Week Adjourned: 12.1.17 – Toyota, Amazon, ADT

Top Class Action Lawsuits

Edible cars? Ask Toyota. They got hit with a proposed defective automotive class action alleging the car giant used soy-based materials in some of its wiring materials, which has attracted rats and mice – a meal too good to pass up? Apparently, because they rodents are  gnawing at the wiring, which require repairs that Toyota has so far refused to cover. And that’s hard fort car owners to swallow.

Filed by Plaintiff Ray Roscoe, the Toyota lawsuit claims that he was told by a Toyota dealership in December 2016 that an additional extended warranty he had purchased did not cover the extensive damage caused by mice on his 2012 Toyota Sequoia. This is because rodents are considered an “outside source of damage to the car”, even though the dealership has to retain a “mouse man” whose sole job is to repair the vehicle damage rodents cause, according to the complaint.

“The inclusion of soy-based materials in class vehicle electrical wiring and wiring components attracts rodents and other animals that nest under the hoods of class vehicles and feast on the soy insulation and electrical wires, thereby compromising the integrity of class vehicle electrical systems and rendering class vehicles fully or partially inoperable,” the complaint states.

The lawsuit goes on the state that complaints filed with the National Highway Traffic Safety Administration provide evidence that many consumers have experienced wire damage caused by rodents and other animals chewing the soy-based portions of the wiring in several Toyota models. Class vehicles include the 2009-2016 Camry, 2002-2016 Camry Hybrid and the 2014-2016 Corolla, among others.

Further, the lawsuit alleges Toyota must have been aware of the defect from the NHTSA records as well as various news reports and its own log of customers’ complaints, but nevertheless “routinely refuses” to repair the vehicles under warranty because it says rodent damage is an environmental problem.

“The environmentally friendly and less expensive soy-based coating is the problem,” the complaint states. “While class vehicles are essentially being attacked by rodents and other animals, older vehicles with non-soy-based insulated wires that are exposed to similar conditions do not experience rodent-caused damage.”

The plaintiff is seeking a minimum of $17,405.36 in damages to recoup the cost of repairs and a rental car he used while his car was in the shop. The proposed class is defined to include everyone in Massachusetts who owns or leases one of 17 Toyota vehicle models, which could involve “many thousand[s]” of class members, according to the complaint.

The case is Ray Roscoe individually and on behalf of all others similarly situated v. Toyota Motor Sales USA Inc., number 3:17-cv-12332 in the U.S. District Court for Massachusetts.

They’re working on it! Amazon employees that is… They filed an employment class action lawsuit against Amazon this week, alleging the online retailer fails to provide its fulfillment centers employees with rest breaks and overtime pay for shifts exceeding 10 hours in length.

Filed by named plaintiff Romeo Palma, who works for Golden State FC LLC, the business that operates several of Amazon’s fulfillment centers in California, the lawsuit asserts he and other workers haven’t received overtime wages, premium wages and timely and accurate wage statements as a result of working 10-hour shifts that don’t provide a requisite third rest break.

According to the Amazon complaint, workers’ duties include packaging, loading, unloading and other tasks. Further, workers are regularly scheduled for 10-hour shifts or more. Workers must walk through large warehouse facilities when they clock in and out of shifts, which can take several minutes, time they are not compensated for, according to the complaint. Further, they are not paid for the time it takes to travel to their location for work.

“This results in class members’ working on the clock more than 10 hours, when scheduled for a 10-hour shift, without receiving or being compensated for a third rest break, in violation of https California labor law”, the complaint states.

“The compensation for the third rest break, because it is for shifts exceeding 10 hours, must be at the overtime rate of one and a half time plaintiff and class members’ regular rate of compensation. Defendant’s failure to compensate plaintiff and class members for third rest breaks, as alleged herein, violated California law”, the complaint states.

Plaintiffs are seeking one hour of wages for each missed or uncompensated rest period, all unpaid overtime wages and liquidated damages on the overtime claim, statutory penalties and restitutionary disgorgement pursuant to the Unfair Competition Law.

The proposed class seeks to represent any California resident who worked for Golden State as a nonexempt employee in the past four years.

