Justia Government & Administrative Law Opinion Summaries

Articles Posted in Consumer Law
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SmartEnergy Holdings, LLC, a retail electricity supplier, was found to have violated various provisions of Maryland law governing retail electricity suppliers, including engaging in deceptive, misleading, and unfair trade practices. The Supreme Court of Maryland upheld the decisions of lower courts and the Maryland Public Service Commission, affirming that the Commission has the authority to determine whether electricity suppliers under its jurisdiction have violated Maryland’s consumer protection laws, including the Maryland Telephone Solicitations Act (MTSA). The court also determined that the MTSA applies to SmartEnergy’s business practices, as it applies to sales made over the telephone where the consumer places the telephone call to the merchant in response to a merchant’s marketing materials. The court found substantial evidence in the record to support the Commission's factual findings and determined that the remedies imposed by the Commission were within its discretion and not arbitrary or capricious. View "In the Matter of SmartEnergy" on Justia Law

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This case pertains to the enforcement of the California Privacy Rights Act of 2020 (the Act), a voter-enacted statute that expanded and amended the California Consumer Privacy Act of 2018. The California Privacy Protection Agency (the Agency) failed to adopt final regulations by the July 1, 2022 deadline set out in the Act. The California Chamber of Commerce sought a court order to delay enforcement of the Act until one year after the agency adopted all required regulations. The trial court granted the petition in part, ruling that the Agency could not enforce any regulation until one year after that regulation became final. The Agency appealed, arguing that the Act did not mandate a one-year delay between the approval of a final regulation and its enforcement. The appellate court agreed with the Agency, finding that the Act's language did not unambiguously require a one-year delay between approval and enforcement. The court ordered a new trial court order denying the Chamber's petition and allowing the trial court to consider any remaining issues regarding the prompt development of regulations. View "California Privacy Protection Agency v. Superior Court" on Justia Law

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A consumer, Reginald Kirtz, secured a loan from the Rural Housing Service, part of the U.S. Department of Agriculture. Although Kirtz repaid his loan by mid-2018, the USDA continued to tell credit report company TransUnion that his account was past due, harming his credit score. The USDA failed to correct its records after being notified of the error, and Kirtz sued the agency under the Fair Credit Reporting Act.The USDA argued that the case should be dismissed based on sovereign immunity, since the Supreme Court has held that the federal government is immune from suits for damages unless Congress waives that immunity. The agency claimed that the FCRA does not make the federal government amenable to suit for a violation. The district court agreed, but the Third Circuit Court of Appeals reversed, finding that the FCRA authorizes suits for damages against any person who violates the Act, and “person” is defined to include any government agency.The U.S. Supreme Court affirmed the decision of the Third Circuit, finding that sovereign immunity did not bar Kirtz’s claim. The Court held that the federal government is susceptible to suit when it provides false information to credit reporting agencies. It noted that dismissing a suit like Kirtz’s case would effectively negate a claim that Congress has clearly authorized. The Court’s ruling resolved a circuit split between the Third, Seventh, and D.C. Circuits, with which the Court agreed, and the Fourth and Ninth Circuits, with which it disagreed. View "Department of Agriculture Rural Development Rural Housing Service v. Kirtz" on Justia Law

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Debt collector Rent Recovery Solutions (“RRS”) called Plaintiff to collect an alleged $900 debt to her former landlord. In June, without sending the relevant documents to Plaintiff, RRS reported her debt to TransUnion, a credit reporting agency, failing to tell TransUnion that the debt was disputed. Plaintiff commenced this action against RRS, alleging that it violated the Fair Debt Collection Practices Act (“FDCPA”). Plaintiff requested an award of $18,810 in attorneys’ fees for work by two attorneys and a paralegal. RRS challenged the fees requested by both attorneys, who submitted sworn declarations and detailed billing records. The district court, applying the lodestar method of calculating an attorney fee award, found that the attorneys’ claimed hourly rates were reasonable, but the hours expended on the case were excessive. The court reduced the claimed attorney hours by fifty percent, exclusive of paralegal work, and awarded Plaintiff $9,480 in attorneys’ fees. Plaintiff’s attorneys accused the district court of departing from the lodestar calculation by imposing a “cap” that violates FDCPA policies and deprives counsel of full compensation for bringing consumer enforcement actions under this complex federal statute.   The Eighth Circuit affirmed. The court explained that the district court followed the lodestar method, reducing the award based on its determination of the number of attorney hours reasonably expended on litigation. There is a “strong presumption” that the lodestar method represents a reasonable fee. The court wrote that the district court did not abuse its substantial discretion in finding that fifty hours was unreasonable for such a claim. View "Adrianna Beckler v. Rent Recovery Solutions, LLC" on Justia Law

