Justia Consumer Law Opinion Summaries

Bouye financed a furniture purchase with Winner through a retail installment contract (RIC). Winner supposedly sold the debt to Mariner. Bouye defaulted. Mariner, through its attorney (Bruce), sued in state court to recover the debt and attorney’s fees “of one-third of the amount" collected; the RIC limited fees to 15% of the unpaid balance. The attached RIC did not establish a transfer to Mariner. The court ordered Mariner to file proof of assignment. Mariner filed an updated RIC that listed Winner’s store manager as assigning the debt to Mariner. The court granted Mariner summary judgment. The Kentucky appellate court found that Mariner had not sufficiently demonstrated a valid transfer. Mariner dismissed the case.Bouye sued Bruce in federal court under the Fair Debt Collection Practices Act, 15 U.S.C. 1692(e), 380 days after Mariner sued in state court. The district court dismissed the complaint as untimely under FDCPA’s one-year limitations period. Bruce sought attorney’s fees. Meanwhile, Bouye and Mariner entered into a settlement that released Mariner, later clarifying that Bruce was not released.Three months before the court denied motions for reconsideration and attorney’s fees, Bruce learned of the settlement. The Sixth Circuit first held the settlement did not moot the appeal, then reversed, The statute of limitations did not bar an allegation Bruce filed an updated RIC and moved for summary judgment on that basis, affirmatively misrepresenting that the assignment occurred before Mariner filed suit. View "Bouye v. Bruce" on Justia Law

Securus Technologies, LLC (Securus), is one of six telecommunications companies providing incarcerated persons calling services (IPCS) in California. In this original proceeding, Securus challenges the decision of the California Public Utilities Commission (PUC) adopting interim rate relief for IPCS in the first phase of a two-phase rulemaking proceeding. Among other things, the PUC’s decision: (1) found IPCS providers operate as locational monopolies within the incarceration facilities they serve and exercise market power; (2) adopted an interim cap on intrastate IPCS rates of $0.07 per minute for all debit, prepaid, and collect calls; and (3) prohibited providers from charging various ancillary fees associated with intrastate and jurisdictionally mixed IPCS.   The Second Appellate District affirmed the PUC’s decision. The court concluded Securus has not shown the PUC erred by finding providers operate locational monopolies and exercise market power. The court held that facts do not—as Securus contends—demonstrate Securus “cannot recover its costs (including a reasonable rate of return)” under the interim rate cap and do not amount to a “clear showing” that a rate of $0.07 per minute “is so unreasonably low” that “it will threaten Securus’s financial integrity.” Thus, Securus has failed to satisfy its “burden of proving . . . prejudicial error” on constitutional grounds. View "Securus Technologies v. Public Utilities Com." on Justia Law

A major data breach compromised sensitive consumer information on thousands of credit cards. In this appeal, we address who must pay for the cleanup. Beginning in 2014, hackers compromised credit card data at multiple businesses owned by Landry’s Inc. (“Landry’s”). Many of those cards belonged to Visa and Mastercard. In response, Visa and Mastercard imposed over twenty million dollars in assessments on JPMorgan Chase and its subsidiary Paymentech (collectively, “Chase”), who were responsible for securely processing card purchases at Landry’s properties. Chase then sued Landry’s for indemnification, and Landry’s impleaded Visa and Mastercard. The district court dismissed Landry’s third-party complaints against Visa and Mastercard and granted summary judgment for Chase, finding that Landry’s had a contractual obligation to indemnify Chase. Landry’s argued that it should not have to indemnify Chase because the assessments are not an enforceable form of liquidated damages.   The Fifth Circuit affirmed. The court explained that since Landry’s indemnification obligation stems from its own acts or omissions under the Merchant Agreement, the debt is its own. Further, the court wrote that Landry’s alleged for its deceptive business practices claims that the assessments were “invalid” under the Payment Brand Rules and “applicable law” and, therefore, the Payment Brands’ “imposition and collection of the [assessments] was an unlawful business practice.” Because these claims turn on the assessments’ enforceability under Chase’s contracts with the Payment Brands, they are functionally the same as the subrogated claims. Since Landry’s cannot challenge the Payment Brands over those contracts as Chase’s subrogee, it cannot do so through a change in labeling. View "Paymentech v. Landry's" on Justia Law

