Over the holidays, I enjoyed watching Pepsi, Where’s My Jet?, the Netflix four-episode documentary about John Leonard’s attempt to claim a Harrier fighter jet through the “Pepsi Stuff” promotion during the 1990s. Pepsi ultimately prevailed in the litigation that ensued when the soft-drink company denied Leonard’s claim. See Leonard v. Pepsico, Inc., 88 F. Supp.2d 116 (S.D.N.Y. 1999). Here are four thoughts that I had on the series as someone who practices consumer litigation.
CFPB is in Existential Crisis — and Covered Parties Have a Unique Opportunity
Due to a Fifth Circuit decision striking down the Consumer Financial Protection Bureau’s (CFPB) Payday Lending Rule promulgated in 2017 — in a case known as Community Financial Services Association of America, Limited v. CFPB — the Bureau’s very existence is in peril.
Some of the key takeaways from this decision are:
- CFPB’s funding structure violates the Constitution’s Appropriations Clause.
- There was a “linear nexus” between the unconstitutional funding mechanism and the challenged CFPB action — in this case, a
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Dr. Oz Suit Shows Not All Class Actions Result in Millions of Dollars
There is a public perception that class actions result in multimillion-dollar liability for the defendants. The recent settlement of Woodard v. Labrada, a case in which TV’s Dr. Mehmet Oz was originally named as a defendant, shows that is not always the case. The suit alleged misrepresentations regarding certain weight-loss supplements manufactured by Labrada Bodybuilding Nutrition, Inc., which the plaintiffs claimed Dr. Oz received compensation to promote on his TV show. After six years of litigation, Labrada — the only remaining defendant (the plaintiffs dismissed the allegations against Dr. Oz and other media defendants) — agreed to a settlement that requires the payment of just $625,000.
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No More Special Arbitration-Waiver Rules
On Monday, the U.S. Supreme Court, in Morgan v. Sundance, Inc., overturned the arbitration-specific waiver rules in nine circuits that had held a finding of prejudice was essential to determining whether a party had waived its right to arbitrate. Instead, courts should apply “ordinary procedural rules” — such as the federal law that waiver is the intentional relinquishment or abandonment of a known right (without a prejudice requirement) — to determine whether an arbitration agreement is enforceable.
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Introducing Taft Class Action & Consumer Insights
Welcome to Taft’s Class Action & Consumer Insights blog. Here, we will discuss developments in class actions and consumer statutes that are frequently the subject of class actions, such as the Fair Credit Reporting Act, the Telephone Consumer Protection Act, the Fair Debt Collection Practices Act, and various state-law consumer-protection statutes. We hope you enjoy.
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