Class Action Lawsuit

Week Adjourned: 7.22.16 – Apple, Blue Shield, Herbalife

Top Class Action Lawsuits

Bad Apple, Again? Yet another lawsuit against Apple, this one set to take a bite over allegations of consumer fraud surrounding devices that are replaced via AppleCare+ warranty with refurbished replacements that don’t meet a specific clause in the contract.

Filed in California, on behalf of plaintiff Vicky Maldonado and others similarly situated, the proposed class action alleges the clause claiming refurbished devices are “equivalent to new in performance and reliability” is false.

According to the Apple lawsuit allegations, a refurbished device is a “secondhand unit that has been modified to appear to be new” and therefore can’t be equivalent in durability and functionality as a new unit. Maldonado filed the suit after she purchased a third generation iPad and then cracked the screen after owning it for six months.

As the damage to Maldonado’s iPad was accidental in nature, she was forced to replace her tablet at an out of pocket cost of $250, according to the suit. However, she was told that for another $100 the AppleCare+ program would replace the tablet if similarly damaged in the future. Allegedly, the replacement iPad Maldonado was given under the warranty did not function properly and since it had impaired functionality, the tablet wasn’t equivalent to new, the suit asserts.

Following this, in 2013 Maldonado bought another iPad, a fourth generation model. She claims that she wasn’t informed that she would get a refurbished device if she damaged the tablet. When she tried to get a repair for the device in May 2015, she was given a refurbished device instead. According to court filings, she claims the device she received wasn’t equivalent to that of a new device either in performance or reliability.

Policy Policing Needed? Blue Shield got slapped with a consumer fraud class action lawsuit this week, filed by enrollees who allege the insurer owes its members another $35 million in rebates due to errors in its medical-loss ratio calculation of 2014. That’s some accounting error, if true…

Brought by plaintiffs Becky Ebenkamp and Rebecca Morris, the Blue Shield class action lawsuit seeks to represent more than 446,000 individual policy holders from that year.

According to federal law, insurers are required to issue refunds if they don’t spend at least 80 percent of premium dollars on medical care or on improving the quality of care. The complaint alleges Blue Shield improperly counted certain payments as medical expenses it had made erroneously in 2014 to providers who were not in its network and patients whose coverage had lapsed. By counting those mistaken payments as legitimate medical expenses, Blue Shield pushed itself closer to the 80 percent threshold, thus reducing the size of the refunds it owed, according to the complaint.

The lawsuit states that under the consumer refund rule, those payments should have been logged as administrative expenses, and Blue Shield customers are therefore entitled to a bigger refund.

The rebate rule, part of the Affordable Care Act, is intended to contain the cost of health coverage by limiting the share of premiums insurers can spend on administrative functions, executive salaries, overhead and profits. If an insurer spends only 75 percent of premium dollars on care, for example, it must send refund checks to enrollees equal to 5 percent of the premiums they paid.

Who knew? Ah, precisely.

Top Settlements

Herbalife to Pay Up…Remember that old adage, if it sounds too good to be true? Well, Herbalife International of America, Inc., Herbalife International, Inc., and Herbalife, Ltd. have agreed to fully restructure their US business operations and pay $200 million to compensate consumers to settle Federal Trade Commission (FTC) consumer fraud charges that the companies deceived consumers into believing they could earn substantial money selling diet, nutritional supplement, and personal care products.

In its complaint against Herbalife, the FTC also charged that the multi-level marketing company’s compensation structure was unfair because it rewards distributors for recruiting others to join and purchase products in order to advance in the marketing program, rather than in response to actual retail demand for the product, causing substantial economic injury to many of its distributors.

According to the FTC’s complaint, Herbalife claims that people who participate can expect to quit their jobs, earn thousands of dollars a month, make a career-level income, or even get rich. But the truth, as alleged in the FTC complaint, is that the overwhelming majority of distributors who pursue the business opportunity earn little or no money.

For example, as stated in the complaint, the average amount that more than half the distributors known as “sales leaders” received as reward payments from Herbalife was under $300 for 2014. According to a survey Herbalife itself conducted, which is described in the complaint, Nutrition Club owners spent an average of about $8,500 to open a club, and 57 percent of club owners reported making no profit or losing money.

The small minority of distributors who do make a lot of money, according to the complaint, are compensated for recruiting new distributors, regardless of whether those recruits can sell the products they are encouraged to buy from Herbalife.

Finding themselves unable to make money, the FTC’s complaint alleges, Herbalife distributors abandon Herbalife in large numbers. The majority of them stop ordering products within their first year, and nearly half of the entire Herbalife distributor base quits in any given year.

The Herbalife settlement requires Herbalife to revamp its compensation system so that it rewards retail sales to customers and eliminates the incentives in its current system that reward distributors primarily for recruiting. It mandates a new compensation structure in which success depends on whether participants sell Herbalife products, not on whether they buy products.

The settlement also prohibits Herbalife from misrepresenting distributors’ potential or likely earnings. The order specifically prohibits Herbalife from claiming that members can “quit their job” or otherwise enjoy a lavish lifestyle.

In addition, the order imposes a $200 million judgment against Herbalife to provide consumer redress, including money for consumers who purchased large quantities of Herbalife products (such as many Nutrition Club owners, among others) and lost money. Information on the FTC’s redress program will be announced at a later date.

Ok, that’s a wrap folks… See you at the Bar!

Week Adjourned: 7.15.16 – Snapchat, Caterpillar, 21st Century Fox

Top Class Action Lawsuits

Snapchat got Slapped…with a potential consumer fraud and unfair business practices class action lawsuit this week—over allegedly exposing minors to “harmful, offensive, prurient, and sexually offensive” content without warning.

