Month: February 2017

Week Adjourned: 2.24.17 – Walmart Beer, Kia Sorrento, Wells Fargo

Top Class Action Lawsuits

Walmart a purveyor of craft beer? Seriously? Maybe not. The world’s largest retailer is facing a consumer fraud class action lawsuit over allegations its craft beer is mass manufactured, and is falsely marketed at an inflated price. You think?

Filed by Matthew Adam of Ohio, the Walmart craft beer lawsuit claims four brands of beer sold by defendant Wal-Mart Stores Inc, are falsely labeled as craft beers. The lawsuit states that the beer is mass-produced at industrial-scale breweries that don’t even resemble what a reasonable consumer would consider a craft brewer.

“Defendant’s Craft Beer has never been a ‘craft beer,’ nor has it been produced by a craft brewery,” Adam claims. “Rather, it is a wholesale fiction created by the Defendant that was designed to deceive consumers into purchasing the Craft Beer at a higher, inflated price.”

According to the complaint, Walmart has been marketing this line of beer since 2016, which includes Cat’s Away IPA, After Party Pale Ale, ‘Round Midnight Belgian White, and Red Flag Amber. Walmart currently stocks these beers at 3,000 retail locations in 45 states.

Further, while Walmart allegedly claims its craft beers are brewed by a company called Trouble Brewing, the Treasury Department lists a company called WX Brands, with the same brewery address as the offices of Genesee Brewing in Rochester, NY. Genesee does not meet the definition of a “craft brewer” put out by the Brewers Association, a trade organization that promotes and protects American craft brewers, the complaint states.

The lawsuit contends that consumers are willing to pay more for beer marketed as craft beer, on the assumption that craft beer is of a higher quality than other beers. Adam claims Walmart craft beer is purposely marketed to exploit that higher dollar value associated with craft beer, when it is, in fact, mass produced.

According to the lawsuit, Adam purchased a 12-pack of Trouble Brewing beer for himself from a Walmart in Sharonville, Ohio. He says he relied on Walmart’s representations that what he was buying was a genuine craft beer. However, the beer was not what he was led to expect, he claims. And he would not have paid a premium price for the beer, had he known the beer he was buying was not actually craft beer.

Adam’s proposed plaintiff Class would include all persons in the state of Ohio who purchased Walmart craft beer. Adam is represented by attorneys Brian T. Giles and Bryce Lenox of Giles Lenox.

The Walmart Craft Beer Class Action Lawsuit is Matthew Adam v. Wal-Mart Stores Inc., Case No. A1700827, in the Court of Common Pleas for Hamilton County, Ohio. 

Top Settlements

Kia Sorrento Settlement… Heads up all you current and prior owners and lessees of a Kia Sorento. Kia has reached a proposed settlement in a pending defective automotive class action lawsuit alleging that its Sorento model is prone to catastrophic engine failure. Remember that one?

Here’s the skinny: the lawsuit, known as Yvonne Robinson et. al., v. Kia Motors America, Inc. et. al., alleges that some 2003 to 2006 model year Kia Sorento vehicles with 3.5 liter engines were equipped with a defective crankshaft pulley bolt that, under certain conditions, could result in the bolt breaking. Those vehicles are referred to as the “Class Vehicles”. KMA has not been found liable for any of the claims alleged in this lawsuit. The parties have instead reached a voluntary settlement in order to avoid a lengthy litigation.

Under the proposed Settlement, and subject to proof and certain limitations, KMA will provide certain financial and/or other benefits to Class Members for past and future crankshaft pulley bolt repairs in Class Vehicles.

Purchasers of the 2003-2006 Kia Sorento automobile now have the opportunity to be reimbursed for their expenses if their crank shaft bolt snapped and caused additional engine damage. Part of the Kia Sorrento settlement includes the opportunity for new and used car purchasers of the 2003-2006 Kia Sorento to submit a claim for reimbursement up to $4,900.00.

Kia Motors Company produced over 200,000 Kia Sorentos and current and prior owners and lessees of Class Vehicles, known as “Class Members”, may be entitled to compensation if they submit valid and timely claims that are approved, and provided the settlement agreement receives final court approval.

