Week Adjourned: 5.26.17 – GM Emissions, Doctor Kickbacks, Target

Top Class Action Lawsuits

More Emissions Cheating?? Of course—you knew it was coming. General Motors (GM) got hit with a consumer fraud class action lawsuit this week, accusing the automaker of emissions cheating. A little late to the party—but maybe they figured why not?

Read on…

According to the complaint, GM used defeat devices similar to those used in Volkswagen’s diesel cars, to enable its Silverado and Sierra 2500HD diesel vehicles to pass emissions tests.

The GM emissions complaint alleges that despite GM’s claims that its top-selling Silverado and Sierra 2500HD vehicles are environmentally friendly with high fuel economy and low emissions, in fact they emit far more pollution while on the road than in emissions testing conditions. Well now there’s a surprise.

The complaint states that currently some 705,000 Silverado and Sierra diesels are on the road in the US. Data from emissions testing show that those vehicles emit levels of nitrogen oxide far above standards set by the US Environmental Protection Agency (EPA).

Auto parts supplier Robert Bosch GmbH is also named in the lawsuit, and allegedly plays a pivotal role in the emissions scandal that has plagued the auto industry since Volkswagen defeat devices were revealed in 2015. The auto parts supplier developed the electronic diesel control that enabled GM to implement the defeat devices in its cars.

According to the plaintiffs, there are at least three defeat devices in GM’s Duramax diesel engines. The GM vehicles affected are model years 2011 to 2016 Silverado 2500HD/3500 HD trucks and Sierra 2500HD/3500HD trucks.

“GM turned a blind eye to the two-fold to five-fold increase in deadly nitrogen oxide emissions its scheme caused, all to drive up its sales and profits,” the plaintiffs state.

The named plaintiffs are Andrei Fenner, a Californian who bought a used 2011 GMC Sierra from an authorized GM dealer in 2013, and Louisiana resident Joshua Herman, who bought a new 2016 Silverado in June, allege violations of the Racketeer Influenced and Corrupt Organizations Act and states’ deceptive trade practice and consumer violations laws. They seek to represent a nationwide class on the RICO claim and state classes for the residents of California, Louisiana and other states.

The case is Fenner et al v. General Motors LLC et al., case number 2:17-cv-11661 in the U.S. District Court for the Eastern District of Michigan.

Go get ‘em! 

Top Settlements

Just Blowin’ that Whistle… Here’s an interesting tale. And the good guy won! A former employee who filed a wrongful termination lawsuit alleging he was let go by his employer after reporting illegal sale activity, has been awarded $22 million by the jury hearing his case.

Steven Babyak, who had worked from October 2012 to June 2015 as a sales manager for defendant Cardiovascular Systems Inc. (“CSI”), alleged he was let go from his job in June 2015 after acting as a whistleblower by revealing illegal kickbacks to doctors, as well as FDA policy violations and violations of the Sarbanes-Oxley Act (SOX).

The jury awarded a total award of $25,142,120, which includes economic damages regarding lost past and future earnings of $2,742,120, and punitive damages of $22,400,000.

The trial took just five days, during which time Babyak stated that as a result of complaining directly to CSI’s upper management about the alleged violations, he was immediately retaliated against.

When Babyak reported the alleged retaliatory behaviors and actions to CSI’s upper management, an investigation was launched, but CSI stated that they found “no evidence of retaliation” or wrongdoing by the company.

Several weeks after Babyak had reported his initial concerns and a resulting re-assignment of sales territory, he discovered new and additional legal violations which he reported to CSI’s regulatory department as a possible SOX violation. Upon hearing Mr. Babyak’s new complaint about possible SOX violations, CSI management became extremely displeased and even told plaintiff to stop reporting violations and to “get on the bus and move on.” Babyak then submitted a formal complaint outlining the SOX issue. Just weeks after his formal SOX complaint, CSI terminated Babyak.

Target on target to pay $18.5 million …in data breach class action settlement. Yup, the discount retailer will pony up the pennies to pay out 47 states in what is being touted as the largest multi-state data breach deal in US history. All stemming from the 2013 Target data breach, which happened just before US Thanksgiving… remember that?

Under the terms of the Target data breach agreement, Target must adopt improved measures to make secure customers’ information, including executive oversight of a comprehensive information security program, and hiring an independent third party to conduct a security assessment. The retailer must also update and maintain appropriate data encryption policies.

More than 41 million Target customer payment card accounts were affected by the massive 2013 data breach, with contact information compromised for more than 60 million customers. Shortly after the data breach became public, states’ attorneys general launched an investigation which found that hackers accessed Target’s server by using stolen credentials and exploiting weaknesses in its security systems.

