Week Adjourned - Part 34

Week Adjourned: 9.30.11

This week’s wrap on Class Action lawsuits and Settlements, September 30, 2011

Top Class Actions

NCAA Concussion Lawsuit Filed. Again. It’s about time! Two former college football players who suffer from the residual effects of head injuries filed an class-action lawsuit against the National Collegiate Athletic Association (NCAA), accusing the governing body of neglecting to protect student-athletes from concussions and their aftermath.

The class action lawsuit accuses the NCAA of turning a blind eye to coaches who teach players to use their heads for tackling, failing to establish a NCAA-wide system for screening head injuries and shirking its financial obligations to injured student-athletes who need medical treatment after they’ve left college.

The case alleges that despite a mounting body of scientific evidence linking concussions to depression, dementia and early-onset Alzheimer’s, among a host of other medical problems, the NCAA has failed to enforce the safety measures it introduced in the 1970s. The lawsuit further claims that NCAA football coaches continue to encourage players to use tackling methods that promote head trauma, including helmet-to-helmet hits. The harshest penalty ever imposed on coaches who teach this tactic was a letter of reprimand, according to the complaint.

The lead plaintiffs in the suit are former University of Central Arkansas wide receiver Derek K. Owens and former Northwestern University offensive lineman Alex Rucks, who say their lives have been fundamentally altered as the result of brain trauma that could have been prevented.

Owens, 22, was hit in the head from behind while taking part in a voluntary practice the summer before his freshman season. According to the complaint, Owens never received medical attention from the team despite feeling dizzy, having difficulty seeing and being unable to drive home. The 2008 incident was the first of numerous head injuries for Owens, who was named Arkansas’ Top Offensive Player and one of the state’s top Scholar-Athletes his senior year of high school.

The second week of his first season, a linebacker knocked Owens unconscious in practice, according to the lawsuit. UCA’s trainers told Owens’ roommates he had a “severe concussion” and to wake him up every couple of hours. He sat out for several weeks until he was cleared to return to the practice team. During a 2010 game, Owens was returning a punt when he was leveled by an opposing player, who later called the play “the highlight of his career,” according to a story in the Tulsa World. Owens experienced memory loss, headaches, an inability to concentrate, anxiety and depression. His grades plummeted despite his once-sterling academic record. In May of 2011, he dropped out of school and football as a result of the debilitating effects of repeated head trauma.

Rucks, who played at Northwestern from 2004 to 2008, was never formally diagnosed with a brain injury, but suffered numerous blows to his head that led to symptoms consistent with a concussion. The NCAA never tested or followed-up with Rucks to determine whether he’d been concussed, or if he was experiencing post-concussion syndrome, the lawsuit alleges.

Since his playing days, Owens has suffered from the symptoms of post-concussion syndrome, including the loss of concentration and memory, according to the complaint.

The lawsuit alleges the NCAA never encouraged football players to report or complain about their physical well-being, nor does it educate players about head-injury prevention or the telltale symptoms of a concussion.

The lawsuit, a class action, seeks to represent current or former NCAA football players who have medical or team records indicating they sustained a concussion(s) or suffered concussion-like symptoms while playing football at an NCAA school, and who have, since ending their NCAA careers, developed chronic headaches, dizziness, dementia, Alzheimer’s disease or other physical and mental problems as a result of the concussion and have incurred medical expenses from such injuries.

All class members would be notified that they may require frequent medical monitoring. NCAA-wide return-to-play guidelines would be established. The NCAA would mandate that team physicians learn to detect concussions and sub-concussions, as well as determining when a player is at an increased risk of harm. It also seeks to redress the intangible losses suffered by these class members.

Top Settlements

Asbestos Mesothelioma Lawsuit Settlement. Another asbestos settlement to report this week. A jury in Orleans Parish Civil District Court has ruled that three companies are liable for $7.55 million in damages for exposing former employee Thomas Kenney to asbestos. Kenny has been diagnosed with malignant asbestos mesothelioma.

Mr. Kenney sued Rexam Beverage Can Co., John Crane Inc and Haveg Inc, among others, claiming that he was exposed to asbestos while working in a canning factory and a refinery in the 60s and 70s. The jury hearing his case found John Crane, Rexam and Haveg liable for Kenny’s asbestos exposure and Rexam liable for the dangerous levels of asbestos, which was located in its canning factory in New Orleans’ Mid-City neighborhood. The old canning factory has since been refurbished and converted into an apartment complex.

