Justia Consumer Law Opinion Summaries

The dispute centers on allegations by a Minnesota-based health insurer that several related pharmaceutical companies carried out an unlawful scheme involving the distribution and sale of repackaged and adulterated oncology drugs. The scheme allegedly involved breaking sterile seals on medication vials, pooling overfill amounts—which were not intended for patient use—and creating pre-filled syringes that were then sold to healthcare providers. These syringes were ultimately administered to cancer patients, including many insured under programs operated by the plaintiff. The defendants did not themselves submit claims for reimbursement, but the plaintiff asserts it paid for treatments using these adulterated drugs, unaware of their compromised quality.Prior to this lawsuit, the scheme was the subject of other civil actions and federal investigations, including qui tam actions and a federal criminal prosecution. The defendants disclosed these investigations in annual reports filed with the Securities and Exchange Commission and the events received media attention beginning in 2012. In 2017, a related company pleaded guilty to federal charges, admitting to the repackaging scheme, and paid significant fines and settlements. The plaintiff filed suit in 2023, asserting claims for common-law fraud, unjust enrichment, and violations of several Minnesota consumer protection statutes. The United States District Court for the District of Minnesota dismissed the complaint, finding the claims were barred by the applicable six-year statute of limitations, and that the plaintiff had failed to sufficiently plead fraudulent concealment to toll the limitations period.The United States Court of Appeals for the Eighth Circuit reviewed the district court’s dismissal de novo. It concluded that publicly available disclosures and the plaintiff’s own allegations established that the plaintiff should have discovered its causes of action no later than 2016. Because the plaintiff did not file suit until 2023, its claims were untimely. The court affirmed the district court’s judgment, holding that all claims were barred by the statute of limitations. View "United HealthCare Services, Inc. v. AmerisourceBergen Corporation" on Justia Law

Austin Stuart Fraase applied for a full-time maintenance technician position with Fargo Parks District. During the hiring process, Fargo Parks ordered a background check from Advantage Credit Bureau, which incorrectly reported that Austin had a speeding conviction. In reality, the ticket belonged to his twin brother, Aaron Stuart Fraase. The criminal search section of the report listed the conviction, though the motor vehicle section showed a clean record. Fargo Parks’ human resources staff discussed the report with Austin and his supervisor, ultimately concluding that the ticket likely belonged to his brother. Austin was reassured that it would not affect his interview or hiring, and he accepted and began the job as scheduled. Advantage sent Austin notices of his right to dispute the report, but he chose instead to file suit under the Fair Credit Reporting Act.The United States District Court for the District of North Dakota granted summary judgment to Advantage. The court concluded that Advantage had used reasonable procedures by searching the official North Dakota Courts website with Austin’s identifying information and reporting the results, and that Austin suffered no damages as he was hired without delay or loss.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed the case de novo and affirmed the district court’s judgment. The Eighth Circuit held that Advantage’s reliance on the official court website as a reputable source was reasonable under the Fair Credit Reporting Act. The court found no evidence of systemic problems with the website or that Advantage failed to follow its own procedures. Thus, Advantage was not liable for the inaccurate report. The court did not address whether Austin suffered actual damages, as it found no violation of the statute. The district court's grant of summary judgment was affirmed. View "Fraase v. Advantage Credit Bureau" on Justia Law

The plaintiffs, a Black family residing in Nebraska, visited the Kiewit Luminarium, an institution operated by Omaha Discovery Trust. They paid the full admission price for entry in February 2024. The Luminarium had a policy granting free admission to registered members of federally recognized Native American tribes and their household members. After learning of this policy, the plaintiffs sought a refund for their tickets, which was denied. They then filed suit, alleging that the policy constituted unlawful racial discrimination in violation of federal civil rights statutes and the Nebraska Consumer Protection Act.The United States District Court for the District of Nebraska reviewed the complaint after the defendant moved to dismiss. The district court granted the motion to dismiss on all claims. It reasoned that the Luminarium’s policy distinguished based on tribal membership, which is a political classification rather than a racial one. As a result, the court concluded the plaintiffs failed to state a claim for race discrimination under the relevant federal statutes and that their Nebraska Consumer Protection Act claim failed for the same reason.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed the district court’s dismissal de novo. The Eighth Circuit affirmed the district court’s judgment. The appellate court held that membership in a federally recognized tribe is a political classification, not a racial one, relying on Supreme Court and circuit precedent. The court determined the plaintiffs did not plead facts showing they were discriminated against because of their race. Because their claims under 42 U.S.C. §§ 2000a, 2000a-2, 1981, and 1982, as well as under the Nebraska Consumer Protection Act, all depended on a showing of racial discrimination, the Eighth Circuit affirmed dismissal of all claims. View "Nare v. Omaha Discovery Trust" on Justia Law

