Consumer Law & Policy Blog

Coordinators

  • Allison Zieve
    Public Citizen Litigation Group
  • Jeff Sovern
    St. John's University School of Law
  • Brian Wolfman
    Georgetown University Law Center and Harvard Law School

Other Contributors

  • Richard Alderman
    University of Houston Law Center
  • Paul Bland
    Public Justice
  • Stephen Gardner
    Consultant
  • Mike Landis
    US Public Interest Research Group
  • Paul Alan Levy
    Public Citizen Litigation Group
  • Scott Nelson
    Public Citizen Litigation Group
  • Ira Rheingold
    National Association of Consumer Advocates
  • Jon Sheldon
    National Consumer Law Center

About Us

www.clpblog.org

The contributors to the Consumer Law & Policy blog are lawyers and law professors who practice, teach, or write about consumer law and policy. The blog is hosted by Public Citizen Litigation Group, but the views expressed here are solely those of the individual contributors (and don't necessarily reflect the views of institutions with which they are affiliated). To view the blog's policies, please click here.

Blogs On Consumer Issues

  • Alabama Consumer Law Blog
  • Arnold & Porter Consumer Advertising Law Blog
  • CAFA Law Blog
  • Caveat Emptor
  • Citizen Vox
  • Consumer Affairs with Sheryl Harris
  • THE CONSUMERIST
  • Credit Slips
  • Home Equity Theft Reporter
  • Fair Arbitration NOW Blog
  • UCL Practitioner
  • U.S. PIRG Consumer Blog

Other Interesting Legal Blogs

  • American Constitution Society Blog
  • Balkinization
  • Concurring Opinions
  • The Conglomerate
  • Electronic Frontier Foundation DeepLinks
  • Empirical Legal Studies
  • How Appealing
  • Legal Theory Blog
  • Mass Tort Litigation Blog
  • Opinio Juris
  • PrawfsBlawg
  • Rebecca Tushnet's 43(B)log
  • SCOTUSblog
  • TortsProf Blog
  • Trademark Blog
  • Truth on the Market
  • The Volokh Conspiracy

Consumer Law & Policy Links

  • AAAP Foundation Litigation
  • American Collectors' Association
  • Americans for Financial Reform
  • American Tort Reform Association
  • American Association of Justice
  • Center for American Progress
  • Center for Justice and Democracy
  • Center for Responsible Lending
  • Center for Science in the Public Interest
  • Center for Study of Responsive Law
  • Consumer Action
  • Consumer Federation of America
  • Consumers Union
  • Electronic Frontier Foundation
  • Electronic Privacy Information Center
  • EU Consumer Policy Page
  • Fair Arbitration NOW
  • Federal Trade Commission
  • International Association of Consumer Law
  • National Association of Consumer Advocates
  • National Association of Consumer Bankruptcy Attorneys
  • National Community Reinvestment Coalition
  • National Consumer Law Center
  • Public Citizen
  • State PIRGs
  • Public Justice (formerly Trial Lawyers for Public Justice)
  • Treasury Department, Regulatory Reform Agenda
  • U.S. Chamber Legal Reform
  • U.S. Public Interest Research Group

« May 2008 | Main | July 2008 »

Monday, June 30, 2008

Oren Bar-Gill & Richard A. Epstein Debate Behavioral Economics vs. Neoclassical Economics in the Context of Consumer Contracts

Oren Bar-Gill of NYU and Richard A. Epstein of Chicago and Stanford's Hoover Institute have each contributed a piece to "Consumer Contracts: Behavioral Economics vs. Neoclassical Economics,"  92 Minnesota Law Review (2007-2008).  Here's the abstract:

In the past decade behavioral economics has established itself as a contender to the throne of neoclassical economics in the economic analysis of law. The pros and cons of behavioral as compared to neoclassical economics have been vigorously debated at the general, methodology level. But the success or failure of the behavioral challenge will be judged by its ability to improve upon neoclassical economics - both descriptively and prescriptively - in specific legal applications. Consumer contracts provide an important test case for behavioral economics. In this exchange we offer the first comprehensive debate between the behavioral and neoclassical perspectives as applied to the law and economics of consumer contracts.

Posted by Jeff Sovern on Monday, June 30, 2008 at 08:55 PM in Consumer Law Scholarship | Permalink | Comments (0) | TrackBack (0)

New Mexico Supreme Court strikes down class-action ban

Nm by Deepak Gupta

On Friday, New Mexico's highest court unanimously handed consumers an important victory, holding that, "in the context of small consumer claims that would be prohibitively costly to bring on an individual basis, contractual prohibitions on class relief are contrary to New Mexico's fundamental public policy of encouraging the resolution of small consumer claims and are therefore unenforceable in this state."  New Mexico joins a unanimous and growing group of state and federal courts in declaring that the Federal Arbitration Act does not preempt such state-law rulings--a question the U.S. Supreme Court refused to hear last month.

