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Missouri Supreme Court Upholds Non-Economic Damages Cap

On July 22, 2021, the Missouri Supreme Court issued its opinion in the matter of Ordinalo Velazquez v. University Physician Associates, et al. In a victory for health care providers, the Missouri Supreme Court rejected a constitutional challenge to non-economic damages caps in actions based on the provision of medical services.

United States Supreme Court Holds That Plaintiffs Must Suffer Concrete Harm to Sue in Federal Court

As part of the flurry of its end-of-term opinions, the U.S. Supreme Court recently issued its opinion in TransUnion LLC v. Ramirez, 594 U.S. ____ (2021) confirming that plaintiffs who have suffered no concrete harm have no standing to sue in federal court under Article III of the U.S. Constitution.  As Justice Kavanaugh succinctly put it in writing for the five justice majority, “No concrete harm, no standing.”

Did my Client Just Waive Privilege?!

For any attorney, whether new or seasoned, this can be a terrifying possibility. Privilege waivers can happen at any time and can have devastating consequences for your client’s case. This possibility is made even more precarious when one considers that jurisdictions have varying guidelines when it comes to what constitutes a waiver.

The Anatomy of Lost Profits Claims in Franchise Cases

Originally Published in Franchise Law Journal

Claims seeking the recovery of lost profits are becoming increasingly more common in franchise litigation, particularly after franchise termination.  Because both the franchisor and the franchisee enter into the relationship with the expectation of profit, a termination frustrates both sides’ expectations and the economic rationale for entering the relationship in the first place.  Although historically franchisees were more likely to assert these claims in reaction to terminations, more recently franchisors have also pursued such claims when franchisees leave the relationship before the end of the contract term.  This article provides a brief history of the law governing claims for lost profits, outlines selected issues facing litigants under the current slaw, and concludes by offering some opinions about best practices for litigants relating to lost profits, particularly in the franchise context.

The Eleventh Circuit Calls Into Question the use of Letter Vendors as Violative of the FDCPA

The Eleventh Circuit in Hunstein v. Preferred Collection and Management Services, Inc. issued an opinion yesterday that confronted an issue of first impression, namely, whether a debt collector can use a third party vendor to send collection letters without violating the Fair Debt Collection Practices Act (“FDCPA”).  The facts were simple.  The defendant/debt collector used a third party letter vendor to send an initial “dunning” letter to the plaintiff/consumer.  In doing so, the defendant provided the vendor with the plaintiff’s name, his outstanding balance, the fact that his debt resulted from his son’s medical treatment, and his son’s name.  The plaintiff filed a lawsuit alleging that the defendant violated the FDCPA by disclosing his personal information to the third-party vendor.

The Third Circuit Explains That the ‘Least Sophisticated Consumer’ is Presumed to Have a Willingness to Read Collection Letters With Care

In the recent Third Circuit opinion rendered in Moyer v. Patenaude & Felix, A.P.C., the plaintiff brought a putative class action alleging that Patenaude & Felix violated the Fair Debt Collection Practices Act (“FDCPA”) by sending her a single collection letter. The letter advised the plaintiff that her debt had been assigned to the firm and stated: “If you wish to eliminate further collection action, please contact us at 800-832-7675 ext. 8500.”  The letter then went on to advise the plaintiff of her validation rights under §1692g.  Resolution of the alleged class action claims required the Third Circuit to decide whether the inclusion of the single sentence inviting a call would confuse the least sophisticated consumer.

The Minnesota Supreme Court Determines Retailer Cannot Claim a Sales Tax Offset Based on Uncollectible Debts

The Minnesota Supreme Court recently ruled that a large home improvement retailer cannot claim a sales tax offset based on uncollectible debts from purchases made on its private label credit card, in the case Menard, Inc. v. Commissioner of Revenue, case number A20-0241. The home improvement retailer, attempted to offset its sales tax liability pursuant to Minnesota Statues § 297A.81, subd. 1 that allows a taxpayer to offset against its current sales tax liability taxes “previously paid as a result of any transaction the consideration for which became a debt owed to the taxpayer that became uncollectible during the reporting period.”