Specifically, the investigation revealed that the hackers, after accessing a customer service database, were able to install malware in Target’s system that was able to capture the shoppers’ data, including full names, telephone numbers, email and mailing addresses, payment card numbers, expiration dates and encrypted debit PIN numbers.

Target announced the data breach in December 2013, stating that they were aware the breach had occurred between November 27 and December 15 2013, and confirmed that payment card data was stolen in real time as the cards were swiped in its stores. 

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

Week Adjourned: 5.19.17 – Walmart, Airbags, Pelvic Mesh Lawsuits

Top Class Action Lawsuits

Walmart Not on Board with Babies? Well actually moms-to-be. Yes, Walmart is back in the news again…this time, Walmart is facing a potential discrimination class action lawsuit alleging the world’s largest retailer discriminates against pregnant women.

Filed by Talisa Borders and Otisha Woolbright, the complaint claims Wal-Mart forced pregnant workers to perform tasks that employees with similar limitations were excused from.

Specifically, the Walmart pregnancy discrimination lawsuit states: “Under its constellation of policies and practices, Walmart accommodated a large percentage of non-pregnant employees with physical limitations but failed to accommodate a large percentage of pregnant employees with physical limitations arising out of pregnancy.”

The named plaintiffs seek to represent a class consisting of all pregnant women who worked as Wal-Mart employees and were denied accommodations between March 2013 and March 2014, the period during which the defendant issued a revision to its disability accommodation policy that changed how pregnancy was classified.

The lawsuit states that managers at Wal-Mart’s O’Fallon, Illinois, store where Borders worked, refused her request to follow her doctor’s advice and avoid climbing ladders and heavy lifting. Rather, Walmart placed her on unpaid leave, according to the lawsuit. When Borders returned to work, she was not reinstated to her old position in the store pharmacy but was instead assigned to a number of lower-paying positions, the complaint asserts.

Further, according to plaintiff Woolbright, who worked as an associate at a Jacksonville, Florida, location, she was denied permission to follow medical advice and avoid heavy lifting or a transfer to another position until she sustained an on-the-job back injury. Woolbright states she was terminated just three days after requesting information on the company’s childbirth leave policies.

According to the proposed class action, Walmart had a three-tier disability policy, up until March 2014, with employees who sustained on-the-job injuries, pregnant employees and employees with all other disabilities receiving different treatment.

“Wal-Mart’s policies and practices provided that the only modifications or adjustments available to pregnant employees were those that would be both ‘easily achievable’ and ‘which will have no negative impact on the business,’” the complaint states. “Non-pregnant employees with disabilities, on the other hand, were entitled to ‘reasonable accommodations’ so long as the change would not create an ‘undue hardship’ for the company.”

Consequently, Borders was denied ladder and lifting accommodations that were granted to employees with similar medical limitations from on-the-job injuries, and Woolbright’s accommodation was denied until she sustained her on-the-job injury, the lawsuit asserts.

The lawsuit states that while the potential class size is unknown, based on statistics, about 48,000 Wal-Mart employees would have become pregnant during the relevant period, meaning the number of denied accommodations is likely “several thousand.”

The case is Talisa Borders et al. v. Wal-Mart Stores Inc., case number 3:17-cv-00506, in the U.S. District Court for the Southern District of Illinois.

Top Settlements

Airbag Settlements… And so it begins—this week—$553.6 million in settlements were agreed in multi-district litigation (MDL) involving Toyota, Subaru, Mazda and BMW, which will see the automakers pay the sum to end claims brought by plaintiffs over alleged defective Takata airbags. To date, the airbags, which can explode, have been linked with 11 deaths in the US.

According to the terms of the airbag settlements, BMW of North America LLC will pay $131 million, Mazda North American Operations will pay $75,805,050, Subaru of America Inc. will pay $68,262,257 and Toyota Motor Corp., $278,500,000.

Some 15.8 million vehicles currently have the defective airbag inflators installed, and the settlement is meant to expedite their removal. Additionally, compensation will be provided to class members who suffered economic losses as a result from the Takata air bag recall, such as car rentals. Additionally, a customer support program will be initiated that includes an extended warranty.

More than nine million Toyota vehicles, 2.6 million Subaru vehicles, 2.3 million BMW vehicles and 1.7 million Mazda vehicles, are covered by the settlement, according to the plaintiffs.