Reebok to Atone for its Toning Shoes Claims: While the jury may be out on whether or not these shoes actually do tone your butt and abs, the Federal Trade Commission isn’t wasting time making up its mind. Reebok has agreed to pay $25M to settle charges brought by the Federal Trade Commission alleging that the athletic shoe manufacturer falsely advertised its “toning” shoes, making claims that the shoes could measurably strengthen the muscles in the legs, thighs and buttocks.

Among the claims the FTC found offensive–and possibly downright misleading—are that the EasyTone footwear is proven to increase the strength and tone of your gluteus maximus muscles by 28% (really?) and give you 11% more strength in your hamstring and calf muscles—(really)—compared with regular walking shoes—whatever those are.

The FTC settlement is the first, and results from its investigation into the advertising claims made by Reebok. However, other companies such as New Balance and Sketchers have also aced lawsuits over their advertising claims.

Ok—That’s it for this week. See you at the bar!

Week Adjourned: 9.23.11

Weekly roundup of latest class action lawsuits and settlements, September 23, 2011

Top Class Actions

Engine Trouble for Mercedes-Benz? Well, last week we reported on a proposed settlement between Mercedes Benz and some unhappy customers who allege consumer fraud over Mercedes Benz USA failing to inform buyers of its luxury vehicles with analog Tele Aid communication systems that the company planned to phase out the analogue emergency communications systems altogether on its models from 2003-2006.

This week, Mercedes Benz is back on the books with a defective product class action. The allegations? Premature wear taking place with its M156 engines, specifically the cam shafts. The suit alleges that the premature wear in the M156 V8 (63 AMG) engine leads to engine problems and in some instances engine failure.

The lawsuit states that the camshafts used are made of cast nodular iron but the valve lifters used are made of 9310 grade steel, and that the combination of these metals as designed is contributing to premature wear of the M156 motors. The suit alleges that Mercedes and AMG (Aufrecht Melcher Grossaspach), a division of Mercedes that sells the high-end M156 have known about this issue since 2007. According to the lawsuit, the luxury vehicles sell for between $60K and $200K. OK, for that kind of money I would not be expecting engine problems – ever.

Top Settlements

Libby Montana Asbestos Settlement. This is a biggy and a long time in coming…long-suffering, potentially terminally ill residents of Libby, Montana, suffering from asbestos-related illnesses including asbestosis and mesothelioma have been awarded a $43 million settlement by a judge in that state. The people were made ill as a result of their exposure to asbestos from the infamous W.R. Grace asbestos mine in Libby, Montana. Reports indicate that a large part of the settlement will be paid by Warren Buffett’s Berkshire Hathaway.

The settlement resolves a lawsuit filed against the state and the mine by former miners and their families who accused the state of failing to properly oversee the mine or warn workers of dangers there. Miners had originally sued W.R. Grace but after the company filed for Chapter 11 bankruptcy in 2001, they sued the state for failing to adequately protect them, court documents state.

Some 1,400 people are expected to receive payouts from the settlement, which was approved September 8, by Montana District Court Judge Jeffrey M. Sherlock, ending ten years of legal wrangling. However, while the settlement ends numerous cases and claims against Montana it “expressly reserves their claims against all other responsible parties,” according to the agreement.

Many of the people who suffered asbestos exposure from the Libby mine are now over the age of 65, and others have since died of asbestos-related diseases such as asbestosis and cancers such as mesothelioma, records show. It may be a good ending but it’s certainly not a good story.

Snap, Crackle…Pop! Goes the Immunity Claim… Ok—hands up—how many of you actually believe a breakfast cereal could boost your immune system? Really.

But no matter, as long as the claim is made…

Kellogg, finding itself in a position of having to defend such a claim, to a potential class of consumers who filed a consumer fraud lawsuit, has proposed a settlement… cheaper than going to court after all.

In a nutshell, the lawsuit claims the Kellogg Company falsely advertised that Rice Krispies cereal and Cocoa Krispies cereal supported a person’s immunity system despite not having competent clinical evidence to support the claim. Now there’s a surprise.

So—if you purchased Kellogg’s Rice Krispies Cereal or Cocoa Krispies Cereal between June 1, 2009 and March 1, 2010, you may be entitled to a cash refund from a class action settlement.

The only way to get a cash refund: Claim Forms must either be submitted online or postmarked by November 16, 2011. If you wish, you can get out of the lawsuits and the settlement. Get no cash refund. If you wanted to exclude yourself, you must have sent an request postmarked no later than July 30, 2011. The deadline to file an objection to the settlement was July 25, 2011. If you do nothing, you will get no cash refund. However, any leftover money will be donated to one or more charities.

