Justia Consumer Law Opinion Summaries

Smith’s husband obtained a Capital One credit card that he used for family consumer debts. Smith subsequently filed for bankruptcy. Smith’s husband did not join Smith’s petition and was not listed as a co‐debtor. The bankruptcy court confirmed Smith’s Chapter 13 plan. During Smith’s repayment period, Capital One, through attorney Kohn, sued Smith’s husband and obtained a Wisconsin state court judgment for amounts owed on his credit card; it has not attempted to enforce the judgment. Smith initiated a successful bankruptcy court adversary proceeding, arguing that Smith’s husband’s credit card debt was covered by the co‐debtor stay due under Wisconsin marital law and alleging violations of the co‐debtor stay, 11 U.S.C. 1301(a); the Wisconsin Consumer Act; and the Fair Debt Collection Practices Act, 15 U.S.C. 1692(d)(e). The district court reversed, holding that “consumer debt of the debtor” does not include a debt for which the debtor is not personally liable but that may be satisfied from the debtor’s interest in marital property. The Seventh Circuit affirmed. Smith’s suggested expansion of the co‐debtor stay is contrary to its plain meaning and purpose, which is to prevent undue pressure that creditors could otherwise exert by threatening action against third-parties who have co‐signed the debtor’s debts. View "Smith v. Capital One Bank (USA), N.A." on Justia Law

On February 10, 2015, Meyers was given a copy of his receipt after dining at Nicolet Restaurant in de Pere, Wisconsin. He noticed that Nicolet’s receipt did not truncate the expiration date, as required by the Fair and Accurate Credit Transactions Act (FACTA), 15 U.S.C. 1681. Meyers filed a putative class action, purportedly on behalf of everyone who had been provided a non‐compliant receipt at Nicolet, seeking only statutory damages. The district court denied Meyers’ motion for class certification, holding that Meyers had satisfied FRCP 23(a)’s four prerequisites, but failed to establish that class‐wide issues would “predominate” over issues affecting only individual potential class members. Fed R. Civ. P. 23(b)(3)). In a separate suit, the Seventh Circuit affirmed that sovereign immunity barred Meyers’ claim against the Oneida Tribe, the owner of the restaurant. The Seventh Circuit then held that Meyers lacked standing in his suit against the restaurant. Violation of a statute, completely divorced from any potential real‐world harm, is not sufficient to satisfy Article III’s injury‐in‐fact requirement so, the district court lacked authority to certify a class action. View "Meyers v. Nicolet Restaurant of DePere, LLC" on Justia Law

TransUnion prepared a credit report which revealed, based on information obtained from Toyota, that Brill was in arrears on an extension of a vehicle lease. Brill claimed that his signature was forged by a former girlfriend. He demanded that TransUnion “conduct a reasonable reinvestigation” under the Fair Credit Reporting Act, 15 U.S.C. 1681i(a)(1)(A). At TransUnion's request, Toyota confirmed that the name on the extension was Brill; it did not try, and was not asked to try, to determine whether the signature was a forgery. The Seventh Circuit affirmed dismissal of Brill’s suit against Transunion. TransUnion had no duty to verify the accuracy of Brill’s signature. Toyota was in a better position to determine the validity of its own lease. It would be unrealistic to expect Transunion to verify the signature by communication with the Toyota employees who handled the transaction. Forcing a credit reporting agency to hire a handwriting expert in every case of alleged forgery would impose an expense disproportionate to the likelihood of an accurate conclusion. The Act’s identity-theft provisions call for a report to the police before turning to the credit reporting agency. Brill apparently made no such report. The court noted that Brill sued Toyota; the parties settled, under terms that are confidential, so it is not clear whether Brill has cleared the cloud on his credit. View "Brill v. TransUnion LLC" on Justia Law

Meyers used his credit card to make purchases at the Green Bay are Oneida Travel Center and Oneida One Stop retail locations, owned and operated by the federally‐recognized Oneida Indian tribe. He received electronically printed receipts that included more than the last five digits of his credit card and the card’s expiration date. He alleged, in a putative class action, that the Tribe issued these receipts in violation of the Fair and Accurate Credit Transaction Act, which states: [n]o person that accepts credit cards or debit cards for the transaction of business shall print more than the last 5 digits of the card number or the expiration date upon any receipt provided to the cardholder at the point of the sale or transaction, 15 U.S.C. 1681c(g)(1). FACTA defines a person as “any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.” The district court concluded that the Tribe was immune from suit. The Seventh Circuit affirmed, noting that whether a tribe is subject to a statute and whether the tribe may be sued for violating the statute are two different questions. Any ambiguity must be resolved in favor of immunity; “government or governmental subdivision or agency” does not unambiguously refer to tribes. View "Meyers v. Oneida Tribe of Indians of Wis." on Justia Law

Plaintiffs filed a purported class action against Moscov, his law firm Weinstein, Pinson & Riley, and a debt collection agency NCO Financial, alleging violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692, arising out of attempts to collect on student loan debts allegedly owed by the plaintiffs. The complaint asserted that the defendants included a misleading and deceptive statement in a paragraph of the debt-collection complaint they filed against the plaintiffs in state court: Pursuant to 11 U.S.C. 1692g(a), Defendants are informed that the undersigned law firm is acting on behalf of Plaintiff to collect the debt and that the debt referenced in this suit will be assumed to be valid and correct if not disputed in whole or in part within thirty (30) days from the date hereof. Plaintiffs claimed that the statement was misleading and deceptive as to the manner and timing of their response to the state lawsuit. The district court dismissed. The Seventh Circuit reversed and remanded, finding that the statements fall within the category: communications which are plainly deceptive and misleading to an unsophisticated consumer as a matter of law. View "Marquez v. Weinstein, Pinson & Riley, P.S" on Justia Law

