July 14, 2025
Below you will find several key developments in the financial services industry, including related developments in information privacy and data security, from the past week. We add an "Amicus Brief(ly)1" comment to each item, where we briefly (see what we did there?) note for friends (and again?) of CounselorLibrary the important takeaways from the developments outlined in the email. Our legal reporters - CARLAW, HouseLaw, InstallmentLaw, PrivacyLaw, and BizFinLaw - provide more comprehensive, real-time updates of federal and state laws, regulations, litigation, and other industry items of interest. For a personal guided tour and free trial of any of these legal reporters, please contact Michael Willer at 614-855-0505 or mwiller@counselorlibrary.com.
On July 8, the U.S. Court of Appeals for the Eighth Circuit issued an opinion that vacated the Federal Trade Commission's Negative Option Rule in its entirety. The FTC's compliance deadline for the rule, which had been extended once, was set to go into effect on July 14. The Eighth Circuit vacated the rule based on procedural deficiencies in the rulemaking process.
The FTC finalized the Negative Option Rule on November 15, 2024. Shortly after the FTC finalized the rule, various industry associations and businesses challenged the rule in four circuit courts of appeals. The rule required sellers to obtain, and maintain records of, unambiguous affirmative consent to a negative option feature and to provide a simple mechanism for cancellation that is as easy to use as the mechanism the consumer used to consent to the subscription.
The Eighth Circuit found that the FTC erroneously determined that the national economic effect of the proposed rule would be under $100 million and, on that basis, declined to conduct a preliminary regulatory analysis describing and analyzing the reasonable regulatory alternatives to the proposed rule. In January and February 2024, the FTC held informal hearings before an administrative law judge, who observed that unless each business used fewer than 23 hours of professional services at the lowest end of the spectrum of estimated hourly rates, the rule's compliance costs would exceed $100 million. The ALJ found that this estimate was "clearly unrealistically low" and that the rule would have an annual effect on the national economy that exceeded the $100 million threshold.
The Eighth Circuit held that this failure deprived businesses and other interested parties of the opportunity to engage with the FTC's cost-benefit estimates during the rulemaking process. The court determined that the procedural deficiencies in the rulemaking process caused prejudice to the interested parties and, given the breadth of the rule's coverage, vacated the entire rule.
It is unclear whether the FTC, now under new leadership, will seek Supreme Court review or re-initiate the rulemaking process.
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On July 8, Connecticut Attorney General William Tong announced an $85,000 settlement with a company that operates an online marketplace for buying and selling tickets, resolving allegations that it violated the Connecticut Data Privacy Act ("CTDPA"). The CTDPA, which took effect on July 1, 2023, provides consumers with the right to access, correct, and delete personal data collected and stored by covered businesses and the right to opt out of the sale of personal data and targeted advertising. Covered businesses must maintain clear privacy notices that describe these rights and how consumers may exercise their rights. The AG's press release states that his office sent a CTDPA "cure notice" to the company in November 2023, notifying the company of certain deficiencies in its privacy notice and giving the company a chance to come into compliance without penalty. The press release states that the company's privacy notice was "largely unreadable, missing key data rights, and contained rights mechanisms that were misconfigured or inoperable." Because the company did not resolve these alleged deficiencies within the 60-day cure period, the AG took action.
In addition to the monetary penalty, the company "has agreed to comply with the requirements of the CTDPA, maintain metrics for consumer rights requests received under the CTDPA, and provide a report of these metrics to the [AG]."
From the CTDPA's effective date of July 1, 2023, until December 31, 2024, the AG was required to provide a 60-day cure period for businesses to correct alleged violations of the law before facing penalties. As of January 1, 2025, the AG can still offer a cure period at his discretion on a case-by-case basis, but he is no longer required to do so.
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On July 7, New Hampshire Governor Kelly Ayotte signed House Bill 437, which provides new automatic discharge periods for mortgages based on whether their term or maturity date is stated or not.
Specifically, H.B. 437 repeals Section 479:28 of the New Hampshire Revised Statutes Annotated and replaces it with provisions stating that, as of January 1, 2028, undischarged mortgages in which the term or maturity date is not stated will be deemed discharged 35 years from the date of recording of the mortgage, unless an extension of the mortgage, or an acknowledgment or affidavit that the mortgage is not satisfied, is recorded before the expiration of the 35-year period. For mortgages in which the term or maturity date is stated, the mortgage will be deemed discharged five years from the expiration of the term or the maturity date, unless an extension of the mortgage, or an acknowledgment or affidavit that the mortgage is not satisfied, is recorded before the expiration of the term or maturity date. The statute currently provides that undischarged mortgages are void after 50 years.
The new law also provides that if an extension of the mortgage or an acknowledgment or affidavit that the mortgage is not satisfied is recorded, the undischarged mortgage will be deemed discharged five years from the expiration of the extension period if stated or five years from the date of recording of such extension, acknowledgment, or affidavit if no extension period is stated.
H.B. 437 also repeals RSA 479:29, which provides that Section 479:28 does not apply to mortgages held by banks, trust companies, and savings and loan associations, whether as named mortgagee or assignee of record.
The new law is effective on September 5, 2025.
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With the adoption of House Bill 368, Louisiana joined the growing list of states to adopt earned wage access ("EWA") laws. The Louisiana bill became law on July 1, 2025, without Governor Jeff Landry's signature. Under the new law, EWA providers will be subject to disclosure and conduct limitations, but they will not be subject to licensing requirements like those adopted in some other states.
The Louisiana Earned Wage Access Services Act, which takes effect August 1, 2025, applies to EWA providers offering consumer-direct or employer-integrated earned wage access services. EWA services consist of, in relevant part, delivering to a consumer access to earned but unpaid income. The law applies to any such transaction involving a consumer residing in Louisiana.
An EWA provider must disclose certain information to a consumer, including all fees associated with EWA services, as well as the voluntary nature of tips and gratuities. Among the conduct requirements, a provider must have policies in place to address consumer complaints and allow consumers to cancel EWA services without charge. A provider must also offer consumers a reasonable option to get proceeds at no cost. To the extent a provider charges fees, it will need to submit an annual report to the Louisiana Office of Financial Institutions.
A provider that complies with the EWA law will not be deemed to be engaging in lending, money transmission, or debt collection. Among other exclusions, the law does not apply to a provider that will report a consumer's payment or nonpayment to a consumer reporting agency.
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The American Financial Services Association issued a blog post on July 10 concerning H.R. 1, otherwise known as the "One Big Beautiful Bill Act," which was signed by President Trump on July 4. AFSA reflects that a portion of the bill - Section 70203. NO TAX ON CAR LOAN INTEREST - could have a significant impact on certain car buyers "and serve as a boost for the vehicle finance marketplace in moving American-produced metal." As AFSA notes, for taxable years 2025 through 2028, interest on "qualified passenger vehicle loans" for certain new vehicles purchased during the four-year period for personal purposes where final assembly occurred in the United States would be tax-deductible, subject to an annual cap of $10,000, but would begin to be phased out for single filers whose modified adjusted gross income exceeds $100,000 and joint filers whose modified adjusted gross income exceeds $200,000.
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