Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

Smith sued under the Fair Debt Collection Practices Act, 15 U.S.C.1692g(a)(3). GC’s debt-collection letter stated: If you dispute this balance or the validity of this debt, please let us know in writing. If you do not dispute this debt in writing within 30 days after you receive this letter, we will assume this debt is valid. The Act does not say how a consumer may dispute a debt’s validity. Smith argued that the consumer is entitled to choose how to dispute. In an earlier appeal, the Seventh Circuit held that GC had waived any entitlement to arbitrate the dispute. The district court then held that Smith had not established injury and dismissed the suit.The Seventh Circuit affirmed, without addressing whether a debt collector violates section 1692g(a)(3) by telling consumers to put disputes in writing. Smith did not allege injury, because she did not try to show how a dispute would have benefitted her. Smith does not contend that the letter’s supposed lack of clarity led her to take any detrimental step, such as paying money she did not owe. She is no worse off than if the letter had told her that she could dispute the debt orally. The requirement of injury-in-fact is an essential element of standing, regardless of whether the asserted violation is substantive or procedural. View "Smith v. GC Services Limited Partnership" on Justia Law

Clearview's facial recognition tool takes advantage of public information on the Internet. Clearview uses a proprietary algorithm to “scrape” pictures from social media sites such as Facebook, Twitter, Instagram, LinkedIn, and Venmo. Clearview’s software harvests from each scraped photograph the biometric facial scan and associated metadata (time and place stamps); that information is put onto its database, which is stored on servers in New York and New Jersey. Clearview offers access to this database for users who wish to find out more about someone in a photograph. Many of its clients are law-enforcement agencies. The New York Times published an article about Clearview.This putative class action asserted violations of Illinois’s Biometric Information Privacy Act, 740 ILCS 14/15. After its removal to federal court, the district court remanded the case to state court, stating that the complaint alleged only a bare statutory violation, not the kind of concrete and particularized harm that would support Article III standing in federal court. The Seventh Circuit affirmed. In alleging a violation of a general rule that prohibits the operation of a market in biometric identifiers and information, the complaint described only a general, regulatory violation, not something that is particularized to the plaintiffs and concrete. It alleged no particularized injury resulting from the commercial transaction. View "Thornley v. Clearview AI, Inc." on Justia Law

Prairie sued Coyle in Illinois state court concerning the replacement of valves purchased by Prairie. Coyle's insurer, Federated, sought a declaration that it had no duty to defend or indemnify Coyle in that suit. After Coyle answered Federated’s complaint, Federated moved for judgment on the pleadings. Coyle opposed the motion and later moved for leave to file supplemental briefs to show that the state-court action potentially fell within Federated’s coverage obligations. The district court denied Coyle’s motions to file supplemental briefs and granted Federated judgment on the pleadings. The court ruled that Prairie’s complaint did not allege “property damage” or an “occurrence” because Prairie only sought damages for the repair and replacement of defective products—purely economic losses. Prairie’s counsel had clarified at a discovery hearing that “Prairie was not making a claim for loss of use but rather for the costs of replacing the allegedly defective valves and the associate piping” and the defectiveness of the valves was foreseeable.The Seventh Circuit reversed. In granting Federated’s motion, the court relied on some of the new facts that Coyle had unsuccessfully moved to introduce through supplemental briefs while ignoring other facts. The court’s handling of the case ran afoul of local rules and the Federal Rules of Civil Procedure and deprived Coyle of its right to present material factual evidence bearing on the central issue in the case. View "Federated Mutual Insurance Co. v. Coyle Mechanical Supply Inc." on Justia Law

Hill filed suit in state court, asking a judge to compel Young, his prison’s warden, to mail two complaints that Hill wanted to file in federal court. The defendants removed Hill’s suit to federal court. The district judge dismissed the complaint, observing that its records showed that the two complaints at issue had been filed.At Hill’s request, the Seventh Circuit vacated language from the judgment: “This dismissal shall count as one of [Hill’s] allotted ‘strikes’ under" 28 U.S.C. 1915(g). This statute provides: In no event shall a prisoner bring a civil action or appeal ... under this section if the prisoner has, on 3 or more prior occasions, while incarcerated or detained ... brought an action or appeal in a court of the United States that was dismissed" as frivolous, malicious, or failing to state a claim unless the prisoner is under imminent danger of serious physical injury.Section 1915(g) requires prepayment of the docket fees only if the plaintiff has thrice “brought an action or appeal in a court of the United States” decided on one of the listed grounds. Hill did not “bring” this suit in a court of the United States. Defendants brought it to federal court under 28 U.S.C. 1441(a). This suit does not count as a “strike.” While the comment is dicta and is not binding in future litigation, it aggrieves Hill by drawing a future judge’s attention to this suit. View "Hill v. Madison County" on Justia Law

In 2012, Laducer, a truck driver, rear-ended Spinnenweber’s minivan. Spinnenweber refused medical treatment at the scene. He later sought treatment for neck pain, tinnitus, and bouts of short-term memory loss. Spinnenweber sued Laducer and Laducer’s employer, seeking compensatory damages for his physical injuries. He did not seek punitive damages, medical costs, or lost wages, nor did he claim psychological or emotional injuries. Defendants conceded liability. The defendants’ medical expert, Dr. Carney, was the only expert that Spinnenweber relied on. He testified that Spinnenweber “clearly had a whiplash injury” from the crash. “He certainly could’ve had a very mild concussion.” Dr. Carney did not connect the alleged memory loss or the tinnitus to the accident. Spinnenweber’s counsel stated during closing arguments that the purpose of tort law "is to deter bad conduct so it doesn’t repeat.”The jury awarded Spinnenweber $1 million in compensatory damages. The court offered Spinnenweber the choice of accepting $250,000 or a new trial. Spinnenweber declined to accept the remittitur award. His attorney withdrew. After a one-day bench trial, Spinnenweber requested an award of $0 in damages, calling it a “verdict of silence.” The Seventh Circuit affirmed. The court did not abuse its discretion by finding that Spinnenweber’s evidence showed that he potentially suffered just whiplash and a mild concussion or by finding that the $1 million verdict was so outrageous that it warranted remittitur or a new trial. “Spinnenweber was hoisted with his own petard.” View "Spinnenweber v. Laducer" on Justia Law

