Justia Consumer Law Opinion Summaries

Lisa and Peter Woodward incurred a debt of $2,214.44 for their child's dental care, which was placed with Credit Service International Corporation (CSIC) for collection. CSIC filed a claim in conciliation court, but the Woodwards did not receive notice as the summons was sent to their previous address. CSIC obtained a default judgment and attempted to garnish the Woodwards' wages. The Woodwards hired attorney Kevin Giebel, who filed a lawsuit claiming violations of Minnesota garnishment laws and the Fair Debt Collection Practices Act (FDCPA). CSIC and Muske removed the case to federal court and offered a judgment of $2,002.00 plus reasonable attorney’s fees and costs, which the Woodwards accepted.The United States District Court for the District of Minnesota granted the Woodwards' motion for attorney’s fees in part, awarding $12,075.00 out of the $29,139.00 sought. The court used the lodestar method to determine the reasonable fee, concluding that $350 per hour was appropriate and that only 34.5 of the 72.4 hours claimed were reasonable. The Woodwards requested permission to file a motion for reconsideration, which the court denied, stating that the request did not meet the standard for reconsideration and merely reargued previously considered matters.The United States Court of Appeals for the Eighth Circuit affirmed the district court's decision. The appellate court found no merit in the Woodwards' arguments regarding the denial of their initial motion for attorney’s fees, the reduction of the hourly rate, and the number of hours deemed reasonable. The appellate court concluded that the district court did not abuse its discretion in its rulings and that the fee award was appropriate given the circumstances of the case. View "Woodward v. Credit Service Intl. Corp." on Justia Law

Diana Delgado owed money on a department store credit card, and Midland Credit Management, Inc. purchased the debt and sued her in Minnesota state court. Delgado did not respond to the summons, leading to a default judgment in favor of Midland. Instead of seeking reconsideration or appealing the default judgment, Delgado filed a federal lawsuit against Midland, alleging violations of the Fair Debt Collection Practices Act, including that Midland tried to collect the debt without owning it.The United States District Court for the District of Minnesota dismissed Delgado's case, concluding that the issue of debt ownership had already been resolved in the state-court action and gave the default judgment issue-preclusive effect. Delgado appealed the decision.The United States Court of Appeals for the Eighth Circuit reviewed the case de novo. The court held that a Minnesota state-court default judgment can have issue-preclusive effect in a subsequent federal lawsuit. The court relied on the Minnesota Supreme Court's decision in Herreid v. Deaver, which established that a default judgment is conclusive on the facts essential to its existence, even if the defendant did not participate in the proceedings. The court found that Midland's ownership of the debt was essential to the default judgment and that Delgado had a full and fair opportunity to contest the issue in state court.The Eighth Circuit affirmed the district court's judgment, concluding that the default judgment was a final determination on the merits and that applying collateral estoppel did not work an injustice in this case. View "Delgado v. Midland Credit Mgmt., Inc." on Justia Law

Lillian Vogt purchased a used van from a dealer and later discovered that the dealer had bought the van from a representative of Progressive Casualty Insurance Company. The van had been classified as a total loss by Progressive but was sold with a clean title instead of a salvage title. Vogt believed that Progressive had mistitled the van and filed claims of fraud, negligent misrepresentation, negligence, and negligence per se against the company. She also sought to certify two classes of individuals who purchased and owned vehicles that Progressive allegedly mistitled in the same manner.The United States District Court for the Eastern District of Missouri denied class certification for both classes. The court concluded that issues common to the putative class members would not predominate over member-specific issues of reliance or causation. Vogt was granted leave to appeal this decision.The United States Court of Appeals for the Eighth Circuit reviewed the district court’s denial of class certification for abuse of discretion. The appellate court agreed with the district court, affirming its decision. The court held that the fraud and negligent misrepresentation claims required proof of reliance, which was a member-specific question unsuitable for class treatment. Similarly, the negligence and negligence per se claims required proof of causation, which also entailed proof of reliance. The court concluded that individualized inquiries into each putative class member’s reasons for purchasing their vehicles would be necessary, making class certification inappropriate. The decision of the district court was affirmed. View "Vogt v. Progressive Casualty Insurance Company" on Justia Law