Here’s the skinny: the Snapchat lawsuit was filed by the mother of a 14 year old boy (John Doe), who alleges publishers are sharing content that parents would likely prohibit if they knew their children were being given unrestricted access. The complaint highlights stories like Buzzfeed’s “23 Pictures That Are Too Real If You’ve Ever had Sex With A Penis,” (illustrated with scenes from Disney animated movies) and Vice’s “Everything You Ever Wanted To Know About Penis Tattoos.” Who knew there was such a thing—?

According to the proposed suit, “Innocent pictures from John’s favorite Disney movies were perverted into obscene sexual images and text.” Nice.

Additionally, the offensive content is mixed with messages from Snapchat stating things like, “If They Don’t Snap You On A Daily Basis It Isn’t Real,” according to the complaint.

Snapchat allows users to send photos and videos that disappear. According to the suit, while the app is frequently accused of promoting sexting among teens, parents may not be aware of the explicit content being shared on Discover by media outlets, without any warning or age verification.

“Although Snapchat claims to have pivoted away from its founding roots which included promoting surreptitious ‘sexting’ with disappearing text and images, the content Snapchat develops and curates on Snapchat Discover paints a different and dangerous picture,” the lawsuit states.

Created in 2015, Snapchat Discover was designed as a place where handpicked media outlets could share content. According to the complaint, “Snapchat exercises direct control over its editorial content and what is published.”

The suit alleges that while Snapchat’s terms of service does say that its app is restricted to users older than 13 years old, it does not warn against potential offensive content found on Snapchat Discover.

Top Settlements

Caterpillar Exhaust(ed)…Here’s a beauty. Caterpillar Inc, has reached a preliminary $60 million settlement agreement in a defective products class action lawsuit alleging its engines equipped with exhaust emission control systems failed to work reliably, costing owners thousands.

The lawsuit claimed Caterpillar engines with the CAT Regeneration System (CRS), failed, causing the company’s ACERT C13 and C15 on-highway diesel engines to lose horsepower and shut down. The alleged defect resulted in Caterpillar-authorized dealer technicians having to repair the engines, they allegedly could not effectively do.

The Defendant denies the allegations in the lawsuit, and the Court has not decided who is right.

The Settlement offers payments to current and former owners and lessees of vehicles with EPA 2007 Compliant Caterpillar On Highway C13 and C15 engines (manufactured in 2006, 2007, 2008, and 2009) (“Subject Engines”).

Caterpillar introduced its ACERT engines as their alternative to exhaust-gas recirculation, or EGR, to meet 2004 emissions standards.

Class members who experienced no CRS-related repairs are eligible to receive, but not guaranteed, $500 for each subject engine.

Class members who experienced one to five qualified CRS-related repairs are eligible to receive, but not guaranteed, $5,000 per subject engine.

Those class members who experienced six or more qualified CRS-related repairs are eligible to receive, but not guaranteed, $10,000 per subject engine.

Each eligible class member also has the option—instead of seeking a payment as set forth above—to seek to claim losses up to a maximum of $15,000, experienced as a consequence of qualified CRS-related repairs. These losses can include but will not be limited to towing charges, rental charges and hotel charges. Proofs can include receipts, invoices, bills, etc.

All class members must file a claim in order to receive a payment.

The deadline to exclude yourself from the settlement is August 6, and the deadline to object to the settlement is August 21. The final fairness hearing is scheduled fro September 20, 2016.

Film Studio Interns Win One…Bit of a landmark this week—the employment class action lawsuit filed by interns who worked at 21st Century Fox Inc, and who alleged they should have been paid for their work at the company, but were not, reached a preliminary settlement this week.

According to court papers, Fox Searchlight Pictures and Fox Entertainment Group will pay $495 to each claimant who interned without pay for at least two weeks at various times between 2005 and 2010. Estimates suggest several dozen people are eligible to receive a share of the film studio intern settlement.

The ground breaking lawsuit sparked other, similar suits involving students and recent college graduates who alleged they worked free during their internships when, given their duties, they should have been paid. The lawsuits claim violations of state and federal minimum wage laws.

The two named plaintiffs in the 21st Century Fox class action, Eric Glatt and Alexander Footman, who interned on the 2010 movie “Black Swan,” would be paid a respective $7,500 and $6,000, provided the settlement agreement receives final court approval.

Ok, that’s a wrap folks… See you at the Bar!

Week Adjourned: 7.8.16 – UPS, Home Depot, Cash Store

Top Class Action Lawsuits

UPS not Delivering… on reporting pay, allegedly. The global courier service got hit with a UPS employment class action lawsuit this week, alleging the company cheated employees out of their rightful wages by failing to pay “Reporting Pay,” as required by Massachusetts law.

Cort Szafarz, the named plaintiff in the lawsuit, worked as a part-time package handler at UPS from September 2014 to May 2015 in their Chelmsford, Massachusetts facility. He was scheduled to work Monday through Friday from 6pm to 11pm. Although he planned to work for the full shift every weekday, and showed up at the Chelmsford facility every weekday ready to do so, his shift was often cancelled or shortened due to a lack of work. On such days, Mr. Szafarz and others were not paid for at least three hours of work. When Mr. Szafarz complained to Human Resources, he was told, “That’s just the way we do it here.”

