Justia Consumer Law Opinion Summaries

The FTC sued Randall Leshin and his co-appellants based on deceptive marketing practices and other violations of the Federal Trade Commission Act, 15 U.S.C. 41 et seq., committed by Leshin's debt-consolidation business. At issue on appeal was whether a district court could convert the unpaid remainder of an equitable disgorgement remedy, stemming from a compensatory civil contempt sanction, into the legal remedy of a money judgment after the contemnor has disgorged as much money as he currently has the ability to pay. The court concluded that the district court acted within the bounds of its broad discretion in this case and affirmed the judgment. View "Federal Trade Commission v. Leshin, et al." on Justia Law

Plaintiffs brought suit against Forman Holt, a debt collector within the meaning of 15 U.S.C. 1692a(6), alleging a violation of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692g. Plaintiffs alleged that Forman Holt's collection notice violated the FDCPA by stating that plaintiffs could only dispute the validity of a debt in writing. The district court granted Forman Holt's motion to dismiss, concluding that plaintiffs had failed to state a claim. The court vacated and remanded, concluding that section 1692g(a)(3) did not impose a writing requirement that required the consumer debtor to notify the debt collector in writing in order to dispute the validity of the debt. View "Hooks v. Forman, Holt, Eliades & Ravin, LLC" on Justia Law

Plaintiffs sued U.S. Bank after the Bank enforced its rights under a revolving credit agreement on which plaintiffs failed to make timely payment. The district court granted summary judgment for the Bank, ruling that plaintiffs, by signing forbearance agreements, released all claims against the Bank, and rejected the contention that these agreements were void because of duress caused by an alleged forgery. The alleged forgery was immaterial to the claims because plaintiffs failed to pay the loan by the maturity date, and the Bank was entitled to enforce its rights under the revolving credit agreement. The court agreed with the district court that the alleged forgery was immaterial and affirmed the judgment. View "Meyer, et al v. U.S. Bank National Assoc." on Justia Law

In 2009, Guidotti began attempting to settle approximately $19,550 in unsecured consumer debt without declaring bankruptcy. She entered into contracts with several “credit counseling agencies.” Dissatisfied with the results, Guidotti brought a putative class action against the companies, alleging that they conspired to provide unlicensed debt adjustment services in violation of the New Jersey Debt Adjustment and Credit Counseling Act, the New Jersey RICO statute, the New Jersey Consumer Fraud Act, and various common law principles. With two of the companies, RMBT and Global, Guidotti opened a special bank account into which she automatically deposited a monthly amount. Those funds were then supposedly to be used to pay the various defendants for their debt negotiation services, with the remaining funds to be used to pay a negotiated settlement. The district court granted a motion to compel arbitration as to most of the defendants, but denied the motion as to RMBT and Global, finding that there had been no meeting of the minds on an agreement to arbitrate. The Third Circuit vacated, finding the record insufficient to prove that there was no genuine dispute of material fact as to whether the two companies and Guidotti agreed to arbitrate. View "Guidotti v. Legal Helpers Debt Resolution, LLC" on Justia Law

In an attempt to avert the foreclosure of her home, Plaintiff sought to modify the terms of her mortgage pursuant to the Home Affordable Modification Program (HAMP), a federal initiative that incentivizes lenders and loan servicers to offer loan modifications to eligible homeowners. When Plaintiff's efforts did not result in a permanent loan modification, she sued Wells Fargo Bank and American Home Mortgage Servicing, alleging that their conduct during her attempts to modify her mortgage violated Massachusetts law. The district court dismissed Plaintiff's complaint for failure to state a claim. The First Circuit Court of Appeal (1) affirmed the district court's judgment as to the dismissal of Plaintiff's claims of breach of contract, breach of the implied covenant of good faith and fair dealing, and intentional and negligent infliction of emotional distress; and (2) vacated the dismissal of Plaintiff's other breach of contract claim, Plaintiff's unfair debt collection practices claim under Mass. Gen. Laws ch. 93A, and her derivative claim for equitable relief. Remanded. View "Young v. Wells Fargo Bank, N.A." on Justia Law

Plaintiff appealed the district court's grant of summary judgment in favor of defendant in this case arising under the Telephone Consumer Protection Act of 1991 (TCPA), Pub. L. No. 102-243, 105 Stat. 2394. Plaintiff's claims were based upon the receipt of one fax advertisement from defendant, which plaintiff's agent undisputedly consented to receive. The one fax plaintiff received did not contain opt-out language that he argued was mandated by federal regulation. According to the FCC, the contested opt-out language was required, even on faxes sent after obtaining a potential recipient's consent. The court reversed because the Administrative Orders Review Act (Hobbs Act), 28 U.S.C. 2342 et seq., precluded the court from entertaining challenges to the regulation other than on appeals arising from agency proceedings. Without addressing such challenges, the court could not reject the FCC's plain-language interpretation of its own unambiguous regulation. View "Nack v. Walburg" on Justia Law

