Bank of America

Week Adjourned: 9.26.14 – E-Cigarettes, GNC, BofA

The week’s top class action lawsuits and settlements. Top stories include e-cigarettes, GNC and Bank of America.

Top Class Action Lawsuits

Hmm, has Fumizer been Smokin’ Something? Consumers are fuming over false advertising claims made by a manufacturer of e-cigarettes—so much so they’ve filed a consumer fraud class action lawsuit. Filed by a smoker, not surprising there, the lawsuit accused Fumizer of falsely claiming its vaporizers could help users quit smoking or lead to “healthy smoking” (healthy smoking?—that is an oxymoron—not to mention the visual is totally counter-intuitive).

The e-cigarette lawsuit alleges the company made these claims despite the existence of adverse medical studies. Ya think?

The lawsuit, filed by plaintiff Joseph Sheppard, alleges that the manual for the Fumizer e-cigarette claims it can “help you quit smoking,” which contradicts other marketing materials that disclaim that any use of the e-cigarette is an aid to quit smoking. According to the lawsuit, the disclaimers are made to avoid U.S. Food and Drug Administration (FDA) regulation.

“These representations are contradictory and hypocritical because [the packaging] asserts Fumizer e-cigarettes are ‘neither intended nor marked as a quit smoking aid,’” the complaint states.

Further, the complaint contends that Fumizer misled consumers by referring to healthy smoking, and ignoring studies which show e-cigarettes still contain some of the carcinogens and toxins in tobacco cigarettes, along with additional potentially harmful chemicals.

Sheppard also states in the complaint that vaporizers require users to inhale more deeply compared with traditional cigarettes, which could be harmful. Claims about healthy smoking make consumers feel there are no risks to using the devices, the suit claims.

“There is widespread agreement in the scientific community that further research is necessary before the full negative effects of electronic cigarette use on users’ health can be known and that until then, manufacturers, sellers and distributors of electronic cigarettes should not make any representations relating to the safety, health or benefits, if any, of electronic cigarettes,” the complaint states.

Additionally, the lawsuit notes that Fumizer fails to list the ingredients for its products, thereby preventing consumers from being able to make an informed decision regarding whether or not they want to risk inhaling specific chemicals.

“By omitting the ingredients, defendant hides the fact that Fumizer e-cigarettes contain propylene glycol, a product found to cause throat irritation and induce coughing, and thus no longer used by certain of Fumizer’s competitors,” the lawsuit states.

The lawsuit also states that Fumizer’s claims its devices could be used anywhere, citing cities and counties in California that have banned e-cigarettes and public, along with statements that its vaporizers were top quality. However, the plaintiff’s Fumigo 650 Personal Vaporizer allegedly short-circuited, exploded and caused a fire in his home in March, according to the suit.

E-cigarettes that are good for you? Sounds like a Scamorama ding-dong to me.

Top Settlements

OxyElite been Beat? And while we’re on the subject of too good to be true—GNC Holdings Inc, the maker of USPLabs OxyELITE Pro just agreed to settle a class action that alleged the diet supplement does everything but take the garbage out. Unfortunately, it seems that included associated liver damage, which got the diet supplement pulled from the market by the FDA last November.

The ensuing lawsuit alleged GNC sold the supplements, which contain dimethylamylamine, better known as DMAA, and aegeline, despite widespread reports that the products cause severe liver damage.

This week, GNC agreed to pony up $2 million to shut the suit down. The GNC settlement motion, filed in the Northern District of Florida, asked the court to sign off on the deal, which will provide reimbursements for consumers who bought USPlabs’ OxyElite Pro and Jack3d lines of products.

Heads up—the settlement class includes anyone who bought the USPlabs products between Aug. 17, 2012, and the date of final approval, according to the motion. Eligible class members will receive $35 per container of OxyELITE Pro purchased, $20 per container of Jack3d and $20 per container of VERSA-1.

The case is Velasquez et al. v. USPLabs LLC et al., case number 4:13-cv-00627, in the U.S. District Court for the Northern District of Florida.