Massachusetts, like many other states, requires employers to pay employees who show up for their scheduled shift, but are sent home due to a lack of work. This “Reporting Pay” law, as it is known, requires employers in Massachusetts to pay an employee for at least three hours of work, at the minimum wage, for every shift cancelled or shortened after an employee’s arrival at the job site.

Mr. Szafarz seeks to represent a class of other UPS hourly employees in Massachusetts who, like him, were not paid appropriately when their shifts were cancelled or shortened.

Giddy up!

They can Help? Maybe not at Home Depot… Consumer fraud class action against Home Depot hoping for a home run. This week the DIY giant found itself on the end of a consumer fraud class action lawsuit over allegations it failed to provide services and products as agreed.

To narrow that down just a bit, the Home Depot lawsuit, filed by plaintiff Ellen Coffen of California, claims that Coffen purchased new cabinets from the defendant for $12,000 with a $3,000 installation fee and additional $50 fee.

But… the cabinets Coffen purchased didn’t fit in the space designated for the kitchen installation, despite the fact that Home Depot installers had measured the space prior to their installation. Coffen claims that as a result, she had to return the cabinets to the defendant. Further, she had to pay for the second round of installation and the second set of new cabinets. Coffen asserts that the defendant allegedly failed to perform its duties and offer resolution when this issue arose.

Coffen states in the suit that Home Depot is in fact responsible as the DIY store allegedly assured her that they obtained the right measurement of the space to accommodate the cabinets that she purchased and that the cabinets were to be installed as part of their agreement.

The lawsuit cites alleged fraud and deceit, negligent infliction of emotional distress, breach of the implied covenant of good faith and fair dealing, breach of express and implied warranties, false advertising, violation of the Magnuson-Moss Warranty Act and unfair business practices.

The case is US District Court for the Northern District of California, San Francisco Division Case number 3:16-cv-03302-MEJ.

Top Settlements

Meanwhile—back in Canada…Cash Store and Instaloans may need to borrow some dough. They have to pony up $10 million in settlement of a consumer fraud class action pending against the now defunct business. Class members in Ontario who took out loans, also called lines of credit, will now be able to collect their share of the settlement.

The lawsuit, which represents some 100,000 customers, alleged that Cash Store Financial Services Inc., broke the Payday Loans Act by exceeding the maximum cost of borrowing allowed. According to Ontario law, it is illegal for payday lenders to charge more than $21 on every $100 lent. The plaintiffs claims that the defendant skirted the rules around maximum interest rates by adding additional fees for setting up debit cards, bank accounts, and other products.

At its peak, the Cash Store Financial Services Inc, had 500 outlets at its peak.

Ontarians who took out payday loans, or so-called lines of credit from either Cash Store or Instaloans after September 1, 2011 are being asked to file claims to recover some of the illegal fees and interest they were charged.

Eligible class members with approved claims could receive at least $50, with some, including those who took out multiple loans, possibly receiving more. The final amounts will depend on how many claims are submitted. Timothy Yeoman filed the lawsuit was filed in 2012 alleging he borrowed $400 for nine days and was charged $68.60 in fees and service charges as well as $78.72 in interest, bringing his total borrowing cost to $147.32.

Cha Ching!!

Ok, that’s a wrap folks… See you at the Bar!

Week Adjourned: 7.1.16 – Pampers, Volkswagen, Wells Fargo SPAM

Top Class Action Lawsuits

Pampers Not So Pampering? The makers of Pampers Natural Clean baby wipes, Procter and Gamble (P&G), got hit with a consumer fraud class action complaint this week, over allegations its advertising ain’t clean.

Filed by Veronica Brenner, on behalf of all others similarly situated, the proposed Pampers wipes class action lawsuit claims that due to the false claims made by P&G, Brenner was misled into buying Pampers Natural Clean baby wipes.

Specifically, she alleges that testing of the wipes revealed they contain unnatural and harmful ingredients such as phenoxyethanol, which allegedly could cause harm to consumers, especially infants.

Brenner is seeking a jury trial and is seeking compensatory, statutory, and punitive damages, injunctive relief enjoining the defendant, interest, restitution and any other forms of monetary relief, court costs and any further relief the court grants.

The case is US District Court for the Central District of California Case number 8:16-cv-01093-CJC-JCG.

Top Settlements

VW To Pay…So, by now almost everyone must be aware that Volkswagen (VW) has reached agreements with the United States and the State of California, and the U.S. Federal Trade Commission (FTC), that will see it stump up $14.7 billion—the largest such payout of its type in US history—to end consumer fraud allegations over the now infamous VW emissions scandal.

Now, just to be clear, the settlements do not resolve pending claims for civil penalties or any claims concerning 3.0 liter diesel vehicles. Nor do they address any potential criminal liability. So stay tuned on that front.

The information on the settlements is provided more comprehensively on our dedicated Volkswagen emissions settlements page—BUT the super short versions are that VW will offer consumers a buyback and lease termination for nearly 500,000 model year 2009-2015 2.0 liter diesel vehicles sold or leased in the US, and spend up to $10.03 billion to compensate consumers under the program. In addition, the companies will spend $4.7 billion to mitigate the pollution from these cars and invest in green vehicle technology.

Additionally, the settlements partially resolve allegations by the Environmental Protection Agency (EPA), as well as the California Attorney General’s Office and the California Air Resources Board (CARB) under the Clean Air Act, California Health and Safety Code, and California’s Unfair Competition Laws, relating to the vehicles’ use of “defeat devices” to cheat emissions tests. The settlements also resolve claims by the FTC that Volkswagen violated the FTC Act through the deceptive and unfair advertising and sale of its “clean diesel” vehicles.

