Justia Consumer Law Opinion Summaries

Daphne Automotive, LLC, and its employee, Robin Sanders appealed a circuit court order denying their motion to compel arbitration of the claims filed against them by Eastern Shore Neurology Clinic, Inc. ("Eastern Shore"), and Rassan Tarabein. Tarabein owned Eastern Shore and another company, Infotec, Inc. Tarabein hired his nephew, Mohamad Tarbin, as an employee of Infotec. As part of the nephew's compensation, Tarabein agreed to provide him with the use of a vehicle for as long as he was employed with Infotec. Accordingly, Tarabein purchased, through Eastern Shore, a vehicle from Daphne Automotive. Tarabein, the nephew, and the dealership agreed that the dealership would arrange for the vehicle to be titled in the nephew's name, but that Eastern Shore would be listed on the title as lienholder. In conjunction with the sale, the nephew signed the sales contract, which contained an arbitration clause. Tarabein executed only the documents to establish Eastern Shore as lienholder on the title for the vehicle. In January 2014, the Department of Revenue issued an original certificate of title for the vehicle that listed no lienholders to the nephew. A few months later, the nephew was terminated from his job with Infotec, and Tarabein attempted to take back the vehicle, but the nephew refused. According to Tarabein, the dealership never informed him that it had failed to list Eastern Shore as a lienholder on the application for the certificate of title. As a result, the nephew held title to the vehicle free and clear, and Eastern Shore held a reissued certificate of title for the same vehicle, listing it as lienholder. Eastern Short attempted to repossess the vehicle; the nephew avoided being arrested by producing the free-and-clear title to the vehicle. According to Tarabein, he became aware of the existence of the second certificate of title after the attempted arrest. Tarabein thereafter sued the dealership for a variety of claims; the dealer moved to compel arbitration. The Alabama Supreme Court concluded the dealership failed to meet its burden of proving the existence of a contract calling for arbitration: the sales contract was limited in its scope with respect to disputes arising to parties to the contract and the agreements, here, between the nephew and the dealership. Accordingly, the Court found the trial court did not err in denying the dealership’s motion to compel arbitration. View "Daphne Automotive, LLC v. Eastern Shore Neurology Clinic, Inc." on Justia Law

The Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227 et seq., permits a consumer to partially revoke her consent to be called by means of an automatic telephone dialing system. The Eleventh Circuit thought it logical that a consumer's power under the TCPA to completely withdraw consent and thereby stop all future automated calls encompasses the power to partially withdraw consent and stop calls during certain times. In this case, the court held that summary judgment was inappropriate because a reasonable jury could find that plaintiff partially revoked her consent to be called in "the morning" and "during the workday" on the October 13 phone call with a Comenity employee. Accordingly, the court reversed and remanded. View "Schweitzer v. Comenity Bank" on Justia Law

Plaintiffs filed suit against Royal under the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227, seeking to hold Royal vicariously liable for several telephone calls made by telemarketers employed by AAAP. The Ninth Circuit applied the ten non-exhaustive factors set forth in the Restatement (Second) of Agency 220(2) (1958), and found that AAAP's telemarketers were acting as independent contractors rather than as Royal's agents. Therefore, the court held that Royal was not vicariously liable for the telephone calls and the district court properly granted summary judgment in favor of Royal. View "Jones v. Royal Administration Services" on Justia Law

Over about 18 months, Groshek submitted 562 job applications to employers. The job application, which the employers provided, included a disclosure and authorization form stating that a consumer report might be procured in making the employment decision; the form also contained other information, including a liability release. After Groshek submitted the application, with the signed disclosure and authorization, the employers obtained a consumer report on him from a third party. Groshek filed a class-action suit under the Fair Credit Reporting Act, 15 U.S.C. 1681, which prohibits a prospective employer from procuring a consumer report for employment purposes unless a clear and conspicuous disclosure has been made in writing to the job applicant before the report is procured, in a document that consists solely of the disclosure. A consumer report may be obtained for employment purposes only if the applicant has authorized its procurement in writing. Groshek alleged that the violation of the "stand-alone document requirement" was willful and that, as a result, the employers failed to obtain a valid authorization before procuring a consumer report. The district court dismissed for lack of subject matter jurisdiction. The Seventh Circuit affirmed. Groshek has not alleged facts demonstrating a real, concrete appreciable risk of harm and lacks Article III standing. View "Groshek v. Great Lakes Higher Education Corp." on Justia Law

Plaintiffs filed suit against the condo owners association after the foreclosure sale of their condo unit, alleging common law claims for breach of contract, wrongful foreclosure, negligent misrepresentation, and breach of fiduciary duty, as well as violations of the Federal Debt Collection Practices Act (FDCPA), Texas Fair Debt Collection Practices Act (TFDCPA), and Texas Deceptive Trade Practices Act (TDTPA). The Fifth Circuit affirmed the district court's grant of summary judgment on all claims, holding that regardless whether the district court abused its discretion, any evidentiary error the district court made was harmless. In this case, the issue whether the late fee increase was properly adopted by the Association was not dispositive of any claims, so it did not affect the outcome of the litigation and did not affect their substantial rights. The court also held that plaintiffs' could not maintain their suit for breaches of the Condominium Declaration when they have themselves been in default of the contract; there was no authority supporting plaintiffs' conclusion that an inaccurate balance included in a default notice constitutes a defect in the foreclosure proceedings; and plaintiffs failed to cite specific negligent misrepresentations by defendants. The court rejected plaintiffs' remaining claims. View "Mahmoud v. De Moss Owners Association, Inc." on Justia Law

