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Wednesday, January 18, 2012

Jenzabar Persists in Trademark Bullying

by Paul Alan Levy

Jenzabar, a Boston-based educational software company run by the chairman of the Massachusetts Republican Party, continues in its efforts to abuse trademark law to punish the makers of a documentary film that shows one of the company's founders making brash statements as a student, hoping for a bloodbath that would spur a popular uprising in China, that she has since come to regret.  Instead of suing over the accuracy of the film, Jenzabar complains about a page on the film-related web site from which, it fears, customers might learn what the filmmakers have republished from the Boston Globe about Jenzabar itself. 

I blogged about the case several times a couple of years ago (for example, here and here), while the summary judgment motion was pending.   Jenzabar’s claim was that by putting its name in the keyword meta tags and title tag of a page about Jenzabar, the documentarists were unfairly bringing Jenzabar’s prospective customers to a web page where they might read "lies about Jenzabar" and hence decide not to do business with it. 

Although we made a number of technical trademark arguments about the lawsuit, the most troubling thing about the suit was that, in the end, what Jenzabar wanted to prevent was customer access to criticism, and trademark law is not supposed to prevent criticism.  In the end, the Massachusetts Superior Court granted summary judgment dismissing the trademark claims, while postponing a decision on whether Jenzabar would have to reimburse Long Bow’s hundreds of thousands of dollars in attorney fees, pending a decision on Jenzabar’s appeal.

We filed our brief today in response to Jenzabar’s appeal, pointing out the many ways in which its lawsuit was flawed from the get-go.  But one more oddity has been added to the case – after Jenzabar complained that the descriptive snippet that Google was including in the search results was what might deceive customers looking for information about Jenzabar, Long Bow added a description meta tag referring to Jenzabar’s effort to censor the site.   Google's search result snippet now reads: “Jenzabar has tried to censor this web page because it carries critical information about the software company that Chai Ling started with her husband.”  But Jenzabar still claims that because the search result appears in the first set of Google results, it is still an “infringing use” because its customers might be deceived.  Will its lawyer be able to argue that with a straight face?

The expense of defending the lawsuit came close to putting the documentarists out of business.  A very nice amicus brief from the Berkman Center's newly-renamed Digital Media Law Project points out the danger posed by subjecting expressive uses to the trademark laws, given how expensive it is to pay for hundreds of hours of legal work, not to speaking of hiring the expert witnesses and conduct the consumer surveys that have become the typical meat of a trademark case.

Posted by Paul Levy on Wednesday, January 18, 2012 at 06:57 PM | Permalink | Comments (0) | TrackBack (0)

Another Paper on Discrimination in Mortgage Markets

R. Glenn Hubbard

 of Columbia Business School and the National Bureau of Economic Research (NBER), Darius Palia of Rutgers Business School, and

Wei Yu

 of California State Polytechnic University, Pomona have written Analysis of Discrimination in Prime and Subprime Mortgage Markets.  Here's the abstract:

This paper examines evidence of lending discrimination in prime and subprime mortgage markets in New Jersey. Existing single-equation studies of race-based discrimination in mortgage lending assume race is uncorrelated with the disturbance term in the loan denial regression. At the individual loan-level, we show that race is correlated with both observable and unobservable risk variables, leading to biased coefficient estimates. To mitigate this problem, we specify a system of equations and use a full information maximum likelihood (FIML) method that does not need to identify instrumental variables for system identification. We find that minorities are less likely to be rejected than whites in the subprime market. The individual loan-level FIML results are robust to using two-stage least squares when we examine discrimination at the neighborhood-level. We also find that the reduction in rejection rates to minority neighborhoods from 1996 to 2008 cannot be fully justified by risk, suggesting a relaxation of lending standards to minority neighborhoods. Using the methodology of Mian and Sufi [2009], we also find evidence for strong credit supply effects.

