Week Adjourned: 3.25.11

Top Class Actions

Faulty Wiring? There were some interesting suits this week. Among them—this one against AT&T, filed by an 82-year old woman who alleges that the $9.99 she pays every month for an Inside Wire Protection Plan” is a service she doesn’t need and can’t use because she lives in an apartment building in which she doesn’t own the interior telephone wires. Therefore, she has no legal responsibility for maintaining them and therefore she should not have to pay the $9.99 demanded by AT&T. Who knew? 

But that seemingly small monthly charge adds up to about $120 a year, and it’s being paid by thousands of AT&T customers across the US, who are in similar situations to Gloria Girton.

Consequently, Ms. Girton has filed a class action in the US District Court for the Eastern District of North Carolina to end AT&T’s unlawful practice of wrongfully billing for such plans nationwide. Outside of North Carolina, they are known by such names as “Wire Pro,” “Inside Wire Maintenance,” and “Home Wire Protection.”

AT&T is illegally charging many of its land line customers who live in multi-tenant facilities for unnecessary wire insurance, the plaintiff’s lawyers state. “The company knows from prior litigation and its own internal investigations that this charge is improper, yet it continues to charge building tenants like Gloria for these worthless plans through deceptive sales actions that defraud and rob them of their hard-earned financial resources. We believe she and the class have sustained damages of at least $10 million and very likely much more,” says plaintiff’s counsel.

The complaint asks for the certification of two classes, a North Carolina class and a nationwide class, each comprised of all residents of residential or commercial property who had an AT&T account at any time in the past four years and were not responsible for the maintenance of their residence’s interior wire, but were charged a fee for an Inside Wire plan. You go Gloria! 

Top Settlements

Press Brake Operator Verdict. A laborer in Florida has won his personal injury case with the jury awarding him a $3.3 million verdict. What happened? Sadly, he who suffered amputation of all the fingers on his right hand—which is the hand he wrote with. It was a workplace accident, involving a mechanical press in 2005.

Phiteau Dalien had his hand caught in a vintage 50-ton mechanical press brake he was operating for List Industries Inc. As a result his hand was crushed and he and he had to have his fingers amputated. He was 33 years old at the time. He underwent a subsequent surgery to build a partial thumb, and he may need another operation to try and rebuild his other fingers.

In his suit, Dalien alleged that the outdated machine he was operating for List Industries lacked safety features and that a language barrier prevented him from being properly trained. List Industries claimed the accident was caused by operator error. Of course they did. But the jury wasn’t buying. 

Getting Royally Stiffed? Not any more for about 25,000 landowners in Pennsylvania. They brought a class action brought against Texas-based Range Resources in 2008 over allegations that the company was miscalculating their royalty payments associated with the company’s current drilling in the Marcellus Shale region of the state. Land which these people presumably own. The suit also alleged that Range Resources improperly withheld management fees from royalties and failed to account to landowners for money it had collected from selling oil and residual by products of gas processing. 

A  settlement has now been approved by a federal judge and the terms dictate that Range Resources, will pay the landowners roughly $1.3 million now and subsequently increase the royalty payment to a maximum of $16.6 million over the next five years, according to court documents. Well Done.

Okee dokee—that’s it for this week. See you at the bar.

Week Adjourned: 3.19.11

Top Class Actions

Who’s watching you while you’re watching video? This week in California, a class action was filed in federal court against Netflix alleging the movie rental company is violating the federal Video Privacy Protection Act (VPPA), the California Customer Records Act, and Unfair Competition Law, as well as charging the company with unjust enrichment, and breach of fiduciary duty. Hmm. No shortage of charges there.

What’s it all about—Alfie? (sorry, couldn’t resist). Well, according to Virginia resident Peter Comstock, who filed the proposed class action, the specific allegations are that Netflix keeps digital records of each subscriber’s choices of streaming video and video rental and then uses that data to make recommendations for other movies that customers might be interested in viewing. The lawsuit states that this kind of tracking is “hardly surprising,” but adds that “subscribers do not realize (is) that Netflix maintains this video-viewing information, along with confidential subscriber payment information…in its databases long after subscribers cancel their Netflix subscription.”

The suit is seeking $2,500 per violation of the VPPA, $3,000 per violation of the Consumer Records Act, and further punitive damages. This could end up being  a very costly exercise in record-keeping. 

Top Settlements

Large Asbestos Verdict in Virginia. This is one of those verdicts that, while good, stems from deeply unfortunate and avoidable circumstances. A Newport Circuit Court jury delivered a $25 million verdict to a former shipyard employee as settlement of his asbestos case. The verdict, against Exxon Mobil, represents one of the largest jury verdicts ever handed down in Virginia for a personal injury case.

The jury awarded 72-year old Bert Minton $12 million in compensatory damages, $12.5 million in punitive damages, and $430,961 in medical bills. The jury awarded interest on the medical bills, bringing the total verdict to $25 million.

Minton’s story is not uncommon. He had worked as a repair supervisor on commercial vessels at the Newport News Shipbuilding facility between 1966 and 1977, and worked as a ship fitter prior to his time at Newport. He reportedly worked on 17 Exxon commercial oil tankers while employed at the ship yard.