OK. That’s it for this week. See you at the Bar. (I’ve been told a Bloody Mary is also good for the immune system…)

Week Adjourned: 9.16.11

Weekly wrap up for September 16, 2011 of the latest class action lawsuits and settlements

Top Class Actions

Destination Maternity could find itself rerouted—make that destination courthouse as they got hit with an employment class action lawsuit this week. Why, you ask? Sadly, nothing very original. The lawsuit claims that the international retail clothing store violated both federal labor laws and New York labor laws by routinely requiring its sales associates to undergo off-the-clock bag checks and security screenings for which they were not compensated.

The lawsuit also claims that Destination Maternity, A Pea in the Pod, Motherhood Maternity (what other kind is there?), and Edamame stores all require their sales associates to have their bags checked before they leave the stores to have lunch and before they go home for the evening. These checks occur off-the-clock, adding as much as 30 minutes to sales associates’ workdays for which they receive neither overtime nor straight time pay. Of course the point of the lawsuit is to recover the wages and overtime pay each sales associate is due under the law.

So, if you work or have worked as a sales associate at either a Destination Maternity, A Pea in the Pod, Motherhood Maternity, or Edamame store, you may request to be included in the proposed class. Check it out.

Top Settlements

The Best or Nothing? Guess it’s nothing… Mercedes Benz will be shelling over some cash shortly, following federal approval of a $15 million settlement of a recent consumer fraud class action lawsuit. It seems that Mercedes Benz USA failed to inform buyers of its luxury vehicles with analog Tele Aid communication systems that they planned to phase out the analogue emergency communications systems altogether on its models from 2003-2006. Yes—that could influence your decision to buy, no doubt.

Back to the good news. Well, sort of. Under the terms of the Mercedes-Benz settlement purchasers of 2003 to 2006 Mercedes-Benz models with the analog Tele Aid systems installed in their vehicles could receive either a certificate for up to $1,300 off a new vehicle or $650 in cash. Ummm.

You’re Forgiven! I love this one! Thousands of people have been forgiven their debts in a historical unfair business class action settlement reached last Friday in Maryland. The class action lawsuit was brought by Jason Hauk and Freddy Velazquez who led the class action lawsuit, against LVNV Funding LLC, a Greenville, SC-based company that buys consumer debt.

According to the terms of the settlement some 3,500 people in the class will receive about $2000 each, for a total of $7 million. The total settlement forgives about $10 million in debt, according to filings in U.S. District Court in Baltimore.

Further, LVNV will not pursue the 3,500 debtors in order to collect the debt, nor will they be able to sell those debts to other third party collection agencies. And LVNV have to remove information it gave to the major credit bureaus for each of those debtors, a step taken to improve their credit ratings. The settlement is being hailed as historic, and a major win for the class. You gotta love the system when it works!

OK. That’s it for this week. See you at the Bar—and safe travels getting home.

Week Adjourned: 8.19.11

Top Class Actions

Vita Coco a bit Loco with their Health Claims? A consumer fraud class action lawsuit was filed this week, against All Market Inc., the manufacturer of Vita Coco Coconut Water, over allegations that you ain’t getting what you pay for.

The plaintiff in the lawsuit alleges that Vita Coco products are falsely marketed as “super-hydrating,” “nutrient-packed,” “mega-electrolyte,” “life-enhancing,” and healthy “super-water” that should be regularly consumed to help maintain optimal hydration. In reality, Vita Coco products are no more hydrating than a standard sports drink and, for some Vita Coco products, do not even contain the levels of electrolytes indicated on their nutritional labels.

According to a recent independent study, certain Vita Coco products have nearly 50% less sodium and significantly less magnesium than advertised.

Lawyers representing the plaintiffs state that consumers are paying a premium for a product that simply does not live up to its health claims, and that Vita Coco products do not deliver on their nutritional promises. Well, if the products lived up to the advertising they should be putting that stuff in the tap water!

The lawsuit was filed on behalf of purchasers of Vita Coco products between August 10, 2007 and the present.

Top Settlements

Asbestos Mesothelioma Lawsuits Continue to Rise. These two asbestos settlements total $51 million. Separate verdicts totaling $32 million and more than $19 million were awarded on August 17 in cases involving individuals who contracted asbestos mesothelioma after being exposed to asbestos.

