Emerging Issues

Week Adjourned: 1.6.12

A wrap of the week’s top class action lawsuits and settlements for the week ending January 6, 2012.

Top Class Actions

Pay your staff overtime? Just do it! A former employee of the San Francisco NikeTown Store has filed a wages and overtime class action complaint against Nike alleging that the sporting goods manufacturer failed to compensate him for overtime, meals and rest breaks as well as any additional shifts he worked. The lawsuit has two (2) potential classes: “All employees of Defendants who worked as Sales Associates, or any other non-exempt job position, who were subject to Defendants’ policy of searching Defendants’ employees upon exiting one of Defendants’ store locations in California from December 28, 2007, to the date of filing this Complaint.” This group is hereinafter referred to as the “California Class.” This period of time is hereinafter referred to as the “California Class Period.”

And, “All employees of Defendants who worked as Sales Associates, or any other non-exempt job position, who were subject to Defendants’ policy of searching Defendants’ employees upon exiting one of Defendants’ store locations in the United States of America from December 28, 2008, to the date of filing this Complaint.” This group is hereinafter referred to as the “Nationwide Class.” This period of time is hereinafter referred to as the “Nationwide Class Period.”

The employment lawsuit was filed by Webster Proctor, on behalf of himself and behalf of others similarly situated. According to the complaint, Proctor was employed by Nike from approximately April 2010 until approximately May 2011. During that time he alleges in the lawsuit that he generally worked four (4) 8-hour shifts per week and was deprived of pay for all the hours he worked, meal and rest breaks, and proper overtime pay.

Specifically, the wages and hour class action lawsuit alleges: failure to compensate employees for all hours worked; failure to pay overtime; failure to provide meal and rest periods; failure to furnish accurate wage statements; failure to maintain employee time records; and unfair competition.

Top Settlements

Is it snake oil? An unfair business practices lawsuit against dietary supplement distributors Iovate Health Sciences Inc., and Iovate Health Sciences USA Inc., look certain to be settled as the companies have agreed to pay $1.5 million in civil penalties and costs. This is reportedly the second largest multidistrict attorney dietary supplement settlement of its kind in California.

The lawsuit was brought by the District Attorney’s Office in Santa Cruz, Napa, Alameda, Marin, Monterey,

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Week Adjourned: 12.9.11

A wrap-up of the week’s top class action lawsuits and lawsuit settlements, for the week ending December 9, 2011.

Top Class Actions

Seems Green Mountain may have been Roasting More Than Coffee. The company got hit with a securities class action lawsuit this week alleging it has been cooking the books.

The class action is brought against GMCR, certain of its officers and directors, and the underwriters of the Offering for violations of the Securities Act of 1933 and the Securities Exchange Act of 1934. GMCR, based in Waterbury, Vermont, is a leader in the specialty coffee and coffee maker businesses.

FYI—GMCR produces coffee, tea and hot cocoa from its family of brands, including Tully’s Coffee(R), and manufactures the popular Keurig single-cup brewing systems that use “K-Cup” portion packs.

The lawsuit alleges that, during the Class Period, certain defendants systematically and strategically manipulated GMCR’s revenues. To do so, defendants used one of GMCR’s key fulfillment vendors, M. Block & Sons (“MBlock”), as a captive warehouse to harbor expired, excessively manufactured, or otherwise unsold product. Pursuant to the fraudulent scheme, GMCR improperly booked revenues associated with falsified sales orders for hundreds of millions of dollars in K-Cup and Keurig Brewer products, which resulted in the material overstatement of the Company’s profits, inventory, and product demand levels. GMCR also fraudulently overstated its assets in proportion to its fictitious revenues by carrying the proceeds of phantom sales as assets on its balance sheet throughout the Class Period.

On October 17, 2011, David Einhorn, a prominent activist investor, released a comprehensive report, including witness testimonials by former GMCR and MBlock employees, disclosing GMCR’s misconduct and questionable relationship with MBlock. Following the release of the report, the price of GMCR shares fell approximately 10% from its closing price of $92.09 on October 14, 2011 to close at $82.50 on October 17, 2011, the next trading day, on unusually heavy trading volume.

