Justia Consumer Law Opinion Summaries

IntelliGender sold and advertised the IntelliGender Prediction Test as an accurate predictor of a fetus's gender using the mother's urine sample. The district court approved a Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d), settlement between a nationwide certified class of purchasers of the Test and IntelliGender. The State subsequently filed an enforcement action against IntelliGender under the State's Unfair Competition and False Advertising Laws, largely based on the same claims as the class action. The court concluded that the district court correctly denied IntelliGender's motion to enjoin the State's enforcement action in its entirety where IntelliGender had not met its burden of showing that the CAFA class action settlement could bind the State in its sovereign capacity, where it asserted both public and private interests. The court agreed that a CAFA class action settlement, though approved by the district court, does not act as res judicata against the State in its sovereign capacity, even though many of the same claims are included in both actions. Because the State action is brought on behalf of the people, it implicates the public's interests as well as private interests, and therefore the remedial provisions sweep much more broadly. The court concluded, however, that the State is precluded from seeking the same relief sought in the CAFA class action where IntelliGender provided notice to the appropriate parties of the class action and the State chose not to participate. Therefore, the district court erred in denying IntelliGender's motion to enjoin the State's claims for restitution. Accordingly, the court affirmed in part and reversed in part. View "State of California v. IntelliGender" on Justia Law

Plaintiff filed a class action alleging that the Bank violated the Electronic Funds Transfer Act (EFTA), 15 U.S.C. 1963 et seq., by failing to post an external notice of fees on its ATMs. While the suit was pending but before class certification, Congress amended the EFTA to eliminate the external notice requirement. The district court dismissed plaintiff's claim and denied class certification. The court concluded that plaintiff has standing to bring her claim where Congress's determination that consumers were entitled to the fee information they need to decline a transaction before investing the time needed to initiate it protects a substantive, if small, right, and its deprivation is an injury-in-fact that allows plaintiff to pursue her claim; the Bank's attempt to "pick off" plaintiff's claim before the court could decide the issue of class certification fits squarely within the "relation back" doctrine, which saves her claim from mootness at this stage; the EFTA amendment eliminating the "two notice" provision does not apply retroactively to plaintiff's claim; and the EFTA amendment poses no more a barrier for putative class members than it does for plaintiff, for claims alleging violations before the amendment was enacted. Accordingly, the court vacated the district court's denial of class certification and remanded for further considerations. View "Mabary v. Home Town Bank, N.A." on Justia Law

In 2006, several borrowers sued their lender, CashCall, Inc., alleging CashCall monitored their telephone conversations without their knowledge or consent. Over CashCall's objections, the trial court certified a class on one of the claims, an alleged violation of Penal Code section 632, which imposes liability on a "person" who intentionally "eavesdrops upon or records [a] confidential communication" and engages in this conduct "without the consent of all parties." After class certification, CashCall successfully moved for summary adjudication on the section 632 claim. The trial court found as a matter of law a corporation does not violate the statute when one of its supervisory employees secretly monitors a conversation between a customer and another corporate employee, reasoning that two employees are a single "person" within the meaning of the statute. The Court of Appeal reversed, holding that the statute applies even if the unannounced listener is employed by the same corporate entity as the known recipient of the conversation, concluding the trial court's statutory interpretation was inconsistent with section 632's language and purpose. The Court also rejected CashCall's alternative argument that summary adjudication was proper because the undisputed facts established the telephone conversations were not "confidential communication[s]." On remand, CashCall moved to decertify the class on grounds that the issue whether any particular class member could satisfy a reasonable-expectation test (as the Court discussed in its earlier opinion) required an assessment of numerous individual factors (including those identified in the earlier opinion) and these individual issues predominate over any remaining common issues, making a continued class action unmanageable. Plaintiffs opposed the motion, arguing CashCall did not meet its burden to establish changed circumstances necessary for class decertification and, alternatively, common issues continued to predominate in the case. The court granted the decertification motion. Plaintiffs appealed the decertification, but finding no error in that decision, the Court of Appeal affirmed. View "Kight v. CashCall" on Justia Law

Plaintiffs hired Defendants, an automotive business and its owner, to repair and restore a 1960 Ford Thunderbird. After disputes arose between the parties, Plaintiffs filed this action in the circuit court alleging breach of contract, violation of the Virginia Consumer Protection Act (VCPA), fraud and detinue. Defendants moved to strike Plaintiffs’ evidence as to all counts. The trial court granted the motion as to the fraud and VCPA counts. After a trial on the breach of contract count, the jury returned a verdict for Defendants. The Supreme Court affirmed, holding that the circuit court did not err in (1) striking the evidence after commenting that two witnesses were “believable” and “credible,” as the comments did not usurp the function of the jury; and (2) striking the evidence on the VCPA claim because the evidence was insufficient to go to the jury. View "Owens v. DRS Auto. FantomWorks, Inc." on Justia Law