John Doe filed a putative class action against SSM Health Care Corporation in Missouri state court, alleging that SSM shared private health information with third-party marketing services without authorization, violating Missouri law. Doe claimed that SSM's MyChart patient portal transmitted personal health data to third-party websites like Facebook. The lawsuit included nine state law claims, such as violations of the Missouri Wiretap Statute and the Computer Tampering Act.SSM removed the case to federal court, citing the federal officer removal statute and the Class Action Fairness Act (CAFA). Doe moved to remand the case to state court. The United States District Court for the Eastern District of Missouri rejected SSM's arguments, ruling that SSM was not "acting under" a federal officer and that Doe's proposed class was limited to Missouri citizens, thus lacking the minimal diversity required under CAFA. The district court remanded the case to state court.The United States Court of Appeals for the Eighth Circuit reviewed the case de novo. The court affirmed the district court's decision, holding that SSM did not meet the criteria for federal officer removal because it was not acting under the direction of a federal officer. The court also held that the proposed class was limited to Missouri citizens, which destroyed the minimal diversity necessary for CAFA jurisdiction. Consequently, the Eighth Circuit affirmed the district court's remand order. View "Doe v. SSM Health Care Corporation" on Justia Law

Plaintiff filed suit against Fairview, alleging that the company made unauthorized telemarketing calls in violation of the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227. The Eighth Circuit affirmed the district court's grant of Fairview's motion to dismiss, holding that whether consent is an affirmative defense is irrelevant to the Rule 12(b)(6) inquiry; the exhibits at issue were documents embraced by the pleadings that may be considered by the court; the district court did not commit plain error in concluding that the documents were properly authenticated documents reflecting an aspect of the parties' contractual relationship; given the contractual relationship alleged in the complaint, the district court did not err in considering the documents as reflecting plaintiff's pre-purchase consent; and Fairview's telemarketing calls were within the scope of the consent established. View "Zean v. Fairview Health Services" on Justia Law

Jeannie K. May filed suit seeking to recover damages under state and federal law arising from the debt-collection practices of Nationstar. After a jury found in favor of May on her invasion-of-privacy claim and her claim that Nationstar negligently violated the Fair Credit Reporting Act (FCRA), 15 U.S.C. 1681, the jury awarded May compensatory damages on both claims and punitive damages on her invasion-of-privacy claim. The court concluded that there was ample evidence to support the jury's award of punitive damages and Nationstar's renewed assertions that it acted in good faith provided no legal basis to vacate the jury's verdict. In this case, the record reflected that May contacted Nationstar repeatedly in order to resolve the issue with her account; rather than suspend its efforts based on its erroneous assessment of her debt, Nationstar aggressively pursued collection, posted May's home for foreclosure and conducted inspections of her residence; Nationstar employees spoke to May in a mocking and sarcastic manner; and May suffered physical ailments from the stress caused by Nationstar's conduct. The court concluded that the $400,000 punitive damages award was not unconstitutionally excessive because of the reprehensible nature of Nationstar's conduct; the 8-to-1 ratio of the award was not unconstitutionally excessive; and the award did not violate due process. The court also concluded that the district court did not err by excluding the testimony of another borrower; and the jury instruction regarding the Real Estate Settlement Procedures Act (RESPA), 26 U.S.C. 2601, was not plainly erroneous. Accordingly, the court affirmed the judgment. View "May v. Nationstar Mortgage, LLC" on Justia Law

