Justia Consumer Law Opinion Summaries

The United States Court of Appeals for the Ninth Circuit certified a question of law to the Oregon Supreme Court. Defendants Eddie Bauer LLC and Eddie Bauer Parent, LLC, operate the Eddie Bauer Outlet chain of stores, where they sell branded clothing. More than 90 percent of the products offered at the outlet stores are manufactured solely for sale at the outlet stores and were not sold elsewhere. Defendants advertised clothing at the Eddie Bauer Outlet stores as being sold at a substantial discount; with limited exceptions, the clothing was never sold at the “list” price. In 2017, plaintiff Susan Clark purchased two articles of clothing from one of defendants’ outlet stores in Oregon. Plaintiff filed a complaint in federal district court, alleging that defendants had violated multiple provisions of the UTPA, including, among others, ORS 646.608(1)(j) (making false or misleading representations of fact concerning the reasons for, existence of, or amounts of price reductions), and ORS 646.608(1)(ee) (advertising price comparisons without conspicuously identifying the origin of the price the seller is comparing to the current price). Plaintiff alleged she had been fraudulently induced to buy those garments by defendants’ false representation that she was buying them at a bargain price. Defendants moved to dismiss plaintiff’s complaint on the ground that it failed to allege an “ascertainable loss of money or property,” as required of a complainant pursuing a private right of action under the UTPA. The federal appellate court asked the Supreme Court whether a consumer suffered an "ascertainable loss" when the consumer purchased a product that the consumer would not have purchased at the price that the consumer paid but for a violation of [ORS] 646.608(1)(e), (i), (j), (ee), or (u), if the violation arose from a representation about the product’s price, comparative price, or price history, but not about the character or quality of the product itself. The Oregon Court answered the Ninth Circuit's question in the affirmative. View "Clark v. Eddie Bauer LLC" on Justia Law

Ford Motor Company advertised its Shelby GT350 Mustang as “track ready.” But some Shelby models weren’t equipped for long track runs, and when the cars overheated, they would rapidly decelerate. A group of Shelby owners sued Ford on various state-law fraud theories and sought class certification, which the district court granted in substantial part. Ford challenged class certification on the ground that proving each plaintiff’s reliance on the alleged misinformation requires individualized proof and, therefore, that common questions don’t “predominate” within the meaning of Federal Rule of Civil Procedure 23(b)(3).   The Eleventh Circuit affirmed the district court’s certification of the statutory classes in Florida, New York, Missouri, and Washington. The court reversed the certification of the Texas statutory consumer-fraud claim and the Tennessee, New York, and Washington common-law fraud claims. And the court remanded for the district court to consider whether the facts, in this case, support a presumption of reliance for the California statutory and common-law fraud claims and whether California- and Texas-based breach-of-implied-warranty claims satisfy state-law requirements. Finally, the court instructed the district court on remand to reconsider the manageability issue. View "George Tershakovec, et al v. Ford Motor Company, Inc." on Justia Law

The Federal Communications Commission (FCC) provides subsidies to encourage telecommunication companies to expand high-speed broadband internet services in rural areas where customer revenues would otherwise be insufficient to justify the cost of doing business. Venture Communications Cooperative (“Venture”) provides broadband services to rural South Dakota customers. James Valley Cooperative Telephone Company and its wholly owned subsidiary, Northern Valley Communications (collectively, “Northern Valley”), is a competing provider. Venture filed this lawsuit against Northern Valley. The primary claim is that Northern Valley violated 47 U.S.C. Section 220(e) by filing a Form 477 that “intentionally, deliberately, fraudulently, and maliciously misrepresented” information “for the sole unlawful purpose of harming [Venture]” by depriving Venture of FCC subsidies in census blocks where Northern Valley was deemed to be an unsubsidized competitor. The district court granted Northern Valley summary judgment, concluding “there is no evidence that Northern Valley willfully overreported its broadband capabilities.”   The Eighth Circuit affirmed. The court explained that Venture’s claim of intent to injure is belied by Northern Valley helping Venture by filing a letter with the FCC clarifying that Northern Valley did not offer voice service in the Overlap Area. The court likewise affirmed the dismissal of Venture’s tortious interference and civil conspiracy claims under South Dakota law. The court agreed with the district court that Venture proffered no evidence of an “intentional and unjustified act of interference” because Northern Valley complied with all FCC reporting requirements. As Northern Valley complied with the Telecommunications Act in filing Form 477 at issue, there is no plausible underlying tort alleged. Summary judgment is warranted on this claim. View "Venture Comm. Co-Op, Inc. v. James Valley Co-Op Telephone Co." on Justia Law

