Consumer Protection Laws

Let’s Simplify Legal Jargon

May 31, 2010 | Peter S. Lubin and Patrick Austermuehle

Consumer contracts need to be simplified.

Our Chicago consumer lawyers handle individual and class action predatory lending, mortgage fraud, unfair debt collection, lemon law and other consumer fraud cases that government agencies and public interest law firms such as the Illinois Attorney General may not pursue. Class action lawsuits our Chicago consumer lawyers have been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. Lubin Austermuehle is proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to consumer fraud and consumer rip-offs, and in the right case filing consumer protection lawsuits and class-actions you too can help ensure that other consumers’ rights are protected from consumer rip-offs and unscrupulous or dishonest practices.

Our Waukegan, Lombard, Mokena and Chicago consumer attorneys provide assistance in fair debt collection, consumer fraud and consumer rights cases including in Illinois and throughout the country. You can click here to see a description of the some of the many individual and class-action consumer cases we have handled. A video of our lawsuit which helped ensure more fan friendly security at Wrigley Field can be found here. You can contact one of our Chicago consumer law attorneys who can assist in lemon law, unfair debt collection, predatory lending, mortgage and real-estate fraud, wage claims, unpaid overtime and other consumer, consumer fraud or consumer class action cases by filling out the contact form at the side of this blog or by clicking here.

Illinois Attorney General Lists Top Consumer Fraud Complaints

May 28, 2010 | Peter S. Lubin and Patrick Austermuehle

The Illinois Attorney General has listed the top 10 consumer complaints of 2009. The Attorney General’s website describes those complaints:

The intensifying home foreclosure crisis dominated Attorney General Lisa Madigan’s Top 10 Consumer Complaints for 2009. Madigan today reported that 31,264 consumers filed complaints with her Consumer Protection Division last year. The consumer debt category topped the complaints filed by Illinois consumers, including a 65 percent increase in residential mortgage-related complaints. In addition, an estimated 21,000 consumers have called the Attorney General’s Homeowner Helpline for assistance since 2008, while the Attorney General’s Consumer Fraud Bureau helped secure an estimated $23 million in mortgage-related savings, including loan modifications for at-risk borrowers, last year.

“These numbers demonstrate how this economic crisis is hitting home for tens of thousands of Illinois families,” Madigan said. “Hardworking people are struggling to make their mortgage payments on time. They’re fighting to cope with mounting debts, and they’re being targeted by con artists looking to make a quick buck. This is a challenging time, and I urge anyone who is struggling to make ends meet to contact my office to make sure that they do not become victims of fraud.”
Consumer Debt Complaints Rank First
Since 2008, complaints to Madigan’s office about consumer debt grew nearly 16.5 percent, a reflection of the increasingly dire financial constraints people in Illinois are experiencing during the economic downturn. Complaints in this top category cover a wide range of consumer debt issues, such as residential mortgages, credit card debt, and installment loan debt. Specifically, the highest reported debt-related complaints involved:

Mortgage Foreclosure
In 2009, nearly 4,000 homeowners filed residential mortgage complaints with Madigan’s office, a 65 percent increase over the previous year. In addition to the significant increase, the types of complaints reported are also transforming. In the first wave of the foreclosure, a majority of complaints reported to the Attorney General’s office came from homeowners who were placed in risky home loans that they could never afford. As the foreclosure crisis continues, Madigan said that around 2008 her office began receiving more calls from homeowners who have lost their jobs and can no longer make their mortgage payments.

Madigan has made helping homeowners stay in their homes a top priority. In October 2008, the Attorney General brokered a ground-breaking $8.7 billion settlement in her predatory lending lawsuit against Countrywide, the nation’s largest mortgage lender, that established the country’s first mandatory loan modification program. As a result of this settlement and President Obama’s subsequent HAMP program, thousands of Countrywide borrowers in Illinois, and hundreds of thousands nationwide, have been able to modify their loans and remain in their homes. During 2009, Madigan also filed suit against Wells Fargo, alleging the lender engaged in consumer fraud and illegally discriminated against African American and Latino homeowners by selling them high-cost subprime mortgage loans while white borrowers with similar incomes received lower cost loans.

