Presentation on theme: "Consumer Protection Laws Drama in the law Car sales in Bastra."— Presentation transcript:
Consumer Protection Laws Drama in the law Car sales in Bastra
Consumer Credit Protection Equal Credit Opportunity Act Fair Credit Reporting Act – If denied credit based on report – consumer must be notified – Reporting agency must investigate consumer reports of inaccurate information – Consumer can file 100 word rebuttal – Who has access to credit reports? – What about other types of reports? Prior litigation records, for instance. Fair and Accurate Credit Transaction Act (FACT) – Right to see your report – Credit card receipts truncated – Rules on disposing of sensitive information Annual Credit Report https://www.annualcreditreport.com/cra/index.jsp
Truth-in-Lending Act Regulation Z $50 maximum loss Strictly construed against lender why? Purtle v. Eldridge – Purtle bought a car from Eldridge on credit. She lied on the credit application about her job status. Eldridge failed to disclose the finance charge, the annual percentage rate, or the total sales price in violation of the TILA. What happens? “Reg Z” box – Required for Loans Subject to TILA Carlisle v. Whirlpool Financial – Door-to-door sales of satellite dishes. Cost $1,100 but could pay $200 down and finance the rest (avail. elsewhere for $199). Financial terms not disclosed in accordance with Truth-in-Lending Law – plaintiffs awarded $581 million.
Credit Card Disclosure Rules Fees and APR in bold Key terms highlighted in a table – similar to Reg Z box Periodic statements easier to read Account changes must be displayed in a box near the top Law also limits when credit card companies can increase rates Changes to terms must give 45 day notice – can opt out if do not agree with the changes Protects against due date practices Outlaws banks giving away promotional items on college campuses
Fair Debt Collections Practices Act – Contacting the debtor at the debtor’s place of business – Contacting the debtor at an inconvenient time – Contacting third parties – Using harassment or intimidation – Communicating with the debtor at any time after receiving notice that the debtor is refusing to pay the debt – Validation Notice (30 days to dispute) – Only applies to “debt collectors”
Telemarketing $600 Billion sales volume 4 million employees 100 million calls a day Direct Marketing Activities Telemarketing Regulated by state and federal law Telephone Consumer Protection Act – Prohibits automated dialing machine or – Pre-recorded voice – Fax advertising limited Telemarketing and Consumer Fraud and Abuse Prevention Act of 1994 – Applies to most telemarketing – Requires Inform recipient that the call is a sales call Identify seller’s name and the product Inform of total cost Other sales conditions – i.e. whether it’s final or non-refundable – $10,000 per violation penalty – Private parties may bring suit in Federal court if they have suffered more than $50,000 in damages Must provide caller ID information Why is it significant that a private party can bring an action, who else would?
Presentation Case: Omega World Travel (P) v. Mummagraphics, Inc. (D) (4 th Cir 2006), p Groups 10 & 7 Omega World Travel Mummagraphics, Inc.v. 800 start here Thursday – do Patrick’s case firsty
Direct Marketing Activities Do Not Call List National Do Not Call List started in 2003 – 1991 Telephone Consumer Protection Act – Court struck down the list based on lack of authority – according to the judge the FCC, not the FTC should have developed the list. – 1994 Telemarketing and Consumer Fraud and Abuse Prevention Act – Rep Billy Tauzin joked “[the] law should be called “This time we really mean it act.” Five year limit – so names are beginning to be purged as of Sept 15, 2007, 2012, 2017 next year to reapply (set in place to help with people who move or change numbers) Exempt – politicians, non-profits Not Businesses. Businesses cannot sign up Businesses That Call – must check list. Ok to call if business relationship in past 18 months Cell Phones?
SPAM laws – CAN-SPAM ACT of 2003 Commercial . Act covers whose primary purpose is advertising – that facilitates an agreed-upon transaction or updates an existing customer is exempt (although it cannot be false or misleading) Main provisions: – Bans false or misleading headers. The From and To line must be acurate. – Bans deceptive subject line. – Requires opt-out method – Requires a valid physical address Do Not Legislation. The FTC commissioned a 60 page study that concluded a do not list is not feasible at this time.
What about this one?
Does this violate CAN-SPAM? WHY?
Presentation Case - Home Solicitations Rossi v. 21 st Century Concepts, Inc., p. 303 Groups 8 & 13
Home Solicitations – 3 day cooling off rule – Location Home Hotel Fairground Convention Unsolicited merchandise 900 Numbers – Disclose name – The cost of the call in the introductory message – Opportunity to hang up without charge Warranties. - covered in separate chapter More Consumer Protection Laws End of Chapter Q: 8: Hantske v. Brandenburger Facts: Fred Hantske Jr was telephoned by Brandenburger & Davis and told he was a possible heir to an estate. They agreed to meet in Hantske’s home to discuss and Hantske agreed to give Brandenburger 25%. Hanske got $30,000 ($7,500 = 25%) and cancelled the contract. Case Illustration 8.3 Kamposkek v. Johnson Home improvement Builder did not give notice Buyer cancels contract
Labeling and Packaging Regulation Heavily regulated Fair Packaging and Labeling Act of 1966 – Identify product – Identify quantity Federal Cigarette Labeling and Advertising Act of 1965 (warnings – modified by at least 3 more acts) Made in USA Labeling (all or virtually all for FTC – NAFTA = at least 55% from US, Canada or Mexico) 1990 Nutrition Labeling and Education Act
Food Drug and Cosmetics Laws Food purity regulated 1990 Nutrition Labeling and Education Act The FDA's action level for peanut butter is 30 or more insect fragments or one or more rodent hairs per 100 grams.
Dangers to Children Ban dangerous products Recall dangerous products Mattel voluntarily recalled this toy in August of 2007 because the Chinese company that made it used lead paint to save money An estimated 6,100 people have been treated in hospital emergency rooms for injuries involving lawn darts from 1978 through present. At least 80 percent of the victims were younger than 15 years old, and more than 50 percent were ten years old or younger. More than half of the victims had injuries to the skull, eye, ear or face. Example of Recall
Consumer Product Safety Improvement Act. Lead testing for wood toys? $300-$4,000 per toy. Bikes? Books?
Dangers to Everyone Mirama Juicer - Consumer told Mirama that “juicer suddenly exploded, throwing with great violence pieces of the clear plastic cover and shreds of the razor sharp separator screen as far as eight feet in my kitchen.” Mattel Article re: informing FTC Ford Explorer and Firestone. In 2000, Firestone recalled 14.4 Million Tires 10 years after first lawsuit filed against Ford based on the Explorer 119 Deaths Juicer – Not Mirama
Using Consumer Protection as a Sword ATVs. Polaris, Honda & Suzuki are lobbying Congress to require safety standards (after losing 40% of the market to cheaper Chinese and Taiwanese imports). Wireless. Yahoo, Google support open market – AT&T and Verzion like closed system giving them control over their infrastructure Credit Card Fees. Claim high interchange fees are bad for consumers
Presentation Case, Gonzalez (P) v. Kay (D), (Fth Cir 2009), p Groups 6 & 3