NEW YORK (Legal Newsline) - The U.S. Supreme Court's recent Spokeo decision has helped a defendant in a Truth in Lending Act lawsuit decided by the U.S. Court of Appeals for the Second Circuit.
On Nov. 23, the Second Circuit issued its opinion in Strubel v. Comenity Bank, which featured a plaintiff challenging the way Comenity issued disclosures on a retail store credit card.
The plaintiff, Abigail Strubel, filed a TILA lawsuit over four disclosures, arguing the bank failed to let consumers know they had limited time to
stop payment on automatic payment plans and that there was a requirement to
acknowledge alleged billing errors within a 30-day period and report if any
corrections had been made, among other allegations.
Circuit has issued an opinion that has substantive Truth in Lending Act implications, said John Raffetto, a senior associate in Goodwin
Law’s Consumer Financial Services practice - "The court came to different
conclusions on the standing questions on the first two (claims) and then on the second
two," he said.
As part of the plaintiff’s appeal, she argued summary judgment was not applied properly to Comenity Bank because of failures
listed in the initial argument and because the disclosures in question were not the same as
those provided in the TILA implementing regulation, which is Regulation Z.
On appeal, Comenity cited
Spokeo v. Robins as a reason the plaintiff did not have standing to sue. That 2016 U.S. Supreme Court decision requires plaintiffs to show a concrete harm has happened to them.
“The Spokeo argument came up on appeal. It was not raised at the district court
level. The court took a look at these
four different disclosures and considered using Spokeo,” Raffetto said.
court looked at) whether or not the plaintiff had standing to attack all four
or any of these disclosures and the court concluded in two cases, the
plaintiff did not have standing, and so the focus there was on the injury-in-fact element.”
The Second Circuit ruled that Strubel did not have standing to pursue TILA claims regarding two of Comenity's disclosures, and that her other two claims regarding disclosures failed as a matter of law, though she did have standing to pursue them.
She lacked standing in her argument that Comenity Bank failed to provide a timely stop-payment notice in an automatic-payment plan and that she never agreed to such a plan.
The court did say the plaintiff had standing to challenge
Comenity’s disputed purchases and purchase dissatisfaction disclosures because
those disclosures served to protect a consumer's concrete interest in avoiding the uniformed use of credit.
Raffetto said there were no surprises in this case but “people
in the legal industry are very interested in how is that case going to be