Plaintiffs each purportedly owed a debt; each creditor filed suit in Cook County seeking to collect on that debt. After each plaintiff failed to appear, a Cook County Circuit Court entered a default judgment. B&G, a debt collector, filed an affidavit for a wage deduction in the First Municipal District in downtown Chicago and obtained a summons against Plaintiffs’ respective employers. Plaintiffs allege it was this final act that violated the Fair Debt Collection Practices Act (FDCPA) venue provision, 15 U.S.C. 1692i(a)(2), because B&G should have filed the affidavits in the Sixth Municipal District in Markham, Illinois (the municipal district closest to Plaintiffs) and not in the First Municipal District. The Cook County Circuit Court’s Municipal Department has been sub‐divided into six smaller units called municipal districts. B&G moved to dismiss on the basis that B&G’s filing of an affidavit for a wage deduction did not constitute a “legal action” against a “consumer” within the meaning of the FDCPA. The district courts agreed. The Seventh Circuit affirmed, holding that such actions are not against the consumer. View "Etro v. Blitt & Gaines, P.C." on Justia Law

Franklin and Chism parked their cars in a Chicago-area lot owned by Metra, the public commuter railroad, and operated by CPS. The lot offers parking spaces to the public for $1.50 per day. CPS says the two failed to pay and sent them violation notices demanding payment of the $1.50 fee and a $45 nonpayment penalty. When they still did not pay, CPS referred the matter for collection to Parking Revenue, which sent them collection letters for the $46.50 . Franklin and Chism filed a class action against Parking Revenue alleging violations of the Fair Debt Collection Practices Act, 15 U.S.C. 1692. The district court entered summary judgment for Parking Revenue, holding that the FDCPA does not apply because the unpaid parking obligations are not “debts” as that term is defined in section 1692a(5). The Seventh Circuit reversed. The obligations at issue are “debts” within the meaning of the FDCPA. That statutory term comprises obligations “arising out of” consumer “transactions.” Parking in a lot that is open to all customers subject to stated charges is a “transaction.” The obligation that arises from that transaction is a “debt,” and an attempt to collect it must comply with the FDCPA. View "Franklin v. Parking Revenue Recovery Servs., Inc." on Justia Law

In each of three cases, a debtor filed for Chapter 13 bankruptcy, represented by counsel. During the bankruptcy proceedings, a debt collector submitted a proof of claim for a “stale” debt, for which the statute of limitations had expired. As required by Bankruptcy Rule 3001, the proof of claim filed by the debt collector accurately noted the origin of the debt, the date of the last payment, and the date of the last transaction. Each debtor objected to the claim; each was disallowed and eventually discharged. Each debtor brought a separate suit against the debt collector, alleging that the act of filing a proof of claim on a time‐barred debt constituted a false, deceptive, misleading, unfair, or unconscionable means of collecting a debt in violation of the Fair Debt Collection Practices Act, 15 U.S.C. 1692. The Seventh Circuit affirmed dismissal of the cases. The debt collectors’ conduct was not deceptive or misleading. The information contained in the proof of claim was not misleading, but set forth accurate and complete information about the status of the debts. View "Owens v. LVNV Funding, LLC" on Justia Law

The Blatt firm filed a collection lawsuit against Oliva in the first municipal district of the Circuit Court of Cook County. Oliva resided in Cook County. Under the Seventh Circuit’s 1996 “Newsom” decision, interpreting the Fair Debt Collection Practices Act (FDCPA) venue provision, debt collectors were allowed to file suit in any of Cook County’s municipal districts if the debtor resided in Cook County or signed the underlying contract there. While the Oliva suit was pending, the Seventh Circuit overruled Newsom, with retroactive effect (Suesz, 2014). One week later, Blatt voluntarily dismissed the suit. Oliva sued Blatt for violating the FDCPA’s venue provision as newly interpreted by Suesz. The district court granted Blatt summary judgment, finding that it relied on Newsom in good faith and was immune from liability under the FDCPA’s bona fide error defense, 15 U.S.C. 1692k(c), which precludes liability for unintentional violations resulting from a good‐faith mistake. The Seventh Circuit affirmed, rejecting an argument that the defense should not apply because the firm’s violation resulted from its mistaken interpretation of the law. In relying on Newsom, the firm simply followed the circuit's controlling law; its failure to foresee the retroactive change of law was not a mistaken legal interpretation, but an unintentional bona fide error View "Oliva v. Blatt, Hasenmiller, Leibsker & Moore, LLC" on Justia Law

The Fair Debt Collection Practices Act prohibits debt collectors from threatening to take an action that they do not intend to take in the course of collecting a debt, 15 U.S.C. 1692e(5). The defendants, debt collectors, filed suit in Illinois state court to recover on the plaintiffs’ delinquent credit card accounts, but later moved to voluntarily dismiss the actions without prejudice. The actions were dismissed before trial. The plaintiffs then sued the debt collectors for allegedly engaging in various deceptive practices under the FDCPA during the state court litigation. The Seventh Circuit affirmed dismissal. Section 1692e(5) of the FDCPA does not require debt collectors to intend to proceed to trial when filing a lawsuit to recover a debt. View "Owusumensah v. Cavalry Portfolio Servs., LLC" on Justia Law