Justia Consumer Law Opinion Summaries

Plaintiffs, a group of consumers, alleged that Strange Honey Farm, LLC, fraudulently marketed its honey products as "100% raw Tennessee honey." They claimed the honey was not raw, as it was heated during processing, not purely honey, as it was diluted with corn syrup, and not from Tennessee, as it was sourced from Vietnam. Plaintiffs filed a complaint against Strange Honey, its owners, and two supermarket chains that sold the honey, asserting fraudulent misrepresentation and violations of various state consumer protection laws.The United States District Court for the Eastern District of Tennessee dismissed the claims against all defendants except one, citing a lack of specificity required by Federal Rule of Civil Procedure 9(b). The court also denied plaintiffs' motion for leave to amend their complaint. Plaintiffs then voluntarily dismissed the remaining defendant and appealed the district court's decisions.The United States Court of Appeals for the Sixth Circuit reviewed the case and addressed several jurisdictional issues. The court determined that it had jurisdiction to hear the appeal because the district court's eventual entry of final judgment, after the premature notice of appeal, ripened the appellate jurisdiction. On the merits, the Sixth Circuit affirmed the district court's dismissal, finding that the plaintiffs' complaint failed to meet the specificity requirements of Rule 9(b). The court noted that the complaint did not adequately allege why the statements on the honey labels were false or when the statements were made to the plaintiffs. The court also upheld the district court's denial of leave to amend, concluding that the proposed amendments would be futile as they did not cure the deficiencies in the original complaint. View "Greer v. Strange Honey Farm" on Justia Law

Adam and Miranda Steines, along with Andrew Ormesher, filed a class action lawsuit against Westgate, a resort company, alleging violations of the Military Lending Act (MLA). The Steines, who purchased a timeshare in Orlando and financed it through a loan from Westgate, claimed that Westgate's loan documents did not comply with the MLA's requirements, including the prohibition of mandatory arbitration clauses. The Steines sought rescission of their timeshare, injunctive relief, damages, and restitution.The United States District Court for the Middle District of Florida held an evidentiary hearing and denied Westgate's motions to compel arbitration and dismiss the complaint. The court found that the MLA applied to the timeshare loan and that the MLA's prohibition on mandatory arbitration clauses overrode the Federal Arbitration Act (FAA). Westgate appealed the decision, arguing that the district court should not have addressed the arbitrability issue and that the MLA did not override the FAA.The United States Court of Appeals for the Eleventh Circuit reviewed the case and affirmed the district court's decision. The court held that the question of whether the MLA overrides the FAA is a matter for the court to decide, not the arbitrator. The court found that the MLA explicitly prohibits mandatory arbitration clauses in consumer credit contracts involving servicemembers, thereby overriding the FAA. Additionally, the court agreed with the district court's finding that the timeshare loan did not qualify as a "residential mortgage" under the MLA, as the timeshare units were more akin to hotel rooms than residential dwellings.As a result, the Eleventh Circuit dismissed the interlocutory appeal for lack of jurisdiction, affirming that the MLA's provisions rendered the FAA inapplicable in this case. View "Steines v. Westgate Palace, L.L.C." on Justia Law

In two separate class actions, Kenneth Hasson and Jordan Schnur alleged that FullStory, Inc. and Papa John’s International, Inc. unlawfully wiretapped their online communications using FullStory’s Session Replay Code. This code intercepts detailed user interactions on websites without user consent. Hasson, a Pennsylvania resident, claimed FullStory wiretapped him while he browsed Mattress Firm’s website. Schnur, also from Pennsylvania, alleged similar wiretapping by Papa John’s website.The United States District Court for the Western District of Pennsylvania dismissed both cases for lack of personal jurisdiction. In Hasson’s case, the court found that FullStory, a Delaware corporation with its principal place of business in Georgia, did not have sufficient contacts with Pennsylvania. The court denied Hasson’s request for jurisdictional discovery. In Schnur’s case, the court ruled that Papa John’s, also a Delaware corporation with its principal place of business in Georgia, did not expressly aim its conduct at Pennsylvania, despite operating numerous restaurants in the state.The United States Court of Appeals for the Third Circuit reviewed these dismissals. The court affirmed the dismissal in Schnur’s case, agreeing that Schnur failed to show that Papa John’s expressly aimed its conduct at Pennsylvania under the Calder “effects” test. The court noted that merely operating a website accessible in Pennsylvania does not establish personal jurisdiction.However, the court vacated the dismissal in Hasson’s case and remanded it for further consideration. The court held that the District Court should have also considered whether personal jurisdiction was proper under the traditional test as articulated in Ford Motor Co. v. Montana Eighth Judicial District Court. This test examines whether the defendant purposefully availed itself of the forum and whether the plaintiff’s claims arise out of or relate to the defendant’s contacts with the forum. The court instructed the District Court to reassess FullStory’s contacts with Pennsylvania under this framework. View "Hasson v. Fullstory Inc" on Justia Law