Force-placed Insurance Scams made the news this week, with final approval granted for a $31 million settlement of seven proposed force-placed insurance class actions, all alleging Bank of America NA (BofA) illegally forced homeowners to buy excessive amounts of flood insurance. It’s a lottery where the bank always wins, it seems. But not in these cases.

Approved by a federal judge in Oregon, the settlement will see BofA pay $31 million into a settlement fund, with plaintiffs receiving $2,500 each as an incentive award. The approval order also calls for certification of a class for settlement purposes only.

The lawsuits were filed in 2011 alleging BofA sent letters to homeowners and other borrowers informing them that they carried insufficient flood insurance because they lived in special flood zones, where there was a high risk of flooding and associated hazards. However, there is no federal requirement for homeowners living in those areas to carry additional insurance, the lawsuits claimed. BofA allegedly ignored proof sent by the plaintiffs demonstrating that they med the allegedly unnecessary requirement.

Under the terms of the settlement, BofA will make a series of changes to its insurance practices, including not taking any commission from force-placed flood insurance for three years. The bank also agreed to cease giving out opt-out letters from the forced policies in some of its future mailings and to refund co-op borrowers for any force-placed insurance that was not required by their loans.

The case is Larry Arnett et al. v. Bank of America NA. et al., case number 3:11-cv-01372, in the U.S. District Court for the District of Oregon.

Ok – Folks –time to adjourn for the week. Have a fab weekend –see you at the bar!

Week Adjourned: 9.5.14 – Allstate, Radiology Bills, BofA Phone Calls

The week’s top class action lawsuits and settlements. Top stories include Allstate Insurance, Radiology Bills and BofA Phone Calls.

Top Class Action Lawsuits

You’re in good hands with Allstate? Maybe not so much if you’re a claims adjuster. This week the Insurance giant got a surprise. It’s green lights a go-go for a long-standing unpaid overtime class action against, involving 800 Allstate employees in California who allege Allstate had a practice or unofficial policy of requiring its claim adjusters to work unpaid off the-the-clock overtime in violation of California labor law.

The Allstate lawsuit was brought by casualty adjuster Jack Jimenez in 2010, on behalf of any claims adjuster working for the insurer in the state of California since September 29, 2006. The complaint alleges that Allstate’s managers are required to stay within an annual budget that includes overtime compensation, and that the performance evaluations and bonuses paid to managers are dependent on how closely they conform to the budget. This would mean that a manager would have a disincentive to approve and report overtime, the class claims.

The class action alleges that Allstate sees repeated requests for overtime as a performance issue to be addressed with individual workers “including “suggestions” on how a claims adjuster can be better trained on efficiency and alternative methods of getting the work done that do not require overtime. Managers would often see workers performing off-the-clock work outside of their scheduled shifts but not inquire if overtime was requested, the workers say.

The plaintiffs contend Allstate’s allegedly illegal conduct has been widespread and consistent. The class action suit alleges that Allstate had not paid overtime to current and former California-based claims adjusters in violation of California Labor Code and had not paid adjusters for missed meal breaks and that Allstate had not timely paid wages upon termination in violation of the California Labor Code. In addition, the lawsuit alleges that Allstate engaged in unfair competition in violation of California Business and Professions Code.

FYI—the case is: Jack Jimenez v. Allstate Insurance Company – CV 10-8486 AHM (FFMx).

How much for that X-Ray? Two Florida women recently filed a class action lawsuit alleges JFK Medical Center and parent company HCA, Inc., are in violation of Florida’s Deceptive and Unfair Practices Act. Specifically the plaintiffs allege they and others like them were billed exorbitant and unreasonable fees for emergency radiological services covered in part by their Florida Personal Injury Protection (PIP) insurance.

Under Florida’s No Fault Car Insurance Law, drivers are required to have $10,000 in PIP insurance, which has a 20 percent out-of-pocket deductible. The complaint, filed in the Thirteenth Judicial Circuit Hillsborough County, charges JFK Medical Center, of Atlantis, Fla., and other Florida HCA facilities with billing PIP patients’ rates for radiological services that are 20 to 65 times higher than the rates charged for similar services to non-PIP patients.

