Past Cases

PUBLISHED OPINIONS 

Anthony D’Agostino v. Ricardo Maldonado, 216 N.J. 168 (2013)

Submitted a brief to the New Jersey Supreme Court on behalf of amicus curiae Consumers League of New Jersey to address the issue of ascertainable loss and treble damages under the New Jersey Consumer Fraud Act in a case involving an unconscionable foreclosure rescue scheme in which the homeowners had signed over title to their home to the defendant.  Our amicus brief argued that limiting the homeowners’ remedy under the Consumer Fraud Act to return of title to their home, as the Appellate Division had done, satisfied only one level of treble damages, did not fulfill the deterrent, punitive and private attorney general functions of treble damages, undermined the Consumer Fraud Act’s express intent that its remedies be cumulative to other remedies, and was not supported by the language or policy of the Consumer Fraud Act.   The Supreme Court so held in all respects.

Blanca Gonzalez v. Wilshire Credit Corporation and U.S. Bank National Association, as Trustee, 207 N.J. 557 (2011)

Counsel for plaintiff in action alleging consumer fraud by a mortgage servicer. After a judgment of foreclosure was entered plaintiff entered into an agreement with the mortgage servicer to make payments, and when she was no longer in arrears the judgment was to be dismissed. She alleged that the servicer engaged in unconscionable conduct in the performance of the agreement by, among other things, charging her for forced-placed insurance she did not need because the house was already insured, charging her unwarranted and unexplained fees, and otherwise improperly diverting her payments. Plaintiff sued under the New Jersey Consumer Fraud Act.  The lender and servicer argued that the Consumer Fraud Act did not apply to post judgment agreements because such agreements had nothing to do with a loan but were just settlements to which the CFA did not apply as a matter of statutory interpretation.  They further argued that as a matter of policy applying the CFA to such agreements would discourage work-outs by lenders and lead to sheriff's sales, thus hurting homeowners.  The New Jersey Supreme Court rejected both arguments.  It held that the post judgment agreement was an extension of credit to which the CFA did apply, including the  subsequent performance of the agreement, and as to public policy the Court stated:

We are in the midst of an unprecedented foreclosure crisis in which thousands of our citizens stand to lose their homes, and in desperation enter into agreements that extend credit -- post-judgment -- in the hope of retaining homeownership. Defendants would have us declare this seemingly unregulated area as a free-for-all zone, where predatory-lending practices are unchecked and beyond the reach of the CFA.

In ruling for plaintiff and rejecting the arguments of the lender and servicer, the New Jersey Supreme Court refused to do as defendants (and amicus New Jersey Bankers Association)  wanted, instead applying the CFA to protect homeowners.

Delta Funding Corp. v. Harris, 189 N.J. 28 (2006)  (On certification of a Question of Law from the United States Circuit Court of Appeals for the Third Circuit)  

Counsel for defendant homeowner in action by lender to compel arbitration of homeowner’s counterclaims/third party claims in pending foreclosure action. Supreme Court found several provisions of the arbitration agreement unconscionable, i.e.,  provision allowing arbitrators to force the mortgagor to pay all arbitration costs if she lost, provision preventing her from recovering discretionary statutory attorneys' fees and costs, and the provision barring her from recovering costs and attorneys’ fees on appeal even if she prevailed.   Case also established for the first time in New Jersey that in analyzing the costs imposed by an arbitration provision, reviewing courts should not consider after-the-fact offers by defendants to pay the plaintiff's share of the arbitration costs where the agreement itself provides that the plaintiff is liable.  Dual procedure imposed by arbitration agreement requiring litigation of same issues in two different forums (defending foreclosure in court and bringing counterclaims/third party claims in arbitration) was held to be burdensome, but not unconscionable, and arbitration against lender was ordered.  However, the Supreme Court confirmed that under those circumstances N.J.S.A. 56:8-19 attorneys' fees are available for succesfully defending an action based on violations of the Consumer Fraud Act. 

Laufer v. The United States Life Insurance Company in the City of New York ;  Albert H. Wohlers & Co. n/k/a Seabury & Smith, 385 N.J. Super. 172 (App. Div. 2006)

Counsel for plaintiff and (b)(2) class of New Jersey insureds in consumer fraud class action.  Established for the first time that only the named plaintiffs in a class action must be able to demonstrate an ascertainable loss under the Consumer Fraud Act in order to have standing to sue on behalf of a class.

