Class Action Lawsuit

Week Adjourned: 7.24.15 – Priceline, JP Morgan Chase, Foot Locker

Top Class Action Lawsuits

Priceline’s “Name Your Own Price” …may be rebranded as “Name Your Own Settlement” if this goes to court. The internet-based hotel booking company is facing a proposed consumer fraud class action lawsuit alleging it conceals known, mandatory resort fees from “Name Your Own Price” bidders, misleading thousands of customers about the actual price of their bookings. Something to do with hidden resort fees—ringing any bells folks?

Filed in in Connecticut federal court by lead plaintiff Adam Singer, the Priceline lawsuit contends that travelers who use Priceline’s “Name Your Own Price” feature to bid on hotel rooms, end up paying undisclosed fees to Hilton and other hotels on top of what they offered.

“This conduct renders the ‘Name Your Own Price’ option illegal and deceptive,” the complaint states. “Due to defendant’s conduct, a consumer is not ‘naming his own price’ for a hotel stay at all.”

In the complaint, Singer states he used the “Name Your Own Price” option to find a hotel in Puerto Rico within his budget. Priceline matched him with a Hilton property and presented with a contract, which quoted his offer price plus $60.68 in taxes and fees, which he accepted.

However, the Priceline lawsuit contends that when Singer went to check out of the property, the hotel had added $66 in mandatory resort fees in addition to the price he had agreed to pay through Priceline, prior to his stay. The lawsuit alleges that Singer was not informed in advance of those fees as Priceline didn’t adequately inform him that any resort fees would be included in the total price for his accommodation.

“Priceline could easily have programmed its Name Your Own Price bidding system to account for resort fees which it knew full well would be charged and thus match consumers only with hotels truly willing to accept their bid amounts,” the lawsuit states. “Instead, it affirmatively chose to delete resort fees from ‘total’ ‘taxes and service fees,’ in order to make it appear to consumers that they were getting a better deal than they truly were.”

The lawsuit further claims that Hilton benefits from Priceline’s deception because it charge guests, after the fact, more than they would knowingly consent to pay.

“By the plain terms of the Priceline.com booking contract, Hilton had no right to charge mandatory resort fees on that booking,” the complaint states. “By recovering an additional, baseless fee in the form of the resort fee, defendants are able to reduce its advertised room rates by the amount of the resort fee without any negative impact when price-conscious consumers compare rates across hotels.”

Singer is seeking to represent a class of Priceline “Name Your Own Price” customers allegedly misled by the booking site’s silence on resort fees and a subclass of consumers who booked Hilton stays that cost more than expected for that reason.

The case is Singer v. The Priceline Group Inc. et al., case number 3:15-cv-1090, in the U.S. District Court for the District of Connecticut.

Top Settlements

They’re Baaaack...Here’s one for the record books, apparently, and likely in more ways than one.

A $388 million settlement has been agreed between JPMorgan Chase and a group of investors who alleged the bank misled them regarding the level of risk associated with certain investments. Specifically, the securities lawsuit refers to $10 billion worth of residential mortgage-backed securities (MBS) sold by JP Morgan Chase before the financial crisis of 2008. Remember those?

The lawsuit was brought on behalf of investors and two pension funds, namely Laborers Pension Trust Fund for Northern California and Construction Laborers Pension Trust for Southern California. In the lawsuit, they alleged the values of their investments were severely impacted by the losses incurred on the mortgage bonds during the financial crisis. (Whose investments weren’t impacted by MBS fraud?)

According to a statement issued by JP Morgan Chase, this settlement represents, on a percentage basis, “the largest recovery ever achieved in an MBS purchaser class action.” And that’s something they’re proud of?

Foot Locker Gets Clocked. Here’s a long-deserved bit of good news for Foot Locker employees. Final approval of a $7.1 million settlement has been granted, ending a long-running wage and hour class action against Foot Locker Inc. The lawsuit, brought by Foot Locker workers, alleged the retail shoe chain violated the Fair Labor Standards Act (FLSA).

Specifically, the plaintiffs alleged that Foot Locker workers were not compensated for maintenance work and time spent working before opening and after closing. Further, the lawsuit claimed that company employees were forced to do work off-the-clock or have their paid time cut in order to complete their tasks.

According to the allegations, Foot Locker directly tied the compensation of its store managers to its labor budget set by the corporate office, in order to enforce the compensation policy. If the managers exceeded the budget, they were punished, according to the original complaint filed in 2007 by named plaintiff Francisco Pereira.

The nationwide FLSA class includes all current and former Foot Locker employees who worked at least one hour from March 2007 to March 2010 in the US as a retail employee but not as an assistant store manager or higher. A separate Illinois class includes any retail employee excluding assistant store managers and above who worked in the state from October 2005 to May 2011.

The case is In Re: Foot Locker Inc. Fair Labor Standards Act (FLSA) and Wage and Hour Litigation, case number 2:11-md-02235, in the U.S. District Court for the Eastern District of Pennsylvania.

Ok – That’s a wrap folks…See you at the Bar!

Week Adjourned: 7.17.15 – Walmart, Gerber, Hotel Wrongful Death

Top Class Action Lawsuits

Save Money. Live Better…? Words to live by…except for…Walmart got hit with a discrimination class action lawsuit this week, filed by an employee alleging the company denies its staff benefits for same-sex spouses. Filed by Jacqueline Cote, the lawsuit claims that Walmart repeatedly denied medical insurance for her wife before 2014, when the retail giant started offering benefits for same-sex spouses.