The lawsuit was brought by Marisela Herrera and Luz Sanchez, both of whom were PIP-covered patients who were treated through JFK Medical Center’s emergency department after their automobile accidents in April 2013 and May 2013, respectively. Herrera and Sanchez each received a CT of the brain for $6,404, a CT scan of the spine for $5,900, and a thoracic spine X-ray for $2,222. Herrera also received a lumbar spine X-ray for $3,359.

According to the South Florida Medicare rate, a standard used for customary and reasonable medical service rates, the brain CT scan provided is $163.96; the cervical spine CT scan, $213.14; and the thoracic spine x-ray, with three views, $38.

The complaint charges that because of the exorbitant rates, both Herrera’s and Sanchez’s $10,000 PIP coverage were prematurely exhausted and both were billed thousands of dollars by JFK Medical Center for radiological services not paid for by their PIP insurers.

The complaint also charges breach of contract since both women entered into a “Condition of Admission” contract that provides that patients must pay their accounts at the rates stated in the hospital’s price list. Neither woman was provided a price list at the time of medical treatment.

Plaintiffs are represented by Cohen Milstein Sellers & Toll PLLC, Boldt Law Firm, of Hollywood, FL, and Gonzalez & Cartwright, P.A., of Lake Worth, FL.

Top Settlements

Ah—one ringy dingy—that will be $32 million thank you! That’s right folks—a $32 million settlement has been reached in a Telephone Consumer protection Act (TCPA) class action pending against Bank of America (BofA). The BofA lawsuit claims the bank and FIA Card Services, also a defendant, violated the TCPA when it used automatic telephone dialing systems and/or an artificial or prerecorded voice to contact individuals without obtaining prior express consent from those individuals.

The ruling certifies a class for settlement purposes including all individuals who received allegedly unauthorized automated phone calls from BofA regarding mortgage loan and credit card accounts between 2007 and 2013. The class also includes people who allegedly received unauthorized text messages to their cell phones, between 2009 and 2010. The class is thought to total roughly 7 million members.

The preliminary settlement, if approved, could be an amount the parties claim to be the largest ever obtained in a finalized TCPA settlement, according to an order filed Friday approving the deal.

In addition to the monetary portion of the settlement, Bank of America has improved its servicing systems such that they prevent the calling of a cellphone unless a loan servicing record is systematically coded to reflect the customer’s prior express consent to receive calls via their cell phone.

Ok Folks–time to adjourn for the week. Have a fab weekend—see you at the bar!

Week Adjourned: 12.20.13 – Snooki Diet, Major Bank Credit Card Fees x 2

The week’s top class action lawsuits and settlements. Top class actions for the week include Snooki’s would-be diet wonder and major bank credit card fees.

Top Class Action Lawsuits

Is Snooki snookered? And maybe those of us using Zantrex? Christmas is not a good time to get the news that your diet pills may be snake oil. But, really, it shouldn’t come as a surprise. Snooki, of “Jersey Shore” fame, is facing a federal consumer fraud class action lawsuit over allegations she promoted the diet pill Zantrex knowing that the pills don’t work. http://www.bigclassaction.com/lawsuit/snooki-zantrex-diet-pills-consumer-fraud-class.php

Basic Research LLC, Zoller Laboratories, three of their officers, and Nicole Polizzi aka Snooki are named as defendants by lead plaintiff Ashley Brady, who claims Zantrex combines caffeine with herbs that are “unsafe and ineffective for weight control or appetite suppression.” Brady further alleges that the three officers have been ordered to cease and desist selling fraudulent weight-loss products.

So re: the Snooki Zantrex lawsuit, here’s the skinny—(couldn’t resist that one) Brady alleges she bought a bottle of Zantrex-3 in 2010 after reading the label’s claims stating the drug would provide “546% More Weight Loss Than America’s #1 Selling Ephedra-Based Diet Pill,” and that it would make her lose weight “without diet and exercise.” (OK, what’s your first clue.)