After CFPB Refuses to Change FDCPA’s Strict Liability, Ninth Circuit Permits Bona Fide Error Defense for Statute of Limitations Mistake

The Consumer Financial Protection Bureau (CFPB) recently considered eliminating strict liability for one category of claims under the Fair Debt Collection Practices Act (FDCPA): claims asserting that a debt collector brought or threatened to bring legal action to collect a time-barred debt. The proposed revision to Regulation F would have required consumers to show that a debt collector knew or should have known the debt was outside the statute of limitations. Advocates for the change argued that strict liability was inappropriate because a debt collector can reach the wrong conclusion about a state’s application of the statute of limitations even after a thorough investigation and a consumer can raise the issue as an affirmative defense if he/she disagrees with the collector’s conclusion.  Debt Collection Practices (Regulation F), 86 FR 5766-01 (Jan. 19, 2021).

Confusion and Anxiety Fail to Satisfy a Plaintiff’s Burden Under the Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act (“FDCPA”) was enacted in 1977 to eliminate abusive debt collection practices.  15 U.S.C. § 1692(e).  To further that goal, section 1692e of the FDCPA prohibits a debt collector from using false, deceptive, and misleading representations; section 1692f prohibits a debt collector from using unfair or unconscionable means; and, section 1692g requires a debt collector to provide certain information (the amount of the debt, name of creditor, and explanation of right to dispute a debt) to a consumer.

In Between a Rock and a Hard Place

Condemning Property When in the Process Of Obtaining Development Approvals

Typically, special districts in Colorado are required by local municipalities to construct various improvements in order to move forward to develop property.  These requirements can be imposed before, during, and after certain development approvals are obtained.  Special districts can find themselves in between a proverbial rock and a hard place when seeking to move forward with condemnation to construct improvements before having formal approval to move forward with the larger development.

Since When do Attorneys Have to Pay the Opposing Counsel Fees?!

Attorneys can be Held Responsible for Opposing Legal Fees if Discovery Rules are Neglected

This may be a question that has never crossed your mind. If so, then good for you. It means you’ve likely never been faced with sanctions. However, just because you haven’t, doesn’t mean you shouldn’t be aware of the possibility.

7th Circuit Issues 5 Rulings Clarifying Standing Under Fair Debt Collection Practices Act

Setting up the potential for the U.S. Supreme Court to confirm and strengthen its 2016 opinion in Spokeo v. Robins, the United States Court of Appeals for the Seventh Circuit issued a raft of five rulings this week that clarify Article III standing issues related to claims under the Fair Debt Collection Practices Act (FDCPA). Through these five opinions, the Seventh Circuit has unequivocally aligned itself with the Eleventh and D.C. Circuits in requiring a plaintiff to plead and provide “competent proof” of a concrete injury in fact to establish Article III standing.  What follows is a brief analysis of each opinion as it relates to a plaintiff’s burden to survive a motion to dismiss for lack of standing.

Filing for Spoliation Sanctions – Is it always worth it?

A recent order out of the District of Colorado provides a cautionary tale when it comes to filing motions requesting sanctions in response to alleged spoliation claims. It may not always be in your client’s best interests.

Court May Exercise “Related To” Jurisdiction Over Adversary Complaint By A Creditor Against a Third Party

Eighth Circuit Bankruptcy Monitor

Court May Exercise “Related To” Jurisdiction Over Adversary Complaint by a Creditor Against a Third Party; Orders Transfer of Action to State Court Although Action Originally Filed in Federal Court

In Bushman Custom Farming, LLC v. Stillmunkes (In re Stillmunkes), Bankr. N.D. Iowa, 19-01011, d/e 16, April 30, 2020, Judge Thad Collins found the Court had “related to” subject matter jurisdiction under 28 U.S.C. § 157(b)(3) to entertain a non-core adversary proceeding between a creditor and a third party. The Court elected to abstain and ordered the action transferred to an Iowa state court.