Got it? 

Who’s calling? Wells Fargo? Perhaps not anymore… One Ringy Dingy, and we’re off to the bank—thank you so much. Wells Fargo has reached a proposed $15.7 million settlement in a class action lawsuit brought by a man who claims the bank violated the Telephone Consumer protection Act (TCPA) by allegedly using an autodialer to make calls to some 3.4 million consumers. 

If approved, the deal would compensate 3.38 million proposed class members who allegedly received collection calls to their cell phones regarding a retail installment sale contract from Wells Fargo. The calls were made, the suit claims, using an auto dialer, between April 2011 to March 2016.

The settlement amount per class member would be $4.65 each, according to the settlement motion. The lead plaintiff is seeking an incentive award not exceeding $20,000.

According to the lawsuit, Frederick Luster claims Wells Fargo made autodialed calls to his phone number for the past four years in an attempt to collect debts apparently owed by two people he didn’t know. Luster states that at no time did he give permission to Wells Fargo to call his cellphone. However, Wells Fargo made the calls despite being aware that they were violating the TCPA.

“The telephone calls were intentionally, willfully and knowingly initiated,” the complaint states. “The telephone calls were not initiated by accident or mistake.” According to the settlement motion, Wells Fargo maintains that it had prior express consent to call the members of the proposed class.

The case is Luster v. Wells Fargo Dealer Services Inc., case number 1:15-cv-01058, in the U.S. District Court for the Northern District of Georgia.

Ok – That’s a wrap for this week. See you at the bar!

Week Adjourned: 2.17.17 – Oracle, Sprint, Ohio Water Contamination

Top Class Action Lawsuits

Oracle not seeing labor law clearly? Oracle America Inc. is facing a $150 million California labor law class action filed in California federal court over allegations that it knowingly shorted its sales force on commissions of past sales.

File by former Oracle sales representative Marcella Johnson, the lawsuit asserts that Oracle alerted her she would have a negative commission balance of about $20,000 after it “re-planned” how much she would be paid for sales she made in 2013. According to Johnson, she had already received payment of commissions in November and December 2013 under a previously stated “comp plan.” However, Oracle had subsequently applied the new rate for calculating commissions retroactively, to June 2013, the lawsuit states.

“Oracle’s Compensation Department informed plaintiff that pursuant to the T&C [Terms and Conditions of Incentive Compensation], if she stopped working for Oracle, Oracle would have the right to collect the negative balance from her, including through a lawsuit,” the complaint states.

The lawsuit goes on to state that “Plaintiff could not afford to repay Oracle…As a result, plaintiff felt she had no choice but to continue working for Oracle for months without being paid any commissions. The new commissions she earned were levied by Oracle to offset the ‘negative commission balance’ resulting from retroactive imposition of the inferior commission rate.”

Johnson alleges that employees are coerced by Oracle into accepting re-plans by giving the employees just 24 hours to accept the new commission terms and threatening to withhold paid pending commissions.

“Even if a bold employee refuses to agree to an inferior replan, Oracle barrels ahead anyway, applying the re-plan terms to both past and future sales,” the lawsuit states.

Allegedly, through this practice, Oracle has been able to withhold millions of dollars in due commission wages. The commissions are reduced to align the employee pay with the company’s “financial forecasts and bottom line goals.”

The Oracle lawsuit alleges causes of action for failure to pay commission wages in breach of California labor code and contract, failure to pay wages upon separation, and unfair competition. Marcella Johnson is seeking certification of the claims as a class action, restitution, statutory penalties, an award of damages in excess of $150 million and related legal fees and costs.

The case is Marcella Johnson v. Oracle America Inc., number 3:17-cv-00725, in the U.S. District Court, Northern District of California.

Sprint’s at it again? Maybe… they got slapped with a consumer fraud class action lawsuit this week over allegations it deceives customers regarding savings in its “cut-your-cell-phone-bill-in-half” promotion, and fails to deliver as advertised.

Filed in California federal court by Sylvia Nixon of Los Angeles County, the lawsuit claims Sprint deceived her into changing cell phone services in May then failed to deliver on alleged promises to cut her bill in half, pay termination fees she says cost her $1,500, and give her three $350 Visa gift cards.

