failure to state a claim upon which relief can be granted, holding that Petitioners' amended complaint adequately set forth a cause of action under Md. Code Real Prop. (RP) 7-113.Petitioners, occupants of residential property that they owned or leased, brought this action against Respondents, a mortgage servicer and a real estate broker, after Respondents posted eviction notices on Petitioners' properties in an attempt to gain possession of the properties without a court order. Petitioners claimed that Respondents violated RP 7-113 and the Maryland Consumer Protection Act (MCPA), Md. Code Comm. Law 13-101 et seq. The circuit court dismissed the complaint for failure to state a claim. The court of special appeals affirmed. The Court of Appeals reversed in part, holding (1) Petitioners set forth a cause of action under RP 7-113; and (2) this Court has not established a more demanding standard for pleading damages in private actions brought under the MCPA. View "Wheeling v. Selene Finance LP" on Justia Law

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Edward Wrenn ("Edward") and David Wrenn ("David") petitioned the Alabama Supreme Court for a writ of mandamus to direct a circuit court to vacate an order requiring Edward and David to disclose their personal income-tax returns to plaintiff Jeffrey Wright, and to enter a protective order shielding the tax returns from production. Wright alleged he contracted with A-1 Exterminating Company, Inc. ("A-1 Exterminating"), for periodic termite treatments of his house. Over the course of several decades of treatments, Wright says, A-1 Exterminating used a "watered-down pesticide so weak that it may only kill ants and 'maybe' spiders." A-1 Exterminating allegedly concealed this practice from him. As a result, Wright contended his house was infected with and damaged by termites. Wright sued Edward, David, A-1 Exterminating, A-1 Insulating Company, Inc., and Wrenn Enterprises, Inc., alleging breach of warranty, breach of contract, negligence and wantonness. Wright sought to represent a class consisting of himself and other A-1 Exterminating customers allegedly harmed by defendants' actions. In support of his request to certify a class, Wright alleged that a "limited fund" existed that would support a class action under Rule 23(b)(1)(B), Ala. R. Civ. P. The Supreme Court held that for tax returns to be discoverable, they must be highly relevant, the litigant seeking their disclosure must show a compelling need for them, and their disclosure must be clearly required in the interests of justice, and that those standards have not been met in this case. Accordingly, the Court granted the petition and issued the writ to direct the trial court vacate its order requiring disclosure of the tax records. View "Ex parte Edward Wrenn & David Wrenn." on Justia Law

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During the COVID-19 pandemic, Kentucky’s Attorney General opened civil price-gouging investigations into Kentucky-based merchants, including at least one member of the Guild that was selling goods to Kentuckians through Amazon’s online marketplace. The Guild challenged the constitutionality of Kentucky’s price-gouging laws as applied to sellers on Amazon, invoking the extraterritoriality doctrine of the dormant commerce clause. Accepting that the Attorney General sought only to enforce the Commonwealth’s price-gouging laws against Kentucky-based sellers in connection with sales to Kentucky consumers through Amazon’s platform, the district court nevertheless granted the Guild a preliminary injunction, concluding that enforcing the laws in connection with Amazon sales would have impermissible extraterritorial effects.The Sixth Circuit vacated, first holding that the Guild is likely to establish direct organizational standing and standing on behalf of its members. This enforcement of Kentucky’s price-gouging laws is unlikely to run afoul of the dormant commerce clause’s extraterritoriality doctrine, which invalidates state laws as per se unconstitutional in the narrow instances where a state expressly or inevitably exceeds its authority and seeks to control wholly out-of-state commerce. The effect on out-of-state commerce of Kentucky’s price-gouging laws depends entirely upon Amazon’s independent decision-making with regard to the structure of its online marketplace, so the application of those laws to Kentucky-based third-party sellers on Amazon in connection with sales to Kentucky consumers is unlikely to offend the extraterritoriality doctrine. View "Online Merchants Guild v. Cameron" on Justia Law

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Plaintiff filed suit against Experian, alleging that the credit reporting agency violated the Fair Credit Reporting Act's (FCRA) requirements. The district court concluded that Experian did not violate the FCRA and granted summary judgment in favor of the agency.After determining that plaintiff had Article III standing, the Eleventh Circuit concluded that plaintiff's claims that Experian negligently violated 15 U.S.C. 1681e and 1681i by failing to undertake reasonable procedures to ensure maximal accuracy in its credit reports, and to conduct a reasonable reinvestigation of disputed information, survive summary judgment. However, the court concluded that plaintiff failed to establish that Experian acted willfully where the agency's interpretation could reasonably have found support in the courts. Accordingly, the court vacated in part, affirmed in part, and remanded for further proceedings. View "Losch v. Experian Information Solutions, Inc." on Justia Law

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Plaintiff filed suit against defendant, alleging violations of the Song-Beverly Consumer Warranty Act, Civ. Code, 1790 et seq, after the new vehicle he leased developed unrepairable defects. The trial court entered a judgment awarding plaintiff restitution and civil penalties under the Act, as well as an order awarding him attorney fees.In the published portion of the opinion, the court held that, under section 1793.2, subdivision (b)(2), if a manufacturer is unable to repair a vehicle after a reasonable number of attempts, then it must either replace the vehicle in accordance with subparagraph (A) or make restitution in accordance with subparagraph (B). In this case, awarding plaintiff the residual value of the vehicle—an amount he admits he did not pay and was not obligated to pay under the terms of the lease—would leave him in a better position than he was in at the time he leased the vehicle. Therefore, it would be contrary to the Legislature's intent in using the term restitution to describe a lessee's damages remedy under the Act. The court was unpersuaded by plaintiff's assertion that excluding the residual value from the restitution award would result in unequal treatment of lease transactions, as compared to purchase transactions, in violation of the Act. Therefore, the restitution award did not violate the equal treatment mandate of the Act. The court rejected plaintiff's contention that he was obligated to terminate the lease and purchase the vehicle when he sought restitution under the Act. Rather, the court read the Act as expressly imposing reacquisition, branding, and disclosure requirements solely on manufacturers who cannot repair a vehicle after a reasonable number of attempts. View "Crayton v. FCA US LLC" on Justia Law