The airbag settlements also provide compensation to class members for their economic losses resulting from the recall in the form of reimbursement for reasonable out-of-pocket expenses; a possible residual distribution payment of up to $500; requirements to provide rental cars to the most at-risk class members while they wait for their recall remedies; and the provision of a customer support program for repairs and adjustments on the replacement inflators, including an extended warranty.

Further, a new independent outreach program that seeks to dramatically increase recall remedy completion rates will be established. The program will regularly contact class members through direct mail, phone calls, email, internet ads and social media to educate them about the settlement and incentivize them to receive the recall remedy and exercise their rights under this agreement.

Toyota, Subaru, Mazda and BMW are the first automakers to exit the massive MDL, which covers the largest auto recall in US history.

The case is In re: Takata Airbag Products Liability Litigation, case number 1:15-md-02599, in the U.S. District Court for the Southern District of Florida. 

J&J to Pay after Mesh Verdict… What’s that expression—three strikes and you’re out? This week, a $20 million verdict was awarded against Johnson & Johnson (J&J) in punitive damages, in the third bellwether Ethicon pelvic mesh injury lawsuit, part of the pelvic mesh mass tort.

The 12-member jury hearing the case in Philadelphia returned the verdict after testimony was given by Plaintiff Margaret “Peggy” Engleman, demonstrating she suffered life-altering injuries when the mesh eroded inside of her. The mesh lawsuit verdict also includes a $2.5 million award for compensatory damages.

According to court documents, Engleman alleged she had underwent surgery to implant Ethicon’s TVT-Secur mesh to help with her stress urinary incontinence. However, just two months later, her doctor discovered erosions in the material. She claimed that the eroding mesh began causing her pain and she was eventually forced to undergo three additional surgeries, under anesthesia, to remove the material. However, portions of the mesh remain in her body and she has developed chronic pain and urinary dysfunction, according to court papers.

Engleman alleged that Ethicon’s TVT-Secur mesh was “defective in design, warnings and instructions” and that J&J released the product to market in full knowledge of the significant risk associated with the mesh implants, specifically, that the mesh would erode inside patients. 

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

Week Adjourned: 5.12.17 – Burger King, IHG Hotels, Volkswagen

Top Class Action Lawsuits

BK BOGO NOGO? Two for one costs more, according to the latest lawsuit to hit Burger King. This week, a consumer fraud class action lawsuit was filed by Koleta Anderson, who alleges the restaurant chain’s offer of Buy One Get One Free (BOGO) is misleading. She alleges that more than once she has paid more using a BOGO coupon to buy two Croissan’wiches than she paid for one. Maybe BK just can’t add? Yeah? No.

Anderson asserts in the proposed class action that the BOGO price was higher than the regular price. According to the lawsuit, at one Washington, D.C., Burger King Anderson paid $4.19 for two Croissan’wiches, using a BOGO coupon, but buying a single Croissan’wich at the same restaurant was just $1. She says she found similar discrepancies between the single price and the BOGO price at different Burger Kings in Maryland, Virginia, and Washington, D.C.

Typically, “Buy one, get one free” offers, which are not uncommon in the restaurant business, would imply that if a person buys one item for the regular price, they could normally expect to receive two of the items for the price of buying one. However, that is not the case, Anderson asserts.

“Burger King’s nationwide BOGO scheme is deceptive to reasonable consumers who expect that, when using a BOGO coupon at any retail store or restaurant, absent any exclusions or other terms and conditions, they will pay the same regular price for two identical Croissan’wiches as they would pay to purchase a single Croissan’wich,” the lawsuit states.

The Burger King class action lawsuit seeks to represent anybody who bought two Croissan’wiches using a BOGO coupon in Maryland, the District of Columbia, and Virginia.

The Burger King BOGO Class Action Lawsuit is Koleta Anderson v. Burger King Corp., Case No. 1:17-cv-01204, in the U.S. District Court for the District of Maryland. 

Staying at an Intercontinental Hotel Costing you more than the Room Charge? The international hotel chain got hit with a data breach class action lawsuit this week, alleging it failed to protect customer data resulting in a credit and debit card hack in 2016. The hackers allegedly stole private and valuable customer information over several months in 2016.

Filed in federal court in Georgia, by lead plaintiff David Orr, the lawsuit alleges breach of implied contract, negligence and unjust enrichment. Orr claims the U.K.-based hotel chain, which has in excess of 5,000 hotels worldwide, failed to take adequate steps to prevent the installation of malware on its payment system and failed to detect the security breach.

