Week Adjourned: 6.26.10

Top Class Actions

Anadarko Petroleum. Who? Just know, if you don’t own shares in Anadarko Petroleum breathe easy. If you do own shares, you better strap yourself in.  A shareholder lawsuit seeking class action status was filed against the petroleum company this week, on behalf of anyone who purchased company common stock of between June 12, 2009 and June 9, 2010, inclusive—otherwise known as the “Class Period”. 

Anadarko, it seems, owns 25 percent of the Macondo/Deepwater Horizon well—you know—the gusher currently leaking millions of gallons of oil into the Gulf of Mexico with ramifications so far reaching it’s impossible to get your head around the scope of the disaster.

The suit alleges that Anadarko and certain of its officers, failed to disclose, “among other things:

1)    that there was no effective Exploration and Oil Spill Response Plan for Macondo/Deepwater Horizon;

2)    that BP implemented drilling procedures solely to cut costs at the expense of safety;

3)    that the Company lacked adequate systems of internal, operational or financial controls to maintain adequate insurance reserves or to meet the known or foreseeable risks associated with its deepwater drilling liabilities; and

4)    that defendants lacked any reasonable basis to claim that Anadarko was operating according to plan, or that Anadarko could achieve guidance sponsored and/or endorsed by defendants.”

And the allegations go on, mentioning false and misleading statements that were issued concerning the amount of the clean-up, and the company’s liability etc, all which culminated in massive drops in share prices. So it’s off to court they go. 

Only one problem, if the company is stripped of millions of dollars in lawsuits, and this goes for BP as well, who’s going to pay for the clean-up, and all the other costs we haven’t even begun to see yet?

And it’s on from Big Oil to Big Banks…those leading lights of the international Continue reading “Week Adjourned: 6.26.10”

Week Adjourned: 6.18.10

Top Class Actions

Corexit Surely Didn’t Correct It. Up until yesterday, I was thinking that at some point in the distant future the BP oil spill may begin a positive chapter, the toxic gusher will finally be capped and the clean-up will begin to make a meaningful impact—we may even be fortunate enough to see the return of some species that are currently threatened with extinction—including the fishermen. 

Then, I saw this: a class action lawsuit filed yesterday, alleging that BP and Nalco Holding Company intentionally sprayed “Corexit 9500” dispersant into the Gulf of Mexico with full knowledge of its dangerous toxicity. The suit alleges that the dispersant was sprayed entirely to lessen BP’s financial exposure and cleanup efforts relating to the oil spill. 

Then I thought to myself ‘Wasn’t BP was on the verge of collecting an award for its environmental achievement just days before this disaster occurred? How could any ethically responsible corporate citizen engage in this activity with any kind of knowledge of the dangers?’ Of course the key point here is ethics…or the complete lack of them. 

According to a press release about the suit, “When administered the dispersant, Corexit 9500, attaches to the oil causing both the oil and the chemical to sink below the surface of the water eventually settling to the sea floor. Studies have demonstrated this process will permanently alter the biosystem and food chain in the Gulf.”  (See the above vid from msnbc where Dr. Seth Forman talks about the potential impact on Corexit on the rest of us.)

But it gets worse, if that’s even possible. “This chemical has been banned in the UK for over a decade,” the press release states. “Corexit is four times as toxic as the oil itself. Oil is toxic at 11 ppm, but Corexit is toxic at only 2.61 ppm. Corexit was banned from use in the United Kingdom because it did not pass the ‘Rocky Shore Test’ which Continue reading “Week Adjourned: 6.18.10”

Week Adjourned: 6.4.10

Top Class Actions

Rehabilitating your disability insurance. Sun Life Assurance got hit with a potential class action this week—filed by a disgruntled (and rightly so) client (or is there another, more accurate term that could be used here…) who alleges that the company denied her disability claim on the lack of something called discretionary proof. Sounds dodgy to me.

Discretionary proof, you ask? According to information issued by the law firm handling the suit, discretionary proof clauses basically amount to a ‘get out of paying the insurance claim’ loophole. But don’t take my word for it. This from the statement on the class action: 

“Discretionary proof clauses have been the subject of intense scrutiny by state regulators and insurance commissioners. The clauses provide that an insurer will pay a disability claim only if it is “satisfied” with the policyholder’s proof. Many insured persons claim that despite extensive proof of medical disability, including surgical reports, treatment records, and doctors’ affidavits, Sun Life and other insurers are “never satisfied” leaving them without disability coverage.” 

Why am I not surprised by this? 

Apparently, on June 1, 2007, the State of Michigan Insurance Commissioner outlawed discretionary proof clauses in all disability contracts delivered within the state. The insurance industry challenged the Michigan regulation, and on March 18, 2009, a federal appeals court decision found that the Michigan regulation was valid and lawful.

I don’t know about you—but I’m checking the fine print on my policy…

Top Settlements

No Eclipsing that Halitosis. Now—here’s a big win for all you gum chewers out there. Wrigley has agreed a $6M settlement in a class action suit over Eclipse gum.

Before you get too excited—the amount each class member will receive is about enough to buy another couple of packs of gum. The settlement works out to about $10 per person. But the lawyers Continue reading “Week Adjourned: 6.4.10”