The back story…Cote and Simpson met in 1992, while they were both working at Walmart in Augusta, Maine. They subsequently moved to Massachusetts and remained employees of Walmart. They were married in May 2004, days prior to the legalization of same-sex marriage in that state.

In 2007, Smithson quit her job at Walmart to take care of Cote’s elderly mother. As a result Cote attempted to have Smithson added to her employee health plan the following year.

In 2012, Cote’s wife was diagnosed with ovarian cancer, which resulted in the couple incurring $150,000 in medical bills.

According to the proposed Walmart class action, Cote tried to enroll her spouse online, but the system wouldn’t let her proceed when she indicated her spouse was a woman. When she sought an official explanation, she was told that same-sex spouses were not covered. Cote continued to try and have Smithson enrolled in her Walmart employee health plan every year thereafter including the year Smithson was diagnosed with cancer.

The lawsuit seeks damages for the couple and any other Walmart employees who weren’t offered insurance for their same-sex spouses. A federal commission concluded that Walmart’s denial amounted to discrimination and said in May that Cote could sue.

Although no other Walmart employees are named in the suit, it seeks damages for those who come forward. Further, the suit seeks damages for Cote and her wife, Diana Smithson, and it asks Walmart to acknowledge a legal responsibility to continue offering benefits for same-sex spouses.

What’s Gerber been Puffing On? Gerber, famous maker of healthy baby foods and an instantly recognizable household brand, got slapped with a consumer fraud class action lawsuit alleging the company is misleading parents into buying a product that is far from nutritious. The product? Graduates Puffs food for toddlers. Puffs? Really?

According to the Gerber Graduates lawsuit, the packaging for Puffs is dominated by pictures of fruit or vegetables: juicy peaches, slices of ripe banana, nutritious sweet potatoes. But the ingredients list belies these pictures. Banana-flavored Puffs contain no bananas, only a trace amount of banana flavoring. Sweet potato-flavored Puffs don’t contain actual sweet potatoes, or any other vegetable, only miniscule amounts of sweet potato “flavor.” The closest thing to a fruit or vegetable in Puffs is a very tiny amount of dried apple puree, powder, in other words.

The suit alleges that parents trying to buy healthy and nutritious snacks for their toddlers have trusted Gerber’s reputation and package presentations, paid Gerber’s premium prices based on that reputation, and, in exchange, unwittingly provided their toddlers with empty calories. Far from the healthy treat the labels and Gerber’s reputation suggest, Puffs are little more than flour and sugar. Doesn’t sound like brain food to me…

The lawsuit was filed in the Superior Court of California, San Francisco County, and is titled Gyorke-Takatri, et al., v. Nestle USA, Inc. and Gerber Products Company.

Top Settlements

Huge Settlement for a Huge Loss…and a cautionary tale in more ways than one…a Florida jury awarded a $24,057,83.00 verdict in a wrongful death lawsuit involving The Riverside Hotel in Fort Lauderdale. In 2012, a newlywed couple were visiting the hotel on their honeymoon. They were killed by a speeding car. The lawsuit alleged that the Riverside Hotel had actual or constructive knowledge that motor vehicles regularly and routinely exceeded the posted speed limit in proximity to the hotel property.

Michael and Alanna DeMella, who were seven months pregnant, checked into the hotel and went to the pool. According to media reports they had stepped into the cabana restroom moments before the incident. Mrs. DeMella was killed on hotel property while in an on-site pool cabana, by Rosa Kim, who drove into a structure on hotel property utilized by hotel guests in the pool area as she used excessive speed on the adjacent road.

In hearing the evidence, the civil jury entered a verdict that found the Riverside was 15% responsible for the tragedy and that they should pay that portion of the verdict.

That’s a wrap folks…See you at the Bar!

Week Adjourned: 7.10.15 – Ford, Capital One, Transvaginal Mesh

Top Class Action Lawsuits

Ford is not in the driver’s seat on this one…They got hit with a defective design class action this week, alleging certain Ford Explorer, Ford Edge and Lincoln MKX models allow carbon monoxide to enter the passenger compartment. Yeah, not so good guys. The suit covers 2011-2015 Ford Explorers as well as Edge and MKX models from 2011-2013 with 3.5L and 3.7L TIVCT engines.

The proposed Ford class action was filed on behalf of New Jersey owners or lessors of the vehicles in question. The complaint also proposes a subclass of consumers with claims under New Jersey’s Lemon Law for claimants who reported the defect to Ford in the first two years or 24 months of ownership.

According to the legal documents, Ford has known of the defect since 2012 but has not warned owners to get it fixed. Surprised? Apparently Ford has issued two technical safety bulletins to dealers about the problem but to date, has not notified owners, despite the related safety hazard. Ford has attempted to fix the problem on customers’ vehicles with a variety of remedies but none have proved effective, according to the complaint.

“Given that the defect renders driving the subject vehicles a health hazard that is potentially deadly, the vehicles are valueless,” the lawsuit states.

The lawsuit alleges breach of implied and express warranty, violation of the New Jersey Consumer Fraud Act, of the Magnuson-Moss Warranty Act, and of the New Jersey Motor Vehicle Warrant Act, also known as the Lemon Law. Love that Lemon Law!!!