The Attorney General’s office also reported an increase in complaints against mortgage rescue companies that prey on homeowners who are desperate to save their homes. In the most common form of the scam, these so-called foreclosure “rescue” businesses charge homeowners a large up-front “consulting” fee to negotiate a loan modification with the lender. But after taking the homeowners’ money, these companies actually do little or nothing to save the home, leaving homeowners in an even more difficult situation. Madigan has filed 31 lawsuits targeting mortgage rescue scams.

Madigan established the Homeowner Helpline (1-866-544-7151) in 2008 to provide direct assistance for borrowers who risk losing their homes to foreclosure. Since its inception, the helpline has received more than 21,000 calls from homeowners seeking assistance. The Attorney General’s office also has helped secured more than $21 million in loan modification savings for borrowers who were at risk of losing their homes to foreclosure over the past year. Madigan encouraged consumers who are at risk of falling behind on their mortgage payments to call her office to learn more about homeowners’ rights and the options available to them to try to save their home.

Collection Agencies
In 2009, the consumer debt complaints received by Madigan’s office included more than 1,300 reports about collection agencies, including complaints that agencies started collection efforts without verifying that the consumer actually owed the debt, attempted to collect a debt from the wrong person and used abusive tactics such as making calls to a consumer’s workplace or using threatening language.

Credit Card Companies
More than 1,000 consumers sought help from Madigan’s office for problems with their credit cards. Increasing numbers of consumers called to complain that their credit card companies added unexpected fees and charges to their monthly statements and suddenly increased the interest rate on their cards. Other consumers complained that the credit card companies suddenly reduced their credit limits. Madigan said that consumers can dispute the changes to their credit agreements directly with the credit card company or call her Consumer Fraud Bureau for assistance in disputing charges.

Identity Theft Complaints Rank Second
After calls to Madigan’s office about consumer debt, identity theft remained high on the annual list of consumer complaints, coming in at the second most-reported issue. Madigan’s office received 4,376 identity theft-related complaints in 2009. A significant number of the complaints involve:

1.Credit card complaints (1,279), including reports of the takeover of an existing credit card account by a thief and also instances of a thief opening a new credit card account in the name of an ID theft victim;
2.Utility company complaints (464), concerning fraudulent wireless or landline phone, Internet, gas, electric and water accounts opened in the ID theft victim’s name; and
3.Bank fraud complaints (437), including complaints regarding stolen checks, new bank accounts opened in an ID theft victim’s name, and fraudulent withdrawals of money from victims’ bank accounts.
Consumers brought most of these complaints to Madigan’s office by contacting her Identity Theft Hotline (1-866-999-5630). Trained advocates and attorneys staff the hotline, working with consumers one-on-one to help them take the steps necessary to report the crime to local law enforcement and financial institutions, repair their credit and prevent future problems.

The Top 10 consumer complaints for 2009 are as follows:

CATEGORY # OF COMPLAINTS
1. Consumer Debt (mortgage lending, collections, credit cards) 7,843
2. Identity Theft (fraudulent credit cards and utility accounts, bank fraud) 4,376
3. Construction Home Improvement (remodeling, roofs/gutters) 2,601
4. Telecommunications (wireless service, local phone service, cable/satellite) 2,240
5 Promotions and Schemes (sweepstakes, pyramid, work-at-home schemes) 1,689
6. Motor Vehicles/Used Auto Sales (as-is sales, financing, warranties) 1,372
7. Mail Order (Internet purchases, catalog ordering, television/radio) 1,364
8. Fraud Against Business (consulting, directories/publications) 1,135
9. Utilities (natural gas, electric, water/sewer) 843
10. Motor Vehicle/Non-Warranty Repair (collision/body, engines, tune ups) 728

First District Upholds Punitive Damages Award in Defective Townhouse Case

May 19, 2010 | Peter S. Lubin and Patrick Austermuehle

Our Chicago consumer fraud attorneys were pleased to see a recent ruling affirming real estate buyers’ right to relief, and punitive damages, after fraud by the builder. Linhart v. Bridgeview Creek Development Inc., No. 1-07-2712, (Ill. 1st May 20, 2009). Plaintiffs Ken Linhart, Beverly Linhart, Amy Gable, Jane Longo, Lloyd Clark and Diane Latta bought four townhomes in the Bridgeview subdivision in Palatine, Ill. in 1997 and 1998. All four units were part of the same building. During construction of that building, a town inspector noted that the foundation was sinking. This problem was not obvious during the pre-purchase walk-throughs, but later allegedly caused the building to sink seven to ten inches, causing cracks in the walls, slanted floors, floors and ceilings pulling apart, sticking doors and windows and flooding.

