Seventh Circuit holds that TILA rescission cases may not proceed as class actions: Andrews v. Chevy Chase Bank

In Andrews v. Chevy Chase Bank, ___ F.3d ___ (7th Cir. Sept. 24, 2008), the Seventh Circuit held that claims for rescission (as distinct from damages) under the Truth in Lending Act (15 U.S.C. §§ 1601 et seq.) may not be pursued on a classwide basis because "the rescission remedy prescribed by TILA is procedurally and substantively incompatible with the class action device." Slip op. at 8. One judge dissented. Id. at 16-18.

One of the authorities on which the court relied in reaching this conclusion is LaLiberte v. Pacific Mercantile Bank, 147 Cal.App.4th 1 (2007), in which the California Court of Appeal held that "rescission under TILA is a personal remedy not suitable for class action treatment." Id. at 10.

Today's National Law Journal reports that "Mortgage Lenders Fight Off Rescission Class Action in 7th Circuit."