The case involves family members of drug abusers suing wholesale distributors of prescription medications. The plaintiffs alleged that the distributors violated state and federal laws by failing to report suspicious orders of controlled substances, which led to the drug abusers' addictions and subsequent harm to the plaintiffs. The plaintiffs sought damages under the Georgia Drug Dealer Liability Act (DDLA) and other legal theories.The case was initially tried in a lower court, where a jury returned a verdict in favor of the distributors. The plaintiffs then moved for a new trial, arguing that a juror was dishonest during the selection process and introduced extraneous prejudicial information during deliberations. The trial court denied the motion for a new trial, leading to the current appeal.The Supreme Court of Georgia reviewed the case. The plaintiffs argued that the trial court erred in denying their motion for a new trial and in refusing to instruct the jury on willful blindness. The distributors cross-appealed, arguing that if the judgment was vacated, the DDLA should be declared unconstitutional. The Supreme Court of Georgia affirmed the trial court's decision, finding no abuse of discretion in denying the motion for a new trial. The court held that the trial court was authorized to credit the juror's testimony over the plaintiffs' evidence and that the jury was properly instructed on the relevant legal issues. The cross-appeal was dismissed as moot. View "CARDINAL HEALTH INC. v. POPPELL" on Justia Law

John Doe, a patient at Ridgeview Institute – Monroe, sued the facility's owners, operators, and CEO after a former employee, Rhonda Rithmire, disclosed patient information without authorization. Doe sought to represent a class of affected patients, alleging multiple claims including breach of contract and negligence. The trial court denied Doe's motion for class certification, finding that he failed to meet the commonality and typicality requirements under OCGA § 9-11-23 (a). Specifically, the court noted that Doe's disclosed information did not include diagnosis or treatment details, unlike other patients whose more sensitive information was revealed.Doe appealed to the Court of Appeals of Georgia, which reversed the trial court's decision. The appellate court found that Doe's claims and those of the putative class arose from the same events and were based on the same legal theories, thus satisfying the typicality requirement. One judge dissented, disagreeing with the majority's interpretation of the typicality and commonality requirements.The Supreme Court of Georgia reviewed the case to determine if the trial court abused its discretion in denying class certification. The Supreme Court concluded that the trial court acted within its discretion in finding a lack of typicality. The court noted that the differences in the type of information disclosed among class members could lead to different legal theories and defenses, making Doe's claims not typical of the class. As a result, the Supreme Court reversed the Court of Appeals' decision, upholding the trial court's denial of class certification. The court did not address the commonality issue, as the lack of typicality alone was sufficient to deny class certification. View "VEST MONROE, LLC v. DOE" on Justia Law

Pilar Domer placed an online order for a can of paint from Menards, selecting an in-store pickup option that incurred a $1.40 fee. Domer later filed a class action lawsuit against Menards, alleging that the company failed to disclose the pickup fee and used it to manipulate prices. Menards moved to compel arbitration based on an arbitration clause in their online terms of order. The district court granted Menards' motion, finding that Domer had agreed to the arbitration terms and that her claims fell within the scope of the arbitration agreement.The United States District Court for the Western District of Wisconsin ruled in favor of Menards, determining that the arbitration agreement was enforceable. The court found that Menards provided adequate notice of the terms and that Domer had unambiguously agreed to them by completing her purchase. The court also concluded that Domer’s claims were related to her purchase contract with Menards and thus fell within the scope of the arbitration agreement.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court's decision. The appellate court held that Menards' website provided reasonably conspicuous notice of the terms, and Domer unambiguously manifested her assent by submitting her order. The court also found that Domer’s claims, which included violations of consumer protection laws and unjust enrichment, arose from or related to her purchase contract with Menards. Therefore, the claims were within the scope of the arbitration agreement. The Seventh Circuit concluded that the arbitration agreement was valid and enforceable, and Domer’s claims must be arbitrated. View "Domer v. Menard, Inc." on Justia Law

Daniel Pomerantz appealed the Cannabis Control Board’s denial of his request to waive application and licensing fees for his proposed commercial cannabis cultivation establishment. Pomerantz claimed he qualified as a “social equity applicant” due to past incarceration for a cannabis-related offense and coming from a community historically impacted by cannabis prohibition. The Board determined he did not meet the criteria and denied his request.Initially, Pomerantz applied for a Tier 5 cultivation license on behalf of Rebel East, LLC, asserting he qualified for social equity status due to a past cannabis-related offense in Nevada. The Board found he was not eligible because his sentencing was deferred, and he was not incarcerated as a penalty for the offense. Pomerantz then argued he qualified as a socially disadvantaged individual due to his residency in Humboldt County, California, a region he claimed was disproportionately affected by cannabis prohibition. The Board allowed him to amend his application but ultimately found he did not demonstrate personal harm from living in Humboldt County.The Vermont Supreme Court reviewed the Board’s decision. The Court upheld the Board’s interpretation that “incarcerated” meant serving a prison sentence as a penalty for a cannabis-related conviction, which Pomerantz did not. The Court also agreed with the Board’s assessment that merely living in Humboldt County did not automatically qualify Pomerantz as being from a disproportionately impacted community. Furthermore, the Court found that Pomerantz did not sufficiently demonstrate personal harm from his residency in Humboldt County, noting his significant personal and professional advancements during that time.The Vermont Supreme Court affirmed the Board’s decision, concluding that Pomerantz did not qualify as a social equity individual applicant under the Board’s rules. View "Pomerantz v. Cannabis Control Board" on Justia Law

