Justia Consumer Law Opinion Summaries

After purchasing a used car in Oklahoma with his then-wife, Alexander Ross divorced and relocated to Michigan, while his ex-wife kept the car in Oklahoma. The couple fell behind on payments, leading their creditor to repossess and sell the vehicle. The creditor retained an Oklahoma law firm, Robinson, Hoover & Fudge, PLLC (“RHF”), to sue both parties for the outstanding balance in Oklahoma state court. After unsuccessful attempts to serve Ross personally, including publishing notice in an Oklahoma newspaper, the court entered a default judgment against him. RHF later learned that Ross was residing and working in Michigan and proceeded to use the Oklahoma judgment to garnish Ross’s wages from his Michigan-based employer, Detroit Diesel.Ross filed suit against RHF in the United States District Court for the Eastern District of Michigan, alleging violations of the Fair Debt Collection Practices Act (FDCPA) and Michigan’s Regulation of Collection Practices Act (MRCPA). He claimed that RHF unlawfully garnished his Michigan wages without first domesticating the Oklahoma judgment as required by Michigan law. RHF moved to dismiss the case for lack of personal jurisdiction. The district court granted the motion, holding that RHF did not have sufficient contacts with Michigan to justify the exercise of personal jurisdiction.The United States Court of Appeals for the Sixth Circuit reversed the district court’s dismissal. The appellate court held that RHF had purposefully directed its actions at Ross in Michigan with knowledge of his residence and employment there, and that its actions caused harm in Michigan. The court found that both Michigan’s long-arm statute and the Due Process Clause permitted the exercise of personal jurisdiction over RHF. Accordingly, the Sixth Circuit remanded the case for further proceedings. View "Ross v. Robinson, Hoover & Fudge, PLLC" on Justia Law

A Wisconsin statute enacted in 2023 required that electronic nicotine delivery systems (such as vapes and e-cigarettes) could only be sold in the state if they had received premarket authorization from the Food and Drug Administration (FDA), were pending FDA review as of specified dates, or did not contain nicotine. The law also imposed financial penalties and authorized private lawsuits against violators. Several businesses and consumers involved in the manufacture, distribution, retail, and use of these products challenged the statute, arguing that federal law granting the FDA authority over tobacco products preempted the Wisconsin statute. They also asserted that the law violated the Equal Protection Clause, and sought preliminary and permanent injunctions to prevent enforcement.The United States District Court for the Western District of Wisconsin denied the motion for a preliminary injunction. The district court found that the Wisconsin law was not preempted by federal statutes, specifically the Federal Food, Drug, and Cosmetic Act (FDCA) and the Family Smoking Prevention and Tobacco Control Act (TCA). The court concluded that Congress had not intended to preempt states from imposing additional or more stringent requirements on the sale of tobacco products, and that the plaintiffs had not shown a likelihood of success on the merits or that the balance of equities favored an injunction.On appeal, the United States Court of Appeals for the Seventh Circuit reviewed the district court’s decision. The Seventh Circuit held that the text and structure of the relevant federal statutes, including the TCA’s preservation and savings clauses, demonstrated that Congress did not preempt state authority to regulate, or even prohibit, the sale of tobacco products. The court affirmed the district court’s denial of a preliminary injunction, holding that the plaintiffs had failed to show a reasonable likelihood of success on the merits of their preemption claim. View "Wisconsinites for Alternatives to Smoking v. Casey" on Justia Law