On October 19, 2011, after Einhorn’s presentation was more widely distributed, the price of GMCR common stock fell another 15% to close at $69.80 on October 19, 2011, on unusually heavy trading volume.

Finally, on November 9, 2011, GMCR announced disappointing earnings results and skyrocketing inventory. On this news, GMCR shares dropped 40%, from a close of $67.02 on November 9 to a close of $40.89 on November 10, 2011, on extremely heavy trading volume.

The securities lawsuit has been brought on behalf of purchasers of the common stock of Green Mountain Coffee Roasters, Inc. (“GMCR” or the “Company”) between February 2, 2011 and November 9, 2011, inclusive (the “Class Period”), including purchasers of GMCR’s common stock pursuant and/or traceable to the Company’s public offering on or around May 5, 2011 (the “Offering”).

Top Settlements

HRT Breast Cancer Settlement. This one was all over the news this week. Three women who filed lawsuits against Wyeth Pharmaceuticals and Pharmacia Upjohn alleging that their diagnoses of breast cancer were directly attributable to their use of Hormone Replacement Therapy (HRT) drugs, were awarded $72.6 million by a jury in Philadelphia hearing their consolidated lawsuit. The jury awarded $20 million to Ms. Elfont, $27.85 million to Ms. Kalenkoski and $24.75 million to Ms. Mulderig, according to the plaintiffs’ attorneys.

The three women filed individual lawsuits in July 2004 against Wyeth Pharmaceuticals and Pharmacia Upjohn, both of which have since been acquired by Pfizer.

The back story, in brief, is that Elfont, 66, had taken hormone therapy drugs for over two years before being diagnosed with breast cancer in 1997. Sixty-eight year old Kalenkoski was diagnosed with breast cancer in 2002, having taken Prempro for over four years, while Mulderig, also 68, took Premarin and Provera for 11 years before she received her breast cancer diagnosis, the PennRecord reported. It’s tragic and shocking.

According to a Bloomberg News report, Pfizer’s Wyeth and Upjohn units have lost 10 out of the 18 hormone therapy cases against them in civil court trials since 2006. Earlier this year Pfizer announced it had settled a third of the pending Prempro cases, it had set aside $772 for related claims, Bloomberg reported.

Another Bank Biggie this Week… Bank of America (BofA) agreed a $315 million settlement in a securities fraud class action lawsuit that alleged the bank was misled about mortgage-backed investments sold by its Merrill Lynch unit. The settlement needs court approval in order to fly–and guess who’s making that decision? US District Judge Jed Rakoff–so all bets are off that this one get’s approved…

The Public Employees’ Retirement System of Mississippi pension fund led the lawsuit, alleging that the investments contained questionable subprime mortgages written by lenders Countrywide Financial Corp., First Franklin Financial, and IndyMac Bancorp – IndyMac went under in 2008.

Ok – That’s enough for this week. See you at the bar.

Week Adjourned: 12.2.11

A wrap-up of the latest class action lawsuits and settlements for the week ending December 2, 2011

Top Class Actions

Are your text messages being traced–by your own hand, so to speak? Ten years ago this would have been the stuff of a James Bond film. Today, sadly, it seems to be business as usual–or more accurately—if you can get away with it…

A group of consumers filed a nationwide class-action lawsuit this week, alleging that smartphone manufacturers HTC Corporation, HTC America, Inc. and Samsung Electronics Co., Ltd use software developed by Carrier IQ, Inc. (“CIQ”) that illegally intercepts incoming text messages and captures users’ key strokes—including those used to compose email and text messages or to dial numbers—without consumers’ knowledge or permission. The lawsuit asks the court to award damages under the Federal Wiretap Act, and prevent companies from including similar software in future smartphones.

The back story—in mid-November, software developer Trevor Eckhart published a video blog illustrating the operation of the CIQ software recording keystrokes, including information sent to secure websites using HTTPS security protocols used in e-commerce and other security-sensitive sites.

