Justia Consumer Law Opinion Summaries

Plaintiff alleged that Preferred Collection had disclosed information about his debt to a third party—the mail vendor—in violation of the Fair Debt Collection Practices Act. Following the revised opinion, the full Eleventh Circuit voted to take the case en banc. The Eleventh Circuit vacated the district court’s order and remanded with instructions to dismiss the case without prejudice. The court held that Plaintiff did not have standing, thus the district court lacked jurisdiction to consider his claim.   The court explained that Plaintiff is simply no worse off because Preferred Collection delegated the task of populating data into a form letter to a mail vendor; the public is not aware of his debt (at least, not because of Preferred Collection’s disclosure to its vendor). Nor is it clear, or even likely, that even a single person at the mail vendor knew about the debt or had any reason—good, bad, or otherwise— to disclose it to the public if they did. Given the obvious differences between these facts and the traditional tort of public disclosure, the court found that no concrete harm was suffered here. View "Richard Hunstein v. Preferred Collection and Management Services, Inc." on Justia Law

The Supreme Court affirmed the order of the district court granting summary judgment in favor of Security State Bank (SSB) on its claims against Dellos Farms, Inc. and other related individuals and entities (Dellos defendants), holding that the district court did not err in ruling that the Wyoming Consumer Protection Act (WCPA), Wyo. Stat. Ann. 40-12-101 through 114, did not apply to the parties' transactions.In its complaint, SSB alleged that Dellos Farms defaulted on two promissory notes it had given to SSB for commercial agricultural loans and sought to foreclose on the collateral securing the notes. The Dellos defendants filed counterclaims alleging that SSB had engaged in improper lending practices under the WCPA. The district court granted summary judgment for SSB on its claims and on the Dellos defendants' counterclaims. The Supreme Court affirmed, holding that the plain language of the WCPA does not permit its application to commercial agricultural loans. View "Dellos Farms, Inc. v. Security State Bank" on Justia Law

A group of public servants who had contacted Navient for help repaying their loans (collectively, “Plaintiffs”) filed a putative class action lawsuit, alleging that Navient had not “lived up to its obligation to help vulnerable borrowers get on the best possible repayment plan and qualify for PSLF.”   Navient moved to dismiss the amended complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim, which the district court granted in part, dismissing all claims except “the claim brought under New York’s General Business Law Section 349”. The district court certified a class for settlement purposes under Federal Rule of Civil Procedure 23(b)(2) and approved the settlement as “fair, reasonable, adequate,” and “in the best interest of the Settlement Class as a whole.”   Two objectors now appeal that judgment, arguing that the district court erred in certifying the class, approving the settlement, and approving service awards of $15,000 to the named Plaintiffs. The Second Circuit affirmed concluding that the district court did not abuse its discretion in making any of these determinations. The court explained that here, the amended complaint plausibly alleged that the named Plaintiffs were likely to suffer future harm because they continued to rely on Navient for information about repaying their student loans. At least six of the named Plaintiffs continue to have a relationship with Navient. That is enough to confer standing on the entire class. Further, the court explained individual class members [in fact] retain their right to bring individual lawsuits,” and the settlement does not prevent absent class members from pursuing monetary claims. View "Hyland v. Navient Corporation" on Justia Law

Plaintiff sued I.C. System, Inc. (ICS) under the Fair Debt Collection Practices Act (FDCPA) for violating 15 U.S.C. Section 1692c(b), which prohibits a debt collector from contacting a third party about the collection of a debt without the prior consent of the consumer. The district court granted ICS’s motion for judgment on the pleadings, finding that Plaintiff, a non-consumer, lacked standing to bring a cause of action under Section 1692c(b).   The Eighth Circuit affirmed. The court explained that it joined the other circuits that have considered this issue in concluding that non-consumers cannot bring a claim under Section 1692c(b). The court further concluded that there was no abuse of discretion because Plaintiff failed to follow the applicable rules, including Eastern District of Missouri Local Rule 4.01(A). Further, the court wrote that Plaintiff confuses Article III standing, which implicates subject matter jurisdiction and is undisputed here, and statutory standing. Thus, because Plaintiff only alleged a violation of Section 1692c(b) and the district court correctly determined that Section 1692c(b) does not provide Plaintiff standing to sue, judgment as a matter of law was appropriate. View "Andrew Magdy v. I.C. System, Inc." on Justia Law

OneMain, a non-bank finance company, loaned Zirpoli $6,200.08, to be repaid at a rate of 26.91% (total $11,364.35). The loan was issued under the Consumer Discount Company Act (CDCA), a consumer protection statute, which creates an exception to Pennsylvania’s usury law. The loan is governed by a disclosure statement, a security agreement, and an arbitration agreement. Later, OneMain sold delinquent accounts to Midland, including Zirpoli’s loan. Midland sued Zirpoli but later dismissed the suit and undertook collection efforts.Zirpoli filed a class action, alleging that Midland’s collection activities constituted an unlawful attempt to collect the loan because Midland does not have a CDCA license and never obtained nor requested approval from the Department of Banking. Midland was, therefore, not lawfully permitted to purchase the loan. Midland moved to compel arbitration. The court denied the motion, focusing on the validity of the assignment from OneMain and Midland. The Third Circuit vacated. The ultimate illegality of a contract does not automatically negate the parties’ agreement that an arbitrator should resolve disputes arising from the contract. The parties to the loan clearly agreed to arbitrate the issue of arbitrability. The arbitration agreement provides that an arbitrator shall resolve the arbitrability of defenses to enforcement, including alleged violations of state usury laws. View "Zirpoli v. Midland Funding LLC" on Justia Law