In the case of Ronald Dummitt and Doris Kay Dummitt v. A.W. Chesterton, et al., a jury found Crane Co. and Elliott Turbomachinery Co., responsible for the asbestos exposure that led to a U.S. Navy boiler tender’s diagnosis of pleural mesothelioma, an incurable form of cancer.

In returning its verdict, the jury determined that Crane and Elliott acted with a reckless disregard for the safety of others in failing to warn. The jury apportioned 99 percent responsibility to Crane and 1 percent responsibility to Elliott. The award included $16 million in past pain and suffering and $16 million in future pain and suffering to Mr. Dummitt.

In the case of David Konstantin and Ruby Konstantin v. 630 Third Avenue Associates, et al., the jury found Tishman Liquidating Corporation, formerly known as Tishman Realty & Construction, Co., Inc., responsible for Mr. Konstantin developing mesothelioma of the tunica vaginalis, one of the rarest forms of cancer in the world. Like all cases of mesothelioma, this form of the disease is not curable.

The jury found Tishman 76 percent liable and to have acted with reckless disregard for the safety of others. The jury awarded Mr. Konstantin $7 million for past pain and suffering, and $12 million for future pain and suffering. The verdict amount also included $64,832 for past lost wages, and $485,325 for future lost wages.

If ever there were an Argument for Being your own Health Advocate… this would probably be it. A man admitted to Temple University Hospital for three severe hypoglycemic episodes over two days, episodes that left him with permanent brain damage—by the way—has been awarded $19 million in settlement of his medical malpractice lawsuit.

The short version of his terrifying story is that after having been released from hospital without a diagnosis or explanation as to why he was suffering from hypoglycemia, Ronald S. Campbell was admitted and subsequently discharged again—and for the last time—at 1:04 am. The middle of the night—or the wee hours of the morning. Whichever you prefer to call it, Campbell’s lawyers argued, rightly, that it was a time when his family would probably be asleep (you think?) and that hospital staff knew that and that Campbell’s family would therefore not able to monitor his condition.

In their defense, the hospital said it met the standard of care in restoring Campbell’s blood sugar to a stable level and noted that he had been previously noncompliant with insulin instructions. Yes—but since when do you discharge people in the middle of the night—and without figuring out what was going on? This whole situation may have been preventable… but instead he has brain damage.

OK. That’s it for this week. See you at the Bar—pool bar most likely.

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: 8.6.11

Top Class Actions

Let’s hope that WebMD has a cure for what ails it… which would be a securities class action. The online health information company was served this week, reportedly, over allegations that certain of its officers and directors violated the Securities Exchange Act of 1934. (Given the number of securities suits that cite this particular infraction, I’m going to assume that the SEA is not a popular read).

FYI—in case your computer’s been down for the past 10 years—WebMD provides health information services to consumers, physicians and other healthcare professionals, employers, and health plans through its public and private online portals, mobile applications, and health-focused publications in the United States.

The lawsuit was filed on behalf of purchasers of the common stock of WebMD Health Corp. (“WebMD” or the “Company”) between February 23, 2011 and July 15, 2011, inclusive (the “Class Period”).

The complaint alleges that, during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and prospects. Specifically, defendants misrepresented and/or failed to disclose the following adverse facts: (i) that WebMD was experiencing sponsorship cancellations due to extended legal and regulatory reviews; (ii) that WebMD’s customers, including several consumer product companies, were delaying advertising on the Company’s website as a result of smaller advertising budgets; and (iii) as a result of the foregoing, defendants lacked a reasonable basis for their positive statements about the Company and its prospects.

On July 18, 2011, WebMD announced its preliminary second quarter financial results and lowered its financial guidance for 2011. In reaction to the Company’s announcement, the price of WebMD stock fell $14.01 per share, or 30%, to close at $32.48 per share, on extremely heavy trading volume.

Top Settlements

All you new parents out there—heads-up—the Department of Health and Human Services recently settled a lawsuit brought by the parents of a toddler who allegedly sustained injuries as a result of receiving immunizations. Details as to which immunizations were administered were not released, unfortunately.

The settlement for $8,713,625, agreed by the parents, included future lost earnings, past and future pain and suffering, past and future medical expenses, attendant care, rehabilitation, and residential expenses for their child.

The parents alleged the child began suffering febrile seizures within 24 hours of having the immunizations.

Apparently, results of testing revealed that the child had suffered a stroke, lack of muscle coordination, loss of hearing and loss of sight. The parents also alleged that the child suffered significant delays, including speech, intellect and fine motor skills development. At the age of nine, the child required a G-tube for nutrition and was not potty trained. It is worth noting that this is not a common situation, but that is precisely what makes it all the more heart-wrenching.