In 2005, Nicholas and Mary Conroy refinanced their home with a mortgage loan secured by a deed of trust on the property. Five years later, the Conroys stopped making payments and defaulted on their loan. In an effort to avoid foreclosure, the Conroys filed suit against defendants Wells Fargo Bank, N.A., successor by merger to Wells Fargo Home Mortgage, Inc.; Fidelity National Title Insurance Company aka Default Resolution Network, LLC; and HSBC Bank USA, N.A. as trustee for Merrill Lynch Mortgage Backed Securities Trust, Series 2007-2 (Wells Fargo). The trial court sustained Wells Fargo’s demurrer without leave to amend and entered a judgment of dismissal. On appeal, the Conroys contended the trial court erroneously dismissed their claims. After review, the Court of Appeal found the Conroys’ operative complaint did not state valid causes of action for intentional or negligent misrepresentation because they did not properly plead actual reliance or damages proximately caused by Wells Fargo. The trial court properly determined the Conroys could not assert a tort claim for negligence arising out of a contract with Well Fargo. For lack of detrimental reliance on any of Wells Fargo’s alleged promises, the Conroys did not set forth a viable cause of action for promissory estoppel even under a liberal construction of the operative complaint. Because Wells Fargo considered and rejected a loan modification for the Conroys before that date, section 2923.6 does not apply to them. The plain language of section 2923.7 requires a borrower to expressly request a single point of contact with the loan servicer. The Conroys’ operative complaint did not allege they ever requested a single point of contact, and the Conroys did not state they could amend their cause of action to allege they actually requested one. The trial court properly dismissed the Conroys’ Unfair Competition Law claim because it was merely derivative of other causes of action that were properly dismissed. View "Conroy v. Wells Fargo Bank" on Justia Law

The First Circuit affirmed the district court’s dismissal of Plaintiff’s claims against Kohl’s Department Stores, Inc. alleging that the “comparison prices” on Kohl’s price tags were entirely fictional and selected to mislead consumers about the quality of the products sold by Kohl’s. Plaintiff filed suit alleging that Kohl’s had improperly obtained money from her and other Massachusetts consumers in violation of Massachusetts statutory and common law. Plaintiff requested that a court order Kohl’s to restore this money and enjoin the store from continuing to violate Massachusetts law. The First Circuit (1) affirmed the dismissal of Plaintiff’s claims for damages and injunctive relief and her common law claims for fraud, breach of contract, and unjust enrichment for the reasons stated in Shaulis v. Nordstrom, Inc., No. 15-2354, slip op. at 5-32 (1st Cir. July 26, 2017), also decided today; and (2) affirmed the district court’s denial of Plaintiff’s motion for leave to file a second amended complaint, holding that the district court did not err in denying the motion. View "Mulder v. Kohl's Department Stores, Inc." on Justia Law

The First Circuit affirmed the district court’s motion to dismiss Plaintiff’s complaint against Nordstrom, Inc. alleging that Nordstrom had improperly obtained money from her and other Massachusetts consumers and requesting that a court order Nordstrom to restore this money and enjoin Nordstrom from continuing to violate Massachusetts law. Plaintiff’s claims were based on her purchase of a cardigan sweater for $49.97 at a Nordstrom Rack outlet store in Boston, Massachusetts. The sweater’s price tag listed both the purchase price and a higher “Compare At” price of $218. Plaintiff claimed that the sweater was never sold for $218 but, rather, that Nordstrom uses the “Compare At” price tags to mislead consumers about the quality of its items. On appeal, Plaintiff challenged the dismissal of her Mass. Gen. Laws ch. 93A claim and her common law claims for fraud, breach of contract, and unjust enrichment. The First Circuit affirmed, holding (1) because Plaintiff did not adequately allege that she suffered a legally cognizable injury, her Chapter 93A claims for damages and injunctive relief were both properly dismissed; and (2) the district court did not err in dismissing Plaintiff’s remaining claims. View "Shaulis v. Nordstrom, Inc." 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). Blatt voluntarily dismissed the suit. Oliva sued Blatt for violating the FDCPA 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). The Seventh Circuit initially affirmed. On rehearing, en banc, the Seventh Circuit vacated. The holding in Suesz was required by the 2010 Supreme Court decision in Jerman v. Carlisle, that the FDCPA’s statutory safe harbor for bona fide mistakes does not apply to mistakes of law. Under Suesz and Jerman, the defendant cannot avoid liability for a violation based on its reliance on circuit precedent or any other bona fide mistake of law. View "Oliva v. Blatt, Hasenmiller, Leibsker & Moore, LLC" on Justia Law

Jackson, injured in an accident, taken to University Hospital, where she stated that she had health insurance coverage through United. Jackson received treatment from PRI, which uses MDB for billing services. PRI did not submit charges to United but sent Jackson a letter seeking payment of $1,066 and requesting that Jackson’s attorney sign a letter of protection against any settlement to prevent Jackson’s account from being sent to collections. Jackson did not pay. Her account was submitted to CCC, which sent Jackson a collection letter. Jackson’s attorney negotiated a $852 payment to CCC as final settlement of the charges. PRI or MDB later contacted Jackson, stating that she still owed $3.49. Jackson paid that amount. She brought a class action against CCC, PRI, and MDB for violation of Ohio Rev. Code 1751.60(A), which prohibits directly billing patients who have health insurance when the healthcare provider has a contract with the patient’s insurer to accept that insurance. The complaint also alleged breach of contract, breach of third-party beneficiary contract, violation of the Ohio Consumer Sales Practices Act, violation of the Fair Debt Collection Practices Act, fraud, conversion, unjust enrichment, and punitive damages. The Sixth Circuit reversed dismissal of the claims under section 1751.60 against PRI and MDB, but affirmed as to CCC, which is not subject to the section. View "Jackson v. Professional Radiology, Inc." on Justia Law