The case is Romeo Palma v. Golden State FC LLC d/b/a Amazon.com, in the Superior Court of the State of Sacramento. 

Top Settlements

Secure your ADT settlement payment! A $16 million settlement has received preliminary approval potentially ending a data breach class action lawsuit pending against home security company ADT.

According to the ADT lawsuit, ADT was negligent in securing its customers’ data, leaving it vulnerable to hacking. This settlement resolves claims brought in five separate ADT class action lawsuits filed between November 2014 and April 2016 in Arizona, California, Florida and Illinois.

Eligible class members include former and current ADT customers who, between November 13, 2009 and August 15, 2016, contracted with ADT or an ADT dealer for installation of a residential security system for at least one wireless peripheral sensor. Eligible class members can receive up to $45 from the settlement fund, once final approval is granted.

Under terms of the settlement, ADT will put up a $16 million in the fund to cover fees, court costs, incentive awards for the named plaintiffs, and costs of administering the settlement. Remaining settlement funds will be distributed among qualifying Class Members who submit valid and timely claims. Qualifying claimants will receive a larger payment if they contracted for installation of an ADT security system after July 23, 2014. Documents revealed in discovery show the wireless vulnerability at issue was brought to ADT’s attention as of that date. The higher payment reflects the greater strength of those Class Members’ claims.

The deadline to file a claim is February 26, 2018. A final fairness hearing is scheduled for February 2018.

The case is Edenborough v. The ADT Corporation and ADT, LLC d/b/a ADT Security Services, Case No. 16-cv-02233-JST, in the U.S. District Court for the Northern District of California.

So folks – on that happy note – this week’s a wrap –see you at the bar!!

Week Adjourned: 2.19.16 – Amazon, Maytag, Uber

amazon logoTop Class Action Lawsuits

Amazon Primed for a Lawsuit? How much was that again? Amazon got hit with a consumer fraud class action lawsuit this week, alleging false advertising and consumer fraud. Brought by named plaintiff Gregory Harris, the lawsuit claims Amazon charged Harris, and others similarly situated, fees that were additional to advertised products’ purchase prices. Heard this one before? Oh yeah baby!

Specifically, Harris claims that Amazon represents to consumers they can use its services to purchase products directly from its website at no cost to the consumer besides the cost of the product. However, the lawsuit alleges, Amazon.com charged Harris and others in the class additional fees, specifically an “Amazon Prime” membership fee.

The Amazon lawsuit claims violations of the Electronic Funds Transfer Act, violations of California’s Consumer Legal Remedies Act, and violations of California’s Unfair Competition Law.

Harris and others in the class seek injunctive relief, actual damages, punitive and statutory damages, interests, attorney fees and other costs of the suit. The case is: Superior Court of California County of Los Angeles Case number BC606984 

All Coming out in the Wash..? Round and round and round we go… what number lawsuit is this for Whirlpool? We’ve lost count. This consumer fraud class action lawsuit alleges the company misrepresents the efficiency of certain models of its washing machines.

Specifically, that Whirlpool promoted certain Maytag Centennial model washing machines as Energy Star-qualified, labeling the machines with the Energy Star logo. However, these washing machine models do not meet the Energy Star efficiency standards and in fact use more water and energy than stated on the labels. Oh, that’s great. So, just slap a sticker on and you’re good to go, is that the idea? Maybe…

According the Whirlpool Maytag lawsuit, the US Department of Energy requires that Energy Star-qualified washing machines must use approximately 50 percent less water and 37 percent less energy than standard models. However, the plaintiffs claim that he and others similarly situated paid more for these models but did not save as much as they should have on water and energy bills over time using the machines.

Filed by Walt Famular, individually and for all others similarly situated, the lawsuit alleges breach of express warranty, unjust enrichment, and violations of the New York General Business Law.

The lawsuit seeks statutory, compensatory and punitive damages, plus interests, restitution and disgorgement, injunctive relief, attorney fees and other costs of the suit. U.S. District Court for the Southern District of New York Case number 7:16-VC-00944-VB.

Plaintiffs are represented by attorneys Scott A. Bursor, Joseph I. Marchese, Frederick J. Klorczyk III and Neal J. Deckant of Bursor & Fisher PA in New York. 