Frazier obtained a home mortgage loan for which Dovenmuehle served as sub-servicer. Beginning in October 2015, Frazier failed to make her monthly payments. Frazier successfully negotiated and settled her debt through a short sale of her home, which closed in January 2016. Frazier was later denied a new mortgage loan because her Equifax credit report reflected late payments on her previous mortgage in months following the short sale. She disputed the information to several credit reporting agencies. To confirm the accuracy of its records, Equifax sent Dovenmuehle four Automated Consumer Dispute Verification forms in 2019-2020. Frazier contends the amended codes Dovenmuehle gave Equifax for Pay Rate and Account History were inaccurate, pointing to how Equifax interpreted and reported the amended data in her credit reports.Frazier sued under the Fair Credit Reporting Act, 15 U.S.C. 1681, claiming that Dovenmuehle failed to conduct a reasonable investigation of disputed data and provided false and misleading information to credit reporting agencies. She relied on evidence about persisting inaccuracies in Equifax’s credit reports produced using the amended data. The district court granted Dovenmuehle summary judgment. The Seventh Circuit affirmed. Given the full record, no reasonable jury could find that Dovenmuehle provided patently incorrect or materially misleading information. View "Frazier v. Dovenmuehle Mortgage, Inc." on Justia Law

Herbal Brands, Inc., which has its principal place of business in Arizona, brought suit in Arizona against New York residents that sell products via Amazon storefronts. Herbal Brands alleged that Defendants’ unauthorized sale of Herbal Brands products on Amazon to Arizona residents and others violated the Lanham Act and state law. The district court dismissed for lack of personal jurisdiction over Defendants.   The Ninth Circuit reversed. The panel held that if a defendant, in its regular course of business, sells a physical product via an interactive website and causes that product to be delivered to the forum, then the defendant has purposefully directed its conduct at the forum such that the exercise of personal jurisdiction may be appropriate. The panel applied the Arizona long-arm statute, which provides for personal jurisdiction co-extensive with the limits of federal due process. Due process requires that a nonresident defendant must have “certain minimum contacts” with the forum such that the exercise of personal jurisdiction does not offend traditional notions of fair play and substantial justice.   The panel held that Herbal Brands met its initial burden of showing that Defendants purposefully directed their activities at the forum because, under the Calder effects test, Defendants’ sale of products to Arizona residents was an intentional act, and Herbal Brands’ cease-and-desist letters informed defendants that their actions were causing harm in Arizona. The court held that Defendants had sufficient minimum contacts with Arizona, Herbal Brands’ harm arose out of those contacts, and the exercise of personal jurisdiction would be reasonable in the circumstances. View "HERBAL BRANDS, INC. V. PHOTOPLAZA, INC., ET AL" on Justia Law

The Ninth Circuit Court of Appeals certified a question of law to the Oregon Supreme Court. Under Oregon’s Unlawful Trade Practices Act (UTPA), a person who suffers an “ascertainable loss of money or property” as a result of another person’s violation of the UTPA may maintain a private action against that person. The Ninth Circuit's question required a determination of whether a consumer could suffer an “ascertainable loss” under the UTPA based on a retailer’s misrepresentation about price history or comparative prices. More specifically, the Oregon Court had to consider whether a consumer suffered a cognizable “ascertainable loss” under ORS 646.638(1) when she buys items at an outlet store that have been advertised as being sold at a substantial discount but that have never been sold at that or any other location at the “list,” or non-sale price. To this, the Oregon Court responded in the affirmative. View "Clark v. Eddie Bauer LLC" on Justia Law

The Supreme Judicial Court held that, under the circumstances of the underlying case, the Graves Amendment, 49 U.S.C. 30106, protected an automobile dealership from being held vicariously liable for the tortious conduct of the driver of its courtesy vehicle.An automobile dealership based in New Jersey provided a courtesy vehicle to a customer while it serviced the customer's vehicle in its automobile service center. Contrary to the terms of the courtesy vehicle agreements, the customer drove the vehicle beyond the permitted radius of travel and into the Commonwealth, where the vehicle struck one of the plaintiffs, causing serious injuries. Plaintiffs brought a negligence action against the dealership and the customer. The superior court granted summary judgment for Defendants, concluding that the dealership, as the owner of the courtesy vehicle, was presumptively vicariously liable for the injuries caused by the customer's wife. The Supreme Judicial Court affirmed the judgment for the dealership and vacated the judgment for the customer, holding (1) the Graves Amendment protected the dealership from liability in this case; and (2) there was a dispute of material fact as to the negligent entrustment claim against the customer. View "Garcia v. Steele" on Justia Law

