Posts Tagged ‘ Class Action Lawsuit ’
Week Adjourned: 1.21.12
January 23rd, 2012. By LucyC
Top Class Actions
Holy HELOC Batman—It’s been certified! A class action lawsuit brought by a couple in Cupertino in 2009—and which has been through 4 attempts to get certified—finally got the nod from a federal court judge this past week. And this one could affect many people.
The back story—Washington Mutual and JPMorgan Chase (Chase has since acquired WaMu) allegedly reduced credit limits on Jeffrey and Jenifer Schulken’s home equity line of credit (HELOC) without valid reasons.
Specifically, the HELOC class action lawsuit alleges violations of the Truth in Lending Act violations and unfair competition among other claims. The Cupertino couple allege they were informed by Chase, by letter, that their home equity credit lines would be suspended because they did not have enough monthly income to satisfy their debts. The Schulken’s allege that the monthly income of $11,200 that Chase claimed the couple stated on their applications, was inaccurate, that they had never “provided such an inflated income figure to WaMu, and that if the Schulkens’ file indicated such an income, then WaMu had intentionally misrepresented their income.”
After four attempts by Chase to have the complaint dismissed, two classes have now been certified: the “inability to verify” class, and a subclass of borrowers whose credit lines were suspended because Chase could not verify their financial circumstances.
The plaintiffs’ class definition to include “only those members who signed contracts that (1) arise from heritage WaMu customers, and (2) state that the borrower must provide, upon the lender’s request, ‘a current financial statement, new credit application, or both.’”
Top Settlements
Couple of big pharma settlements announced this week…
At the top of the hit parade we have Johnson & Johnson (J&J). They have reportedly agreed to pay $158 million to settle a lawsuit in Texas that alleges the company defrauded the state by misleading doctors about its antipsychotic drug Risperdal.
The deal will put an end to claims that J&J marketed Risperdal off label—for unapproved uses—and downplayed health risks associated with the drug. Texas had originally sought at least $579 million in damages. Well, shoot for the stars—isn’t that how the saying goes?
Bloomberg reported that the settlement follows some rather incriminating testimony given in court last week. Testimony that included an expert eye witness stating that J&J hid data showing Risperdal could cause weight gain that could lead to diabetes. According to Bloomberg “the witness also alleged that J&J had key study [ Study 113] results several years before it added warnings about weight gain to the drug’s label.”
Bloomberg notes in its report that J&J’s unpublished studies—ah—yes—more than one—were cited in a South Carolina case that brought a $327 million judgment against the pharmaceutical manufacturer. “It is apparent to this court that this information was not disclosed because if did not fit the marketing department’s vision for the promotion and marketing of this drug,” Judge Roger Couch wrote in a ruling (as quoted by Bloomberg). Amen to that.
And singing from a similar song sheet—we have Merck. It was announced this week that they have agreed to pay up to $37 million to settle a Canadian Vioxx class action lawsuit. Included in the settlement is $10 million for costs and fees. Plaintiffs’ lawyer said up to 2,000 Canadians may be eligible for compensation.
FYI—Vioxx (Rofecoxib) was on the market from 1999 to 2004, prescribed to patients as a pain-reliever for arthritis, osteoarthritis, menstrual pain, and other acute pain. Vioxx was recalled and pulled off the market when it was linked to deadly side effects heart attack, stroke, kidney damage, and arrythmia. This led to billions of dollars’ worth of litigation, including a $4.85 billion settlement that covers most of the U.S. plaintiffs.
Ok—That’s a wrap for this week. See you at the bar!
Gambling for Justice: Class Action Lawsuit v. Small Claims Court, Place Your Bets
January 13th, 2012. By AbiK
It’s a well-chronicled sentiment: class action lawsuit lawyers get rich on attorneys’ fees and the little guy gets stiffed. Whether true or not—and there are arguments on both sides—it’s easy to see how a settlement check for $1.13 can make a plaintiff feel like ‘thanks, but no thanks’. And that brings us to the case of Heather Peters, who is suing Honda in small claims court over her claim that Honda engaged in false advertising when it stated her 2006 Honda Civic Hybrid had a 50 MPG rating.
