Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—NDIll: Home Owner Met Consumer Nexus Test to Assert Consumer Protection Claim, (Apr 5, 2013)
Law Firms Mentioned:Karbal Cohen Economou Silk Dunne LLC | Progressive Law Group LLC
Organizations Mentioned:Applebrook Realty, Inc.
By Jody Coultas, J.D.
A loan holder stated an Illinois Consumer Fraud and Deceptive Business Practices Act (CFA) claim against Applebrook Realty, Inc., according to the federal district court in Chicago (Frazier vs. U.S. Bank National Assn., April 4, 2013, St. Eve, A.).
First, the court noted that Federal Rule of Civil Procedure 8 applied to the claims at issue because they were based on unfair conduct rather than fraud as Applebrook argued.
Applebrook argued that the loan holder was not a consumer within the meaning of the CFA because he was not a direct consumer of Applebrook’s services or similar to other Applebrook consumers. A consumer is any person who purchases or contracts for the purchase of merchandise for his use or that of a member of his household. The loan holder was not required to directly consume Applebrook’s services to state a CFA claim. In these types of cases, a non-consumer may prevail by alleging a consumer nexus with the alleged conduct, according to the court.
The consumer nexus test requires a showing of trade practices directed to the market generally or that the conduct otherwise implicated consumer protection concerns. Illinois courts are split as to whether the consumer nexus test applies to claims by individuals as well as business non-consumers, the court applied the test in this claim.
The court held that the loan holder met the consumer nexus test. The loan holder alleged that Applebrook’s policy was to track borrowers’ loans en masse and unlawfully ordered property services during periods when the borrowers had a right to remain in their homes. Allegations that a company broke into homes and dispossessed the owners of his property without notice or court approval was sufficient factual predicate for a CFA claim.
The case is No. 11 C 8775.
Attorneys: Alex Stepick , IV (Progressive Law Group LLC) for Samuel Fraizer. Newton C. Marshall (Karbal Cohen Economou Silk Dunne LLC) for Applebrook Realty, Inc.
Companies: Applebrook Realty, Inc.
Cases: StateUnfairTradePractices IllinoisNews