Justia Massachusetts Supreme Court Opinion Summaries

Articles Posted in Consumer Law
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Plaintiffs refinanced their home in a mortgage loan transaction with Summit Mortgage. The mortgage was later assigned to Defendant, SunTrust Mortgage, Inc. Facing foreclosure, Plaintiffs filed for Chapter 13 bankruptcy. Plaintiffs filed an adversary proceeding against SunTrust in the pending bankruptcy case, seeking rescission of the loan transaction and damages. SunTrust filed a motion for summary judgment, arguing that because Plaintiffs filed their adversary complaint more than four years after the mortgage loan transaction, the defensive rescission-by-way-of-recoupment claim was barred by section 10(f) of the Massachusetts Consumer Credit Cost Disclosure Act (“MCCCDA”). In response, Plaintiffs asserted that the four-year statute of limitations did apply to their action because section 10(i)(3) of the MCCCDA allows for recoupment claims at any time. The United States Bankruptcy Court for the District of Massachusetts certified a question of law to the Massachusetts Supreme Judicial Court, which answered by holding that a borrower who grants a mortgage in a consumer credit transaction may not rescind the transaction under the MCCCDA defensively by way of common law recoupment after the expiration of the statute of limitations set forth in section 10(f) of the MCCCDA.View "May v. Suntrust Mortgage, Inc." on Justia Law

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Plaintiff filed a consumer telephone service complaint against Verizon New England. The Department of Telecommunications and Cable eventually dismissed Plaintiff's claim as moot because, during the course of the proceedings, Plaintiff's customer relationship with Verizon had been terminated. On appeal, a single justice dismissed Plaintiff's complaint because it failed to comply with the timely filing requirements of Mass. Gen. Laws ch. 25, 5. Plaintiff appealed to the full court. The Department subsequently afforded Plaintiff a renewed opportunity to pursue a timely appeal under Mass. Gen. Laws ch. 25, 5, and Plaintiff chose to do so. The Supreme Court (1) affirmed the ruling of the single justice that Mass. Gen. Laws ch. 25, 5 governs appeals from final orders issued by the Department; and (2) declared the remainder of the matter moot because Plaintiff filed a new petition for judicial review within the time period required by Mass. Gen. Laws ch. 25, 5. Remanded. View "Olmstead v. Dep't of Telecommunications & Cable" on Justia Law

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Karl McGhee, a financial advisor at LPL Financial, acted as financial planner for Plaintiff. Plaintiff filed a complaint against McGhee and LPL, asserting claims for, inter alia, violations of Mass. Gen. Laws ch. 93A. Defendants moved for an order compelling the parties to proceed to arbitration due to an arbitration agreement signed by Plaintiff. The motion judge denied the motion, concluding that none of Plaintiff's claims could be compelled to arbitration because claimants under chapter 93A, section 9 are not required to submit to arbitration. The Supreme Court reversed, holding (1) claims alleging an unfair or deceptive trade practice in violation of chapter 93A, section 9 must be referred to arbitration where the contract involves interstate commerce and the agreement is enforceable under the Federal Arbitration Act (FAA); and (2) because Plaintiff and Defendants in this case entered into a valid contract whereby they agreed to settle all controversies related to Plaintiff's financial account by arbitration, and because the arbitration agreement was governed by the FAA, Defendants as a matter of law were entitled under the FAA to a stay of judicial proceedings and an order compelling arbitration. Remanded. View "McInnes v. LPL Fin., LLC" on Justia Law

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Plaintiffs refinanced their home through Lender. The monthly payment on the loan was $600 greater than Plaintiffs' total monthly income. After the mortgage was funded, it was sold and assigned to Bank. Servicer serviced the loan. After Plaintiffs defaulted on the loan, Bank foreclosed on the mortgage. Plaintiffs subsequently brought this action asserting violations of the Consumer Protection Act, the Predatory Home Loan Practices Act, and the Borrower's Interest Act, and asserting that the loan was unenforceable because it was unconscionable. A superior court judge granted summary judgment to Defendants, Bank and Servicer, on all claims based on the ground that Defendants, as assignees, had no liability for the acts of Lender. The Supreme Court (1) reversed summary judgment in favor of Bank, holding that Bank was not shielded from liability as a matter of law by virtue of its status as an assignee and that Bank failed to establish the absence of material issues of disputed fact entitling it to judgment on any individual claim; and (2) affirmed summary judgment in favor of Servicer because Servicer was not shown to be an assignee and Plaintiffs offered no alternative basis on which Servicer might be held liable. Remanded. View "Drakopoulos v. U.S. Bank Nat'l Ass'n" on Justia Law