Top Settlements

Uber Feeling the Sting…of high fees—in the form of a settlement, that is. The ride share and taxi company has agreed to pay $28.5 million to settle a consumer fraud class action lawsuit involving some 25 million riders who allege it mislead customers about its fees and safety procedures.

Specifically, the lawsuit claimed that Uber, which uses a smartphone app to receive ride requests and then sends the requests to its drivers, charged an extra “safe rides fee” to cover what the company called “industry-leading background checks” on its drivers.

Additionally, under the terms of the Uber settlement, Uber will not describe or title any fee that it charges for its services, including any charge for its rideshare services, as the “safe rides fee.” Further, the company agreed that it will not use the terms “best available,” “industry leading,” “gold standard,” “safest” or “best-in-class” in connection with its background checks, in any of its commercial advertising.

Uber has also agreed not to use the phrases “safest ride on the road,” “strictest safety standards possible,” “safest experience on the road,” “best in class safety and accountability,” “safest transportation option,” “background checks that exceed any local or national standard” or “safest possible platform” to describe its rideshare services.

Uber said it will rename the safe ride fee a “booking fee,” explaining that “It will be used to cover safety as well as additional operational costs that could arise in the future.”

Better buckle up! 

Ok…So, that’s a wrap folks… See you at the Bar!

Week Adjourned: 1.8.16 – FitBit, Amazon, Mini Cooper

fitbitTop Class Action Lawsuits

FitBit not as fit as it claims—apparently. The company is is facing a defective products class action lawsuit alleging the heart rate tracking technology in its fitness watches provides “wildly inaccurate” readings and doesn’t work properly during intense physical activity.

Filed in California by Kate McLellan, Teresa Black and David Urban, the FitBit lawsuit claims that FitBit Inc.’s PurePulse heart rate tracking devices, which are featured in two of the company’s fitness watches, “consistently mis-record heart rates by a very significant margin,” especially during exercise. And just when you thought you were doing so well…

The lawsuit further alleges consumer fraud in that the defendant fails to inform customers that the technology works properly only at low or resting heart rates. Instead, the FitBit lawsuit asserts, it depicts users in its advertisements relying on the trackers during intense physical activity. “The heart rate trackers are effectively worthless as heart rate monitoring devices,” the complaint says.

The complaint states, “This failure did not keep FitBit from heavily promoting the heart rate monitoring feature of the PurePulse trackers and from profiting handsomely from it. In so doing, FitBit defrauded the public and cheated its customers, including plaintiffs.”

Additionally, the plaintiffs allege FitBit’s attempt to bind all customers to an arbitration agreement and a class action ban is an unfair and deceptive trade practice and is “unconscionable, invalid, and unenforceable.”

The three named plaintiffs seek to represent a nationwide class of all customers who purchased a FitBit PurePulse tracker, excluding those who purchased their trackers directly from FitBit.com and who did not opt out of the arbitration agreement. They are also looking to establish three subclasses for consumers in California, Wisconsin and Colorado.

The case is McLellan et al v. FitBit, Inc., case number 3:16-cv-00036, in the U.S. District Court for the Northern District of California.

Amazon not Delivering? Amazon stands accused this week of not delivering on wages and overtime. The online retailer got hit with an unpaid wages and overtime class action lawsuit filed by a group of former delivery service workers who claim the online retailer in conjunction with Courier Logistics Services LLC failed to compensate them for overtime pay and pay them tips paid by customers for the deliveries, in violation of federal labor laws.

The Amazon lawsuit was filed by plaintiffs Daniel Curry, Becky Lawrence, Nicholas Mason and Tyechia Webb, all of whom worked in Arizona for Courier Logistics, which is in exclusive contract with Amazon to deliver packages ordered through its newer same-day service. The suit asserts that the plaintiffs have been denied proper overtime wages as defined by the Fair Labor Standards Act (FLSA). Further, they were not given the full amount of tips they should have received from delivery customers.

According to the complaint, during the past several years Courier Logistics has had a “consistent policy” of requiring its employees to work nearly 50 hours per week without paying the legally required time-and-a-half overtime wage. Additionally, the lawsuit states that certain employees were misclassified as independent contractors.