The affected vehicles include 2009 through 2015 Volkswagen TDI diesel models of Jettas, Passats, Golfs and Beetles as well as the TDI Audi A3.

The Buyback option: Volkswagen must offer to buy back any affected 2.0 liter vehicle at their retail value as of September 2015 — just prior to the public disclosure of the emissions issue. Consumers who choose the buyback option will receive between $12,500 and $44,000, depending on their car’s model, year, mileage, and trim of the car, as well as the region of the country where it was purchased. In addition, because a straight buyback will not fully compensate consumers who owe more than their car is worth due to rapid depreciation, the FTC order provides these consumers with an option to have their loans forgiven by Volkswagen. Consumers who have third party loans have the option of having Volkswagen pay off those loans, up to 130 percent of the amount a consumer would be entitled to under the buyback (e.g., if the consumer is entitled to a $20,000 buyback, VW would pay off his/her loans up to a cap of $26,000).

The EPA-approved modification to vehicle emissions system: The settlements also allow Volkswagen to apply to EPA and CARB for approval of an emissions modification on the affected vehicles, and, if approved, to offer consumers the option of keeping their cars and having them modified to comply with emissions standards. Under this option in accordance with the FTC order, consumers would also receive money from Volkswagen to redress the harm caused by VW’s deceptive advertising.

Consumers who leased the affected cars will have the option of terminating their leases (with no termination fee) or having their vehicles modified if a modification becomes available. In either case, under the FTC order, these consumers also will receive additional compensation from Volkswagen for the harm caused by VW’s deceptive advertising. Consumers who sold their TDI vehicles after the VW defeat device issue became public may be eligible for partial compensation, which will be split between them and the consumers who purchased the cars from them as set forth in the FTC order.

Wells Fargo SPAM Settlement… Another settlement to report this week—on the spam text messaging front. Wells Fargo Bank, N.A. (Wells) has agreed to a preliminary $16.3 million settlement to end claims it made unauthorized calls to customers’ cell phones using an Automatic Telephone Dialing System (ATDS), in violation of the Telephone Consumer protection Act (TCPA).

The lawsuit, originally filed on April 14, 2015, alleged that the calls at issue were, without exception, non-emergency, debt-collection calls and texts made in connection with Home Equity Loans and Residential Mortgage Loans.

Under the terms of the proposed settlement, Wells would pay a non-reversionary cash sum of approximately $16,319,000, which, after deductions for costs and attorney’s fees, would be distributed on a pro rata basis to the Class Members who file qualified claims. The expected per-class-member cash award, while dependent upon the number of claims, may be in the range of $25 to $75.

The proposed Settlement Class is defined as: All users or subscribers to a wireless or cellular service within the United States who used or subscribed to a phone number to which Wells made or initiated one or more Calls during the Class Period using any automated dialing technology or artificial or prerecorded voice technology, according to Wells available records, and who are within Subclass One and/or Two.

Subclass One consists of “persons who used or subscribed to a cellular phone number to which Wells Fargo made or initiated a Call or Calls in connection with a Residential Mortgage Loan.”

Subclass Two consists of “persons who used or subscribed to a cellular phone number to which Wells Fargo made or initiated a Call or Calls in connection with a Home Equity Loan.”

Heads Up—a person who is a member of both Subclasses is eligible to make two claims on the Settlement Fund. The three Class Representatives are seeking awards for their time and effort on behalf of the Class, and Wells has agreed not to object to such incentive payments to be paid to Davis, Markos, and Page from the Settlement Fund provided that the payments do not exceed $60,000 in the aggregate or $20,000 for each Class Representative, subject to Court approval.

The case is Markos v. Well Fargo Bank, N.A. (United States District Court for the Northern District of Georgia, Case No. 1:15-CV-01156).

Ok, that’s a wrap folks… Happy Canada Day and Fourth of July…. See you at the Bar!

Week Adjourned: 6/24/16 – TD Bank, Banana Boat, Whirlpool

Top Class Action Lawsuits

Canadians are Following Suit…literally, this week, by filing a consumer fraud class action lawsuit against Toronto Dominion (TD) Bank in Canada alleging that its “Penny Arcade” coin counting machines located across Canada shortchanged customers. The bank has faced lawsuits in the state over the very same issue.

Short version: Plaintiff Lisa Ram (“Ram”), claims that on or about June 23, 2014, she used TD Bank’s coin counting machine in Kitchener, Ontario to count coin currency. Before taking them for deposit in the machine, Ram claims she counted and sorted them and knew she had a total of $854.25. After depositing the coins into TD Bank’s coin counter, she was not credited for amounts totaling $159.50. Despite complaining to the bank, Ram claims it failed to remedy her losses. So, who’s making money here?

According to the TD Bank complaint, customers using TD Bank’s coin counting machines expected the machines to operate accurately. However, based on its extensive experience with operating coin counting machines in its US branches since 2007, TD Bank knew or ought to have known that its coin counting machines were not capable of achieving accuracy for many reasons, resulting in undercounted funds of several percentage points in some cases. TD Bank failed to take any steps to warn customers of these risks, causing them harm.

Heads up Canadians—the class action is brought on behalf of a proposed class of persons who used TD Bank’s coin changing machines in Canada between January 1, 2013 and May 25, 2016.

Limited Protection? Meanwhile, back in the US, Banana Boat got hit with a consumer fraud class action lawsuit alleging its sunscreen products do not contain the amount of sunscreen advertised. That is not cool.