And that work exposed him to asbestos fibers, which he inhaled. So now, decades later, he has been diagnosed with mesothelioma. According to Minton’s lawyer, Minton now has a life expectancy of roughly two years and faces a painful death. 

First Group gets Lesson in Fair Credit. This is a good news story for the working guy—always nice to have one of those on a Friday. A tentative $4.3 million settlement has been approved in the class action against First Group America. The national suit, brought by employees of sister companies First Student, which employees school bus drivers, and First Transit, which employs mass transit drivers, claimed the companies obtained criminal background checks on drivers and job applicants without the job applicants and employees written permission, which is a violation of federal law.

Makes you wonder how many other companies are doing the same thing…

In any event, the settlement is reportedly the largest ever regarding employment-related Fair Credit Reporting Act claims. Ex-employees of First Transit or First Student, who were terminated as a result of the unauthorized background checks, and who decide to participate in the proposed settlement, could receive potential payment of between $2,000 and $4,000 per unauthorized background check.

The terms of the settlement also stipulate a payment of $750 for each worker who was terminated by First Transit or First Student based on a criminal background check report without first receiving a copy of that report.

For workers who continued to work for either of the companies but who were the subject of unauthorized background checks, a payment of between $150 and $300 may apply.

Okee dokee—that’s it for this week. See you at the bar…

Week Adjourned: 3.11.2011

Top Class Actions

Oh those Groupon coupons—you know—the notice you find in your email every morning offering amazing deals on everything from restaurant meals to hotel stays to my personal favorite—half price pedicures… but are they too good to be true? Some people seem to think so, in fact they believe Groupon Inc. is violating Illinois state and federal laws that prohibit companies from selling gift certificates with expiration dates.   So, they have filed a federal class action lawsuit against the Chicago-based business this week.  

The suit was filed in the state of Minnesota on behalf of a Washington man who claims he bought a $20 Groupon for a one-month gym membership worth $305, only to have it expire before he could redeem it two months later. Umm…sound familiar?

Not surprisingly, the suit alleges that Groupon and its retail partners reap a substantial windfall from the sale of gift certificates that are not redeemed before expiration. The suit claims that Groupon “preys on unsuspecting consumers” by requiring users to agree to “boilerplate” terms and conditions that include a class action waiver. A class action waiver? Well, that certainly was effective.

Top Settlements

Credit Suisse Ponies Up for Subprime Mortgage Exposure…Credit Suisse Group AG agreed to pony-up $70 million this week, to end securities litigation over allegations that it ‘mislead investors about its subprime exposure and ability to limit losses.’ (My question, is there any financial institution out there that didn’t mislead the public over subprime mortgage exposure?) 

The settlement requires court approval, but if approved it will allow recovery for investors who bought Credit Suisse’s American depositary shares, and U.S. investors who bought Credit Suisse securities in Switzerland, between February 15, 2007 and April 14, 2008.

According to reports by Reuters, on February 19, 2008, Credit Suisse took a $2.85 billion write down and suspended some traders who overstated the value of some assets. Company shares fell 6.6 percent that day. Then on March 20, Credit Suisse said write downs would contribute to a surprise first-quarter loss, and its shares fell 6.4 percent. Surprise? I think the real surprise was getting caught.

This is an extraordinary happy Friday story! This week, Midland Funding LLS agreed to drop over 10,000 debt collection cases, totally some $10.2 million in debt that it currently holds against consumers in the state of Maryland. The agreement was approved by a judge this week. The suit was filed against Midland in 2009 by consumers in Maryland.

Bit of back story—Midland is a subsidiary of the publicly traded Encore Capital Group, which buys and collects consumer debt. The case alleges that Midland “prolonged, illegal, and systematic abuse of thousands of Maryland residents.” Plaintiffs further alleged that Midland was operating as a debt collector without a state license, in violation of state and federal law. Oops. That may explain the sudden bout of corporate good will.

As part of the settlement Midland also agreed not to refile lawsuits or to sell the accounts in which there are outstanding debts. However, Midland will be allowed to contact debtors for payment as long as it follows debt-collection laws. Oh yes—Midland is now licensed to collect debts. Convenient. 

Okee dokee—that’s it for this week. See you at the bar.

Week Adjourned: 3.4.11

Top Class Actions

Glass Ceiling with a $100M Price Tag at CIGNA? Well, this has certainly been a time for discrimination class actions. Filed, that is. Topping the list—Cigna Health Care—based on the number of potential plaintiffs—dollars. This one’s all about gender discrimination—in the form of a hostile work environment and differential treatment of males and females occurs company-wide the suit alleges. 

The complaint, filed by Ms. Bretta Karp, a long-time contracting manager with Cigna, claims that Ms. Karp and other female employees were disriminated against by treating them less favorably than male employees in similar positions and by subjecting all females to intentional, deliberate and wilful discriminatory denials of promotions and pay raises, discriminatory evaluations, disparate terms and conditions of work, harassment, hostile work environments, and other forms of discrimination in callous disregard of their rights.

The complaint further details that CIGNA has created a hostile work environment where male supervisors harass and intimidate female employees, where management has made clear that it favors male employees over women, and where company investigations into complaints made by female employees are either nonexistent or superficial and inadequate.

And the amount sought in damages? $100 million baby—along with litigation costs and Continue reading “Week Adjourned: 3.4.11”