What’s your GM Vehicle Worth these Days? Less than it was a few months ago—according to a new class action lawsuit filed against General Motors Co., (GM) this week. The GM lawsuit follows the latest round of GM Recalls, alleging the automotive manufacturer’s reputation has been so badly damaged that even vehicles not included in the recalls have depreciated in value. The lawsuit is seeking in excess of $10 billion on behalf of all GM vehicle owners. The recalls allegedly constitute 25 percent more than what would be seen in a normal year, and almost 20 times more than the number or recalls issued during the same period in 2013, the lawsuit claims.
According to the GM lawsuit, GM marketed its vehicles as safe and reliable which mislead consumers into purchasing or leasing their cars, because the company was, at the same time, intentionally concealing known defects and valuing cost-cutting over safety, eventually leading all GM vehicles to depreciate in value due to its now-ruined brand.
“GM enticed … all GM vehicle purchasers to buy vehicles that have now diminished in value as the truth about the GM brand has come out, and a stigma has attached to all GM-branded vehicles,” the lawsuit states.
The lawsuit claims that the forced recalls of over 17 million vehicles has severely damaged the company’s reputation. According to the lawsuit there are about 40 different recalls covering 35 separate defects. All the recalls took place in the first few months of 2014.
“GM’s now highly publicized campaign of deception in connection with the ignition-switch defect sent shockwaves throughout the country, and jump-started the ever-burgeoning erosion of consumer confidence in the GM brand,” the complaint states.
The suit alleges that the 2010 and 2011 Chevrolet Camaro models have both been diminished between February, before the recalls began, and now, depreciating $2,000 in value. Further, the 2009 Pontiac Solstice went down $2,900 in value during that time, according to the lawsuit. According to the complaint, GM’s vehicles have depreciated in value because “no reasonable consumer” will pay the price they would have paid when the GM brand meant “safety and success.”
If certified, the class will represent GM consumers nationwide who own or lease a new or used vehicle sold between July 10, 2009, and April 1, as well as consumers who sold their GM vehicles at a “diminished price” on or after April 1. The class excludes consumers who own or lease certain Chevrolet Cobalt, Chevrolet HHR, Pontiac G5s, Saturn Ions and Saturn Sky vehicles.
The suit also seeks to certify a California subclass of GM vehicle owners and lessors, in addition to those who sold their cars at depreciated value.
The suit is Andrews et al v. General Motors LLC, case number 5:14-cv-1239, in the U.S. District Court for the Central District of California.
PetCode Problems? Heads up…Petco customers—they got zapped with Zip code class action this week. According to the proposed Petco class action lawsuit the animal supplies retailer is in violation of Massachusetts state law through their collection of customers’ zip codes.
According to lead plaintiffs Jeffrey Scolnick and Leah Crohn,Petco would not allow them to complete credit card purchases without their first providing the retailer with their ZIP codes, even though the store is not required by credit card issuers to collect this information from customers. Consequently, the plaintiffs allege they have received unwanted marketing materials from Petco. Further, they allege the store has sold their information to third parties without their consent and for marketing purposes.
“Petco recorded plaintiffs’ ZIP codes into an electronic credit card transaction form,” the complaint states. “Petco continues to store plaintiffs’ personal identification information, including plaintiffs’ name, ZIP code and credit card number, in its databases.”
The lawsuit, entitled, Scolnick et al. v. Petco Animal Supplies Store Inc., case number 1:14-cv-12547, states that Massachusetts’ high court has determined that ZIP codes constitute personal information under the Massachusetts Unfair Trade Practices Act, which prohibits the collection of personal information by retailers. Consumers place a high value on the privacy of their personal identifiable information, the lawsuit states.
The lawsuit seeks to represent all customers from whom Petco requested personally identifiable information when making a credit card purchase in Massachusetts, according to the complaint. The plaintiffs said they do not yet know the potential number of class members.
Best Buy done for less than Best Practices. Plaintiffs in a Telephone Consumer Protection Act TCPA class action lawsuit against Best Buy have finalized a $4.55 million settlement deal. The lawsuit, with a Washington state class of 439,000 members, and a national class of 42,000 members, was initially filed in April 2010 by Michael Chesbro who alleged Best Buy automatically signed customers up for its Rewards Zone program without their knowledge when they purchased electronics under a payment plan. Best Buy then made unsolicited phone calls to those consumers with information about that program.