Associates Home Equity Services v. Troup, 343 N.J.Super. 254 (App. Div. 2001)

Counsel for defendant homeowners in foreclosure action; brought defenses, counterclaims and third party claims under the New Jersey Law Against Discrimination, the federal Fair Housing Act, the Civil Rights Act, and the New Jersey Consumer Fraud Act against original lender and its assignee, as well as home repair related claims against lender and home repair contractor. Trial court granted summary judgment against defendants; Appellate Division reversed and its published decision ruled on a number of issues of first impression, for example: if the Notice required to be inserted into certain consumer credit contracts by the Federal Trade Commission Preservation of Consumers Claims and Defenses Rule, 16 C.F.R. 433, is improperly omitted by the lender, it shall be deemed an implicit provision of the note as a matter of state law (prior to this ruling lenders argued that consumers had no remedy for omission of the FTC Rule, relying on a body of law establishing that there is no private federal cause of action for violation of the FTC Rule); claims of predatory, discriminatory and unconscionable lending practices can be brought by homeowners by recoupment in a foreclosure action; claims of lending discrimination such as reverse redlining can be proven in New Jersey by proof of disparate impact as well as intentional discrimination.

Scott v. Mayflower Home Improvement; BankAtlantic, FSB; CIT Group; Security Pacific; MNC Credit Corp., et al.,  363 N.J.Super. 145 (Law Div. 2001)

Counsel for plaintiff class of homeowners in class action lawsuit against the home repair entity, its principals, and banks which took assignment of the installment contracts.  Case established, inter alia, that, 1) TILA does not abrogate the Federal Trade Commission Preservation of Consumers Claims and Defenses Rule, 16 C.F.R. 433, 2) contrary to case law across the country, the Federal Trade Commission Preservation of Consumers Claims and Defenses Rule, 16 C.F.R. 433, applies to all claims and defenses, not just those proving that the homeowner received little or nothing of value; 3) that home repair contracts, notes and mortgages that violate the Consumer Fraud Act or the Home Repair Financing Act are void and unenforceable.

Lemelledo v. Beneficial Management Corporation of America ,  150 N.J. 255 (1997)

Ms. Houston was admitted as amicus curiae before the New Jersey Supreme Court to address the issue of whether the New Jersey Consumer Fraud Act applies to highly regulated industries; the amicus brief argued, and the Supreme Court so held, that a preemption analysis applies to the issue, and unless there is an irreconcilable conflict or express intention on the part of the legislature to exempt a specific industry from Consumer Fraud Act coverage, the Act will apply.

Green v. Continental Rentals, 292 N.J.Super. 241 (Law Div. 1996)

As Director of Litigation for the Passaic County Legal Aid Society, Ms. Houston was counsel for plaintiff consumers in an action against a rent-to-own business which had charged consumers monthly “rental” payments equivalent to in excess of 100% interest; the published decision established that rent-to-own transactions such as those before the court are as a matter of law subject to the Retail Installment Sales Act and the state criminal usury statute, and that violations of those laws are per se violations of the New Jersey Consumer Fraud Act.

Cox v. Sears Roebuck & Co., 138 N.J. 2 (1994)

The Passaic County Legal Aid Society, Ms. Houston as Director of Litigation, was admitted as amicus curiae before the New Jersey Supreme Court to address the issue of what constitutes damages under the New Jersey Consumer Fraud Act.  She argued, and the Supreme Court so held, that a debt can be an “ascertainable loss” to be trebled under the Act, even though the debt has not yet been paid out of pocket by the consumer.

CLASS ACTION LITIGATION

Lewis, et al. v. Globe Motor Car Company, No. L-3264-03 (Law Div. Ess. Co.).  Represented plaintiff and (b)(3) class in action alleging violation of New Jersey Consumer Fraud Act, regulations, common law fraud and conversion.  Settled with individually calculated full refunds automatically mailed to all class members – no proofs of claim required.

Frenkel v. Sansone Plaza Dodge, No. L-7425-02 (Law Div. Mid. Co.).   Counsel for objector to class action settlement (trial court finding that objector’s involvement improved the settlement for the class)

Johnson v. Mayflower Home Improvement, BankAtlantic FSB, CIT Group; Security Pacific; MNC Credit Corp., et al., No. L-2628-95 (Law Div. Pass. Co.).  Represented plaintiff and (b)(3) class; settled with mortgages in issue canceled or monetary payments being made to class members.

Reid v. North Jersey , et al., No. L-84324-85 (Law Div. Pass. Co.).   As Director of Litigation for the Passaic County Legal Aid Society, Ms. Houston represented plaintiff class; (b)(3) class certified – settled with mortgages in issue canceled and monetary payments being made to class members.

Housing Authority of the City of Paterson v. Dugans, No. C-2737-80 (Law Div. Pass. Co.).   As Director of Litigation for the Passaic County Legal Aid Society, Ms. Houston represented defendant/counterclaimant who was representative party for the class; (b)(2) class certified - declaratory and injunctive relief was granted.

Plaza v. Municipal Welfare Dept of the City of Paterson , et al., No. L-33994-81 ( Law Div. Pass. Co.).  As Director of Litigation for the Passaic County Legal Aid Society, Ms. Houston represented plaintiff class; (b)(2) class certified - declaratory and injunctive relief was granted.