Justia Consumer Law Opinion Summaries

Appellee First Community Bank loaned $175,000 to Catherine Warbington and two Warbington family trusts, listing the property in the trusts as security. After Catherine died, the bank later filed a foreclosure complaint, asserting that payments were not being made on the loan and naming as defendants the unknown heirs of Catherine, the trusts, the trustee of the trusts, and others. Later, a foreclosure judgment was entered finding that the parties before the court had consented to the judgment and were indebted to the bank for the principal amount. The heirs and trusts then filed a motion to vacate the foreclosure, asserting (1) that the judgment was void by operation of law because Bert Warbington had not been personally served as trustee, and (2) Bert was not named individually in the complaint though he was a known heir and as such Ark. R. Civ. P 4 and due process required the bank name him as a party. The circuit court denied the motion. On appeal, the Supreme Court found (1) the circuit court did not clearly err in finding from the evidence that there was personal service and (2) that the circuit court did not err in finding that Bert was an unknown heir. Affirmed.

These consolidated lawsuits involved state tort law claims based on certain drug manufacturers' alleged failure to provide adequate warning labels for the generic drug metoclopramide. State tort law required a manufacturer that was, or should be, aware of its drug's danger to label it in a way that rendered it reasonably safe. On the other hand, federal drug regulations, as interpreted by the FDA, prevented the manufacturers from independently changing their generic drug safety labels. At issue was whether such federal drug regulations applicable to generic drug manufacturers directly conflicted with, and thus preempted, the state law claims. The Court concluded that the federal drug regulations preempted the state law claims because, if manufacturers had independently changed their labels to satisfy their state law duty to attach a safer label to their generic metoclopramide, they would have violated the federal requirement that generic drug labels be the same as the corresponding brand-name drug labels. Thus, it was impossible for the manufacturers to comply with federal and state law. Even if the manufacturers had fulfilled their federal duty to ask for FDA help in strengthening the corresponding brand-name labels, assuming such a duty existed, they would not have satisfied their state tort law duty. State law demanded a safer label, it did not require communication with the FDA about the possibility of a safer label. Therefore, the Court held that when a party could not satisfy its state duties without the Federal Government's special permission and assistance, which was dependent on the exercise of judgment by a federal agency, that party could not independently satisfy those state duties for preemption purposes. The Court also noted that Congress and the FDA retained authority to change the law and regulations if they so desired. Accordingly, the case was reversed and remanded for further proceedings.

Vermont's Prescription Confidentiality Law, Vt. Stat. Ann., Tit. 18, 4631(d), restricted the sale, disclosure, and use of pharmacy records that revealed the prescribing practices of individual doctors. Respondents, Vermont data miners and an association of brand-name drug manufacturers, sought declaratory and injunctive relief against state officials, contending that section 4631(d) violated their rights under the Free Speech Clause of the First Amendment. At issue was whether section 4631(d) must be tested by heightened judicial scrutiny and, if so, whether Vermont could justify the law. The Court held that the Vermont Statute, which imposed content-based and speaker-based burdens on protected expression, was subject to heightened judicial scrutiny. The Court also held that Vermont's justifications for section 4631(d) did not withstand such heightened scrutiny and therefore, affirmed the Second Circuit's judgment that section 4631(d) unconstitutionally burdened the speech of pharmaceutical marketers and data miners without adequate justification.

After receiving two letters from the law firm, the plaintiff filed suit claiming that the firm violated the Fair Debt Collection Practices Act, 15 U.S.C. 1692e, by misleading him to believe that an attorney was involved in collecting his debt, and that the attorney could, and would, take legal action against him. The district court entered summary judgment in favor of plaintiff. The Third Circuit affirmed, finding that the "least sophisticated debtor" could conclude that an attorney, acting as an attorney, had reviewed his account and determined that he was a candidate for legal action. Disclaimers on the backs of the letters did not clarify that the firm was acting solely as a debt collector.

Elgene Phillips was driving his truck when the truck hydroplaned, ran off the road, and rolled over. Phillips died as a result of the accident. As administratrix of the decedent's estate, petitioner Shelia Haynes filed a wrongful death action, alleging that the seatbelt in the decedent's trunk was defective. Chrysler, the manufacturer of the decedent's truck, and Autoliv, the manufacturer of the seatbelt, were named as defendants. The parties settled for $150,000, but the agreement did not contain an apportionment between the two defendants regarding who was responsible for that amount. After Chrysler declared bankruptcy, petitioner filed a motion to sever claims against Chrysler and a motion to compel Autoliv to pay the entire amount of the settlement. The circuit court denied petitioner's motions, and as a result petitioner received only $65,000 in settlement proceeds. The Supreme Court reversed, holding that (1) the terms of the contract were unambiguous, and Autolive was bound by the underlying agreement; and (2) by cashing Autolive's check for $65,000, the petitioner and Autolive did not reach an accord and satisfaction under the facts of the case.

