Merchants Are Not “Financial Institutions” or “Debt Collectors” for EFTA/FDCPA Claims Arising from Refund and Payment-Dispute Conduct

1. Introduction

Still, David v. Wayfair Inc. (Del. Apr. 14, 2026) arises from an online retail purchase dispute. David Still bought a sofa for approximately $1,800 through Wayfair’s website in 2024 and later complained about cushion firmness. Wayfair first offered a partial refund, then refunded the full purchase price and attempted to arrange a return pickup. Still retained both the refund and the sofa, refusing to schedule pickup.

Still filed a ten-count complaint in the Court of Common Pleas asserting statutory and warranty theories. The Court of Common Pleas dismissed on the basis that a forum-selection clause in Wayfair’s online terms required a different venue. Still appealed to the Superior Court seeking to proceed in forma pauperis; the Superior Court dismissed the appeal under 10 Del. C. § 8803(b) as factually and legally frivolous. Still then appealed to the Delaware Supreme Court.

The Delaware Supreme Court’s order primarily addresses whether Still stated any cognizable claims—particularly under the federal Electronic Fund Transfer Act (“EFTA”) and Fair Debt Collection Practices Act (“FDCPA”)—and whether any asserted procedural or due process defects warranted reversal.

2. Summary of the Opinion

The Court affirmed the Superior Court’s dismissal. It held that multiple appellate arguments missed the dispositive basis of dismissal because the Superior Court did not dismiss on venue, mootness, or enforceability of online terms. On the merits, the Court concluded Still failed to plead a cognizable claim under:

  • EFTA, because the statute governs “financial institutions,” and Still did not allege facts supporting an inference that Wayfair is one.
  • FDCPA, because the statute targets “debt collectors” collecting debts owed to another (or creditors using a different name to imply third-party collection); Wayfair, as alleged, was pursuing payment on its own behalf.

The Court also rejected Still’s asserted due process objections after review and left the dismissal intact.

3. Analysis

3.1 Precedents Cited

  • Still v. Wayfair, Inc., 2025 WL 1992882 (Del. Super. Ct. July 17, 2025).
    This was the Superior Court decision on review. The Supreme Court’s order treats it as the operative ruling and affirms its conclusion that Still’s appeal could be dismissed at the screening stage under 10 Del. C. § 8803(b) where claims are factually and legally frivolous. While the Supreme Court does not re-litigate the Superior Court’s full rationale, it confirms that the Superior Court did not dismiss based on the forum-selection clause (a key point undermining several of Still’s appellate arguments).
  • Batchelor v. Alexis Props., LLC, 2018 WL 5919683, at *5-6 (Del. Super. Ct. Nov. 13, 2018).
    Cited for the settled proposition that the term “debt collector” under the FDCPA generally does not include a creditor collecting its own debt. This precedent anchors the Supreme Court’s conclusion that—even accepting Still’s allegations as true—Wayfair’s conduct as described does not fall within the FDCPA’s coverage.

3.2 Legal Reasoning

A. Appellate arguments must match the actual basis of dismissal

The Court repeatedly notes that Still attacked rationales the Superior Court did not employ. Several arguments sought to invalidate Wayfair’s terms of use (e.g., “browserwrap” and “dark patterns,” public policy objections, arbitration challenges), but the Supreme Court emphasized that the Superior Court’s dismissal was not grounded on the forum-selection clause or venue. Similarly, Still argued “mootness” and “improper venue,” but the Superior Court did not dismiss on those grounds. This framing matters: appellate review generally fails where the appellant does not confront the dispositive reasoning of the decision below.

B. EFTA claim fails because Wayfair is not alleged to be a “financial institution”

The Court treated the EFTA as a targeted consumer-banking statute. It cited the EFTA’s definitions and operative provisions to show the statute’s focus on entities that hold consumer “accounts” and have duties to investigate and correct “errors.” Still alleged that refund activity “constitute[d] cognizable EFTA violations,” but he did not allege facts indicating that Wayfair holds demand deposits/savings or functions as an EFTA “financial institution.” Without that statutory predicate, the claim fails as a matter of law.

C. FDCPA claim fails because Wayfair is not alleged to be a “debt collector”

The Court applied the FDCPA’s definitional boundary: a “debt collector” typically collects debts “owed ... another,” with a narrow inclusion for a creditor who uses a different name to create the impression of third-party collection. Still’s allegations, even read favorably, described Wayfair attempting to obtain payment on its own behalf in connection with the purchase/refund dispute. Under Delaware Superior Court authority (including Batchelor v. Alexis Props., LLC), that is not “debt collection” by a “debt collector” within the FDCPA’s scope.

D. Due process and transfer arguments

Still asserted due process violations based on allegedly conflicting orders, an “unpublished and inaccessible” lower-court decision, a typographical error, and failure to transfer under 10 Del. C. § 1902. The Supreme Court stated it found no due process violations after careful review, signaling that none of these contentions rose to reversible procedural error.

3.3 Impact

  • Clarifies the boundary between retail disputes and federal banking/debt-collection statutes. The order reinforces that EFTA and FDCPA claims require threshold statutory status (financial institution; debt collector). Plaintiffs cannot convert ordinary merchant refund/payment controversies into EFTA/FDCPA cases without pleading facts that satisfy those definitions.
  • Supports screening dismissal of legally unsupported claims in in forma pauperis appeals. By affirming dismissal under 10 Del. C. § 8803(b), the Court underscores that Delaware courts may terminate appeals at the screening stage where claims are legally foreclosed by well-settled law.
  • Signals limits on “terms-of-use” litigation when not dispositive. Although the opinion recites “browserwrap” and “dark patterns” arguments, it shows courts may bypass such issues if the case can be resolved on narrower grounds (here, lack of cognizable federal statutory claims and lack of reversible procedural error).

4. Complex Concepts Simplified

  • In forma pauperis: Permission to proceed without paying ordinary filing fees due to inability to pay; Delaware law authorizes courts to screen such actions/appeals for frivolousness.
  • Factually/legally frivolous (10 Del. C. § 8803(b)): “Factually frivolous” claims lack any plausible factual basis; “legally frivolous” claims are barred by well-settled law such that even a diligent pro se litigant should recognize the defect.
  • Forum-selection clause: A contract term requiring disputes be litigated in a particular court/location.
  • Browserwrap / dark patterns: Claims about online design choices (links, placement, non-negotiability) allegedly undermining meaningful consent. The Supreme Court did not decide enforceability here because the dispositive dismissal did not rest on those terms.
  • EFTA (Electronic Fund Transfer Act): A federal statute governing electronic transfers involving consumer accounts at “financial institutions” (e.g., banks); it imposes duties like investigating and correcting account errors.
  • FDCPA (Fair Debt Collection Practices Act): A federal statute regulating third-party debt collectors; it typically does not apply to a creditor collecting its own debt in its own name.

5. Conclusion

Still, David v. Wayfair Inc. affirms that not every consumer-retail dispute can be reframed as a federal statutory violation. The Court’s central takeaway is definitional and practical: EFTA claims require a “financial institution,” and FDCPA claims require a “debt collector” as the statute defines it. Where a plaintiff’s allegations describe a merchant’s own refund and payment-dispute conduct, and where appellate arguments do not address the actual basis for dismissal, Delaware courts may properly dismiss the matter—particularly at the screening stage under 10 Del. C. § 8803(b).