Nixon claims that had she been aware that Sprint’s “sales tactics rely on falsities that have a tendency to mislead and deceive a reasonable customer,” she would not have changed carriers.

“Defendant misrepresented and falsely advertised to plaintiff and others similarly situated that it would provide these services when defendant had no intention of doing so,” the complaint states. Further, “Defendant’s conduct will continue to cause irreparable injury to consumers unless enjoined or restrained.”

According to statements from 2014 promoting Sprint’s service-change enticements, Sprint indicates that it offers Visa gift cards of up to $350 for each line switched in order to pay for termination fees.

Regarding the cards, the lawsuit states that Sprint “failed to provide … all three $350 visa cards.” Sprint provided her with two, “and even charged the plaintiff for them.” While the complaint does not say how much Nixon paid, nor does it specify the degree to which Sprint failed to offer the promised rate, it does state that Nixon’s rate with Sprint was “well over fifty percent of what she had previously paid.”

The Sprint lawsuit seeks certification of a class of all Sprint customers who accepted the offers, an injunction on current practices, unspecified actual damages, attorneys’ fees and punitive damages. Nixon is also asking the court to make Sprint “at its own cost, notify all class members of the unlawful and deceptive conduct therein,” and to force the company to amend its advertising.

“[T]he injury suffered by plaintiff and members of the class is not an injury which these consumers could reasonably have avoided,” the complaint states. “Plaintiff’s reliance upon defendant’s deceptive statements is reasonable due to the unequal bargaining powers of defendant and plaintiff. For the same reason, it is likely that defendant’s fraudulent business practice would deceive other members of the public.”

The case is Nixon v. Sprint Communications Inc., case number 2:17-cv-01149, in the U.S. District Court for the District of Central California. 

Top Settlements

Here’s big news – in case you missed it – DuPont and Chemours Co have reached a $671 million settlement in multi-district litigation brought against them, that alleged the chemical manufacturers deliberately dumped carcinogenic chemicals, specifically Teflon ingredient C8 or PFOA, into the Ohio River. Seriously.

Their actions, according to the allegations, resulted in 70,000 people being put at risk for cancer as the chemical contaminated their drinking water.

The settlement was preceded by three previous trials brought against DuPont and which had awarded damages to plaintiffs who alleged because of the decades of dumping C8 into the air and water around the plant, DuPont’s actions had resulted in clusters of cancer in six Ohio water districts. DuPont and Chemours, which now owns the plant in West Virginia, each agreed to pay $335.35 million in cash to resolve its obligations concerning about 3,500 total claims.

The first cases were brought in 2001, with allegations DuPont contaminated the drinking supply of 70,000 people in and around the Ohio River where the DuPont plant was situated. The company has already paid or committed to pay $350 million for water filtration systems in the affected communities, health data collection for the class and health studies, the statement said.

Further, Chemours has agreed to pay the initial $25 million of future PFOA costs not covered by the settlement annually for the next five years. DuPont will cover additional amounts up to $25 million, according to the company statement.

DuPont was facing a total of $19.7 million in liability. The first bellwether trial involving plaintiff Carla Bartlett, settled in October 2015 with an award of $1.6 million in compensatory damages. The second bellwether case was brought by plaintiff David Freeman and saw a $5.1 million award in compensation plus a $500,000 punitive award.

Kenneth Vigneron was the plaintiff in the third case. He received $2 million in compensatory damages in December, followed by the a further $10.5 million in punitive damages awarded by the jury. Vigneron’s case alleged that his testicular cancer resulted from exposure to the chemicals DuPont dumped into the water.

According to a statement from a law firm representing the plaintiffs, “The really sad part of this whole mess is that it would have cost DuPont almost nothing to properly dispose of the C8 waste in a safe manner instead of irresponsibly dumping it in the river, pumping it into the ground, and spewing it up into the air. DuPont’s conduct was egregious, dumping the chemical into community water sources with full knowledge that it would likely cause cancer and other diseases among the residents,” the firm said. Notably, neither DuPont nor Chemours have admitted fault, as part of the settlement.