Plaintiff sued Kohl's Department Store claiming that he bought merchandise from Kohl's that he would not have purchased had he not been misled by advertisements stating that the merchandise was marked down from a fictitious "original" or "regular" price. At issue on appeal was whether plaintiff alleged that he "lost money or property" and, therefore, had statutory standing under California law to sue Kohl's to enforce California's prohibition on this deceptive marketing practice. In Kwikset Corp. v. Superior Court, the California Supreme Court held that all a consumer needed to allege to establish standing to bring an Unfair Competition Law (UCL), Cal. Bus. & Prof. Code 17200, et seq., or Fair Advertising Law (FAL), Cal. Bus. & Prof. Code 17500, et seq., claim was that (1) the defendant made a false representation about a product, (2) the consumer purchased the product in reliance on the misrepresentation, and (3) he would not have purchased the product otherwise. The court rejected defendant's argument that Kwikset was distinguishable because it involved a different type of unlawful misrepresentation than the one at issue here. Therefore, the court reversed the district court's dismissal of plaintiff's UCL and FAL claims. For nearly identical reasons, the court reversed the district court's dismissal of plaintiff's Consumer Legal Remedies Act (CLRA), Cal. Civ. Code 1750, et seq., claims. The court also denied defendant's motion to certify both on the merits and because of the circumstances attendant to its filing. View "Hinojos v. Kohl's Corp., et al." on Justia Law

After plaintiffs' house was sold at a non-judicial foreclosure sale, they sued the lender, the holder of the Deed of Trust at the time of the sale, and the successor trustee. The district court granted defendants' motion to dismiss. The court affirmed, concluding that plaintiffs lacked standing to challenge the Fannie Mae designation; the foreclosure sale's procedures complied with Missouri law; the district court properly ruled that plaintiffs' challenged to activities after the foreclosure sale lacked standing; the district court did not err in dismissing plaintiffs' breach-of-fiduciary-duty claim; and the district court did not err in deciding that plaintiffs had failed to plead facts that proved a duty to investigate the transaction on the part of the fiduciary trustee. View "Hallquist, et al v. United Home Loan, et al" on Justia Law

Objectors appealed the district court's orders granting final approval to a class action settlement between HP and a nationwide class of consumers who purchased certain HP inkjet printers between certain dates. Under section 1712 of the Class Action Fairness Act, 28 U.S.C. 1712(a)-(c), a district court could not award attorneys' fees to class counsel that were "attributable to" an award of coupons without first considering the redemption value of the coupons. A district court could, however, award lodestar fees to compensate class counsel for any non-coupon relief they obtained, such as injunctive relief. Because the attorneys' fees award in this case violated section 1712, the court reversed and remanded to the district court for further proceedings. View "In re: HP Inkjet Printer Litigation" on Justia Law

After a bench trial, the federal district court found that Appellant Maggie Chapman violated the "assisting and facilitating" provision of the Telemarketing Sales Rule, 16 C.F.R. 310.3(b). A consumer protection action was brought by the Federal Trade Commission and four states against several individual and corporate defendants who marketed and sold to consumers grant-related goods and services with false representations that the consumers were guaranteed or likely to receive grants. After the claims against the other defendants were settled or adjudicated by entry of summary judgment, the district court held a bench trial on the remaining claim against Ms. Chapman. Following the trial, the court found that Ms. Chapman violated the Telemarketing Sales Rule by providing substantial assistance to telemarketing defendants while knowing or consciously avoiding knowing of their deceptive telemarketing practices. The court accordingly ordered a permanent injunction and $1,682,950 in monetary damages against Ms. Chapman. The court also denied Ms. Chapman's post-judgment motion to alter or amend the judgment or, alternatively, for remittitur. Ms. Chapman appealed both the finding she violated the Telemarketing Sales Rule and the denial of her post-judgment motion. Not persuaded that the district court's underlying factual findings were clearly erroneous, and concluding that the district court did not abuse its discretion in denying Ms. Chapman's post-judgment motion, the Tenth Circuit affirmed the lower court's decision. View "Fed. Trade Comm'n v. Chapman" on Justia Law