Capital One should change its tag line…from “What’s in your Wallet” to “If at first you don’t succeed.” These guys are frankly, incorrigible—nay—unrepentant. They are facing yet another robocalls class action lawsuit—this one against Capital One Financial Group. Filed by plaintiff Nakia Pitr, this latest lawsuit alleges Capital One is in violation of the Telephone Consumer Protection Act by calling consumers through robodialing without their consent. Yeah, know this one off by heart.

Pitre claims in the Capital One lawsuit that within the space of two months, she received 37 calls on her cellphone from the bank, despite not being a customer. Capital One ignored her requests to stop calling, she claims.

According to the lawsuit, the calls were from the company’s credit card division. During each of the calls she received and answered, she told the bank they had the wrong number and asked them to stop calling. However, she continued to receive calls. According to the suit, the frequency and nature of the calls indicates they were made from an automatic telephone dialing system.

Pitre further alleges she has never been a Capital One customer, has never given the bank her number or given her consent for them to call her.

If approved, the class would include anyone contacted by Capital One using a robodialing system from July 1, 2014, through July 2, 2015, without prior consent and who received calls after asking not to be contacted.

FYI—the case is Pitre v. Capital One Financial Corporation, case number 1:15-cv-00869, in the U.S. District Court for the Eastern District of Virginia.

Top Settlements

Not a class action settlement—but a significant settlement none the less. Sadly, at great personal expense. Boston Scientific has been ordered to pay a $100 million settlement by a jury hearing the case of a women who suffered injury from the company’s Pinnacle and Advantage Fit vaginal mesh. Fifty-one year old Deborah Barba was awarded $25 million in compensatory damages with an additional $75 million in punitive damages.

In her personal injury lawsuit, Barba alleged she received a Boston Scientific’s Pinnacle mesh product in 2009 for pelvic organ prolapse (POP) and stress urinary incontinence (SUI). However, following the implant she began experiencing serious medical complications and despite two subsequent surgeries to rectify the problems, parts of the vaginal mesh implant remain in her body and continue to cause her pain.

The trial took just two weeks, after which the jury reached a decision within seven hours. They found Boston Scientific was negligent in designing and making the devices and that it had failed to warn patients and doctors about potential risks.

To date, this verdict is the largest regarding litigation over transvaginal mesh devices against Boston Scientific or any other mesh manufacturer. The company announced last month it had reached agreements to pay about $119 million to resolve 2,970 cases about transvaginal mesh. There are more than 25,000 defective product lawsuits pending against Boston Scientific concerning injuries resulting resulting from the Pinnacle mesh implant.

Reuters reports that this latest verdict is the sixth so far against the company by women who say that the devices are poorly designed and use subpar materials, resulting in painful physical injuries such as bleeding, infection and pain during sex.

That’s a wrap folks…See you at the Bar!

Week Adjourned: 7.4.15 – Kenneth Cole, Pure Leaf Iced Tea, Toyota

Top Class Action Lawsuits

Kenneth Cole bagging profits at customers’ expense? At least those are the allegations in a consumer fraud class action lawsuit filed against Kenneth Cole Productions Inc.

Specifically, the Kenneth Cole Outlet lawsuit alleges that the retailer misleads customers into believing they are purchasing items at a savings at its exclusive outlet stores by listing artificially high “suggested retail prices” on its product tags next to the term “our price” which is significantly lower. The lawsuit claims that because these products were never for sale in any other store, Kenneth Cole is in violation of California and federal laws.

“The plaintiff, in short, believed the truth of the price tags attached to the products she purchased at a Kenneth Cole outlet, which expressly told her that she was getting a terrific bargain on her purchase,” the complaint said. “In fact, she was not getting a bargain at all.” Filed by lead plaintiff Peggy Cabrera, the lawsuit asserts that Cabrera was induced to purchase a sweater and shirt top from a Kenneth Cole Outlet store in California after noticing significant differences in price between the “MSRP” and “our price” label, particularly after observing that not all product price tags made this distinction.

“In reality, Kenneth Cole never intended, nor did it ever, sell the item at the represented ‘MSRP,’” the complaint states. “Thus, plaintiff was deceived by the false price comparison into making a full retail purchase with no discount.”

In the lawsuit, Cabrera contends that Kenneth Cole is taking advantage of the term “outlet store” because the idea of shopping there conveys to reasonable consumers that at least some products comprise merchandise formerly offered for sale at full-price retail locations, which is not the case at exclusive Kenneth Cole outlets.

Further, the complaint states that the Federal Trade Commission explicitly describes the fictitious pricing scheme employed by Kenneth Cole as deceptive, making it a violation of the FTC Act, as well as the California Business and Professions Code.

Pure Leaf Iced Tea = Pure B.S.? While we’re on the subject of consumer fraud…Unilever United States Inc. and PepsiCo. Inc. are facing a putative class action alleging false advertising regarding their jointly produced Pure Leaf iced tea products. Specifically, the lawsuit claims the teas are falsely branded as “All Natural” and free from preservatives when in fact they contain a non-naturally produced citric acid as a preservative.

Named plaintiff Momo Ren alleges that the defendants engaged in an aggressive marketing campaign that claimed the teas are “nothing but all natural, freshly brewed tea from tea leaves,” which was designed to attract consumers seeking those types of products.

According to the Pure Leaf lawsuit, citric acid is no longer made from fruit but rather manufactured through citric acid bacteria fermentation. It is classified by the USDA as a “synthetic allowed” substance. Therefore, PepsiCo. and Unilever, through a partnership with Unilever-owned Lipton Tea conspired to produce Pure Leaf, the advertising for which is in violation of federal and state consumer protection laws against misbranding.