In 2001, the plaintiffs sued the developer, builder and its owner over these defects, claiming breach of implied warrant of habitability; fraudulent misrepresentation and concealment; and violation of the Illinois Consumer Fraud and Deceptive Business Practices Act. A jury trial returned a verdict of $1.38 million in compensatory damages for all plaintiffs, plus punitive damages of $5,000 plus attorney fees for each plaintiff. Defendants appealed, saying the jury’s decision was against the manifest weight of the evidence; the jury was improperly instructed; the six plaintiffs should have had six separate verdicts rather than one; and punitive damages were improper.

The First District started with the meatiest issue: whether the verdict itself was not supported by the evidence. On the fraud and Consumer Fraud Act claims, the defendants argued that plaintiffs should have shown that they relied on defendants’ misrepresentations when they purchased the townhouses. As to the four plaintiffs claiming common-law fraud, the court wrote, there was in fact ample evidence that they did so. The evidence in the record shows that defendants lied about the cause of cracks in the walls and the foundation, including the statement that “it’s not like the house is going to sink or anything.” Thanks to the village inspector’s report, defendants knew this was not true. Thus, the common-law fraud verdict was valid, and because common-law fraud is enough to support a Consumer Fraud Act claim, both verdicts were affirmed. The court also upheld the amount of the damages, saying qualified expert testimony supported it.

The court next examined the defendants’ argument that plaintiffs should have presented evidence for their own claims separately and received separate verdicts. It’s true that Illinois law requires separate verdicts when separate recoveries are sought, the First District wrote, but on the relevant count — breach of implied warranty of habitability — all of the plaintiffs presented their case as a single plaintiff, asking for repairs to the building as a whole. Thus, the ruling was affirmed. The First also rejected defendants’ arguments that the jury instructions were deficient in several ways. It did find an error in the jury instructions for breach of implied warranty of habitability, but said this error was harmless.

Last, the First District considered the issue of whether punitive damages were proper even though the plaintiffs never explicitly requested them. Punitive damages are available under the Consumer Fraud Act, the court noted, and plaintiffs asked for any relief provided by that law. Furthermore, evidence at trial showed that the defendants acted fraudulently or maliciously, as required for punitive damages, because they failed to correct a defect they knew about and intentionally misrepresented that defect to the buyers. And the trial court did not abuse its discretion, the appeals court said, because it considered both sides’ arguments and the defendants’ financial position. Thus, it upheld the punitive damages award and affirmed all of the trial court’s rulings.

Video Describing Your Lemon Law Rights Applying to Motorcycles, Cars and Many other Products

May 19, 2010 | Peter S. Lubin and Patrick Austermuehle

Below is an informative video describing lemon rights for motorcycles, cars and other products:

If you believe you purchased a motorcycle, car, rv or other product that is a lemon, have been a victim of auto fraud, auto dealer fraud, auto repair fraud or have been deceived into buying a flood car, rebuilt wreck or salvage vechicle Lubin Austermuehle may be able to help rectify the problem. We or experienced co-counsel are prepared to file suit in the right case in the Chicago area or anywhere in the country. For a free consultation on your rights as an employee, contact us today.

Our Auto Dealer Fraud, Auto Repair Fraud Auto Fraud, RV Fraud, Motorcycle Fraud and Boat Fraud private law firm and our affliated co-counsel handle individual and class action consumer rights, lemon law, and autofraud lawsuits that government agencies and public interest law firms may decide not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. Lubin Austermuehle is proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to employee and consumer fraud and rip-offs, and in the right case filing employee or consumer protection lawsuits and class-actions you too can help ensure that consumers’ rights are protected from unscrupulous, illegal or dishonest practices.

20/20 Reports on Debt Collector Abuse — Our Chicago Consumer Trial Attorneys Stop Debt Collector Abuse

May 13, 2010 | Peter S. Lubin and Patrick Austermuehle

Debt collectors are prohibited by federal law from engaging in deception, extortion, threats, lies, and invading your privacy by calling your friends, neighbors and employers. This video exposes illegal debt collection practices and explains practices which violate the law such claiming that you owe money which is owed by others, calling your workplace and revealing the debt, or threatening to bring suit or obtain a judgment with no intent to do so. Many debt collectors are pressured to meet sales quotas and engage in abuse to make money. Debt collectors can be persistent but they can’t abuse or lie to you to get the bills paid.

