Articles Posted in US Court of Appeals for the Second Circuit

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The Second Circuit affirmed the district court's judgment in an action filed by seven former participants in online discount membership programs, alleging that Trilegiant conspired with e‐merchant retailers such as Buy.com, Orbitz, and Priceline to enroll the retailers' customers in the membership programs via deceptive post‐transaction marketing and datapass techniques. The court held that prohibitions on the Electronic Communications Privacy Act did not apply in this case because plaintiffs failed to raise a material issue of fact as to whether they consented to enrollment in the membership programs. Therefore, the court affirmed the grant of summary judgment as to that claim. The court affirmed the dismissal of the racketeering claim, holding that plaintiffs could not proceed on a theory of racketeering because they did not identify an actionable fraud. Finally, the court affirmed the grant of summary judgment on the Connecticut Unfair Trade Practices Act and unjust enrichment claims, holding that plaintiffs have not shown that they were entitled to a refund of membership fees and Trilegiant was not unjustly enriched by not issuing the refunds. View "Williams v. Affinion Group, LLC" on Justia Law

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A collection notice that fails to disclose that interest and fees are not currently accruing on a debt is not misleading within the meaning of Section 1692e of the Fair Debt Collection Practices Act. The Second Circuit affirmed the district court's grant of summary judgment for Financial Recovery Services (FRS) in an action alleging that debt collection notices plaintiff received were "misleading" in violation of Section 1692 because the notices did not indicate whether their debts were accruing interest and fees. The court held that if a collection notice correctly states a consumer's balance without mentioning interest or fees, and no such interest or fees are accruing, then the notice will neither be misleading within the meaning of Section 1692e, nor fail to state accurately the amount of the debt under Section 1692g. If instead the notice contains no mention of interest or fees, and they are accruing, then the notice will run afoul of the requirements of both Section 1692e and Section 1692g. View "Taylor v. Financial Recovery Services, Inc." on Justia Law

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The Second Circuit affirmed the district court's grant of defendant's motion for judgment on the pleadings in an action alleging that defendant violated the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227. The court held that a flu shot reminder text message sent by a hospital did not violate the TCPA because the text fell within the scope of plaintiff's prior express consent. In this case, plaintiff provided defendant with his cell phone number when he first visited the hospital; signed a consent form acknowledging receipt of various privacy notices; in signing the form, agreed that the hospital could share his information for "treatment" purposes; and the privacy notices stated that defendant could use plaintiff's information to recommend possible treatment alternatives or health-related benefits and services. View "Latner v. Mt. Sinai Health System, Inc." on Justia Law

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On remand from the Supreme Court, the Second Circuit certified the following question to the New York Court of Appeals: Does a merchant comply with New York's General Business Law 518 so long as the merchant posts the total‐dollars‐and‐cents price charged to credit card users? View "Expressions Hair Design v. Schneiderman" on Justia Law

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A debt collector engages in unfair or unconscionable litigation conduct in violation of section 1692f when, as alleged here, it in bad faith unduly prolongs legal proceedings or requires a consumer to appear at an unnecessary hearing. The Second Circuit vacated the district court's dismissal of an action alleging that GMBS violated sections 1692e and 1692f of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692e and 1692f, when it garnished plaintiff's bank account and then tried to block him from showing that all of the funds in his account were exempt from garnishment. In this case, GMBS was alleged to have violated each section based on different conduct: section 1692e based on the false statements made in GMBS's affirmation, and section 1692f based on GMBS's objection to plaintiff's exemption claim when it allegedly knew there was no legally sufficient basis to do so. The court held that the complaint stated a claim under sections 1692e and 1692f. View "Arias v. Gutman, Mintz, Baker & Sonnenfeldt LLP" on Justia Law

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Plaintiff filed suit against defendants, alleging willful violations of the Fair and Accurate Credit Transactions Act of 2003 (FACTA), 15 U.S.C. 1681c(g). Section 1681c(g) seeks to reduce the risk of identity theft by, among other things, prohibiting merchants from including more than the final five digits of a customer’s credit card number on a printed receipt. The Second Circuit affirmed the district court's dismissal of plaintiff's second amended complaint for lack of subject matter jurisdiction. The court held that the parties' factual disagreement as to whether printing the first six digits constituted a material risk of harm was a question of fact even at the Rule 12(b)(1) motion‐to‐dismiss stage, and so the court reviewed the district court's finding for clear error. On the basis of the record and plaintiffs' affirmative burden to establish subject matter jurisdiction by a preponderance of the evidence, and informed by the findings of other district courts as to this specific issue, the court concluded that the district court's findings were not clearly erroneous. The court held, however, that a complaint must be dismissed without prejudice where the dismissal was due to the court's lack of subject matter jurisdiction. Therefore, the court remanded so that the district court may amend the judgment and enter the dismissal without prejudice. View "Katz v. The Donna Karan Company, LLC" on Justia Law

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Guided by unambiguous statutory language in the Fair and Accurate Credit Transactions Act of 2003 (FACTA), 15 U.S.C. 1681c(g), that a receipt with a credit card expiration date does not raise a material risk of identity theft, and finding that the bare procedural violation alleged by plaintiff does not present a material risk of harm, the Second Circuit held that allegations in her amended complaint did not satisfy the injury‐in‐fact requirement necessary to establish Article III standing to bring suit. Accordingly, the court affirmed the district court's dismissal of the complaint based on lack of standing. View "Crupar-Weinmann v. Paris Baguette America, Inc." on Justia Law

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Plaintiff filed suit against Lincoln, alleging violations of the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227. The Second Circuit affirmed the district court's grant of summary judgment for Lincoln, holding that plaintiff did introduce sufficient evidence from which a jury could conclude that he revoked his consent, but that the TCPA does not permit a consumer to revoke its consent to be called when that consent forms part of a bargained‐for exchange. In this case, plaintiff's consent was not provided gratuitously, it was included as an express provision of a contract to lease an automobile from Lincoln. View "Reyes v. Lincoln Automotive Financial Services" on Justia Law

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Plaintiff filed a putative class action alleging that grocery stores in New York operated by Whole Foods systematically overstated the weights of pre‐packaged food products and overcharged customers as a result.  The district court dismissed the complaint based on plaintiff's lack of Article III standing. The Second Circuit vacated and remanded, holding that the district court did not draw all reasonable inferences in plaintiff's favor. In this case, plaintiff plausibly alleged a nontrivial economic injury sufficient to support standing. According to the DCA's investigation, Whole Foods packages of cheese and cupcakes were systematically and routinely mislabeled and overpriced, and plaintiff regularly purchased Whole Foods packages of cheese and cupcakes throughout the relevant period. Therefore, the complaint satisfied the low threshold required to plead injury in fact. View "John v. Whole Foods Market Group" on Justia Law