JP Morgan Chase

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: 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!

Week Adjourned: 4.4.15 – Toyota Camry, Babies R Us, JP Morgan Chase

Top Class Action Lawsuits

Heads up Toyota Camry owners! The car maker is facing a defective products class action lawsuit alleging the car maker was aware of a defect in its Camry models that causes the cars’ air conditioning system to become moldy, emitting foul odors and potentially causing health problems.

Filed in Los Angeles earlier this week, the Toyota Camry lawsuit claims that Toyota’s 2012 Camry models have a “uniform and widespread defect” in the heating, ventilating and air conditioning systems that causes emissions of noxious and foul odors from the growth of mold in the system.

“Defendant has actively concealed and failed to disclose this defect to plaintiff and class members at the time of their purchase or lease of the class vehicles and thereafter,” the complaint states.

Further, the lawsuit contends that the affected Camry models’ HVAC system contains one or more design or manufacturing defect that causes the emissions of the bad odors from the mold. The plaintiffs allege that exposure to mold and its related smells is “extremely dangerous” and can lead to sickness, nasal stuffiness, eye irritation, wheezing and other health problems. Well, if it smells bad, it can’t be good for you, right?

The mold emanating from the HVAC system in the 2012 Toyota Camry vehicles allegedly grows on a part known as the evaporator, which is located inside the car dashboard. When cold refrigerant passes into the evaporator, it absorbs heat from the air in the passenger compartment and collects moisture from condensation, which creates a favorable growing condition for mold, the complaint claims.

When a consumer complains of the mold build-up in his or her Camry, Toyota “merely replaces” the defective HVAC components with the very same components, and doesn’t repair the defect, in violation of warranty, according to the lawsuit.

According to the plaintiffs, Toyota knew, or should have known, about the defect as early as 1997. However, the automaker “actively concealed” the defect and didn’t inform consumers.

Further, the complaint states that Toyota had “already offered” previous model year Camry vehicles that had similar HVAC systems and acknowledged the defects as early as 1997 and as recently as 2009.

The complaint seeks certification of a class of California purchasers of 2012 Camry vehicles.

Who’s really reaping the rewards here? Babies “R” Us, according to a consumer fraud class action lawsuit over allegations its rewards program was misleading and misrepresented what consumers actually receive when purchasing items from the retailer.

Filed by Stacy Tongate, the Babies R Us lawsuit claims that the Endless Earnings program promoted and run by Babies “R” Us offers shoppers up to 10 percent back on registry items purchased. The program, the lawsuit contends , is run in order to attract more customers to use the baby registry services.

According to the complaint, the popular children’s toy store launched the program in April 2014, offering benefits with no limits. However, The company in fact offers five percent of the first $300 spent by consumers. After the first $300, consumers are bumped up to 10 percent, Tongate claims.

The lawsuit is seeking class status for those who made purchases during the Endless Earnings program’s duration.

Top Settlements

JPMorgan Chase has agreed to pony up $950,000 …according to the terms of a preliminary settlement agreement reached in a California labor law class action lawsuit.The lawsuit was filed by the company’s California underwriters who alleged the bank failed to pay overtime and provide proper breaks. No comment.

The proposed agreement potentially ends the three-year-old lawsuit, which was filed by two loan modification underwriters who worked at a Chase location north of San Diego. They alleged the bank was in violation of federal and state labor laws and that they suffered from overwhelming workload requirements. Filed in 2012, by plaintiffs Mary Loeza and Angie Reveles, the suit claims that Chase saddled its underwriters with unrealistic quotas for processing mortgage loan modification applications that they could not achieve without working overtime.

The plaintiffs further claimed that Chase had a strict policy on approval of overtime and would punish employees who worked it without authorization, leaving employees to work off-the-clock and through meal breaks and rest periods to meet the elevated quota, according to the settlement agreement.

“Based on their knowledge of this action, plaintiffs determined that the settlement would constitute the best outcome for class members,” court documents state. “Likewise, Chase concluded that this action should be settled in order to avoid the expense, inconvenience and burden of further legal proceedings, and the uncertainties of trial and appeal.”

