US Supreme Court: FAA Preempts Discover Bank Rule
The U.S. Supreme Court today issued its opinion in AT&T Mobility LLC v. Concepcion, reversing the Ninth Circuit opinion below and holding that California's Discover Bank rule is preempted by the Federal Arbitration Act, 9 U.S.C. § 2 ("FAA").
In Concepcion, plaintiffs filed suit in federal district court alleging false advertising and fraud, asserting AT&T charged sales tax on cellular telephones advertised as "free." AT&T moved to compel arbitration. The district court denied the motion, citing Discover Bank v. Superior Court, 26 Cal.App. 4th 148 (2005), which held class action waivers in most consumer arbitration agreements are unconscionable, and therefore subject to the FAA's savings clause and not preempted. The Ninth Circuit affirmed.
Continue Reading...Fed Finalizes Rules to Expand TILA Disclosures
The Federal Reserve has issued a final rule amending Regulation Z to implement provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act that would expand the coverage of consumer protection regulations to credit transactions and leases of higher dollar amounts.
Among other things, the final rules expand TILA's credit disclosure requirements to credit transactions up to $50,000 (up from $25,000) and prohibit creditors from engaging in certain practices with respect to those loans. Private education loans and mortgages are subject to TILA regardless of the transaction amount.