Plaintiff Kathy Lamarque executed a mortgage with defendant Centreville Savings Bank. After defaulting on another loan for a second mortgage on the same property, defendant disclosed the balance of plaintiff's mortgage to the purchaser of plaintiff's property at a foreclosure sale. Plaintiff filed a complaint against defendant for negligence and a violation of plaintiff's privacy rights. At trial, defendant moved for a judgment on partial findings, which the trial court granted. Plaintiff appealed, arguing that her right to privacy was violated by defendant and that the Gramm-Leach-Bliley Act and defendant's privacy policy created a legal duty to protect private information from disclosure. The Supreme Court affirmed, holding that under the facts of the case, plaintiff's privacy rights were not violated and defendant did not breach its duty to plaintiff.

In this case, the court addressed the remedies available to a patient when a debt collector, acting on behalf of a medical professional, was asserted to have illegally disclosed confidential patient information to various consumer reporting agencies in the course of a dispute over an alleged medical debt. At issue was whether all state law claims arising from the furnishing of information to consumer reporting agencies were preempted by the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. 1681t(b)(1)(F). The court concluded that, because of the dual state and federal responses to the protection of an individual's privacy and accuracy interests, when the interests overlap, as in this case, the question of what remedies were available was a federalism problem. The court subsequently held that Congress did not intend for the state remedies to be preempted. Accordingly, the court reversed and remanded for further proceedings.

This lawsuit arose from the dispute between the parties about how much appellant was obligated to pay appellee for auto-glass goods and services rendered on behalf of appellant's insureds. Appellants appealed from the district court's orders dismissing its counterclaim that appellee violated Minnesota's anti-incentive statute, Minn. Stat. 325F.783, granting summary judgment in favor of appellee on appellant's counterclaim for breach of contract, and denying appellant's motion to vacate the arbitration award. The court held that, given the plain language of the statute and the ordinary meaning of the terms of rebate and credit, appellee's practice did not violate the anti-incentive statute. The court also held that even if the blast faxes at issue constituted offers to enter into unilateral contracts, appellee rejected the offers when its actions failed to conform to the terms of the offer. The court further held that the arbitration award did not require reversal or new proceedings because the award was based on the finding that appellant failed to pay the competitive price standard set forth in the applicable endorsement and Minnesota law.

Citizens Bank filed a complaint against Howard Issler, seeking to recover funds allegedly owned to the bank in connection with a line of credit that the bank had extended to him. After judgment was entered against Howard and execution was returned unsatisfied, Citizens filed for a writ of attachment. Kymberly Issler, who had a joint account with Howard, then intervened in the civil action, objecting to the attachment and to the release of any funds to Citizens. A hearing officer granted the attachment. Citizens then filed a motion to charge garnishee to reach funds in the personal account. After a hearing, an order was entered granting Citizens' motion to charge garnishee and denying Kymberly's objection to the attachment of funds. The Supreme Court affirmed, concluding that, according to precedent, a bank has a right to use funds in a joint account to set off the debt of one account holder, regardless of whether that holder contributed any funds to the account. The Court then held that Citizens had a right to set off Howard's debt with the funds in the joint account to which he and Kymberly were signatories.

Plaintiffs Mark and Karla Gibbs brought claims in the federal district court against, among other defendants, Corinthian Title, Jeffrey Brown, Shelley Hickson, and Christine Tueckes, for civil conspiracy. The above defendants argued that the federal district court did not have in personam jurisdiction over them because Arkansas's long-arm statute does not allow application of conspiracy jurisdiction. The federal district court certified to the Supreme Court the question of whether the use of the conspiracy theory of in personam jurisdiction violates the state's long-arm statute. The Court answered in the negative. Arkansas's long-arm statute does not limit the exercise of personal jurisdiction to certain enumerated circumstances and is therefore limited only by federal constitutional law. Because jurisdiction based on the conspiracy theory does not violate due process, the conspiracy theory of in personam jurisdiction does not violate Arkansas's long-arm statute.