According to the lawsuit, “Snooki represents … that Zantrex is safe and effective for weight loss and fat loss,” the lawsuit states. “These representations are false, misleading and deceptive because … Zantrex is neither effective nor safe for weight loss nor fat loss.” The complaint states that Snooki is the face of the Zantrex brand, promoting it on her websites, on YouTube, Twitter and Facebook, and in celebrity gossip magazines.

Basic Research bills itself as “one of the largest ‘nutraceutical’ companies in the United States, with annual sales revenues in excess of $50 million,” the lawsuit states. Further, all three officers have come under fire for similar fraudulent schemes in the past. Defendant Dennis W. Gay is a principal and director of both Basic Research and Zoller; the FTC enjoined him in a similar case weight-loss fraud in 2006, according to the lawsuit. Additionally, defendant Daniel B. Mowrey was also enjoined from this conduct by the FTC’s 2006 injunction, and defendant Mitchell K. Friedlander, with Basic Research received a cease-and-desist order from the US Postal Service in 1985, also involving allegedly fraudulent weight-loss products, and a second USPS order involving bogus breast enlargement products, according to the lawsuit.

What’s that expression—“it’s the company you keep.”

Ho Ho Ho Baby!

What is this? Instant Replay? Almost. Following on the heels of a huge settlement by Visa and Mastercard in an antitrust lawsuit brought by thousands of small businesses across the US, (see below), a consumer banking class action lawsuit has just been filed against four major banks alleging they conspired to fix “interchange fees,” attached to the use of those same banks’ credit cards.

Those additional fees have cost consumers billions, according to the allegations. But I’m getting ahead of myself…

Not to sound cynical, but the list of defendants shouldn’t’ come as a surprise. They are JPMorgan Chase & Co., Bank of America Corp., Capital One FSB and HSBC Bank USA NA. The allegations are that they conspired with credit card companies to arrange or ‘fix’ the swipe fees charged to customers when they use their credit cards. The credit care fee lawsuit contends this has cost cardholders (you and me)—are you ready for this—over $54 billion in illegal credit card and bank fees annually. That would fund a few retirement but not ours apparently. No surprise, the class action claims this “price fixing” is in violation of the Sherman Act and the California Business and Professions Code.

Filed by Melvin Salveson, Edward Lawrence, Dianna Lawrence and Wendy M. Adams, the potential class action seeks to represent a nationwide class of Visa and MasterCard holders.

The plaintiffs claim that they each purchased “thousands of dollars’ worth of goods and services and paid related Interchange Fees on Visa and MasterCard transactions at prices inflated by the Defendants’ price-fixing conspiracy over many years.” Further, because of these fees, the plaintiffs contend, they have purchased products at artificially inflated prices. According to the lawsuit, “This price-fixing conspiracy is ongoing and additional overcharge dollars are being extracted from Cardholders pursuant to the conspiracy every time they swipe their Visa and MasterCard payment cards.”

And—yes—there’s more—all this collusion has also resulted in a loss of competition from other cards, in that merchants were prevented, allegedly, from telling their customers that there were cheaper options when making a purchase

Entitled Salveson, et al. v. JPMorgan Chase & Co., et al., Case No. 13-cv-05816, in the U.S. District Court for the Northern District of California, the lawsuit claims “In furtherance of the conspiracy, Defendants and their co-conspirators also agreed to and have collectively imposed restraints on competition, such as so-called ‘Exclusionary Rules,’ ‘No Discount Rules,’ ‘No Surcharge Rules,’ and ‘Honor All Cards Rules,’ as well as Anti-Steering and other restrictions imposed upon merchants to the detriment of Cardholders,” the lawsuit states. The effect of these rules is such that merchants are prevented or prohibited from informing customers about the true costs associated with different forms of payments and from offering consumers an option to use a credit card with lower fees.

Specifically, “Through their common control of both Visa and MasterCard, Defendants and their co-conspirators have stifled competition between Visa and MasterCard and have thwarted competition from smaller competitor networks such as American Express and Discover,” the class action lawsuit states. “This reduction in competition among general purpose payment card networks has resulted in higher Interchange Fees, hindered and delayed the development and implementation of improved network products and services, and has lessened consumer choice.”