Small claims court? Isn’t that only for some kind of ‘my boyfriend split with my smart phone and $800 I had under the mattress” type of reality tv show crap?
Well, no—and that’s the point—or calculated bet—Peters is trying to make. See, according to the Honda Civic Hybrid Class Action lawsuit proposed settlement FAQ, each class member would receive $100 as settlement. Peters, who is a former attorney herself, deems that a bit of a paltry sum and so she took the route that most of us do not and she chose to opt out of the proposed settlement. And, in turn, she took her complaint to small claims court.
What’s intriguing about her choice is that, not only can she seek up to $10,000—the new 2012 limit set for small claims in California where the complaint is being heard—but, if she can persuade enough 2003-2009 Honda Civic Hybrid owners to follow suit (no pun) and head to small claims court, she estimates that Honda would be liable for nearly $2 billion—vs the current liability they face coming out of the class action lawsuit in which each class member would receive $100.
Talk about power to the people—if only the people took to the power—by February 11, 2012—the date by which class members’ opt out requests to the Settlement Administrator need to be postmarked.
At issue in the Honda Civic Hybrid Class Action lawsuit is not just that advertised miles per gallon (MPG) ratings for the car were misrepresented, but also—and here’s where a subclass of class members enters into the picture, to which Peters also belongs—that for model years 2006-2008, Honda Civic Hybrid (HCH) owners were told their cars needed a software update to the Integrated Motor Assist (“IMA”) battery system.
What HCH owners didn’t know—and American Honda Motor Co. apparently did not disclose—was that allegedly, in order to install the update, the result would be a negative impact on fuel economy. Not ideal when the primary reason you purchased the car was for its fuel economy.
You can start to see where $100 per claimant—worth what? a couple of tank fills?—isn’t sounding like much.
So Peters is placing her bets on small claims court. But as stated earlier, it’s a bit of a calculated bet for her–she’s done, and doing her homework. Just see her website. And she says that anyone can do the same.
But would you?
Prepping for small claims court, sans an attorney of course as that’s part of the charm of small claims court—no lawyers allowed—takes time. And, you do have to have the ability to put together a pretty darn good case, particularly if you’re taking on a major corporation. Given that, it comes down to whether you think it’s worth it, or not. And that’s probably why so many of us sit back and await whatever settlement check we receive.
You have to admire Peters though. She’s up for a fight, and she’s got a pretty good one from the looks of it—perhaps even a new profession in behind-the-scenes small claims coaching. And, at least she is not just sitting back and complaining about attorneys’ fees—she’s trying to take a stand, both literally and figuratively.
Peters’ next hearing date is January 25.
Week Adjourned: 12.17.11
December 19th, 2011. By LucyC
Top Class Actions
What Happened to that ‘Good Will Toward Men’ Thing? ‘Tis the season–and this thing called good will towards men apparently hasn’t caught on yet–in some parts. Case-in-point–Capital One. They’re facing a class action over allegations that they illegally obtain background checks on folks applying for jobs with the company. What’s in your wallet indeed!
The lawsuit was filed on behalf of Plaintiff Kevin Smith and seeks to represent a class of all Capital One employees and job applicants for the past three years.
Essentially, the lawsuit accuses Capital One of violating the Fair Credit Reporting Act (“the Act”) Act in a two ways. First, the lawsuit alleges that Capital One’s authorization form is flawed. The law imposes strict formatting requirements on companies who do background checks. The lawsuit alleges that by burying its background check authorization in a job application, including extraneous information, Capital One violated the law. On this claim, Capital One may be liable to all employees and prospective employees who signed Capital One’s standard job application.
Second, the lawsuit also alleges that Capital One failed to provide copies of the reports when it used them to take adverse employment actions, such as refusing to hire an applicant, refusing to promote an employee or terminating an employee. This practice also violates the Act, which requires companies to provide employees with copies of their background checks.
The lawsuit is potentially valuable to class members. Employees and prospective employees may be entitled to statutory damages of up to $1,000 for each violation. “Based on our understanding of Capital One’s practices, everyone who has applied or worked for Capital One in the past three years should be eligible to receive statutory damages if our lawsuit succeeds,” attorneys for the plaintiff(s) state.