The Spuhlers incurred medical debts that State Collection sought to collect on behalf of the medical‐care provider. The collector sent the Spuhlers dunning letters that provided the debts’ sums but lacked a statement that interest would accrue on the debts. The Spuhlers, who sought to represent a class of consumers, filed a complaint under the Fair Debt Collection Practices (FDCPA), arguing that the omission of a statement that the debt amounts would increase from the accrual of interest made the letters’ account of the debts was misleading, 15 U.S.C. 1692e(2), 1692f. A magistrate granted the Spuhlers summary judgment and certified a class.The Seventh Circuit vacated. At the summary judgment stage of litigation, to demonstrate Article III standing to sue for an alleged violation of the FDCPA, the plaintiffs must “‘set forth’ by affidavit or other evidence ‘specific facts’” demonstrating that they have suffered a concrete and particularized injury that is both fairly traceable to the challenged conduct and likely redressable by a judicial decision. The plaintiffs here did not carry that burden. View "Spuhler v. State Collection Service, Inc." on Justia Law

Finance sent Bazile a letter seeking to collect medical debts. The dunning letter stated the date (September 19, 2017) and the total balance of the debt ($92.23), without indicating whether that amount may increase with the accrual of interest. Bazile filed suit, alleging that the letter’s exclusion of information concerning the accrual of interest was a violation of the Fair Debt Collection Practices Act (FDCPA) because the letter was misleading and did not provide “the amount of the debt,” 15 U.S.C. 1692g(a)(1), 1692e. The district court concluded that Bazile had Article III standing.The Seventh Circuit remanded for findings of fact. The complaint may survive dismissal as a matter of pleading but that’s not enough for the district court to decide the merits of the action. While Bazile’s allegations support an inference that interest was accruing on the debt, the defendant asserted that interest was not accruing and questioned whether the letter’s omission of information about interest affected Bazile’s response to the correspondence or to the debt. Facts necessary for standing have been called into doubt, requiring further inquiry into whether the court has subject‐matter jurisdiction, requiring an evidentiary hearing on the defendant’s motion to dismiss. View "Bazile v. Finance System of Green Bay, Inc." on Justia Law

When the Gunn's debt for homeowners' association assessments reached $2,000, the association hired a law firm, which sent the Gunns a letter demanding payment. The letter states: If Creditor has recorded a mechanic’s lien, covenants, mortgage, or security agreement, it may seek to foreclose such mechanic’s lien, covenants, mortgage, or security agreement. The Gunns did not pay. The law firm filed suit in state court, seeking damages for breach of contract rather than foreclosure. The Gunns filed suit under the Fair Debt Collection Practices Act (FDCPA), which forbids false or misleading statements in dunning letters, 15 U.S.C. 1692e(2), (4), (5) & (10). The Gunns acknowledge that the statement is true but contend that it must be deemed false or misleading because the law firm would have found it too costly to pursue foreclosure to collect a $2,000 debt.The Seventh Circuit ordered the dismissal of the suit for lack of jurisdiction. The contested sentence did not injure the Gunns. They argued that they were annoyed or intimidated but did not contend that the letter was a forbidden invasion of privacy. The association and its law firm were entitled to communicate with them, If annoyance were enough, the very fact that a suit was filed would show the existence of standing. The asserted violation of a substantive FDCPA right does not guarantee standing. There must still be a concrete injury. View "Gunn v. Thrasher, Buschmann & Voelkel, PC" on Justia Law

Convergent sent Brunett a letter demanding repayment of a debt that slightly exceeded $1,000, offering to accept 50% of the balance in satisfaction of the debt. The letter stated that, if the creditor ended up forgiving more than $600, it would be required to report the release of indebtedness to the IRS, because federal law treats as taxable income a loan that is not repaid. Brunett sued, arguing that the statement about the IRS violates the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692e(5), (10), because it threatens action that cannot legally be taken and amounts to a false representation.The Seventh Circuit ordered the dismissal of the suit for lack of jurisdiction after noting that the statement was not false. Brunett conceded that the letter had not injured her. She did not pay anything; the statement did not affect her credit rating or discourage anyone from doing business with her. A plaintiff who lacks a concrete injury cannot sue under the FDCPA. The state of confusion is not itself an injury. “If it were, then everyone would have standing to litigate about everything.” That Brunett’s confusion led her to hire a lawyer and that she felt "intimidated" do not change the evaluation. View "Brunett v. Convergent Outsourcing Inc." on Justia Law

The plaintiffs received collection letters from Finance System, seeking payment of medical debts. Represented by the same law firm, they filed materially identical class-action claims under the Fair Debt Collection Practices Act, 15 U.S.C. 1692, alleging the use of false, deceptive, or misleading representations, or otherwise unfair or unconscionable methods to collect a debt. They cited the letters’ statement that: “You want to be worthy of the faith put in you by your creditor …. We are interested in you preserving a good credit rating with the above creditor.” The Seventh Circuit affirmed the dismissal of the claims, reasoning that the plaintiffs have not alleged any injury, or even an appreciable risk of harm, from the alleged statutory violations and, therefore, lack standing. View "Sandri v. Finance System of Green Bay, Inc." on Justia Law