Gripum manufactures and distributes flavored liquids for use in e-cigarette devices. Gripum submitted a “premarket tobacco product application” to the federal Food and Drug Administration (FDA) in 2021. The agency denied the application, reasoning that Gripum had failed to demonstrate public-health benefits as required by the Family Smoking Prevention and Tobacco Control Act, 21 U.S.C. 387j. The 2016 “Deeming Rule,” promulgated under the Act requires denial of an application to market a new tobacco product if the manufacturer fails to show that the product would be “appropriate for the protection of public health,” considering the risks and benefits to the population as a whole, including users and non-users, the “increased or decreased likelihood that existing users of tobacco products will stop using such products and those who do not use tobacco products will start using such products.The Seventh Circuit upheld the denial. The FDA required Gripum to show that its flavored e-cigarette products were relatively better at reducing rates of tobacco use than products already on the market. It properly applied the comparative standard mandated by the statute. Gripum failed to provide evidence specific to its products; its studies of other products did not even compare tobacco-flavored e-cigarette products to flavored products resembling Gripum’s products. View "Gripum, LLC v. United States Food and Drug Administration" on Justia Law

A regulatory scheme established by a Federal Communications Commission 1996 RF Order set exposure limits that included cell phones, and it remains largely intact today. Plaintiffs alleged that RF radiation emitted by iPhones regularly exceeded the federal exposure limit, and they brought eight claims against Apple under state tort and consumer-fraud laws. The district court held that plaintiffs’ state-law claims were preempted by federal law.The Ninth Circuit affirmed the district court’s summary judgment for Apple Inc. The court explained that a federal statute need not specify its preemptive force in order for the statute to have such a force, and Congress did not need to expressly delegate preemptive authority to the FCC for its regulations to preempt state law. View "ANDREW COHEN V. APPLE INC." on Justia Law

The consumers had rental applications denied based on inaccurate consumer reports generated by a consumer reporting agency, RealPage, which would not correct the reports unless the consumers obtained proof of the error from its sources. The identity of RealPage’s sources was not included in the disclosures to the consumers, despite their requests for their files. The consumers sued under the Fair Credit Reporting Act, 15 U.S.C. 1681, to disclose on request “[a]ll information in the consumer’s file at the time of the request” and “[t]he sources of th[at] information,” seeking damages and attorneys’ fees for themselves and on behalf of a purported class and subclass.The district court denied their Rule 23(b)(3) motion for class certification, citing the Rule’s predominance and superiority requirements and finding that their proposed class and subclass were not ascertainable. The Third Circuit vacated. The district court based its predominance analysis on a misinterpretation of Section 1681g(a), erroneously concluding that individualized proof would be needed to distinguish requests for “reports” from those for “files.” The court also misapplied ascertainability precedents. The consumers have standing, having made the requisite showing of the omission of information to which they claim entitlement, “adverse effects” that flow from the omission, and the requisite nexus to the protected “concrete interest.” View "Kelly v. RealPage Inc" on Justia Law

Kirtz obtained loans from the Pennsylvania Higher Education Assistance Agency (AES), a “public corporation” that makes, guarantees, and services student loans, and the USDA through the Rural Housing Service, which issues loans to promote the development of affordable housing in rural communities. Kirtz alleges that, as of June 2018, both of his loan accounts were closed with a balance of zero. AES and the USDA continued to report the status of Kirtz’s accounts as “120 Days Past Due Date” on his Trans Union credit file, resulting in damage to his credit score. Kirtz sent Trans Union a letter disputing the inaccurate statements. Trans Union gave AES and USDA notice of the dispute, as required by the Fair Credit Reporting Act (FCRA), 15 U.S.C. 1681. According to Kirtz, neither AES nor the USDA took any action to investigate or correct the disputed information.The district court dismissed Kirtz’s lawsuit, concluding that FCRA did not clearly waive the United States’ sovereign immunity. Courts of Appeals that have considered this issue are split. The Third Circuit reversed. FCRA’s plain text clearly and unambiguously authorizes suits for civil damages against the federal government. In reaching a contrary conclusion, the district court relied on its determination that applying the FCRA’s literal text would produce results that seem implausible. Implausibility is not ambiguity, and where Congress has clearly expressed its intent, courts may neither second-guess its choices nor decline to apply the law as written. View "Kirtz v. Trans Union LLC" on Justia Law

Petitioners petitioned for review concerning whether it was arbitrary and capricious for the Food and Drug Administration (FDA or Administration) to issue marketing denial orders to six tobacco companies for their electronic nicotine-delivery systems without considering the companies’ marketing and sales-access-restriction plans designed to minimize youth exposure and access. The Administration refused to consider the marketing and sales-access-restriction plans.   The Eleventh Circuit granted the petitions for review, set aside the orders of the Administration, and remanded to the Administration. The court concluded that it was arbitrary and capricious for the Administration to ignore the relevant marketing and sales-access restriction plans do not mandate a different result on remand. The court acknowledged the evidence in the record cataloged by the dissent of the serious risk to youth, and it may be that the Administration will conclude on remand that the marketing and sales-access restriction plans submitted in the tobacco companies’ applications do not outweigh those risks. The court wrote that it decides only that the Administration must at least consider the relevant evidence before it, which includes the companies’ marketing and sales-access-restriction plans. View "Bidi Vapor LLC v. U.S. Food and Drug Administration, et al" on Justia Law