So these allegations, if proved true, would go along way to explaining how Visa and Mastercard can afford to pony up $5.7 Billion to settle an antitrust class action…but not everyone is happy with this settlement…

Top Settlements

Visa & MasterCard Pay Up… A settlement has been approved in a credit card fees class action lawsuit, by a United States federal judge. The settlement is for an estimated $5.7B, between Visa Inc (NYSE:V) and MasterCard Inc . The lawsuit was brought by thousands of retailers who alleged the credit card companies fixed fees that are charged to merchants every time their customers made use of their debit or credit cards. Additionally, the lawsuit claimed that Visa and Mastercard prevented merchants from informing customers about other forms of payments that were considerably cheaper.

The judge’s approval came amidst objections from literally thousands of retailers who were complaining that this amount was inadequate. It is believed that this settlement is the largest in any United States antitrust class action.

The class action was initially brought against Visa, then Mastercard in 2005, with both companies accused of fee fixing. A fairness hearing was held in September. The original settlement amount was $7.2B but was reduced to $5.7B after thousands of merchants dropped out of the settlement deal. The updated Visa and MasterCard settlement provides for cash payments to merchants across the country and also permits then to start charging customers and additional fee whenever a Master or a Visa card is used.

The National Retail Federation’s general counsel, Mallory Duncan said in a statement that his organization which had opposed this deal was now reviewing the ruling that they are expecting to file an appeal.

Ok Folks, That’s all for this week. Happy Holidays, be safe, and we’ll see you at the bar in time for a toast to 2014!

Week Adjourned: 7.5.13 – Kendra Wilkinson AbCuts, BofA, BP Bad Gas

The week’s top class action lawsuits and settlements. This week, top stories include Kendra Wilkinson and AbCuts diet supplements, Bank of America debt collection harassment, and BP contaminated gas.

Top Lawsuits

The Girls Next Door are in trouble—well—one of them at any rate. Kendra Wilkinson, the former star of “The Girls Next Door” and “Kendra,” is facing a consumer fraud class action lawsuit over allegations she advertised a fat loss supplement that is ineffective and possibly dangerous to people’s health. The other named defendants are marketer Corr-Jensen Inc, and nutritional supplement retailer GNC Corp.

Adam Karhu filed the Kendra Wilkinson weight loss lawsuit, alleging the diet supplement “Ab Cuts” (Abdominal Cuts) fat loss supplement was advertised by Wilkinson as “a health supplement, not a diet pill,” which was false and misleading. Ok people, really? In what universe does the name Ab Cuts sound like a health supplement?

Entitled Karhu v. Corr-Jensen Labs Inc. et al., Case No. 13-cv-03583, in the U.S. District Court for the Eastern District of New York, the lawsuit specifically claims that Wilkinson promotes Ab Cuts on her website and through Facebook and Twitter, in addition to appearing on almost all product promotions, including appearances on talk show appearances and in celebrity magazines. According to the lawsuit, Wilkinson makes paid appearances at GNC stores across the country, claiming that Ab Cuts is her “I-Cheat-Every-Day Diet.” Note to Kendra: careful what you say…this lawsuit may give new meaning to “cheat”…)

The Ab Cuts product line has 11 different dietary supplement products all made with the same active ingredient, conjugated linoleic acid (“CLA”). According to the product advertising, CLA promotes fat and weight loss. But—according to the lawsuit, the science just ain’t there. In fact, the complaint alleges that CLA may actually increase the risk of type 2 diabetes, cardiovascular disease and hypertension. That sounds healthy!

Putative members of the Kendra Wilkinson diet lawsuit include anyone in the US who bought Ab Cuts, excluding people who purchased the products for resale. The AbCuts lawsuit alleges breach of express warranty, breach of the implied warranty of merchantability, unjust enrichment, violation of the Magnuson Moss Warranty Act, and for violation of New York’s consumer protection laws.

Bank of America (BoFA) got nailed this week, with a debt collection harassment class action lawsuit alleging America’s biggest bank is in violation of the federal Telephone Consumer Protection Act (TCPA) and the Florida Consumer Collection Practices Act. Add this to the list of possible legal digressions.