According to media reports, had a settlement had not been reached, US District Judge Edmund Sargus had promised to try 40 cancer cases in 2017 and had already set dates for 10 such trials and was recruiting judges from other districts to assist.

The cases are Moody v. DuPont, case number 2:15-cv-00803, and In re: E.I. du Pont de Nemours and Co. C-8 Personal Injury Litigation, case number 2:13-md-02433, both in the U.S. District Court for the Southern District of Ohio.

Ok – That’s a wrap for this week. See you at the bar!

Week Adjourned: 2.10.17 – Yahoo, Raisinets, Deja Vu Dancers

Top Class Action Lawsuits

Yoohoo! Another Data Breach Lawsuit for Yahoo….Cast your mind back to 2015—end of the year—and an announcement by Yahoo concerning two major—and I do mean major—data breaches. Well, the Internet giant just got hit with a class action lawsuit brought by a small business owner in Texas who alleges his identity and information for his websites and online advertising, which he runs through Yahoo, were compromised during the two large data breaches the Internet giant disclosed in 2015. You knew more were coming…

Specifically, Brian Neff claims that Yahoo and its subsidiary, Aabaco Small Business LLC, breached its contract and negligently allowed hackers to access data on a billion Yahoo users during the two breaches.

Filed in California federal court, the lawsuit claims Yahoo failed to protect the “treasure trove” of personal information he provided to the company in order to set up and pay for an account in 2009. The theft of that data has resulted in a number of fraudulent charges on his bank accounts, as well as an unauthorized card being opened in his name.

In September 2015, Yahoo announced that in late 2014, information from 500 million accounts was stolen. While that Yahoo data breach was considered to be the largest in history, in December Yahoo then revealed that in 2013, hackers had stolen account data for one billion of its users in 2013.

Neff alleges that while Yahoo claims that the data taken was just email addresses and passwords, not bank account information, at this early stage it is unknown whether Yahoo’s descriptions of the breadth of the breaches are accurate.

“Given that more than three years elapsed before Yahoo disclosed the 2013 data breach and more than two years passed before Yahoo disclosed the 2014 data breach, Mr. Neff is rightfully skeptical of Yahoo’s self-serving statements,” the complaint states.

Neff states that in addition to paying Yahoo thousands of dollars “for services that subjected him to a security breach,” he was also the victim of actual identity theft as a result of either or both of the hacks. According to the complaint, Neff has incurred fraudulent charges on his Capital One credit card and his Chase debit card, both of which were on file with Yahoo to pay for the website services. Yahoo was the only company to which Neff had given that information to, the complaint alleges.

Further, the Yahoo lawsuit states that concurrent with the fraudulent charges, an unauthorized credit card account was opened at Credit One Bank in his name, and additional charges were made to that account.

The complaint includes claims for breach of contract, breach of implied contract, negligence, fraudulent and negligent inducement, and violations of California’s Unfair Competition Law.

Head’s up, Neff is seeking to represent a national class of Yahoo and Aabaco small business customers whose personal identifying information was disclosed in the 2013 or 2014 data breaches.

The case is Brian Neff v. Yahoo Inc. et al., case number 5:17-cv-00641, in the U.S. District Court for the Northern District of California.

And what about those Raisinets? No—not talking about exotic dancers or cheerleaders, but the little chocolate covered goodies contained in arguably short supply but a rather large box. Read on.

Nestle is facing a consumer fraud class action lawsuit filed by a customer who alleges the company under-fills its boxes of Raisinets, deliberately deceiving customers as to the quantity of product they are actually buying.

Filed by Plaintiff Sandy Hafer, the Raisinets lawsuit asserts that the opaque packaging of Nestle USA Inc.’s Raisinets candies leads customers to believe they are buying a full box of the chocolate-coated raisins. According to the lawsuit, however, the boxes are only 60 percent full. Hafer claims that this underfilling is intentional and enables Nestle “to reduce its food product costs to the detriment of unwitting customers, who are not receiving the full benefit of their bargain.”

“Unbeknownst to consumers, who cannot see the contents inside the products’ packaging at the time of purchase, approximately 40 percent each [Raisinets’] packaging is non-functional slack-fill, empty space which serves no functional purpose under the law,” the complaint states.