Wachovia Pick-A-Pay proposed setlement anything but picayune… Here’s one for the records—as in size of potential settlement—if it’s approved that is. A Wachovia securities class action, led by The Orange County Employees’ Retirement System, the Louisiana Sheriffs’ Pension and Relief Fund, and the Southeastern Pennsylvania Transportation Authority, the court-appointed representatives of a class of investors who purchased certain Wachovia Corporation (Wachovia) bonds and preferred securities pursuant or traceable to numerous public offerings between July 31, 2006 and May 29, 2008, may have reached a settlement—in the amount of $627 million. Shut the front door!

According to the press release, the combined $627 million recovery is among the 15 largest securities class action recoveries in history. It also is believed to be the largest settlement ever in a class action case asserting only claims under the Securities Act of 1933. The case also represents one of the handful of largest securities class action recoveries ever obtained where there were no parallel civil or criminal securities fraud actions brought by government authorities.

The lawsuit was based on allegations that the Wachovia offering materials at issue misrepresented and/or omitted to disclose material facts concerning the nature and quality of Wachovia’s multi-billion dollar option-ARM (adjustable rate mortgage) “Pick-A-Pay” mortgage loan portfolio, and that Wachovia’s publicly disclosed loan loss reserves were materially inadequate at all relevant times, in violation of Generally Accepted Accounting Principles (“GAAP”). So—it all comes back to mortgages…

The lawsuit alleges that the undisclosed problems in the “Pick-A-Pay” mortgage loan portfolio brought Wachovia to the brink of insolvency by September 2008. Cast your mind back—Wachovia was one of the largest financial institutions to be “bailed out” during the financial crisis, when Wells Fargo & Company agreed to acquire it in early October 2008.

Both settlements must be reviewed and approved after formal notice is provided to the class.

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

Week Adjourned: 7.30.11

Top Class Actions

Guaranteed Rate but Not Guaranteed Pay? That’s the story according to loan officers who worked for Guaranteed Rate Inc (GRI) and filed a wages and overtime class action lawsuit against the mortgage lender this week.

The lawsuit alleges that GRI violated the rights of loan officers under the California Labor Code. That’s not very nice. The lawsuit alleges that the mortgage lender unlawfully paid loan officers below minimum wage, failed to compensate them for overtime hours worked and unjustly deducted expenses from previously earned wages, in violation of state wage and hour laws.

The complaint also claims that Guaranteed Rate incorrectly and intentionally classified loan officers as “outside salespeople,” making them exempt from some minimum wage and overtime regulations. Oh, that old chestnut. Never dies, does it.

Predictably, these outside sales employees claim to have spent more than 50 percent of their working time in their homes, which the employees argue is considered the employer’s places of business for purposes of the outside sales exemption from minimum and overtime wage laws.

The Guaranteed Rate Loan Officer class action lawsuit further alleges that the mortgage lender intentionally misclassified the loan officers as outside salespeople in order to avoid overtime and minimum wage requirements in violation of California employment laws. Specifically, the complaint states, the sales plaintiff was paid a “percentage of the profit obtained from the sale of the loan” and as a result “there were pay periods during which the Plaintiff received less than minimum wage or no compensation.” This compensation structure caused the loan officers to often work more than 8 hours per day and/or 5 days per week, which was allegedly known by the the Mortgage Loan Company.

According to California overtime laws, employers are required to pay employees overtime compensation for all hours worked in excess of eight hours in a single workday or forty hours in a workweek.

Top Settlements

Another Big Asbestos Settlement. A painter who was recently diagnosed with terminal asbestos mesothelioma caused by his exposure to asbestos-laiden products, was awarded $8.5 million in settlement of his asbestos lawsuit.

Bernard Steffen alleged that while working as a commercial painter and handyman he was exposed to products including stucco, molding and construction materials that contain asbestos. In his lawsuit he named as defendants the many manufacturers of the products, claiming that they knew of the dangers associated with their products yet failed to provide appropriate warnings.

The named defendants who went to court were cement maker CalPortland Co., molding material maker Cytec Engineered Materials and product supplier Union Carbide,all of whom denied the allegations. The jury found CalPortland and Union Carbide each 10 percent liable; remaining liability was divided amongst defendants who were no longer in the case at trial. Cytec was found not liable.

