Wage and Hour - Part 3

Week Adjourned: 7.13.12 – Hyundai Elantra, Wells Fargo, ABM Security

The weekly wrap of top class action lawsuits and settlements for the week ending July 13, 2012. Top class actions include Hyundai Elantra, Wells Fargo and ABM Security Services.

Top Class Action Lawsuits

More mileage out of its customers than its cars? Maybe. At least the folks who filed a consumer fraud class action lawsuit against Hyundi Motor America think so.

The Hyundai Elantra class action lawsuit alleges that Hyundai deceived customers regarding gas mileage claims for the Elantra. The lawsuit, filed in Sacramento Superior Court, alleges that Hyundi’s ad for the Elantra was misleading because it included the phrase “The 40 mile per gallon Elantra.” The class action lawsuits, filed by Cuneo Gilbert and LaDuca, LLP, also claims Hyundai attempted to manipulate customers who are concerned about escalating gas prices and fuel economy.

The lawsuit further alleges that while the Elantra may average 40 mpg during ideal highway driving conditions, it does not achieve that same figure under most other driving scenarios.

Hyundai’s advertisements for the 2011 and 2012 Elantra models caused tens of thousands of California drivers to purchase the vehicle under false pretenses, the plaintiffs allege.

The lawsuit seeks to stop Hyundai from illegally using gas mileage numbers in its advertising of the Elantra without government-mandated disclosures and asks for damages on behalf of California residents who purchased or leased 2011 and 2012 Elantras.

Top Settlements

Wells Fargo hits the bottom of the well… A $175 million settlement has been agreed by Wells Fargo in a discrimination action brought against the nation’s largest residential home mortgage originator by the Department of Justice (DOJ).

The DOJ alleged Wells Fargo manipulated African-American and Hispanic borrowers into taking on more costly subprime loans or charging them higher fees than those issued to comparable white borrowers. More than 30,000 minority borrowers were affected between 2004 and 2009, the Justice Department said. Unbelievable!

“If you were African-American or Latino, you were more likely to be placed in a subprime loan or pay more for your mortgage loan, even though you were qualified and deserved better treatment,” Assistant Attorney General Thomas Perez said in a statement.

“This is a case about real people—African-American and Latino—who suffered real harm as a result of Wells Fargo’s discriminatory lending practices.”

As an example, in 2007 a typical African-American wholesale borrower in Chicago seeking a $300,000 loan from Wells Fargo paid nearly $3,000 more in fees than a similarly qualified white applicant, the Justice Department said.

Wells Fargo has denied the government’s allegations, saying it agreed to settle the case “solely for the purpose of avoiding contested litigation.”

If the settlement receives final court approval, as part of the agreement, Wells Fargo will pay $125 million in compensation to victims of discrimination, and $50 million in down-payment assistance to borrowers in affected communities, CNN Money reports.

Cha-Ching! An $89.7 million settlement has been awarded by a California state judge to 15,000 former and present security guards of ABM Security Services Inc, who filed an unpaid wages class action lawsuit concerning rest breaks.

The ABM Security Services class action lawsuit, entitled Jennifer Augustus vs. American Commercial Social Security Services et al, was filed in July 2005. It alleged the guards were given “on-duty” breaks during which they were required to keep their cellphones or pagers on.

In his ruling, Los Angeles County Superior Court Judge John S. Wiley said the company “balks at the notion that the employer must relieve workers of all duties for the rest break to be legally valid,” said in his ruling. “Put simply, if you are on call, you are not on break. That has been the law for many years.” Way to go!

Ok—That’s a wrap. Time for ‘tinis…see you at the bar!

Week Adjourned: 6.15.12 – Gamestop, Novartis, Krossland Calling Cards

The weekly wrap of top class action lawsuits and settlements for the week ending June 15, 2012. Top stories include Gamestop, Novartis Pharma Sales Reps and Krossland Calling Cards.

It’s been a week for wage and hour lawsuits and settlements…

Top Lawsuits

Paycheck Games? Gamestop got hit with a wage and hour class action lawsuit this week, alleging the company committed several California Labor Code violations including systematically neglecting to pay their employees for all hours worked. Really?

In the Gamestop wage and hour class action, employees alleged in their lawsuit that they were required to clock out of Gamestop’s timekeeping system and continue working off the clock to fulfill their daily tasks. Additionally, the lawsuit alleges that Gamestop “consistently does not allocate enough labor hours such that there is not enough time for the employees to complete their required duties within the allocated labor hours.” As a result, the Complaint claims that these employees were systematically denied compensation for the actual number of hours worked. Sound familiar?