 

Posted by Jeff Sovern on Wednesday, January 18, 2012 at 06:23 PM in Consumer Law Scholarship, Credit Reporting & Discrimination | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 17, 2012

Mary Spector Study of Debt Collection Litigation

Mary Spector of SMU has written Debts, Defaults and Details: Exploring the Impact of Debt Collection Litigation on Consumers and Courts, 6 Virginia law and Business Review 257 (2011).  Here's the abstract:

This Article explores consumer collection litigation through original research from more than five hundred cases filed in the Dallas County courts. It analyzes the data within the context of the modern debt collection industry, paying special attention to the role of debt buyers and to the peculiar legal issues their involvement raises. After explaining the methodology and mechanics used to gather and analyze the data, the Article discusses the data collected, identifying and analyzing the most significant findings and placing them within a larger legal landscape. While the research confirms anecdotal reports of litigation abuse in consumer collection cases, it also reveals some surprising patterns. For example, the research indicates that consumer default was not the most common outcome and that minimal effort by consumers often considerably helped to protect their rights and favorably to conclude the litigation. The Article concludes by discussing some of the implications for the judicial system and by suggesting additional areas of research that would increase understanding of the challenges the litigation presents for parties, their lawyers, and the courts.

Posted by Jeff Sovern on Tuesday, January 17, 2012 at 03:29 PM in Consumer Law Scholarship, Debt Collection | Permalink | Comments (6) | TrackBack (0)

Monday, January 16, 2012

The Arbitration Fairness Act

Just days after the Supreme Court's 8-1 decision in Compucredit v. Greenwood -- holding that the Federal Arbitration Act (FAA) trumps court access for consumers under the Credit Repair Organizations Act -- David Lazarus of the LA Times says that it is high time for Congress to pass the Arbitration Fairness Act. That Act would restore court access for consumers and employees in the wake of a series cases of Supreme Court cases interpreting the FAA that effectively eliminate consumers' ability to obtain remedies for violations of substantive law.

Posted by Brian Wolfman on Monday, January 16, 2012 at 03:29 AM | Permalink | Comments (1) | TrackBack (0)

New and Interesting Affordable Care Act Analyses

I. Glenn Cohen, an assistant professor at Harvard Law School, has generated two interesting items on the challenges to the Affordable Care Act. First, he has written this opinion piece for the New England Journal of Medicine arguing that the provisions of the Act expanding the reach of the Medicaid program are constitutional.

Cohen also sat for this interview in which he describes, clearly and with sophistication, each of the challenges to the Affordable Care Act now before the Supreme Court. It's very good and definitely worth a listen.

Posted by Brian Wolfman on Monday, January 16, 2012 at 02:55 AM | Permalink | Comments (1) | TrackBack (0)

Sunday, January 15, 2012

Oren Bar-Gill on Consumer Protection and Behavioral Economics

Oren Bar-Gill of NYU has written Competition and Consumer Protection: A Behavioral Economics Account, forthcoming in SWEDISH COMPETITION AUTHORITY, THE PROS AND CONS OF CONSUMER PROTECTION. Here's the abstract:

 

 Do the benefits of competition extend to a world with imperfectly rational consumers? I argue that sellers, operating in a competitive market, will design their products, contracts and pricing schemes in response to consumer misconception, resulting in both efficiency losses and harm to consumers. Under certain conditions, competition provides incentives for sellers to educate consumers and reduce misconception, but these mistake-correction forces are limited. The existence of biased demand, generated by imperfectly rational consumers, creates a market failure – a behavioral market failure. Mandated disclosure, deliberately designed for imperfectly rational consumers, or for sophisticated intermediaries that advise imperfectly rational consumers, can help.

 

 

Posted by Jeff Sovern on Sunday, January 15, 2012 at 08:42 PM in Consumer Law Scholarship | Permalink | Comments (4) | TrackBack (0)

Saturday, January 14, 2012

Diane Thompson on Home Loan Modifications

Diane Thompson of the National Consumer Law Center has written this piece in the Washington Law Review on why mortgage servicer incentives discourage home loan modifications. Here is the abstract:

Despite record losses to investors, homeowners, and surrounding communities, the foreclosure crisis continues to swell. Many commentators have urged an increase in the number of loan modifications as a solution to the foreclosure crisis. The Obama Administration created a program specifically designed to encourage modifications. Yet, the number of foreclosures continues to outpace modifications.

One reason foreclosures outpace modifications is that the mortgage-modification decision maker’s incentives generally favor a foreclosure over a modification. The decision maker is not the investor or the lender, but a separate entity, the servicer. The servicer’s main function is to collect and process payments from homeowners, and servicers do not necessarily have any ownership interest in the loan. Servicers, unlike investors, generally recover all their hard costs after a foreclosure, even if the home sells for less than the mortgage loan balance. Servicers may even make money from foreclosures through charging borrowers and investors fees that are ultimately recouped from the loan pool.

