The fine print may not be so fine after all.  Joe was sure he could get out of his high-rate mortgage because federal law requires borrowers receive notice they have the right to rescind or cancel a transaction within three business days and, if that notice isn’t given, they have up to three years to rescind the deal.  In the documents Joe signed, the transaction date and the three-day deadline date had been left blank.  But the Court of Appeals for the First Circuit held it was just a technical mistake since the date of the transaction was stamped on the upper right corner and the text said the borrower had three business days to rescind.  Other Circuits have held that even the most minor technical flaw triggers the three-year rescission privilege.  But the Court said if Mel had read the document, he would’ve seen the date of the transaction and could have easily counted three days forward.  So unless the Supreme Court writes the final word, Joe is out of luck.  A little thing did in the little guy, and it looks like the fine print is fine for them, but not fine for you.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Melfi v. WMC Mortgage Corp., First Circuit Court of Appeals, No. 09-1066, Boudin, J., U.S. Law Week, Vol. 77, No. 50, Pg. 1813, 6-30-09

Podcast: Download

Google is great but it’s not beyond the reach of the law, and a recent decision by the Second Circuit Court of Appeals may cause Google to gag.  This case was brought by a company called Rescue.com, a computer service company.  Rescue.com objected to its placement on the Google search engine and sued, claiming Google users are misled into believing that ads that appear on the screen are part of the relevance-based search engine as opposed to paid advertisements, which they are.  The way it works is that companies purchased keywords which put them high up on the list.  At issue in this case was the keyword suggestion tool, which recommends keywords to advertisers for purchase.  Rescue.com claimed trademark infringement, but the Court that first heard the case dismissed it on the grounds that Google used Rescue.com’s trademark in non-visible metatags.  But the Court of Appeals reversed, holding that visible or non-visible use of a trademark is actionable.  So Google definitely isn’t giggling and it could be in for a gaggle of changes.

THIS IS NEIL CHAYET LOOKING AT THE LAW™
Rescue.com v. Google, Second Circuit Court of Appeals, No. 06-4881-CV, April 3, 2009, Leval, J., U.S. Law Week, Vol. 77, No. 40, Pg. 1638, 4-21-09

Podcast: Download

Cable companies are no longer insulated from competition.  That’s the result of a well-grounded decision of the D.C. Court of Appeals.  At issue was the question whether cable companies can have exclusive contracts with apartment buildings.  It used to be the rule that cable companies undertake the expense of wiring the apartment complex and then have it all to themselves.  The FCC issued an order prohibiting exclusive contracts between cable companies and apartment building owners.  The National Cable and Telecommunications Association sued claiming the FCC lacked authority to prohibit exclusivity.  The law makes it unlawful for a cable operator to engage in unfair methods of competition or interfere with any multi-channel video programming source, including satellites.  The cable operators argued the law was designed to prevent exclusivity with regard to programming, not service.  But the Court said it could mean no exclusivity for programming or service.  So on the question of why are we here, broadband has gotten broader, hopefully it won’t turn out to be wire less and pay more.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

National Cable and Telecommunications Association v. Federal Communications Commission, D.C. Circuit Court of Appeals, No. 08-1016, May 26, 2009, Tatel, J., U.S. Law Week, Vol. 77, No. 47, Pg. 1758, 6-9-09

Podcast: Download

If you decide to strip search a 13-year old girl, you could find more than you bargained for.  This case got started when 13-year old Savana Redding was taken into the assistant principal’s office.  He showed her a day planner containing knives and other contraband and Savana admitted only to the planner, but said she lent it to her friend, Marissa.  He then produced prescription-strength pain pills and said he had a report Savana was handing them out.  She denied it and agreed to a search of her backpack.  She was then taken to the school nurse’s office and told to remove her outer clothing.  The nurse pulled down her bra and her underpants, but no pills were found.  The Court found for Savana holding that while searching her backpack was okay, strip searching her was not, that it was frightening and humiliating and, while such searches are not outlawed, the context of suspicion must match the degree of intrusion.  The Court did not award damages because prior cases weren’t clear, but from now on if you strip search 13-year old girls, you’d better find something and that’s the stripped down version of a case that wasn’t even a clothes call.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Safford Unified School District No. 1, et al. v. Redding, U.S. Supreme Court, No. 08-479, June 25, 2009, Souter, J.

Podcast: Download

It looks like the worldwide web is going to lead to some world-class taxes.  The battle raging all over the country is between cities and towns, and states and counties against online travel companies, also known as OTCs.  This one involved Expedia in the City of Columbus, Georgia. The question was whether the OTCs have to pay the hotel and motel tax on the reduced rate they pay for the room or on the full price paid by the consumer.  The city argued the plain language of the city hotel and motel occupancy excise tax requires Expedia to collect and remit the taxes based on the final retail charge.  The OTCs argued the hotel taxes are only due on the wholesale price, that they are not in the hotel business, and they’re not renting the room, but the Court ruled for the city, stating the law requires the tax on the full rate and Expedia must collect and pay it.  So in the end, instead of paying wholesale, we’ll all pay on the whole sale.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Expedia, Inc. v. Columbus, Georgia, Georgia Supreme Court, No. S-09-A057, June 15, 2009, Benham, J., U.S. Law Week, Vol. 77, No. 49, Pg. 1805, 6-23-09