Wait—there’s more. The lawsuit also asserts that the Gamestop employees were regularly denied meal and rest breaks, and there was no policy in place to compensate employees for missed meal or rest breaks. Specifically, the lawsuit claims that, “Plaintiff and California Class Members are required by [Gamestop] to work alone, or with an employee that cannot be left alone in [a Gamestop] store, for the first five (5) hours of their scheduled shift.”

The case, filed June 5, is pending in San Diego, CA, in case you know anyone…

Top Settlements

Continuing with our theme of wage & hour lawsuits…

Pharma Sales Reps Get Their Due. This time a settlement—a final approval, in fact,—of a $99 million settlement in the nationwide wage and hour class action brought by Novartis Pharmaceuticals Corp. sales representatives. http://www.lawyersandsettlements.com/settlements/16682/99-million-settlement-approved-in-novartis-sales.html

On May 31, Judge Paul A. Crotty of U.S. District Court for the Southern District of New York approved the settlement following a fairness hearing held the same day. This follows the preliminary approval of the settlement granted by Crotty in January. The settlements are the result of two lawsuits filed in 2006 citing violations of the Fair Labor Standards Act and California and New York laws (30 HRR 91, 1/30/12).

The final order and judgment allocated $70,758,500 to settlement awards for class members; $27,608,000 to attorneys’ fees; $400,000 to reimbursement of litigation fees; and $233,500 to class representatives and others involved in the case.

The $233,500 included compensatory damages and service awards ranging from $20,000 to $40,000 for each of five named plaintiffs.

And now for something completely different—how about a little consumer fraud? (Served with a healthy portion of “Oh no you don’t”.)

Kross To Bear? Krossland Communications—Krossland calling cards?? Ringing any bells? Well, a settlement has been reached. Here’s the summary notice, “issued in accordance with the Court order dated May 21, 2012 preliminarily approving the settlement of a consumer fraud class action entitled Carol Galvan, et al. v. Krossland Communications, Inc., United States District Court, Central District of California, Case No. 8:08-CV-00999-JVS (ANx).”

Lolis Tackwood represents a class of pre-paid calling card customers who purchased certain calling cards distributed by Krossland between August 26, 2004 and May 21, 2012, other than for purposes of re-sale, and other than calling cards distributed by Locus, AT&T, T-Mobile, Boost, Total Call and IDT. A list of those cards affected by this settlement can be reviewed by accessing http://www.KrosslandSettlement.com .

If consumers who purchased these calling cards submit a Claim Form, they can receive a Refund PIN that can be used to make telephone calls to any location in North, Central or South America, at the rate of 20 cents/minute to any telephone number within the United States and any landline telephone number in North, Central or South America, and 50 cents/minute to any cellular telephone number outside the United States in those locations.

There is a total cap of $250,000 on the dollar amount of Refund PINs, less certain fees and costs. Individual claims are capped at $16.00 in Refund PINs, rounded up to the nearest 50 cent increment, based on 30% of the face value of consumers’ eligible Krossland Calling Card purchases during the Class Period, subject to possible proration as described in the full class settlement notice. The Refund PIN may be used within 1 year of activation, and a deadline for using this PIN shall be provided with the PIN. Settlement Class members can submit a Proof of Claim Form online at http://www.KrosslandSettlement.com or by requesting a Proof of Claim Form from the Settlement Administrator and submitting it to the address below.

To be excluded from this settlement, or to object to the settlement, Settlement Class Members must follow the instructions in the Notice described below. The deadline to opt out of the settlement is August 6, 2012. The deadline to submit any objection is July 27, 2012.

This is only a summary of the settlement. For additional information regarding this settlement, the full Notice of Class Action Settlement (“Notice”) is available at http://www.KrosslandSettlement.com.”

Ok—Happy Friday Folks. See you at the bar! Oh yes!

Week Adjourned: 6.8.12 – Catalina Restaurants, NobelTel, Hilton LAX

Weekly wrap of top class action lawsuits and settlements, for the week ending June 8, 2012; top stories include Catalina Restaurant Group, NobelTel, and Hilton LAX hotel

Top Lawsuits

Overtime Violations on the Menu at Catalina. First up this week, an overtime class action lawsuit. This one filed against Catalina Restaurant Group Inc. and JoJo’s California Family Restaurants, Inc. (“Catalina”) for alleged wage and hour violations.

Specifically? Violations of California labor laws in regards to overtime pay and requiring their employees to work off-the-clock without being paid for all their hours worked. McDermott, et al. vs. Catalina Restaurant Group Inc. and JoJo’s California Family Restaurants, Inc., was filed by attorneys at Blumenthal, Nordrehaug & Bhowmik, who are representing the plaintiffs.

