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Second Circuit Overturns Credit Card Antitrust Violation
On September 26, the U.S. Court of Appeals for the Second Circuit ruled that a credit card company did not unreasonably restrain trade in violation of the Sherman Act by prohibiting merchants from directing customers to use other, less costly forms of payment. The appeals court reversed based on the lower courts definition of the market as limited to the “core enabling functions provided by networks which allow merchants to capture, authorize, and settle transactions for customers who elect to pay with their credit or charge card.” According to the decision, this definition was too limited in this case, because the credit card network derived its market share from cardholder satisfaction, providing “no reason to intervene and disturb the present functioning of the payment‐card industry.” The court noted that the outcome in this case is different than in previous credit card exclusionary rule cases because here, the payment clearing network and the card issuing function are completely integrated, meaning that the issuer and the network are the same company.
D.C. Circuit Finds District Court Lacks Jurisdiction in Case Alleging Violations of D.C. Consumer Protection Laws
On July 26, the U.S. Court of Appeals for the D.C. Circuit vacated the district court’s ruling, opining that the plaintiffs in a putative class action failed to establish Article III standing to file suit in federal court. Hancock v. Urban Outfitters, Inc., No. 14-7047, WL 3996710 (D.C. Cir. July 26, 2016). In 2013, the consumer plaintiffs filed a complaint alleging that two D.C. retail stores violated the Identification Information Act, D.C. Code § 47-3151 et seq., and D.C. Consumer Protection Procedure Act, D.C. Code § 28-3901 et seq., by requesting the plaintiffs’ zip codes at the time of purchase. The district court dismissed the complaint, concluding that the plaintiffs had failed to state a claim. As such, the district court ruled that it was unnecessary to address the stores’ jurisdictional argument that the plaintiffs failed to plead an injury sufficient for Article III standing. Citing the recent Spokeo v. Robins Supreme Court ruling, the U.S. Court of Appeals for the D.C. Circuit disagreed: “The Supreme Court’s decision in Spokeo thus closes the door on [the plaintiffs’] claim that the Stores’ mere request for a zip code, standing alone, amounted to an Article III injury.” “Because the plaintiffs have not alleged any concrete injury in fact stemming from alleged violations of D.C. law,” the D.C. Circuit held that “the district court lacked jurisdiction to decide the merits of the case.” The D.C. Circuit vacated the district court’s judgment on the merits and remanded with instructions to dismiss the complaint.
CFPB Announces Community Bank Advisory Council Meeting, April 21
On Thursday, April 21, the CFPB will hold its next Community Bank Advisory Council meeting in Washington, DC. According to the April 5 Federal Register publication providing notice of the meeting, both the CFPB’s strategic outlook and elder financial abuse are discussion topics included in the agenda.
CFPB Readies Guidance to Help Prevent Elder Financial Exploitation
On July 13, CFPB Director Richard Cordray delivered remarks at the White House Conference on Aging, expressing the need to protect older consumers in light of recent studies that have found that financial exploitation is the most prevalent form of elder abuse. Accordingly, Cordray revealed that the Bureau intends to issue an advisory “later this year” to assist financial institutions with preventing, recognizing, and reporting elder financial abuse, adding that “[f]inancial institutions are especially well-positioned” to prevent fraud, scams, or theft that victimize seniors.
CFPB And FDIC Develop Spanish-Language Tool To Stop Financial Exploitation of Older Adults
On October 7, the CFPB and the FDIC announced a Spanish-language version of Money Smart for Older Adults, a free financial resource tool intended to prevent the elder financial exploitation that is affecting millions of senior citizens each year. The English-language version, which “includes practical information that can be put to use right away,” was jointly developed by the two agencies last year. The Spanish-language participant/resource guide and power point slides can be downloaded for free at the FDIC’s website, or can be ordered as hard copies on the CFPB’s website.