Justia Consumer Law Opinion Summaries

P.F. Chang’s restaurant company announced that its computer system had been breached and some consumer credit- and debit–card data had been stolen. Kosner had dined at a P.F. Chang’s and paid with his debit card. Four fraudulent transactions were made with the card he had used; he cancelled it and purchased, for $106, a credit monitoring service to protect against identity theft, including against use of the card’s data to open new accounts in his name. Lewert used a debit card at the same restaurant (thought to be not among those breached) and had no fraudulent transactions, but claims that he spent time and effort monitoring his card statements and his credit report. Lewert and Kosner sought to represent a class of all similarly situated customers, under the Class Action Fairness Act, 28 U.S.C. 1332(d)(2). The district court dismissed for lack of standing, finding they had not suffered the requisite personal injury. The Seventh Circuit reversed. At least some of the injuries alleged qualify as immediate and concrete injuries sufficient to support Article III standing; all class members should be allowed to show that they spent time and resources tracking down possible fraud, changing automatic charges, and replacing cards as a prophylactic measure. View "Lewert v. P.F. Chang's China Bistro, Inc" on Justia Law

Florencio Pacleb filed a class action complaint against Allstate, alleging that he received unsolicited automated calls to his cell phone in violation of the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227. Allstate deposited $20,000 in full settlement of Pacleb’s individual monetary claims in an escrow account “pending entry of a final District Court order or judgment directing the escrow agent to pay the tendered funds to Pacleb, requiring Allstate to stop sending non-emergency telephone calls and short message service messages to Pacleb in the future and dismissing this action as moot.” The court affirmed the district court's order denying Allstate’s motion to dismiss for lack of subject matter jurisdiction. The court concluded that, even if the district court entered judgment affording Pacleb complete relief on his individual claims for damages and injunctive relief, mooting those claims, Pacleb would still be able to seek class certification under Pitts v. Terrible Herbst, Inc., which remains good law under Gomez v. Campbell-Ewald Co. The court also concluded that, even if Pitts were not binding, and Allstate could moot the entire action by mooting Pacleb’s individual claims for damages and injunctive relief, those individual claims are not now moot, and the court will not direct the district court to moot them by entering judgment on them before Pacleb has had a fair opportunity to move for class certification. View "Chen v. Allstate Ins. Co." on Justia Law

This case arose under California's Unclaimed Property Law (UPL). Plaintiff Vanacore and Associates, Inc., dba Vanacore International (Vanacore) was a private investigation firm that specialized in the recovery of unclaimed property. Vanacore entered into a memorandum of understanding (MOU) with defendant Kenneth Rosenfeld. The MOU contemplated that Vanacore would locate and recover shares of stock belonging to Rosenfeld in exchange for a fee. After signing the agreement, Rosenfeld found and recovered the shares himself and refused to pay Vanacore's fee. Vanacore sued for breach of contract, fraud, and unjust enrichment. Rosenfeld demurred on the ground that the MOU violated the Unclaimed Property Law, which precluded certain asset recovery agreements. The trial court sustained the demurrer without leave to amend, finding the MOU illegal and unenforceable. Finding no reversible error in the trial court's judgment, the Court of Appeal affirmed. View "Vanacore and Associates, Inc. v. Rosenfeld" on Justia Law

Acceptance, a debt collector, purportedly acquired consumer debts purportedly owed by plaintiffs. The Fulton firm sent initial collection notices to the plaintiffs or their attorneys, identifying Acceptance as the “assignee” of the original creditors, but stating that the accounts had been “transferred” to Fulton. The letters did not explicitly identify Acceptance as the current creditor. Plaintiffs sued under the Fair Debt Collection Practices Act, 15 U.S.C. 1692, which requires a debt collector to disclose to a consumer “the name of the creditor to whom the debt is owed,” either in its initial communication or in a written notice sent within the next five days. The court granted defendants summary judgment. The court found the letters ambiguous as to the identity of the current creditor, but held that plaintiffs needed to present extrinsic evidence of confusion, and that even with such evidence, the ambiguity would be immaterial to the Act’s objective of providing “information that helps consumers to choose intelligently.” The Seventh Circuit reversed. The district court correctly found that the letters were unclear, but erred in finding that additional evidence of confusion was necessary to establish a violation. Section 1692g(a) requires debt collectors to disclose specific information. If a letter fails to disclose that information clearly, it violates the Act; there is no additional materiality requirement, express or implied. View "Janetos v. Fulton Friedman & Gullace, LLP" on Justia Law

Graiser, an Ohio citizen, saw a “Buy One, Get One Free” eyeglasses advertisement at the Beachwood, location of Visionworks, a Texas eye-care corporation operating in more than 30 states. According to Graiser, a Visionworks salesperson quoted Graiser “a price of $409.93 for eyeglasses, with a second eyeglasses ‘free.’” Alternatively, the salesperson told Graiser that he could purchase a single pair of eyeglasses for $245.95. Graiser filed a purported class action in state court, alleging violation of the Ohio Consumer Sales Practices Act. Visionworks removed the case under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d), claiming that the amount in controversy recently surpassed CAFA’s jurisdictional threshold of $5,000,000. Graiser successfully moved to remand, arguing that removal was untimely under the 30-day period in 28 U.S.C. 1446(b)(3). The Sixth Circuit vacated and remanded, holding that section 1446(b)’s 30-day window for removal under CAFA is triggered when the defendant receives a document from the plaintiff from which it can first be ascertained that the case is removable under CAFA. The presence of CAFA jurisdiction provides defendants with a new window for removability, even if the case was originally removable under a different theory of federal jurisdiction. View "Graiser v. Visionworks of America, Inc." on Justia Law