Chapter 12 Debtor May Require Turnover of Withheld Pre-Petition Taxes Despite Section 553(a)

EIGHTH CIRCUIT BANKRUPTCY MONITOR

Judge Thad Collins of Bankr. N.D. Iowa held, as a matter of first impression, that “§ 1232(a) allows family farmers who have capital gains tax debt under Chapter 12 process to require taxing entities to issue a refund of withheld income taxes to the bankruptcy estate.”

Proposal to Repeal Colorado’s Taxpayer Bill of Rights (“TABOR”) Heading to the Ballot in November 2020

The Second Trip to the Colorado Supreme Court

No other state has a provision in its constitution like the Colorado Taxpayer Bill of Rights (“TABOR”).  The TABOR measure amended Article X of the state’s constitution and restricts tax revenues and spending at all levels of government.  The provision prevents tax increases without voter approval and prohibits state and local government from spending revenues collected under existing tax rates without voter approval if revenues grow faster that the rate of inflation and population growth.  Tax revenues in excess of the TABOR limit must be refunded to taxpayers.  The impact of the provision has been significant.  Since 1992, tax authorities have refunded over $2 billion to the taxpayers.

Takings Claims in Federal Court

Affected by a local government just compensation action? Your remedies have now changed significantly. The Supreme Court on June 21, 2019 overturned 35 years of precedent. In Knick v. Township of Scott, Pennsylvania the Court held that you can now take your federal takings claims pursuant to 42 U.S.C. § 1983 directly to federal court without exhausting state court remedies.

Another court rules that contractual consent to be called using an ATDS cannot be unilaterally revoked

The Telephone Consumer Protection Act,  47 U.S.C. § 227 (TCPA),  makes it unlawful for any person, absent the “prior express consent of the called party,” to make non-emergency calls using any Automated Telephone Dialing System (ATDS) to any telephone number assigned to a cellular telephone service. Anyone who violates the TCPA may be liable for “actual monetary loss” or $500 in damages for each violation, whichever is greater.

Insurance Benefits – Unreasonable Delay and Denial. Supreme Court of Colorado Decides Three Cases Against Insurance Companies.

In a trio of case opinions issued on May 29, 2018, – all written by Chief Justice Nancy Rice who will retire in June – the Colorado Supreme Court ruled against the arguments of insurance companies. 

Ninth Circuit: Seller is not liable for calls made by telemarketer in violation of the Telephone Consumer Protection Act

In a recent decision that may affect any company that sells products or services using telemarketers, the United States Court of Appeals for the Ninth Circuit affirmed the district court’s grant of summary judgment in Jones v. Royal Admin. Servs., Inc. in favor of a product seller, holding the seller was not vicariously liable for calls made by a telemarketer in violation of the Telephone Consumer Protection Act[1] (TCPA) because the telemarketer was an independent contractor.

Eleventh Circuit: Consumers may “partially revoke” consent to be called by automatic dialing systems

In a new decision that may have important implications for telemarketers and others using automatic dialing systems, the United States Court of Appeals for the Eleventh Circuit held in the case of Schweitzer v. Comenity Bank that the Telephone Consumer Protection Act (TCPA) allows a consumer to partially revoke his or her consent to receive automated telemarketing calls.

The Second Circuit issues potentially impactful ruling on revocation of consent to be called under the Telephone Consumer Protection Act when that consent is given as bargained-for consideration for a binding contract

Congress enacted the Telephone Consumer Protection Act, 47 U.S.C. § 227, et seq., (TCPA) to protect consumers from “[u]nrestricted telemarketing, which it determined to be “an intrusive invasion of privacy.” The TCPA prohibits, among other conduct, telephone calls to residential phone lines or cell phones using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party.

When is a seller liable for illegal calls made by a third party telemarketer? Fleshing out vicarious liability under the Telephone Consumer Protection Act

Using a telemarketer to market goods or services can be extremely costly to the seller if the telemarketer conducts its business in a manner that violates the Telephone Consumer Protection Act (TCPA). Penalties for violations of the TCPA range from $500 to $1,500 per call. And with call or text campaigns that may reach thousands of recipients, or even millions – the potential liability can be astronomical. It should be no surprise TCPA class action lawsuits are flourishing.