After Doris and Harold Fasching executed a mortgage with a bank in 1998, their interest in the property passed to their heirs upon their deaths in 2021. Sandra Fiecke-Stifter, one of the heirs, did not make mortgage payments as scheduled in late 2021 and early 2022, resulting in the initiation of nonjudicial foreclosure proceedings by the bank. During this period, she made several partial and full payments, some of which were credited and later refunded by the bank, and received statements with varying amounts due. After the foreclosure process began, Fiecke-Stifter requested a payoff amount from the bank’s attorney, but the amount was never provided. The property was sold at a sheriff’s auction, and Fiecke-Stifter later redeemed it by paying more than the last stated loan balance.Proceedings began in the United States District Court for the District of Minnesota, where Fiecke-Stifter alleged that the bank violated the Truth in Lending Act (TILA) by refunding previously credited payments and assessing late fees, and that the bank’s attorney violated the Fair Debt Collection Practices Act (FDCPA) by proceeding with foreclosure without a present right to possession. The district court dismissed both claims, finding there was no TILA violation because the statute only prohibits delay in crediting payments, not the return of already credited payments, and dismissed the FDCPA claim after permitting an amendment.On appeal, the United States Court of Appeals for the Eighth Circuit affirmed the dismissal of the TILA claim, holding that TILA section 1639f(a) does not prohibit a servicer from refunding payments that were initially credited. However, the court vacated the dismissal of the FDCPA claim, determining that whether the alleged failure to provide a reinstatement or payoff amount under Minnesota law equates to the absence of a “present right to possession” is a question best addressed by the district court in the first instance. The case was remanded for further proceedings on the FDCPA claim. View "Fiecke-Stifter v. MidCountry Bank" on Justia Law

ARcare, Inc., a nonprofit community health center receiving federal funding, suffered a data breach in early 2022 when an unauthorized third party accessed confidential patient information, including names, social security numbers, and medical treatment details. After ARcare notified affected individuals, several patients filed lawsuits alleging that ARcare failed to adequately safeguard their information as required under federal law. Plaintiffs reported fraudulent invoices and that their information was found for sale on the dark web.The actions were removed to the United States District Court for the Eastern District of Arkansas, where six class actions were consolidated. ARcare sought to invoke absolute immunity under 42 U.S.C. § 233(a) of the Federally Supported Health Centers Assistance Act (FSHCAA), which provides immunity for damages resulting from the performance of “medical, surgical, dental, or related functions.” ARcare moved to substitute the United States as defendant under the Federal Tort Claims Act, arguing the data breach arose from a “related function.” The district court denied the motion, finding that protecting patient information from cyberattacks was not sufficiently linked to the provision of health care to qualify as a “related function” under the statute.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed the statutory immunity issue de novo. The court affirmed the district court’s denial of immunity, holding that the FSHCAA’s language does not extend statutory immunity to claims arising from a health center’s data security practices. The court reasoned that “related functions” must be activities closely connected to the provision of health care, and data security is not such a function. Therefore, ARcare is not entitled to substitute the United States as defendant, and the denial of statutory immunity was affirmed. View "Hale v. ARcare, Inc" on Justia Law

Lea and Samantha Johnson obtained a mortgage loan serviced by Freedom Mortgage Corporation and made regular payments. After filing for bankruptcy in March 2020, they reaffirmed the loan, but were required to pay by mail and instructed to include their loan number with each payment. In April 2020, Lea mailed a cashier’s check for their monthly payment, but did not put the loan number on the check itself. Freedom Mortgage received the check but could not identify the correct account to credit, as the check did not match the payment amount and only listed Samantha’s name, a common name among its customers. As a result, the payment was not credited and the Johnsons’ account was marked past due, which was subsequently reported to credit agencies. After realizing the issue, the Johnsons sent a new check with the loan number and the payment was credited, but their credit reports reflected a late payment.The United States District Court for the District of Minnesota found there was no material dispute about the accuracy of Freedom Mortgage’s reporting and granted summary judgment to the defendant. The court determined that the payment was in fact late because the first check did not comply with the required instructions, and therefore the information reported to the credit agencies was accurate.The United States Court of Appeals for the Eighth Circuit reviewed the district court’s summary judgment order de novo. The court held that Freedom Mortgage’s investigation into the Johnsons’ credit dispute was reasonable given the conclusory nature of the dispute letters. The court also found that the reported late payment was accurate under both the standard and heightened accuracy tests, and declined to adopt a heightened standard of accuracy. The appellate court affirmed the district court’s grant of summary judgment for Freedom Mortgage. View "Johnson v. Freedom Mortgage Corp." on Justia Law

