The Seventh Circuit Court of Appeals’s highly anticipated Truth In Lending Act (TILA) class action decision in Andrews v. Chevy Chase Bank, No. 07-1327 (7th Cir., Sept. 24, 2008) was finally issued Wednesday. The court reversed the district court’s class certification decision and joined the First and Fifth Circuit Courts of Appeals in holding that the TILA’s rescision remedy (at the risk of oversimplification, the right to back out of the deal), is not suitable for class-wide treatment. The case involves claims by a Wisconsin couple that their mortgage lender violated TILA, 15 U.S.C. § 1635, by misrepresenting facts in selling them an adjustable rate mortgage (ARM) of the type that is the center of the current subprime lending crisis. The opinion, authored by Judge Diane S. Sykes, is available for download on the court’s website.
As usual, Class Action Defense Blog has already posted a thorough summary of the decision, so rather than repeating the nuances of the decision here, I’ll direct you to that post.
Paul Karlsgodt
Raj Chohan
CAB Staff
[...] The Indiana Blog, How Appealing, and Corporate Legal Times, are among the many legal blogs that commented on the Seventh Circuit Court of Appeals’ decision disallowing a class action claim for rescission of a mortgage under the Truth in Lending Act (TILA) (See CAB entry here): [...]
[...] For synopses of various cases addressing Truth in Lending Act (TILA) issues, including the viability of class actions for rescission of mortgages, see this entry from Foreclosure Combatant. (Note that the Seventh Circuit Court of Appeals recently overturned the decision in Andrews v. Chevy Chase Bank. See this September 26 CAB Entry). [...]