4th Circuit vacates $10.6 million judgment, orders district court to reevaluate class standing

Courts State Issues Settlement Appellate Fourth Circuit U.S. Supreme Court Class Action West Virginia

On October 28, the U.S. Court of Appeals for the Fourth Circuit remanded a $10.6 million damages award it had previously approved in light of the U.S. Supreme Court’s decision in TransUnion LLC v. Ramirez. As previously covered by InfoBytes, in January, the Supreme Court vacated the judgment against the defendants and ordered the 4th Circuit to reexamine its decision in light of TransUnion (which clarified the type of concrete injury necessary to establish Article III standing, and was covered by InfoBytes here). Previously, a divided 4th Circuit affirmed a district court’s award of $10.6 million in penalties and damages based on a summary judgment that an appraisal practice common before 2009 was unconscionable under the West Virginia Consumer Credit and Protection Act (covered by InfoBytes here). During the appeal, the defendants argued that summary judgment was wrongfully granted and that the class should not have been certified since individual issues predominated over common ones, but the appellate court majority determined, among other things, that there was not a large number of uninjured members within the plaintiffs’ class because plaintiffs paid for independent appraisals and “received appraisals that were tainted.” At the time, the 4th Circuit “concluded that the ‘financial harm’ involved in paying for a product that was ‘never received’ was ‘a classic and paradigmatic form of injury in fact.’” On remand, the 4th Circuit considered questions of standing and ultimately determined that TransUnion requires the district court to reevaluate the standing of class members.