“By marketing the products as being ‘All Natural’ and free of preservatives, defendants wrongfully capitalized on and reaped enormous profits from consumers’ strong preference for food products made entirely of natural ingredients and free of preservatives,” the suit states.

The plaintiff has filed claims of deceptive trade practices, negligent misrepresentation, breach of express warranty and unjust enrichment and seeks unspecified compensatory and punitive damages.

Top Settlements

Toyota Power Steering… Don’t have a dollar figure for this one BUT 800,000 Toyota customers are going to sleep easier as a result of a settlement reached with the car maker in a pending defective automotive class action lawsuit. The suit, filed in California federal court, claims that the power steering systems of some Corollas caused the vehicles to drift out control.

According to court documents, lead plaintiffs Irene Corson and Susan M Yacks, and Toyota, sought preliminary approval of the deal in March, the terms of which state that Toyota denies any defect with the electronic power steering system in the 2009 and 2010 model year Corollas at issue.

Under the terms of the settlement, class members who have complained about the on-center steering feel of their vehicle will have their retuned electronic control units installed at no cost. For those who haven’t previously complained, the retuned electronic control unit will be available at a 50 percent discount. Class members who paid out-of-pocket to have the returned electronic control unit installed may be reimbursed up to $695, according to the settlement memorandum.

Court documents show that The National Highway Traffic and Safety Administration opened an investigation in February 2010 of the electric power steering system in the Corolla and Matrix models. The investigation revealed related consumer complaints dealing with operational issues, not failure of steering elements. The investigation was closed by May 2011.

Under the terms of the deal, class counsel can ask for attorneys’ fees and expenses, and class representative incentive awards up to $750,000. The case is Irene Corson et al. v. Toyota Motor Sales USA Inc. et al., case number 2:12-cv-08499, in the U.S. District Court for the Central District of California.

Ok—that’s it for this week folks—see you at the bar! And Happy 4^th of July!

Week Adjourned: 6.26.15 – NFL Sunday, Beck’s Beer, Colonoscopy Med Mal

Top Class Action Lawsuits

Fans of Sunday Night Football are making an end run at the NFL and DirecTV, having filed an antitrust class action lawsuit, over the bundling of games in the NFL Sunday Ticket package. Specifically, the lawsuit claims that Sunday Ticket subscribers should not be forced to pay several hundred dollars for the NFL’s entire spectrum of out-of-market games just so they can follow one team or see an individual game.

Filed in California by Thomas Abrahamian, the NFL Sunday lawsuit states: “The league and DirecTV offer NFL Sunday Ticket only as all-or-nothing….Purchasers of NFL Sunday Ticket must buy all out-of-market games for all teams even if they are only interested in watching the games of a particular team. Likewise, consumers must buy the complete season of games and may not purchase individual games.”

“A Cleveland Browns fan living in California cannot watch the Browns play, except occasional games on network television, unless he purchases the entire package of League games from NFL Sunday Ticket,” according to the complaint. The lawsuit is Case 2:15-cv-04606-BRO-JEM.

Top Settlements

I’ll Drink to That! A settlement has been reached in a consumer fraud class action lawsuit pending against Beck’s Beer. The lawsuit alleges that the beer is produced in St. Louis and brewed with water from Missouri, not imported from Germany, as customers may have been led to believe.

Anheuser-Busch, the makers of Beck’s, ‘tricked’ consumers into thinking Beck’s was a German beer, according to the lawsuit. The beer used to be brewed in Germany by its German owners until 2002 when it was sold to Belgium’s Interbrew, which then merged with Brazil’s AmBev, to become InBev, which in turn acquired Anheuser-Busch. Production of Beck’s moved to St. Louis in 2012, according to the lawsuit.

According to the Beck’s settlement terms, eligible class members are entitled to a refund of up to $50. Settlement class members include customers who purchased Beck’s beer, including Beck’s Dark and Beck’s Light, since May 2011. The settlement has yet to receive final approval but if approved, class members can fill out an online form to claim a refund. Beck’s drinkers can get 10 cents back for every individual bottle purchased; 50 cents for a six-pack or $1.75 per 20-pack.

Refunds will be capped at $50 for claims backed by a valid proof of purchase. Consumers who didn’t keep receipts are entitled to no more than $12. Full terms will be made public upon final approval of the settlement.

Additionally, under the settlement terms, Anheuser-Busch agreed to make labeling adjustments. A statement on the bottle saying it’s made in the USA will become more visible. The green boxes in which the bottles are packaged will also say the beer is made in the USA. So much for “who reads the packaging anyway?”

Patient Privates Undergo “Review” During Colonoscopy… You can’t make this stuff up! An unidentified patient in Virginia has been awarded $500,000 by a jury hearing his medical malpractice lawsuit which claims his anesthesiologist made defamatory comments while he was under sedation for a colonoscopy. The award includes $200,000 in punitive damages.

The unidentified plaintiff, referred to as DB, had left his smart phone on record so he could ensure he got his doctor’s post-surgical instructions, according to the Washington Post. (What ever happened to the patient consult?) However, during the procedure his trousers were placed under him, (Why?) which resulted in the inadvertent recording, court papers indicate.

