Category Archives: Consumer Protection

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Supreme Court Sides With Balch Lawyers and Finds for Midland Funding, Rejecting FDCPA Lawsuits Based on Bankruptcy Proofs of Claim for Out-of-Statute Debts

This week, the United States Supreme Court issued a key decision under the Fair Debt Collection Practices Act in a case litigated by Balch & Bingham lawyers, Jason Tompkins and Chase Espy. In Midland Funding, LLC v. Johnson, the Supreme Court resolved a circuit split over the issue of whether debt collectors who file bankruptcy … Continue Reading

Eleventh Circuit Declines to Expand Reach of “Least Sophisticated Consumer” Standard In the Context of Sending Periodic Mortgage Statements Following Bankruptcy Discharge

The Eleventh Circuit recently clarified that sending periodic mortgage statements following a debtor’s bankruptcy discharge is not misleading to the “least sophisticated consumer.” In Helman v. Bank of America, 15-13672, 2017 WL 1350728 (11th Cir. April 12, 2017) Gayle Helman filed suit, alleging that Bank of America violated the Fair Debt Collections Practices Act (FDCPA), … Continue Reading

Eleventh Circuit accepts Spokeo argument; holds that mere procedural violation is not enough to confer standing

In a victory for defendants, the Eleventh Circuit recently agreed that a mere procedural violation—the kind of injury that has become the favorite of the plaintiffs’ bar—is insufficient to confer Article III standing. More specifically, the Eleventh Circuit concluded that a certified return receipt will satisfy a lender’s obligation under Regulation X to provide written … Continue Reading

FDCPA’s “Least Sophisticated Consumer” May Still Have Commonsense

Late December, the Fourth Circuit Court of Appeals (Fourth Circuit), in Lovegrove v. Ocwen Home Loans Srvs., upheld summary judgment in favor of a mortgage servicer against allegations under the Fair Debt Collection Practices Act (FDCPA), under which courts generally apply a “least sophisticated consumer” standard. The plaintiff in Lovegrove alleged that monthly mortgage statements … Continue Reading

Alabama Court of Civil Appeals Holds Questions Regarding Propriety of Foreclosure May Be Raised as Affirmative Defense to Ejectment Even If Foreclosure Occurred More Than One Year Prior to Ejectment Action

The Alabama Court of Civil Appeals recently held in Pittman v. Regions Bank that questions about the propriety of a foreclosure may be raised more than one year after the foreclosure as an affirmative defense to an ejectment action, even if that party did not challenge the original foreclosure. In 2008, Windham and Rhonda Pittman—along … Continue Reading

Eleventh Circuit Holds That Reg. X Does Not Require Mortgage Servicers to Evaluate Untimely Loan Modification Plans Even If the Foreclosure Is Rescheduled So That the Sale Actually Occurs Beyond Reg. X’s 37-day Window

In a recent decision, the Eleventh Circuit (Lage v. Ocwen Loan Servicing, LLC, No. 15-15558 (11th Cir. Oct. 7, 2016)) held that a loan servicer is not required to evaluate a completed loan modification application if that application is submitted less than 37 days before a foreclosure sale is originally scheduled to occur. The Court … Continue Reading

Eleventh Circuit: Failure to provide debtor with FDCPA-required disclosures constitutes injury-in-fact to confer standing

In an unpublished opinion, the Eleventh Circuit applied the Supreme Court’s recent opinion in Spokeo, Inc. v. Robins, 578 U.S. ___, 136 S. Ct. 1540 (2016) and held that a debtor who allegedly did not receive certain disclosures required by the Fair Debt Collections Practices Act (FDCPA) suffered an injury-in-fact to her statutorily created right … Continue Reading

Against the Grain: Bankruptcy court allows FDCPA claim to proceed despite res judicata argument

Few issues involving the Fair Debt Collection Practices Act (FDCPA) are more hotly contested than whether filing a proof of claim on a time-barred debt violates the FDCPA. In bankruptcy, creditors have a right to file proofs of claim outlining the debt owed to them by the bankrupt debtor. In some instances, the statute of … Continue Reading

CFPB Employs “Mystery Shoppers” to Investigate Allegations of Discrimination

With the Consumer Financial Protection Bureau (“CFPB”) now employing mystery shoppers, financial institutions must ensure that their branches are actually putting non-decimation policies into practice.  As we reported here on July 1, BancorpSouth, a Mississippi-based bank, recently entered into a $10.6M settlement with the CFPB regarding alleged redlining in the Memphis market.  That investigation was the … Continue Reading

CFPB Announces $10.6M Settlement with Mississippi Bank over Redlining

In a case that demonstrates the scope of the Consumer Financial Protection Bureau’s (“CFPB’s”) reach, the CFPB and Department of Justice (“DOJ”) have entered into a settlement with BancorpSouth totaling almost $10,600,000 over alleged redlining.  Redlining is the practice of denying services or raising prices to residents of certain geographic areas based upon their racial … Continue Reading

Balch attorneys provide guidance on TCPA compliance

Balch recently authored an article for Law 360 regarding the conundrum the Telephone Consumer Protection Act poses for electric utilities. While their article does not involve the financial industry, it does shed insight on the many problems created by the TCPA. For example, electric utilities are often required by state law to call customers before … Continue Reading

CFPB Files Enforcement Action Against Mississippi Payday Lender

The CFPB is showing that its enforcement actions are not limited to larger companies and that it will file actions in federal courts across the country.  On May 11, 2016, it filed an enforcement action against Mississippi payday lender All American Check Cashing in the United States District Court for the Southern District of Mississippi.  … Continue Reading

Eleventh Circuit holds that debt collection letters sent to a consumer’s attorney qualifies as a communication with a consumer under the Fair Debt Collection Practices Act.