Filed by Broward County resident Marc Katz, the lawsuit, entitled, Marc Katz v. Bank of America NA, case number 0:13-cv-61372, U.S. District Court for the Southern District of Florid, alleges BoFA uses automated dialers to call the cell phones of people who have debt with the bank. That would certainly raise your blood pressure.

Specifically, Katz claims that in 2010 BoFA launched a mortgage foreclosure action against him in Florida state court. The bank then continued to call his cellphone using automated dialing systems in an effort to try and collect the purported debt. This occurred even after the bank was told to contact Katz’s attorney for anything related to the foreclosure action, according to the lawsuit.

“Despite receipt of a letter of representation, and its inherent cease communication directive, defendant’s continued collection efforts involved the placement of auto-dialed calls and/or recorded messages to the cellular telephones of allegedly delinquent consumers,” the debt collection harassment class action lawsuit states.

Further, Katz claims that when he answered the calls a machine-operated voice would advise him to “please hold for the next available representative,” forcing him to wait and listen to music or “dead air” before an actual person came on the line, the lawsuit states. “Defendant’s persistent and unlawful calling campaign was carried out with the intent to abuse and harass the plaintiff,” the lawsuit claims.

Heads up—the lawsuit has been filed on behalf of a putative class consisting of all individuals in Florida who were the subject of Bank of America’s debt collection activities related to their residential property in Florida and who were represented by counsel with respect to said debt and still received pre-recorded or auto-dialed calls on their cellphones from the bank over the past four years.

Top Settlements

Did you buy dodgy gas from BP? If so, you may be in line for some cash. The petrochemical giant (BP Products North America Inc), reached a $7 million defective product settlement concerning allegations it sold contaminated gasoline. Contaminated gasoline? Don’t get me started.

According to a statement issued on the settlement, the BP contaminated gas lawsuit was filed after BP recalled approximately 4.7 million gallons of contaminated gasoline, which it distributed from its Whiting, Indiana, refinery to more than 575 retail outlets in Indiana, Illinois, Wisconsin and Ohio.

Various problems, ranging from engine issues to damaged fuel systems, resulted from the use of the contaminated gasoline, affecting thousands of customers. According to the statement, people who are eligible for a portion of the settlement will be notified in the near future…

Ok folks, Happy July 4 Weekend! See you at the bar!

Week Adjourned: 4.19.13 – Kashi, Bankers Life, Bank of America

Hot Class Action Lawsuit News Update: Week Adjourned: 4.19.13 – Kashi, Bankers Life, Bank of America

Top Class Action Lawsuits

What’s in your cereal? Kashi Co, and parent company Kellogg are facing a class action lawsuit over allegations their cereal is mislabelled, effectively hiding the amount of sugar in the products.

And it’s not just cereal, apparently. According to the Kashi class action lawsuit, dozens of Kashi products are allegedly mislabeled, including cereal, chips, crackers and bars, pasta and frozen entrees.

The lawsuit, entitled Nadine Saubers v. Kashi Co., Case No. 13-cv-00899, U.S. District Court for the Southern District of California, states “Nearly all of Kashi’s products’ labels list ‘evaporated cane juice’ as an ingredient despite the fact that the FDA has specifically warned companies not to use the term because it is ‘false and misleading,’ is not ‘the common or usual name of any type of sweetener,’ and the ingredient is not, in fact, juice.”

Lead plaintiff Nadine Saubers, alleges Kellogg and Kashi are in violation of consumer protection laws which regulate food labeling, specifically by their use of the term “evaporated cane juice” instead of sugar, and by failing to disclose that the ingredient is still considered to be processed sugar. Yes, you have heard this one before …

The Kashi class action lawsuit seeks to represent a proposed class of all US residents who purchased Kashi mislabeled products since October 1, 2009, including a subclass of California purchasers.

Long Term Care Falls Short. Heads up to anyone with elderly parents who have paid into Chicago-based insurance company Bankers Life and Casualty long-term health benefits plans. The insurer is facing a bad faith insurance class action lawsuit alleging the company is denying benefits to those who paid for long term health care insurance so they would have security in their old age.

