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Litigation Byte (May Edition)

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The Litigation Byte is the new name and format for McGlinchey’s Commercial Law Bulletin. Our new format reflects McGlinchey’s national coverage and our expanded footprint while still serving up the digestible, insightful bites readers have come to expect, with timely coverage of financial services decisions and cases that impact you and your business. At the end of each month, our team will compile and send a round-up digest with all of our case summaries delivered to your inbox in one easy-to-reference place. Subscribe here.

New Jersey District Court Underscores Limits of “Safe Harbor” Protection Under Regulation F

On May 7, 2024, the U.S. District Court for the District of New Jersey issued a decision holding that the use by a debt collector of the Model Form validation notice under Regulation F does not guarantee compliance with the requirements of 15 U.S.C. § 1692g or other sections of the FDCPA. Keep reading.

Massachusetts Federal Court Dismisses Borrower’s RESPA Claim After Borrower Fails to Plead Actual or Statutory Damages

In April 2024, the United States District Court for the District of Massachusetts held in a matter of first impression that a borrower must allege actual damages to qualify for relief under the Real Estate Settlement Procedures Act.  Keep reading.

New York District Court: Legal Fees Sufficient for Standing in FDCPA Claims

On May 20, 2024, the United States District Court for the Southern District of New York issued a decision holding that legal fees resulting from violations of the Fair Debt Collection Practices Act constitute a cognizable monetary harm for the purpose of establishing constitutional standing. Keep reading.

Ohio Appeals Court Finds Error in Not Staying Discovery Pending Motion to Compel Arbitration

The Ohio Eighth Appellate District found that a trial court erred by refusing to stay discovery pending a ruling on a motion to compel arbitration. In so ruling, the court first found that the FAA, and not Ohio’s Arbitration Act, governed because the issues arose out of employment agreements that relate to interstate commerce. Keep reading.

Alabama Supreme Court Decision: Former Mortgagees are Necessary and Indispensable Parties in Ejectment Action with Wrongful Foreclosure Counterclaims

In April 2024, the Alabama Supreme Court issued an opinion that significantly expands the application of Rule 19 of the Alabama Rules of Civil Procedure to post-foreclosure proceedings when it held that former mortgagees are necessary and indispensable parties in wrongful foreclosure actions. Keep reading.

FDUTPA Dismissal: Implications for Non-Consumer Plaintiffs

On April 4, 2024, the Middle District of Florida dismissed a non-consumer plaintiff’s Florida Deceptive and Unfair Trade Practices Act (FDUTPA) claim for failure to plead injury to consumers. This ruling underscores the stringent requirements for non-consumer plaintiffs under the FDUTPA and highlights the challenges of navigating consumer protection laws in cases of alleged unfair competition. Keep reading.

JAMS Announces New Mass Arbitration Rules and Procedures

Following in the footsteps of the American Arbitration Association, JAMS recently announced the creation of its own mass arbitration procedures and guidelines, designed, in part, “to facilitate the fair, expeditious, and efficient resolution of mass arbitrations.”  Keep reading.

Threshold Arbitrability Questions: SCOTUS Rules that Courts, Not Arbitrators, Must Decide Which Contract Governs

On May 23, 2024, the Supreme Court unanimously ruled that when parties have agreed to more than one contract – one that contains a clause sending threshold arbitrability questions to an arbitrator and one that sends those disputes to a court – a court must decide which contract governs. Keep reading.

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District Court Dismisses FDCPA and TILA Claims Against Mortgage Servicer

November 20, 2024

On November 14, 2024, the United States Court for the District of Arizona dismissed a pro se litigant’s claims against Sun West Mortgage Company, Inc. (Sun West) and Cody N. Crosier, foreclosure counsel for Sun West (collectively, Defendants) for, inter alia, alleged violations of the Fair Debt Collections Practice Act (FDCPA), 15 U.S.C. § 1692 and the Truth in Lending Act (TILA), 15 U.S.C. § 1640(k). The court ruled that a third party could foreclose on a property after the original lender sold its interest in the promissory note and deed of trust associated with the property.

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Litigation Byte (October Edition)

October 31, 2024

Delivered in digestible, insightful bites, McGlinchey’s Litigation Byte is a monthly roundup of financial services decisions and cases nationwide that impact your business.

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Let SCOTUS Decide: Can an Amended Complaint ‘Remove’ Removal Jurisdiction?

October 25, 2024

On October 7, 2024, the Supreme Court heard arguments to answer two longstanding questions on removal jurisdiction: (1) Whether amending a complaint to eliminate the only federal questions destroys federal subject-matter jurisdiction under 28 U.S.C. § 1331 and (2) whether a post-removal amended complaint precludes a district court from exercising supplemental jurisdiction over state law claims under 28 U.S.C. § 1367.

