Articles Posted in US Court of Appeals for the Second Circuit

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When a debt collector misreports a debt obligation to a consumer that she no longer owes, and requests payment on that debt, the consumer plausibly alleges violations of 15 U.S.C. 1692e and 1692f, notwithstanding the fact that the debt collector advised the consumer of her right to dispute the debt as required by section 1692g, and that the consumer did not exercise that right.      The Second Circuit vacated the district court's dismissal of plaintiff's complaint, alleging violations of the Fair Debt Collection Practices Act when defendant used false representations and unfair practices in seeking payment on an already settled debt. The court held that plaintiff alleged plausible FDCPA claims. In this case, the inclusion of section 1692g notice did not prevent plaintiff from plausibly pleading that, on a least sophisticated consumer standard, defendant's debt communication was misleading and unfair. The court explained that the FDCPA was a strict liability statute, and a consumer was not required to plead mens rea to state plausible FDCPA claims. Instead, a debt collector's intent was relevant as an element of the affirmative defense afforded by section 1692k(c). View "Vangorden v. Second Round, LP" on Justia Law

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Johnson & Johnson appealed the district court's certification of a class of consumers who purchased baby products in an action alleging that the company violated the Connecticut Unfair Trade Practices Act (CUTPA), as well as other state consumer protection laws, when it labeled its baby products as "natural" when they were not. The Second Circuit held that, although plaintiff had Article III standing, it was not clear on the record whether the district court undertook the requisite analysis of the material differences in the state laws at issue before concluding that their similarities predominated over their differences. Therefore, the court vacated the district court's grant of certification and remanded for further proceedings. View "Langan v. Johnson & Johnson Consumer Cos." on Justia Law

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The Second Circuit affirmed the district court's judgment in favor of defendants in an action alleging that defendants violated the Fair Debt Collection Practices Act, 15 U.S.C. 1692 et seq., in connection with their attempt to initiate foreclosure proceedings on his home. The court held that, although the district court erred in dismissing plaintiff's claims on the ground that the enforcement of a security interest through foreclosure proceedings was not debt collection for purposes of the Act, defendant failed to plausibly allege that defendants violated the FDCPA. The court held that the mortgage foreclosure, at least under the circumstances here, constituted debt collection under the Act. However, the court also held that defendantsʹ identification of Green Tree as the creditor was not deceptive as to the nature or legal status of plaintiffʹs debt, nor would it have prevented the least sophisticated consumer from responding to or disputing the action. Finally, plaintiff's 15 U.S.C. 1692g claim was properly dismissed because the Certificate of Merit fell within section 1692g(d)ʹs pleading exclusion, and was therefore not an initial communication, because defendants were legally obligated to file this document with the foreclosure complaint. View "Cohen v. Rosicki, Rosicki & Assocs., P.C." on Justia Law

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The Second Circuit affirmed the district court's judgment in an action brought by plaintiff against Midland, alleging that they violated the Fair Debt Collection Practices Act (FDCPA). The court held that the district court did not err by granting summary judgment in favor of Midland, because there were no genuine questions of fact as to whether a Midland employee purposefully overwhelmed him with harassing questions or misled him with her questions in violation of section 1692e of the FDCPA. Summary judgment was also properly granted as to plaintiff's claim that Midland violated section 1692e(8), which required debt collectors to communicate that a disputed debt was disputed. The court also held that the district court did not abuse its discretion by sanctioning plaintiff's attorney for misleading the court during the initial status conference, plaintiff for disregarding a protective order, and both plaintiff and the law firm for needlessly multiplying proceedings. View "Huebner v. Midland Credit Management" on Justia Law

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The Second Circuit reversed the district court's grant of partial summary judgment for plaintiff on her claim that Time Warner knowingly or willfully violated the Telephone Consumer Protection Act of 1991, 47 U.S.C. 227, by using an "automatic telephone dialing system" to call her cell phone 153 times without her consent. The court held that the district court's analysis was based on an incorrect interpretation of the statutory text where the district court relied primarily on a Declaratory Ruling and Order issued by the FCC in 2015 that has since been invalidated by the D.C. Circuit. When the court considered the statute independently, without an administrative interpretation to defer to, the best interpretation of the statutory language was the one suggested by the D.C. Circuit's discussion in ACA Int'l v. FCC, 885 F.3d 687, 699 (D.C. Cir. 2018): in the TCPA's definition of an autodialer, a device's "capacity" referred to its current functions absent additional modifications, regardless of whether those functions were in use during the offending call. Accordingly, the court remanded for the district court to develop the factual record and to apply the appropriate standard. View "King v. Time Warner Cable Inc." on Justia Law

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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