Week Adjourned: 6.25.11

Top Class Actions

The Tailgate Crack’d? Tailgates aren’t the only thing showing cracks at Ford, it seems. Ford’s in hot water this week as it finds itself facing a consumer fraud class action. The Ford lawsuit, filed Northern District of California, seeks to represent anyone in the country who purchased certain makes and models of SUVs that have experienced damage, as in “a large crack to the tailgate of the vehicle.”  

Well, that would be a little hard to miss. Apparently, or at least according to the lawsuit, Ford “knowingly and fraudulently concealed the cracked tailgate issue in connection with its sale and delivery of model 2002 through model 2005 Ford Explorers and Mercury Mountaineers, and model 2003 through model 2005 Lincoln Aviators.” 

Indeed? Indeed. Indeed, according to the cracked tailgate lawsuit, although Ford knew about the problem in early-2002, the company continued to sell the affected vehicles and systematically refused to repair or replace the damaged tailgates both inside and outside of the warranty period. Umm. That could be a real pain. 

So, the lawsuit alleges that Ford continued sale and delivery of these vehicles and thereby violated the various consumer protection laws of the United States and that Ford’s actions also constitute common law fraud, breach of express warranty, and unjust enrichment.

The Complaint also alleges that Ford made material misrepresentations and concealed material information regarding the design defect that caused the cracked tailgate issue. Moreover, Ford intentionally misled the public so they could continue to sell the affected Ford vehicles and avoid the expense of repair or redesign of the cracked tailgates. Go all that? Not very good for business. Not good at all, actually, if the allegations prove true. 

Top Settlements

Award puts Focus on the Suffering Silent. Every once in a while a story like this makes the news and it’s sad because it takes this kind of distress before attention is paid, it seems. Recently, an elderly nursing home resident was awarded a $4.4 million settlement in a negligence lawsuit. 

The short version is that in 2009, 79-year old Samuel Nevarrez was admitted to San Marino Skilled Nursing and Wellness Centre for rehabilitation after he had fallen at home several times. He stayed at the nursing home for six weeks and during that time he fell a further nine times, which, he claimed in his lawsuit, caused him to suffer a subdural hematoma and a subsequent stroke. That’s a lot of falling.

Nevarrez later returned to the facility where he suffered a further two falls and following the last fall he was placed in hospice. Nevarrez sued the nursing home and its management company, the Country Villa Service Corp, claiming that the staff at the facility did not prevent his falls. The jury hearing the elder care lawsuit found the nursing home 40 percent at fault and Nevarrez 20 percent comparatively negligent. 

Medical Negligence Award puts Elder Care in Focus…Again. And while we’re on the topic, the family of an 88-year old woman who underwent treatment for a Stage IV sacral pressure sore which the family allege was negligently performed and led to their mother’s death, were recently awarded $315,000 in their medical negligence lawsuit.

It’s a very sad case. According to reports on the case, the surgery was done through Vohra Health Services, a wound care company that treated residents at the , where the woman was resident. The woman’s daughter alleged in her lawsuit, that the doctor involved negligently performed a surgical debridement because he didn’t remove all the necrotic tissue from the wound. The daughter also claimed that the surgery and post-operative care from the nurse involved led to her mother’s death. Interestingly, the counsel for the defense also blamed Miami Gardens for the worsening of the woman’s bed sore. So the woman’s family won their case. 

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

Week Adjourned: 6.17.11

Top Class Actions

Logistical Error? Nothing like a lawsuit to improve your company’s standing—or attract quality employees—as FTDI West is about to find out. The company, located in California and Florida, got hit with an unpaid overtime class action lawsuit this week.

The gist of the lawsuit is labor code violations, well, that’s a no-brainer. Specifically, the lawsuit states that FTDI West Inc, violated: Sections 226.7 and 512 of the California Labor Code by failing to provide adequate meal breaks to employees involved, section 226.7 of the California Labor Code by failing to provide adequate rest breaks to employees involved, Section 510 of the California Labor Code by failing to pay proper overtime wages, Sections 203 and 226 (a) of the California Labor code by providing involved employees paystubs not in compliance with California law and not paying “waiting time” penalties, as well as two other causes of action as related to Business and Professions Code Section 17200 and the common law tort of unjust enrichment.

The overtime claims asserted deal with non-payment of “double time” wages. Double time wages are due for any work over 12 hours in a workday or any work beyond eight hours on any seventh consecutive day of a workweek.

The lawsuit defines its class members as “All current and former employees of Defendants who were employed as non-exempt employees at any of Defendants’ locations anywhere in California, at any time from four years prior to the initiation of this action until the present.” 

Top Settlements

Drywall Might Settle but the Dust Surely Hasn’t… Remember all the defective Chinese drywall lawsuits of not so very long ago? Well, they are slowly making their way through the courts to settlement land. Case in point—Banner Supply has agreed a $54.4 million settlement of a class action lawsuit brought by homeowners in the Orlando, FL area. In fact, the agreement covers 2,000 to 3,000 homes south of Orlando.