According to plaintiff Paul Lambrakis, he bought tube of Banana Boat Kids SPF 50 in May after a Consumer Reports study found that it and many other sunscreens were overstating their protection factor. Lambrakis then sent the tube to a laboratory in Winston Salem, NC for testing, according to the lawsuit. The results showed that while the product stated it was SPF 50, it turned out to have less than half the sunscreen stated on the packaging.

The investigation concluded that Banana Boat Kids SPF 50 sunscreen, clearly labeled as containing SPF 50, shockingly contained only an SPF of 12.69 and a measured UVA protection factor of 4.88,” according to the lawsuit.

“Defendants have known, or should have known, for years that Banana Boat Kids SPF 50 products contain less UV protection than Defendants advertise,” the lawsuit states. Defendants named in the suit are Playtex Products, Edgewell Personal Care Company and Sun Pharmaceutical.

According to the complaint, Lambrakis and others in the class action suit were forced to “overpay for the sunscreen based upon false, inflated SPF.”

The lawsuit comes after a Consumer Reports investigation found that 43 percent of the more than 60 sunscreens they tested failed to measure up to the SPF claims advertised on their bottles.

“In May of 2016, Consumer Reports research revealed that among ‘the most problematic products were Banana Boat Kids Tear-Free, Sting-Free Lotion…which [was] labeled as SPF 50 but [was] found to have only SPF 8,’” according to the complaint.

Did you buy and fry with Banana Boat sunscreens?

Top Settlements

Whirlpool Washers finally Settle… Finally! Remember those moldy front loading washing machine lawsuits? Well—a settlement was reached this week, with defendants (“Whirlpool”) and Sears, Roebuck and Co. (“Sears”).

So, if you purchased or owned a front-loading washing machine manufactured by Whirlpool, you may be entitled to cash or other compensation from a class action settlement.

Quick back story—the lawsuits alleged certain front-loading washing machines manufactured between 2001 and 2010 fail to self-clean and tend to accumulate bacteria and mold, resulting in bad odors and ruined laundry. Specifically, the lawsuit cites certain Whirlpool, Maytag or Kenmore front-loading washing machine that were manufactured by Whirlpool and are referred to as the “Class Washers”.

The Settlement Class includes all residents of the United States and its territories who either: (a) purchased a new Class Washer; (b) acquired a Class Washer as part of the purchase or remodel of a home; or (c), received a new Class Washer as a gift.

If you are included in the Settlement, you may qualify for one of a variety of benefits including a cash payment, a rebate on the purchase of a new washing machine or dryer, or reimbursement for out-of-pocket expenses incurred due to past mold or odor problems in your washing machine.

In order to claim a Sears or Whirlpool settlement benefit, if you are qualified, you must complete and submit a Claim Form, including required documentation October 11, 2016.

Better go find those receipts!

Ok, that’s a wrap folks…Have a good one. See you at the Bar!

Week Adjourned: PetMatrix, Shop-Vac, HSBC

Top Class Action Lawsuits

Heads Up Dog Owners…Dog food manufacturer PetMatrix LC got hit with a consumer fraud class action over claims its dog treats could pose a health hazard for animals.

According to Charlotte Docken of California, who filed the proposed class action, her dog required surgery to clear an abdominal obstruction, allegedly after consuming one of the defendant’s treats.

Docken claims that advertising for the PetMatrix Dream Bone dog treats state that the products do not contain any rawhide but do contain 99 percent digestible ingredients. However, Docken claims the treats do contain a large amount of partially or completely indigestible ingredients, allegedly with the full knowledge of PetMatrix. So not cool.

The case is US District Court for the Central District of California Case number 8:16-cv-00994.

Top Settlements

Shop-Vac Settlement on the Way…A proposed settlement has been reached in a consumer fraud class action lawsuit (In re: Shop-Vac Marketing and Sales Practices Litigation, MDL No. 2380) about certain advertising related to Shop-Vac® brand wet/dry vacuums (the “Vacuums”).

In the class action, the plaintiffs allege that defendants Shop-Vac Corporation and Lowe’s Home Centers, LLC misrepresented the peak horsepower ratings and tank capacity of the Vacuums. Defendants deny these allegations.

Under the terms of the proposed Shop-Vac agreement, the manufacturers would extend their warranty on the motors of the Vacuums for at least 2 years. The proposed Settlement also includes changes to the descriptions of peak horsepower ratings and tank capacity on marketing materials.

The “Settlement Class Members” are defined as each person in the United States and its territories who, from January 1, 2006 to May 26, 2016, either (1) purchased a Vacuum, or (2) received a Vacuum as a gift, or (3) acquired possession of a Vacuum through other lawful means, other than for resale or distribution.

Settlement Class Members do not need to do anything in order to qualify for the settlement benefits. The manufacturer’s warranty extension will automatically apply and the changes to the peak horsepower ratings and tank capacity descriptions will be made.

HSBC Gets Slammed. Here’s a whopper—almost 15 years in the making! HSBC has agreed to pony up a massive $1.575 billion settlement ending a securities class action lawsuit pending against a unit of HSBC Holdings Plc (HSBA.L). The 14-year old lawsuit stems from the Household International consumer finance business that the British bank bought in 2003 for $14.2 billion.

The settlement agreement effectively avoids a second trial, scheduled to begin last week in the Chicago.

The lawsuit (Jaffe et al v Household International Inc et al, U.S. District Court, Northern District of Illinois, No. 02-05893), was filed in 2002, by shareholders who alleged the company inflated its share price by concealing its poor lending practices and loan quality. The HSBC share price fell more than 50 percent between mid-2001 to October 2002, when the defendant agreed to pay $484 million to settle predatory lending claims brought by US state regulators.