Next up–Apple. All I have to say about this is Really? Here’s the skinny…
Cheap to the (Apple) Core? The uber cool icon of new technologies for the 21st century has been hit with an employment class action lawsuit. The suit alleges that Apple devised an illegal scheme of classifying at-home call center employees as independent contractors in order to avoid paying Apple’s share of payroll taxes and other business related expenses through the use of a Yellow Dog Contract.
According to the lawsuit, Apple “hires workers to answer calls from its customers in regard to billing questions and technical support” but has devised an unlawful scheme of classifying the employees as independent contractors in order to avoid paying for regular and overtime hours worked as well as the “the cost of the employer’s share of tax payments to the federal and state governments for income taxes, social security taxes, medicare insurance, unemployment insurance and payments for workers’ compensation insurance.” The complaint specifically alleges that in order to avoid the payment of these costs as required by law, the at home call center employees “are required by APPLE to each form a separate Virtual Services Corporation to act as a shell corporation as part of the scheme to insulate APPLE from APPLE’s liability for APPLE’s Business Related Expenses.” The class action lawsuit against Apple refers to these agreements between Apple and the employees as “Yellow Dog Contracts” that violate not only employment laws, but also fundamental public policy.
Top Settlements
A Fee-for-All at Walmart? Walmart has agreed to a $13.5 settlement of a securities class action this week. The lawsuit was brought by employee Jeremy Braden, and others, who alleged that the retail giant, together with Bank of America’s Merrill Lynch unit, passed along “unreasonably high fees and expenses” to its 2 million workers who had 401(k) plans. As with many 401(k) plans, Walmart’s contained a mixture of mutual funds representing investments in the bond and stock markets. The costs of managing those funds were passed along to employees.
According to a report in the AARP Bulletin the Walmart “settlement is a legal landmark because Walmart provides one of the largest 401(k) plans in the world and is the nation’s largest private employer, with more than $400 billion in annual sales.”
The timing is interesting in that the US Department of Labor is currently refining regulations around “fiduciary duty” and fee disclosure in 401(k) plans. And, the government is pressing for full disclosure of all fees paid to middlemen such as savings plan managers and wants stricter legal guidelines on how to provide the most prudent offerings at the lowest possible cost.
“I believe my account has experienced a loss in value, due to the reduced return on my investment in those plan investment options caused by the unreasonably high fees and expenses in those funds,” Braden stated in the lawsuit.
Under the terms of the settlement, Braden will collect $20,000. “Other employees covered by the class action suit will not receive payouts, but will benefit in the form of up to $9 million in reduced fees going forward. Lawyers for the plaintiffs will collect as much as $4 million,” AARP Bulletin reported.
Ok–That’s enough for this week. See you at the bar.
CL&P Class Action Filed for Storm Response
November 15th, 2011. By AbiK
If there’s an award for the most “Aw, shucks” spirit when it comes to being on the receiving end of some slight, mishap or wrongdoing, it goes to some business owners in Granby and East Granby, CT, who seemingly don’t feel that the CL&P response to the recent storm outages was inadequate.
Yes, there’s something to be said for having a nonchalant approach to whatever life throws your way. Probably good for one’s blood pressure and risk of stroke. That’s the plus side of the coin—but as always, there’s a flip side to that coin and in this instance the flip side equates mediocrity.
Remember that recent end-of-October snowstorm that unexpectedly hammered the northeast? Remember reading about the millions of home and business owners who were stranded with out power for days on end? Well, a funny thing happened. Those folks (most of them) who were supported by companies like PSE&G in NJ found themselves with restored power within three days of the outage; in fact, PSE&G reported to its customers on November 1st that service had been restored to almost 90 percent of those who’d been affected by the storm.
That’s right. Ninety percent in three days.
And how many customers had power restored within three days in Connecticut? Well, if you go with reports that indicated some 955,000 Connecticut Light & Power (CL&P) customers lost power due to the storm and that as of November 1st only 275,000 had their power restored, that comes to about twenty-nine percent.
On a personal level, here at LawyersandSettlements.com, some of our staff is based in NJ and some in CT. Our NJ team was up and running at full speed again by Tuesday morning—so they were powerless for just over two days. Our CT team was still charging up smartphones in their cars and running over to Starbuck’s to hop on the wifi there. Until Saturday afternoon—November 5th. They went a week without power, without heat.