According to the terms of the Best Buy settlement, filed June 9 in the U.S. District Court for the Western District of Washington, class members will receive their pro rata share from the settlement fund, once court-awarded fees, litigation and administrative costs and the class representative incentive award have been deducted. This will leave an estimated $3.2 million for distribution among class members, equally between $50 and $100 per call.
Michael Chesbro is to receive a $5,000 service award for services he has rendered to the classes by stepping forward to bring this case, according to the settlement papers.
Ok – Folks – we’re done here – have a great weekend and we’ll see you at the bar!
Supersize this baby! McDonald’s is facing an unpaid overtime lawsuit class action lawsuit brought by four former employees in the Los Angeles area. The lawsuit alleges McDonald’s Corp violated wage and hour laws by “requiring workers to work off the clock, placing their rest and meal breaks at the end of their shifts and not paying final wages in a timely manner.”
The McDonald’s lawsuit was originally filed by plaintiff Maria Sanchez in January 2013, but has subsequently been consolidated into a nationwide group of employment class actions against the fast food chain, all alleging illegal labor practices. The lawsuits claim that McDonalds’ managers falsified time records to erase certain employees’ actual hours of work, prohibited meal breaks, required unpaid work from employees before and after their shifts, and withheld overtime pay.
The lawsuit further alleges that McDonald’s Corporation has tried to reduce “labor costs by requiring its restaurants to limit labor costs to a specific percentage of gross sales, causing managers to violate state labor laws to keep costs in line.”
The case is Maria Sanchez et al., v. McDonald’s Restaurants of California Inc. et al., case number BC499888, in the Superior Court of the State of California, County of Los Angeles.
Um—I’m lovin’ It!
Is Merck & Co. Inc, full of S#$PF? According to a recently filed consumer fraud class action lawsuit—it would appear so. The lawsuit alleges the pharmaceutical company is overcharging for its Coppertone sunscreen products with Sun Protection Factors (SPF) of 55 and higher because they contain “virtually identical” active ingredients as the Coppertone SPF 50 products.
Filed by plaintiff Danika Gisvold, the lawsuit claims Merck is participating in a “false, misleading and deceptive” advertising campaign. Specifically, Gisvold alleges the US Food and Drug Administration has reviewed SPF ratings since 1978, and has found that SPF values over 50 don’t provide an increase in protection over SPF 50 products.
According to the Coppertone lawsuit, while SPF value is an indicator of the level of sunburn protection provided by the product, and consumers have learned over time to associate higher SPF with greater protection, the SPF 100+ products do not provide twice the ultraviolet B protection of an SPF 50 product.
“In fact, none of the sunscreen products in the Coppertone SPF 55-100+ collection provide any additional clinical benefit over the Coppertone SPF 50 products,” according to the complaint, which also notes that the FDA had voiced concern about labeling a product with a specific SPF value higher than 50. “The FDA’s findings are based on, inter alia, scientific tests that demonstrate SPF 100 sunscreens block 99 percent of UV rays, while SPF 50 sunscreens block 98 percent, an immaterial difference that provides no additional clinical benefit to consumers against sunburn.”
The Coppertone lawsuit alleges the only reason consumers would purchase an SPF product over SFP 55 is because they believe it provides greater protection than a lesser SPF product, therefore, Merck’s Coppertone SPF 55- 100 are overpriced. “As a result of Merck’s superior UVB protection claims, consumers, including plaintiff and members of the proposed class, have purchased products that do not perform as advertised,” the complaint states.
The plaintiff is seeking to represent a national class of plaintiffs claiming Merck’s representations of superior UVB protection are false, misleading and reasonably likely to deceive the public, and that Merck spreads the false claims through advertising inserts, the Internet and labels “where they cannot be missed by consumers.”
Of course, if you are really unsure about your SPFs, you could always wear long sleeves and a hat—but that just ain’t as sexy.
Well Lowe and behold…a $6.5 settlement has been reached in a class action lawsuit pending against t Lowe’s—the DIY guys. The deal, if approved, will resolve a labor law class action filed by two former contractors, Ronald Shephard and Henry Romines, who allege Lowe’s violated California labor law.
Specifically, the lawsuit states that Lowe’s treated the independent contractors as employees when they were retained to install garage doors. While Romines voluntarily dismissed the claims Shepard continued with the lawsuit, and the court certified certified a class of: “All persons who installed products for Lowe’s or performed services for Lowe’s in the State of California and who were treated as independent contractors by Lowe’s but over whom Lowe’s exercised control and discretion in the performance of their installation services.” The certified class period runs from 2008 to the present.