By March 2009, HSBC shut down much of its US consumer finance business having taken tens of billions of dollars of write downs for bad loans associated with its subsidiary.

Ok, that’s a wrap folks…Have a good one. See you at the Bar!

Week Adjourned: 6.10.16 – Auto-Renewals, Domino’s, Luminosity

Top Class Action Lawsuits

Auto-Renewals on Auto-Pilot: Not Cool… Hey—about that auto-renewal—you know the Appgrinders one you didn’t sign up for? This week the California-based software company found itself facing allegations of unfair business practices in a class action lawsuit over unauthorized charges to its customers’ credit cards for auto-renew subscriptions to its products.

Specifically, the Appgrinders lawsuit, filed by Jarrod Secola, claims that Secola and others purchased access to online PDF editing software (PDF Buddy) from Appgrinders without being made aware of the firm’s auto-renew policies. Yeah—know that one.

The complaint further claims that Appgrinders not only failed to satisfy the law by providing clear, conspicuous disclosures about the subscription’s auto-renewal policy, but also neglected to obtain the purchaser’s consent before the auto-renewal charges were placed.

The case is US District Court for the Eastern District of California Case number 2:16-cv-01150-JAM-KJN.

Domino’s Pizza Delivers…Unpaid Wages? Domino’s found itself on the end of yet another employment lawsuit this week. This one, however, was filed by New York Attorney General Eric T. Schneiderman. The AG’s office is alleging the pizza chain is deliberately underpaying it workers at least $565,000 at 10 stores in New York and is in violation of New York employment law…Whooo Hooo!

The lawsuit names Domino’s Pizza Inc., Domino’s Pizza LLC and Domino’s Pizza Franchising LLC (collectively, Domino’s), as defendants and claims to have discovered that Domino’s headquarters was intensely involved in store operations, and even caused many of the employment violations. Therefore, they should be liable for underpaid wages at franchises.

Domino’s, BTW, is no stranger to employment lawsuits. It found itself the named defendant in a California employment violations class action– filed May 12.

In fact the company has a lengthy list of lawsuits against it, including unpaid overtime, TCPA violations and spam text messaging.

FYI—Schneiderman is seeking a finding that Domino’s is a joint employer, an accounting to determine full restitution amount owed to employees, a finding that Domino’s defrauded its franchises and therefore violated state franchise law, and the placement of a monitor that will ensure future compliance.

Top Settlements

Here’s Something to Get your Brain Boing—remember Luminosity—the “brain training” program? Well, the Federal Trade Commission (FTC) caught up with them recently, and hit them with a $2 million settlement over allegations the company deceived its consumers with unfounded claims that its games can help users perform better at work and in school, and reduce or delay cognitive impairment associated with age and other serious health conditions. Wow. Wonder if it takes the garbage out? (literally and figuratively).

Specifically, the FTC charged the company with making claims that were not supported by science, including claims that using Luminosity (get ready for this): improves performance in school, work, and athletics; delays age-related mental decline and protects against dementia and Alzheimer’s disease; helps those with ADHD, PTSD, Traumatic Brain Injury, and other health conditions. If it sounds too good to be true….

As part of the Luminosity settlement, Lumos Labs, the company behind Luminosity, will pay $2 million in redress and will notify subscribers of the FTC action and provide them with an easy way to cancel their auto-renewal to avoid future billing.

Eligible Luminosity subscribers were notified by email. You were eligible for a refund if you signed up between Jan 1, 2009, and December 31, 2014, and spent at least $239 total on your subscription.

Ok, that’s a wrap folks…Have a good one. See you at the Bar!

Week Adjourned: 6.3.16 – Baby Powder, Uber, Ticketmaster

Top Class Action Lawsuits

More Talc Powder Lawsuits…We’ve been seeing a lot about the Johnson & Johnson (J&J) talcum powder ovarian cancer lawsuits here in the US, but a class action lawsuit has now been filed in Canada against J&J alleging its Baby Powder product causes ovarian cancer.

The named plaintiffs in the Canadian J&J talc complaint all developed ovarian cancer following long-term use of J&J’s Baby Powder for feminine hygiene purposes. The representative plaintiffs in this case include, Marilyne Bernier who is the daughter of Thérèse Bernier, who died in March of this year following her battle with ovarian cancer, and Shaeda Farooqi of Mississauga.

According to the complaint, scientific researchers have established that over time, applying talcum powder to genitals, underwear, and sanitary napkins increases the risk of developing ovarian cancer by 33%. However, despite the evidence of a direct link, J&J has not acknowledged the connection and has kept its product on the shelves without warning.

The lawsuit aims to bring access to justice to the many women who have developed ovarian cancer due to long term use of Baby Powder and to modify behaviour of companies that place known carcinogens into the stream of the Canadian commerce without warning.

FYI—estimates suggest there are over 1,000 talc-powder induced ovarian cancer lawsuits pending in the US against J&J.

Uber Needs to Check the Definition of Stop? Wow—Uber just cannot stay out of trouble, it seems. It found itself on the end of another proposed class action recently, this one alleging violations of the Telephone Consumer Protection Act (TCPA). The allegations? Uber sent text messages through an auto-dialer to people even after they had opted out of the messages by texting back “Stop”.

Filed by an Uber driver applicant, the lawsuit alleges the plaintiff provided his telephone number during the application process, which he did not complete. However, Uber then purportedly began sending him text messages asking him if he required help finishing his application.