Oklahoma – New Law Requires the Losing Party to Pay Attorney Fees

HB 1470, signed into law last week, does away with the “American Rule,” which impacts which party is responsible for attorney fees at the conclusion of a lawsuit. Set to go into effect in November 2017, the new law requires the court to award attorney fees to the prevailing party – paid for by the non-prevailing party.

Federal Court in Missouri holds technical failure to comply with the FCC’s TCPA opt-out notice requirements on fax advertisements does not confer standing on recipient who consented to receive the faxes

The FCC’s TCPA “opt-out” notice requirements for sending solicited faxes continues to be weakened.

A federal district court in Missouri rejects an FDCPA claim based on the legal theory that post-judgment interest in Missouri nontort cases must be specifically awarded in the judgment to be collectable

We are pleased to report a victory in the Eastern District of Missouri in an FDCPA case concerning the collection of statutory post-judgment interest on an unpaid Missouri state court judgment.

Injunctive Relief Summary

This summary covers (i) the types of injunctive relief, and when it is obtained; and (ii) what is necessary to obtain injunctive relief.

A federal district court in California denies class certification to a nationwide putative TCPA class of consumers against a debt collector who allegedly made more than 500 million prohibited calls

The United States District Court for the Southern District of California recently issued an order denying class certification to a nationwide putative class of consumers against The CBE Group, Inc. (“CBE”), which alleged that CBE made over 500 million calls to these consumers’ cell phones without their prior express consent in violation of the Telephone Consumer Protection Act, 47 U.S.C. § 227, et seq. (“TCPA”).  Blair, et al. v. The CBE Group, Inc., No. 3:13-cv-00134-MMA-WVG (S.D. Cal. August 26, 2015).

The Sixth Circuit sheds light on meaning of “prior express consent” under the TCPA in a case involving hundreds of calls to a debtor’s cellphone by a creditor using an autodialer

One thing that telemarketers and other companies that communicate with their customers by calling their customer’s cellphones crave is clarity under the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227.  The Sixth Circuit recently shed some light on the meaning of “prior express consent” under the TCPA in connection with calls by a creditor to its debtor’s cellphone in the case of Hill v. Homeward Residential, Inc., No. 14-4168 (6th Cir. August 21, 2015).

The Eleventh Circuit rules that Capital One is not a debt collector under the FDCPA with respect to defaulted credit card debt it acquired from HSBC

In the case of Davidson v. Capital One Bank (USA), N.A., No. 14-14200 (August 21, 2015), the Eleventh Circuit had occasion to decide whether a bank that collects on defaulted debt it acquired from another bank is a “debt collector” under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692-1692p.

Can a Rule 68 offer of judgment that offers complete relief to the named plaintiff in a putative class action moot the entire case? While federal courts continue to reach different conclusions, the Supreme Court may finally weigh in

One tactic often used with varying degrees of success to thwart putative class actions brought under various federal statutes is to file an early offer of judgment under Rule 68 that provides the named plaintiff or plaintiffs complete relief in an effort to moot the putative class claims at the inception of a class case.

A federal district in Pennsylvania dismisses a putative FDCPA class action based on the filing a proof a claim on a time-barred debt in a Chapter 13 bankruptcy

I recently wrote about a decision from a federal district court in Alabama that sidestepped the Eleventh Circuit’s Crawford decision by finding that the Bankruptcy Code (the “Code”) and the Fair Debt Collection Practices Act (“FDCPA”) were in irreconcilable conflict, and the FDCPA gave way to the Code on the question of whether the mere act of filing a proof of claim on a stale debt in a Chapter 13 bankruptcy violated the FDCPA.

Federal Judge in California brings down the curtain on a FCRA class action against Paramount Pictures

Class actions alleging technical violations of the Fair Credit Reporting Act (FCRA) against employers who obtain consumer reports on job applicants are all the rage, generating large settlements and headlines (at least in legal circles).