The storm around Katrina—will it ever end? Maybe. Preliminary approval of a $25 million settlement of a class action lawsuit against Tenet Healthcare Corp and subsidiaries has been granted by Orleans Parish Chief Judge Rosemary Ledet.

The lawsuit was filed following and as a result of Hurricane Katrina in which Tenet’s Memorial Medical Center in New Orleans was flooded, and dozens of people, patients and visitors, suffered as a result. A class of plaintiffs represents patients and family of patients who died in the hospital during the storm: 45 patients died during in the hospital during the storm, and doctors later admitted to having used euthanasia on patients, but no criminal charges were brought.

According to a report in the Louisana Record, the lawsuit states that approximately 187 patients and 800 visitors were in the hospital during and after the storm.

The lawsuit alleges that Tenet was liable for failing to adequately prepare the hospital for flooding before Katrina despite warnings from the hospital’s maintenance staff. The back-up power source in the hospital failed during the hurricane, as a result of flooding caused when the federally built levees broke, letting floodwater into the city. According to court documents, Tenet had argued that the dangerous environment at the hospital was a result of the failed levees and shoddy government response to the storm.

Tenet staff spent several days urgently seeking help from several federal agencies including the Federal Emergency Management Agency and the Coast Guard. The Tenet settlement releases Tenet and its partners from all liability.

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

Week Adjourned: 7.23.11

Top Class Actions

Unlikely Couple Teams up vs DuPont Imprelis. A Pennsylvania homeowner and an Indiana golf course company filed a nationwide class action lawsuit this week, against E.I. du Pont de Nemours & Company (“DuPont”). The charges? You may have read about them—that the use of a weed killer called Imprelis, made by DuPont, is causing widespread death among trees and other non-targeted vegetation across the country. Non-targeted vegetation? What is that—environmental collateral damage?

No wait—non-targeted vegetation means anything that’s not a weed. According to the lawsuit, DuPont failed to adequately disclose the risks for Imprelis damage to trees, even when applied as directed (oh great), and failed to provide adequate instructions for its safe application. Even better.

Lead plaintiff Marsha Shomo, a resident of Johnston, Pennsylvania, claims that the trees at her house of are dying after her lawn was sprayed with Imprelis. Included are two trees Shomo’s sister bought after her diagnosis with cancer, which took her sister’s life in 2001. “My sister was so anxious that the new little trees she bought be taken care of,” Shomo stated. “I promised her I would do that. I want DuPont to know that there is a problem out there and people do have special trees with many years invested in them. This isn’t right. I am filing this lawsuit to make sure DuPont answers to everyone harmed, and make DuPont act more responsibly in the future.”

As for the golf course, Plaintiff R.N. Thompson Golf, LLC, in fact owns and manages several golf courses in the greater Indianapolis area, including the Winding Ridge Golf Course and the Ironwood Gold Course. “We have witnessed catastrophic tree loss around our golf courses after the application of Imprelis, and have received numerous complaints and inquiries about the tree damage and appearance of our courses from our customers,” explained Mark Thompson, Chief Executive Officer of R.N. Thompson Golf, LLC. “We filed this lawsuit to inform other businesses and homeowners about this problem to let them know there is reason their trees are dying and to give them a course of action to fix the problem.”

If Imprelis is affecting your environment, check this Imprelis lawsuit out.

The proposed class consists of all persons and entities whose property was exposed to Imprelis between October 4, 2010 and the date of trial, in particular, those who own: (a) property on which Imprelis was applied; (b) trees or other vegetation whose roots extend under property on which Imprelis was applied or; (c) property onto which Imprelis migrated. Anyone with damaged trees is being advised to preserve the evidence.

Top Settlements

Drilling Deal. Amidst all the media coverage of a rather dubious practice of extracting natural gas called fracking —and the allegedly related water and health issues surrounding it, property owners on the Marcellus Shale belt in Pennsylvania have just won $14 million from a drilling company that reneged on their contracts to drill. Most people are trying to stop the drilling, but these property owners want it.

The out-of-court settlement was signed off by a Westmoreland judge, ending the two year civil suit brought by 230 property owners against State College-based Rex Energy. The fracking lawsuit was filed in 2009 by property owners in the rural areas of Cook, Derry, Fairfield, Ligonier, Mt. Pleasant and Unity townships. The lawsuit alleged that Rex Energy reneged on 137 drilling contracts the owners claimed they had finalized in 2008. The property owners also claimed that the company failed to honor promises of bonus and rental payments on the drilling leases.

