Class Action Complaint Dismissed After Mandell Menkes Attorneys Craft Novel Argument on a Federal Statute

On November 28, 2012, United States District Judge Virginia Kendall issued an opinion granting our client New Vitality’s motion to dismiss every claim alleged in a purported class action complaint.  The plaintiff sought to hold New Vitality liable for claims arising under the Electronic Fund Transfer Act and the Illinois Consumer Fraud and Deceptive Trade Practices Act, alleging that New Vitality violated federal regulations governing preauthorized transfers from consumer bank accounts.  New Vitality maintained the charges it issued to plaintiff for vitamin supplements were fairly disclosed but, in any event, the federal regulations about which plaintiff complained did not apply to the charges made in connection with its promotional offer. 


Judge Kendall agreed with Mandell Menkes’ narrow construction of 15 U.S.C. § 1693e, holding that the statutory provision would not find application in cases in which the plaintiff denied authorizing the debits at issue.  Although the district court recognized that a “paucity” of case law existed on some of the core issues raised in the motion, it reasoned that three related rulings Mandell Menkes analogized from other district courts made apparent the “limited scope” of §1693e.  The ruling granting the motion to dismiss may be retrieved here and a Chicago Daily Law Bulletin article reporting on the decision is available here.


Steven Mandell, Stephen Rosenfeld and John Fitzpatrick were the Mandell Menkes lawyers representing New Vitality in this matter.