According to the Uber lawsuit, the plaintiff replied to Uber, stating “stop” on numerous occasions because Uber’s automated system responded to these “stop” requests with a confirmation text stating “SMS from Uber is now disabled. To re-enable, reply START.”

Further, the lawsuit asserts after the plaintiff deleted his Uber rider account, Uber sent him another text message confirming he had deleted his account.

Top Settlements

Heads Up Ticketmaster Account Holders: The more than 10-year long consumer fraud class action lawsuit filed against Ticketmaster, Schlesinger v. Ticketmaster, has reached a $400 million settlement, which involves providing ticket vouchers as restitution to Class members —oh what a surprise.

Here’s the skinny: On or around June 18, 2016, class members should receive at least one Ticket Code by email redeemable for two tickets for General Admission seating at designated concert events at Live Nation owned or operated venues, subject to availability and limitations.

The Class includes all consumers who (1) purchased tickets on Ticketmaster’s website (“Website”) from October 21, 1999 through February 27, 2013; (2) paid money to Ticketmaster for an OPF that was not fully refunded; (3) did not and do not opt out of the Class; and (4) were residents of one of the fifty United States at the time of their purchase, including persons who placed, and then cancelled, a ticket order without obtaining a full refund of the OPF. If you also purchased UPS delivery for your tickets, then you are also a member of the “UPS Subclass.”

Certain people are excluded from the Class. They are (a) Ticketmaster, (b) any entities in which Ticketmaster has a controlling interest or which have a controlling interest in Ticketmaster, (c) the officers, directors, employees, affiliates, and attorneys of Ticketmaster, or (d) any employee or officer of the Court or their immediate family members.

For more information on the settlement and a list of guidelines regarding using your Ticket Code(s), please visit the official Settlement Website.

It would seem that Ticketmaster has mastered the class action settlement.

Ok, that’s a wrap folks…Have a good weekend. See you at the Bar!

Week Adjourned: 5.27.16 – Ruby Tuesday, Kmart, Blue Buffalo

Top Class Action Lawsuits

Ruby Tuesday Not Serving Up Overtime Pay? Employment—of the largely unpaid variety—was a bit of a theme song this week. Among the chorus is an unpaid overtime class action filed against the Ruby Tuesday national restaurant chain by two former employees who allege they were denied overtime pay.

Specifically, Oscar Sagastume of Meriden and Kevin Gibson of New York filed the lawsuit in U.S. District Court on May 19 to “recover unpaid overtime compensation for themselves and similarly situated employees as a collective action under the Fair Labor Standards Act (FLSA). Additionally, Sagastume and any other Connecticut plaintiffs also assert violations of the Connecticut Minimum Wage Act.

The Ruby Tuesday lawsuit states that the former Ruby Tuesday employees worked many 50-hour or more weeks without proper compensation. “Defendant was aware that plaintiffs and the class members worked more than 40 hours per workweek, yet defendant failed to pay overtime compensation for hours worked over 40 hours in a workweek,” the lawsuit alleges. “Defendant did not keep accurate records of hours worked by the plaintiffs or the class members.”

In the complaint, Sagastume claims he worked for the national restaurant chain from February 2011 to April 2015. He worked at several locations across Connecticut as an assistant manager and frequently worked more than 40 hours a week.During the week of February 8, 2015, he worked “approximately 60 hours” but was only paid for 40. He claims that on average he worked between 57 and 62 hours per week.

“Ruby Tuesday required plaintiffs and [assistant managers] to work long overtime hours without paying them any overtime compensation,” the complaint states. “Ruby Tuesday classified all of its (assistant managers) as ‘executives’ and treated them as exempt from the overtime requirements of federal and state laws.”

Further, the lawsuit states that while assistant managers earned about $37,500 annually, job duties for both Sagastume and Gibson required them to do the same as the hourly employees, who were given overtime pay, such as greeting and waiting on customers, serving food, cooking and preparing food, clearing and setting tables and cleaning the restaurant.

The suit claims Ruby Tuesday willfully misclassified Sagastume, Gibson and other assistant managers as employees who are exempt from FLSA protection and failed to properly record the hours worked by their employees. “Defendant’s unlawful conduct has been widespread, repeated and consistent,” the lawsuit alleges.

Heads up—the lawsuit is looking to represent others similarly situated including managers, such as those running the kitchen and guest services, and for the Connecticut class action allegations, any assistant manager who worked in Connecticut from May 19, 2014, to the date of final judgment, if one is given.

Top Settlements

Kmart Got a Damage Bill this week to the tune of $3.8 million. No stranger to employment lawsuits, the discount retailer agreed to settle this latest, effectively ending two collective actions brought on behalf of assistant managers who allege they were wrongly classified as exempt from overtime pay, in violation of the Fair Labor Standards Act (FLSA) and state labor laws.

What’s the betting the FLSA is one of most frequently cited pieces of law in class actions today…

The class is estimated to include some 422 people, with each plaintiff receiving roughly $9,000, depending on how long they worked for the company. Additionally, it provides $7,500 for each of the four named plaintiffs.

The Kmart settlement motion seeks preliminary certification of the class and scheduling of a final approval and fairness hearing. The settlement would encompass a suit filed in the U.S. District Court for the District of New Jersey, Fischer v. Kmart, and another in the Western District of New York, Hautur v. Kmart.

