b'For more information, please visit www.lenderlawwatch.com or www.enforcementwatch.comCAFA. In Home Depot U.S.A., Inc. v. Jackson, 139 S. Ct.Cy Pres and Standing. In Frank v. Gaos, 139 S. Ct. 1401 1743 (No. 17-1627, May 28, 2019), the Supreme Court(No. 17-961, March 20, 2019), the Supreme Court re-held that third party counterclaim defendants may notmanded a case back to the Ninth Circuit on a standing remove class actions from state to federal court. Citi- issue, rather than resolve the cy pres dispute for which bank had filed a debt-collection case against an indi- it had granted certiorari. The plaintiff in the original Major U.S. Supreme Court + Appellatevidual, George Jackson, claiming he owed money on amatter filed a class action lawsuit against Google for Citibank-issued Home Depot credit card. Jackson filedprivacy violations arising from Googles alleged practice a counterclaim against Citibank and a third party classof transmitting search results to the websites that are Cases Decided in 2019action counterclaim against Home Depot USA, Inc. andlinked in user searches. Ultimately, the parties nego-Carolina Water Systems. Jackson contended that Hometiated settlement in which Google agreed to provide 2019 brought a variety of U.S. Supreme Court and Courts of Appeals decisions touching many aspectsDepot and Carolina Water engaged in unfair tradedisclosures to users and distribute approximately six relevant to the consumer finance industry.Issues on appeal ranged from the FDCPA to the Class Actionpractices by inducing customers to buy water treatmentmillion dollars to cy pres recipients, with no money Fairness Act (CAFA). systems at inflated prices. Citibank ultimately dismissedgoing to absent class members. Two absent class its claims against Jackson, and Home Depot attemptedmembers intervened and objected to the settlement, to remove the case to federal court under the CAFA. Inprimarily arguing that paying only cy pres recipients, HIGHLIGHTS es for its ruling. First, it focused on the third sentence ofhis motion to remand, Jackson argued that third partynamed plaintiffs, and plaintiffs attorneys was improper. Supreme Court section 1692a(6), which defines a debt collector. Spe- counterclaim defendants were not permitted to do so.After the Ninth Circuit affirmed, the objectors petitioned cifically, that section provides what the Court referredThe District Court granted the remand, and the Fourthfor certiorari to the Supreme Court on the cy pres issue. FDCPA. On March 20, 2019, the Supreme Court held into as a limited-purpose definitionFor the purpose ofCircuit affirmed. Its ruling was based in part on a nearlyThe Center for Constitutional Jurisprudence, Cato Insti-Obduskey v. Wells Fargo, 139 S. Ct. 1029, (No. 17-1307),section 1692f(6) [the] term [debt collector] also includes80 year-old precedent that supported Jacksons argu- tute, Center for Individual Rights, and Attorney General that non-judicial foreclosures are not subject to theany person . in any business the principal purpose ofment. In Shamrock Oil & Gas Corp. v. Sheets, 313 U.S.of Arizona, in a brief joined by 15 other states, filed FDCPA. This case resolved a circuit split in which thewhich is the enforcement of security interests. Because100 (No. 727, April 28, 1941), the Court previously heldamicus curiae briefs in support of certiorari. Although Ninth and Tenth Circuits held that the FDCPA did notthat portion of the definition, which makes clear that itthat even if a counterclaim would otherwise be sub- the Court granted certiorari, it ultimately focused on apply in the non-judicial foreclosure context, and thealso refers to non-judicial foreclosure agents like McCa- ject to federal jurisdiction, the counterclaim defendantstanding issues under Spokeo, Inc. v. Robins, 136 S. Ct. Third, Fourth, and Sixth Circuits found that it did. Therthy, is limited only to section 1692f(6), the Court foundcannot remove, because the primary parties determine1540 (No. 13-1339, May 16, 2016), which was decided Supreme Court resolved the issue when it held thatthat the rest of the definition excluded those entities.original jurisdiction. As to the Jackson case, the ap- while Gaos was on appeal in the Ninth Circuit. After businesses that solely enforced their security inter- Second, the Court found that, Congress may well havepellate court held that neither 28 