When DB listened to the recording on his way home from the surgery, he discovered Dr. Tiffany Ingham mocking and disparaging him. Among the comments was a referral to a rash on the plaintiff’s penis, which Ingham incorrectly suggested indicated syphilis and tuberculosis. Nice.

The jury awarded $50,000 in compensatory damages for defamation for the doctor’s remarks about each of these diseases, and another $200,000 for overall medical malpractice. Ingham also allegedly said she was going to note in the man’s chart that he had hemorrhoids, which he didn’t.

DB also sued a gastroenterologist, Soloman Shah, who, while present for the procedure, did not directly participate in most of the commentary by Ingham. Smart…That portion of the case was dismissed.

And it’s off to the rodeo!

That’s a wrap folks…See you at the Bar!

Week Adjourned: 6.19.15 – Shutterfly, Michael Kors, Hip Replacement

Top Class Action Lawsuits

Shutterfly may have its wings clipped. The company that developed the facial recognition software has been hit with a putative class action lawsuit over alleged privacy violations—actually—violations of Illinois state’s Biometric Information Privacy Act.

Filed by Illinois resident Brian Norberg, the Shutterfly complaint asserts that online image publisher Shutterfly and its subsidiary ThisLife LLC collect facial recognition data from user-uploaded photos without first notifying individuals and receiving their written consent, and by failing to inform them how long the information will be stored and how it will be used.

“Specifically, defendants have created, collected and stored millions of ‘face templates’ (or ‘face prints’)—” highly detailed geometric maps of the face—” from millions of individuals, many thousands of whom are non-Shutterfly users residing in the state of Illinois,” the complaint states.

“Defendants in this case made no effort whatsoever to obtain consent from unwitting third parties when they introduced their facial recognition technology,” the complaint state. “Not only do defendants’ actions fly in the face of FCC guidelines, they also violate the privacy rights of Illinois residents.”

Notably, Illinois law also prohibits companies that collect biometric data from selling it to third parties.

Heads up—Norberg is seeking $5,000 for each intentional and reckless violation, and $1,000 for each violation resulting from defendants’ negligence. Go get’em!

The case is Brian Norberg v. Shutterfly Inc. et al., case number 1:15-cv-05351, in the U.S. District Court for the Northern District of Illinois.

Top Settlements

Settlement in the bag…to the tune of $4.88 million. That’s the number reached in a preliminary settlement between Michael Kors Holdings Ltd and plaintiffs in a class action lawsuit alleging the company engages in consumer fraud.

Ok—you’ve read this song sheet before. The specific allegations are that Michael Kors represents on the price tags of its Kors Outlet Products artificial “suggested retail prices” that do not represent a bona fide price at which the designer formerly sold the products. The tags also offer a price termed “our price,” which represents a steep discount off the false original price.

But the [prices] used by Michael Kors … were a sham. In fact, Michael Kors manufactures certain goods for exclusive sale at its Kors Outlets, which means that such items were never sold, or even intended to be sold at the … price listed on their labels,” the complaint states.

Under the terms of the preliminary Kors settlement Michael Kors will replace “MSRP” with “Value” on its price tags and display signage explaining that term, or stop using reference prices for products made exclusively for its outlets.

If approved, the settlement will include shoppers who bought products from Michael Kors outlets in the four years ending July 25, 2014.

The case is Gattinella v. Michael Kors (USA) Inc et al, U.S. District Court, Southern District of New York, No. 14-05731.

Here’s one for the record books… A jury hearing the first product liability lawsuit against Wright Profemur hip replacement systems has awarded the plaintiff $4.5 million in damages. Brought by Alan Warner, the lawsuit is the first of several hundred to go to trial with allegations that the hip replacement Warner received failed after just three years: the average life span of the system is between 15 and 20 years.

There are over 1,200 similar defect product lawsuits pending against Wright Profemur hip replacement alleging the plaintiffs suffered health problems when the modular femoral neck stem broke.

Warner’s trial lasted two weeks and is the first case to go to court. It is not part of the federal MDL.

Hokee Dokee—That’s a wrap folks…See you at the Bar!

Week Adjourned: 6.5.15 – Hep C Drug Denial, Santa Barbara Spill, Phoenix Life

Top Class Action Lawsuits

How ill is ill enough? And why should the insurer get to decide instead of the physician? These are the issues at the heart of a denied insurance claim lawsuit filed against Blue Cross. The lawsuit alleges the insurer denies its policy holders access to a newly approved and expensive new hepatitis C drug made by Gilead Sciences.

According to the hepatitis C drug lawsuit, the medical insurer has refused its contractual duty to provide coverage for medically necessary treatments for a client who has had hepatitis C for 10 year, and others similarly situated. According to the lawsuit, lead plaintiff Janie Kondell was denied coverage because her “liver had not sufficiently deteriorated.”

“In other words, defendant decided that Ms. Kondell hadn’t suffered enough, and her liver hadn’t been damaged enough, by a disease that causes irreparable harm and death, for which a cure is finally available,” the lawsuit states.

The US Food and Drug Administration approved the treatment, Harvoni, in October 2014. According to the complaint, the drug has a 95-99 percent cure rate. The once-daily pill can cost from $64,000 for an eight-week treatment to $99,000 for a 12-week treatment, and has few side effects.

According to the complaint, prior to approval of Harvoni, the existing treatment for Hep C, a contagious, chronic, potentially fatal condition resulting in liver damage, cirrhosis, infections, cancer, heart attacks and death, was only 70 percent effective and came with significant side effects.