The New Mexico case involved allegations that Dell misrepresented the amount of memory in its computers--a misrepresentation that was widespread, but which cost each customer only $10-$20 each.  The opinion has some great language about the value of the class action device in cases involving small consumer claims.  The court recognized that "the class action functions as a gatekeeper to relief when the cost of bringing a single claim is greater than the damages alleged." Dell's class-action ban had "essentially foreclosed the possibility that Plaintiff may obtain any relief," such that "enforcing the class action ban would be tantamount to allowing Defendant to unilaterally exempt itself from New Mexico consumer protection laws." Congratulations go to Paul Bland and Amy Radon of Public Justice, who argued the unconscionability issue as amicus curiae.

Posted by Public Citizen Litigation Group on Monday, June 30, 2008 at 11:17 AM in Arbitration, Class Actions, Preemption, Unfair & Deceptive Acts & Practices (UDAP) | Permalink | Comments (3) | TrackBack (0)

Sunday, June 29, 2008

Times Reports that New Housing Bill Will Help Only a Fraction of Borrowers in Distress

29hous_3  Today's Times reports in "As Housing Bill Evolves, Crisis Grows Deeper," that the bill making its way through Congress will help only about 400,000 of the millions of borrowers in distress.  Some excerpts:

“It’s not enough, even in the best of circumstances,” said Mark Zandi, chief economist of Moody’s Economy.com. The number of people who will be helped “is going to be overwhelmed by the three million that are headed toward default.”

* * *

The effectiveness of the bill will depend to some extent on how it is handled by the F.H.A., an agency created during the Great Depression to insure home loans. It will have several challenges: persuading the lenders who made second mortgages and home equity loans to cooperate; screening loans to make sure borrowers have a good shot at keeping their homes after refinancing; and weeding out those trying to take advantage of the system.

Posted by Jeff Sovern on Sunday, June 29, 2008 at 10:02 PM in Foreclosure Crisis | Permalink | Comments (1) | TrackBack (0)

Obama on Consumer Debt

Obama Barack Obama discusses his legislative agenda regarding consumer debt with Michelle Singletary of the Washington Post. Obama notes that until he cashed in on his best-selling books, he and his wife were carrying significant student loan debt. "We were making payments the size of a mortgage every month," Obama said.

Posted by Brian Wolfman on Sunday, June 29, 2008 at 02:50 PM in Consumer Legislative Policy | Permalink | Comments (2) | TrackBack (0)

House of Representatives Holds Hearing on Credit Card Marketing to Students

Check out this post over at U.S. PIRG's Consumer Blog discussing the hearing last Thursday held by the House Financial Service Committee's Financial Institutions and Consumer Credit subcommittee regarding marketing of credit cards to college students. We have previously blogged on this topic here and here (click on the video).

Posted by Brian Wolfman on Sunday, June 29, 2008 at 02:43 PM in Predatory Lending | Permalink | Comments (0) | TrackBack (0)

Legendary Plaintiffs' Lawyer Dickie Scruggs Sentenced to Five Years in Prison for Bribing a Judge

The headline of this post gives you the gist. For the sordid details, see this article from the New York Times.

Posted by Brian Wolfman on Sunday, June 29, 2008 at 02:14 PM | Permalink | Comments (0) | TrackBack (0)

Saturday, June 28, 2008

Times Articles on the Tort War, Illinois' Suit Against Countrywide, and Google's Marketing

Recent articles from the Times of interest:

Yesterday's edition contains "Google Tries Tighter Aim for Web Ads" about how Google uses what a consumer searched for a few minutes ago to target ads for that user.  Another article, "Post-Spitzer, A New Breed of Reformer," explores the differences between former New York Attorney General Eliott Spitzer's and the current New York Attorney General Andrew M. Cuomo's approaches to bringing cases against the financial industry.

Here is Wednesday's report on the Illinois case against Countrywide, a case Alan White reported on yesterday.

Last Sunday's issue brought "To the Trenches: The Tort War is Raging On," about business's attempts to take on the trial bar.  Some excerpts:

Businesses count among the victories federal legislation passed in 2005 that made it harder to file class-action lawsuits in state courts, where judges and juries were often perceived as hostile to business. In state courts, where most civil litigation plays out, the number of suits involving auto accidents, allegations of medical malpractice and the like fell steadily from 1995 to 2005, according to the National Center for State Courts. The Chamber of Commerce says the number of megaverdicts for more than $100 million dropped to 2 last year, from 27 in 2000.