Now, there are plenty of folks in CT who are riled up about this—it’s been all over the news with CT Governor Malloy demanding a full in-depth review of CL&P’s response. There has also been a class action lawsuit filed (by Scott Simmons who owns a hair salon in Canton) that seeks $1,000 in damages. But it’s not about the money—according to an article at The Farmington Patch, it’s about finding out why CL&P’s response was so lousy.
And that brings us to our “Aw, shucks” award. According to a recent article over at The Granbys Patch, some business owners don’t see the need for a class action lawsuit. And maybe they’re right…had the CL&P response been anywhere in the ballpark of CT’s neighboring states. But it wasn’t.
Here’s an example, from The Granbys Patch, of that “aw, shucks” sentiment about the situation—from business owner Lori Love who owns Granby Village Health:
When asked, however, if she is thinking of joining the class action lawsuit, Love replied, “Unequivocally, no.”
“Did anyone take a look at the number of trees down?” Love asked rhetorically. “Nobody can criticize for one minute how hard CL&P [employees] have worked. People are just looking for someone to blame and be angry at.
“What if they had emergency crews on standby? What would that do to our rates? There’s no point [to joining a lawsuit]. It doesn’t serve a purpose. Let’s just get things fixed and move on and get paid back from the insurance company, to which I pay a monthly premium.”
No one can criticize how hard CL&P employees have worked? How about how hard the management there has “worked”? And why were NJ residents—who were afflicted with just as many trees and power lines down—having their power restored so quickly compared to CT? Something doesn’t seem right, right?
And what about the “Let’s just get things fixed and move on and get paid back from the insurance company” bit? Hey, I’m sure everyone’s for moving on and putting this mess in the rearview mirror. But, does anyone really think that without any impetus—say, a lawsuit or official investigation—that CL&P is just going to invest in some Six Sigma deep dive to review and improve its emergency response processes? Yeah, right. Oh, and your insurance check is in the mail, too.
CL&P barely hit the mark of mediocrity on this one. And it was glaring because it’s as if someone set up—quite serendipitously—an A/B test in which CT was “A” and NJ was “B” and the variable being tested was what power company was involved. Kind of hard to hide behind the ”unusual circumstances” of the storm then.
So CL&P has some explaining to do. And if a class action lawsuit provides some motivation, so be it.
By the way, as of this writing, CL&P had announced the establishment of a storm fund to help reimburse customers for reported losses. The fund was set at $10 million. You do the math—based on the reported 955,000 customers who were powerless, that would come to $10.47 per customer. You can bet that $10.47 will go a long way to compensating folks for all the food they had to ditch once it got beyond that “safe for 48 hours” window.
Regardless, for those CT residents who would like to participate in a survey that ostensibly will be used to establish how CL&P’s storm fund will be distributed, you can do so at the United Way of Connecticut 211 website. The link to the survey is here.
Week Adjourned: 11.4.11
November 4th, 2011. By LucyC
Top Class Actions
Could this mean resolution for thalidomide victims?…New research suggests that thalidomide—a drug that caused thousands of horrific cases of deformities in children—caused far more deformities in the U.S. than were reported during the height of the pharmaceutical crisis of the early 1960s.
Invented by German drug company Grunenthal, thalidomide was widely used throughout Europe during the late 1950s and early 1960s, resulting in thousands of deaths and extreme, disfiguring birth defects when used by women during pregnancy. The drug was never approved in the United States, but the new lawsuit filed late October 2011 alleges that as many as 2.5 million doses of the drug were distributed by more than 1,200 doctors to more than 20,000 people, including pregnant women.
Newly discovered and translated documents reveal that Smith, Kline and French (SKF), now owned by GlaxoSmithKline (GSK)conducted a trial of the drug in 1956 and 1957, but buried the evidence, allegedly resulting in a missed opportunity to save thousands of lives.
Instead, according to the filed lawsuit, brought on behalf of 13 men and women with severe birth defects, SKF concealed the results of its trial from the public, allowing another company, Richardson-Merrell, now owned by Sanofi-Aventis to move ahead with large-scale “clinical trials” that involved more than 20,000 people, including pregnant women.