Podcast: Download

If they go after your pets, you can go after them in court.  This case began when the City of Barceloneta, Puerto Rico, took control of three public housing complexes.  Although pets had been banned, nobody enforced the rules and pets were prevalent.  As soon as the City took over, the pet projects turned into pet peeves, and the tenants were notified that all pets had to be immediately surrendered.  A week later without any further notice, city employees and a private contractor showed up and “violently captured numerous cats and dogs,” in some cases taking them out of the arms of children.  The animals were then injected, slammed against the side of a van, and then thrown to their deaths off a 50-foot high bridge.  The tenants sued for compensatory and punitive damages and the mayor claimed immunity, but the Court refused to dismiss the case stating that pets are covered by the Fourth Amendment guaranty against unreasonable search and seizure.  So those who turned a pet policy into a pet cemetery will face dogged determination and possibly a catastrophic result.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Maldenado v. Fontanes, First Circuit Court of Appeals, No. 08-2211, June 4, 2009, Lynch, J., U.S. Law Week, Vol. 77, No. 49, Pg. 1791, 6-23-09

Podcast: Download

When you use a fake ID to go drinking at a bar, can the bar sue you?  This case got started when a college student named Charles decided to go drinking at the Old Stone Jug, located near Colgate University.  The only problem was, Charles was nineteen and the drinking age in the state of New York is twenty-one, so Charles got himself a fake New Hampshire driver’s license, showed it, and started drinking.  When he ended up at the campus police station completely intoxicated, he told officers he’d used a fake ID.  The State charged the bartender and the bar with selling liquor to a minor and moved to revoke its liquor license.  The Jug managed to hang on to its license but at great cost, and decided to sue Charles for trespass and fraud, asking for $250,000 in damages.  But the Court found for Charles, stating that if bars that serve underage drinkers are going to be able to successfully sue those drinkers; the legislature will have to permit it.  So the Old Stone Jug has come up empty and Charles, who was sued for having a fake ID, has faked them out once again.

THIS IS NEIL CHAYET LOOKING AT THE LAW™
OSJ d/b/a The Old Stone Jug v. Charles E. Work, Supreme Court of NY, 4/12/99, William J. O’Brien III, J., 1999 W.L. 261666

Podcast: Download

When Barney goes up against the famous chicken, it’s gonna take more than a wing and a prayer to get even.  Everybody knows and loves Barney, and even those who can’t stand looking at him anymore, would acknowledge he’s part of the American scene.  In the words of the Court, his awkward and lovable behavior, good-natured disposition and renditions of songs like, “I love you, you love me” have warmed the hearts and captured the imagination of children around the world.  Ted Jiannoulas is the famous San Diego chicken, a sports mascot that for the past 35 years had jumped, tackled and flattened Barney at ballparks across America.  Barney’s owners finally sued arguing that beating up Barney is harmful to children.  One parent described how his 2-year old was in tears as he said, “chicken step on Barney.”  The famous chicken claimed in defense that Barney is a symbol of the platitudes thrust unthinkingly upon our children, and the Court found the famous chicken Barney battle is a legally acceptable parody.  So the good guy lost this one, but maybe the last year for the famous chicken, and Barney still stands tall and definitely carries a big schtick.

THIS IS NEIL CHAYET LOOKING AT THE LAW™
Lyons Partnership vs. Ted Giannoulas, d/b/a The Famous Chicken, U.S. Court of Appeals Fifth Circuit, 7/7/99, Jolly, J., 1999, W.L. 409585 (5th Cir. Texas)

Podcast: Download

Should marshmallows carry a warning label?  Laura had just finished her shift as a waitress and bought a bag of large marshmallows for the kids.  The next morning while she was asleep, one of the kids climbed up on the counter, retrieved the bag of marshmallows, and gave some to his younger brother.  Within a few minutes, the child starting choking.  A man who was visiting performed the Heimlich maneuver, but the child continued choking, was rushed to the hospital where a small liquefied piece of marshmallow was removed from his airway.  He sustained brain damage, and Laura sued, claiming marshmallows are dangerous to consumers, who should be warned of the choking hazard.  The Court that first heard the case held marshmallows possess no inherently dangerous characteristics, but Laura appealed, and the Appeals Court reversed holding that marshmallows are dangerous for children, that while they appear soft and innocuous, they continue to expand after entering the airway.  One Judge dissented, but the majority ruled and although the law may getting soft, marshmallows may soon carry a warning label at the result of a case that turned out not to be a lot of fluff after all.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Chad Emery and Laura Emery vs. Federated Foods, Inc., et al., Supreme Court of Montana, 11/18/93, Gray, J., 262 Mont. 83, 863 p. 2d 426

Podcast: Download

Here’s a case where white-out played center stage.  It all got started when Ken decided to sell his motorcycle.  He thought he had it sold to Joe, and was so sure Joe was going to buy it, he wrote Joe’s name and address onto the title, then the sale fell through.  Mark bought the motorcycle, so Ken whited-out Joe’s name and address and wrote in Mark’s.  Unfortunately, the certificate of title says in capital letters, “IF ANY ALTERATIONS OR ERASURES ARE MADE, THIS TITLE IS VOID.”  Ken probably should have whited-out those words, too, but he didn’t.  Mark was then involved in a very serious accident with the motorcycle and his insurance company claimed that title was void because of the white-out.  Therefore, Mark didn’t legally own the cycle, and they didn’t have to pay the claim.  The Judge that first heard the case agreed, but the Appeals Court reversed, ruling that there’s nothing in the law that authorized the DMV to declare that all alterations or erasures automatically void a title.  So the bottom line is–when you use white-out, while you may not win outwhite, you may outwit the opposition–all white alweady.

THIS IS NEIL CHAYET LOOKING AT THE LAW™

Auto Club Insurance Assoc., vs. Mark T. Sarate, Court of Appeals of Michigan, 6/25/99, Curiam, 1999 W.L. 450422 (Mich.)

Podcast: Download