After Eckhart published his discovery and documents he found on CIQ’s website, CIQ accused him of copyright violations and threatened legal actions unless he capitulated to the company’s demands. The Electronic Frontier Foundation, a public-interest digital rights watchdog stepped in to defend Eckhart and CIQ later apologized to Eckhart and rescinded its demands.

According to CIQ, its software is embedded on smartphones to allow the company to collect data for the benefit of cellular carriers and device manufacturers, which is important to improving customer experience, such as logging information related to dropped calls. CIQ says its program does not log keystrokes or intercept messages and it does not store or resell the information.

The lawsuit alleges that, in reality, the program does record keystrokes and the content of messages, and could transmit the information to third parties, possibly including information sent to secure websites using HTTPS security protocols used in e-commerce and other security-sensitive sites such as banking.

The complaint was filed on behalf of four smartphone users and names smartphone manufacturers HTC and Samsung as defendants along with CIQ. The lawsuit could be amended to include other smartphone manufacturers that embed the CIQ software on their devices.

The suit, filed in the U.S. District Court for the Northern District of California, accuses the companies of violating the Federal Wiretap Act and California’s Unfair Business Practice Act. The Federal Wiretap Act prohibits the unauthorized interception or illegal use of electronic communications.

Very creepy.

Top Settlements

Could this be a Christmas Bonus? Borders Group Inc has agreed to settle an employment class action lawsuit brought by 198 former employees over Borders’ alleged violations of the Worker Adjustment Retraining and Notification (WARN) Act.

Borders, unfortunately, is in the last stages of liquidation, but has agreed to pay $240,000 as settlement to the former employees who claim they were laid off without sufficient notice, violating federal regulations. After legal fees are deducted, reports indicate that each plaintiff could receive $797. The lawsuit was filed by former employees of Borders’ Ann Arbor headquarters, led by an employee named Jared Pinsker. According to the settlement filing, the parties agreed to settle their dispute to avoid a protracted and costly legal battle.

Borders, which finished closing its stores and liquidating its inventory in September, filed for Chapter 11 bankruptcy protection in February. The company converted its case into a Chapter 11 bankruptcy liquidation in July. A U.S. bankruptcy judge in Manhattan must approve the settlement. Fingers crossed on this one.

Citigroup Settlement Update. Here’s an update on a proposed settlement we wrote about in late October, involving Citigroup and allegations of investor fraud. Judge Jed Rakoff, of the infamous New York Southern District, has rejected a proposed $285M settlement offered by Citigroup to end an civil complaint brought by the Securities & Exchange Commission (SEC) over allegations that they defrauded investors through highly risky mortgage-backed investments. The specific transaction referred by the SEC involved a $1 billion portfolio of mortgage-related investments. (Anyone seen “Margin Call”?)

According to a report by Forbes, “Rakoff is a critic of the custom that allows firms to use their pocketbook to settle charges rather than admitting guilt, and said there is a public interest in finding out the truth.” Consequently, Rakoff has scheduled a trial, for July 16, 2012. However, the SEC and Citi could bring a settlement to the table prior to that, again pending judge’s approval, which, if approved would keep the case out of court. Me thinks an example may be made here.

Ok–That’s enough for this week. See you at the bar.

Week Adjourned: 8.12.11

Top Class Actions

Latest Book Club? Apple, and some the publishing industry’s biggest names got hit with a nationwide antitrust class-action lawsuit this week, over allegations that they conspired to fix prices in electronic books (e-books)–at least that’s the short version.

According to published info, Apple Inc., HarperCollins Publishers, a subsidiary of News Corporation, Hachette Book Group, Macmillan Publishers, Penguin Group Inc., a subsidiary of Pearson PLC, and Simon & Schuster Inc., a subsidiary of CBS, colluded to increase prices for popular e-book titles to boost profits and force e-book rival Amazon to abandon its pro-consumer discount pricing. Nice!

