Justia Consumer Law Opinion Summaries

Plaintiffs, former customers of West Bank, filed a multiple-count proposed consumer class action lawsuit against the Bank challenging one-time nonsufficient funds fees the Bank charged when Plaintiffs used their debit cards to create overdrafts in their checking account. Plaintiffs alleged usury claims and sequencing claims. the Bank filed three motions for summary judgment asking the district court to dismiss all of Plaintiffs’ usury and sequencing claims. The district court denied the Bank’s motions for summary judgment on the usury and sequencing claims but granted summary judgment on the Bank’s motion for summary judgment on Plaintiffs’ usury claim arising under the Iowa Ongoing Criminal Conduct Act. The Bank filed this interlocutory appeal on the district court’s denial of its motions for summary judgment. The Supreme Court affirmed in part and reversed in part, holding that the district court erred in denying the Bank’s motions for summary judgment except as to Plaintiffs’ claim based on a potential breach of the express duty of good faith in the sequencing of postings of bank card transactions. Remanded. View "Legg v. West Bank" on Justia Law

Plaintiff was diagnosed with drug-induced lupus, allegedly a side effect from using Solodyn, a treatment for acne. Plaintiff sued Medicis Pharmaceutical Corporation, which manufactures and distributes Solodyn, alleging that Medicis knowingly represented and omitted material facts in connection with the sale or advertisement of Solodyn in violation of the Consumer Fraud Act (CFA). Plaintiff also alleged that Medicis failed to adequately warn her of the consequences of the long-term use of Solodyn. The superior court granted Medicis’s motion to dismiss. At issue on appeal was the learned intermediary doctrine (LID), under which a manufacturer satisfies its duty to warn end users by giving appropriate warnings to the class of persons who may prescribe or administer the product. The Supreme Court reversed the superior court’s order dismissing Plaintiff’s complaint, holding (1) the LID does not prevent Plaintiff from suing Medicis; (2) Plaintiff alleged sufficient facts to survive Medicis’s motion to dismiss with regard to her products liability claim; and (3) the CFA applies to prescription pharmaceuticals, and therefore, Plaintiff alleged an actionable claim under the CFA. View "Watts v. Medicis Pharmaceutical Corp." on Justia Law

Plaintiff filed suit against Wells Fargo, alleging that his mortgage agreement, providing him with a loan far in excess of his home’s actual value, was an “unconscionable contract” under the West Virginia Consumer Credit and Protection Act, W. Va. Code 46A–1–101 et seq. The court agreed with the district court that the amount of a mortgage loan, by itself, cannot show substantive unconscionability under West Virginia law, and that plaintiff has not otherwise made that showing. The court concluded, however, that the Act allows for claims of “unconscionable inducement” even when the substantive terms of a contract are not themselves unfair. Accordingly, the court remanded so that the district court may consider this issue in the first instance. View "McFarland v. Wells Fargo Bank" on Justia Law

Appellant, a payday loan company, provided loans to the named plaintiffs. The named plaintiffs and other borrowers did not repay their loans, prompting Appellant to file several thousand individual collection actions. Appellant secured thousands of default judgments against the named plaintiffs. It was later discovered that the process server hired by Appellant falsified affidavits of service. The named plaintiffs sued Appellant, alleging that Appellant improperly obtained its default judgments against them and other similarly situated borrowers without their knowledge. Appellant moved to compel arbitration based on the arbitration provisions in its loan agreements. The district court denied Appellant’s motions, holding that Appellant waived its right to arbitrate by bringing collection actions in justice court and obtaining default judgments based on falsified affidavits of service. The Supreme Court affirmed, holding that the district court correctly concluded that Appellant waived its right to an arbitral forum where the named plaintiffs’ claims all concerned the validity of the default judgments Appellant obtained against them in justice court. View "Principal Investments v. Harrison" on Justia Law

The Ticket Law, N.J. Stat. 56:8-35.1, part of New Jersey’s Consumer Fraud Act, says: It shall be an unlawful practice for a person, who has access to tickets to an event prior to the tickets’ release for sale to the general public, to withhold those tickets from sale to the general public in an amount exceeding 5% of all available seating for the event. The Consumer Fraud Act permits private plaintiffs to sue any person who violates the Act and causes them to suffer ascertainable damages. Plaintiffs wanted to attend Super Bowl XLVIII, which was held in New Jersey in 2014. One plaintiff bought two tickets on the resale market, allegedly for much more than face price. They assert that the NFL’s method of selling tickets to Super Bowl XLVIII violated the Ticket Law and resulted in unjust enrichment. The Third Circuit affirmed dismissal. Neither plaintiff has constitutional standing to bring this case. Otherwise, anyone who purchased a Super Bowl ticket on the resale market would have standing to sue in federal court based on nothing more than conjectural assertions of causation and injury. Article III requires more. The court declined to interpret the Ticket Law’s meaning. View "Finkelman v. Nat'l Football League" on Justia Law