The lawsuit also claims that conclusions made in the early 1960s about the types of birth defects caused by the thalidomide were incorrect.
According to legal counsel, researchers concluded that thalidomide causes bilateral birth defects, such as two missing or shortened arms or hearing loss in both ears. As a result, babies born with unilateral defects, such as one deformed limb, or hearing loss in only one ear were not deemed thalidomide victims, even when their mothers were given the drug while pregnant.
However, new research involving thalidomide as part of a treatment regimen in cancer patients show that many of the assumptions used in the 1960s are incorrect. The thalidomide lawsuit alleges that this new understanding of the drug means that many individuals who experienced unilateral defects may have been misdiagnosed when their doctors told them thalidomide could not have been the cause.
“Among other things we intend to show in court that thalidomide does not work through a neural mechanism as previously thought, but affects the vascular system,” a lawyer for the plaintiffs said.
The complaint claims that the defendants are either guilty of or liable for a civil conspiracy, failing to report and covering up evidence that thalidomide was harmful, especially when taken during the early stages of pregnancy. The lawsuit also says that the defendants were negligent in continuing to manufacture, test and distribute the drug.
Top Settlements
Motrin SJS Verdict. This is one for the books. Let’s hope it makes a difference. On October 3, 2011, a Los Angeles jury returned a record-setting verdict against Johnson & Johnson and their fully owned subsidiary McNeil Consumer Healthcare for $48.2 million—with pre-interest and cost of judgment it’s expected to reach $60 million. The lawsuit alleged that Motrin caused SJS/TENS or Stevens Johnson Syndrome (SJS), also known as Erythema Multiforme, Leyll’s Syndrome, and in its later stages, Toxic Epidermal Necrolysis (TEN). SJS/TEN is a serious and potentially life-threatening disease that causes large areas of the skin to become detached and lesions to develop in the mucous membranes.
The verdict was based on findings of malice towards the consumers of the over-the-counter drug Motrin, specifically for not putting a warning label on the product that could have spared Trejo’s and others’ health. This is believed to be the first verdict of its kind involving punitive damages associated with this over-the-counter temporary pain reliever.
At age 16, Christopher Trejo, who is now 22 years old, took some Motrin as directed on the label for less than one week, but contracted TEN. It caused a severe inside-out exfoliating reaction affecting all of his mucosal membranes, which is equivalent to second- and third-degree burns over 100% of his body. The TEN reaction also caused severe pulmonary damage, near-blindness, infertility, whole-body scarring and a hypoxic brain injury. Trejo’s abilities to see, hear, smell, taste and touch have been severely diminished.
After hearing the evidence, the jury found that the labeling on Motrin was inadequate and should have been changed years earlier to properly educate and alert consumers to the developing signs of severe reactions, which include skin reddening, rash and blisters. Early detection and treatment of these symptoms can prevent TEN or SJS.
Apple Playing the Same Old tune? Apple, Inc., has agreed to settle a consumer fraud class action lawsuit that could amount to over $50 million dollars in payouts—but before you get all excited know this “Apple has agreed to provide an iTunes® Store credit in the amount of $3.25 to all settlement class members who qualify and submit a valid claim form. ” That’s the skinny.
The lawsuit claimed that Apple advertised and sold gift cards which stated that if one purchased and used the gift card, all songs purchased at Apple’s online iTunes® Store would cost 99¢ per song. The lawsuit further claimed that in April, 2009, Apple raised the price of certain songs at the iTunes® store, yet refused to honor the promised 99¢ price when the gift cards were redeemed. In addition, the company continued to sell iTunes® gift cards with the phrase, “Songs are 99¢” printed on them.
Consumers who were overcharged for iTunes songs while using iTunes® 99¢ gift cards are now eligible to receive an iTunes® Store credit in the amount of $3.25 after completing the simple iTunes® class action lawsuit online claim form. Millions of e-mails are currently being sent to persons who may have used affected gift cards to purchase songs from the iTunes® Store.
You can find out how to make an Apple iTunes lawsuit claim here.
Ok—That’s enough for this week. See you at the bar—don’t forget your iPod.
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