The Bankers Life class action, alleging elder abuse, was filed on behalf of four individuals (two harmed families) who have made claims as representatives of the class. Hundreds, possibly thousands of elderly customers are estimated to be affected by this action. The Oregon action is similar to other lawsuits against Bankers Life in other states.

Grants Pass resident Dennis Fallow, a plaintiff if the lawsuit, claims his mother has paid their premiums for years, counting on having support if she became ill. “That time came and all she got from Bankers Life was a cold shoulder, rejection and red tape. It was a total rip off,” he said in a statement to the press.

Fallow’s 79-year-old mother, Katherine Fallow, needed an in-home caregiver when she came home in 2009 following multiple hospitalizations. The family hired a caregiver certified as a home health aide by the State of Washington and an Oregon certified home health aide to care for Mrs. Fallow. Dennis Fallow began submitting the bills for that care to Bankers Life, anticipating payment under terms of his mother’s policy. What followed were several months of wrangling over aides’ qualifications, long delays in communications and denials of payments. Bankers Life eventually made payments in the amount of $11,388, far short of the $51,667 the family paid for Mrs. Fallow’s care. Mrs. Fallow died on July 6, 2011.

In 2011, Grants Pass attorney Christopher Cauble filed a lawsuit against Bankers Life on behalf of the Fallows. He soon learned the Grants Pass family wasn’t alone. “Bankers Life has likely refused long term health care benefits to many, many Oregonians,” Cauble told reporters. “I began hearing about other families with experiences similar to that of the Fallows. What we have in Bankers Life is a company with a history of raising premiums, delaying payments and denying legitimate claims.” Cauble’s findings prompted him to join with Portland attorney Mike Williams and his firm to file the federal class action against Bankers Life on behalf of all Oregon consumers.

FYI—in 2011, Bankers Life ranked worst (19th out of 19 companies) in the Oregon Department of Consumer and Business Services’ (DCBS) consumer complaint index. In fact, DCBS figures show Bankers Life ranked worst for consumer complaints every year from 2005 to 2011. Now there’s something to aspire to.

Top Settlements

News in the never-ending saga of mortgage-backed securities—this one was all over the wires this week—Bank of America reached a tentative settlement in the pending securities fraud class action lawsuit brought by investors who purchased mortgage investments from Countrywide Financial. BofA acquired Countrywide in 2008.

The proposed settlement would see BofA pay $500 million to settle the lawsuit, which would be paid out to plaintiffs that include Dubai’s Mashreq Bank and public and union pension funds in California, Maine, Nevada, Vermont and Washington states. The plaintiffs claimed they were misled about the risks of securities they bought from California-based Countrywide between 2005 and 2007.

The settlement surpasses the $315 million accord reached with Merrill Lynch in May 2012, making it the largest to resolve federal class-action litigation over mortgage-backed securities since the financial crisis began. The accord requires court approval.

Ok—that’s a wrap. See you at that bar…

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: 11.11.11

The weekly wrap up of Class Action Lawsuits and Settlements for the week ending November 11, 2011.

Top Class Actions

We’re Mad about Madoff! Still. Again. No kidding. Only this time someone’s naming a bank. Two former Bernard L. Madoff investors have filed a proposed consumer fraud class-action lawsuit against JP Morgan Chase & Co, claiming the banking giant was complicit in aiding Madoff in orchestrating the Ponzi scheme that robbed investors of more than $65 billion.

The lawsuit comes after a similar suit filed by the trustee appointed to represent Madoff’s victims was dismissed. The court ruled that the case filed by Irving Picard lacked standing, holding those claims belonged exclusively by the victims of Madoff’s fraud.

Among the allegations leveled in the lawsuit, investors charge that JP Morgan operated as Bernard L. Madoff Investment Securities LLC’s (BLMIS) primary banker for more than 20 years, and were faced with many indications that the fund was nothing more than a Ponzi scheme.

The lawsuit details that since 1986, all the money BLMIS collected from unwitting investors passed through JP Morgan in an account known as the 703 Account, where BLMIS co-mingled funds from investors.