According to the class action lawsuit, the restaurant “did not have in place an immutable timekeeping system to accurately record and pay Plaintiff and other California Class Members for the actual number of hours these employees worked each day, including overtime hours worked.” Specifically, the lawsuit claims that Catalina “consistently did not allocate enough labor hours such that there was not enough time for Plaintiff and California Class Members to complete their required duties.” As a result, the Complaint alleges Plaintiff and California Class Members were forced to clock out of Catalina’s timekeeping system, but were still required to perform additional work for Catalina for which they were not compensated for.

Furthermore, the complaint also alleges that the Plaintiff and California Class Members received non-discretionary quarterly bonuses from Catalina, but Catalina failed to include this extra bonus compensation in the regular rate of pay for the purposes of calculating the correct overtime pay rates owed to these employees. The failure to include the bonus compensation in the regular rate of pay for overtime purposes, according to the complaint, “has resulted in a systematic underpayment of overtime compensation” to the Plaintiff and members of the California Class.

The Complaint further claims that as a result of Catalina’s failure to record all hours worked by members of the California Class and Catalina’s failure to pay these employees the correct overtime rate, Catalina “failed to provide the Plaintiff and the other members of the California Class with complete and accurate wage statements which failed to show, among other things, the correct number of all hours worked and the correct overtime rate for overtime hours worked.”

Founding partner of Blumenthal, Nordrehaug, & Bhowmik, Norman Blumenthal asserts, “when employers exclude non-discretionary bonuses from the regular rate of pay when calculating their employee’s overtime rate, they are violating the law.”

Top Settlements

Ignobel NobelTel? A settlement has been proposed in the of a consumer fraud class action lawsuit captioned Sabaj et al. v. NobelTel, LLC et al. (aka, NobelTel Prepaid Calling Card class action lawsuit)

It could affect you if you purchased prepaid calling cards that were sold, serviced or distributed in California by Nobel, Inc., Nobel, Ltd., NobelCom, LLC, and NobelTel, LLC (“Defendants”), or if you purchased any prepaid calling services sold online and submitted a California billing address through www.nobelcom.com and www.enjoyprepaid.com, between April 8, 2006 and May 24, 2012 (“Nobel Prepaid Calling Cards”). If you made such a purchase, you may be a member of the Settlement Class. (This is only a summary legal notice. A detailed notice is available at the websites and toll free number listed below.)

What Is The NobelTel Lawsuit About?

The consumer fraud lawsuit claims that the Defendants did not inform consumers sufficiently about the applicable rates and charges for their prepaid calling cards and services, failed to deliver minutes voice prompted by the cards, and violated California consumer protection laws. Defendants deny they did anything wrong.

Am I Affected By The NobelTel Settlement?

You are a member of the Class if you purchased a prepaid calling card issued by Nobel, Inc., Nobel, Ltd., NobelCom, LLC, and NobelTel, LLC in California between April 8, 2006 and May 24, 2012. A list of eligible calling cards is available on the websites listed below.

You are also a member of the Class if you purchased any prepaid calling services sold online between April 8, 2006 and May 24, 2012 and you provided a California billing address through www.nobelcom.com and www.enjoyprepaid.com.

What Benefits Does The NobelTel Settlement Provide?

Defendants will provide 400,000 $5.00 calling card Settlement Personal Identification Numbers (“Settlement PINs”). These Settlement PINs can be used to make international and domestic calls, originating from California, to any place in the continental United States and to 879 foreign locations. A complete list of locations is available on the websites below. If you purchased Nobel Prepaid Calling Cards online, you may be entitled to receive one (1) Settlement PIN for up to the first $40 in Nobel Prepaid Calling Cards purchased, and an additional Settlement PIN for every $40 increment thereafter. If you purchased Nobel Prepaid Calling Cards in a physical store in California, you may be entitled to receive one (1) Settlement PIN for up to the first $20 in Nobel Prepaid Calling Cards purchased, and an additional Settlement PIN for every $20 increment thereafter, up to a maximum of six (6) Settlement PINs.

How Do I Make a Claim in the NobelTel Settlement?

If you purchased prepaid calling services sold online through www.nobelcom.com and www.enjoyprepaid.com, you will automatically receive the Settlement PIN(s) at the e-mail address you provided to Defendants without having to submit anything.

If you purchased a prepaid calling card in some other manner, you must submit a Refund Form to receive the Settlement PIN(s) by mail no later than November 20, 2012 to February 18, 2013.

What Are My Other Legal Rights?

Remain in the Settlement: You will be bound by the terms of the Settlement and give up your right to sue Defendants. To receive the Settlement PIN(s) see the instructions above.

Get out of the Settlement: If you wish to keep your right to sue Defendants, you must exclude yourself by August 13, 2012.

Remain in the Settlement and Object: If you stay in the Settlement, you can object to it by August 13, 2012. You give up your right to sue and are bound by all Court orders even if your objection is rejected.