Plaintiff sued Credit Bureau Services, Inc. and C.J. Tighe (collectively, the “collectors”) for unfair debt-collection practices. The district court granted judgment as a matter of law to Plaintiff and the plaintiff class. The collectors appealed, alleging amongst various issues, (i) Plaintiff does not have Article III standing, (ii) the district court erred in allowing her to introduce an issue at trial without notice, (iii) the district court erred in determining that the NCPA requires a judgment before collecting prejudgment interest, (iv) the district court abused its discretion in finding Plaintiff an adequate class representative, and (v) the district court abused its discretion in certifying the FDCPA class.   The Eighth Circuit vacated the district court’s judgment. The court held that Plaintiff did not suffer a concrete injury in fact as a result of the alleged statutory violations, thus, she lacks Article III standing. The court explained that Plaintiff contends that she suffered an injury in fact when the collectors demanded interest on her debts without a judgment. However, the court reasoned that Plaintiff only received the letter and never paid any part of the interest or principal. Without suffering a tangible harm, Plaintiff must point to an injury that “has a ‘close relationship’ to a harm ‘traditionally’ recognized as providing a basis for a lawsuit in American courts.” Here, Plaintiff has not shown any harm that bears a “close relationship” to the type of injury that results from reliance on a misrepresentation or wrongful interference with property rights. View "Kelly Bassett v. Credit Bureau Services, Inc." on Justia Law

Plaintiff appealed the dismissal of his claim against TrustedID, Inc. under South Carolina’s Financial Identity Fraud and Identity Theft Protection Act (the “Act”), S.C. Code Ann. Section 37-20-180. The district court held that Plaintiff alleged an Article III injury in fact but failed to state a claim under the Act. Plaintiff agrees with the district court’s decision on standing but appeals its Rule 12(b)(6) dismissal.   The Fourth Circuit vacated and remanded with instructions to remand this case to state court where it originated. The court conceded that it is odd that TrustedID failed to comply with the five-digit SSN cutoff, which doesn’t appear to be unique to South Carolina’s Act. But federal courts can’t entertain a case without a concrete injury in fact. The court offered no opinion about whether the alleged facts state a claim under the Act. Absent Article III jurisdiction, that’s a question for Plaintiff to take up in state court. View "Brady O'Leary v. TrustedID, Inc." on Justia Law

Plaintiffs represent a putative class of ticket purchasers (“Ticket Purchasers”) against Defendants Ticketmaster LLC and Live Nation Entertainment, Inc. (“Defendants”). Ticket Purchasers sued Defendants in federal district court, alleging anticompetitive practices in violation of the Sherman Act. Defendants moved to compel arbitration on the basis of their websites’ terms of use (“Terms”). The court granted the motion and dismissed the case, holding that the Terms constituted a valid agreement between the parties and that the requirements for mutual assent were met.   The Ninth Circuit affirmed. The panel held that the terms of use were not invalid under California law for failure to identify Defendants as parties to the agreement properly. The panel concluded that it was possible for a reasonable user to identify the parties to the contract based on the terms’ repeated references to Defendants' common trade names, express references to “Live Nation Entertainment, Inc.,” and available avenues that would enable a reasonable user to identify Ticketmaster’s full legal name. The panel further held that Defendants did not fail to provide constructive notice of the terms of use. The panel concluded that it need not engage in a detailed choice-of-law analysis between California and Massachusetts law because the two states’ laws apply substantially similar rules. Finally, the panel held the district court did not err in deciding the constructive notice issue as a matter of law. View "MITCH OBERSTEIN, ET AL V. LIVE NATION ENT'M'T, INC., ET AL" on Justia Law

