The definition of "consumer" under the Fair Debt Collection Practices Act includes consumers who have been alleged by debt collectors to owe debts that the consumers themselves contend they do not owe. The Seventh Circuit reversed the district court's dismissal of plaintiff's action against Main Street, alleging violations of the FDCPA and the Illinois Collection Agency Act. The court held that, based on the text of the FDCPA, plaintiff was a qualifying consumer under 15 U.S.C. 1692 where Main Street alleged that plaintiff owed debt and tried its case to the bench in small claims court, even if it failed to prove the claim. View "Loja v. Main Street Acquisition Corp." on Justia Law

Francis Ybarra filed suit against the law firm of Greenberg & Sada, alleging that it violated the Colorado Fair Debt Collection Practices Act by obtaining a judgment against her in the Denver County Court on behalf of State Farm Auto Insurance Company. While represented by Greenberg & Sada, State Farm, as the subrogee of an insured to whom it had paid a claim for damages caused by Ybarra, had taken a default judgment against Ybarra. In her complaint, Ybarra alleged particularly that in doing so Greenberg & Sada violated the Act in a number of ways, including by filing State Farm’s negligence action in Denver rather than Jefferson County, where Ybarra is a resident; by using a false representation or deceptive means in attempting to collect a debt by filing for damages in tort; by providing an address for Ybarra’s residence, where it knew or should have known she did not reside; by making false representations of the character, amount, or legal status of the “debt” by alleging that she owned the car she was driving, which she denied; and by failing to comply with the Act in various other ways. The district court granted Greenberg & Sada’s motion to dismiss, finding that the subrogated tort claim upon which State Farm took a default judgment against Ybarra was not a debt as defined by the Act, and therefore the requirements for collection of a debt imposed by the Act did not apply to Greenberg & Sada. Because a tort, as distinguished from a judgment awarding damages for its commission, does not obligate the tortfeasor to pay damages, the Colorado Supreme Court determined it could not be a transaction giving rise to an obligation to pay money, as required in order to constitute a debt within the contemplation of the Act. And because an insurance contract providing for the subrogation of the rights of a damaged insured is not a transaction giving rise to an obligation of the tortfeasor to pay money, but merely changes the person to whom the tortfeasor’s obligation to pay is owed, it also could not constitute a transaction creating debt within the contemplation of the Act. The judgment of the court of appeals was therefore affirmed. View "Ybarra v. Greenberg & Sada, P.C." on Justia Law

Fresenius Medical Care Holdings, Inc., and Fresenius USA, Inc., operated dialysis treatment clinics throughout the United States, including Mississippi. Fresenius also manufactured and sold dialysis products, including GranuFlo, a product administered to patients being treated for end-stage renal disease. GranuFlo was an acid concentrate mixed with bicarbonate and water to create a dialysis fluid. In 2014, the State of Mississippi brought a civil action against Fresenius, alleging that it had engaged in unfair and deceptive trade practices in connection with GranuFlo in violation of the Mississippi Consumer Protection Act. At issue before the Mississippi Supreme Court in this appeal were a batch of discovery disputes arising between the State and Fresenius brought on interlocutory appeal. The State filed a motion to compel discovery against Fresenius and requested a privilege log. Fresenius provided the State with a privilege log similar to the logs produced in other GranuFlo litigation pending elsewhere. Although the State had objected, Fresenius did not log each individual email and email attachment; rather, Fresenius logged “families” or aggregates of documents. The chancery court granted the State’s motion to compel and ordered Fresenius to produce a “full and complete privilege log” to the State. Fresenius produced a second amended privilege log to the State, continuing to use the family logging method. The State filed a second motion to compel, seeking: (1) all emails and email attachments not separately identified on Fresenius’s July 1, 2016, privilege log; (2) withheld documents referred to as attorney notifications (nurses’ memoranda sent to doctors and in-house counsel); and (3) withheld documents referred to as public comment advice (public relations documents). The chancery court ordered Fresenius to produce all emails and email attachments that were responsive to the State’s discovery requests, that had not been produced, and that had not been separately identified on Fresenius’s July 1, 2016, privilege log. The chancery court also ordered Fresenius to submit attorney notifications and public relations documents for in camera review, later ordering production of the notifications. Fresenius appealed these orders. The Mississippi Supreme Court reversed the chancery court's order with respect to the public relations documents; the Court affirmed in all other respects. View "Fresenius Medical Care Holdings, Inc. v. Hood" on Justia Law

Objectors challenged a class action settlement between plaintiff and Godiva for claims under the Fair and Accurate Credit Transactions Act (FACTA). Over the objections, the district court approved the settlement, class counsel's request for attorney's fees, and an incentive award for plaintiff. The Eleventh Circuit held that class members who objected to Federal Rule of Civil Procedure 23(b)(3) class settlements but did not opt out were "parties" for purposes of appeal. Determining that Article III standing requirements were satisfied, the court held on the merits that the district court did not abuse its discretion by awarding attorney's fees despite a Rule 23(h) violation; the district court properly assessed the risks faced by the class and the compensation secured by class counsel, and did not abuse its discretion by awarding an above-benchmark percentage of the common fund; and the district court did not abuse its discretion by granting a $10,000 incentive award to plaintiff as class representative. View "Muransky v. Godiva Chocolatier, Inc." on Justia Law

The Pennsylvania Office of the Attorney General (OAG), on behalf of the Commonwealth, filed suit against more than two dozen nursing homes and their parent companies (collectively, “Appellees”), alleging violations of the Unfair Trade Practices and Consumer Protection Law, (“UTPCPL”), and unjust enrichment. After consideration of Appellees’ preliminary objections, the Commonwealth Court dismissed the claims and this appealed followed. After its review, the Pennsylvania Supreme Court found the dismissal of the UTPCPL claims was improper, but the dismissal of the unjust enrichment claim was proper because the claim was filed prematurely. Accordingly, the Court reversed the Commonwealth Court’s order and remanded for further proceedings. View "Commonwealth, AG Shapiro v. GGNSC LLC, et al" on Justia Law