According to a report on Triblive.com, the disputes involves oil and gas drilling rights on about 7,200 acres, or almost 11 square miles. The settlement permits landowners who had not signed leases with other companies and still wished to sign with Rex to do so at $2,500 per acre. The new, five-year leases give landowners a 15 percent royalty on any gas produced. Better get Fracking!

Finally…Score One for the Little Guy. Bank of Hawaii reached a tentative settlement with account holders this week concerning an overdraft fees class action lawsuit brought pissed-off customers who alleged the bank engaged in a systematic policy of re-ordering debit card transactions from highest dollar amount to lowest dollar amount. You could almost recite that sentence in your sleep it’s so common, unfortunately. The lawsuit claimed that this alleged practice allowed the bank to deplete the customer’s available funds as quickly as possible while maximizing the number of overdraft fees.

The Bank of Hawaii settlement amount is $9 million, and, if approved will be used to refund class members for overdraft fees they were charged. “The tentative settlement, subject to documentation and court approvals, provides for a payment by the company of $9 million into a class settlement fund the proceeds of which will be used to refund class members, and to pay attorneys’ fees, administrative and other costs, in exchange for a complete release of all claims asserted against the company,” the bank said in a filing with the Securities Exchange Commission.

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

Week Adjourned: 7.16.11

Top Class Actions

From small print to misprint? A consumer fraud class action lawsuit was filed this week against Genesis Financial Solutions, Inc.(GFS), NCO Portfolio Management Inc. and WebBank. What’s the problem?

Allegedly, the Defendants deceptively used an offer for a pre-approved Pearl Card® Gold MasterCard® to collect or receive payment for an alleged debt, when in fact the offer was a collection letter. Oops.

The lawsuit alleges multiple violations of the Fair Debt Collection Practices Act and the Texas Finance Code. According to court documents Plaintiff Mark Myers received a mailed communication on July 12, 2010 with an offer from NCO Financial Services and GFS Financial Solutions that stated in bold print at the top, “Transfer your debt to a Pre-Approved+ MasterCard®!”

The average consumer receives numerous credit card offers in the mail each month and may have perceived this offer, which was an attempt to collect a debt on behalf of the defendants, as a typical credit card application/offer, or junk mail and tossed it in the trash, and in the process, thrown away a communication that triggered specific rights under the Fair Debt Collection Practices Act.

Part and parcel of the FDCPA’s rights afforded to a debtor is what is commonly referred to as the “Mini-Miranda Warning”, a statement that identifies the name of the debt collector, the company they represent, and advises the debtor of his/her right to validate and dispute an alleged debt within 30 days. The Fair Debt Collection Practices Act mandates that each time a debtor is contacted by a debt collector via written communication, the “Mini-Miranda Warning” must be provided.

The complaint alleges that the communication received by Plaintiff Myers and others did not clearly display the “Mini-Miranda Warning” in its entirety where it could easily be viewed and read. This important information advising a debtor of his/her rights, appeared on the reverse side of the offer and thus could easily have been missed or overlooked and was overshadowed by the voluminous amount of fine print that has become standard in most credit card offers. A signature confirming acceptance of this new Pearl Card® Gold MasterCard® offer would validate the amount of the alleged debt and restart the clock on the statute of limitations, which may have already expired, unbeknownst to the debtor. By signing and agreeing to proceed with the credit card offer, the debtor has now waived his rights to validate and/or dispute the alleged debt.

The complaint also alleges that Defendant WebBank allowed GFS and NCO the use of its Utah banking charter for the credit card offer, though WebBank was not actually a party to the collection efforts. The communication itself states “GFS is not affiliated with WebBank…..” The Utah banking charter allows GFS and NCO, through alleged partnership, the opportunity to use Utah’s laws which allow for no caps on interest rates and fees for all 50 states other than what competition dictates, in the MasterCard® offer.

Okee Dokee! Go get’em!

Top Settlements

What part of ‘smoking causes chronic, debilitating illness including cancer’ is unclear? None apparently. RJ Reynolds recently settled a personal injury lawsuit brought by a woman who developed chronic obstructive pulmonary disease (COPD) and Stage II laryngeal cancer.

Julia Reese, a life-long smoker, was diagnosed with COPD and cancer at the age of 82. She required a full laryngectomy as treatment for her cancer.

Her story goes that she began smoking RJ Reynolds Tobacco Co. brand cigarettes when she was 10 years old and became addicted. Although she allegedly tried to quit smoking several times she was unsuccessful (what smoker doesn’t know how that works?), and still smokes despite her health status.

