Justia Consumer Law Opinion Summaries

This case involved arbitration proceedings stemming from plaintiff's class action suit alleging, among other things, that SouthernLINC's termination fees were unlawful penalties under Georgia law. SouthernLINC, a wireless provider, appealed the district court's denial of its motion to vacate two arbitration awards. Under the standard set forth by the Supreme Court in Oxford Health Plans LLC v. Sutter, the court concluded that the arbitrator did not exceed his powers under section 10(a)(4) of the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq., either in construing the arbitration clause as he did or in certifying a class. Accordingly, the court affirmed the judgment of the district court. View "Southern Communications Serv. v. Thomas" on Justia Law

Plaintiffs in these consolidated appeals brought claims under the Truth in Lending Act (TILA), 15 U.S.C. 1601 et seq., related to their mortgage transactions. The court held that to accomplish rescission within the meaning of section 1635(f), the obligor must file a rescission action in court. Because neither plaintiffs accomplished rescission in this way within three years of their respective transactions, their right to rescind expired and the district court correctly entered summary judgment on these claims. Further, plaintiffs were not entitled, as a matter of law, to money damages for the banks' refusal to rescind, although their claim was cognizable, where the violation - that each set of plaintiffs were given one, rather than two TILA disclosures - was not facially apparent on the loan documents as set forth in section 1641. View "Keiran, et al. v. Home Capital, Inc., et al." on Justia Law

Appellant signed a loan agreement with Bank for a line of credit for his business (Business). Appellant later defaulted on the loan, and Bank brought a collection action against Appellant, his wife, their conjugal partnership, and Business. The FDIC subsequently took over the Bank as receiver and obtained summary judgment in its favor on the collection action. The district court also dismissed Appellants' counterclaim for lack of jurisdiction, finding that Appellants had not timely taken the steps necessary to maintain an action against the FDIC. The First Circuit Court of Appeals affirmed, holding (1) summary judgment was properly granted on the collection action because factual disputes did not remain concerning Bank's role in causing Appellants to breach their loan agreement and whether Appellants should be released from their obligations under that agreement; and (2) the district court correctly dismissed Appellants' counterclaims on jurisdictional grounds, as the Bank had insufficient assets to make any distribution on the claims of general unsecured creditors, including Appellants if they prevailed on their counterclaim, and therefore, the claim was not redressable. View "Fed. Deposit Ins. Corp., as receiver for R-G Premier Bank of P.R. v. Estrada-Rivera" on Justia Law

Plaintiffs filed suit against Wells Fargo under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692-1692p, and the Equal Credit Opportunity Act (ECOA), 15 U.S.C. 1691-1691f. The court affirmed the district court's dismissal of plaintiffs' FDCPA claim because the complaint did not plausibly allege that Wells Fargo was a debt collector under section 1692a(6). The court reversed, however, the district court's dismissal of the ECOA claim where the complaint's allegations that Wells Fargo took an adverse action without complying with ECOA's notice requirements were enough for the ECOA claim to survive a motion to dismiss because the parties agreed that Wells Fargo did not send plaintiffs an adverse action notice. View "Schlegel v. Wells Fargo Bank" on Justia Law

Ferraro suffered serious burns after falling asleep next to the power adapter of her newly purchased laptop computer. She filed a product liability suit, alleging a design defect that allowed the power adapter to overheat, that HP failed to include adequate warnings about the power adapter’s propensity to overheat, and that HP breached an implied warranty of merchantability. The district court granted HP summary judgment, reasoning that Ferraro would be unable to show that the adapter was “unreasonably dangerous,” as required for her design defect claim. The Seventh Circuit affirmed. Illinois law provides two alternative methods of establishing unreasonable danger: the “consumer-expectations test” and the “risk-utility test.” Ferraro appealed with respect to the consumer expectations test, but, under Illinois law, the risk-utility test “trumps” in design defect cases if the two methods of establishing unreasonable dangerousness have conflicting results. The district court’s finding that Ferraro could not succeed under the risk-utility test furnished an independent, unchallenged ground for its decision. View "Ferraro v. Best Buy Stores, L.P." on Justia Law