Here’s the skinny: the publishers believed that Amazon’s enormously popular Kindle e-reader device and the company’s discounted pricing for e-books would increase the adoption of e-books, and feared Amazon’s discounted pricing structure would permanently set consumer expectations for lower prices, even for other e-reader devices.

So, according to the lawsuit, the five publishing houses forced Amazon to abandon its discount pricing and adhere to a new agency model, in which publishers set prices and extinguished competition so that retailers such as Amazon could no longer offer lower prices for e-books. That’s anti-free market for sure!

If Amazon attempted to sell e-books below the publisher-set levels, the publishers would simply deny Amazon access to the title, the lawsuit states. The defendant publishers control 85 percent of the most popular fiction and non-fiction titles. Lawyers for the plaintiffs note that while Amazon derived profit from the sale of its Kindle and related accessories, likely allowing the company to discount e-books, Apple was steadfast in maintaining the 70/30 revenue split it demanded with its App Store.

Still with me? Read on…

While free market forces would dictate that e-books would be cheaper than the hard-copy counterparts, considering lower production and distribution costs, the complaint shows that as a result of the agency model and alleged collusion, many e-books are more expensive than their hard-copy counterparts.

As a result of the pricing conspiracy, prices of e-books have exploded, jumping as much as 50 percent. When an e-book version of a best-seller costs close to—or even more than—its hard-copy counterpart, it doesn’t take a forensic economist to see that this is evidence of market manipulation, lawyers for the plaintiffs note. For example, “The Kite Runner” costs $12.99 as an e-book and only $8.82 as a paperback.

The lawsuit goes on to claim that because no publisher could unilaterally raise prices without losing sales, they coordinated their activities, with the help of Apple, in an effort to slow the growth of Amazon’s e-book market and to increase their profit margin on each e-book sold.

The lawsuit claims Apple and the publishers are in violation of a variety of federal and state antitrust laws, the Sherman Act, the Cartwright Act, and the Unfair Competition Act.

Once approved, the lawsuit would represent any purchaser of an e-book published by a major publisher after the adoption of the agency model by that publisher.

Does this affect you?

Top Settlements

Pharma Sales Reps Score One—in Overtime. Well now—here’s a great big slice of sunshine for all those hardworking pharmaceutical representatives. Schering Plough’s reps have won a complete victory in Federal Court in a nationwide collective lawsuit alleging unpaid overtime pay at the mandatory rate of time and one half. The federal class action was filed on behalf of all pharma reps who worked for SP during the last three years, anywhere in the United States.

No numbers have been made public as yet—but the press release states “The amount to be distributed to the class will be determined by the Court, but will likely include double damages for the violation.”

Apparently, the US Department of Labor recognizes that pharmaceutical reps are not exempt from overtime pay, and that the precedent for the class claim was set in the U.S. Court of Appeals for the Second Circuit, which found earlier this year that Novartis pharma reps were entitled to overtime compensation on the same grounds alleged against Schering Plough.

The US Supreme Court refused to hear the drug companies’ appeals. Saving tax payer dollars—always a good thing. The Second Circuit issued a similar ruling in a case brought by pharma reps against Schering Plough, as have district courts in Connecticut, Illinois, Florida and Texas in cases against Boehringer Ingelheim, Abbott, and Auxilum Pharmaceuticals. However, this ruling is the first of its kind as it found that pharma sales reps are not exempt under any of the parts of the exemption. Schering had to prove all the parts of the exemption, but it lost on all points.

Congratulations!

$5 Million Drunk Driving Accident Judgment. I wonder how many people are affected by drunk drivers? This guy certainly was. Twenty-two year old Dwight Grant—he was 22 in 2007 at the time of the incident—sustained brain damage as a result of an accident caused by a drunk driver. He was recently awarded $5 million in settlement of his personal injury lawsuit.

Apparently, he was a passenger in stopped vehicle when the vehicle was struck by Mathew Lyons who was being chased by the police. After hitting the car Grant was in, Lyons fled the scene.

Grant suffered fractures to his face and skull, which resulted in his sustaining brain damage, specifically, damage to his frontal lobe. This damage, Grant alleged, caused him a seizure disorder that now requires constant care.

