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Case Citation
Legal Case Name

Leonard Applebaum v. Nissan Motor Acceptance Corporation Reitenbaugh Enterprises, Inc Case Brief

Court of Appeals for the Third Circuit2000Docket #723402
226 F.3d 214 2000 U.S. App. LEXIS 22230 2000 WL 1225805 Consumer Law Contracts Administrative Law

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Case Brief Summary & Legal Analysis

General Brief
4 min read

tl;dr: A lessor violated the Consumer Leasing Act by failing to disclose the specific “residual value” of a leased car in its early termination formula. The court held that a disclosure is not “clear” if it omits a necessary, otherwise unknowable variable, making the formula unsolvable.

Legal Significance: Establishes that under the Consumer Leasing Act, a lessor must disclose all essential, pre-determined variables (like residual value) used in its early termination formula. The “clear disclosure” standard requires that the method be calculable, not just that its components are named.

Leonard Applebaum v. Nissan Motor Acceptance Corporation Reitenbaugh Enterprises, Inc Law School Study Guide

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Case Facts & Court Holding

Key Facts & Case Background

Leonard Applebaum leased two vehicles from Nissan Motor Acceptance Corporation (NMAC) under closed-end lease agreements. The leases contained an early termination penalty clause stating the charge was the “Adjusted Lease Balance” minus the vehicle’s “Realized Value.” The “Adjusted Lease Balance” was defined as the sum of the remaining monthly payments and the vehicle’s “residual value,” discounted to present value by the “Constant Yield Method.” The leases did not state the numerical figure for the “residual value,” a value pre-determined by NMAC at the inception of the lease. When Applebaum terminated his first lease early, he was charged a significant penalty. Despite his requests, neither the dealership nor NMAC would explain the calculation or provide the residual value figure used. Applebaum filed suit, alleging the early termination provision violated the disclosure requirements of the Consumer Leasing Act (CLA) and Regulation M because the formula was indecipherable without the undisclosed residual value. The District Court granted summary judgment for NMAC.

Court Holding & Legal Precedent

Issue: Does the Consumer Leasing Act’s requirement to disclose the method for calculating an early termination penalty in a “clear and conspicuous manner” obligate a lessor to disclose the specific value of a pre-determined variable, such as residual value, that is an essential component of that method?

Yes. The court reversed the summary judgment, holding that the leases violated Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non pr

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IRAC Legal Analysis

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Legal Issue

Does the Consumer Leasing Act’s requirement to disclose the method for calculating an early termination penalty in a “clear and conspicuous manner” obligate a lessor to disclose the specific value of a pre-determined variable, such as residual value, that is an essential component of that method?

Conclusion

This case establishes that for a consumer lease disclosure to be “clear” Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugia

Legal Rule

Under the Consumer Leasing Act, 15 U.S.C. § 1667a(11), a lessor must Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cill

Legal Analysis

The Third Circuit interpreted the CLA's requirement that disclosures be made “in Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia deserunt mollit anim id est laborum. Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris

Flash-to-Full Case Opinions

Flash Summary

  • The Consumer Leasing Act (CLA) requires that the method for calculating
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum dolore eu fugiat nulla pariatur. Excepteur sint occaecat cupidatat non proident, sunt in culpa qui officia

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