According to the Lowe’s lawsuit: “Specifically, plaintiffs assert that Lowe’s had the right to control, and in fact did control all aspects of installation services performed by Shephard and all other Type 1 and general contractor installers,” according to the settlement for preliminary approval proposed to the U.S Northern District Court of California, Oakland division.
“Plaintiffs further allege that Lowe’s misclassification of the installers caused harm not only to the installers who did not receive the benefits attendant with being treated as employees, but also resulted in harm to the installation companies that contracted with Lowe’s,” the lawsuit states.
In discussing the proposed Lowe’s settlement, Shephard’s attorneys write, “Shephard determined that if this action proceeded to trial and if Shephard prevailed on all of his claims, the maximum amount recoverable for the class would have been approximately $33 million. Shephard submits that a recovery of $6.5 million, or approximately 20 percent of the recoverable damages, is an eminently fair and reasonable recovery.”
It is estimated that some 4,029 individual installers and 949 installation companies are eligible to receive settlement funds, and “The maximum settlement amount equates to about $1,613.30 per settlement class member,” court documents state.
Ok, Folks—we’re done here—have a great weekend and we’ll see you at the bar!
Listerine Total Care Missing Something? Johnson & Johnson (J&J) and subsidiaries may have to rebuild their advertising campaign if the allegations in this latest consumer fraud class action lawsuit prove true. The lawsuit claims J&J et al falsely label Listerine Total Care products as being capable of restoring tooth enamel despite the “overwhelming consensus” of experts that tooth enamel loss is permanent.
Specifically, the Listerine lawsuit, entitled Suzanna Bowling v. Johnson & Johnson et al., case number 1:14-cv-03727, in the U.S. District Court for the Southern District of New York, claims that J&J, McNeil-PPC Inc., and Johnson & Johnson Healthcare Products label various Listerine products as capable of enamel restoration. Bowling, who filed the lawsuit, states that the misleading claims are “highly material” to consumers and served to differentiate Listerine’s Total Care line from other mouthwash products. Oh yes.
The lawsuit further claims that the Listerine Total Care labeling enabled the defendants to charge a 35.8 percent price premium for Total Care products. “In fact, Listerine Total Care is essentially identical to Listerine Fluoride Defense Anti-cavity Mouthwash,” the complaint, states. “Both products have the same active ingredient, in the same amount, the same indicated uses, the same warnings, the same directions, and the same inactive ingredients. There are only three differences between Listerine Total Care and Listerine Fluoride Defense: the packaging, the color, and the price.” Terrific.
Bowling seeks an order certifying the nationwide class and the New York subclass, an order finding in favor of the plaintiff and an order of restitution, as well as compensatory, statutory and punitive damages, prejudgment interest and injunctive relief.
Pharmasexist? Well…it’s been a while since we’ve heard about this one—a nationwide sex discrimination class action lawsuit against of Daiichi Sankyo Inc. It was certified this week. The collective action is brought by about 1,500 female employees of the pharmaceutical company, who claim they were paid less than their male counterparts for the same work.
The sex discrimination lawsuit was brought in February 2013, by current and former sales workers and are seeking more than $100 million in damages. Named plaintiff Sara Wellens and several other current or former Daiichi sales employees sought collective action certification in March under the Equal Pay Act.
FYI—the case is Sara Wellens et al. v. Daiichi Sankyo Inc., case number 4:13-cv-00581, in the U.S. District Court for the Northern District of California.
Pradaxa Settlement…Boehringer Ingelheim International GmbH looks set to pony up $650 million, after news a settlement deal has been struck—potentially ending claims in multidistrict litigation that its blood thinner Praxada (dabigatran) caused serious injuries including severe bleeding.
If approved, the Pradaxa settlement will resolve both state and federal personal injury lawsuits. Boehringer said in its statement that it expects the settlement will resolve roughly 4,000 claims over the drug, and noted that the US Food and Drug Administration has reaffirmed the drug’s positive benefit-risk profile.
During the past several years the number of Pradaxa lawsuits has increased, with users alleging they experienced bleeding events and other injuries associated with Pradaxa use. Lawsuits began to be filed in March 2012, according to court records, following the publication of a study in the Archives of Internal Medicine which linked Pradaxa with an increased risk of heart attack compared with other anticoagulants.
Boehringer received FDA approval in October 2010 for Pradaxa, to reduce clotting risks in patients with atrial fibrillation, an irregular heartbeat that causes problems with blood flow, that is not caused by a heart valve problem.