Interestingly, the jury hearing the case found Reese 70 percent liable and RJ Reynolds 30 percent liable. Consequently, the original settlement award was reduced from $3,551,277 to $1,065,383.

Blast those Blast faxes! But wait—good news! A settlement has been proposed in the class action Starkle Ventures, LLC v. United Artists Theatre Circuit, Inc. and American Blast Fax, Inc. Ringing bells? No?

Cast your mind back—way back—to September 1999 when United Artists Theatre Circuit, Inc. (“UA”) and American Blast Fax, Inc. (“ABF”) sent a fax advertising discount movie tickets to phone numbers in Maricopa County, Arizona. A class action lawsuit was subsequently filed against UA and ABF alleging the facsimile advertising violated the Telephone Consumer Protection Act, U.S.C. section 227. Following certification of the class action, a tentative settlement was reached.

Plaintiff has entered into a (the “Settlement”). The settlement creates a fund in excess of $6.8 million to pay class members, costs of suit, attorneys’ fees and class representative incentive awards.

FYI—if you held (as of September 1999) one or more fax numbers on the list used to send the facsimile advertisement, you may be entitled to receive money pursuant to the settlement or, if the settlement is not approved by the Court, through continued litigation in the case. You could potentially receive as much as $500 per facsimile number that you held from the settlement.

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

Week Adjourned: 7.9.11

Top Class Actions

Pricey Prescriptions? This is nothing short of scandalous, if the allegations prove true. A nationwide consumer fraud class action lawsuit was filed against CVS Caremark, the largest pharmacy health care provider in the United States and the owners of CVS.com, for allegedly double-billing its customers for the price of prescription drugs.

The lawsuit claims that CVS’s nationwide billing system double-bills the price of prescription drugs to CVS customers who have a high deductible health plan that is coupled with a health reimbursement account or health savings account (HSA) and who use a prescription drug coupon. CVS’s billing system isn’t equipped to handle this coordination of benefits, and as a result, it’s alleged that CVS uniformly double-bills these customers–taking cash from the customer at the time of sale and then later taking cash from their HSA. Unbelievable!

The class action lawsuit brings the claim on behalf of all CVS customers who were allegedly double-billed the price of prescription drugs and seeks damages on behalf of those customers estimated to be in the hundreds of thousands across the country. Check your receipts and your statements!

Top Settlements

Asbestos Mesothelioma Settlement. Another large asbestos-illness lawsuit was settled this week, with an Orleans Parish Civil District Court jury hearing the lawsuit finding in favor of the plaintiff. The jury awarded Leopold Granier Jr, a $1.5 million settlement in general damages, and $104,160.77 in special damages.

Mr. Granier developed asbestos mesothelioma as a result of his exposure to asbestos, asbestos he was allegedly exposed to through the negligence of Avondale Shipyards, Cajun Insulation and Union Carbide Corp. The jury produced a four page verdict, which found that Avondale, Cajun and Union Carbide were strictly liable and that the products in their possession were a “substantial and contributing cause” of Granier’s mesothelioma.

The jury also found that Union Carbide, in particular, was strictly liable because asbestos materials incorporated into the company’s Taft, La., plant were a “substantial and contributing cause” of the man’s cancer. I guess there’s no surprise there.

Avondale shipyard was, at one time, the largest employer in the state of Louisiana, employing more than 20,000 people. The shipyard was acquired by Northrop Grumman Corp., and is now slated to close in 2013. Northrop Grumman made the decision as a result of a reduced order for warships from the US Navy.

20,000 employees is no small business…I wonder how many more asbestos lawsuits Avondale could find itself on the end of?

Would You Prefer Still, Sparkling or Tap Water? Maybe it’s further proof that tap is just fine, thanks, as this sounds like a nightmare come true—a woman who was mistakenly given a bottle containing a poisonous chemical instead of drinking water subsequently suffered second and third degree burns to her esophagus and permanent damage (no kidding). She sued, and was recently awarded $3.3 million in her product liability lawsuit.

Julia Ellis suffered the life-altering burns in 2007. She was at Harvey’s Lake Tahoe Hotel and Casino in Stateline, NV, when she was given a bottle labeled “Harrah’s Purified Drinking Water.”

As a result of her injuries, Ellis can now eat only pureed or soft foods. She sued Harvey’s and Harrah’s on claims of strict products liability, breach of warranty and premises liability.

OK. That’s it for this week. See you at the Bar. Watch what you’re drinking!