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In 2022, the Commission promulgated a rule that set stringent safety standards for the operating cords on custom-made window coverings based on a finding that such cords pose a strangulation risk to young children. The rule sought to eliminate the risk of injury by essentially prohibiting corded window products, and it set an aggressive timeline for industry compliance with the new standards. The Window Covering Manufacturers Association (“WCMA”) filed a petition in this court challenging the rule and its compliance deadline.   The DC Circuit granted WCMA’s petition for review and vacated the rule. The court held that the Commission breached notice-and-comment requirements, erroneously relied on certain data in its cost-benefit analysis, and selected an arbitrary effective date for the rule. The court reasoned that the Commission did not explain why it chose to credit the opinion of Safe T Shade’s company president over the contrary feedback that it received from 401 other commenters, the Small Business Association, and its own staff.  The court explained that if the Commission wishes to extend a safety standard’s effective date, it must find good cause to do so, and regardless of such an extension, the Commission must find that the effective date. View "Window Covering Manufacturers Association v. CPSC" on Justia Law

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In this appeal arising out of a challenge to Rhode Island's liquor laws the First Circuit affirmed in part and vacated in part the judgment of the district court granting summary judgment for Defendants as to all claims, holding that the district court erred in granting summary judgment as to the constitutionality of the in-state-presence requirement for retailers.Plaintiffs, Rhode Island wine consumers, brought this action alleging that, in violation of the Commerce Clause, Rhode Island consumers are denied access to alcohol deliveries from out-of-state retailers. The district court granted summary judgment for Defendants. The First Circuit vacated the lower judgment in part, holding that the district court erred in entering summary judgment as to the constitutionality of the in-state-presence requirement for retailers and remanded for a fuller consideration of the parties' respective offers of proof. The district court upheld the in-state-presence requirement for retailers. The First Circuit affirmed the judgment in part and vacated it in part and remanded the matter for further proceedings, holding that a discriminatory aspect of the State's version of the "three-tier system" could not be affirmed. View "Anvar v. Dwyer" on Justia Law

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Brown’s credit-monitoring business used a “negative option feature” on its websites, offering visitors a free credit report but automatically enrolling them in a $29.94 monthly subscription when they applied for that report. Information about the monthly membership was buried . Brown’s contractors created website traffic by posting Craigslist advertisements for fake rental properties and directing applicants to the websites for a “free” credit score. The FTC sued under Federal Trade Commission Act (FTCA) section 13(b), which authorizes restraining orders and permanent injunctions to enjoin conduct that violates its prohibition of unfair or deceptive trade practices. On its face, section 13(b) authorizes only injunctive relief but the Commission long interpreted it to permit restitution awards—an interpretation adopted by the Seventh Circuit and others.The district court entered a permanent injunction and ordered Brown to pay more than $5 million in restitution. The Seventh Circuit overruled its precedent and held that section 13(b) does not authorize restitution awards.The Supreme Court granted certiorari and held that section 13(b) does not authorize equitable monetary relief. On remand, the Commission argued that the Court’s decision had significantly changed the law and successfully requested the reimposition of the restitution award under the Restore Online Shoppers’ Confidence Act and FTCA section 19. The Seventh Circuit modified the new judgment. Its direction that any funds remaining after providing consumer redress shall be “deposited to the U.S. Treasury as disgorgement” exceeds the remedial scope of section 19, which is limited to redressing consumer injuries. View "Federal Trade Commission v. Credit Bureau Center, LLC" on Justia Law