The case is In re: Pradaxa (Dabigatran Etexilate) Products Liability Litigation, case number 3:12-md-02385, in the U.S. District Court for the Southern District of Illinois.
Ok – Folks – we’re done here – have a great weekend and we’ll see you at the bar!
Heads Up Google AdWords Users…Google’s been hit with a national unfair business practices class action lawsuit alleging the god of all things Internet unlawfully denies payments to thousands of website owners and operators who place ads on their sites sold through Google AdWords.
The Google AdWords lawsuit, filed in the U.S. District Court for the Northern District of California, alleges that Google abruptly cancels website owners’ AdSense accounts often without explanation shortly before payments are due, and refuses to pay for the ads that ran prior to the cancelation.
According to the lawsuit, Google’s popular AdSense program translates annually to billions of dollars payable to website operators that host its ads via AdSense. Google’s AdSense advertising program induces website operators to host space for ads on their websites. Each time a visitor to the website interacts with the ad, the ad publisher who hosts the ad earns payment.
The complaint claims that the contracts and terms of service Google requires web publishers to sign are unconscionably one-sided, giving Google free reign to embark on what the lawsuit claims are actions devoid of good faith or fair dealing.
The complaint states, “Given Google’s contractual terms purportedly permitting it to withhold payment to publishers with disabled accounts, and in light of the experience of the plaintiff in seeing this policy actually effected, the total of earned funds that Google has refused to pay its AdSense publishers could be enormous.”
The lawsuit claims Google is in violation of contracts with users and in violation of the implied covenant of good faith and fair dealing, unjust enrichment, and violation of the California Unfair Competition Law.
The named plaintiff, Free Range Content, Inc., is a California corporation that owns and operates Repost.us. Free Range Content first noticed a spike in AdSense earnings in Feb. 2014. At the end of Feb. 2014, Google issued a report stating that the plaintiff’s estimated earnings for the covered period were over $40,000–a number that seemed far too high. Then on March 4, 2014, two days before a scheduled March 6, 2014 call with an AdSense representative was slated to occur, the plaintiff received word from the AdSense program that Google had disabled its account.
The lawsuit seeks damages for all U.S. Google AdSense publishers whose AdSense account was disabled or terminated, and whose last AdSense program payment was withheld permanently by Google.
Major RICO settlement this week…thought to be among the largest civil Racketeer Influenced and Corrupt Organization Law (RICO) class action settlements in recent history: We’re talking $297 million—a preliminary agreement between plaintiffs in a multidistrict unfair business practices class action against U.S. Foodservice, Inc. and its former parent company, Koninklijke Ahold, N.V. The settlement agreement is pending approval by the United States District Court for the District of Connecticut.
This US Foodservice agreement was reached on behalf of a class of customers, primarily hospitals and restaurants, who purchased products from U.S. Foodservice under cost-plus arrangements between 1998 and 2005.
The class claimed that it was defrauded by U.S. Foodservice when it created six companies that it controlled to inflate the “cost component” of the products that were subject to the arrangement.
Citigroup Employee Shareholder Settlement…Bank employees got screwed too—and this week they got some justice, with the agreement of a $8.5 million settlement ending a securities class action lawsuit pending against Citigroup. The lawsuit, brought by Citigroup employee shareholders, alleged the company concealed its exposure to subprime mortgages prior to its stock price dropping.
The settlement class includes over 7,000 Citigroup employees who acquired securities between November 2006 and June 2009. Yikes! The damage seems endless. Probably is.
Under the terms of the agreement a $2.3 million settlement fund will be established, to include six payments of approximately $50,000 each to the six lead plaintiffs, as an incentive award for their service to the case. The Erisa lawsuit was brought in 2009 by former Citigroup employees who alleged the company prevented employees who had purchased the bank’s stock from obtaining information about subprime losses by means of a series of materially misleading statements and omissions concerning its subprime exposure, overall business outlook and financial results.
The lawsuit was originally filed in California, but was later consolidated into a multidistrict securities litigation against Citigroup through New York.
Ok—Folks—we’re done here—have a great weekend and we’ll see you at the bar!
Is your air conditioning unit blowing a little defective hot air? Well, according to a class action lawsuit filed against Goodman Global, Inc., and certain affiliated companies, their central air conditioning units and heat pumps sold under the Goodman® and Amana® brands since 2007 are—defective that is. The bit that’s causing the alleged problems is the evaporator coil(s).