The parties ultimately agreed to a $5 million final judgment.

OK. That’s it for this week. See you at the Bar—I’m taking a taxi.

Week Adjourned: 7.1.11

Top Class Actions

Best Buy BOLO a NO-GO. Best Buy got hit this week with another potential class action—another discrimination lawsuit—but this time it’s all about you —the customer…

The nation’s largest electronics retailer is facing alleged discrimination in in the form of customer racial and ethnic profiling. Ah, make that widespread racial and ethnic customer profiling in the District of Columbia and Virginia. The lawsuit was brought by an Arab American Muslim manager, Todd Abed, who was fired for protesting the practice, known internally as “BOLO”. Abed accuses Best Buy of terminating his 13-year career with the company because he objected to his district office’s “Be On the Look Out” policy (BOLO).

So, the allegations go that under BOLO, Best Buy employees circulated e-mails among all managers in the region containing images and descriptions of customers suspected of theft, intended to be posted in their respective stores. According to the lawsuit, the images and descriptions circulated under BOLO consistently involved racial and ethnic minorities who had done nothing to merit suspicion, accompanied by racially-tinged descriptions such as “bearded Middle Eastern guy who looked shady” or “black ghetto guy.” Really?

Abed, a supervisor in charge of loss prevention (read ” theft”), claims he refused to post the discriminatory emails. When this refusal became known to the district staff, they twice denied Abed promotions to General Manager—despite his being the most qualified applicant—and directed Abed’s new General Manager to trump up a reason to terminate him, according to the complaint.

The new General Manager, in turn, allegedly told Abed he would create a “paper trail” to have him fired, taunted his religion, sabotaged performance evaluations, placed him under a pretextual disciplinary “Action Plan,” and ultimately terminated him for allegedly poor performance.

The lawsuit seeks $1 million in damages and attorneys’ fees and costs. Most importantly, Abed seeks a court order permanently ending Best Buy’s customer profiling practices, which he believes continue to this day.

Top Settlements

Pond Drowning Case Settled. This is very sad. The family of a small boy who drowned in a pond while trying to save his younger brother who had also fallen in the pond, has been awarded a $30.7M settlement. The family had filed a premises liability lawsuit.

The story is devastating. Apparently, in 2001, Andrew Kennedy, who was just 11 years old at the time, tried to save his 10-year old brother James who had fallen through an ice-covered pond. Andrew drowned and James suffered severe brain damage. Andrew’s twin brother, Christopher Kennedy, claimed emotional and psychological trauma from witnessing the incident. And the parents alleged that the property owner, Lakes of the Four Seasons Property Owners Association Inc., did not have warning signs in place notifying the public of the dangers, nor did they try to restrict access to the pond. The family also claimed that Four Seasons failed to provide safety devices nearby. A cautionary tale…but at what price?

AON Account Specialists Settlement. And for all those ‘misclassified’ AON employees—justice at last. Los Angeles Superior Court judge gave final approval this week to a $10.5 million settlement of the employees overtime class action.

The story here is that California Account Specialists, whose work involves assisting Account Managers in providing insurance brokerage services to Aon’s clients, were misclassified by the defendant as exempt administrative employees. So the California Account Specialists filed a lawsuit—way back in 2007. And wouldn’t you know it, as the case was preparing for trial, the parties were able to reach a settlement. The settlement covers 534 class members, and best guess is they could have their money within 60 days.

OK. That’s it for this week. See you at the Bar.

Week Adjourned: 6.11.11

Top Class Actions

Never mind what’s in your wallet…Capital One could be more concerned with what’s left in theirs soon, as it seems they may have been doing a little corporate pick pocketing… it’s very popular these days. A lawsuit seeking class action status was just filed alleging Capital One (NYSE:COF) misrepresented its “Transfer Balance Program” program, resulting in higher-than-expected interest rates for consumers.

