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Consumer Protection — TILA

United States Court of Appeals for the Seventh Circuit


Consumer Protection — TILA

It did not violate the Truth in Lending Act for a retailer to send new credit cards to its customers and deactivate the customers’ old cards.

“Plaintiffs try to cast the Visa mailings as an offer to change the underlying account relationship and not as an actual change to the account relationship. As support, they point to the instances where Guest Card holders were targeted for Visa substitution, but the customer either called Target or protested at the point of sale. But the Autosub program was more than a mere offer—unless a customer affirmatively resisted the substitution, either the Visa replaced the Guest Card or the Guest Card account was closed entirely. Moreover, Plaintiffs’ assertion that an offer to substitute the Visa for the Guest Card would somehow offend TILA is without support in the regulations or commentary. In fact, it strikes us as contrary to the spirit of TILA to read the statute as Plaintiffs urge. If a customer’s ability to reject a substitution card somehow rendered the substitution illegal, issuers would instead impose the substitution with no opt-out ability. Consumer choice and flexibility would be hamstrung—a strange result under a consumer protection statute.”


13-2706 Acosta v. Target Corp.

Appeal from the United States District Court for the Northern District of Illinois, Gottschall, J., Flaum, J.

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