Justia Consumer Law Opinion Summaries

Three public interest organizations brought suit against a utility company that provides natural gas services in the District of Columbia, alleging that the company violated the Consumer Protection Procedures Act (CPPA) by making false and misleading statements about the environmental effects of its natural gas. The organizations claimed these statements appeared in customer bills, on the company’s website, and in other public documents. They sought declaratory and injunctive relief to address the alleged unfair and deceptive trade practices.The utility company responded by filing a special motion to dismiss under the District’s Anti-SLAPP Act, followed by a motion to dismiss under Superior Court Civil Rules 12(b)(1) and 12(b)(6). The company argued that the CPPA does not create a right of action against entities regulated by the Public Service Commission (PSC), citing D.C. Code § 28-3903(c)(2)(B) and the District of Columbia Court of Appeals’ decision in Gomez v. Independence Management of Delaware, Inc., 967 A.2d 1276 (D.C. 2009). The public interest organizations countered that the statutory limitation only applied to the Department of Licensing and Consumer Protection, not to private actors like themselves, and that subsequent amendments to the CPPA had rendered Gomez obsolete. The Superior Court granted the utility’s motion to dismiss, finding that Gomez remained controlling and that the CPPA’s exemptions for PSC-regulated entities had not been altered by later amendments.On appeal, the District of Columbia Court of Appeals affirmed the Superior Court’s dismissal. The court held that, although the plain text of the CPPA does not expressly bar private suits against PSC-regulated entities, binding precedent from Gomez requires that the limitations in D.C. Code § 28-3903(c)(2) apply to private actions as well. Therefore, public interest organizations may not sue entities regulated by the PSC under the CPPA. View "Client Earth v. Washington Gas Light Company" on Justia Law

The dispute arose when a homeowner contracted with a tree nursery company to purchase and install six trees on her property in Washington, D.C. The homeowner sought to restore privacy lost when a neighbor removed existing trees, and she wanted the new trees to provide “evergreen screening.” After installation, she was dissatisfied with the results, noting that the trees did not achieve the desired screening effect and that two of the trees died within a year. She refused to pay the remaining contract balance, prompting the nursery to sue for breach of contract. The homeowner counterclaimed, alleging breach of contract, breach of the duty of good faith and fair dealing, breach of the implied warranty of merchantability, and violations of the D.C. Consumer Protection Procedures Act (CPPA).The Superior Court of the District of Columbia held a bench trial. The court found that the contract required the nursery only to select, install, and monitor six trees for six weeks, not to guarantee any particular screening effect. The court ruled in favor of the nursery on its contract claim and on most of the homeowner’s counterclaims, except for a finding that the nursery breached the implied warranty of merchantability as to one tree (the dogwood) that died soon after installation. The court rejected the homeowner’s claims regarding the CPPA and the duty of good faith and fair dealing, and denied her motion for reconsideration.On appeal, the District of Columbia Court of Appeals affirmed the trial court’s judgment on all grounds. The appellate court held that the contract did not obligate the nursery to provide evergreen screening, that the nursery fulfilled its contractual duties, and that the homeowner breached the contract by withholding payment. The court also affirmed the trial court’s application of the clear-and-convincing-evidence standard to the intentional CPPA claims and agreed that the implied warranty of merchantability was breached only as to the one tree that died. View "Galvin v. Ruppert Nurseries, Inc." on Justia Law