“IHG’s security failures enabled the hackers to steal plaintiff’s and class members’ private Information from within IHG’s hotels and subsequently make unauthorized purchases on their credit and debit cards,” the IHG lawsuit states. “The failures also put plaintiff’s and class members’ financial information and interests at serious, immediate and ongoing risk and, additionally, caused costs and expenses to plaintiff and class members attributable to responding, identifying and correcting damages that were reasonably foreseeable as a result of IHG’s willful and negligent conduct.”

According to the complaint, Orr stayed at an IHG Holiday Inn in Biloxi, Mississippi in October, 2016. During his stay he used his debit card to pay for his hotel room. His debit card contained private information, which was exposed due to IHG’s inadequate security.

On February 3, IHG announced that 12 of its locations had been affected by the data hack. Then, in April the company expanded the number of affected locations to over 1,000 and sent a data breach notification letter to affected customers, the lawsuit states.

The lawsuit seeks to represent a class of all consumers who used their credit or debit cards and were affected by the security breach at a hotel and time identified by IHG between September 29 and December 29, 2016.

The case is Orr v. InterContinental Hotels Group PLC et al., case number 1:17-cv-01622, in the U.S. District Court for the Northern District of Georgia.

Top Settlements

Do the VW Emissions Lawsuits ever end? For owners of VW 3.0 liter engines—they did this week. A US district judge hearing the Volkswagen AG emissions scandal lawsuits has said he will grant approval of a $1.2 billion settlement deal, effectively ending claims affecting VW’s 3.0-liter-engine vehicles.

The VW settlement is the latest in a series that total in excess of $17 billion. All the cases stem from the emission-cheating software installed in certain VW and Audi vehicles.

The settlement will involve 88,500 owners of VW 3.0-liter cars. Under the terms of a related consent decree with the US Department of Justice, the German automaker will pay $225 million to mitigate environmental effects of nitrogen oxide pollution.

This latest settlement follows the earlier $14.7 billion deal with owners of 2.0-liter vehicles reached in October 2016. That deal includes $2.7 billion for environmental remediation.

According to a statement issued by Department of Justice attorney Josh Van Eaton, who represented the US Environmental Protection Agency in the lawsuits, the consumer settlements of the VW emissions scandal is “the largest civil penalty ever under the Clean Air Act.”

The case is In re: Volkswagen “Clean Diesel” Marketing, Sales Practices and Product Liability Litigation, case number 3:15-md-02672, in the US District Court for the Northern District of California.

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

Week Adjourned: 5.5.17 – Honda CR-V, WEN, FedEx

Honda CR-V, Honda.com

Top Class Action Lawsuits

Honda in trouble—again? The got hit with a defective automotive class action lawsuit this week, over allegations of noxious fumes entering into the cabins of its 2015, 2016 and 2017 models of its CR-V sport utility vehicles. Sounds unpleasant, on a number of fronts.

The lawsuit also alleges Honda is guilty of consumer fraud, as it states the automaker knowingly sells cars with a defect causing the passenger cabin to fill with gasoline fumes. Honda has so far refused to take the cars back, or offer to replace or repair the vehicles.

According to the Honda CR-V lawsuit, new Honda vehicles come with a three-year or 36,000-mile warranty that provides free repairs or replacement of the vehicle for problems arising from defects in its design or construction. However, the plaintiffs state that when they complained to Honda about the alleged fumes, the company declined to honor the warranty. The plaintiffs claim the fumes are bad enough to keep them from driving the car, causing them to suffer headaches and stomach pain. They describe the smell as “intermittent and pungent” and doesn’t seem to be affected by the speed or duration of driving. The majority of the plaintiffs claim they first noticed it within a year of purchasing or leasing their CR-Vs.

“Plaintiffs and class members have no confidence and peace of mind in a manufacturer that continues to sell vehicles it knows reek of gasoline yet refuses to repair or replace as required by its warranty,” the lawsuit states.

According to the lawsuit, Honda has received hundreds of complaints regarding the fumes, dating back to July 2015. While Honda has acknowledged the problem, it said it does not know how to fix it.

The proposed class seeks to represent anyone who purchased a 2015, 2016 or 2017 CR-V, who complained to Honda about the leaking vapors, and who did not receive a repair or replacement of the car.

The lawsuit states that Honda is in breach of its own warranty and in violation of several state consumer fraud statutes. It seeks compensatory damages for the class.

The putative class is represented by Alexander Loftus of Stoltmann Law Offices PC. The case is Carol Miles et al v. American Honda Motor Co. Inc., case number 2017-CH-06331, in the Circuit Court of Cook County.

Top Settlements

Heads up! —pardon the pun—if you purchased WEN hair products. This week, a $26.25 million settlement was reached in a consumer fraud class action lawsuit pending against WEN by Chaz Dean Inc. and manufacturer Guthy-Renker LLC. The lawsuit alleged that the celebrity stylist’s hair products caused consumers’ hair to fall out.