Plaintiff brought a putative class action against Cash Advance Centers, Inc., alleging a violation of the Telephone Consumer Protection Act, 47 U.S.C. Section 227. Counsel purporting to represent Cash Advance Centers, Inc., moved to compel arbitration based on arbitration provisions contained in loan agreements between Plaintiff and non-party Advance America, Cash Advance Centers of Missouri, Inc. The district court denied the motion to compel. Counsel also moved to substitute Advance America, Cash Advance Centers of Missouri, Inc., for Cash Advance Centers, Inc., as the party defendant, but the district court denied that motion as well.
The Eighth Circuit affirmed. The court explained only parties to a lawsuit may appeal an adverse judgment. Because Advance America, Cash Advance Centers of Missouri, Inc., is not a party to the lawsuit, its notice of appeal is insufficient to confer jurisdiction on the Court. The non-party Advance America, Cash Advance Centers of Missouri, Inc., made no appearance in connection with the motion, and the court’s order addressed only a motion advanced by the party Defendant. The notice of appeal also names Cash Advance Centers, Inc., the party Defendant, as an appellant. But while attorneys purporting to represent Cash Advance Centers, Inc., filed a notice of appeal, counsel acknowledged at oral argument that she represented only non-party Advance America, Cash Advance Centers of Missouri, Inc., and not Cash Advance Centers, Inc. View "Kamisha Stanton v. Cash Advance Centers, Inc" on Justia Law

Plaintiff sued Defendants under the Truth in Lending Act ("TILA"), claiming that Defendant violated TILA because it did not provide him those disclosures. The question in this case was whether Plaintiff had Article III standing to pursue his claim, which turns on whether Plaintiff's injuries are traceable to Defendant's failure to disclose.The Eleventh Circuit found that Plaintiff's injuries were traceable to Defendant's failure to disclose and thus reversed the district court's finding to the contrary. The court, however, expressed no opinion about the merits of Plaitniff's claim. View "Gary Walters v. Fast AC, LLC, et al" on Justia Law

These original proceedings involve efforts by the Public Utilities Commission (PUC or the Commission) to discover whether the political activities of Southern California Gas Company (SCG) are funded by SCG’s shareholders, which is permissible, or ratepayers, which is not. The Commission propounded several discovery requests (called “Data Requests”) on SCG, and when SCG failed fully to comply, moved to compel further responses that ultimately resulted in an order to comply or face substantial penalties. SCG seeks a writ of mandate directing the Commission to rescind its order on the ground that the discovery requests infringe on SCG’s First Amendment rights.   The Second Appellate District granted the petition and held that SCG has shown that disclosure of the requested information will impact its First Amendment rights, and the Commission failed to show that its interest in determining whether SCG’s political efforts are impermissibly funded outweighs that impact. The court reasoned that because SCG demonstrated that a threat to its constitutional rights exists, the burden shifted to the Commission to demonstrate that the data requests serve and are narrowly tailored to a compelling governmental interest. However, the PAO’s discovery inquiries into all sources of funding for SCG’s lobbying activities go beyond ratepayer expenditures. Insofar as the requests seek information about shareholder expenditures, they exceed the PAO’s mandate to obtain the lowest possible costs for ratepayers and its authority to compel disclosure of information necessary for that task. The requests, therefore, are not carefully tailored to avoid unnecessary interference with SCG’s protected activities. View "So. Cal. Gas Co. v. P.U.C." on Justia Law

The Bureau of Consumer Financial Protection (“the CFPB”) promulgated the Prepaid Rule, which regulates digital wallets and other prepaid accounts. As relevant here, the Rule requires financial institutions to make certain disclosures by using model language or other “substantially similar” wording. Challenging the Rule on statutory, administrative, and constitutional grounds, PayPal sued the CFPB. The district court reached only PayPal’s statutory claims, vacating part of the Rule because it mandated a “model clause” in violation of the Electronic Fund Transfer Act (“EFTA”). In this case, PayPal and the CFPB proceed on the assumption that EFTA prohibits mandatory model clauses, and so the DC Circuit considered only whether the Prepaid Rule mandates such a clause.   The DC Circuit reversed. The court concluded the CFPB’s Prepaid Rule does not mandate a “model clause” in contravention of EFTA. That the Rule’s content and formatting requirements do not fall within the meaning of “model clause” does not necessarily mean the CFPB can impose whatever content and formatting requirements it chooses. The court directed that on remand, the district court may consider PayPal’s other challenges to the Rule, including the APA and constitutional claims, which remain to be addressed. View "PayPal, Inc. v. CFPB" on Justia Law