“Hepatitis C is only the second disease or condition for which a cure has been discovered within a single lifespan of the disease or condition discovery,” the complaint states. “Hepatitis C was discovered in 1990 and the cure was approved in 2014. Hepatitis C could be completely eradicated in a few years as a result of Harvoni, assuming patients, such as Kondell, have access to this incredible cure.”

According to the complaint, Kondell has been a policyholder at Florida Blue for over 20 years. She was diagnosed with Hep C, and in February 2015 her physician prescribed Harvoni. Florida Blue immediately denied coverage, the complaint states. Although her doctor appealed the insurer’s decision twice Florida Blue continued to deny coverage, claiming Kondell’s liver wasn’t severely damaged.

“No known medical study supports this denial, and nothing in Kondell’s policy (or any of the class members’ policies) grants defendant the right to withhold a potentially life-saving cure, particularly on the perverse and pretextual ‘basis’ that it is not ‘medically necessary,’” the complaint states.

The complaint claims that Blue Cross is in violation of Florida’s Deceptive and Unfair Trade Practices Act and breached the contract of all policyholders diagnosed with hepatitis C who were denied coverage. The suit is asking the court to demand Florida Blue cover the treatment and seeks unspecified damages in excess of $5 million.

The case is Kondell v. Blue Cross and Blue Shield of Florida Inc., case number 0:15-cv-61118, in the U.S. District Court for the Southern District of Florida.

Oil Spill Launches Legal Clean-Up…The people of Santa Barbara have filed an environmental class action lawsuit against Plains All American Pipeline (NYSE:PAA) stemming from the Refugio State Beach oil spill in Santa Barbara. The class action complaint alleges the Texas-based company negligently operated the pipeline, Line 901, causing a rupture that discharged over 100,000 gallons of crude oil onto beaches and into the Pacific Ocean, damaging ecologically and economically significant natural resources. The complaint claims violations of state and federal laws.

“In Santa Barbara, those environmental impacts translate to profound economic impacts. In the short term, the oil from Plains All American’s ruptured pipeline has closed fishing grounds and shellfish areas, and caused canceled reservations from tourists who otherwise would be spending their money on hotels, restaurants, kayaking or surf trips, and fishing charters,” the complaint states.

The complaint was filed on behalf of Stace Cheverez, a sea urchin diver and nearshore fisherman. Plains All American’s oil spill has led to the closure of areas where Cheverez customarily fishes for commercially valuable nearshore species like Grass Rockfish.

Sadly, Plains All American Pipeline is no stranger to oil spills. The company has accumulated 175 safety and maintenance infractions since 2006. The Pipeline and Hazardous Materials Safety Administration shows Plains’ rate of incidents per mile of pipe is more than three times the national average. “In short, Defendant has an ugly tradition of operating pipelines that fail. The communities through which it transports oil suffer the consequences,” the complaint alleges. Not the neighbor any of us would desire, never mind being a good corporate citizen. What ever happened to that?

The spill, which triggered California Governor Jerry Brown to declare a state of emergency, may have extreme effects on both the environment and economy. Two beaches have been closed and nearby hotels have been fielding calls from concerned visitors who planned on visiting Santa Barbara, one of Southern California’s top tourist destinations, over Memorial Day weekend.

Top Settlements

Phoenix to pony up $42M in bad faith insurance settlement …the bad faith insurance class action lawsuit alleged the insurer unfairly raised rates on premium-adjustable universal life insurance policies. Additionally, the company has also agreed to freeze its rates for five years. Nice.

The Phoenix Life settlement also prevents Phoenix from challenging the validity of any class member’s PAUL policy as an unlawful “life wager,” which the insurer has frequently done in order to avoid paying death benefits, according to the lawsuit.

The class action lawsuit was filed following an announcement by Phoenix Life that it was raising COI rates on PAUL policies in 2010 and again in 2011. The lawsuit alleged the insurer was treating life settlement investors unfairly. Unlike whole life insurance policies that require fixed monthly premium payments, PAUL policies only require premiums to cover COI charges and other expenses, allowing policyholders to minimize their investments, according to the plaintiffs.

The PAUL policyholders claimed Phoenix discriminated against life settlement investors who pay their premiums on time by hiking the COI rates and did so because the company comes out ahead when policies lapse, and it’s able to avoid paying death benefits.

The more than 1,000 class members will be sent checks in the mail, unless they opt out of the settlement. A $25,000 incentive award has been granted for named plaintiff Martin Fleisher.

The case is Fleisher v. Phoenix Life Insurance Co., case number 1:11-cv-08405, in the U.S. District Court for the Southern District of New York.

Hokee Dokee—That’s a wrap folks…See you at the Bar!

Week Adjourned: 5.29.15 – Similac, JC Penney, Capital One

Top Class Action Lawsuits

Heads Up New Parents…Organic Similac not so organic—according to a consumer fraud class action filed against Abbott Laboratories, the maker of Similac infant formula food. The lawsuit alleges the label stating the food is organic is false and misleading because the formula isn’t actually organic.

Filed by Sara Margentette, Matthew O’Neil Nighswander and Ellen Steinlien in U.S. District Court in New York, the Similac lawsuit alleges Abbott’s Similac Advance Organic Infant Formulas contained ingredients that are prohibited in organic foods.

According to the complaint some 26 of the 49 listed ingredients are not allowed in organic food. The suit states the ingredients were “irradiated substances, synthetic compounds, or produced from hazardous substances.”