A company operating movie theaters in several Midwestern states offered free movie trailers on its website to attract customers. After a website visitor viewed these trailers, she began to receive targeted advertisements on her Facebook page. She alleged that the company had installed a program, Meta Pixel, which tracked her activity and shared her personal information with Meta (Facebook’s parent company). She claimed that the company, as a “video tape service provider,” had a duty under the Video Privacy Protection Act not to disclose her personally identifiable information without consent.The United States District Court for the District of Minnesota dismissed the complaint. The district court found that the company was not a “video tape service provider” as defined by the statute, because it was not engaged in the business of renting, selling, or delivering prerecorded video cassette tapes or similar audio visual materials. As a result, the court concluded that the company had no statutory obligation to withhold the plaintiff’s personal information under the Act.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed the district court’s dismissal de novo. The appellate court agreed with the district court, holding that movie theaters are not “engaged in the business” of renting, selling, or delivering prerecorded video cassette tapes or similar audio visual materials. The court reasoned that the statutory definition requires a physical medium similar to video cassette tapes, which does not include theatrical screenings or free online trailers. The court further determined that offering trailers online did not constitute a separate business of delivering audio visual materials for livelihood or gain. Accordingly, the Eighth Circuit affirmed the judgment of the district court. View "Christopherson v. Cinema Entertainment Corp." on Justia Law

A Missouri consumer purchased several containers of coffee that prominently displayed the number of servings each container could make. He claimed these representations were misleading, arguing that following the recommended single-serving brewing method would not produce as many servings as advertised. He filed a lawsuit against the coffee manufacturer and its parent company, alleging violations of the Missouri Merchandising Practices Act (MMPA) and unjust enrichment. The plaintiff sought to represent a class of Missouri consumers who purchased the same products.Multiple similar lawsuits from around the country were consolidated in the United States District Court for the Western District of Missouri. The district court appointed interim class counsel and, at the parties’ suggestion, considered whether to certify a Missouri class before addressing other states. The district court ultimately certified the Missouri class, finding that the plaintiff’s claims were suitable for class treatment under Federal Rule of Civil Procedure 23(b)(3), which requires that common questions predominate over individual ones.On appeal, the United States Court of Appeals for the Eighth Circuit held that the district court erred in certifying the class. The appellate court determined that individual questions about whether consumers saw, interpreted, or relied upon the product representations would predominate over common questions. The court rejected the plaintiff’s argument that all class members suffered harm due to alleged price inflation, reasoning that only those who were actually misled or cared about the representations could have incurred an ascertainable loss under the MMPA. The court also found the unjust enrichment claim similarly unsuited to class treatment because it would require individualized inquiries into whether each transaction was unjust. The Eighth Circuit reversed the class certification order and remanded the case for further proceedings. View "Sorin v. The Folger Coffee Company" on Justia Law

The plaintiff purchased products from a company’s “Sustainability Collection,” which were advertised as sustainable and environmentally friendly. She alleged that these representations were false because the products were made with virgin synthetic and non-organic materials that are harmful to the environment. The plaintiff claimed that she would not have bought the products, or would have paid less, had she known the truth. She brought a putative class action under the Missouri Merchandising Practices Act, asserting that the company’s advertising was misleading.The United States District Court for the Eastern District of Missouri first considered and dismissed the plaintiff’s initial complaint for failure to state a claim, after which she filed an amended complaint. The company again moved to dismiss, arguing that the amended complaint lacked sufficient factual support and did not plausibly allege that a reasonable consumer would be misled. The district court agreed, finding that the amended complaint failed to provide facts making the plaintiff’s claims plausible and did not meet the required pleading standards. The court dismissed the case without specifying whether the dismissal was with or without prejudice. The plaintiff then filed a post-judgment motion for reconsideration and for leave to amend, which the district court denied, citing her failure to properly request leave to amend before judgment and her delay in doing so.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed only whether the district court abused its discretion by dismissing the amended complaint with prejudice. The Eighth Circuit held that, under Federal Rule of Civil Procedure 41(b), a Rule 12(b)(6) dismissal operates as an adjudication on the merits (i.e., with prejudice) unless the order states otherwise. The court found no abuse of discretion and affirmed the district court’s judgment. View "Ellis v. Nike USA, Inc." on Justia Law

A Missouri consumer incurred a medical debt that was later assigned to a debt collection agency. Several years after the initial collection letter, the consumer sent a fax to the agency disputing the debt and requesting no further contact. In response, the agency mailed a letter verifying the debt and indicating that collection efforts would resume. The consumer then filed suit, alleging that the agency violated the Fair Debt Collection Practices Act (FDCPA) by communicating after being asked not to.The United States District Court for the Western District of Missouri reviewed cross-motions for summary judgment based on stipulated facts. The court found that the consumer had suffered a concrete injury because the unwanted letter intruded upon her seclusion and privacy. It granted summary judgment for the consumer, awarded statutory damages and attorneys’ fees, and denied the agency’s motion for reconsideration.On appeal, the United States Court of Appeals for the Eighth Circuit reviewed the district court’s standing determination de novo. The appellate court held that the consumer lacked Article III standing because she did not suffer a concrete injury. The court reasoned that the agency’s letter was a required response under the Fair Credit Reporting Act (FCRA) after the consumer disputed the debt in connection with her credit report, and that a single, invited letter verifying a debt does not amount to an intrusion upon seclusion or a highly offensive act. The Eighth Circuit vacated the district court’s judgment and remanded the case with instructions to dismiss the complaint. View "Denmon v. Kansas Counselors, Inc." on Justia Law