In this case, the appellant purchased a car through an installment sales contract, which was later assigned to a finance company. After the appellant defaulted on payments, the finance company repossessed the vehicle and, through its attorneys, filed a claim in Small Claims Court to recover a deficiency balance. The appellant, representing herself, entered into a settlement agreement to pay the claimed amount in installments. After defaulting on the settlement, a judgment was entered against her, which was satisfied through wage garnishment. Subsequently, the appellant, now represented by counsel, filed a putative class action against the law firm that represented the finance company, alleging violations of various consumer protection laws and abuse of process, based on the assertion that the deficiency debt was not lawfully recoverable due to procedural defects in the repossession process.Previously, the District of Columbia Superior Court dismissed the appellant’s complaint, finding that the law firm was in privity with the finance company for res judicata purposes, and that the complaint failed to state claims under the Uniform Commercial Code (UCC), the District’s Automobile Financing and Repossession Act (AFRA), the Consumer Protection Procedures Act (CPPA), the Debt Collection Law (DCL), and for abuse of process. On an earlier appeal, the District of Columbia Court of Appeals held that the attorney-client relationship alone did not establish privity for res judicata and remanded for further analysis of the mutuality of legal interests.On review, the District of Columbia Court of Appeals held that the appellant’s DCL claim against the law firm could proceed, as the complaint plausibly alleged that the law firm willfully used deceptive means to collect a debt that was not lawfully owed, including seeking to recover an excessive retaking fee and pursuing a deficiency despite procedural defects. The court found that the law firm and finance company did not have the same legal interest in the subject matter of the prior Small Claims action, so res judicata did not bar the DCL claim. However, the court affirmed dismissal of the claims under AFRA, the UCC, the CPPA, and for abuse of process, finding the complaint insufficient as to those causes of action. The case was remanded for further proceedings on the DCL claim only. View "Bell v. Weinstock, Friedman & Friedman, PA" on Justia Law

A nonprofit organization focused on corporate accountability brought suit against a California-based company that exports açaí products, alleging that the company made false and misleading statements about the labor conditions in its supply chain. The complaint asserted that the company’s marketing materials claimed its products were ethically sourced and free from child labor, but the nonprofit alleged these claims were not supported by the realities of the supply chain, including reports that the company purchased fruit from sources outside its registered network without verifying labor conditions.The Superior Court of the District of Columbia reviewed the case after the company moved to dismiss, arguing that California’s Unfair Competition Law (UCL) should apply under District of Columbia choice-of-law rules, and that the nonprofit lacked standing under the UCL. The trial court agreed, finding a conflict between the District’s Consumer Protection Procedures Act (CPPA) and the UCL, and concluded that the UCL applied because the relevant conduct and parties’ connections were centered in California. The court then dismissed the complaint, holding that the nonprofit lacked standing under the UCL, which does not provide for associational standing unless the organization has suffered a loss of money or property.On appeal, the District of Columbia Court of Appeals held that the nonprofit failed to preserve its argument that there was no true conflict between the CPPA and the UCL, so the court assumed a conflict existed. However, the appellate court found that the trial court erred in determining, at the motion to dismiss stage, that the UCL should apply. The appellate court held that, given the limited factual record, it was premature to resolve the choice-of-law issue against the nonprofit, and that the law of the forum (the CPPA) should apply unless further development shows otherwise. The order dismissing the case was reversed and remanded for further proceedings. View "Corporate Accountability Lab v. Sambazon, Inc." on Justia Law

The case involves the District of Columbia's Consumer Protection Procedures Act (CPPA) claims against Facebook, Inc. stemming from the Cambridge Analytica data leak. In 2018, it was revealed that Cambridge Analytica had improperly obtained data from millions of Facebook users through a third-party application developed by Aleksandr Kogan. The District of Columbia alleged that Facebook violated the CPPA by unintentionally misleading consumers about data accessibility to third-party applications, Facebook's enforcement capabilities, and failing to disclose the data breach in a timely manner.The Superior Court of the District of Columbia granted summary judgment in favor of Facebook, concluding that the District had to prove its CPPA claims by clear and convincing evidence. The court found that Facebook's disclosures were accurate and that no reasonable consumer could have been misled. Additionally, the court excluded the testimony of the District's expert witness, Dr. Florian Schaub, criticizing his analytical methods and analysis.The District of Columbia Court of Appeals reviewed the case and held that CPPA claims based on unintentional misrepresentations need only be proved by a preponderance of the evidence, not by clear and convincing evidence. The court reversed the trial court's summary judgment decision and remanded the case for reconsideration under the correct burden of proof. The appellate court also reversed the trial court's exclusion of Dr. Schaub's testimony, finding that the trial court's reasoning was insufficient and remanded for further analysis and explanation.The main holding of the District of Columbia Court of Appeals is that CPPA claims based on unintentional misrepresentations require proof by a preponderance of the evidence, and the exclusion of expert testimony must be supported by a thorough analysis consistent with the standards set forth in Motorola Inc. v. Murray. View "District of Columbia v. Facebook, Inc." on Justia Law