Plaintiffs, twelve residential and business customers of Defendant Fitchburg Gas and Electric Light Company who lost power during a major ice storm, filed suit on behalf of themselves and those similarly situated, asserting claims of gross negligence and violation of Mass. Gen. Laws ch. 93A. Plaintiffs moved to certify a class, and the parties filed cross-motions for partial summary judgment on Plaintiffs’ chapter 93A claims. In their motion for partial summary judgment, Plaintiffs sought issue preclusive effect of findings made by the Department of Public Utilities (DPU) in two previous administrative adjudications related to Defendant’s conduct during the storm. The superior court judge (1) denied Plaintiffs’ motion for class certification; and (2) primarily denied the motions for summary judgment after applying offensive issue preclusion to factual findings made by the DPU. The Supreme Judicial Court affirmed, holding that the judge did not abuse his discretion in declining to certify a class and in applying issue preclusion to facts found after evidentiary hearings at the DPU. View "Bellermann v. Fitchburg Gas & Elec. Light Co." on Justia Law

In 2004, the plaintiffs’ Rockvale, Tennessee home burned down. They replaced it with a 2180-square-foot, “triple-wide” manufactured home purchased from the defendant for $160,230. Defendant was responsible for “normal delivery and installation” on the plaintiffs’ land and warranted that, “[f]or new homes, installation at the initial homesite will be completed in accordance with applicable governmental requirements.” Defendant delivered and installed the home in March 2005, but only one member of the installation crew was identified. He was not licensed to install manufactured homes as required by T.C. 68-126-404(a). Plaintiffs immediately began noticing defects that suggested the home was not level when installed and notified the defendant before they closed the purchase. Defendant assured plaintiffs that it would repair and level the home. After several years of inspections and repair efforts, defendant never levelled or repaired the home to the plaintiffs’ satisfaction. Plaintiffs sued, claiming breach of contract and federal breach of warranty under15 U.S.C.A. 2304, the Magnuson-Moss Warranty Act, “and/or other applicable law.” The district court held that an arbitration clause was invalid and awarded $39,238.29. The Sixth Circuit remanded, concluding that federal jurisdiction did not exist because the home is not a “consumer product” under the Magnuson-Moss Act. View "Bennett v. CMH Homes, Inc." on Justia Law

Plaintiff filed suit against Guthy for violation of Business and Professions Code section 17529.5, alleging, among other things, that Guthy sent them unsolicited commercial email advertisements purporting to be from "Proactive Special Offer," "Wen Hair Care," "Proactive Special Bonus Deal," "Wen Healthy Hair," "Wen by Chaz Dean," "Proactive Bonus Deal," "Proactive Bonus Gift," and "Proactive: Special Offer," which are not names or registered fictitious business names of existing entities, and are not traceable to Guthy via a WHOIS database. The court held that a header line in a commercial email advertisement does not misrepresent the identity of the sender merely because it does not identify the official name of the entity which sent the email, or merely because it does not identify the official name of the entity which sent the email, or merely because it does not identify an entity whose domain name is traceable from an online database, provided the sender's identity is readily ascertainable from the body of the email, as was the case here; the body of the emails made clear that free shipping or free gifts were contingent upon a purchase; a reasonable sender would not have reason to believe that commercial missives like these were "likely to deceive a recipient, acting reasonably under the circumstances, about a material fact regarding the contents or subject matter of the message." Accordingly, the court concluded no cause of action was stated for violation of section 17529.5, subdivision (a)(2) or (a)(3) and affirmed the judgment of dismissal. View "Rosolowski v. Guthy-Renker" on Justia Law

A jury found in Bui’s favor on an intentional misrepresentation claim and awarded him $150,000 against Hi-Tech Dental and $50,000 against Hi-Tech’s owner and dental assistant, Nguyen. About three weeks later, before judgment was entered, Bui obtained a permanent injunction requiring Nguyen to identify herself as a dental assistant, not a dentist, in all Hi-Tech advertising, and to refrain from wearing a white dental lab coat. Bui made a post-judgment motion for more than $500,000 in attorney fees pursuant to Code of Civil Procedure 1021.5, arguing that he acted in the role of a private attorney general in obtaining injunctive relief that was beneficial to a large group of potential dental patients. The court awarded $126,974.13. The court of appeal reversed. Bui failed to establish that private enforcement was necessary to protect the public from false advertising by Nguyen; necessity of private enforcement is one of the required elements under section 1021.5. View "Bui v. Nguyen" on Justia Law