The proposed class consists of approximately 838 current and former Chase employees who worked at the bank between December 11, 2008, and the date the judge preliminarily approves the agreement. If certified, the settlement will see each class member receive a share of the settlement funds, fees and expenses are paid.

Hokee Dokee—That’s a wrap folks… Happy Easter! Go celebrate!

Week Adjourned: 1.10.14 – Target Data Breach, Carfax, JP Morgan Chase

The week’s top class action lawsuits and settlements. Top stories include the Target Data Breach lawsuit, Carfax, and more from Mr. Madoff…

Top Class Action Lawsuits

Target targeted, by a computer virus and now a class action lawsuit. In case you hadn’t heard—the US’s second largest retailer got hit with a massive data breach just before Christmas—which latest reports indicate could affect as many as 70 million customer’s credit and debit cards.

Filed in California federal court by lead plaintiff Lisa Purcell (“Plaintiff”), the Target lawsuit seeks to represent all those similarly situated to obtain damages, restitution and injunctive relief for the Class. “The information Target lost, including Plaintiff’s identifying information and other financial information, is extremely valuable to thieves. As the Federal Trade Commission (“FTC”) recognizes, once identity thieves have personal information, they can drain your bank account, run up your credit cards, open new utility accounts, or get medical treatment on your health insurance,” the lawsuit states.

According to a statement issued by Target, the so-called track data was stolen in real time as payment cards were swiped in its stores between November 27, the day before Thanksgiving, and December 15.

The Target lawsuit states “Investigators believe the data was obtained via software installed on machines that customers use to swipe magnetic strips on their cards when paying for merchandise at Target stores.” And “The thieves may also have accessed PIN numbers for affected customers’ debit cards, allowing the thieves to withdraw money from those customers’ bank accounts. Thieves could not have accessed this information and installed the software on Target’s point-of-sale machines but for Target’s negligence, and that Target failed to implement and maintain reasonable security procedures and practices appropriate to the nature and scope of the information compromised in the data breach.”

Among the allegations is the clam that Target was negligent in its failure to implement and maintain reasonable security procedures and practices appropriate to the nature and scope of the information compromised in the data breach. Further, “Target unreasonably delayed informing anyone about the breach of security of Class Members’ confidential and personal information after Target knew the data breach had occurred,” the lawsuit states.

FYI—investigations into the breach are reportedly underway by the US Secret Service and two states’ attorneys general.

Carfax taking some Flak. An antitrust class action lawsuit has been filed against Carfax, alleging the company impairs competition through its exclusive and illegal alliances with Autotrader.com, and Cars.com, as well as with the majority of the automobile manufacturers’ certified pre-owned programs. The lawsuit further alleges that, as a result, automobile dealers are forced to conduct business with CARFAX at grossly inflated prices only to have CARFAX spend these inflated revenues on ads that disparage dealers as dishonest and untrustworthy.

The lawsuit, entitled Maxon Hyundai Mazda et-al. vs. Carfax, Inc, currently has approximately 500 dealer plaintiffs signed up, a number that is expected to increase as the suit progresses.

Top Settlements

More from Madoff… Ok—here’s one for the record books—a settlement for the Class of BLMIS/Madoff customers has been reached affecting (“Class Action Settlement”) all potential claims against JPMorgan Chase Bank, N.A. and its parents, subsidiaries and affiliates (“JPMorgan”). The proposed Class Action Settlement will be contemporaneously presented by motions for approval to both United States District Court Judge McMahon and to Bankruptcy Court Judge Lifland. The filed case number is 11-cv-7866 (VM) (U.S. Dist. Ct., S.D.N.Y.).

The settlement of this Class Action is one part of a multi-part resolution of Madoff-related litigation against JPMorgan involving simultaneous, separately negotiated settlements, which include the Class Action Settlement in the amount of $218 million, the SIPA Trustee’s Avoidance Action settlement in the amount of $325 million, and a resolution with the U.S. Attorney’s Office for the Southern District of New York that includes a civil forfeiture in the amount of $1.7 billion.