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Plaintiffs commenced a putative class action against Defendant, alleging violations of Mass. Gen. Laws ch. 93A. Dell successfully moved to compel arbitration according to an arbitration agreement signed by the parties. An arbitrator concluded that the parties waived class action relief by signing the agreement. In Feeney I, the Supreme Court invalidated the class waiver provision in the arbitration agreement. In this subsequent appeal, the Supreme Court held that the arbitration agreement was properly invalidated where (1) Mobility LLC v. Concepcion, decided by the U.S. Supreme Court after Feeney I, precluded the invalidation of class waiver provisions in arbitration clauses in consumer contracts, such as the one at issue here, and therefore, Concepcion undid the principal rationale for the Court's decision in Feeney I; (2) a court is not foreclosed from invalidating an arbitration agreement that includes a class action waiver where a plaintiff can demonstrate he effectively cannot pursue a claim against the defendant in individual arbitration according to the terms of his agreement, thus rendering his or her claim nonremediable; and (3) Plaintiffs demonstrated that they could not pursue their statutory claim under the individual claim arbitration process required by the arbitration agreement. View "Feeney v. Dell Inc." on Justia Law

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In 2001, Plaintiff, a special education student at a public elementary school in the town of Duxbury, fell and sustained injuries while unsupervised at school. Plaintiff presented a claim to the town based on her injuries. The Massachusetts Insurers Insolvency Fund, an association that settles unpaid claims covered by an insurance policy issued by an insurer that later becomes insolvent, made no offer to settle Plaintiff's claim despite its obligation to defend the town. Plaintiff subsequently commenced a consumer action against the insolvency fund. The superior court allowed the insolvency fund's motion for judgment on the pleadings. The Supreme Court decided that the insolvency fund was subject to consumer actions and remanded the case. The parties subsequently settled Plaintiff's negligence claim. A superior court judge ruled that Plaintiff was entitled to attorney's fees, a decision the insolvency fund appealed. The Supreme Court affirmed, holding that where, as here, a plaintiff prevails in a consumer action against the insolvency fund under the consumer protection act, the insolvency fund is liable for reasonable attorney's fees. View "Wheatley v. Mass. Insurers Insolvency Fund" on Justia Law

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Employees of Michaels Stores, Inc. request and record customers' zip codes in processing credit card transactions. Plaintiff, a customer of Michaels, filed an action on behalf of herself and a putative class of Michaels customers in the federal district court, alleging that Michaels unlawfully writes customers' personal identification information on credit card transaction forms in violation of Mass. Gen. Laws ch. 93, 105(a) (the statute). The Supreme Court accepted certification to answer questions of state law and held (1) a zip code constitutes personal identification information for purposes of the statute; (2) a plaintiff may bring an action for violation of the statute absent identity fraud; and (3) the term "credit card transaction form" in the statute refers equally to electronic and paper transaction forms. View "Tyler v. Michael Stores, Inc." on Justia Law

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Plaintiffs brought an action against defendant, seeking a refund of two cruise tickets they purchased and cancelled, and damages under G.L.c. 93A for unfair and deceptive trade practices. The court concluded that the evidence at trial plainly established that defendant violated the Attorney General's travel service regulations in two respects: fist, it failed to disclose the refund policy; and second, having violated the disclosure statement, it failed to refund the payments made by a cancelling customer within thirty days. These violations qualified as unfair or deceptive acts, and they caused plaintiffs a loss: the lack of a prompt refund of the ticket price. The court also concluded that plaintiffs' demand letter satisfied the requirements of G.L.c. 93A, section 9(3). The purposes of the demand letter were sufficiently fulfilled where it constituted fair notice of the claim and enabled defendant to make a reasonable tender of settlement. Accordingly, the judgment for defendant on plaintiffs' claims was reversed and the case remanded for the entry of judgment for plaintiffs and for determination of their damages, reasonable attorneys' fees, and costs. View "Casavant & another v. Norwegian Cruise Line Ltd." on Justia Law