U.S.C.1441(a) nororal argument, the Court ordered the parties to file a ests through non-judicial foreclosure were not debtchosen to treat security-interest enforcement differently1453(b) (CAFAs removal provision) permit third party de- supplemental briefing addressing whether any named collectors, as defined by the FDCPA. In Obduskey, afrom ordinary debt collection in order to avoid conflictsfendants to remove class actions. In its ruling affirmingplaintiff has standing such that the federal courts have Colorado homeowner who defaulted on his mortgagewith state nonjudicial foreclosure schemes. Third, thethe Fourth Circuit, the Supreme Court held that the civilArticle III jurisdiction over this dispute. After briefing, challenged the right of an agentin this case, law firmCourt looked at the legislative history of the FDCPA,action in which the district court must have originalthe Court vacated the Ninth Circuits ruling and sent the McCarthy & Holthuscarrying out non-judicial foreclo- which indicated that Congress had originally includedjurisdiction is that of the original plaintiff(s) and defen- matter back to the District Court to resolve the issue of sure on behalf of the mortgagee, Wells Fargo Bank,any person who engages in any business the principaldant(s); and looking at legislative history, Congress didstanding in light of Spokeo. However, the Court advised N.A., when the borrowers demands for verification ofpurpose of which is the collection of any debt or en- not intend, the defendant or the defendants in 1441(a)that, [n]othing in our opinion should be interpreted as the debt pursuant to 15 U.S.C.1692g(b) were ignored.forcement of security interests in the broader defini- to include third party counterclaim defendants. Theexpressing a view on any particular resolution of the Obduskey filed suit in Colorado District Court, alleging,tion, but later rejected it. In its holding, the Court madeCourt was split 5-4 in its decision, with the opinion writ- standing question. The Court may ultimately, through among other claims, that McCarthy had violated the FD- clear that non-judicial foreclosure entities do not haveten by Justice Thomas. The implications of this rulingone case or another, determine whether cy pres CPA. The District Court dismissed on the grounds thatfree reign to act as they please:[t]his is not to suggestare that a plaintiff can prevent a defendant from remov- awards are fair to absent class members, and wheth-McCarthy was not a debt collector as defined withinthat pursuing nonjudicial foreclosure is a license toing a class action to federal court if the plaintiff assertser they violate the First Amendment, as some have the meaning of the FDCPA, and Obduskey appealed toengage in abusive debt collection practices.enforcingthe class claims as a counterclaim in a pre-existing law- argued that they implicitly compel class plaintiffs to the Tenth Circuit. On appeal, the Tenth Circuit affirmed,a security interest does not grant an actor blanket im- suit. The risk of exposure to state class-action litigationsupport unaffiliated charities without consent.holding that, the mere act of enforcing a security inter- munity from the Act. In other words, while non-judicialhas led more businesses to use arbitration clauses thatCourts of Appealest through a non-judicial foreclosure proceeding doesforeclosures are generally not subject to the FDCPAbar class adjudication. CAFA mitigated that somewhat, not fall under the FDCPA. Obduskey v. Wells Fargo,(other than section 1692f(6)), abusive practices that gobut potential counterclaim or third-party defendants canEleventh Circuit Allows Miamis Tax Reduction Claim 879 F.3d 1216, 1223 (2018). The Supreme Court grantedbeyond traditional foreclosure practices may receiveno longer count on CAFA and may look to arbitrationto Proceed Under the Fair Housing Act. In a unani-certiorari, due to the different views among the Circuitsdifferent treatment from the courts. The Courts rulingagain. mous published opinion, the Eleventh Circuit, in City of about application of the FDCPA to nonjudicial foreclo- was unanimous, and Justice Thomas wrote the opinion.Miami v. Wells Fargo & Co, et al., (No. 14-14544) (May 3, sure proceedings. The Supreme Court had three bas- 2019), found that Miami could maintain its lawsuit alleg-ing that banks discriminatory foreclosure practices cost 40 41'