Week Adjourned: 3.27.15 – Dominos Pizza, Wen Haircare, AIG

DominosTop Class Action Lawsuits 

Heads up you pizza delivery folk!! Another proposed wage and hour class action lawsuit has been filed against 70 Domino’s Franchises stores, this time in California and Arizona, by a delivery driver who alleges Domino’s fails to reasonably reimburse drivers for the costs of using personal vehicles for work, in violation of the federal Fair Labor Standards Act (FLSA) and California labor laws.

Field by driver Derek Gibbins, the Dominos delivery lawsuit alleges franchise operator Hishmeh Enterprises Inc. uses a flawed method to determine reimburse rates. Specifically, it typically pays $1 per trip whch that does not accurately reflect costs incurred by drivers.

The complaint further claims that Hishmeh’s “systematic failure” to provide adequate reimbursement constitutes a “kickback” such that hourly wages paid to its drivers are not free and clear, resulting in net wages that fall beneath federal and state minimum-wage requirements in violation of the FLSA and state labor codes.

“The net effect of defendant’s flawed reimbursement policy is that it willfully fails to pay the federal and state minimum wage to its delivery drivers,” according to the complaint filed in California federal court. “Defendant thereby enjoys ill-gained profits at the expense of its employees.” Otherwise known as screwing your employees—allegedly.

The complaint alleges all Hishmeh drivers have similar experiences because they operate under the same reimbursement policy. The suit seeks to include an estimate of several hundred current and former Hishmeh delivery drivers in California over the past four years. 

Wen will my hair stop falling out? Wen you stop using the product, although this has yet to be established. Wen Hair Products and marketing company Guthy-Renker got hit with a defective products class action lawsuit this week over allegations the line of products cause hair loss. Oh. Not so good.

The Wen haircare lawsuit, filed by women living in Florida, Hawaii, Indiana, Minnesota, New Jersey and North Carolina, the plaintiffs all allege they have suffered severe hair loss after using ‘Wen Hair Products’.

The Wen line of products is designed, manufactured and sold by Chaz Dean, a Hollywood hair stylist, and Guthy-Renker. The defendants claim that the Wen hair products condition the hair, and limit or repair damage caused by regular hair treatments and daily styling. However, not advertised is the alleged severe and possibly permanent damage to hair, including hair loss to the point of visible bald spots and severe breakage, according to the plaintiffs.

According to the lawyer representing the plaintiffs, many of the women who have suffered damage called the companies for help, only to be told that their complaints were unusual. However, the companies had received prior, similar calls, which they did not disclose. You think? 

Top Settlements 

And the fallout from the 2008 mortgage-backed securities financial crisis continues… this week with final approval of a $970.5 million settlement granted by a judge for the US District Court for the Southern District of New York. Yes folks, this effectively ends the securities litigation brought by shareholders of the insurance giant American International Group (AIG). Remember them?

The securities lawsuit alleged that AIG misled investors about the subprime mortgage exposure that led to a liquidity crisis and over $180 billion in federal bailouts, to put is very simply. The investors alleged AIG failed to disclose risks it took on through its portfolio of credit default swaps and a securities lending program, leading them to buy stocks they otherwise would not have bought.

This settlement is among the largest class-action settlements to result from litigation of mortgage-backed securities and the 2008 financial crisis. The judge noted that no potential class member objected to the terms of the deal, leading her to determine it was “fair, reasonable and adequate.”

The settlement affects shareholders who bought AIG securities from March 16, 2006, to September 16, 2008. 

Hokee Dokee—That’s a wrap folks…Time to adjourn for the week.  See you at the bar!

Week Adjourned: 12.30.11

A weekly wrap up of class action lawsuits and settlements for the week ending December 30, 2011.

Top Class Actions

Neiman-Marcus Class Action Filed Over $1.50. That’s one dollar fifty cents, folks. This is interesting–and I have to admit I’d never thought about ATM fees in department stores. But this woman has–Marilyn Frey, from Sherman, Texas. She has filed a consumer fraud class action against Neiman-Marcus claiming unfair business practices over its charging $1.50 ATM fees at ATM terminals in their stores, without posting the fees. Umm. Ok.