Our Oak Brook consumer rights private law firm handles individual and class action predatory lending, unfair debt collection, lemon law and other consumer fraud cases that government agencies and public interest law firms such as the Illinois Attorney General may not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. The Chicago consumer attorneys at Lubin Austermuehle are proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to consumer fraud and consumer rip-offs, and in the right case filing consumer protection lawsuits and class-actions you too can help ensure that other consumers’ rights are protected from consumer rip-offs and unscrupulous or dishonest practices.

Our Waukegan and Wheaton consumer lawyers provide assistance in fair debt collection, consumer fraud and consumer rights cases including in Illinois and throughout the country. You can click here to see a description of the some of the many individual and class-action consumer cases we have handled. A video of our lawsuit which helped ensure more fan friendly security at Wrigley Field can be found here. You can contact one of our Chicago consumer law lawyers who can assist in lemon law, unfair debt collection, predatory lending, wage claims, unpaid overtime and other consumer, consumer fraud or consumer class action cases by filling out the contact form at the side of this blog or by clicking here.

Video Providing Car Buying and Lemon Law Tips — Our Chicago Lemon Law and Auto Fraud Attorneys File Suit to Protect Consumer Rights

May 12, 2010 | Peter S. Lubin and Patrick Austermuehle

This video provides tips for buying a car and describes some lemon law rights.

If you believe you purchased a car that is a lemon, have been a victim of auto fraud, auto dealer fraud, auto repair fraud or have been deceived into buying a flood car, rebuilt wreck or salvage vechicle Lubin Austermuehle may be able to help rectify the problem. We or experienced co-counsel are prepared to file suit in the right case anywhere in the country. For a free consultation on your rights as an employee, contact us today.

Our Auto Dealer Fraud, Auto Repair Fraud Auto Fraud, RV Fraud, and Boat Fraud private law firm and our affliated co-counsel handle individual and class action consumer rights, lemon law, and autofraud lawsuits that government agencies and public interest law firms may decide not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. Lubin Austermuehle is proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to employee and consumer fraud and rip-offs, and in the right case filing employee or consumer protection lawsuits and class-actions you too can help ensure that consumers’ rights are protected from unscrupulous, illegal or dishonest practices.

News Report Exposes Alleged Improper Debt Collection Practices — This Video Helps Explain Your Rights — Our Chicago Consumer Lawyers Fight to Vindicate Your Fair Debt Collection Rights

May 12, 2010 | Peter S. Lubin and Patrick Austermuehle

Debt collectors will go to great lenghts to trick, intimidate or exort you into paying debts. These tactics are illegal and you can file suit to stop improper debt collector harrassment. This video discusses some alleged violations of the Fair Debt Collection Practices Act and then informs you of some of your legal rights.

Our Chicago consumer rights private law firm handles individual and class action predatory lending, unfair debt collection, lemon law and other consumer fraud cases that government agencies and public interest law firms such as the Illinois Attorney General may not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. Lubin Austermuehle is proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to consumer fraud and consumer rip-offs, and in the right case filing consumer protection lawsuits and class-actions you too can help ensure that other consumers’ rights are protected from consumer rip-offs and unscrupulous or dishonest practices.

Our Highland Park, Deerfield, and Barrington consumer attorneys provide assistance in fair debt collection, consumer fraud and consumer rights cases including in Illinois and throughout the country. You can click here to see a description of the some of the many individual and class-action consumer cases we have handled. A video of our lawsuit which helped ensure more fan friendly security at Wrigley Field can be found here. You can contact one of our Chicago consumer law lawyers who can assist in lemon law, unfair debt collection, predatory lending, wage claims, unpaid overtime and other consumer, consumer fraud or consumer class action cases by filling out the contact form at the side of this blog or by clicking here.

Best Websites to Learn About Consumer Law Issues — Our DuPage, Lake, and Cook County, and Chicago Consumer Lawyers Can Assist You in Consumer Fraud and Deceptive Business Practices Lawsuits

April 24, 2010 | Peter S. Lubin and Patrick Austermuehle

The National Consumers League’s webpage contains numerous tips for avoiding internet fraud. You can view the site by clicking here. Be on the watch for credit repair scams promising to clean your negative credit history. Below are tips fron the League’s website on how to avoid credit repair scams:

No one can erase negative information if it’s accurate. Only incorrect information can be removed. Accurate information stays on your record for 7 years from the time it’s reported (10 years for bankruptcy). Even information about bills you fell behind on but now are paid will remain on your report for these time periods.