Several individuals alleged that Google collected and misused the private browsing data of Chrome users who utilized Incognito mode, despite Google’s representations about the privacy of this feature. In June 2020, five plaintiffs brought a putative class action on behalf of these users, seeking both injunctive relief and damages. After extensive discovery, the United States District Court for the Northern District of California certified a class for injunctive relief but denied certification for a damages class, finding the plaintiffs had not shown that common issues predominated over individual ones.Following the denial of damages class certification, the named plaintiffs sought review in the United States Court of Appeals for the Ninth Circuit under Rule 23(f), but the petition was denied. The case proceeded, and as trial approached, the parties settled: Google agreed to change its policies, the named plaintiffs would arbitrate their individual damages claims, and they waived their rights to appeal the denial of damages class certification. The settlement explicitly stated that absent class members were not releasing damages claims or appellate rights. Several months after the settlement, a group of 185 Chrome users, referred to as the Salcido plaintiffs, moved to intervene to preserve absent class members’ appellate rights regarding damages.The United States Court of Appeals for the Ninth Circuit reviewed the district court’s denial of the intervention motion. The Ninth Circuit held that the district court did not abuse its discretion in finding the intervention motion untimely. Applying the circuit’s traditional three-part test for intervention—considering the stage of the proceedings, prejudice to other parties, and the reason for and length of delay—the court found that intervention at this late stage would prejudice the existing parties, that the delay was unjustified, and that the timing weighed against intervention. The denial of the motion to intervene was therefore affirmed. View "BROWN V. SALCIDO" on Justia Law

In June 2020, an individual purchased a recreational vehicle manufactured by two companies. The vehicle quickly developed problems, prompting the owner to seek repairs on multiple occasions and to notify the manufacturers of ongoing defects. Over the course of about two years, the vehicle underwent several repair attempts by both manufacturers and their authorized agents. After further repair offers were declined by the owner, statutory defect notices were sent, and additional repairs were made. The owner eventually sought relief under Florida’s Lemon Law, alleging that the manufacturers failed to adequately repair the defects.The dispute was submitted to arbitration pursuant to Florida Statute § 681.1095. The arbitration board concluded that the owner did not meet the burden of eligibility for a refund under the Lemon Law and only ordered limited repairs. The owner then appealed to the United States District Court for the Southern District of Florida. That court granted summary judgment for both manufacturers, holding that the owner failed to establish entitlement to relief because the statutory presumptions for repairs or days out-of-service were not met, and deemed as admitted the manufacturers’ statements of material facts due to procedural deficiencies in the owner’s filings.On appeal, the United States Court of Appeals for the Eleventh Circuit found that the district court erred by treating the statutory presumptions in Florida’s Lemon Law as mandatory requirements for relief. The court clarified that these presumptions are not prerequisites but rather examples of when a “reasonable number of attempts” has been made. Applying the correct standard, the appellate court affirmed summary judgment for one manufacturer because the owner failed to satisfy initial notice and repair requirements. However, as to the other manufacturer, it found genuine disputes of material fact regarding whether a reasonable number of attempts had been made and therefore reversed and remanded for further proceedings. View "Joyce v. Forest River, Inc." on Justia Law

A police officer employed by the Metropolitan Police Department experienced a data breach that exposed sensitive information of numerous employees. In response, the officer filed a putative class action in Superior Court for the District of Columbia, naming the District, certain government entities, and several private technology contractors as defendants. The complaint alleged that the defendants failed to safeguard employees’ data.During the proceedings, the plaintiff voluntarily dismissed certain contractor defendants without prejudice, leaving the government defendants and a few contractors. The Superior Court of the District of Columbia granted the District’s motion to dismiss, ruling that the Metropolitan Police Department and the Office of the Chief Technology Officer could not be sued as unincorporated government bodies, and that sovereign immunity barred the claims against the District. The plaintiff’s motion for reconsideration was denied. Subsequently, the plaintiff voluntarily dismissed without prejudice the remaining private contractor defendants and asked the Superior Court to close the case. The Superior Court closed the case, prompting the plaintiff to appeal both the dismissal of her claims against the District and the denial of reconsideration.The District of Columbia Court of Appeals reviewed the case. It held that because the plaintiff dismissed her claims against the final contractor defendants without prejudice, the trial court’s order was not final as to all parties and claims. The court explained that dismissals without prejudice do not resolve the merits and thus do not confer appellate jurisdiction, except in rare circumstances. The Court of Appeals dismissed the appeal for lack of jurisdiction, as the order below was not a final, appealable order. View "Moore v. District of Columbia" on Justia Law