Plaintiff filed suit against Defendants Barton, Weiss, and CACi, raising claims under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692d-f, alleging misrepresentations along with certain claims for interest and costs. The court concluded that the Rooker-Feldman doctrine does not apply in this case where plaintiff seeks relief from neither a Missouri judgment nor an Illinois garnishment order. Rather, plaintiff alleges statutory violations seeking statutory penalties based on Barton’s actions in the process of obtaining the judgment and order. The court further concluded that, because equitable tolling does not apply, all of plaintiff’s FDCPA claims directed towards conduct that preceded the Illinois proceedings are time barred. Because Barton's use of the Illinois courts did not amount to an action "against the consumer," those actions were not subject to the FDCPA's venue restriction. The court affirmed as to these claims. The court reversed the district court's dismissal of claims that allege independent FDCPA violations in the Illinois proceedings related to the identity of Barton’s client and the amounts of interests and costs asserted; the court declined at the pleading stage of this case to apply state-law preclusion principles to these remaining claims due to the absence of briefing and the parties’ failure to clearly identify the state law applied by the Illinois court; and because federal claims remain, the court reversed the discretionary dismissal of the state law claims and remanded for further proceedings. View "Hageman v. Barton" on Justia Law

Plaintiff filed suit against the Collectors, alleging that the debt collection letter they sent her violated section 1692(g) of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692(g), by failing to notify her of the "in writing" requirement. Plaintiff also alleged that omitting the “in writing” requirement violated section 1692e, which prohibits using “false representation or deceptive means to collect or attempt to collect any debt.” The district court dismissed the complaint with prejudice. The court joined the Third, Fourth, and Seventh Circuits in holding that a debt collection notice sent to a consumer’s attorney is an “indirect” communication with the consumer; the court rejected the notion that section 1692g gives debt collectors discretion to omit the “in writing” requirement or cure improper notice by claiming waiver; the FDCPA already specifies a remedy for violations of section 1692g and the court will not judicially fashion a waiver remedy for violations of section 1692g when the FDCPA identifies civil liability as the remedy for noncompliance; and the communication alleged in this case states a claim for “false, deceptive, or misleading” behavior under section 1692e where neither the “competent lawyer” nor the “least sophisticated consumer” could be said to have notice of the “in writing” requirement after receiving a letter like the one alleged. Accordingly, the court reversed and remanded. View "Bishop v. Ross Earle & Bonan, P.A." on Justia Law

Sgouros purchased a “credit score” package from TransUnion. Armed with the number TransUnion gave him, he went to a car dealership and tried to use it to negotiate a favorable loan. The score he had bought, however, was useless: it was 100 points higher than the score pulled by the dealership. Sgouros filed suit, asserting that TransUnion violated the Fair Credit Reporting Act, 15 U.S.C. 1681g(f)(7)(A); the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/1; and the Missouri Merchandising Practices Act, Mo. Rev. Stat. 407.010, by misleading consumers by failing to inform them that the formula used to calculate their purchased credit scores was materially different from the formula used by lenders. TransUnion moved to compel arbitration, asserting that the website through which Sgouros purchased his product included an agreement to arbitrate. The district court concluded that no such contract had been formed and denied TransUnion’s motion. The Seventh Circuit affirmed after evaluating the website and concluding that TransUnion had not put consumers on notice of the terms of agreement, as required by Illinois law, but actually distracted them from noticing those terms. View "Sgouros v. TransUnion Corp." on Justia Law

Plaintiffs, four Maryland consumers, filed suit against Santander and its agents, alleging that defendants violated the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C.1692-1692p, by engaging in prohibited collection practices when collecting on plaintiffs’ automobile loans. The court affirmed the district court's grant of Santander's motion to dismiss on the ground that the complaint did not allege facts showing that Santander qualified as a “debt collector” subject to the FDCPA. The court concluded that the FDCPA generally does not regulate creditors when they collect debt on their own account and that, on the facts alleged by plaintiffs, Santander became a creditor when it purchased the loans before engaging in the challenged practices. View "Henson v. Santander Consumer USA, Inc." on Justia Law

Plaintiffs filed suit against defendant under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692e, alleging that they received collection notices that were misleading because they stated the “current balance,” but did not disclose that the balance might increase due to interest and fees. The court held that Section 1692e requires debt collectors, when they notify consumers of their account balance, to disclose that the balance may increase due to interest and fees. Therefore, the court vacated the district court's dismissal of this claim and remanded for further proceedings. The court affirmed the district court's dismissal of plaintiffs' other claims in a summary order issued simultaneously with this opinion. View "Avila v. Riexinger & Assoc., LLC" on Justia Law