Lezah Roberts entered into a fixed-price contract with Advanced Building Design, a Maryland-based firm, to build a handicap-accessible addition to her home in the District of Columbia. The project, which began in 2017 and was expected to take six months, remained unfinished nearly two years later. The project went over budget due to price increases and change orders, and Advanced sought to recoup these overages from Roberts. After initially agreeing to cover some additional costs, Roberts eventually refused to pay further increases, leading Advanced to cease work on the project. Roberts then filed a complaint in the Superior Court of the District of Columbia, alleging breach of contract, fraudulent misrepresentation, breach of the implied covenant of good faith and fair dealing, and a claim under the D.C. Consumer Protection Procedures Act (CPPA) for unfair trade practices.The Superior Court granted Advanced’s motion to dismiss Roberts’s suit, citing a mandatory forum selection clause in the contract that designated Maryland as the exclusive forum for litigation. Roberts appealed, arguing that the forum selection clause was unenforceable because it conflicted with the CPPA and was unconscionable.The District of Columbia Court of Appeals reviewed the case and disagreed with Roberts on both counts. The court held that the CPPA does not preclude parties from selecting their preferred forum and that the forum selection clause did not contravene public policy or demonstrate procedural or substantive unconscionability. Consequently, the court affirmed the Superior Court’s dismissal of Roberts’s complaint. View "Roberts v. Advanced Building Design" on Justia Law

The case involves Ma Shun Bell, who filed a lawsuit against the law firm Friedman, Framme & Thrush (FFT), formerly known as Weinstock, Friedman & Friedman, alleging unfair trade practices and abuse of process. Bell claimed that FFT, representing First Investors Servicing Corporation (FISC), pursued a deficiency debt from her despite knowing it was not lawfully recoverable due to procedural defects in the vehicle repossession process.In the Superior Court of the District of Columbia, Bell's second amended complaint was dismissed. The court ruled that the complaint failed to allege the elements of a Uniform Commercial Code (UCC) violation, that FFT was immune from suit under the Consumer Protection Procedures Act (CPPA) and the D.C. Automobile Financing and Repossession Act (AFRA) due to its role as litigation attorneys, and that the complaint did not articulate how FFT’s conduct violated the Debt Collection Law (DCL). Additionally, the court found that Bell’s claims were barred by res judicata based on a Small Claims Court judgment in favor of FISC, with which FFT was found to be in privity.The District of Columbia Court of Appeals reviewed the case. The court concluded that Bell’s DCL cause of action could proceed, but her other causes of action were properly dismissed. The court held that the Superior Court erred in finding privity between FFT and FISC solely based on their attorney-client relationship and a contingency-fee arrangement. The court determined that the DCL claims were not barred by res judicata or collateral estoppel and that Bell had sufficiently alleged that FFT misrepresented the amount of the debt and charged excessive fees. The court affirmed the dismissal of the UCC, CPPA, and abuse of process claims but reversed the dismissal of the DCL claim, remanding the case for further proceedings. View "Bell v. Weinstock, Friedman & Friedman, PA" on Justia Law