A consumer purchased a set of bed sheets from a major retailer, choosing a more expensive option because the packaging stated the sheets were made of “100% cotton” and had an “800 Thread Count.” After using the sheets, he believed the quality did not match the advertised thread count. He later had the sheets tested by an expert, who determined the actual thread count was much lower. The consumer alleged that it is physically impossible for 100% cotton fabric to reach the advertised thread counts and claimed that the retailer’s labeling was false and misleading.The consumer initially brought a class action in California state court, alleging violations of California’s Unfair Competition Law and Consumer Legal Remedies Act. The retailer removed the suit to the United States District Court for the Southern District of California. The retailer moved to dismiss the complaint, arguing that the consumer failed to adequately plead his claims and that the impossibility of the claimed thread count meant no reasonable consumer would be misled. The district court agreed and dismissed the case with prejudice, relying on the Ninth Circuit’s decision in Moore v. Trader Joe’s Co., interpreting it to mean that literally impossible claims cannot deceive reasonable consumers as a matter of law.The United States Court of Appeals for the Ninth Circuit reviewed the dismissal de novo. The court held that the district court erred in its interpretation of Moore. The appellate court clarified that claims of literal falsity are actionable under California consumer protection laws and that even physically impossible claims may deceive reasonable consumers. The court reversed the district court’s dismissal and remanded the case for further proceedings, holding that the consumer’s allegations were sufficient to survive a motion to dismiss. View "PANELLI V. TARGET CORPORATION" on Justia Law

Two individuals brought a putative class action against the owners of a hotel in San Dimas, California, alleging that the hotel violated Civil Code section 1940.1. The statute is designed to prevent hotels from forcing guests to move out or check out and reregister every 28 days—a practice aimed at denying guests tenant protections that accrue after 30 days of occupancy. The hotel enforced a policy requiring all guests to vacate after 28 consecutive days and to stay away for at least three days before re-registering. Plaintiffs, who stayed at the hotel in multiple 28-day increments, were subject to this policy and sometimes stayed elsewhere or in their vehicle during the three-day interval.The plaintiffs filed a class action in the Superior Court of Los Angeles County, seeking to represent all individuals who had similar experiences at the hotel since November 2018. They argued that the hotel’s uniform policy and its status as a “residential hotel” made the case appropriate for class certification. The defendants countered that determining whether the hotel was a “residential hotel” under the statute would require individualized inquiries into whether each guest used the hotel as their primary residence. The trial court agreed with the defendants’ interpretation and denied class certification, finding that individual questions predominated over common ones.The California Court of Appeal, Second Appellate District, Division Three, reviewed the order denying class certification. The appellate court held that the trial court erred by interpreting section 1940.1 to require individualized proof that each class member used the hotel as their primary residence. The appellate court clarified that the “residential” status of the hotel is determined by the hotel’s overall use or intended use, not by each guest’s individual residency status. The court reversed the order denying class certification and remanded the case for further proceedings. View "Aerni v. RR San Dimas, L.P." on Justia Law

A consumer purchased a Brita water filter product, alleging that the product’s labeling and packaging led him to believe it would remove or reduce hazardous contaminants in tap water to below laboratory-detectable levels. He contended that the packaging conveyed the impression that the product would eliminate a broad range of harmful substances, but did not clearly or conspicuously state that it would not do so. The consumer claimed that he would not have purchased the product or would have paid less if he had known its actual capabilities, and asserted that reasonable consumers would have similar expectations based on the labeling.After Brita removed the lawsuit to the United States District Court for the Central District of California, the district court dismissed the complaint in its entirety without leave to amend. The district court found that the plaintiff’s claims for affirmative misrepresentation and material omission failed, applying the reasonable consumer standard and concluding that no reasonable consumer would interpret Brita’s packaging as promising removal of all hazardous contaminants to below lab-detectable limits. The district court also found the plaintiff lacked standing for certain statutory claims and determined that amendment would be futile.The United States Court of Appeals for the Ninth Circuit reviewed the district court’s dismissal and affirmed the decision. The appellate court held that no reasonable consumer would expect Brita’s water filter products to remove or reduce all hazardous contaminants to below laboratory-detectable levels, especially in light of Brita’s disclosures about the products’ capabilities and limitations. The court further held that the omission claim failed as a matter of law under the reasonable consumer standard. Finally, the appellate court concluded that the district court did not abuse its discretion by denying leave to amend, as amendment would not cure the defect. Judgment was affirmed. View "BROWN V. THE BRITA PRODUCTS COMPANY" on Justia Law

