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Noah helps clients in the consumer finance industry navigate national class-action litigation by employing rigorous advocacy skills to pursue client goals.

In Career Counseling, Inc. v. Amerifactors Financial Group, LLC, the U.S. Court of Appeals for the Fourth Circuit upheld a district court’s decision denying class certification in a Telephone Consumer Protection Act (TCPA) case on the basis that the plaintiff failed to satisfy Rule 23’s “implicit further requirement of ascertainability.” The Fourth Circuit also upheld summary judgment against the defendant as to the individual claim finding the defendant was indeed the “sender” of the fax at issue. Each finding is discussed more fully below.

We are pleased to share our annual review of regulatory and legal developments in the consumer financial services industry. With active federal and state legislatures, consumer financial services providers faced a challenging 2023. Courts across the country issued rulings that will have immediate and lasting impacts on the industry. Our team of more than 140 professionals has prepared this concise, yet thorough analysis of the most important issues and trends throughout our industry. We not only examined what happened in 2023, but also what to expect — and how to prepare — for the months ahead.

On October 12, the U.S. District Court for the Northern District of Illinois denied certification of a putative class action asserting that TransUnion violated the Fair Credit Reporting Act (FCRA) and the Missouri Merchandising Practices Act (MMPA) by allegedly misleading consumers about the accuracy and popularity of VantageScore 1.0, TransUnion’s proprietary credit scoring model. The court held that the plaintiff was an inadequate class representative due to his lack of credibility, and the asserted class claims failed both the commonality and predominance prongs of Federal Rule of Civil Procedure (FRCP)23.

On July 24, the California Office of Administrative Law approved the Civil Rights Council’s (the Council) proposed amendment to California’s Employment Regulations Relating to Criminal History, which are set to become effective on October 1, 2023. Among other changes, the amendment modifies the existing regulations regarding employers’ investigation of a job applicant’s criminal history. Notably, the amendment expands the definition of “employer” under those regulations in such a way that could potentially implicate a background screener conducting a background check on behalf of an employer.

The modern “Information Age” has been defined by rapidly increasing interconnectivity and dependence on the internet by consumers and businesses alike. One side effect of these technological advances has been the increasing frequency of cyberattacks and data breaches perpetrated by sophisticated cyber criminals using ever-evolving methods of infiltration. And, as can be expected, along with the increase in data breaches over the past few decades, we have seen the rise of data breach litigation, and in particular, consumer class action litigation against the companies who have been victimized by those data breaches. The Fourth Circuit has seen several high-profile data breach class actions. Such class actions often face difficult uphill battles in proving the necessary elements for class certification, particularly when it comes to defining a theory of harm that can be proven by common evidence across the class. Last month, Judge Gibney of the Richmond Division of the Eastern District of Virginia dismissed one such data breach class action case for a more basic problem: the named plaintiffs could not demonstrate they had suffered any concrete injury sufficient to establish Article III standing at all, let alone damages that could be proven classwide. Holmes v. Elephant Ins. Co., No. 3:22cv487, 2023 WL 4183380 (E.D. Va. June 26, 2023).

In Frazier v. Dovenmuehle Mortgage, Inc., the Seventh Circuit recently issued an opinion affirming summary judgement in favor of the defendant data furnisher in a suit brought by a consumer under § 1681s-2(b) of the Fair Credit Reporting Act (FCRA) requiring data furnishers upon notice of a dispute to “investigate the disputed data” and “correct or verify the information by returning the ACDV form to the credit reporting agency [CRA] with any amended or verified data inserted next to the old data.” The appellate court rejected the consumer’s argument that the information provided by the furnisher on an ACDV response to a CRA was materially misleading, even though the CRA’s inaccurate interpretation of the ACDV response led the CRA to report that the consumer was currently delinquent on a settled debt.

According to a recent report by WebRecon, the month of April saw a significant reduction from the previous month in filings under the Fair Credit Reporting Act (FCRA), Fair Debt Collection Practices Act (FDCPA), and the Telephone Consumer Protection Act (TCPA), as well as a reduction in complaints filed with the Consumer Financial Protection Bureau

Chris Willis, co-chair of the CFS Regulatory Practice, Announces the Publication of the 2022 CFS Year in Review and a Look Ahead

Troutman Pepper’s Consumer Financial Services Practice Group consists of more than 120 attorneys and professionals nationwide, who bring extensive experience in litigation, regulatory enforcement, and compliance. Our trial attorneys have litigated thousands of individual and class-action lawsuits involving cutting-edge issues across the country, and our regulatory and compliance attorneys have handled numerous 50-state investigations and nationwide compliance analyses.

We are pleased to share our annual review of regulatory and legal developments in the consumer financial services industry. Our team has prepared this organized and thorough analysis of the most important issues and trends throughout our industry. We not only examined what happened in 2022, but also what to expect — and how to prepare — for the months ahead.