For those of us not intimately acquainted with the working innards of an air conditioning unit (most of us, I’m guessing) evaporator coils are generally located inside a consumer’s home and are essential to the proper functioning of any central air conditioning system or heat pump.
So–according to the lawsuit, Goodman and Amana central air conditioning and heat pump systems contain defective evaporator coils that improperly and prematurely leak refrigerant (a.k.a. Freon®). Oh that’s good. Not. The defect allegedly renders the systems inoperable because the cooling cycle will not work without refrigerant.
Although Goodman sells these units with a warranty, that warranty is limited in a way that provides insignificant protection to owners of the units. In particular, the Goodman warranty, by its terms, covers replacement parts, but not the labor costs associated with the replacement. According to the lawsuit, the result is that, when a defective evaporator coil fails, Goodman provides the owner with a replacement coil, but does not pay to have the old coil removed or the replacement coil installed. As alleged in the lawsuit, those labor costs typically run in the hundreds of dollars, and in some cases, thousands of dollars. Thus, in at least some instances, the owner is forced to spend as much or more to replace the defective evaporator coil as the cost to purchase a new Goodman unit.
The complaint also alleges that Goodman has known that its units sold since 2007 contained defective evaporator coils, but the company failed to inform consumers about the problem or issue a recall. Indeed, according to the lawsuit, Goodman continued to tout the quality of its air conditioning systems, claiming they were durable, dependable, and long lasting, even though it was aware that the defective evaporator coils would cause the units to fail prematurely and at rates far above the industry average.
The lead plaintiff in the case acquired his Goodman unit when he purchased his new house in September 2011. According to the lawsuit, in or about July 2013, after only one summer of use, the unit stopped cooling the plaintiff’s home. A service technician allegedly found that the unit was low on refrigerant and added four pounds of refrigerant, which immediately leaked out of the system. After observing this, the technician determined that the evaporator coil was leaking and needed to be replaced. According to the complaint, the service technician returned the old defective evaporator and replaced it with a new one, charging plaintiff approximately $650 for this service.
The civil action was filed on behalf of all consumers in North Carolina that purchased a central air conditioning unit or heat pump bearing the trade names Goodman® and Amana® from 2007 to the present.
GM—AGAIN! GM just cannot seem to get it right these days. No, this time it’s not the auto recalls…this week their loan re-financing subsidiary got hit with a class action lawsuit alleging violations of the Telephone Consumer Protection Act (TCPA).
Brought by Monique Perez of California, the GM lawsuit claims that beginning in late 2013, General Motors Financial Co. Inc. made “virtually daily incessant calls” to Perez’s cellphone regarding a debt allegedly owed by another person named “Melanie.”
Perez claims that by calling from an automatic telephone dialing system (ATDS), which can store or produce telephone numbers to be called using a random or sequential number generator, GM Financial violated the TCPA. Don’t you love technology?
According to the lawsuit, “Plaintiff has never provided any personal information, including her cellular telephone number, to defendant for any purpose. As such, neither defendant nor its agents were provided with prior express consent to place calls via its ATDS to plaintiff’s cellular telephone.”
The plaintiff alleges members of the class not only suffered privacy violations but also suffered cellular telephone charges or saw a reduction in cellular telephone time that had already been paid for.
Perez is seeking to represent a putative class, made up of all US residents who received any telephone call from the company to a cellphone through the use of an ATDS within the past four years. She is seeking $500 per negligent violation and $1,500 per knowing or willful violation of the TCPA for each class member.
So it was all corn after all… Kellogg’s, the maker of Kashi products, has agreed to a $5 million settlement, potentially ending a consumer fraud class action lawsuit that claimed Kashi’s labeling was misleading and fraudulent. Wait—don’t tell me—this stuff is so natural it makes Mother Nature look fraudulent—right?
Right. The Kashi lawsuit alleged that labeling on certain products used labels stating “All Natural” or “Nothing Artificial,” when in fact the products contain a variety of synthetic and artificial ingredients, such as pyridoxine hydrochloride, calcium pantothenate, hexane-processed soy ingredients, ascorbic acid, glycerin and sodium phosphate.
Under the terms of the settlement, Kellogg’s has also agreed to stop using the labels “All Natural” and “Nothing Artificial”. In a statement, Kellogg Co. said it stood by its advertising and labeling practices but that it would change its formulas or labels on Kashi products, nationally by the end of the year.
The settlement was filed May 2 in U.S. District Court in California and is subject to court approval.
Ok Folks—we’re done here—have a great weekend and we’ll see you at the bar!