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The United States and the Commonwealth of Virginia (together, the “governments”) appealed the district court’s dismissal of their complaint under the False Claims Act and Virginia state law. The governments alleged that Walgreen Co. (“Walgreens”) misrepresented that certain patients met Virginia’s Medicaid-eligibility requirements for expensive Hepatitis C drugs. The district court dismissed the complaint, holding that Virginia’s eligibility requirements violated the Medicaid Act, and therefore Walgreens’s misrepresentations were immaterial as a matter of law.   The Fourth Circuit vacated and remanded. The court held that the governments plausibly allege facts that establish materiality. The court wrote that the alleged misrepresentation (that Patient 12 couldn’t use the cheaper drug alternative) has nothing to do with the eligibility requirements Walgreens now challenges. The district court didn’t explain how the supposed illegality of Virginia’s eligibility requirements rendered this misrepresentation immaterial or how it otherwise failed to state a claim. Further, the court explained it is also persuaded that Walgreens can’t avoid liability by collaterally challenging the eligibility requirements’ legality under a line of cases beginning with United States v. Kapp. Moreover, the court explained that Walgreens offers no good reason why a contract law (and even more specifically, a collective-bargaining-contract-law) rule should displace the liability created by the False Claims Act, a federal statute. View "US v. Walgreen Co." on Justia Law

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Over 20 years ago, a group of Florida wine consumers and an out-of-state winery (collectively, the “Plaintiffs”) sued the Director of the Florida Division of Alcoholic Beverages and Tobacco, alleging that certain provisions of Florida’s beverage laws unconstitutionally discriminated against out-of-state wineries. After the United States Supreme Court ruled a virtually identical statutory scheme unconstitutional, the Division agreed to the entry of a judgment declaring Florida’s direct shipment laws unconstitutional as applied to out-of-state “wineries.” The Division also agreed to an injunction prohibiting it from enforcing its direct shipment laws “against out-of-state vendors and producers.” Significantly, these last five words were absent from the parties’ proposed injunction and were added sua sponte by the district court. No one objected to the court’s addition of this language. However, 16 years later, the Division filed a motion in district court to “clarify and modify” the injunction. Specifically, the Division asked the district court to confirm that the injunction applied only to out-of-state wineries rather than out-of-state wine retailers generally. The district court denied the Division’s motion.   The Eleventh Circuit affirmed. The court explained that here, the district court expressly determined that the injunction the court entered “accurately reflects the intent of the parties and the Court.” Rule 60(a) does not allow a district court to rewrite its decision any time a party later contends that the language is ambiguous. Thus, the court held that the district court did not err by construing the Division’s motion as made under Rule 60(b)(1) instead of Rule 60(a). View "Jerry Bainbridge, et al. v. Director of the Florida Division of Alcoholic Beverages and Tobacco" on Justia Law

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Petitioner Green Development, LLC (Green Development) sought interconnection with the distribution system of Narragansett Electric Company (Narragansett), a public utility. Accommodation of the increased flows of electricity required certain upgrades to the transmission system owned by Respondent-Intervenor New England Power Company d/b/a National Grid (NE Power). NE Power assigned the costs of the transmission system upgrades directly to Narragansett. The newly assigned costs were reflected in a revised transmission service agreement (TSA) that NE Power and Narragansett filed for approval by the Federal Energy Regulatory Commission (Commission or FERC). Green Development protested the revised TSA. The Commission denied Green Development’s protest.  Green Development petitions for review contending that the Commission (1) erroneously concluded that Green Development’s arguments in the underlying section 205 proceeding operated as a “collateral attack” on the Complaint Order; (2) improperly applied the governing seven-factor test; (3) misinterpreted the Tariff’s definition of “direct assignment facilities”; and (4) erroneously failed to apply the filing procedures of Schedule 21-Local Service of the Tariff.   The DC Circuit denied the petitions. First, the court held that Commission has cured any purportedly erroneous ruling that Green Development’s section 205 protest constituted a collateral attack on the Complaint Order. The court rejected Green Development’s fourth claim. The court wrote that the issue with Green Development’s contention is that it presumes that the procedures in Schedule 21-Local Service are “mandatory processes” that applied to the filing of the TSA. But, the SIS and associated technical arrangements “pertain to initiating transmission service” and “do not demonstrate that Narragansett as an existing transmission customer was required to request new transmission service” under the Tariff. View "Green Development, LLC v. FERC" on Justia Law