Hafer claims that had she known that the Raisinets box she purchased was underfilled, she would not have bought it. This deception, she asserts, is a violation of California’s false advertising and unfair competition laws.

Hafer, a California resident, is bringing the putative action on behalf of herself and other Raisinets consumers who have similarly found their candy boxes underfilled. Hafer wants the court to restore the money she and consumers allegedly lost as a result of such deceptive practices.

The case is Sandy Hafer v Nestle USA Inc., case number 2:17-cv-00034, in United States District Court for the Central District of California. 

Top Settlements

Deja Vu Dancer Settlement in the Works… These dancers may be dancing for joy soon, or relief perhaps. A $6.M million preliminary settlement has been reached in an employment class action lawsuit filed by dancers at the gentleman’s club chain Deja Vu Consulting Inc. In the more than one dozen complaints, the dancers alleged they were misclassified as independent contractors. The settlement covers between 45,000 and 50,000 dancers at 64 clubs nationwide.

According to the terms of the settlement, the funds will be divided into two pools. The first pool, consisting of $2 million, includes $30,000 in rewards for two proposed class representatives, up to $50,000 in settlement notice and administration costs, and about $935,000 for dancers who opt for cash payments.

The second pool, consisting of $4.5 million, will be divided into credits toward dancers’ rent for stage time or other fees dancers pay the club for the right to perform, depending on the structure of an individual club’s operation. The credit amounts will range from $200 for workers who performed at a club for at least one month to a maximum of $2,000 for dancers who performed for 18 months or longer.

Further, in the hopes of resolving misclassification claims going forward, the settlement also includes injunctive relief in the form of a new process for evaluating employment status. This process involves an evaluation period, after which dancers at the clubs covered in the settlement, will meet with management and answer an economic realities test-based questionnaire designed to determine whether or not a dancer is better classified as an employee or an independent contractor. Those classified as employees will be paid a minimum wage and take home their tips, less the legal costs of their employment and other fees. By contrast, independent contractors will have more freedom to set their hours and pick their costumes.

If the Deja Vu settlement receives final approval, it will cover all former and current dancers who worked at 64 Deja Vu-affiliated clubs across the country, over three class periods that vary depending on the clubs’ geographic location and whether the class members are involved in other lawsuits against Deja Vu.

A fairness hearing is scheduled for June 6, 2017. The case is Jane Doe et al v. Deja Vu et al., case number 2:16-cv-10877, in the U.S. District Court for the Eastern District of Michigan.

Ok – That’s a wrap for this week. See you at the bar!

Week Adjourned: 2.3.17 – Krazy Glue, BP Solar, Lowe’s

Top Class Action Lawsuits

Krazy Glue maker hit with Consumer Fraud Class Action—but will it stick? Elmer’s Products is facing a consumer fraud lawsuit alleging the glue packaging contains slack fill, and that Elmer’s is profiting by way of the packaging, by misleading consumers.

According to the Krazy Glue lawsuit, filed by plaintiff David Spacone, the large and opaque packaging for Krazy Glue misleads customers into thinking the package contains significantly more glue than it actually does. Specifically, the lawsuit states that the opaque container is more than five times larger than the “tiny tube of glue” that contains the product.

“This packaging prevents the consumer from directly seeing or handling the product and leads the reasonable consumer to believe that the package contains significantly more product than it actually does,” the complaint states.

Spacone claims that he bought Krazy Glue at a True Value hardware store in Los Angeles, believing he was buying the amount represented by the “Stay Fresh” container, instead of the smaller tube inside of it. However, because the container is opaque, consumers cannot see how much product they are actually buying, the complaint states.

“If plaintiff had known at the time of purchase the actual size of the tube of product contained in the packaging, he would not have purchased the Krazy Glue or paid less for it,” the lawsuit states.

Here’s an interesting bit of info: The allegation that the container is misleading is based on the amount of nonfunctional slack fill, which is defined in California state law as “the empty space in a package that is filled to substantially less than its capacity,” according to the complaint.