While unhappy class members will have the opportunity to opt out of the settlement, if the unhappiness total reaches more than 5 percent of class members, will have the opportunity to terminate the settlement, according to court documents. And everyone’s a winner…

And now for something completely different…

Blue Buffalo Pet Food Settlement…A $32 million settlement has been approved in a consumer fraud class action lawsuit pending against Connecticut-based Blue Buffalo, a well known maker of “natural” pet food—whatever that means—which was the subject of the lawsuit.

The class actions, brought by consumers in several lawsuits across and country and which were consolidated into Multi District Litigation in 2014, alleged that certain Blue Buffalo products were not consistent with its “True Blue Promise.” The label indicates the products contain no chicken by-product, along with no corn, wheat, soy or artificial flavors, colors or preservatives. However, this, consumers claimed, was not the case, stating they paid a premium for the pet food products, but were misled. A total of 13 class actions were brought against Blue Buffalo over its alleged false advertising.

The Blue Buffalo settlement, originally reached in December 2015, will provide customers who filed a claim but couldn’t provide a receipt, with up to $100. Customers who filed a claim and have receipts will receive up to $2,000.

Full details available at – https://www.petfoodsettlement.com/.

According to Blue Buffalo, they are not guilty of any wrong doing, stating that it was defrauded by a supplier that provided its chicken byproduct.

Ok, that’s a wrap folks…Have a good long weekend. See you at the Bar!

Week Adjourned: 5.20.16 – Uber, BMW, Hip Implants

Top Class Action Lawsuits

Dueling Rides… An unfair business practices class action lawsuit has been filed by the ride share company Lyft against its rival company Uber, alleging Uber creates and uses shell accounts to hurt business for Lyft. Yeah, that sounds pretty unfair, if true.

Lyft driver Ryan Smythe and “others similarly situated”, filed the Uber class action complaint against Uber Technologies Inc, and 100 unnamed entities said to exist as “mere shells and conduits” for Uber’s affairs.

Here’s the skinny: according to the complaint, Mr. Smythe started as a Lyft driver in September 2014, one month after accusations began concerning “Operation SLOG,” an alleged Uber-sponsored campaign that involved spamming Lyft drivers with false ride requests in an effort to negatively impact Lyft’s business.

This allegedly involved Uber creating dummy Lyft accounts with prepaid cellphones and credit cards which were then used to place fake requests with Lyft drivers. According to the lawsuit, Uber’s alleged operation amounted to unfair business practices under California law as well as intentional interference with prospective economic advantage.

The complaint asserts that Uber engaged in a “systematic course of creating fraudulent Lyft accounts from which sham orders were placed, at least in part to deprive Class members from earning income in violation of California Business and Professions Code which prohibits unfair business practice.”

Further, Smythe claims in the proposed class action that Uber directed its drivers and third-party companies to make these requests “for the sole purpose of luring Lyft drivers to locations in which a false request for service directed them.” So much for “just making a living.”

“Uber Technologies did this to discourage Lyft drivers from contracting with Lyft, to deprive the marketplace of Lyft drivers so that Uber drivers could benefit and to create a higher wait time for Lyft customers in order to steer their patronage to Uber Technologies in violation of California Business and Professions Code,” the complaint states.

75 to 45 in 2 Seconds? This sounds just a tad dangerous. BMW got hit with a nationwide defective automotive class action lawsuit for alleged defects in the electric BMW i3 vehicles—defects which cause the vehicle to rapidly drop speed. Read on.

The BMW lawsuit centers around the BMW i3 “Range Extender” feature. This option, called REx, outfits the vehicle with a two-cylinder gasoline engine producing 34 horsepower that switches on when the battery charge depletes to five percent, giving the vehicle another 70 miles of range. BMW claims that the Range Extender “doubles your electric driving range” from the vehicle’s standard 81-mile range.

However, the lawsuit alleges that in practice, when the gasoline engine kicks in, it doesn’t produce enough power to prevent a dramatic decrease in the vehicle’s performance. As alleged, if the car is under any kind of significant load (such as going up a hill, or loaded with passengers), the speed of the car will dramatically decrease as the battery charge diminishes. According to the complaint, this can result in the car slowing to speeds of 45 miles per hour on the freeway, without warning. This sudden and unexpected loss of power in a motor vehicle can result in a catastrophic situation for all those on the road. Yes, no—not a good thing at all.

The lawsuit seeks to have the vehicles redesigned and repaired at BMW’s expense, and to halt the sale of all i3 vehicles until repairs can be made. The claim also seeks compensation for all the owners of the vehicles, who were not told of the serious safety defect.

The case Edo Tsoar v. BMW North America, LLC (Case No. 2:16-cv-03386) was filed in U.S. District Court in Los Angeles.

Top Settlements

Hip Settlement in Canada. Some news from north of the Border—two Canadian class actions have been certified—one in British Columbia (Jones v. Zimmer) and another in Ontario (McSherry v. Zimmer). Authorization (Certification) is pending in a proposed class action filed in Quebec (Major v. Zimmer), and the parties have consented to authorization (certification) of that action.

Translation? Settlement. Yup—subject to court approval, the hip implant settlement applies to “all persons who were implanted with the Durom Cup in Canada” and their estates and family members. Nice one.

No dollar figures to report, and of course, the defendants to the three actions do not admit liability, but have agreed to a settlement providing compensation to class members with certain injuries upon approval after receipt of supporting documentation, less deductions for legal fees.

FYI—Public health insurers are also entitled to compensation under the settlement agreement.

Motions to approve the settlement agreement will be heard in Vancouver on June 28, 2016, Ontario on July 14, 2016, and in Montreal on June 28, 2016.

Ok…that’s a wrap folks! Have a good one–and see you at the Bar!