The payments by JPMorgan in connection with these agreements will total $2.243 billion and will benefit victims of Madoff’s Ponzi scheme.

Ok Folks, That’s all for this week. Happy New Year! Here’s to a peaceful and prosperous 2014 for all.

Week Adjourned: 11.11.11

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

Top Class Actions

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

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

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

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

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

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

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

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

Top Settlements

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

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

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

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

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

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

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

Week Adjourned: 4.22.11

Top Class Actions

Copping out on COBRA? Brunel Energy Inc and Brunel Energy Group Health Plan got hit with a class action this week. It was filed on behalf of current and former participants in the Brunel Energy Group Health Plan (“the Plan”) who allege Brunel failed to provide health care coverage continuing health care coverage (commonly called COBRA coverage) to employees and their beneficiaries who were covered under the Plan through an insurance policy with BUPA International.

According to the complaint Brunel did not notify employees of their entitlement to COBRA coverage or of their right to obtain coverage at a reduced rate as authorized by Congress in its recent economic stimulus package.

According to the Complaint, when asked for a COBRA package by a terminated employee, Brunel advised the former employee that COBRA coverage was not available. Even after being notified by the U.S. Department of Labor that the former employee was entitled to elect COBRA coverage at the statutorily reduced rate, the Complaint alleges that Brunel did not offer the coverage. Would this come under the heading of ‘cost savings’?

The Complaint seeks an injunction requiring Brunel to bring its health care plan into compliance with the law and an order requiring Brunel to reimburse former employees and their beneficiaries for certain health care costs they would not have incurred had they been allowed to elect COBRA coverage. Wait—there’s more—the complaint also seeks civil money penalties of up to $110 dollars a day for Brunel’s failure to provide statutory notices describing the Plan and apprising employees and their beneficiaries of their COBRA rights as required by law.

Top Settlements

Don’t Mess with our Vets. JP Morgan Chase was all apologies this week, on the back of a settlement reached with its customers who are or were military personnel, who had filed a class action against the bank alleging that it was wrongly foreclosing on families of service personnel and overcharging them on their mortgages to boot. Does that come under the definition of ‘free market economy’? (don’t get me started on that one)

Well, it obviously did in JP Morgan’s version. But, in February, a J.P. Morgan executive apologized at a U.S. House hearing on its behavior. Then they rolled out a series of programs to help active members and veterans—programs including educational initiatives. And, they said that the bank would no longer foreclose on any currently deployed military personnel. How generous of them.

The financial protections that the suit sought to have reinstated are in fact afforded US military personnel under the Service members Civil Relief Act (SCRA). So, maybe it wasn’t just an attack of conscience on JP Morgan’s part.

In any event, Reuters reported that under the terms of the settlement “J.P. Morgan said it will pay $12 million to the class-action suit and set aside $15 million for additional damages on a case-by-case basis. Any unused funds will be used to benefit a charity selected by the U.S. military.” (Reuters.com)

Baby Brain Food? Guess Not. If you got duped into buying an expensive brand of infant formula—Enfamil, made by Mead Johnson & Co—you may be pleased to know they’ve reached a preliminary settlement in the class action they were facing concerning allegations of false advertising.

The suit claimed that Mead falsely represented that Enfamil LIPIL is the only infant formula that contains DHA and ARA—fatty acids it claims are “clinically proved to improve brain and eye function in infants.” Are you kidding? If that really were the case they’d be putting that stuff in the tap water.

If the settlement is approved, people who purchased Enfamil LIPIL formula for six months or less between October 13, 2005 and March 31, 2010, can file a claim to receive either one 12.5 oz container of Infant Formula or $6 in cash.

For those folks who purchased Enfamil LIPIL formula for more than six months between October 13, 2005 and March 31, 2010, you can file a claim to receive either two 12.5 oz containers of Infant Formula or $12 in cash. You can find out if you’re eligible to be a class member here.

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