Midland sent six letters to the Schultzes, attempting to collect separate outstanding debts that had been outsourced to Midland for collection after default. None of the debts exceeded $600. Each letter offered to settle for less than the full amount owing and each stated: We will report forgiveness of debt as required by IRS regulations. Reporting is not required every time a debt is canceled or settled, and might not be required in your case.” Since the Treasury only requires an entity to report a discharge of indebtedness of $600 or more to the IRS, the Schultzes claimed that the statement was “false, deceptive and misleading” in violation of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692. Their putative class action complaint was dismissed. The Third Circuit reversed, finding that the statement may violate the FDCPA. A dunning letter is false and misleading if it implies that certain outcomes might befall a delinquent debtor, when legally, those outcomes cannot occur. Even if the least sophisticated debtor can distinguish between “may” and “must,” the language at issue references an event that would never occur. It is reasonable to assume that a debtor would be influenced by potential IRS reporting and that, if that reporting cannot occur, it could signal a potential FDCPA violation regardless of the conditional language. View "Schultz v. Midland Credit Management, Inc." on Justia Law

The Ninth Circuit vacated the district court's grant of summary judgment to Crunch Fitness on plaintiff's claim that three text messages he received from Crunch violated the Telephone Consumer Protection Act (TCPA). The panel held, in light of the DC Circuit's recent opinion in ACA International v. Federal Communications Commission, 885 F.3d 687 (D.C. Cir. 2018), and based on the panel's own review of the TCPA, that the statutory definition of automatic text messaging system includes a device that stores telephone numbers (ATDS) to be called, whether or not those numbers have been generated by a random or sequential number generator. Because the district court did not have the benefit of ACA International or the panel's construction of the definition of ATDS, the panel vacated and remanded for further proceedings. View "Marks v. Crunch San Diego, LLC" on Justia Law

Plaintiffs, convicted of drug offenses between 1997 and 2007, applied to Southeastern Pennsylvania Transportation Authority (SEPTA) for jobs that involved operating vehicles. Each filled out a form disclosing his criminal history and authorizing SEPTA to obtain a background check. SEPTA denied them employment. SEPTA did not send Plaintiffs copies of their background checks before it decided not to hire them, nor did it send them notices of their rights under the Fair Credit Reporting Act (FCRA), which required SEPTA to send both before it denied them employment, 15 U.S.C. 1681b(b)(3). Plaintiffs filed a putative class action, which the district court dismissed for lack of standing, reasoning there was only a “bare procedural violation,” not a concrete injury in fact because Plaintiffs alleged that SEPTA denied them jobs based on their criminal history, which Plaintiffs disclosed before the background checks. The Third Circuit affirmed the dismissal of the claim based on failure to provide notice of FCRA rights. Plaintiffs became aware of their FCRA rights and were able to file this lawsuit within the prescribed limitations period, so they were not injured. The court reversed the dismissal of the claim based on failure to provide copies of the consumer reports. That right exists whether the report is accurate or not; FCRA clearly expresses Congress’s “intent to make [the] injury redressable.” View "Long v. Southeastern Pennsylvania Transportation Authority" on Justia Law

Villanueva and the class (Plaintiffs) alleged that Fidelity, an underwritten title company that handled Plaintiffs’ escrow accounts, engaged in unlawful conduct under the Unfair Competition Law (UCL) (Bus. & Prof. Code, 17200) in charging overnight mail delivery fees, courier fees, and document preparation or “draw deed” fees that were not listed in its schedule of rates filed with the Department of Insurance in violation of Insurance Code 12401–12410.10, 12414.27. Fidelity argued that the lawsuit was barred by the statutory immunity in section 12414.26 for matters related to rate-making. The trial court rejected Fidelity’s immunity claim and granted Plaintiffs injunctive relief under the UCL, but denied their restitution claims. The court of appeal reversed. Fidelity’s immunity defense is not subject to the forfeiture doctrine because it implicates the court’s subject matter jurisdiction; this claim is subject to the exclusive original jurisdiction of the Insurance Commissioner because it challenges Fidelity’s activity related to rate-making. The court directed the trial court to enter a new order awarding costs to Fidelity. View "Villanueva v. Fidelity National Title Co." on Justia Law

Bayer AG, maker and marketer of One A Day brand vitamins, was sued in California Superior Court for alleged violations of California’s Consumer Legal Remedies Act, Unfair Competition Law and express warranty law. Plaintiff William Brady’s theory was that Bayer’s packaging of its “Vitacraves Adult Multivitamin” line of gummies was misleading. Brady argued that despite the One A Day brand name, these particular vitamins require a daily dosage of two gummies to get the recommended daily values. Thus buyers end up receiving only half the daily vitamin coverage they think they are getting. The initial complaint was filed as a class action in March 2016, followed by an amended complaint in April, followed by a demurrer in May. The trial court, relying on the unpublished Howard v. Bayer Corp., E. D. Ark. July 22, 2011 (2011 U. S. Dist. LEXIS 161583) involving the supposedly misleading packaging of Bayer’s One A Day gummies, sustained Bayer’s demurrer without leave to amend. The Court of Appeal concluded Bayer failed to appreciate the degree to which their trade name One a Day has inspired reliance in consumers, and held an action alleging they violated California’s Consumer Legal Remedies Act, Unfair Competition Law and express warranty law should have survived demurrer. View "Brady v. Bayer Corp." on Justia Law