Consumer Law Round-Up
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Hosted by the Jenner & Block's Consumer Law Group, the blog updates readers on key developments within consumer law and provides insights that are relevant to companies and individuals that may be affected by the ever-increasing patchwork of federal and state consumer protection statutes.
Consumer Law Round-Up
1y ago
By Jacob D. Alderdice and Michael W. Ross
In a recent interpretive rule announced on August 10, 2022,—and unveiled at a summit of the National Association of Attorneys General—the CFPB stated that digital marketers are subject to the CFPB’s jurisdiction, and expressly warned that it may take enforcement action against these entities. Such enforcement is likely to concern anti-discrimination provisions, and the new rule notes that State Attorneys General have jurisdiction to enforce these rules as well.
Prior to the CFPB’s August 10 rule, digital marketers—companies that market to consumers thr ..read more
Consumer Law Round-Up
1y ago
By: Madeleine V. Findley and Effiong K. Dampha
On August 24, 2022, California Attorney General Rob Bonta announced a $1.2 million settlement with cosmetics retailer Sephora Inc. (Sephora), the first public enforcement action under the California Consumer Privacy Act (CCPA).[1] The settlement resolved allegations that Sephora failed to disclose it was selling consumers’ personal information, failed to honor opt-out requests from user-enabled global privacy controls, and failed to cure these violations within 30 days, as required by CCPA. The settlement is part of “an enforcement sweep ..read more
Consumer Law Round-Up
1y ago
By: Alexander M. Smith, Jenna L. Conwisar, and Peter Welch
New York’s two principal consumer fraud statutes, N.Y. G.B.L. §§ 349 and 350, authorize statutory damages of $50 or $500 per violation respectively. In false advertising cases involving low-cost consumer products, these statutes pose the risk that defendants may face hundreds of millions—if not billions—of dollars in exposure if found liable at trial. And while N.Y. C.P.L.R. § 901(b) seeks to avert this result by prohibiting courts from awarding statutory damages in class actions, the Supreme Court has held that this is a “procedural ..read more
Consumer Law Round-Up
2y ago
By: Jeremy M. Creelan, Megan B. Poetzel, Jenna E. Ross, and Karolina L. Bartosik
The regulation and enforcement of financial technology (Fintech) remains in sharp focus for California’s consumer finance regulator, the Department of Financial Protection and Innovation (DFPI), as it moves into its second year of operation. This Alert provides a short overview of the DFPI’s origins, a comparison of the DFPI’s stated priorities with its regulatory activities in its inaugural year, and an analysis of recent enforcement actions relevant to Fintech.
Background
In August 202 ..read more
Consumer Law Round-Up
2y ago
By: Jenna L. Conwisar
Payday loans are small-dollar cash loans typically due in a single payment on the borrower’s next payday—they are extremely short-term and generally high-interest forms of consumer credit.[1] If the borrower cannot pay off the loan when it’s due, some states allow the borrower to pay a fee to defer full payment on, or “rollover,” their loan. A 2014 Consumer Financial Protection Bureau (CFPB) report found that over 80% of payday loans are rolled over within two weeks.[2]
The CFPB notes that upwards of 12 million borrowers utilize payday loans each year.[3] 16 states now r ..read more
Consumer Law Round-Up
2y ago
By: Laura P. MacDonald, Elizabeth A. Edmondson, and Adina Hemley-Bronstein
On March 31, 2022, the US Supreme Court issued a significant decision in Badgerow v. Walters, No. 20-1143, ending a circuit split about when federal courts have subject matter jurisdiction to review domestic arbitration awards under the Federal Arbitration Act (FAA). In an 8-1 opinion, the Court ruled that federal courts cannot “look through” to the underlying controversy to establish subject matter jurisdiction to confirm or vacate an arbitral award under the FAA. As a result, absent diversity of citizenship, petitione ..read more
Consumer Law Round-Up
2y ago
By: Michael W. Ross, Ali M. Arain, and Jonathan S. Steinberg
On March 16, 2022, the Consumer Financial Protection Bureau (CFPB) announced its intent to address discrimination as an “unfair practice” under the Consumer Financial Protection Act (commonly known as Dodd-Frank). Specifically, by indicating that discrimination falls within “unfair practices” in its Exam Manual, the CFPB has authorized its examiners to look “beyond discrimination directly connected to fair lending laws” and ask companies to “review any policies or practices that exclude individuals from products and servi ..read more
Consumer Law Round-Up
2y ago
By Matthew G. Lawson
On Thursday, March 17, 2022, the Ninth Circuit issued a critical decision in California Chamber of Commerce v. CERT, No. 21-15745 (9th Cir. 2022), reinstating a preliminary injunction against the filing or prosecuting of any new lawsuits to enforce Proposition 65’s warning requirements as applied to acrylamide in food and beverage products. The decision reinstalls a roadblock against future lawsuits and may offer a light at the end of the tunnel for the regulated community by signaling the existence of a valid defense against Proposition 65 claims where the health r ..read more
Consumer Law Round-Up
2y ago
By: Michael W. Ross, Ali M. Arain, and Jonathan Steinberg
Late last month, the Consumer Financial Protection Bureau (CFPB) took another step toward adopting rules governing the use of artificial intelligence (AI) and algorithms in appraising home values. Specifically, the CFPB issued a detailed outline and questionnaire soliciting feedback from small business entities on a proposed rulemaking proceeding for using Automated Valuation Models (AVMs).
The CFPB and other federal regulators[1] intend to adopt rules designed to: (1) ensure a high level of confidence in the estimates produced by AVMs ..read more
Consumer Law Round-Up
2y ago
By Ali M. Arain, Michael W. Ross, and Jonathan Steinberg
Potential discrimination and bias resulting from consumer tools based on artificial intelligence and automated data will be an enforcement focus of regulators this year, Jenner & Block attorneys predict. Accuracy and transparency are also on the table, they say.
Given the growing use of artificial intelligence (AI) and automated decision-making tools in consumer-facing decisions, we expect federal regulators in 2022 to continue their recent track record of interest in potential discrimination and unfairness, as well as da ..read more