The size and slack fill of the container do not fall within any safe harbor protections provided under state business law, according to the lawsuit, which goes on to state that the container does not protect its contents or have any significant value. Further, the larger container does not have any labeling information that can’t also be found on the tube.

“The use of non-functional slack-fill allows [Elmer’s] to lower their costs by duping customers into thinking they are getting a better bargain than they actually receive,” the complaint says. “As a result, [Elmer’s] has realized sizable profits.

Three classes are proposed, namely a nationwide class of those who purchased a .07-ounce tube of Krazy Glue in a .37-ounce outer container, a California sub-class and a Consumer Legal Remedies Act California subclass.

The complaint alleges violations of California’s Consumer Legal Remedies Act and two violations of unfair competition law. The case is David Spacone v. Elmer’s Products Inc. et al., Case Number BC648907 in the Superior Court of the state of California for the County of Los Angeles.

Top Settlements

Defective BP Solar Panels? No—they can’t blame it on the weather. A $67 million settlement is moving ahead potentially ending a class action lawsuit alleging that solar panels manufactured and sold by BP Solar and Home Depot are defective.

According to the lawsuit, the BP solar panels at issue were substantially certain to fail within their warranted lives due to an inherent defect in the junction box, the small casing on the back of the panel where soldered output cable connections are housed.

Specifically, the BP solar panels at issue were manufactured between 1999 and 2007 with an S-type junction box (“Class Panels”). The lawsuit claims these panels are defective and prone to junction box failures which could cause burn marks at the junction box, shattered glass, and a potential fire hazard. Oh dear. No power but potentially one big bang?

The panels were sold through various distributors and retailers, including but not limited to Solar Depot and Home Depot.

Here’s the skinny getting some cash: The settlement includes anyone in the United States who: (1) purchased certain BP solar panels for installation on a property, or (2) currently owns a property on which these panels are installed and, in either case, who still owns some or all of the BP solar panels.

Settlement Class Members with certain higher failure rate models, or with high failure rates in their arrays, will be eligible for complete replacement of their solar panels. Others will receive replacement of failed panels and a new inverter with advanced safety technology. Owners of large, non-residential systems will be entitled to a mediated commercial negotiation with BP, with extended opt-out rights.

Lowe’s Installers see Settlement…This week’s employment lawsuit is, in fact, a proposed settlement—to the tune of $2.85 million. If approved, it will resolve allegations brought against Lowe’s Home Centers LLC by installation workers who claim they were deliberately misclassified as independent contracts rather than employees. Heard this one before?

Lead plaintiff Thomas Mittl filed the lawsuit in August 2015 claiming that Lowes classified installers and installation companies providing services to Lowe’s customers as independent contractors rather than employees. This, the suit states, is in violation of the New Jersey Construction Industry Independent Contractor Act and common law unjust enrichment.

The result of the alleged misclassification of “independent contractor” was that it prevented the installers from receiving benefits including liability insurance coverage, workers compensation, temporary disability and health insurance. Further, they were barred them from eligibility for Social Security and Medicare, according to the complaint.

Mittl claimed in the lawsuit that he worked 80 hours a week on Lowe’s jobs, however, he didn’t receive benefits and was required to pay self-employment tax on all income earned from Lowe’s.

Mittl owns Toms River Automatic Door & Window Company in New Jersey. In his complaint, he argues that installation workers should be classified as employees because Lowe’s controlled the work they performed, including designating which customers the installers would work for, inspecting their work, requiring customers to pay Lowe’s directly for all work, submitting the installers to background checks, and requiring them to wear Lowe’s hats and shirts while working.

The Lowe’s settlement class consists of all installation workers or installation companies that signed a contract with Lowe’s to perform installation services on behalf of the company in New Jersey. If the settlement receives preliminary approval it will impact some 450 installation workers and companies, according to court papers.

The proposed settlement motion seeks class certification, appointment of Mitl as class representative and a $20,000 incentive award for Mitl as such a representative, among other things. The case is Thomas Mittl v. Lowe’s Home Centers LLC, case number 3:15-cv-06886 in the U.S. District Court for the District of New Jersey.

Ok – That’s a wrap for this week. See you at the bar!