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FCRA Claims Fail as Mortgagor Could Not Satisfy His Repayment Obligations by Tendering Another Promise to Pay

October 16, 2024

On September 19, 2024, the District Court for the Eastern District of New York dismissed claims against the mortgage lender, its mortgage servicer, and credit reporting agencies under the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq., New York Uniform Commercial Code § 9-210 et seq., and common law defamation for lack of standing because plaintiff’s self-inflicted injury was a result of his personal choices rather than defendant’s conduct.

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Supreme Court to Hear TCPA Class Action on Unsolicited Faxes and Online Fax Services

October 9, 2024

For the second time in five years, the U.S. Supreme Court will decide a case that arises out of the Telephone Consumer Protection Act’s (TCPA) ban on the sending of unsolicited faxes. On Friday, October 3, 2024, the Court said it would hear arguments about whether to reopen a class action lawsuit filed by a group of chiropractors, McLaughlin Chiropractic Associates, against medical tech company McKesson Corp.

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Separate Actions Against a Residential Tenant in Different Courts Could Constitute Abusive Collection Practices Under the FDCPA

October 9, 2024

On September 30, 2024, the District Court for the Eastern District of New York denied dismissal of plaintiff-tenant’s claim against her landlord’s counsel for abusive collection practices in violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692f, finding that the commencement of more than one suit against the same consumer in different courts could potentially violate the FDCPA prohibition on abusive acts or practices.

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4th Circuit Holds Rental Applicant Lacks Standing to Bring FCRA Claims Over Inaccurate OFAC Reporting

October 1, 2024

On September 11, 2024, the 4th Circuit held that a named plaintiff in a putative class action failed to establish a concrete injury that could satisfy the injury-in-fact requirement for Article III standing against consumer reporting agency, RentGrow, Inc. Plaintiff alleged that Defendant inaccurately reported on rental applications that Plaintiffs were on the Office of Foreign Assets Control’s (OFAC) list of individuals who threaten America’s national security. However, the 4th Circuit held that Plaintiff had no Article III standing when the undisputed evidence suggested that the inaccurate OFAC reports were never reviewed by a third party, and therefore, no concrete injury could be established.

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Litigation Byte (September Edition)

September 26, 2024

Delivered in digestible, insightful bites, McGlinchey’s Litigation Byte is a monthly roundup of financial services decisions and cases nationwide that impact your business.

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Eighth Circuit Upholds Sanctions Against Defendant in FCRA Lawsuit for Demanding “Too Much” in Discovery

September 25, 2024

Recently, the U.S. Circuit Court of Appeals for the Eighth Circuit affirmed a discovery ruling, including an award of $93,243.50 in attorneys’ fees, against a defendant in a lawsuit arising under the Fair Credit Reporting Act (FCRA). The court found that the defendant “crossed the line when it demanded mostly irrelevant information” from the consumer’s law firm.

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Lack of Actual Knowledge and Prior Express Consent Defeats FDCPA and TCPA Claims

September 24, 2024

The U.S. District Court for the District of Nevada granted a defendant’s motion for summary judgment in a case arising under the Fair Debt Collection Practices Act (FDCPA) and the Telephone Consumer Protection Act (TCPA). It found that the evidence did not reasonably support an inference that the defendant had actual knowledge of the plaintiff’s legal representation regarding an account and that the plaintiff providing her phone number regarding the original transaction is consent to communications originating from that transaction, including efforts to collect on the debt.

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Court Finds Mass Arbitration Bellwether and Delegation Provisions Unconscionable

September 20, 2024

The district court for the Northern District of California recently denied a defendant's motion to compel arbitration and, in so ruling, found that a bellwether provision related to mass arbitrations was unconscionable. Avia involved various statutory claims challenging an online gaming company’s representations regarding gameplay. In response, the gaming company moved to compel arbitration. The plaintiff argued, among other things, that the arbitration agreement, and specifically, the bellwether provision, were unconscionable.

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Litigation Byte (August Edition)

August 29, 2024

The Litigation Byte is the new name and format for McGlinchey's Commercial Law Bulletin. Our new format reflects McGlinchey’s national coverage and our expanded footprint while still serving up the digestible, insightful bites readers have come to expect, with timely coverage of financial services decisions and cases that impact you and your business.

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Ohio Supreme Court Holds that Defamation Claim is Subject to Discovery Rule

August 26, 2024

In a hotly contested decision, a plurality of the Ohio Supreme Court held for the first time that a claim for defamation is subject to the discovery rule, greatly expanding the potential for businesses and individuals to find themselves subject to a defamation lawsuit in the Buckeye state.

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FCRA Action Dismissed for Lack of Standing and Failure to State a Claim

August 22, 2024

In July 2024, the United States Court for the District of Massachusetts dismissed a pro se litigant’s claims against Experian Information Services LLC (Experian), TransUnion LLC (TransUnion), and Equifax Information Solutions, Inc. (Equifax) (collectively, Credit Reporting Agencies) for alleged violations of the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681 et seq.