A hearing in the case, Sabaj et al. v. NobelTel, LLC et al. Case No. BC435467 will be held on September 13, 2012 to consider whether to approve the Settlement and a request for attorneys’ fees and expenses up to $500,000.

Umm… the phone card that never runs out…

Hilton Settlement–No not with Paris, This one’s in LA…The Hilton Los Angeles Airport Hotel has agreed a $2.5 million settlement in the wage and hour class action brought by 1,200 of its hotel workers. The Hilton lawsuit alleged that the hotel withheld wages, failed to pay overtime and failed to provide meal and rest breaks.

Filed in 2008, the unpaid overtime class action covers all hourly workers who worked at the hotel from 2004 to 2011.

Other allegations included in the employment lawsuit were that the Hilton LAX did not pay its employees for time spent preparing for work and putting on and taking off work uniforms that were required to be left at the hotel. And, that plaintiffs were required to fill out time sheets saying they took breaks whether they truthfully did or not.

Well – someone had to pay for Paris’ exploits…

Ok – that’s a wrap. See you at the bar. Happy Friday Folks.

Week Adjourned: 10.15.11

Top Class Actions

Well, Hello…Something fruity is going on here—or not as the case may be… A proposed consumer fraud class action lawsuit has been filed against General Mills alleging the company misled consumers about the nutritional and health qualities of its fruit snacks, specifically Fruit Roll Ups, Fruit by the Foot, Fruit Gushers, as well as other similar products.

The lawsuit claims that between October 15, 2005 to the present (the “class period”) General Mills engaged in a widespread marketing campaign to mislead consumers about the nutritional and health qualities of its Fruit Snacks. Specifically, the suit states, “Defendant made misleading statements that its Products were nutritious, healthful to consume, and better than similar fruit snacks.”

The suit further states “In fact, Defendant’s Fruit Snacks contained trans fat, added sugars, and artificial food dyes; lacked significant amounts of real, natural fruit; and had no dietary fiber. Thus, although the Products were marketed as being healthful and nutritious for children and adults alike, selling these Fruit Snacks was little better than giving candy to children.” Umm…Maybe suitable for Halloween treats?

Top Settlements

Did your internal capacitor prematurely fail? No—I mean the one in your TV! On October 3, 2011, preliminary approval was granted to a proposed defective product class action settlement with Philips Electronics North America Corporation (“Philips”).

The settlement proposes to resolve lawsuits that allege certain Philips and Magnavox televisions suffer from a defect that causes internal components (called capacitors) to prematurely fail, resulting in the televisions becoming inoperable. The proposed settlement would entitle qualifying settlement class members, who purchased new or received as a gift new one of the Philips or Magnavox plasma televisions with the model numbers listed below, to monetary benefits or vouchers.

The model numbers of the Philips and Magnavox plasma televisions included in the proposed class action settlement are:

50PF9830A/37 42PF9630A/37

50PF9731D/37 42PF7321D/37

50PF9631D/37 42PF7320A/37

50PF9630A/37 42PF7220A/37

50PF9431D/37 42PF5321D/37

50PF7321D/37 50MF231D/37

50PF7320A/37 50PF7220A/37

In addition, only those television sets with a serial number reflecting a manufacturing date between November 1, 2005 through December 31, 2006 qualify for participation in this settlement.

The Court has scheduled a hearing in December to determine whether to grant final approval to the settlement.

To be eligible to receive the benefits made available pursuant to this settlement, class members must submit to the claims administrator a claim form that is postmarked by February 28, 2012.

To obtain additional information about the settlement, to determine whether your television qualifies, or to obtain a claim form, you can visit the settlement website at PhilipsPlasmaTVsettlement.com. You can also contact the settlement administrator by calling (855) 477-4407, or by writing to Philips Plasma TV Settlement, c/o Dahl, Inc., P.O. Box 2061, Faribault, MN 55021.

Service gratuity not quite included? This one’s for anyone who ever worked in the service industry and had their tips withheld—and I’m sure there’s no shortage of you out there… A $7 million settlement has been reached by current and past employees of the Cranwell Resort, Spa, & Golf Club in Lenox, ending an employee class-action lawsuit that alleged the resort’s management illegally withheld the workers tips.

If the settlement receives final court approval, approximately 700 food, beverage, and spa employees who worked at the upmarket Berkshire resort between 2001 and 2011 will share in the money. A final settlement hearing is scheduled for November 2011. This is the second of two lawsuits, filed over four years ago, claimed that the employees were not paid the full service charges that were added to hotel bills, which is against state law.

Ok—That’s it for this week. See you at the bar—where I will be repairing my personal, internal capacitor.

Week Adjourned: 7.30.11

Top Class Actions

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

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

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

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

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

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

Top Settlements

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

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

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

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

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

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

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

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

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