NEVERTHELESS, there are battles in individual states over judicial campaigns and legislative initiatives.  * * *

Strikingly absent from debates over who should be able to sue whom, when and for how much is any discussion of the fairest and most effective way to make sure that true victims are appropriately compensated for injuries and that people without authentic injury are not compensated.

“That’s not the conversation we’re having,” because the only voices heard belong to advocates of one side or the other, said Robert L. Rabin, a law professor at Stanford. “Those advocates reflect advocacy interests — that is, either defense-side interests or plaintiff-side interests — rather than some overview of global fairness.”

Posted by Jeff Sovern on Saturday, June 28, 2008 at 10:35 AM in Advertising, Foreclosure Crisis, Internet Issues, Predatory Lending, Privacy | Permalink | Comments (0) | TrackBack (0)

Friday, June 27, 2008

States going after Countrywide

By Alan White

Biz031bIllinois, California and Washington all filed actions against Countrywide this week alleging a variety of deceptive practices and fair lending violations. The California complaint attacks a variety of origination practices, especially involving negative amortizing mortgages (so-called pay option ARMs) and hybrid ARMs. The Washington DFI's complaint proposes to revoke Countrywide's license to make mortgage loans in the state, based among other things on evidence of race discrimination in mortgage pricing. Illinois Attorney General Lisa Madigan's particularly thorough and well-researched complaint focuses on unreasonable forecosure risk as a violation of consumer fraud and fair lending laws, but also challenges other origination and servicing practices.

North Carolina's Banking Department entered into a consent order with Countrywide last March, and Countrywide has surrendered a number of branch licenses in New York. It seems likely that other states will join, and perhaps organize a multi-state task force, as was done in the Ameriquest and Household Finance cases, among others. If any commenters are aware of other state filings I will be happy to add links to this post. (HT NY Post for the graphic.)

All this on the heels of the shareholders' approval of the merger between Countrywide and BankofAmerica. Approval by the Countrywide shareholders, that is.

UPDATE: The June 30 complaint filed by the FLORIDA attorney general is available here.

Posted by Alan White on Friday, June 27, 2008 at 08:04 AM in Foreclosure Crisis, Predatory Lending | Permalink | Comments (2) | TrackBack (0)

Thursday, June 26, 2008

Study Finds that Firms That Use Arbitration Clauses in Consumer Contracts Often Do Not Use Such Clauses in Nonconsumer Contracts

In "Arbitration's Summer Soldiers: An Empirical Study of Arbitration Clauses in Consumer and Nonconsumer Contracts," Theodore Eisenberg of Cornell, Geoffrey P. Miller of NYU, and Emily L. Sherwin of Cornell report that firms that use arbitration clauses in consumer contracts often do not use arbitration clauses in nonconsumer contracts.  Here's the abstract:

We provide the first study of varying use of arbitration clauses across contracts within the same firms. Using a sample of 26 consumer contracts and 164 nonconsumer contracts from large public corporations, we compared arbitration clause use in consumer contracts with their use in the same firms' nonconsumer contracts. Over three-quarters of the consumer agreements provided for mandatory arbitration but less than 10% of the firms' material nonconsumer, nonemployment contracts included arbitration clauses. The absence of arbitration provisions in nearly all material contracts suggests that, ex ante, many firms value, even prefer, litigation over arbitration to resolve disputes with peers. The frequent use of arbitration clauses in the same firms' consumer contracts appears to be an effort to preclude aggregate consumer action rather than, as often claimed, an effort to promote fair and efficient dispute resolution. Other common features of civil litigation reform discussion, avoidance of juries and loser-pays attorney fee rules, find little support in the pattern of contractual terms we observe.

Posted by Jeff Sovern on Thursday, June 26, 2008 at 10:15 PM in Arbitration, Consumer Law Scholarship | Permalink | Comments (0) | TrackBack (0)

Mynutritionstore’s not-so-ingenious theory to evade the CDA’s protection for consumer complaint sites

by Paul Alan Levy

In a recent series of demands, a purveyor of “nutraceuticals” called mynutritionstore.com threatened to sue Julia Forte over consumer criticisms appearing on her web site 800notes.com, a forum for identification and discussion of telemarketers based on their phone numbers.  (The specific dispute is summarized here)  My Nutrition Store’s expressed concern was that the comments about it show up in Google searches.