The lawsuit, brought individually and on behalf of others similarly situated, claims that Frey made a withdrawal at an ATM on October 11, 2011, which is operated by Neiman-Marcus in their store, and was charged a “terminal fee” of $1.50 in connection with the transaction. The lawsuit claims that the fee is in violation of the Electronic Fund Transfer Act, which requires a notice posted on or at the ATM regarding the fee that would be charged for use. Well, this could certainly open up a can of worms…all this for $1.50.

Top Settlements

A couple of biggies this week…

AIG Low-balling Workers’ Comp Claims. First up—American International Group Inc (AIG)—they received final approval from a federal judge to pay $450 million as settlement of the AIG class-action lawsuit brought by a group of other insurers alleging underreporting of workers compensation premiums.

The settlement is supported by AIG and Ace Ina Holdings Inc., Auto-Owners Insurance Co., Companion Property & Casualty Insurance Co., Firstcomp Insurance Co., Hartford Financial Services Group Inc., Technology Insurance Co. and Travelers Indemnity Co. Liberty Mutual Group’s two subsidiaries, Ohio Casualty and Safeco, had opposed the settlement. In August, the U.S. Court of Appeals for the Seventh Circuit denied Liberty Mutual’s request to appeal the proposed $450 million settlement while the case is still ongoing. Liberty Mutual could still file an appeal down the road, and can still drop out of the settlement class to pursue a case against AIG on its own.

The lawsuit stems from allegations that AIG intentionally underestimated its workers’ comp premiums to avoid premium taxes and substantial residual market charges before 1996. In some states, from the mid-1980s to the mid-1990s, the residual market losses were greater than the residual market and voluntary market premium combined, so the more voluntary premium a company wrote, the more it had to pay out to cover its share of the residual market losses. That, allegedly, gave companies an incentive to under-report workers’ comp claims. Got it? Hey—fraud is fraud…

Look Sharp? Next up…A $538.6 million settlement has been agreed between Sharp Corp., Samsung Electronics Co. (005930) and five other makers of liquid crystal display panels which, if approved, would end claims that the companies fixed prices on the panels used in computers and televisions. The attorney generals of eight states, including California, Florida and New York are part of the settlement agreements with the manufacturers.

In a nutshell—the antitrust lawsuit alleged that the companies fixed prices of thin-film liquid crystal display panels, between 1999 and 2006, which effectively increased the prices for purchasers of devices such as televisions, notebook computers and monitors.

How is a consumer supposed to know this stuff? Oh right, we’re not. All things considered maybe the term “trust” should be stricken from terminology relating to the free market… just a thought…

Apparently, this settlement will see about $501 million made available for partial refunds to consumers and about $37 million made available for compensation to governments and other public entities for damages.

Ok—That’s a wrap for this year. Happy New Year and all that jazz. See you in 2012!

Week Adjourned: 7.23.10

Top Class Actions

HiPhone, HiPhone, it’s Off to Court we Go…Well, all you iPhone enthusiasts are clearly disappointed with the new iPhone 4 and its apparent lack of receptivity—would that be an appropriate term to describe an alleged antenna design flaw?

Let’s get to the point. Apple and AT&T got hit with a class action lawsuit filing this week, “seeking relief for consumers who purchased iPhone 4 cellular phones.” 

To be blunt, the only way you could not know about the iPhone 4 antenna problem is if you live on another planet—or in a cave in some remote corner of the world that is not part of AT&T’s network. No doubt all you diehard Blackberry fans must be lovin it!

According to the complaint, the new iPhone 4 sold 1.7 million in its first week of sales, a figure that reportedly comes from Apple. That’s a loyal fan base. And woe betide you if you piss them off. 

Here’s the skinny—”the phone retails for $199.00 for the 16GB model or $299.00 for the 32GB model with a 2-year contract (or $599.00 16GB / $699.00 32GB without a contract). Users pay Continue reading “Week Adjourned: 7.23.10”