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The Court Sua Sponte Retroactively Applies FAPA to Dismiss Foreclosure

August 21, 2024

On July 31, 2024, the New York Supreme Court, Appellate Division: Second Department reversed the trial court’s denial of borrowers’ motion to dismiss a foreclosure action filed prior to the enactment of the Foreclosure Abuse Prevention Act (FAPA) because under the new “savings statute” for foreclosure actions under FAPA, plaintiff was precluded from recommencement since the first foreclosure was dismissed as abandoned under CPLR § 3215(c).

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Vexatious Litigant Laws Clarified by Texas Supreme Court

August 15, 2024

The recent decision in Serafine v. Crump by the Supreme Court of Texas primarily revolves around the interpretation of what constitutes "litigation" under Texas law, particularly in the context of determining whether someone is a "vexatious litigant." This case settled a growing inconsistency within some courts of appeals. 

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Under FAPA: Dismissal of Prior Foreclosure for Lack of Standing Does Not Estop Lender

August 9, 2024

On July 31, 2024, the New York Supreme Court, Appellate Division: Second Department affirmed the dismissal of a quiet title action, which sought to discharge a mortgage as time-barred under the Foreclosure Abuse Prevention Act (FAPA), because the prior foreclosure was dismissed upon the court’s finding that plaintiff lacked standing.

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Litigation Byte (July Edition)

August 2, 2024

The Litigation Byte is the new name and format for McGlinchey's Commercial Law Bulletin. Our new format reflects McGlinchey’s national coverage and our expanded footprint while still serving up the digestible, insightful bites readers have come to expect, with timely coverage of financial services decisions and cases that impact you and your business.

Alert

FDCPA Claim: District Court Grants Summary Judgment in Favor of Creditor

July 15, 2024

On June 14, 2024, in Smitherman v. Midland Credit Mgmt. Inc., the United States District Court for the Western Division of Missouri granted summary judgment for a creditor on a plaintiff’s claim under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 et seq., finding that the Plaintiff lacked standing to assert her claim and ruling that the creditor’s alleged conduct did not violate the FDCPA.

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This is the End … of Chevron Deference. What Does It Mean and What Comes Next?

July 1, 2024

In a maximalist decision that went further than even the most ardent opponents of Chevron deference thought possible, the Supreme Court finally and emphatically overruled Chevron deference, the watershed rule that governed the level of deference afforded to administrative agency interpretation of ambiguous statutes for nearly forty years.

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Litigation Byte (June Edition)

June 27, 2024

The Litigation Byte is the new name and format for McGlinchey's Commercial Law Bulletin. Our new format reflects McGlinchey’s national coverage and our expanded footprint while still serving up the digestible, insightful bites readers have come to expect, with timely coverage of financial services decisions and cases that impact you and your business.

Commercial Litigation Alert

Massachusetts Federal Court Dismisses Borrower’s RESPA Claim After Borrower Fails to Plead Actual or Statutory Damages

May 30, 2024

In April 2024, the United States District Court for the District of Massachusetts held in a matter of first impression that a borrower must allege actual damages to qualify for relief under the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2601 et seq. Specifically, the borrower must allege actual damages before arguing statutory damages under 26 U.S.C. § 2605(f)(1)(B)’s “pattern and practice” language.

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NY District Court: Legal Fees Are Sufficient for Standing in FDCPA Claims

May 30, 2024

n May 20, 2024, the United States District Court for the Southern District of New York issued a decision holding that legal fees resulting from violations of the Fair Debt Collection Practices Act (FDCPA) constitute a cognizable monetary harm for the purpose of establishing constitutional standing.

Alert

JAMS Announces New Mass Arbitration Rules and Procedures

May 17, 2024

Following in the footsteps of the American Arbitration Association (AAA), JAMS recently announced the creation of its own mass arbitration procedures and guidelines, designed, in part, “to facilitate the fair, expeditious, and efficient resolution of mass arbitrations.” 

Alert

NJ District Court Underscores Limits of “Safe Harbor” Protection Under Regulation F

May 17, 2024

On May 7, 2024, the United States District Court for the District of New Jersey issued a decision holding that the use by a debt collector of the Model Form validation notice under Regulation F does not guarantee compliance with the requirements of 15 U.S.C. § 1692g or other sections of the Fair Debt Collection Practices Act (FDCPA).[1] Consequently, the court joined “several other district courts in finding that compliance with Regulation F and the CFPB's Model Form in and of itself does not provide a ‘safe harbor’ from all alleged violations of the FDCPA.”  

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FDUTPA Dismissal: Implications for Non-Consumer Plaintiffs

May 14, 2024

On April 4, 2024, the Middle District of Florida dismissed a non-consumer plaintiff’s Florida Deceptive and Unfair Trade Practices Act (FDUTPA) claim for failure to plead injury to consumers. This ruling underscores the stringent requirements for non-consumer plaintiffs under the FDUTPA, highlighting the challenges of navigating consumer protection laws in cases of alleged unfair competition.