Curtis v. Propel Property Tax Funding, LLC, 265 F. Supp. 3d 647

Curtis entered a Virginia-authorized third-party tax payment agreement (TPA) with Propel: Propel paid $14,547.65 in real-property taxes to Petersburg; Curtis agreed to repay Propel in installments with a 10.95% interest rate and a 10% origination fee; payments were allocated first to fees, then interest, then principal.
The TPA and accompanying Memorandum stated Propel’s payment to the locality did not extinguish Curtis’s obligation and that any tax lien remained unaffected; Curtis also signed an EFT Agreement authorizing recurring electronic debits.
Curtis alleges Propel conditioned the TPA on repayment by electronic funds transfer and included an EFT provision waiving EFTA rights; he sued on behalf of himself and similarly situated consumers under TILA, the EFTA, and the Virginia Consumer Protection Act (VCPA).
Propel moved to dismiss; it primarily challenged whether the TPA constitutes TILA/EFTA “credit” and raised a standing challenge to the EFTA claim in supplemental briefing.
The court found Curtis sufficiently pleaded injury and causation for EFTA standing, held the Virginia TPA structure constitutes consumer “credit” under TILA and the EFTA (so TILA and 15 U.S.C. §1693k claims survive), and dismissed the VCPA claim for failure to plead with particularity but granted leave to amend.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Standing for EFTA claims	Curtis alleged concrete, particularized harm from EFTA rights being abridged by TPA/EFT terms	Propel argued Curtis lacks standing to bring EFTA claims	Court: Curtis has Article III standing; injury is the type Congress sought to prevent; certified for interlocutory appeal
Whether TPAs are consumer “credit” under TILA	TPAs are third-party financing that defer payment of a tax debt and are primarily for household purposes (real-property taxes)	Propel relied on precedents treating tax-liens/transfers as non-credit where lender acquires the lien	Court: Virginia TPAs qualify as consumer credit (Propel does not acquire the tax lien); TILA claim survives; certified for interlocutory appeal
Whether conditioning extension of credit on EFT violates 15 U.S.C. §1693k	Curtis: Propel conditioned TPA on repayment by preauthorized EFT and included waivers of EFTA rights	Propel contested applicability (and raised other merits arguments later)	Court: §1693k claim survives as TPAs are credit and conditioning repayment by EFT is implicated; some Propel merits arguments not considered due to briefing timing
VCPA §59.1-200 claim pleading	Curtis alleged fraudulent acts in a consumer transaction	Propel argued Curtis failed to plead fraud with particularity and failed to specify which defendant did what	Court: Dismiss Count III for failure to plead with Rule 9(b) particularity but grant leave to amend

Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (concrete and particularized injury requirement for Article III standing)
Susan B. Anthony List v. Driehaus, 134 S. Ct. 2334 (2014) (cases/controversies requirement)
Dreher v. Experian Info. Solutions, Inc., 856 F.3d 337 (4th Cir. 2017) (statutory procedural-right violations can confer concrete injury when the harm is the type Congress sought to prevent)
Pollice v. National Tax Funding, L.P., 225 F.3d 379 (3d Cir. 2000) (tax lien assignments mean holder enforces preexisting tax claims; contrasted here)
Billings v. Propel Fin. Servs., L.L.C., 821 F.3d 608 (5th Cir. 2016) (Texas scheme where lender acquires tax lien treated differently; court distinguishes it from Virginia TPAs)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standards — courts need not accept legal conclusions)
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for pleadings)
Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250 (4th Cir. 2009) (Rule 12(b)(6) standard and inferences for pleadings)