The plaintiffs claim Abbot described the Similac Infant formula as organic in order to persuade consumers to purchase it, thereby increasing its sales and profits.

“As a result of its false and misleading labeling, Abbott was able to sell its ‘Organic’ Infant Formula to hundreds of thousands of consumers throughout the United States and to realize sizeable profits,” the lawsuit states. Plaintiffs are seeking class certification and more than $5 million in damages plus court costs.

The case is United States District Court for the Eastern District of New York case number 1:15-cv-2837.

JC Penny Nailed re: its Sales? It’s another consumer fraud class action lawsuit for JC Penney over its alleged practice of artificially inflating merchandise prices only to mark them down to create the appearance of a “sale” price. According to the lawsuit, the retail chain’s pricing practices are equivalent to deceptive and fraudulent advertising.

The JC Penney class action was certified last week, and accuses the national retail chain of operating a “massive, years-long, pervasive campaign” to deceive shoppers about its pricing for private-label brands, and for outside brands such as Liz Claiborne, sold exclusively by JC Penny.

The lawsuit states that Cynthia Spann, lead plaintiff in the class action, discovered the deceptive advertising practices after buying three blouses for $17.99 each, a 40 percent discount from the “original” $30 price, only to learn the price was never above $17.99 at any point during the prior three months.

The case is Spann v. J.C. Penney Corp et al, U.S. District Court, Central District of California, No. 12-00215.

Top Settlements

Another Overdraft Fee Class Action is…Over! You gotta love this! Capital One Bank NA has to pony up $31.8 million as settlement of a lawsuit that alleged the bank manipulated its overdraft fees. Approved by US District Judge James Lawrence King, the settlement fund of $31.76 million represents 35 percent of the most damages plaintiffs could expect to recover at trial.

The Capital One overdraft fee lawsuit has taken nearly five years and the class consists of roughly 611,000 members. Capital One tried three times to have the lawsuit thrown out. It alleged that the bank deducted money from customers’ accounts based on the size of their transactions, not in chronological order, thereby maximizing the amount of overdraft fees it charged.

For settlement class members who do not opt out, prorated shares from the settlement fund will automatically be sent to them. Capital One’s data was used to determine which account holders were harmed by the high-to-low posting practice.

The case is In re: Checking Account Overdraft Litigation, case number 1:09-md-02036, in the U.S. District Court for the Southern District of Florida.

Hokee Dokee—That’s a wrap folks…See you at the Bar!

Week Adjourned: 5.22.15 – Starbucks, AT&T, Car Loan Robocalling

Top Class Action Lawsuits

The King of Coffee is facing a class action lawsuit alleging a bit of consumer fraud—in the guise of misleading advertising. The lawsuit alleges Starbucks advertised prices for product that are lower than those charged by baristas. That’s not very nice.

Specifically, the Starbucks lawsuit contends that the coffee brewers advertising for reduced-fat turkey bacon breakfast sandwich and sausage and cheddar breakfast sandwich include prices that are lower than that which the plaintiff, Sarah Martin, paid. The turkey bacon sandwich was advertised for $3.45 when it actually costs $3.75, while the sausage and cheddar sandwich was advertised as $3.25 when the actual price is $3.45, according to the complaint.

Apparently, there are at least seven Starbucks locations in Los Angeles county where the in store pricing is different from the advertised price. The potential class action suit alleges violations of the California statutes covering consumer protection, false advertising, unfair competition, unjust enrichment and fraud. That should about cover it.

Further, the lawsuit contends that Starbuck’s policy regarding receipts helped it conceal the alleged false advertisement. “Plaintiff and members of the proposed classes relied to their detriment on Starbucks misrepresentations regarding the price of goods,” the complaint states. “Starbucks also has the policy of asking consumers whether they would like a copy of their receipt, which makes it harder to discover the misrepresentation.”

The putative class would include any Starbucks customer who purchased items at California locations where the wrong price was advertised in the last four years.

The case is Sarah Martin et al. v. Starbucks Corp. et al., case number BC582335, in the Superior Court of the State of California for the County of Los Angeles.

AT&T is in the Cross-hairs… of an unpaid overtime class action lawsuit brought by a training manager who alleges the company is in violation of California labor law and the Fair Labor Standards Act.

Specifically, the AT&T lawsuit contends that the telecommunications giant intentionally misclassified the workers as being exempt from overtime requirements in order to avoid giving them the extra pay they were entitled to under state and national employment laws.

Filed in the US District Court for the Central District of California, plaintiff Wendell Watson alleges that despite assigning the trainers their work and being aware that they often worked longer than 40 hours a week, AT&T refused to pay overtime to training specialists nationally.

Here’s the skinny, according to a statement issued by attorney’s representing the plaintiff: AT&T employees involved in designing company trainings often work nights and weekends interviewing experts at the company and then passing the information on to instructors. In the lawsuit, Watson, an AT&T training design manager since 2001, states that the workers not only did not receive overtime but also regularly worked more than five consecutive hours without a required half-hour meal break or a second break after working for 10 hours.

The lawsuit also states that “In addition, the California plaintiff and California class members regularly work and have worked without being afforded at least one 10-minute rest break, in which they were relieved of all duty, per four hours of work.”

AT&T is also being accused of failing to provide accurate wage statements, such that workers were not able to determine how much and for what hours they were being paid. Not an uncommon complaint these days, sadly.

