UDAAP Council Weekly UDAAP Standards Report - 3/18/2015

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Every week, courts around the United States issue decisions addressing aspects of civil UDAAP claims. In an effort to illuminate the UDAAP standards, below is a sampling of some of this week’s UDAAP decisions on the meaning of unfair, deceptive, and abusive.

Unfair

  • The Consumer Financial Protection Bureau’s (CFPB) suit against a for-profit college for violation of the Consumer Financial Protection Act (CFPA) alleged that it committed “unfair” and “abusive” acts or practices. The college argued that “unfair” and “abusive” are undefined and “standardless” terms that fail to give notice of what is prohibited. The court disagreed, finding that the body of authority regarding the “unfair” standard under the Federal Trade Commission Act provides a century’s worth of guidance on its meaning, and that the CFPA’s “abusive” standard provides “at least the minimal level of clarity” that due process requires. The court noted, however, that it was not deciding whether the “abusive” standard might be unconstitutionally vague when applied in other contexts. Consumer Financial Protection Bureau v. ITT Education Services, Inc., United States District Court for the Southern District of Indiana.

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UDAAP Council Weekly UDAAP Standards Report - 3/11/2015

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Every week, courts around the United States issue decisions addressing aspects of civil UDAAP claims. In an effort to illuminate the UDAAP standards, below is a sampling of some of this week’s UDAAP decisions on the meaning of unfair, deceptive, and abusive. Continue reading this entry

Recent Settlements of Joint UDAAP Enforcement Between State and Federal Regulators

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The Dodd-Frank Act (“Dodd-Frank”) granted to state attorneys general and state regulators much of the Consumer Financial Protection Bureau’s (“CFPB”) UDAAP authority. In particular, Dodd-Frank gives state attorneys authority to enforce the UDAAP prohibition in the Consumer Financial Protection Act (“CFPA”) against non-banks and state-chartered financial institutions under their jurisdiction, as well as CFPB regulations that affect such institutions. Dodd-Frank also authorizes state regulators to bring UDAAP claims (and claims under CFPB-issued regulations) against any entity that is state-chartered, incorporated, licensed, or otherwise authorized to do business under state law. The remedies available under the CFPA are significantly more robust than the remedies otherwise available to many state regulators.

A series of recent settlement activity suggests an increase in state enforcement under Dodd-Frank’s state action provisions. Continue reading this entry

State Attorneys General Return to Health Care Reform in U.S. Supreme Court

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On Wednesday, the U.S. Supreme Court will hear arguments in what is being teed up to be “Round 2” on the Affordable Care Act (ACA). In the case King v. Burwell, the question before the Court is whether the IRS can extend tax credit subsidies to those using the federal health care exchange when the ACA limits subsidies to exchanges “established by the state.” This question of statutory interpretation may go as much to the heart of the ACA as the prior constitutional challenge on the individual mandate. Continue reading this entry

UDAAP Council Weekly UDAAP Standards Report - 2/25/2015

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Every week, courts around the United States issue decisions addressing aspects of civil UDAAP claims. In an effort to illuminate the UDAAP standards, below is a sampling of some of this week’s UDAAP decisions on the meaning of unfair, deceptive, and abusive.

Unfair

  • Debtors adequately stated a claim under the Florida Consumer Collection Practices Act (FCCPA) for alleged unfair and abusive debt collection practices by a timeshare creditor and its debt collector agent. The defendants moved to dismiss the complaint for failing to adequately allege abusive or harassing behavior. The court held that the frequency of defendants’ calls from an automatic dialing system (averaging 2.5 calls a day), coupled with debtors’ requests to cease communications, was sufficient to state a claim. Mangiaracina v. Orange Lake Country Club, Inc., United States District Court for the Middle District of Florida.

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