These consolidated appeals stem from a class action suit against Target after the retailer announced a security breach by third-party intruders that compromised the payment card data and personal information of millions of customers. Class member Leif Olson challenges the class certification for lack of adequate representation due to an alleged intraclass conflict; class member Jim Sciaroni challenges the district court’s approval of the settlement agreement; and both challenge the district court’s order requiring them to post a bond of $49,156 to cover the costs of this appeal. The court held that the district court abused its discretion by failing to rigorously analyze the propriety of certification, especially once new arguments challenging the adequacy of representation were raised after preliminary certification. Therefore, the court remanded for the district court to conduct and articulate a rigorous analysis of Federal Rule of Civil Procedure 23(a)'s certification prerequisites as applied to this case. The court also concluded that costs associated with delays in administering a class action settlement for the length of a class member’s appeal may not be included in an appeal bond under Federal Rule of Appellate Procedure 7. Therefore, the court reversed and remanded for the district court to reduce the Rule 7 bond to reflect only those costs that Appellees will recover should they succeed in any issues remaining on appeal following the district court’s reconsideration of class certification. View "Sciaroni v. Target Corp." on Justia Law

Plaintiffs filed suit against Bank of America, alleging that Bank of America failed to provide necessary disclosures in violation of the Truth in Lending Act (TILA), 15 U.S.C. 1601 et seq. The district court agreed with defendants that the loan at issue was a residential mortgage transaction to which section 1635(a) did not apply. Therefore, the notice of rescission plaintiffs sent to Bank of America in February 2011 could not cancel the loan or provide a basis for wrongful foreclosure and quiet title actions. The district court determined that even if defendants had been required to provide disclosures under the TILA, any claim for damages would have been barred by its one-year statute of limitations. The court concluded that, based on the plain language of the statute, a residential mortgage transaction is not entitled to the right of rescission under section 1635(a). The court rejected plaintiffs' remaining claims and affirmed the judgment. View "Dunn v. Bank of America N.A." on Justia Law

Plaintiff filed suit against Rodenburg, a debt collection law firm, alleging violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692d-f. The court concluded that Rodenburg reasonably believed that plaintiff had not provided a complete response to his prior communication with defendant and thus section 1692(b)(3) permitted a call back. The court agreed with the district court that it was objectively reasonable for Rodenburg to believe that plaintiff, as the parent, had or could obtain location information about his daughter, Alexis, permitting a follow-up call to learn if he had acquired or was now willing to provide “correct or complete location information.” The court also agreed with the district court that there is no material factual dispute as to the section 1692d(5) claim because Rodenburg’s conduct did not rise to the level of harassment as a matter of law. Accordingly, the court affirmed the judgment. View "Kuntz v. Rodenburg LLP" on Justia Law

Plaintiff filed suit against PRA, a debt collector, and its attorneys, Gamache, under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692 et seq. The district court granted defendants' motion for judgment on the pleadings under Fed. R. Civ. P. 12(c). The court concluded that nothing inherent in the process of charging off a debt precludes a claim for statutory interest, and Missouri’s prejudgment interest statute does not expressly preclude statutory prejudgment interest following a waiver of contractual interest. Therefore, defendants' demands for such interest were not actionable misrepresentations or unfair or unconscionable collection methods under sections 1692e or 1692f. Because the court held that the original creditors’ acts of charging off the debts did not effectuate waivers of statutory interest, the assignments of the debt to PRA did not “create” the entitlement to statutory prejudgment interest. The court concluded that the assignments merely transferred any entitlement to such interest that otherwise existed. The court further concluded that any demand requirement that exists as a precondition to the accrual of statutory prejudgment interest was satisfied by the original creditors’ demands upon plaintiff. The court held that there exists no de minimis exception to FDCPA liability based upon low dollar amounts; and debt collectors’ false representations about the availability of remedies or amounts owed under state law, like representations of fact, are to be viewed through the unsophisticated-consumer standard and may be actionable pursuant to the FDCPA. Applying these holdings to the present case, the court concluded that plaintiff has articulated viable section 1692e and 1692f(1) claims by alleging false statements and collection attempts regarding the availability of compound interest. Accordingly, the court reversed as to these claims, rejected plaintiff's remaining claims, and affirmed in all other respects. View "Haney v. Portfolio Recovery Assoc." on Justia Law