The case is Walton v. AT&T Inc., case number 2:15-cv-03716, in the U.S. District Court for the Central District of California.

Top Settlements

Here’s some good news to help your Friday along… A $10.2 million settlement has been agreed between the plaintiffs in a robocall class action lawsuit and JPMorgan Chase Bank NA. The bank allegedly made unsolicited robocalls to more than 2 million customers’ cellphones, in violation of the Telephone Consumer protection Act (TCPA).

According to the robocall agreement, if approved, Chase will pay $10.2 million into a non-reversionary settlement fund, with approximately $45 to $55 to be paid to each of the 2.2 million class members.

Filed by plaintiff Sheila Allen in November 2013, the lawsuit contends JPMorgan Chase and Chase Auto Finance Corp. violated the TCPA by placing approximately 80 calls to Allen’s cellphone from July 2013 through to November 2013.

Allen alleges that the robocalls left voicemails telling her to call back certain numbers to discuss her account, even though she had no auto loan with Chase and never provided her phone number to the bank in connection with any car loan.

Despite Allen contacting Chase repeatedly, requesting the phone calls stop, nothing changed. Further, she contends she was not provided with any instructions on how to opt out of the automated calls, nor was she given the opportunity to opt out.

The case is Sheila Allen v. JP Morgan Chase Bank N.A., case number 1:13-cv-08285 in the U.S. District Court for the Northern District of Illinois.

Hokee Dokee—That’s a wrap folks…See you at the Bar!

Week Adjourned: 5.15.15 – Wells Fargo, JP Morgan Chase, Bar Exam Software

Top Class Action Lawsuits

Wells Fargo playing fast and loose with customer accounts? Maybe…It got hit with a class action lawsuit this week by a former customer who claims that California’s largest bank engages in consumer banking fraud. What does that mean exactly? Well, Shahriar Jabbari of Campbell, CA, alleges that he and a nationwide class of consumers were victims of Wells Fargo’s tolerance and encouragement of abuses by workers in its branches. The specific allegations are unfair enrichment and violations of the federal Fair Credit Reporting Act (FACTA) and California unfair competition and consumer protection laws.

Here’s the back story…according to the lawsuit, Jabbari began banking with Wells Fargo in 2011, wanting simply to open one checking and one savings account. However, shortly after opening his accounts, he allegedly noticed “some anomalies, such as unwanted fees.” Then in 2013, the lawsuit states that Jabbari visited the Wells Fargo branch in Los Gatos to ask about an unauthorized charge. That’s when an employee showed him how accounts had been opened in his name using a signature that was not his, according to the complaint.

The complaint states that Jabbari discovered seven accounts issued without his permission. A few months later, he received a change of address notification showing several accounts that he had not opened and that he thought had been closed.

Jabbari alleged that bill collectors badgered him to pay fees on Wells Fargo accounts that were opened without his knowledge. The suit alleges that bank employees: Withdrew money from customers’ authorized accounts to pay for the fees assessed by Wells Fargo on unauthorized accounts opened in customers’ names without their knowledge; placed customers into collection when fees and other debts accumulated in unauthorized accounts and went unpaid; and placed derogatory information in credit reports when unauthorized fees went unpaid.

The lawsuit, filed in US District Court in San Francisco, seeks restitution from the profits Wells made on “its unfair and unlawful practices,” In addition to triple damages.

Top Settlements

More banking misconduct…this time it’s a win for the plaintiffs…to the tune of $10.2 million—that’s the amount of the settlement agreed between the plaintiffs in a robocall class action lawsuit and JPMorgan Chase Bank NA.

The bank allegedly made unsolicitied robocalls to more than 2 million customers’ cellphones, in violation of the Telephone Consumer protection Act (TCPA).

According to the agreement, if approved, Chase will pay $10.2 million into a non-reversionary settlement fund, with approximately $45 to $55 to be paid to each of the 2.2 million class members.

The case is Sheila Allen v. JP Morgan Chase Bank N.A., case number 1:13-cv-08285 in the U.S. District Court for the Northern District of Illinois.

Law students will be getting some justice it seems after a $2.1 million settlement was reached in a consumer fraud class action lawsuit pending against ExamSoft Worldwide Inc. If the proposed settlement get the final nod, it will resolve allegations that the company failed to adequately respond to glitches reported in its exam software, which prevented state bar applicants from uploading their exam answers.

The defect that triggered the lawsuit is likely ever law student’s nightmare. The target of the lawsuit was SoftTest, currently the only means by which prospective lawyers in dozens of states can take the bar exam electronically. The program failed during last week’s exams, the company acknowledged, and the lawsuit, which contained deceptive marketing and negligence claims, failed to live up to its promises that it would make exam day less stressful.

According to the terms of the agreement each member of the class would receive $90. Class members consist of applicants who took the test in 43 states in July 2014. Tens of thousands of bar exam takers paid between $100 and $150 for a license to use ExamSoft’s software, SofTest, which allegedly failed after the first day of the exam, according to court documents.

Court documents also show that in addition to the $2.1 million payment, ExamSoft has made or is making enhancements to its technology and communications practices that will enable it to better communicate with test-takers and bar examiners.

The case is Amanda West et al. v. ExamSoft Worldwide Inc., case number 1:14-cv-22950, in the U.S. District Court for the Southern District of Florida.

Hokee Dokee—That’s a wrap folks…See you at the Bar!