After Stratton stopped making payments on her credit card, GE “charged off” Stratton’s $2,630.95 debt, as uncollectible. GE stopped charging Stratton interest. By charging off the debt and ceasing to charge interest GE could take a bad-debt tax deduction, I.R.C. 166(a)(2), and avoid the cost of sending Stratton statements. A year later, GE assigned Stratton’s charged-off debt to PRA, a “debt buyer.” Two years later, PRA filed suit in state court, alleging that Stratton owed interest during the 10 months after GE charged off her debt, before GE sold that debt, and that Stratton owed 8% interest rather than the 21.99% rate established in her contract with GE. The 8% rate is the default rate under Kentucky’s usury statute, KRS 360.010. Stratton filed a putative class action, alleging that PRA’s attempt to collect 8% interest for the 10-month period violated the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692, in that the 8% interest was not “expressly authorized by the agreement creating the debt or permitted by law,” that PRA had falsely represented the “character” of Stratton’s debt and the “amount” owed, and that PRA’s suit was a “threat” to take “action that cannot legally be taken.” The district court dismissed. The Sixth Circuit reversed. Under Kentucky law a party has no right to statutory interest if it has waived the right to collect contractual interest; any attempt to collect statutory interest when it is “not permitted by law” violates the FDCPA. View "Stratton v. Portfolio Recovery Assocs., LLC" on Justia Law

This was a dispute between two collections agencies. Medical Recovery Services, LLC (MRS) and Bonneville Billing and Collections, Inc. (BBC) both had outstanding accounts relating to the same debtor, Stacie Christ. In 2008, MRS obtained a judgment against Christ for $1,868. MRS then obtained an order for continuing garnishment of Christ's wages at her place of employment, Western States Equipment Company (WSEC), until the judgment, plus interest, was satisfied. WSEC intended to make the first payment on the continuing garnishment, but a WSEC's payroll department employee inadvertently selected "BBC" instead of "BCS," (for Bonneville County Sheriff), on a computer dropdown menu, and sent the first payment of $331.00 to BBC. WSEC repeated the same mistake on two subsequent occasions and sent checks for $394.83 and $357.38 to BBC instead of the Bonneville County Sheriff. BBC had been assigned two accounts involving Christ as the debtor. The first account was assigned on May 7, 2007, in the amount of $325.50. BBC filed a complaint in connection with this account on May 8, 2008, but did not obtain a judgment. The second account was assigned on April 24, 2008, in the amount of $966.86, and BBC had not yet initiated legal efforts to collect on this account. Due to WSEC's payroll mistake, BBC received three checks from WSEC: $331.00 on July 22, 2008; $394.83 on July 28, 2008; and $357.38 on August 12, 2008. In total, WSEC mistakenly sent BBC $1,083.21, which BBC applied to Christ's outstanding accounts. MRS received a letter from the Bonneville County Sheriff alerting MRS to WSEC's errors. The letter indicated that WSEC had also notified BBC of the error but that BBC refused to return the money. After learning of WSEC's payroll mistake, MRS contacted WSEC and instructed WSEC to discontinue the garnishment. MRS sent BBC a demand letter asking for a return of the $1,083.21. BBC acknowledged receiving the checks and stated that it intended to keep the funds since Christ owed on accounts held by BBC. BBC further indicated that, at the time the checks were received, it believed that the funds resulted from wage assignments that Christ had voluntarily initiated to pay her debts. MRS then sued BBC alleging conversion, unjust enrichment, and requesting a constructive trust over the disputed funds in the amount of $1,083.21. Both parties moved for summary judgment. The magistrate court denied MRS' motion, granted BBC's motion, and awarded BBC attorney fees and costs in the amount of $10,658. On May 3, 2011, MRS appealed to the district court. The district court reversed the magistrate court's judgment and: (1) granted MRS summary judgment on the issues of unjust enrichment and conversion; (2) imposed a constructive trust in favor of MRS over the disputed $1,083.21; (3) vacated the magistrate court's order granting BBC attorney fees and costs; (4) remanded the matter to determine a pre-appeal attorney fee award for MRS; and (5) granted MRS attorney fees on appeal. BBC appealed. The Court of Appeals reversed the district court and reinstated the magistrate court's award of attorney fees. Upon review, the Supreme Court concluded the district court erred in finding that BBC was unjustly enriched by MRS, erred in finding that BBC converted MRS' property, and erred in imposing a constructive trust. Accordingly, the district court's memorandum decision and order was reversed. The case was remanded to the district court with instructions to reinstate the magistrate court's award of attorney fees in favor of BBC and to determine an appropriate award in favor of BBC for attorney fees incurred in proceedings before the district court on intermediate appeal. View "MRS v. Bonneville Billing and Collections" on Justia Law