The lawsuit contends that JP Morgan should have known that BLMIS’s activities were grossly inconsistent with those of an investment firm through a number of signs of impropriety.

JP Morgan, for example, was required to review a filing submitted by BLMIS to the SEC known as the Financial and Operational Combined Uniform Single Reports or FOCUS. That report, the lawsuit states, contained glaring irregularities that JP Morgan should have reported to the SEC, including factual omissions and errors, such as failing to report any commission revenue.

Beginning in 2006 JP Morgan sold structured investment products related to BLMIS feeder funds to its clients, profiting on those transactions as well. In the course of structuring those products, JP Morgan performed due-diligence on BLMIS and became suspicious that the BLMIS was a fraud but did not report its findings, the lawsuit alleges, but did redeem $145 million from BLMIS and $276 million from BLMIS feeder funds in 2008.

The lawsuit has been filed on behalf of Stephen and Leyla Hill, investors who incurred losses in BLMIS. It claims JP Morgan had knowing participation in a breach of trust, aided and abetted fraud, aided and abetted a breach of fiduciary duty, aided and abetted conversion and received unjust enrichment. The suit seeks damages for the plaintiffs.

Top Settlements

Big Banks paying Big Bucks: But are the bucks big enough? A $410 million settlement was approved this week—you may have seen it splashed all over the news—by a federal judge in Miami, ending an overdraft fees class action lawsuit against Bank of America (BoFA) that claimed the bank charged excessive overdraft fees.

Only thing is there are reportedly more than 13 million current and former customers who will be affected by the decision, customers who used debit cards over the past 10 years. Some reports suggest that most of the plaintiffs will likely only receive a fraction of the overdraft fees they paid. Ummm.

The lawsuit alleged that BoFA processed its debit card and check payments in such a way as to incur more customer overdrafts and consequently more fees. BoFA insists that its system was proper, despite the settlement. The settlement includes an estimated $123 million in legal fees for plaintiff’s lawyers…

Another bittersweet asbestos settlement this week. The widow of a man who died from peritoneal mesothelioma cancer has been awarded a settlement—a “substantial” sum—amount not publicly disclosed as compensation for loss of her husband, to put it bluntly. The settlement, negotiated on behalf of Mrs. Veraldo, was obtained midway through trial.

Mrs. Veraldo sued as executrix of the estate of her late husband, Randy Veraldo. He was 52 when he died in 2009, seven months after being diagnosed with peritoneal mesothelioma cancer, court records show.

Mr. Veraldo was a parts handler at a Teterboro, N.J., warehouse from 1978-85. The job required him to unpack clutch plates delivered on a near-daily basis from various suppliers. The clutch plates were said to contain asbestos, a mineral once widely used in the U.S. as a cheap insulating material until it was found to cause mesothelioma cancer.

Ok—That’s enough for this week. See you at the bar. And on this Veterans Day, a toast to all veterans, living and gone, the world over.

Week Adjourned: 3.4.11

Top Class Actions

Glass Ceiling with a $100M Price Tag at CIGNA? Well, this has certainly been a time for discrimination class actions. Filed, that is. Topping the list—Cigna Health Care—based on the number of potential plaintiffs—dollars. This one’s all about gender discrimination—in the form of a hostile work environment and differential treatment of males and females occurs company-wide the suit alleges.

The complaint, filed by Ms. Bretta Karp, a long-time contracting manager with Cigna, claims that Ms. Karp and other female employees were disriminated against by treating them less favorably than male employees in similar positions and by subjecting all females to intentional, deliberate and wilful discriminatory denials of promotions and pay raises, discriminatory evaluations, disparate terms and conditions of work, harassment, hostile work environments, and other forms of discrimination in callous disregard of their rights.

The complaint further details that CIGNA has created a hostile work environment where male supervisors harass and intimidate female employees, where management has made clear that it favors male employees over women, and where company investigations into complaints made by female employees are either nonexistent or superficial and inadequate.

And the amount sought in damages? $100 million baby—along with litigation costs and Continue reading “Week Adjourned: 3.4.11”

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.