Existing regulatory guidance could be improved to facilitate modifications. Investors need increased transparency to hold servicers accountable for failing to make modifications when it is in the investors’ best interests to make modifications. Fundamentally, servicers must be required to make modifications when doing so would benefit the trust as a whole.

Posted by Brian Wolfman on Saturday, January 14, 2012 at 08:47 AM | Permalink | Comments (1) | TrackBack (0)

Friday, January 13, 2012

Chamber of Commerce Won't Sue to Challenge Cordray Recess Appointment

Here.  They may sue later, however.  Or others might.  Or a challenge to the NLRB recess appointments made at the same time may decide the question.

Posted by Jeff Sovern on Friday, January 13, 2012 at 04:35 PM in Consumer Financial Protection Bureau | Permalink | Comments (0) | TrackBack (0)

New NCLC Practice Tools

By Jon Sheldon

1. NCLC Released 4 Revised Editions in December (subscribers have received them by now, others can order them at www.nclc.org/shop or 617-542-9595):

  • Consumer Arbitration Agreements (6th ed.)
  • Automobile Fraud (4th ed.)
  • Access to Utility Service (5th ed)
  • Consumer Law Pleadings (Website and 2011 Index Guide)

2. NCLC also released 6 Supplements in December (same ordering information):

  • Consumer Bankruptcy Law and Practice 2011 Supp.
  • Truth in Lending 2011 Supp.
  • Fair Credit Reporting 2011 Supp.
  • Unfair and Deceptive Acts and Practices 2011 Supp.
  • Student Loan Law 2011 Supp.
  • Repossessions 2011 Supp.

3. Fair Credit Reporting Supp. Addendum: Those who have already received or just ordered the December, 2011 Supplement to NCLC'sFair Credit Reporting should print out a 4 page addendum to section 7.2.3, Permissible Use in Connection with Credit. Please go to www.nclc.org/fcr2011.  [Subscribers can also receive a hard copy in the mail by contacting publications@nclc.org.]  Anyone ordering the Supplement now automatically receives the addendum as part of their Supplement package.

4. NCLC REPORTS Nov./Dec. Issues: 
Bankruptcy & Foreclosures Ed.: New bankruptcy rules and forms respond to servicing and mortgage claim documentation issues, available for free at www.nclc.org/form10

Consumer Credit & Usury Ed.: Top 10 ways to defeat the BFP defenses in foreclosure rescue fraud cases; the deadline to enforce TILA rescission

Deceptive Practices & Warranties Ed.: Pursuing class actions despite arbitration clauses; new federal program and California law revolutionize car purchasers;12 tips on utility disconnections

Debt Collection & Repossessions Ed.: sanctions for denying collector had insurance; FDCPA limits on leaving messages for consumers; robo-calling bill killed; TCPA decisions; thousands of collection actions stayed; libel claim against a creditor

5. NCLC Webinar Series continues: Jan. 26 at 2PM: "Understanding the Impact of Car Ownership Programs” and February 8th at 2PM: “So What Is Lobbying and What Can I do as a Non-Profit/Legal Aid Program?” Contact jhiemenz@nclc.org for this and future webinars. Go to www.nclc.org/conferences-training/webinars.html for FREE downloads of over 50 past webinars.

6. REGISTER NOW: Fair Debt Collection Practices Training Conference is in New Orleans, Feb. 23-24,2012. Go here to register and reserve your hotel room at: www.nclc.org/conferences-training/fair-debt-collection-practices-conference.html Get up to speed on your first debt collection abuse cases and proceed to more in-depth sessions on developing fair debt collection cases and a fair debt collection law practice. Faculty includes the top Fair Debt Collections Lawyers from across the country. CLE credit.

Posted by Greg Beck on Friday, January 13, 2012 at 03:17 PM | Permalink | Comments (0) | TrackBack (0)

Department of Justice's Office of Legal Counsel Says President Obama's Recent Recess Appointments Were Legal

Read OLC's opinion here.

Posted by Brian Wolfman on Friday, January 13, 2012 at 07:08 AM | Permalink | Comments (3) | TrackBack (0)

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