212 F.3d 1356 (11th Cir. 2000), 98-6786, Jones v Bill Heard Chevrolet

Docket Nº:98-6786.
Citation:212 F.3d 1356
Party Name:Cleopatra JONES, on behalf of herself and all others similarly situated, Delois Pritchett, on behalf of herself and all others similarly situated, Plaintiffs- Appellants, v. BILL HEARD CHEVROLET, INC., Defendant-Appellee.
Case Date:June 02, 2000
Court:United States Courts of Appeals, Court of Appeals for the Eleventh Circuit

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212 F.3d 1356 (11th Cir. 2000)

Cleopatra JONES, on behalf of herself and all others similarly situated, Delois Pritchett, on behalf of herself and all others similarly situated, Plaintiffs- Appellants,


BILL HEARD CHEVROLET, INC., Defendant-Appellee.

No. 98-6786.

United States Court of Appeals, Eleventh Circuit

June 2, 2000

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[Copyrighted Material Omitted]

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Appeal from the United States District Court for the Middle District of Alabama.

(No. 96-00862-CV-D-N), Ira De Ment, Judge.

Before EDMONDSON and HULL, Circuit Judges, and WOOD[*], Senior Circuit Judge.

HULL, Circuit Judge:

Plaintiffs-Appellants Cleopatra Jones and Delois Pritchett ("Plaintiffs") brought this action against Defendant-Appellee Bill Heard Chevrolet, Inc. ("Heard Chevrolet"), for alleged violations of the Truth in Lending Act ("TILA"), 15 U.S.C. § 1638(a)(2)(B)(iii), and TILA's implementing regulation, Regulation Z, 12 C.F.R. § 226.18(c)(1)(iii). Plaintiffs appeal the district court's order granting summary judgment for Defendant Heard Chevrolet on Plaintiffs' TILA claims. After review, we reverse.


Plaintiffs instituted separate fraud actions in Alabama state court against Defendant Heard Chevrolet based on inaccurate disclosures during their purchases of automobiles and extended service contracts. Heard Chevrolet removed both actions to federal court, where they were consolidated. Plaintiffs then filed a joint amended complaint, with Count One containing the fraud claims under state law. The subsequent dismissals of these fraud claims are not involved in this appeal. This appeal addresses only Count Two which alleged TILA and Regulation Z violations based on Heard Chevrolet's inaccurate disclosure that the entire fee for Plaintiffs' extended service contracts was paid to third party General Motors. In fact, most of the fee was retained by the dealership. We first review the transactions regarding those contracts.

A. The Extended Service Contracts

In 1995, Plaintiffs purchased automobiles from Defendant Heard Chevrolet and extended service contracts from General Motors through Heard Chevrolet. To finance these purchases, Plaintiffs entered into retail installment contracts ("RICs") with Heard Chevrolet. Specifically, Plaintiff Jones purchased a 1993 Geo Storm from Heard Chevrolet and executed her RIC on February 27, 1995. As part of the purchase, Jones paid $2,495 for an extended service contract. Heard Chevrolet itemized the amount paid and being financed, on the RIC, as follows:

Itemization of Amount Financed 1 Cash Price (including any accessories, services, and taxes) $ 9795.45 _________ 2 Total Downpayment ... $ 800.00 _________ 3 Unpaid Balance of Cash Price (1 minus 2) $ 8995.45 _________ 4 Other Charges Including Amounts Paid to Others on Your Behalf: ...

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H Other Charges (Seller must identify who will receive payment and describe purpose) to GENERAL MOTORS 12/12 for ____ SERVICE CONTRACT $2495.00 _________

Heard Chevrolet concedes that its disclosure in this "Itemization" was inaccurate regarding the amount Heard Chevrolet, as seller, paid to General Motors on Jones's behalf for the extended service contract.1 Heard Chevrolet did not pay $2495 to General Motors as represented. Heard Chevrolet paid General Motors only $290 and retained an "upcharge" or mark-up of $2,205 for itself.2 In addition, Heard Chevrolet concedes that it did not disclose to Jones that it was retaining any portion of the amount listed as paid to General Motors.

Plaintiff Pritchett's RIC contained a similar misrepresentation when she purchased a 1991 Pontiac Grand Prix from Heard Chevrolet on May 9, 1995. As part of the purchase, Pritchett paid $765 for her extended service contract. Heard Chevrolet inaccurately represented in Pritchett's RIC that Heard Chevrolet had paid General Motors $765 for her service contract. In fact, Heard Chevrolet retained a substantial portion of that $765.

B. District Court Proceedings

The district court granted summary judgment for Defendant Heard Chevrolet on Plaintiffs' TILA claims. Heard Chevrolet primarily argued that regardless of whether the dealership violated TILA's disclosure provisions, the "good faith" defense in TILA insulated Heard Chevrolet from liability. See 15 U.S.C. § 1640(f). In granting summary judgment, the district court agreed that the "good faith" defense in TILA protected Heard Chevrolet from liability. The district court declined to decide whether Heard Chevrolet actually violated TILA.

Both Plaintiffs timely appealed the adverse judgment on their TILA claims, but only Plaintiff Jones has pursued the appeal. Although both Jones's and Pritchett's names appear on the notice of appeal and on the cover of Plaintiffs-Appellants' brief, that brief recites the facts about only Jones's purchase and discusses only Jones's claims. Plaintiffs-Appellants' brief contains no mention of Pritchett's transaction or her claim. Defendant-Appellee Heard Chevrolet's response brief points out that Pritchett's claims are thus abandoned. Plaintiffs-Appellants' reply brief does not contest that argument. At oral argument, only Jones's claims were mentioned. Therefore, we find that Pritchett's claims are abandoned. See Atkins v. Singletary, 965 F.2d 952, 955 n. 1 (11th Cir.1992) (determining appellants have abandoned claims not addressed on appeal); Greenbriar, Ltd. v. City of Alabaster, 881 F.2d 1570, 1573 n. 6 (11th Cir.1989) (stating issue abandoned where party did not make any arguments on the merits as to that issue in its initial or reply brief). Thus, we now consider only Jones's TILA claim.

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This Court reviews the district court's grant of summary judgment de novo, applying the same standards used by the district court. See Killinger v. Samford Univ., 113 F.3d 196, 198 (11th Cir.1997). For summary judgment purposes, the facts are viewed in the light most favorable to the nonmoving party. See Jones v. Cannon, 174 F.3d 1271, 1281 (11th Cir.1999).


A.TILA Claim

The district court found that it "need not decide whether the disclosure requirements are mandatory or permissive" and that "[t]his is because TILA provides a 'good faith' defense, which, Defendant argues, insulates it from liability in this case." We agree, however, with Plaintiff Jones's arguments that the determination of whether a TILA violation occurred is necessary before properly analyzing Heard Chevrolet's "good faith" defense. In this particular case, the application of the "good faith" defense is intertwined with a determination of whether...

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