According to Builderonline something like 95 companies have been implicated as distributors of the sulfur-tainted drywall and named in subsequent lawsuits filed against the Chinese manufacturers. The defendants are accused of being the source of tainted drywall. While Banner Supply tops the list, others suppliers reportedly include ProSales L&W Supply, ProBuild, Stock Building Supply, and 84 Lumber.

While $54.5 million might seem a large settlement, it may only work out to between $18,000 and $24,000 per home, and estimates suggest the cost of repairing the affected properties could reach $100,000.

Defective Boat Injury leads to $31M Award. Ok. There’s bad design, and BAD DESIGN. In this case, I’m not talking about an infraction of the Home & Garden variety, but rather something that warranted a $31 million award. Two women brought a defective product and personal liability lawsuit against MasterCraft, after suffering some pretty horrendous injuries that good design likely would have prevented. 

Short version, in 2006 Nichollette Bell and Bethany Wallenburg were among 12 passengers riding in a MasterCraft X-45 wakeboarding craft. They were sitting on the bow of the boat when it was suddenly submerged as the driver of the boat went to retrieve a fallen wakeboarder. As a result the women were swept off the boat by the force of water and into the lake. The boat’s propeller struck Bell on the head, ripping out an eye and leaving her with brain damage. The propeller also slashed Wallenburg’s left elbow and lower back, resulting in muscle and nerve damage. In their lawsuit, the women alleged the boat was defectively designed. They also alleged the driver handled the boat negligently. Not surprisingly, the jury found MasterCraft 80 percent at fault and the driver 20 percent at fault. 

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

Week Adjourned: 6.11.11

Top Class Actions

Never mind what’s in your wallet…Capital One could be more concerned with what’s left in theirs soon, as it seems they may have been doing a little corporate pick pocketing… it’s very popular these days. A lawsuit seeking class action status was just filed alleging Capital One (NYSE:COF) misrepresented its “Transfer Balance Program” program, resulting in higher-than-expected interest rates for consumers.

The case, filed June 9, 2011, in the United States District Court for the Eastern District of Michigan, alleges that Capital One deceived cardholders by claiming that a cash advance obtained through the company’s transfer balance program would include a 0 percent Annual Percentage Rate (“APR”) for one year. The company also allegedly promised that credit balances on regular monthly purchases (“purchase balances”) would incur no interest as long as the balance was paid within 25 days.

However, according to the complaint, cardholders who took advantage of the transfer balance program were charged interest rates exceeding 13 percent on their purchase balances, even if the balance was paid on time, because payments were applied to the transfer balance rather than to the purchase balance.

The lawsuit alleges that Capital One’s actions constitute a breach of contract and the duty of good faith and fair dealing, in addition to violations of the Virginia Consumer Protection Act and the Michigan Consumer Protection Act. The case also argues that Capital One received unjust enrichment through the alleged scheme.

Ah yes, unjust enrichment…that old chestnut. Seems it never grows old.

Top Settlements

One for the Madoff Meter… While we’re on the subject of things financial—a settlement was recently reached between a group of investors and HSBC Holdings PLC, with Europe’s largest bank agreeing to pay $62.5 million to the investors, who allegedly lost money in association with a Madoff securities fraud.

It seems that the investors had placed funds with Ireland-based Thema International Fund Plc, the assets of which were held with Bernard L. Madoff LLC, according to a statement by HSBC. Bloomberg reports “Thema Fund, a so-called Madoff feeder fund, was controlled by Bank Medici AG. Bank Medici with its founder Sonja Kohn is part of a $59 billion suit by the trustee liquidating Madoff’s firm.” This has to be one of the worst trustee jobs in history, I would think.

Reportedly, Thema was one of several funds placed in the custodianship of HSBC units, which subsequently funnelled monies to Madoff. The settlement is pending court approval.

A statement issued by HSBC stated that the settlement “shall in no way be construed” as an admission of fault. HSBC still faces other Madoff-related lawsuits in other countries including Germany, and Luxembourg. It’s the never ending story.

And it’s a victory for the Ladies. A federal judge in Washington has approved a $32 million settlement of a class action brought against Wells Fargo Advisors by a group of women who alleged gender discrimination.

Reportedly, some 3000 female financial advisors make up the class. The suit was filed in 2009 by three female financial advisors who worked at Wachovia Securities. According to a report in the Wall Street Journal the women claimed that compared with their male counterparts, female advisors were provided fewer business opportunities by the company. The women also claimed that female advisors were at a disadvantage in other ways, specifically with respect to career advancement, work assignments and distribution of accounts.

The class covers all women who were employed as financial advisors by Wachovia or Wells Fargo at any time between March 17, 2003, and January 25, 2011, which is the date a preliminary approval was reached. The class also covers women who were employed by Wells Fargo Investments LLC and women who were employed as advisors by Prudential Securities Inc. or A.G. Edwards & Sons Inc. as of the dates those companies merged with Wachovia. I wonder who’s next?

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