On February 11, a federal court in Texas dismissed a putative Fair Credit Reporting Act class action filed by a former patient of health services provider St. Joseph Services Corp. who alleged that the defendant’s failure to guard against a personal data breach violated the FCRA. After reviewing the state of the law regarding standing
CFPB Orders Credit Card Lender to Refund Millions to Consumers and Pay Civil Penalty
Last week, the Consumer Financial Protection Bureau ordered Continental Finance Company LLC, a credit card lender, to refund an estimated $2.7 million to approximately 98,000 consumers. The CFPB found that the company’s subprime credit cards misrepresented certain fees and hit consumers with illegal charges. The order also requires the company to pay a civil penalty
Paris Baguette and DKNY Avoid FACTA Class Actions over Credit Card Receipts
On January 16, 2014, Troutman Sanders secured a victory for client Paris Baguette America, Inc. when District Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York dismissed with prejudice a putative class action alleging that Paris Baguette willfully violated the Fair and Accurate Credit Transaction Act by printing
Verification of Disputed Debt in Response to Credit Reporting Agency Inquiry Does Not Constitute Communication “In Connection with the Collection of Any Debt”
The Eighth Circuit Court of Appeals recently decided a case involving a debt collector that had verified the existence of a debt in response to a consumer reporting agency’s inquiry, even though the debtor had allegedly disputed the debt to the same reporting agency. The Eighth Circuit affirmed the lower court’s ruling that the debtor
Federal Court Rejects Unconscionability Argument in Forcing Debt Collection Arbitration
On January 20, a Missouri federal judge issued an order granting a debt collector’s Motion to Compel Arbitration in an action under the Fair Debt Collection Practices Act. Although such motions are frequently granted, the judge here rejected an argument from the plaintiff that her loan agreement – including its arbitration provision – was entirely
Retailer Hit With Second FCRA Class Action Pertaining to Background Checks
On January 28, Michael’s Stores, Inc. was hit with its second Fair Credit Reporting Act (FCRA) class action lawsuit challenging Michael’s employment background check procedures in as many months. This lawsuit should serve as another reminder to employers to verify their background check procedures comply with both state and federal law.
According to the allegations
Seventh Circuit Hears Class Action Suit Against Neiman Marcus Over Data Breach
On January 23, the Seventh Circuit Court of Appeals heard oral arguments in a class action suit against Neiman Marcus Group LLC over the alleged 2013 hack that compromised the credit card numbers of 350,000 shoppers.
The suit was one of multiple proposed class actions filed after hackers infiltrated Neiman Marcus’ payment security system with
Federal Judge Throws Out Debt Collection Class Action
On January 21, the U.S. District Court for the Eastern District of Pennsylvania struck a class action under the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692 et seq. (“FDCPA”) and the Telephone Consumer Protection Act of 1991, 47 U.S.C. §§ 227 et seq. (“TCPA”). Although the judge allowed the lead plaintiff to pursue
CFPB Issues Bulletin Advising Entities Undergoing Regulatory Exams Not To Share Information With Third Parties Or Withhold Information From the CFPB
On January 28, 2015, the Consumer Financial Protection Bureau issued a bulletin warning financial institutions about entering into agreements with third parties that share or hide information related to regulatory exams, as well as warning entities under investigation about sharing information with third parties.
The bulletin is intended to assist supervised entities in complying with
Coalition Urges New York City to Ban Use of Credit Checks in Hiring
On January 15, the NYC Coalition to Stop Credit Checks in Employment published an open letter to New York City Mayor de Blasio and the City Council, urging them to support legislation banning the use of credit checks in employment decisions. To the extent New York City enacts such a law, it would create