James Nides filed a lawsuit against DVC Industries, Inc., doing business as The Spice Lab, under the District of Columbia's Consumer Protection Procedures Act (CPPA). Nides alleged that The Spice Lab falsely advertised its "Pink Himalayan Salt" as being hand-mined from the Himalayan Mountains, when it actually came from salt mines in Khewra, Pakistan. Nides claimed that his purchase of the salt was sufficient to give him standing under the CPPA's tester standing provision.The Superior Court of the District of Columbia dismissed Nides's complaint. The court found that Nides failed to demonstrate tester standing under the CPPA because his amended complaint did not allege that he purchased the product with the intent to test or evaluate it. The court also noted that Nides's complaint lacked factual support for his claims about the salt's origin and that his counsel's affirmation did not provide sufficient evidence of testing or evaluation.The District of Columbia Court of Appeals reviewed the case and affirmed the Superior Court's dismissal. The appellate court agreed that Nides's complaint did not meet the requirements for tester standing under the CPPA. The court emphasized that the statutory language requires a plaintiff to allege that they purchased the product with the intent to test or evaluate it, which Nides failed to do. The court also noted that merely observing a product's label or reviewing third-party tests does not constitute the intent to test or evaluate the product as required by the statute.The appellate court concluded that Nides's amended complaint did not plausibly allege that he purchased the salt with the intent to test or evaluate it, and therefore, he lacked standing to sue under the CPPA. The court affirmed the Superior Court's order dismissing the case. View "Nides v. DVC Industries, Inc." on Justia Law

Debra Stevenson and Eugene Smith co-own a property for which Stevenson initially took out a loan from Wells Fargo. After defaulting, she refinanced with Fremont Investment & Loan, which paid off the Wells Fargo loan. Stevenson defaulted again and filed for bankruptcy. HSBC Bank, as Fremont's successor, sought to enforce its interest in the property through equitable subrogation, claiming the right to stand in Wells Fargo's position.In bankruptcy court, HSBC was found to be the holder of the note and entitled to equitable subrogation for the amount used to pay off the Wells Fargo loan. The federal district court adopted this decision, and the D.C. Circuit affirmed, holding that HSBC could enforce its interest despite Fremont's knowledge of Smith's co-ownership and refusal to sign the loan documents.The District of Columbia Court of Appeals reviewed the Superior Court's grant of summary judgment to HSBC. The court held that Stevenson and Smith were collaterally estopped from relitigating issues decided in federal court, including HSBC's standing and entitlement to equitable subrogation. The court also rejected their Truth in Lending Act (TILA) rescission argument, as it had been previously litigated and decided against them. The court affirmed the Superior Court's ruling, finding no genuine issues of material fact and that HSBC was entitled to judgment as a matter of law. View "Stevenson v. HSBC Bank USA" on Justia Law

Douglass Sloan provided a $60,000 short-term loan to Carlos Allen for property rehabilitation, with a 60-day term and a 20% fixed return rate. If unpaid within 60 days, the loan accrued an additional 2% every subsequent 60 days. The loan was subject to the maximum interest rate allowed by D.C. law if not repaid within 60 days. Sloan sought to collect the debt, leading to a dispute over whether the loan's interest rate was usurious, as D.C. law caps interest rates at 24% per annum.The Superior Court of the District of Columbia initially ruled that Allen had waived his usury defense by not raising it for nearly seven years. The court awarded Sloan $256,946.46 plus $97,450 in attorney’s fees and costs. On appeal, the District of Columbia Court of Appeals upheld the attorney’s fees but remanded the case for reconsideration of the usury defense waiver. The trial court then found no substantial prejudice to Sloan from Allen’s delay and ruled the loan usurious, reducing the award to $39,026.46, the remaining principal, plus the affirmed attorney’s fees.The District of Columbia Court of Appeals reviewed the case again. It upheld the trial court’s findings that Allen had not waived his usury defense and that the loan was usurious, as it effectively charged a 34.7% interest rate in its first year. The court rejected Sloan’s arguments against these findings but agreed that Sloan was entitled to post-judgment interest on the award from the date of the initial October 2020 judgment. The court also dismissed Allen’s cross-appeal, which challenged the validity of the loan and the attorney’s fees, as these issues had been resolved in a prior decision. The case was remanded for the imposition of post-judgment interest on the $39,026.46 award. View "Sloan v. Allen" on Justia Law