Two former tenants sued the owner and manager of a residential apartment complex, alleging that they were charged unlawful rental application fees and excessive lock change fees, in violation of the Massachusetts security deposit statute and consumer protection laws. They sought to represent a statewide class of similarly situated tenants. After contentious discovery, the Superior Court sanctioned the defendants, precluding them from contesting certain liability facts. The court granted summary judgment to the plaintiffs on the security deposit claims but denied summary judgment on the consumer protection claims. Before trial, the parties reached a proposed class action settlement that established a fund for class members, with unclaimed funds to be distributed partly to charities and partly returned to the defendants.The Superior Court, after scrutiny and required revisions, approved the settlement. The court capped the amount of unclaimed funds that could revert to the defendants and required that a portion go to designated charities. However, the Massachusetts IOLTA Committee, a nonparty potentially entitled to notice under Mass. R. Civ. P. 23(e)(3), was not notified prior to settlement approval. After final approval and claims processing, the committee received notice for the first time and objected to the final distribution of unclaimed funds, arguing that the lack of timely notice violated the rule and that final judgment should be set aside. The motion judge agreed there was a violation but declined to vacate the settlement, finding no prejudice.On direct appellate review, the Supreme Judicial Court of Massachusetts held that the IOLTA Committee had standing to appeal the denial of its procedural right to notice and an opportunity to be heard on the disposition of residual funds, but lacked standing to challenge the overall fairness or structure of the settlement. Assuming a violation of the rule occurred, the Court found no prejudice because the committee ultimately received the opportunity to be heard before judgment entered. The judgment was affirmed. View "Ortins v. Lincoln Property Company" on Justia Law

An Iranian citizen, living in the United States, held a credit card account with a large financial institution. Due to United States sanctions against Iran, federal regulations prohibit U.S. banks from providing services to accounts of individuals ordinarily resident in Iran, unless those individuals are not located in Iran. The bank had a compliance policy requiring account holders from such sanctioned countries to regularly provide documents showing they were not residing in those countries. The plaintiff, subject to this policy, submitted various documents as proof of U.S. residency. After the bank mistakenly treated one of his residency documents as temporary rather than permanent, it closed his account when he failed to submit additional documentation.The plaintiff sued in state court, alleging violations of federal and state anti-discrimination and consumer protection statutes, including 42 U.S.C. § 1981, the Equal Credit Opportunity Act, the California Unruh Civil Rights Act, and the California Unfair Competition Law. The defendant bank removed the case to the United States District Court for the Southern District of California. The district court granted summary judgment for the bank on all claims except for an ECOA notice claim and a related UCL claim, both of which the plaintiff later voluntarily dismissed. The plaintiff then appealed.The United States Court of Appeals for the Ninth Circuit held that the International Emergency Economic Powers Act’s liability shield provision immunizes the bank from liability for good faith actions taken in connection with compliance with sanctions regulations, even if such actions are not strictly compelled by the regulations. The court found that the bank’s policy was consistent with federal guidance and that the plaintiff failed to show a genuine dispute of material fact regarding the bank’s good faith. The Ninth Circuit affirmed the district court’s judgment in favor of the bank. View "NIA V. BANK OF AMERICA, N.A." on Justia Law