The bona fide error defense to FDCPA claims is alive and well in the Eleventh Circuit

In the case of Isaac, et al. v. RMB, Inc., et al., No. 14-11560 (11th Cir. March 17, 2015), the Eleventh Circuit recently upheld summary judgment in favor of a debt collector based on the affirmative defense of bona fide error.  The case presents a good opportunity to see what type of evidence is needed to prevail on the defense.

A federal district court sidesteps Crawford in dismissing claim for FDCPA violation based on filing a proof of claim on a time-barred debt in a Chapter 13 bankruptcy

In a 2014 decision rued by debt collectors everywhere, the Eleventh Circuit in Crawford v. LVNV Funding, LLC, 758 F.3d 1254 (11th Cir. 2014) ruled that filing a proof of claim to collect a time-barred debt in a Chapter 13 bankruptcy violated the Fair Debt Collection Practices Act

Illinois court rules that engineering firm that prepared and recorded plat for new subdivision is not entitled to a mechanic’s lien

An Illinois appellate court recently had an opportunity to decide whether an engineering firm hired to plat undeveloped land for a new subdivision was entitled to file and enforce a mechanic’s lien after the firm was not paid in full for its work.

Home mortgage lenders hire law firm to send 88,937 collection letters to defaulted borrowers: Borrowers allege this violated the FDCPA and a federal judge certifies the class

In Lori Jo Vincent, et al. v. The Money Store, Inc. et al, No. 03 cv 2876 (S.D.N.Y.  February 2, 2015), the United States District Court for the Southern District of New York certified a class of home mortgage borrowers who defaulted on their loans and received uniform “breach letters” from a law firm sent on behalf of the defendant mortgage servicing company and the defendant lenders. 

Is a communication between a debt collector and a credit reporting agency a communication “in connection with the collection of any debt” for purposes of the FDCPA?

In a case in which the Eighth Circuit found against a debtor on her claim against a collection agency based on the FDCPA, the court nevertheless adopted a standard followed by other circuits in defining when a communication is “…in connection with the collection of any debt” for purposes of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692 et seqSarah McIvor v. Credit Control Services, Inc., No. 14-1164 (December 4, 2014).

The Sixth Circuit rules that making an offer to settle a valid but time-barred debt may give rise to an FDCPA violation.

In a case that will likely cause debt collectors seeking to collect time-barred obligations grave concern, the Sixth Circuit recently ruled that making an offer to settle a time-barred debt at a discount could mislead an unsophisticated consumer to believe the debt could be enforced in court in violation of the Fair Debt Collection Practices Act.  Buchanan v. Northland Group, Inc., No. 13-2523 (January 13, 2015).

Loan officer’s statements about lien priority in home mortgage transaction do not give rise to borrower’s claims for breach of fiduciary duty and negligent misrepresentation against lender

The North Carolina Supreme Court recently analyzed whether a loan officer owes a borrower a fiduciary duty in a home mortgage transaction.  Dallaire v. Bank of Am., ___N.C.___, 747 S.E.2d 535 (2013), decided June 12, 2014, No. 51PA13.  Jacques and Fernande Dallaire (“Borrowers”) purchased a home as their primary residence in 1998.  Seven years later they filed Chapter 7 bankruptcy due to unrelated business debts. 

Class certification denied to putative class alleging Quest Diagnostics engaged in consumer fraud by routinely overbilling patients

The Third Circuit recently affirmed denial of certification of a class of patients who alleged that the medical testing company, Quest Diagnostics, Inc., routinely overbilled patients.  See Grandalski, et a. v. Quest Diagnostics, Inc., et al., No. 13-4329 (September 11, 2014).  Quest Diagnostics is the country’s largest provider of medical testing.

Putative class action alleging United Airlines breached its frequent-flyer program is dismissed by the Seventh Circuit

The Seventh Circuit recently affirmed dismissal of a putative class action alleging that a major airline improperly calculated frequent-flyer miles.  In Han v. United Continental Holdings, Inc. et al., No. 13-3871, decided August 11, 2014, the plaintiff, Hongbo Han, filed a putative class action against United Air Lines, Inc. and related entities (“United”) alleging it breached the terms of its frequent-flyer program, called the “MileagePlus Program.”