Plaintiffs appealed the district court's dismissal of their first amended complaint and the district court's denial of leave to further amend their complaint. Plaintiffs claimed that defendants improperly initiated non-judicial foreclosure proceedings after plaintiffs failed to comply with the mortgage obligations financing their residence. Because the provisions of the deed of trust foreclosed the pleading of a plausible "show me the note" claim by plaintiffs, the district court appropriately dismissed this claim; the district court properly dismissed plaintiffs' claims premised on the unauthorized appointment of a successor trustee and/or the lack of proof of ownership of the note where these claims lacked legal and factual plausibility; because Arizona law countenances the trustee sale as conducted, plaintiffs failed to allege any plausible claims premised on the PEB Report or the UCC; plaintiffs' constitutional challenges of A.R.S. 33-811(b) were rejected by the court; plaintiffs' fraud and misrepresentation claims were barred by A.R.S. 12-543(3); and denial of leave to amend was within the district court's discretion. Accordingly, the court affirmed the judgment. View "Zadrozny, et al. v. Bank of New York Mellon, et al." on Justia Law

Plaintiff filed suit against Wells Fargo, alleging that Wells Fargo violated Minn. Stat. 580.032, subd. 3 by failing to record a notice of pendency of foreclosure before publishing the foreclosure notice. The court affirmed the district court's grant of Wells Fargo's motion to dismiss, concluding that the statute did not provide plaintiff with relief in this case because there was no dispute that Wells Fargo properly served plaintiff with notice in compliance with Minn. Stat. 580.03 and, since she received personal service of the foreclosure notice, she could not have been among those for whose benefit the separate notice requirement of Minn. Stat. 580.032, subd. 3 was enacted. View "Badrawi v. Wells Fargo Home Mortgage" on Justia Law

Plaintiff sued Midland, a debt collector, for damages after Midland called him between 22 and 28 times over the course of 2011 when none of the calls were intended for plaintiff. On appeal, plaintiff contended that neither of two putative offers of judgment extended by Midland could have rendered his action moot because neither offer complied with Federal Rule of Civil Procedure 68. The court held that an offer need not comply with Rule 68 in order to render a case moot under Article III. Consequently, the court agreed with the district court that plaintiff's refusal to settle the case in return for Midland's offer, notwithstanding plaintiff's acknowledgement that he could win no more, was sufficient ground to dismiss the case for lack of subject matter jurisdiction. View "Doyle v. Midland Credit Management, Inc." on Justia Law

Plaintiffs filed three separate class action suits alleging that defendants violated Missouri law and conspired with unknown third parties to deceive customers into throwing away medications after their expiration dates, knowing that the medications were safe and effective beyond the expiration date. Defendants appealed the district court's remand order holding that defendants failed to establish the amount in controversy requirement under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d)(2). The court concluded that each defendant's affidavit detailing the total sales of their respective medications in Missouri met the amount in controversy requirement; even if it was highly improbable that plaintiffs would recover the amounts defendants have put into controversy, this did not meet the legally impossible standard; defendants were not required to provide a formula or methodology for calculating the potential damages more accurately, as the district court held; and defendants' affidavits were not inadmissible hearsay. Therefore, the court reversed the district court's finding that it lacked subject matter jurisdiction and remanded for further proceedings. View "Raskas, et al. v. Johnson & Johnson, et al." on Justia Law

Using FOIA requests directed to the South Carolina DMV, attorneys obtained names and addresses, then sent letters to more than 34,000 individuals, seeking clients for a lawsuit against car dealerships for violation of a state law. The letters were headed “ADVERTISING MATERIAL,” explained the lawsuit, and asked recipients to return an enclosed card to participate in the case. Recipients sued the attorneys, alleging violation of the Driver’s Privacy Protection Act of 1994 (DPPA), 18 U.S.C. 2721(b)(4), by obtaining, disclosing, and using personal information from motor vehicle records for bulk solicitation without express consent. The district court dismissed, based on a DPPA exception permitting disclosure of personal information "for use in connection with any civil, criminal, administrative, or arbitral proceeding," including "investigation in anticipation of litigation." The Fourth Circuit affirmed. The Supreme Court vacated and remanded. An attorney’s solicitation of clients is not a permissible purpose under the (b)(4) litigation exception. DPPA’s purpose of protecting privacy in motor vehicle records would be substantially undermined by application of the (b)(4) exception to the general ban on disclosure of personal information and ban on release of highly restricted personal information in cases there is any connection between protected information and a potential legal dispute. The Court noted examples of permissible litigation uses: service of process, investigation in anticipation of litigation, and execution or enforcement of judgments and orders. All involve an attorney’s conduct as an officer of the court, not a commercial actor, seeking a business transaction. A contrary reading of (b)(4) could affect interpretation of the (b)(6) exception, which allows an insurer and certain others to obtain DMV information for use in connection with underwriting, and the (b)(10) exception, which permits disclosure and use of personal information in connection with operation of private tollroads. View "Maracich v. Spears" on Justia Law