The U.S. Supreme Court will decide in the fall whether a consumer who purchased title insurance through a referral arrangement that allegedly violated the anti-kickback provisions of the Real Estate Settlement Procedures Act (RESPA) can sue in federal court if she cannot show actual injury. "The viability of this type of garden variety 'gotcha' litigation might be undermined if the Supreme Court rules in favor of First American," said Alan S. Kaplinsky, a Ballard Spahr partner who represents banks and is not involved in First American Financial Corp. v. Edwards.

The Supreme Court limited its review to constitutionality issue. "That is what makes this case enormously significant, because it has implications that go well beyond Respa," Kaplinsky told American Banker. "If the Supreme Court reverses the Ninth Circuit, it will be a very rare case where the consumer will be able to prove actual injury under RESPA and [the Truth in Lending Act]. This could be a very happy event for First American and the banking industry."