The case, filed June 9, 2011, in the United States District Court for the Eastern District of Michigan, alleges that Capital One deceived cardholders by claiming that a cash advance obtained through the company’s transfer balance program would include a 0 percent Annual Percentage Rate (“APR”) for one year. The company also allegedly promised that credit balances on regular monthly purchases (“purchase balances”) would incur no interest as long as the balance was paid within 25 days.

However, according to the complaint, cardholders who took advantage of the transfer balance program were charged interest rates exceeding 13 percent on their purchase balances, even if the balance was paid on time, because payments were applied to the transfer balance rather than to the purchase balance.

The lawsuit alleges that Capital One’s actions constitute a breach of contract and the duty of good faith and fair dealing, in addition to violations of the Virginia Consumer Protection Act and the Michigan Consumer Protection Act. The case also argues that Capital One received unjust enrichment through the alleged scheme.

Ah yes, unjust enrichment…that old chestnut. Seems it never grows old.

Top Settlements

One for the Madoff Meter… While we’re on the subject of things financial—a settlement was recently reached between a group of investors and HSBC Holdings PLC, with Europe’s largest bank agreeing to pay $62.5 million to the investors, who allegedly lost money in association with a Madoff securities fraud.

It seems that the investors had placed funds with Ireland-based Thema International Fund Plc, the assets of which were held with Bernard L. Madoff LLC, according to a statement by HSBC. Bloomberg reports “Thema Fund, a so-called Madoff feeder fund, was controlled by Bank Medici AG. Bank Medici with its founder Sonja Kohn is part of a $59 billion suit by the trustee liquidating Madoff’s firm.” This has to be one of the worst trustee jobs in history, I would think.

Reportedly, Thema was one of several funds placed in the custodianship of HSBC units, which subsequently funnelled monies to Madoff. The settlement is pending court approval.

A statement issued by HSBC stated that the settlement “shall in no way be construed” as an admission of fault. HSBC still faces other Madoff-related lawsuits in other countries including Germany, and Luxembourg. It’s the never ending story. 

And it’s a victory for the Ladies. A federal judge in Washington has approved a $32 million settlement of a class action brought against Wells Fargo Advisors by a group of women who alleged gender discrimination.

Reportedly, some 3000 female financial advisors make up the class. The suit was filed in 2009 by three female financial advisors who worked at Wachovia Securities. According to a report in the Wall Street Journal the women claimed that compared with their male counterparts, female advisors were provided fewer business opportunities by the company. The women also claimed that female advisors were at a disadvantage in other ways, specifically with respect to career advancement, work assignments and distribution of accounts.

The class covers all women who were employed as financial advisors by Wachovia or Wells Fargo at any time between March 17, 2003, and January 25, 2011, which is the date a preliminary approval was reached. The class also covers women who were employed by Wells Fargo Investments LLC and women who were employed as advisors by Prudential Securities Inc. or A.G. Edwards & Sons Inc. as of the dates those companies merged with Wachovia. I wonder who’s next?

OK. That’s it for this week. See you at the Bar.

Week Adjourned: 4.29.11

Top Class Actions

DIRECTTV in Direct Line of Fire over alleged dodgy business practices. A lawsuit by DIRECT TV customers who were illegally charged “early cancellation penalties”—fees of up to $480—has been granted “class action” status by a California court, potentially leading to millions of dollars in refunds.

FYI—DIRECTTV is the largest satellite TV provider in the US with over 16 million customers. Doesn’t take a rocket scientist to figure out that even a portion of that number of plaintiffs could translate to a rather large settlement.

The suit, filed in September 2008, was certified April 22, 2011, on behalf of DIRECTTV customers who were charged a cancellation penalty when they cancelled service. DIRECTTV applied its unlawful penalty provision to all of its customers including, in some cases, customers who terminated because the satellite equipment stopped working or they were no longer able to receive service when they moved.

In other cases DIRECTV would unilaterally extend a consumer’s “programming commitment” by a year or two if malfunctioning equipment needed to be replaced or the customer decided to upgrade receivers and then charge the fee if the customer stopped service after that. In some cases, according to the suit, DIRECTTV took the fees from their customers’ bank or credit card accounts without their permission.