In 2013, Plaintiff purchased a new car from Defendant. In 2014, Plaintiff filed the underlying petition for damages, alleging that Defendant violated the Missouri Merchandising Practices Act by failing to pass title for her new vehicle. Thereafter, Defendant asked the trial court to enforce the arbitration agreement between the parties. The trial court overruled the motion to compel arbitration on the ground that the contract between the parties was void under Mo. Rev. Stat. 301.210. The Supreme Court vacated the judgment of the trial court, holding that even though the sale between Plaintiff and Defendant may be void under section 301.210, that question is for the arbitrator to determine, not the trial court. Remanded with instructions for the trial court to grant Defendant’s motion and compel arbitration. View "Ellis v. JF Enters., LLC" on Justia Law

Plaintiff filed suit alleging that HRFC violated the Maryland Credit Grantor Closed End Credit Provisions (CLEC), Md. Code Ann., Com. Law 12-1001 et seq., breached a retail installment sales contract, and violated the Maryland Consumer Debt Collection Act (MCDCA), Md. Code. Ann., Com. Law 14-201 et seq. The district court granted summary judgment to HRFC. The court held that HRFC’s mere failure to disclose an interest rate below CLEC’s statutory maximum is not a distinct violation of section 12-1003(a) for which liability may be imposed; HRFC complied with section 12-1020’s notice requirement and HRFC did not fail to properly cure its error; and the court rejected plaintiff's contention that because the contract incorporates CLEC’s provisions, HRFC is liable for breach of contract for any deviation from CLEC, “regardless of whether HRFC properly cured the failure to comply” with the statute. The court held, however, that a jury could find that HRFC's conduct, at least in the aggregate, could reasonably be expected to abuse or harass plaintiff. Accordingly, the court reversed the district court's order in regard to the MCDCA claim. The court affirmed as to the CLEC and breach of contract claims. View "Askew v. HRFC, LLC" on Justia Law

Plaintiff appealed the district court's judgment in favor of Ocwen and dismissal of plaintiff's complaint alleging various causes of action under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692. At issue is whether a debtor who has received a claim on a debt that has been discharged in a bankruptcy proceeding can sue the claimant in a district court under the FDCPA. The court concluded that the Bankruptcy Code does not broadly repeal the FDCPA for purposes of FDCPA claims based on conduct that would constitute alleged violations of the discharge injunction; none of plaintiff's individual FDCPA claims conflicts with the discharge injunction under the Bankruptcy Code; and, in regard to the claim of piecemeal litigation, the court concluded that the remote possibility of a need for clarification provides no basis for routing all FDCPA claims exclusively into the bankruptcy court. Accordingly, the court reversed and remanded with instructions to reinstate plaintiff's FDCPA claims against Ocwen. View "Garfield v. Ocwen Loan Servicing, LLC" on Justia Law

Three putative class action complaints alleged that Defendants engaged in deceptive marketing and advertising about the health benefits of certain “barefoot” running shoes. The district court preliminary approved a settlement and certified a class for settlement purposes only. Notice was subsequently distributed to the class, and some 154,927 timely claims were filed. Objections were filed by three individuals, none of whom complied with the requirement in the proposed settlement agreement that proof of purchase must be submitted with an objection to establish class membership. The district court rejected the objectors’ claims, approved the proposed settlement, and awarded attorneys’ fees and expenses to class counsel. The First Circuit affirmed, holding (1) there was no misrepresentation in the notices sent to class members; (2) the settlement was fair, reasonable, and adequate; (3) the district court did not abuse its discretion in concluding that injunctive relief was a valuable contribution to the settlement agreement; and (4) there was no abuse of discretion in the district court’s award of attorneys’ fees. View "Bezdek v. Vibram USA, Inc." on Justia Law

Samuel Heckart brought this action against A-1 Self Storage, Inc., Caster Properties, Inc., Caster Family Enterprises, Inc., Caster Group LP, and Deans & Homer (together, Defendants) for violations of the Unfair Competition Law, violations of the Consumers Legal Remedies Act, negligent misrepresentation, and civil conspiracy. Heckart alleged A-1's sale of a Customer Goods Protection Plan (the Protection Plan) in connection with its rental of storage space constituted unlicensed sale of insurance. The form Protection Plan required the tenant to either initial to accept or decline participation in the plan. Heckart declined participation by initialing that option, which provided: "No, I decline participation in the . . . Protection Plan. I am currently covered by an insurance plan that covers my belongings in the storage facility. I understand that I need to provide the policy information in writing to the facility Owner within 30 days or I will automatically be enrolled in the . . . Protection Plan until I do provide such information to the Owner." Heckart "inadvertently" purchased the Protection Plan and was enrolled in it, presumably because he failed to provide proof of insurance within 30 days. In April 2013, Heckart, on behalf of himself and other similarly situated California residents, sued A-1 and Caster Group. The trial court sustained Defendants' demurrer to Heckart's first amended complaint without leave to amend, concluding the Protection Plan was not insurance. Heckart appealed, contending his allegations were sufficient to state the asserted causes of action because the Protection Plan was insurance that must comply with the Insurance Code. The Court of Appeal found his arguments unavailing and affirmed. View "Heckart v. A-1 Self Storage" on Justia Law