In this case, the plaintiff purchased a new 2014 Kia Optima and soon experienced issues with the vehicle's reverse gear. Despite multiple visits to the dealership, the problem persisted. The plaintiff requested a buyback from Kia Motors America, Inc. (Kia), but Kia's investigations, including installing a flight recorder, did not confirm the defect. Kia eventually offered to repurchase the vehicle, but the plaintiff rejected the offer and continued to use the car until filing a lawsuit under California’s Song-Beverly Consumer Warranty Act (the Act).The Superior Court of Los Angeles County found in favor of the plaintiff, awarding restitution and a civil penalty for Kia's willful violation of the Act. Kia filed posttrial motions challenging the restitution amount and the civil penalty. The court partially granted Kia's motions, striking the civil penalty for insufficient evidence but denying the motion to reduce the restitution amount.The California Court of Appeal, Second Appellate District, reviewed the case. The court held that the restitution award should not include the cost of the optional service contract, certain insurance premiums, and other specific amounts. The court affirmed the trial court's decision to grant a new trial on the civil penalty, finding substantial evidence that Kia may have had a good faith and reasonable belief that the vehicle was not defective.The appellate court directed the trial court to amend the judgment to exclude the non-recoverable amounts from the restitution award and to conduct a new trial on the civil penalty, limited to the period before the lawsuit was filed. The court clarified that a violation of the Act is willful only if it is deliberate, knowing, or not based on a good faith and reasonable belief of compliance. View "Valdovinos v. Kia Motors America, Inc." on Justia Law

Plaintiffs from twenty-six states sought class certification in their lawsuit against General Motors, LLC (GM) for alleged defects in the 8L45 and 8L90 transmissions of vehicles purchased between 2015 and 2019. Plaintiffs experienced "shudder" and shift quality issues that persisted despite repairs. GM argued that the class lacked standing and that individualized issues would predominate over common issues in the class-action suit.The United States District Court for the Eastern District of Michigan determined that the Plaintiffs had standing and could satisfy Federal Rule of Civil Procedure 23, thus certifying the class. GM appealed, claiming the district court abused its discretion in certifying the class.The United States Court of Appeals for the Sixth Circuit reviewed the case and held that the Plaintiffs had standing, as they alleged overpayment for defective products, which suffices for Article III standing. The court also found that the district court did not abuse its discretion in certifying the class, as the common questions of law and fact predominated over individualized issues. The court addressed GM's arguments regarding state laws requiring manifest defects, reliance, causation, and merchantability, concluding that these issues did not preclude class certification. The court also held that GM had waived its right to arbitration by engaging in litigation and seeking dispositive rulings on the merits.The Sixth Circuit affirmed the district court's class certification, allowing the class-action lawsuit against GM to proceed. View "Speerly v. General Motors, LLC" on Justia Law

Craig and Brianna Dulworth discovered that Experian, a credit-reporting agency, incorrectly reported their automobile loan as discharged through bankruptcy, despite their reaffirmation and continued payments. After Experian ignored their correction letters, the Dulworths sued in Indiana state court, alleging violations of the Fair Credit Reporting Act. Experian removed the case to federal court and issued broad subpoenas to the Dulworths' law firm, Stecklein & Rapp, seeking extensive information, including details about the firm's business structure and interactions with other clients.Stecklein & Rapp sought relief from the subpoenas in the United States District Court for the Western District of Missouri, where compliance was required. The district court found the requested materials irrelevant to the Dulworths' lawsuit, quashed the subpoenas, and awarded $93,243.50 in attorney fees and costs to Stecklein & Rapp. Experian appealed both the fee award and the discovery ruling.The United States Court of Appeals for the Eighth Circuit reviewed the district court's decision for abuse of discretion. The appellate court affirmed the district court's ruling, agreeing that the subpoenas were overly broad and irrelevant to the case. The court emphasized that the Fair Credit Reporting Act required Experian to conduct a reasonable reinvestigation upon receiving a dispute notice, regardless of whether the notice came directly from the consumer or through their attorney. The court also upheld the attorney fees award, noting that Experian failed to take reasonable steps to avoid imposing an undue burden on Stecklein & Rapp, justifying the sanctions under Rule 45(d)(1) of the Federal Rules of Civil Procedure. View "Stecklein & Rapp Chartered v. Experian Information Solutions, Inc." on Justia Law