Did any of this happen to you?

Top Settlements

Insured now Assured. Here’s a happy ending to a rather nasty insurance scam. National Western has agreed to pay more than $17 million to settle a class action lawsuit it faced over allegations that it targeted senior citizens—unfairly.

Short version—the suit alleged that National Western set up an unlawful group annuity policy that was issued through an out-of-state group created by National Western, and that the Continue reading “Week Adjourned: 4.29.11”

Week Adjourned: 3.25.11

Top Class Actions

Faulty Wiring? There were some interesting suits this week. Among them—this one against AT&T, filed by an 82-year old woman who alleges that the $9.99 she pays every month for an “Inside Wire Protection Plan” is a service she doesn’t need and can’t use because she lives in an apartment building in which she doesn’t own the interior telephone wires. Therefore, she has no legal responsibility for maintaining them and therefore she should not have to pay the $9.99 demanded by AT&T. Who knew?

But that seemingly small monthly charge adds up to about $120 a year, and it’s being paid by thousands of AT&T customers across the US, who are in similar situations to Gloria Girton.

Consequently, Ms. Girton has filed a class action in the US District Court for the Eastern District of North Carolina to end AT&T’s unlawful practice of wrongfully billing for such plans nationwide. Outside of North Carolina, they are known by such names as “Wire Pro,” “Inside Wire Maintenance,” and “Home Wire Protection.”

AT&T is illegally charging many of its land line customers who live in multi-tenant facilities for unnecessary wire insurance, the plaintiff’s lawyers state. “The company knows from prior litigation and its own internal investigations that this charge is improper, yet it continues to charge building tenants like Gloria for these worthless plans through deceptive sales actions that defraud and rob them of their hard-earned financial resources. We believe she and the class have sustained damages of at least $10 million and very likely much more,” says plaintiff’s counsel.

The complaint asks for the certification of two classes, a North Carolina class and a nationwide class, each comprised of all residents of residential or commercial property who had an AT&T account at any time in the past four years and were not responsible for the maintenance of their residence’s interior wire, but were charged a fee for an Inside Wire plan. You go Gloria!

Top Settlements

Press Brake Operator Verdict. A laborer in Florida has won his personal injury case with the jury awarding him a $3.3 million verdict. What happened? Sadly, he who suffered amputation of all the fingers on his right hand—which is the hand he wrote with. It was a workplace accident, involving a mechanical press in 2005.

Phiteau Dalien had his hand caught in a vintage 50-ton mechanical press brake he was operating for List Industries Inc. As a result his hand was crushed and he and he had to have his fingers amputated. He was 33 years old at the time. He underwent a subsequent surgery to build a partial thumb, and he may need another operation to try and rebuild his other fingers.

In his suit, Dalien alleged that the outdated machine he was operating for List Industries lacked safety features and that a language barrier prevented him from being properly trained. List Industries claimed the accident was caused by operator error. Of course they did. But the jury wasn’t buying.

Getting Royally Stiffed? Not any more for about 25,000 landowners in Pennsylvania. They brought a class action brought against Texas-based Range Resources in 2008 over allegations that the company was miscalculating their royalty payments associated with the company’s current drilling in the Marcellus Shale region of the state. Land which these people presumably own. The suit also alleged that Range Resources improperly withheld management fees from royalties and failed to account to landowners for money it had collected from selling oil and residual by products of gas processing.

A settlement has now been approved by a federal judge and the terms dictate that Range Resources, will pay the landowners roughly $1.3 million now and subsequently increase the royalty payment to a maximum of $16.6 million over the next five years, according to court documents. Well Done.

Okee dokee—that’s it for this week. See you at the bar.

Week Adjourned: 2.11.11

Top Class Actions

Proctor & Gamble in a fix over Fixodent—they got hit with a class action lawsuit this week over allegations that their product caused the plaintiffs neurological illness.