This appeal involved the effect of an antiwaiver provision of the Song-Beverly Consumer Warranty Act on a release executed as part of a pre-litigation settlement between plaintiff-appellant Derek Rheinhart and defendants-respondents Nissan North America, Inc. and Mossy Nissan, Inc. (collectively Nissan) over issues that had arisen with Rheinhart’s leased Nissan vehicle. After Rheinhart entered into the settlement agreement and release, he filed a lawsuit alleging violations of the Act and seeking repurchase of his vehicle as well as other statutory remedies. Nissan moved for summary judgment on grounds the settlement agreement and release, which Rheinhart admitted he read and had an opportunity to review before signing, extinguished his claims. The trial court granted the motion, finding section 1790.1 of the Act applied to waivers of consumer warranties in connection with a product purchase, not to releases negotiated to end disputes about those warranties, and thus rejected Rheinhart’s argument that the settlement was unenforceable. Rheinhart contends the court erred. He argued the settlement agreement and release violated section 1790.1 and was unenforceable as a matter of law. The Court of Appeal reversed, finding the settlement agreement and release contravened Rheinhart’s substantive rights under the Act and was void and unenforceable as against public policy. View "Rheinhart v. Nissan North America" on Justia Law

Plaintiff Vitamins Online, Inc. believed that its competitor, Defendant Heartwise, Inc. (d/b/a NatureWise), was misrepresenting the ingredients of its competitive nutritional supplements and manipulating those products’ Amazon reviews. Vitamins Online sued for violations of the Lanham Act and Utah’s common law Unfair Competition Law. The case proceeded to a bench trial, at the conclusion of which the district court ruled for Vitamins Online and ordered disgorgement of NatureWise’s profits for 2012 and 2013. The court also awarded Vitamins Online attorney fees and costs for NatureWise’s willful misrepresentation and for various discovery abuses. Both parties appealed. NatureWise contended the district court erred in finding that it made false or misleading representations about its own nutritional supplements’ ingredients and its Amazon reviews. NatureWise further asserted the district court erred in concluding that Vitamins Online was entitled to a presumption of injury for these misrepresentations. Vitamins Online contended the district court erred in bifurcating Vitamins Online’s injury into two separate time periods and requiring Vitamins Online to prove that a presumption of injury was applicable separately for each period. Vitamins Online also argued the district court erred in denying disgorgement for the second time period, and for failing to consider an award of punitive damages and an injunction as to NatureWise’s further manipulation of reviews. The Tenth Circuit concluded the district court did not clearly err in applying a presumption of injury, and affirmed the award of profits, attorney fees, and costs, and found no reversable error in the amount awarded. The Court also held the district court failed to consider properly Vitamins Online’s request for punitive damages and an injunction; the Court remanded for the district court to reconsider. View "Vitamins Online, Inc. v. HeartWise, Inc." on Justia Law

After receiving a flood of telemarketing phone calls concerning debt relief through lower interest rates on credit cards, Appellee brought suit pursuant to the Telephone Consumer Protection Act (“TCPA”), and the West Virginia Consumer Credit and Protection Act (“WVCCPA”), against several defendants. Throughout the course of the litigation, Appellants failed to respond fulsomely and accurately to discovery requests and to comply with court orders pertaining to those requests. As a sanction for their repeated discovery violations, the district court entered a default judgment against Appellants.   The Fourth Circuit affirmed, concluding that the district court did not abuse its discretion by finding that Appellants acted in bad faith and entered a default judgment against them. The court explained that because the damages consisted strictly of statutory penalties, the amount of which was readily discernable on the basis of undisputed evidence in the record, the district court did not abuse its discretion by entering judgment in favor of Appellee and awarding statutory damages without a trial. Further, because penalties under the TCPA and WVCCPA are not exclusive and the statutes separately penalize different violative conduct, damages under the WVCCPA may be awarded in addition to those under the TCPA for a single communication that violates both statutes. View "Diana Mey v. Judson Phillips" on Justia Law