In addition to hair loss, the plaintiffs alleged the WEN products contained sulfates when they were marketed as “sulfate-free.” Further, WEN and Guthy-Renker were aware of the problems for at least four years due to tens of thousands of customer complaints, yet issued no recall, according to the lawsuit.

The litigation has been going on for three years and involves, potentially, millions of customers. If the proposed settlement receives final court approval, WEN will be required to place a warning label on its Cleansing Conditioner.

The proposed WEN settlement establishes two avenues of compensation for class members: the first, a flat $25 refund for those who bought the products, and the second would be awards of up to $20,000 for those who used the product and experienced hair loss or scalp pain.

The settlement class covers consumers who purchased WEN hair care products between November 1, 2007, and August 1, 2016.

Final court approval is required.

The case is Amy Friedman et al. v. Guthy-Renker LLC et al., case number 2:14-cv-06009, in the U.S. District Court for the Central District of California.

FedEx to deliver—on unpaid overtime. Yup. This week, a $227 million settlement agreement received final approval ending an unpaid overtime class action lawsuit between FedEx Corp and its drivers in 19 states. The plaintiffs alleged they were misclassified as independent contractors by FedEx, rather than full time workers, and were therefore undercompensated.

According to FedEx settlement documents, 12,627 drivers are named as plaintiffs in class-action lawsuits in the 19 states. They will receive payouts ranging from $250 to in excess of $116,000, under terms of the separate settlements in each state.

Settlement distributions and resolution of the lawsuits under the terms laid out, are as follows:

Indiana: 791 drivers will divide a settlement of $33.95 million. Average recovery per class member will be $29,520. Settlements per driver may range from $250 to $116,028.

Alabama: 375 drivers will share a settlement of $3.2 million. Average recovery per class member will be $5,620. Settlements per driver may range from $250 to $20,100.

Arizona: 380 drivers will share a settlement of $4.95 million. Average recovery per class member will be $8,699. Settlements per driver may range from $250 to $28,149.

Georgia: 867 drivers will share a settlement of $4.94 million. Average recovery per class member will be $3,785. Settlements per driver may range from $250 to $13,711.

Louisiana: 315 drivers will share a settlement of $5.25 million. Average recovery per class member will be $11,061. Settlements per driver may range from $250 to $39,743.

Maryland: 533 drivers will share a settlement of $9.4 million. Average recovery per class member will be $12,047. Settlements per driver may range from $250 to $29,455.

Minnesota: 455 drivers will share a settlement of $8.3 million. The average recovery per class member will be $12,312. Settlements per driver may range from $250 to $44,701.

New Jersey: 901 drivers will share a settlement of $25.5 million. Average recovery per class member will be $19,301. Settlements per driver may range from $250 to $71,194.

New York: 1,602 drivers will share a settlement of $42.9 million. Average recovery per class member will be $18,421. Settlements per driver may range from $250 to $68,880.

North Carolina: 707 drivers will share a settlement of $20 million. Average recovery per class member will be $19,250. Settlements per driver may range from $250 to $53,440.

Ohio: 878 drivers will share a settlement of $8.35 million. Average recovery per class member will be $6,363. Settlements per driver may range from $250 to $20,611.

Pennsylvania: 1,265 drivers will share a settlement of $23 million. Average recovery per class member will be $12,442. Settlements per driver may range from $250 to $45,647.

Rhode Island: 125 drivers will share a settlement of $1.6 million. Average recovery per class member will be $7,352. Settlements per driver may range from $250 to $20,332.

South Carolina: 274 drivers will share a settlement of $3.1 million. Average recovery per class member will be $7,405. Settlements per driver may range from $250 to $19,682.

Tennessee: 762 drivers will share a settlement of $12.25 million. Average recovery per class member will be $10,863. Settlements per driver may range from $250 to $39,838.

Texas: 1,515 drivers will share a settlement of $8.9 million. Average recovery per class member will be $3,938. Settlements per driver may range from $250 to $13,880.

Utah: 171 drivers will share a settlement of $2.4 million. Average recovery per class member will be $9,130. Settlements per driver may range from $250 to $28,886.

West Virginia: 107 drivers will share a settlement of $3.75 million. Average recovery per class member will be $22,306. Settlements per driver may range from $250 to $76,456.

Wisconsin: 604 drivers will share a settlement of $5.5 million. Average recovery per class member will be $6,126. Settlements per driver may range from $250 to $21,842.

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