According to an investigative report by ABC News, the two lead plaintiffs, Mark Jacoby of New York and Anne Coffman of Maine, are both wheelchair bound as a result of being exposed to high levels of the mineral zinc—also known as zinc poisoning. Zinc poisoning interferes with the ability of the body to absorb copper. Both Jacoby and Coffman, and their respective physicians reportedly believe that their health problems are a result of the zinc found in Fixodent.

Just in case zinc poisoning is news to you—a paper published in Neurology in 2008 showed that “Denture cream contains zinc, and chronic excessive use may result in hypocupremia and serious neurologic disease.” In 2009, Proctor & Gamble updated the warning label on Fixodent stating that “prolonged zinc intake may be linked to adverse health effects.”

Just as an fyi—products linked to the denture cream poisoning also include PoliGrip, and Super PoliGrip.

Top Settlements

Bet Pfizer had some hot flashes this week. The maker of the hormone replacement therapy (HRT) Prempro, agreed to pay $330 million this week, to resolve claims that the menopause drug caused breast cancer. The settlement brings to an end eight years of litigation including some 2,200 related Prempro lawsuits that alleged Wyeth, the company that developed Prempro and was subsequently bought out by Pfizer, knew of the cancer risk but was not forthcoming about it.

According to Bloomberg, over 6 million women used Prempro and other related menopause medications to treat symptoms such as mood swings and hot flashes. Then, in 2002, results from a large cohort study, The Women’s Health Initiative, showed a link to cancer.

Pfizer reportedly faced over 10,000 lawsuits alleging that Prempro caused breast cancer in its users. The company has settled many of them in the past five months, Bloomberg reports. Those settlements include “8,000 cases consolidated in federal court in Arkansas and other cases in state courts in Pennsylvania, Nevada and Minnesota.”

BofA over its limit on overdraft fees. A federal lawsuit alleging that America’s largest bank charged excessive overdraft fees looks likely to be settled. BofA reportedly states in a recent court filing that it has reached a memorandum of understanding to settle the claims in the suit by paying $410 million. Isn’t that really just giving the money back to the people it was gouged from in the first place? That is, if the settlement is approved in court.

The suit is one of several filed against several banks from plaintiffs in 14 states, which were consolidated in a federal court in Florida. Other banks named in related suits include Wells Fargo and Citibank.

Be interesting to see how this plays out.

In the meantime—I’ll see you at the bar—coz that’s it for this week.

Week Adjourned: 12.10.10

Top Lawsuits

Hilton’s in the news this week. This time it’s not Paris who’s behaving badly, but rather the hotel chain that is her family namesake. A former employee of Hilton Worldwide Inc, is suing the company over allegations of unlawful employment practices. No. Really?

Yes. Specifically, the Hilton lawsuit contains facts related to nonpayment of wages, harassment, and sexual favoritism.

In a nutshell, Brian Marcus was employed by Hilton as the Director of Food & Beverages at the Hilton San Diego Bayfront Hotel (“Bayfront”) in San Diego and during his employment, Marcus alleges that he was subjected to harassment and then terminated so that Hilton could avoid having to pay him a bonus that he had already earned. Both of these actions are in violation of California law.

Mr. Marcus alleges that “just over a month before the end of 2009, Hilton terminated Mr. Marcus’s employment and refused to pay him any portion of his bonus for 2009 which he had earned under Hilton’s bonus program. The Complaint alleges that Mr. Marcus’s termination was part of a plan by his supervisor to eliminate him from the hotel so that the supervisor could continue to take additional control without intervention. Hilton created the system by which this supervisor was able to manipulate others for her financial gain and the financial detriment of people like Mr. Marcus.”

In addition, “Hilton subjected Mr. Marcus to a hostile, abusive and intimidating work environment in which sexually inappropriate behavior permeated the workplace. Mr. Marcus is seeking lost pay and benefits and damages associated with mental suffering.”

Bad behavior, it seems, is the Hilton Modus Operandi…

Top Settlements

Just in time for Christmas—five years on. A jury in El Paso has awarded a $132 million settlement to the victims of a bus crash that killed two people and critically injured several Continue reading “Week Adjourned: 12.10.10”