Credit repair services can’t ask for payment until they’ve kept their promises. Federal law also requires credit repair services to give you a explanation of your legal rights, a detailed written contract, and three days to cancel (this applies to for-profit services, not to nonprofit organizations, banks and credit unions, or the creditors themselves).

Fifth District Allows New Trial for Insurance Customer Unhappy With Arbitration Award

April 21, 2010 | Peter S. Lubin and Patrick Austermuehle

Our Illinois insurance bad faith attorneys were pleased to see a recent decision from the Fifth District Court of Appeals that upheld a driver’s right to fair treatment from her auto insurance company. American Family Mutual Insurance Company v. Stagg, Ill. 5th No. 5-08-0088 (Aug. 10, 2009) Diane Stagg had an insurance policy with American Family that included uninsured and underinsured motorist coverage. That part of the policy had a provision stating that the parties could demand arbitration if they couldn’t agree on the existence or amount of coverage. It also said that arbitration awards would be binding and could be entered as judgments in court if they did not exceed the minimum limits set by the Illinois Safety Responsibility Law. If they did exceed that limit, either party has the right to a trial. The limit for bodily injury at the time was $20,000.

Stagg was later hit by an at-fault driver with a very small amount of insurance. She collected the $25,000 available in liability insurance from the at-fault driver, but requested more under her uninsured motorist coverage. She and American Family went to arbitration and she was awarded $36,340.75. However, the arbitrators set off $25,000 for the at-fault driver’s payment and $5,000 in expenses American Family had paid, leaving her with an award of just $6,340.75. Four months later, American Family filed a complaint to enforce that judgment, saying Stagg hadn’t objected to the award within time limits set by the Illinois Uniform Arbitration Act. The next month, Stagg filed a separate action against American Family, seeking a new trial.

The parallel claims may have caused some conflicting decisions by the court, but it eventually clarified that it intended to grant Stagg’s motion to dismiss American Family’s complaint. American Family appealed, arguing that the arbitration award was $6,340.75, too low to meet the contract’s threshold for going to court. Stagg argued that the arbitration award was actually 36,340.75, making it larger than the minimum limit cited in the contract. In its analysis, the court found that the term “arbitration award” as used in the contract was subject to more than one interpretation. Under American States Insurance Co. v. Koloms, 177 Ill. 2d 473, 479 (1997), the court said, ambiguous language in an insurance policy should be construed against the drafter. Thus, Stagg is entitled to a new trial under the contract.

The court then addressed American Family’s contention that Stagg missed the deadline to appeal the arbitration award under the Uniform Arbitration Act. The Fifth agreed with Stagg, who argued that the limitation didn’t apply because she isn’t challenging the award through the Act, but instead requesting a new trial. The arbitration award was never binding under the contract’s language, the court said, meaning that Stagg had no obligation to state any grounds for overturning it. Thus, the court’s decision to dismiss American Family’s complaint was upheld.

A Great Video Describing Lemon Law Rights — Our Chicago Trial Attorneys Bring Lemon Law and Auto Fraud Lawsuits

March 7, 2010 | Peter S. Lubin and Patrick Austermuehle

An excellent video summarizing lemon law rights is below:

If you believe you purchased a car that is a lemon, have been a victim of auto fraud, auto dealer fraud, auto repair fraud or have been deceived into buying a flood car, rebuilt wreck or salvage vechicle Lubin Austermuehle may be able to help rectify the problem. We or experienced co-counsel are prepared to file suit in the right case anywhere in the country. For a free consultation on your rights as an employee, contact us today.

Our Auto Dealer Fraud, Auto Repair Fraud Auto Fraud, RV Fraud, and Boat Fraud private law firm and our affliated co-counsel handle individual and class action consumer rights, lemon law, and autofraud lawsuits that government agencies and public interest law firms may decide not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. Lubin Austermuehle is proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to employee and consumer fraud and rip-offs, and in the right case filing employee or consumer protection lawsuits and class-actions you too can help ensure that consumers’ rights are protected from unscrupulous, illegal or dishonest practices.