Following the Eleventh Circuit’s decision in Bishop v. Ross Earle & Bonan, P.A., No. 15-12585, creditors and debt collectors should immediately review their practices to ensure that any communication to a debtor or a debtor’s attorney complies with the Fair Debt Collection Practices Act (FDCPA). This is especially true for FDCPA § 1692g(a)’s requirement that … Continue Reading

Eleventh Circuit Affirms Jury Verdict Against Mortgage Servicer for Extreme and Outrageous Conduct

Following the Eleventh Circuit’s decision last month in McGinnis v. American Home Mortgage Servicing, Inc., No. 14-13404, mortgage servicers should be aware that failing to recognize and correct miscalculations of a borrower’s payment may subject them to liability for extreme and outrageous conduct in certain circumstances. American Home Mortgage Servicing, Inc. took over the servicing … Continue Reading

The Eleventh Circuit still stands alone, as Balch attorneys defend the dismissal of Crawford claims in federal appellate courts across the country

From the moment it was published in July 2014, Crawford v. LVNV Funding, LLC, 758 F.3d 1254 (11th Cir. 2014)—the first reported appellate decision holding that a plaintiff may state a claim under the Fair Debt Collection Practices Act based on a creditor’s bankruptcy proof of claim for an out-of-statute debt—spawned a flurry of litigation … Continue Reading

Florida Court Holds Offer of Judgment Statute is Preempted in Actions under the Florida Consumer Collection Practices Act (FCCPA)

A Hillsborough County Court recently held that Florida’s offer of judgment statute, Fla. Stat. § 768.79, is preempted by the Florida Consumer Collection Practices Act (the “FCCPA”), Fla. Stat. § 559.72.  This decision and, others like it, have stripped defendants in lender liability suits of valuable settlement tools.  In May 2013, the plaintiff in Hall … Continue Reading

SD Fla Confirms Communications Sent Only to Debtor’s Counsel Not Actionable Under FDCPA

In Maignan v. Seterus, Inc., No. 14-CV-22488 (S.D. Fla. Feb. 11, 2015), the United States District Court for the Southern District of Florida found that an allegedly deceptive communication to a plaintiff’s attorney, as opposed to the plaintiff himself, is not actionable under either the federal Fair Debt Collection Practices Act (FDCPA) or its state … Continue Reading

Rule 68 Offers of Judgment Providing Full Statutory Damages Cannot Render a Complaint Moot or Defeat a Putative Class

In Walker v. Financial Recovery Services, Inc., No. 14-13769 (11th Cir. March 27, 2015), the court addressed the impact of an offer of judgment under Federal Rule of Civil Procedure 68 on both a putative class and its named representative’s complaint. In the district court below, Financial Recovery Services, Inc. (“FRS”)  successfully dismissed Walker’s complaint … Continue Reading

Eleventh Circuit holds that a credit reporting agency can be held liable for emotional distress damages even though it never communicated erroneous credit information to a third party

In Collins v. Experian Information Solutions, Inc., No. 14-11111 (11th Cir. January 5, 2015), the plaintiff sought to recover damages for emotional distress resulting from a credit reporting agency’s failure to reasonably investigate disputed information in his credit file.  Prior to the lawsuit before the court, Equable Ascent Financial, LLC sued Curtis Collins in small … Continue Reading

The Georgia Supreme Court holds that a contract disclaimer in all capitalized, fine print, is not “conspicuous and prominent”

In Raysoni v. Payless Auto Deals, LLC, et al., No. S13G1826 (Ga., November 17, 2014), a purchaser of a used vehicle alleged that Payless Auto Deals, LLC (“Payless”) and its salesman orally misrepresented that the vehicle had not been in an accident, when, in fact, it had previously sustained significant frame damage.  Before purchasing the … Continue Reading

Court Clarifies Statute of Limitations in TILA Actions Involving Missing Disclosures, Rejects Equitable Tolling in Such Cases

A recent decision by the Eleventh Circuit Court of Appeals holds that the statute of limitations for a missing disclosure claim under the Truth-In-Lending Act (“TILA”), 15 U.S.C. §1601, et seq., begins to run on the date the lender distributed its loan application to the prospective borrower.  Further, in holding that the borrower “knew or … Continue Reading

CFPB Signals Debt Purchaser Industry In Its Sights With New Lawsuit Against Georgia Law Firm

On July 14th, the Consumer Financial Protection Bureau filed suit against a debt collection law firm in federal district court in Atlanta, alleging in broad strokes that its practices— including some which are fairly common in the debt purchaser industry– systematically violate the Fair Debt Collection Practices Act (“FDCPA”) and the Consumer Financial Protection Act … Continue Reading

11th Circuit Holds that Filing Proof of Claim for Time-Barred Debt in Bankruptcy Court Violates the FDCPA

In recent years, there has been a growing consensus among the courts that a debt collector’s threat to file suit on a debt otherwise barred by the applicable state statute of limitations violates the Fair Debt Collection Practices Act (“FDCPA”), 15 U.S.C. §§1692-1692p (2006). Now that consensus has been extended to proofs of claim in … Continue Reading

CFPB Fines Alabama Real Estate Agency for Failing to Properly Disclose Its Affiliate Relationship with Title Company under RESPA Section 8(c)(4).

A May 28, 2014 consent order against an Alabama company serves as a warning to the residential real estate industry to be careful about properly disclosing its affiliate relationships with closing service providers. In March, the Consumer Financial Protection Bureau (“CFPB”) brought an administrative proceeding against JRHBW Realty, Inc., which does business as RealtySouth, and … Continue Reading
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