When Forte replied by citing her protection under the Communications Decency Act, 47 U.S.C. § 230,  which generally immunizes hosts of discussion sites against suit based on what consumers say on their sites, mynutritionstore’s lawyer, Thomas Georgianna, of the law firm of Horwitz & Cron, had what he no doubt thought was an ingenious response – if he couldn’t sue on the merits, he could sue the anonymous commenters, join the web host as a “necessary party,” seek a preliminary injunction, and thus force the web host to spend money on lawyers, driving up its costs.   He apparently hoped that the threat of such expenses would drive Forte to comply with his demands.

Continue reading "Mynutritionstore’s not-so-ingenious theory to evade the CDA’s protection for consumer complaint sites" »

Posted by Paul Levy on Thursday, June 26, 2008 at 03:51 PM in Free Speech, Intellectual Property & Consumer Issues | Permalink | Comments (4) | TrackBack (0)

Older »

Subscribe to CL&P

RSS/Atom Feed

To receive a daily email of Consumer Law & Policy content, enter your email address here:

Search CL&P Blog

Recent Posts

  • My latest paper: Not-So-Smartphone Disclosures
  • Maryland seeking applications for consumer law endowed faculty position
  • FTC issues ANPR on consumer privacy and data security
  • Today at the CFPB
  • Cal Chief Judge calls for stronger oversight of "private judging," after scandal involving JAMS
  • Maybe it's the Chamber that needs to be held accountable: comments on their ad attacking the CFPB
  • Bruckner & Ryan paper compares complaints about fintech and traditional student loan lenders & servicers
  • GOP legislators accuse CFPB of colluding with states, as Kraninger did
  • WSJ: Equifax Sent Lenders Inaccurate Credit Scores on Millions of Consumers
  • Unfairness and Disparate Effects
  • CFPB analysis of potential impacts of medical debt credit reporting changes
  • OCC CFP: THE IMPLICATIONS OF FINANCIAL TECHNOLOGY FOR BANKING
  • Dan Solove gives the pending privacy bill a B+ but pans preemption
  • Paper responds to Wilf-Townsend's Assembly-Line Plaintiffs
  • CFP: Berkeley Consumer Law Conference
  • The National Consumer Law Center is hiring a LITIGATION DIRECTOR
  • WSJ: CFPB working on guidance to force banks to cover more scams on Zelle and similar apps
  • Consumer law and the "major questions" doctrine
  • Will Congress pass an online privacy bill?
  • Distracted driving kills thousands of people every year
  • Chao paper suggests unjust enrichment claims confer standing, even after TransUnion
  • CFPB issues advisory to protect privacy when companies compile personal data
  • Regulators fine BofA $225 million over botched disbursement of unemployment benefits
  • Consumer protection and the Supreme Court's new "major questions doctrine"
  • CFPB moves to reduce fees charged by debt collectors
  • Vijay Raghavan Essay: Shifting Burdens at the Fringe
  • FTC sues Walmart for facilitating money transfer fraud
  • CFPB affirms states' ability to police credit reporting markets
  • Can you solve the mystery of why the Credit CARD Act treats penalty fees differently from penalty interest rates and other fees?
  • CFPB Spring Regulatory Agenda is up and arbitration isn't on it
  • CFP: CFPB consumer finance research conference
  • My Daughter’s @Delta Disaster Story: The Last Chapter (I hope)

Categories

  • Advertising
  • Arbitration
  • Auto Issues
  • Book & Movie Reviews
  • Books
  • CL&P Blog
  • CL&P Roundups
  • Class Actions
  • Conferences
  • Consumer Financial Protection Bureau
  • Consumer History
  • Consumer Law Scholarship
  • Consumer Legislative Policy
  • Consumer Litigation
  • Consumer Product Safety
  • Credit Cards
  • Credit Reporting & Discrimination
  • Debt Collection
  • Federal Trade Commission
  • Food and Nutrition
  • Foreclosure Crisis
  • Free Speech, Intellectual Property & Consumer Issues
  • Global Consumer Protection
  • Identity Theft
  • Internet Issues
  • Law & Economics
  • Other Debt and Credit Issues
  • Predatory Lending
  • Preemption
  • Privacy
  • Student Loans
  • Teaching Consumer Law
  • Television
  • U.S. Supreme Court
  • Unfair & Deceptive Acts & Practices (UDAP)
  • Web/Tech
  • Weblogs

Archives

  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021

August 2022

Sun Mon Tue Wed Thu Fri Sat
  1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31