The U.S. Consumer Financial Protection Bureau (CFPB) proposed a new rule in 2016 restoring consumers’ right to sue banks, credit card companies and consumer lenders in class actions.<\/p>\n
The CFPB’s rule<\/a>, proposed under the Dodd-Frank Wall Street Reform and Consumer Protection Act, restricts the financial firms’ practice of using the fine print in consumer contracts to prevent them from proceeding in a class action by way of\u00a0arbitration clauses.”<\/p>\n Class actions are important because they permit consumers to sue as a group for damages that are\u00a0often too small to justify suing individually.\u00a0 For example, if a\u00a0bank overcharges a customer by $1,000, few lawyers would be willing to accept that consumer’s case because the cost to sue would be far higher than any money they could recover.\u00a0 Class actions solve that problem by giving\u00a0consumers the right to sue on behalf of GROUPS OF consumers.\u00a0 Those groups of consumers\u00a0have all suffered the same injury, making the collective amount in dispute large enough to justify the expense of hiring\u00a0lawyers and experts needed to pursue the class action lawsuit.<\/p>\n As reported in a New York Times investigation (Arbitration Everywhere, Stacking the Deck of Justice<\/a>), two Supreme Court decisions permitted financial firms to exempt themselves from class actions.\u00a0 The court allowed the firms to add “arbitration clauses” to the fine print of their contracts that waived consumers’ right to sue as a class action.<\/p>\n Those cases were:\u00a0\u00a0 AT&T Mobility v. Concepcion<\/em><\/span>, 563 U.S. 333 (2011) and American Express Co. v. Italian Colors Restaurant<\/em><\/span>, 133 S. Ct. 2304 (2013).\u00a0 Since consumers have virtually no bargaining power with their bank or credit card company, these contracts are typically “take it or leave it.”\u00a0 If the consumer wants the product or service, he or she has no\u00a0alternative other than to accept these “arbitration clauses.”<\/p>\n The CFPB’s rule restores consumers’ right to sue in class actions by prohibiting arbitration clauses in certain consumer financial contracts.\u00a0 If you have questions about potential class action claims, feel free to contact Joe Kravec<\/a>, Jim Pietz<\/a> or Wyatt Lison<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" Right to Sue – 2016 CFPB Rule The U.S. Consumer Financial Protection Bureau (CFPB) proposed a new rule in 2016 restoring consumers’ right to sue banks, credit card companies and consumer lenders in class actions. The CFPB’s rule, proposed under the Dodd-Frank Wall Street Reform and Consumer Protection Act, restricts the financial firms’ practice of […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[99],"tags":[739,740,741,742,743,142,472,473,744,745,746],"blocksy_meta":{"styles_descriptor":{"styles":{"desktop":"","tablet":"","mobile":""},"google_fonts":[],"version":6}},"featured_image_urls":{"full":"","thumbnail":"","medium":"","medium_large":"","large":"","1536x1536":"","2048x2048":""},"post_excerpt_stackable":" Right to Sue – 2016 CFPB Rule The U.S. Consumer Financial Protection Bureau (CFPB) proposed a new rule in 2016 restoring consumers’ right to sue banks, credit card companies and consumer lenders in class actions. The CFPB’s rule, proposed under the Dodd-Frank Wall Street Reform and Consumer Protection Act, restricts the financial firms’ practice of using the fine print in consumer contracts to prevent them from proceeding in a class action by way of\u00a0arbitration clauses.” Class actions are important because they permit consumers to sue as a group for damages that are\u00a0often too small to justify suing individually.\u00a0 For example,…<\/p>\n","category_list":"Blog<\/a>","author_info":{"name":"Gail Brown","url":"https:\/\/www.fdpklaw.com\/author\/gbrown\/"},"comments_num":"0 comments","featured_image_urls_v2":{"full":"","thumbnail":"","medium":"","medium_large":"","large":"","1536x1536":"","2048x2048":""},"post_excerpt_stackable_v2":" Right to Sue – 2016 CFPB Rule The U.S. Consumer Financial Protection Bureau (CFPB) proposed a new rule in 2016 restoring consumers’ right to sue banks, credit card companies and consumer lenders in class actions. The CFPB’s rule, proposed under the Dodd-Frank Wall Street Reform and Consumer Protection Act, restricts the financial firms’ practice of using the fine print in consumer contracts to prevent them from proceeding in a class action by way of\u00a0arbitration clauses.” Class actions are important because they permit consumers to sue as a group for damages that are\u00a0often too small to justify suing individually.\u00a0 For example,…<\/p>\n","category_list_v2":"Blog<\/a>","author_info_v2":{"name":"Gail Brown","url":"https:\/\/www.fdpklaw.com\/author\/gbrown\/"},"comments_num_v2":"0 comments","_links":{"self":[{"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/posts\/7040"}],"collection":[{"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/comments?post=7040"}],"version-history":[{"count":3,"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/posts\/7040\/revisions"}],"predecessor-version":[{"id":10980,"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/posts\/7040\/revisions\/10980"}],"wp:attachment":[{"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/media?parent=7040"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/categories?post=7040"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fdpklaw.com\/wp-json\/wp\/v2\/tags?post=7040"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}