Manufacturing Custom-made Goods in the United States

Pat and I recently had the opportunity to publish an article with Practical Law, called “Manufacturing Custom-made Goods in the United States.”

Are federal courts committing a FCRA violation when lawyers pay filing fees online?

Fellow federal practitioners, could something most of us do on a regular basis be a money making opportunity we’ve simply overlooked? An enterprising lawyer in the Northern District of Illinois thought so.  Unfortunately, in the case of Bormes v. United States of America, No. 13-1602, (7th Circuit), handed down July 22, 2014, the Seventh Circuit answered in the negative.

Antitrust “market allocation” claims against nation’s two biggest grocery wholesalers survive summary judgment

In In re: Wholesale Grocery Products Antitrust Litigation, No. 13-1297 (May 21, 2014), the Eighth Circuit allowed an antitrust case brought by a small town, family owned grocery store in Iowa, D&G, Inc.,[1] to continue against the nation’s two largest wholesale distributors, SuperValu, Inc. and C&S Wholesale Grocers, Inc., finding disputed facts prevented summary judgment.

Lessor of aircraft denied Michigan use tax exemption because aircraft was not leased to the general public in an arm’s length transaction

In FMG Leasing, LLC v. Dep’t of Treasury, FMG Leasing was a limited liability company formed to hold title to an aircraft. No. 312448, 2014 WL 2931938 (Mich. Ct. App. June 26, 2014) (no reported citation available). FMG leased the aircraft to a concrete company that was one of FMG’s forming partners, and to the company’s president. FMG then sought to take advantage of a statutory exception under Michigan law that permits a lessor of tangible personal property to pay use tax on receipts from the rental of the property, instead of paying a sales or use tax on the full cost of the property at the time of purchase.

Update on rideshare battle in St. Louis: Court issues preliminary injunction against Lyft

I previously wrote about the legal battle in St. Louis brought by Metropolitan Taxicab Commission (“MTC”) against the rideshare app company Lyft in the Circuit Court of the City of St. Louis, Missouri, Case No. 1422-CC0089-01. My comment can be found here.
As I discussed, the court entered a temporary restraining order prohibiting Lyft from operating in St. Louis and St. Louis County. On July 14, 2014, the court again ruled in favor of the MTC, granting a preliminary injunction prohibiting Lyft from operating in the St. Louis area until a final decision is reached on the merits of the case.

Eighth Circuit continues to hold that Missouri’s economic loss doctrine bars negligent misrepresentation claims involving allegedly defective or unsuitable products

Manufacturers and lessors of equipment and other products doing business in Missouri can take heart that the Eighth Circuit has issued its third opinion in the past year applying Missouri’s economic loss doctrine to bar negligent misrepresentation claims in cases involving allegedly defective or unsuitable products. 

Missouri Governor Signs Bill Extending Sales Tax Exemption

Missouri Governor Jay Nixon has now signed a bill extending indefinitely the exemption of aircraft replacement parts from the Missouri sales tax.

“Common Carrier” and “Sale for Resale” Tax Exemptions Denied to Lessor of Aircraft

The Missouri Administrative Hearing Commission has held that a lessor of an aircraft does not qualify for the “common carrier” or the “sale for resale” tax exemptions, even if the lessee of the aircraft would qualify.

Manufacturer’s Corner: Protecting Against the “Efficient Breach”

The Oregon Supreme Court has given us a great platform to discuss what happens when a buyer simply decides that breaching the contract is a better idea than performing.  It’s an important case to consider, both in your capacity as a seller of goods, and in your capacity as a frequent buyer of goods under long-term sales contracts.

Manufacturer’s Corner: Can You Prove the Contents of Your Shipment?

In a happy coincidence of timing, the Eleventh Circuit Court of Appeals recently issued an entertaining opinion addressing the Carmack Amendment, which is a federal law limiting the liability of motor carriers for loss or damage of goods during shipment. The opinion will allow us to continue our discussion of mitigating shipping risks, introduced in the last installment of this column.