The plaintiffs contend that Courier Logistics’ delivery employees are not independent contractors because they are required to show up for work at a scheduled time every day, are paid by the hour, are assigned work and are not allowed to refuse any deliveries.

According to the suit, as joint employers that shared employee-based decisions, Amazon and Courier Logistics “had complete control over the manner in which plaintiffs would complete their work.”

The plaintiffs are looking to recover all unpaid overtime wages, overpayment of income taxes and statutory penalties, along with other unspecified damages and attorneys’ fees. Go get ‘em!

The case is Curry et al. v. Amazon.com Inc. et al., case number 2:16-cv-00007, in the U.S. District Court for the District of Arizona.

Top Settlements

Mini Cooper…Not so Mini Settlement. A $30 million settlement has been tentatively approved potentially ending a defective automotive class action lawsuit filed against BMW North America. The class action asserts that the engines in its Mini Coopers are defective.

The lawsuit asserts that vehicle owners were forced to pay thousands of dollars in repairs and replacement costs for a defect in the engine which caused the cars to abruptly stop without warning. The proposed class action, filed in March 2013, involved certain Mini Cooper S Hardtops, Clubmans and Convertibles from model years 2007 to 2010, according to court papers.

The backstory… In the lawsuit, named plaintiffs Joshua Skeen and Laurie Freeman state they both bought new Mini Cooper S models in 2007. They alleged problem was a defect in the vehicles’ timing chain tensioner, which maintains an appropriate tension of the engine’s timing chain. The timing chain controls the timing of the engine’s valves, but when the chain doesn’t have proper tension or synchronization, the engine’s pistons and valves collide with great force and the engine components suffer so much damage that the engine seizes and the vehicle loses all power, according to the complaint.

Skeen and Freeman allege that while the Mini Cooper timing chains are meant to last about 10 years or 120,000 miles, they encountered problems with their engines far sooner than expected.

According to the terms of the settlement, the reimbursement amounts for each class member will see BMW paying for out-of-pocket expenses incurred prior to the settlement, including full costs incurred at authorized Mini dealers and up to $120 for timing-chain tensioners and $850 for timing chains repaired or replaced at independent service centers.

Class members will be entitled to up to $4,500 in out-of-pocket expenses incurred before the settlement to repair or replace an engine due to the problems addressed in the lawsuit, according to the opinion, and those who had to sell their vehicles at a loss before the settlement will get up to $2,250. Compensation amounts are subject to changes because of mileage discounts and other limitations, the opinion states. The final amount of the settlement will depend on the number and nature of claims submitted by the Class.

Additionally, class members will receive a warranty extension for the timing-chain tensioner and timing chain for seven years or 100,000 miles from the date when the vehicle was first placed into service, whichever comes first.

The case is Joshua Skeen et al. v. BMW of North America LLC, case number 2:13-cv-01531, in the U.S. District Court for the District of New Jersey.

Ok—that’s it for this week folks—see you at the bar! Oh—and Happy 2016!!

Week Adjourned 10.30.15 – Amazon, Anthem Blue Cross, CVS

amazon logoTop Class Action Lawsuits 

Amazon not Ready for Prime Time? Amazon’s Prime Now “Instant gratification market” is great for everyone but the delivery guys, according to a lawsuit filed against the online retailer this week. Amazon got hit with a proposed employment class action lawsuit filed by drivers delivering its products, specifically, drivers delivering goods within two hours of being ordered through Amazon’s “Prime Now” app.

According to the lawsuit, the drivers have been classified by Amazon and the companies providing services to Amazon as independent contractors. Ok—who doesn’t know this one by chapter and verse….Predictably, the drivers allege that have been misclassified.

According to their lawsuit, they deliver tens of thousands of items to Amazon’s Prime Now customers based on orders placed on Amazon’s Prime Now mobile app, which is aimed at what is referred to as the “instant gratification market.” But everything has its price.

So, to cut to the chase, the Amazon Prime driver complaint, filed October 27, 2015, in Los Angeles County Superior Court names Amazon.com, Inc., Scoobeez Inc., and ABT Holdings, Inc. as defendants. The four named plaintiffs asserts that they and others similarly situated to them were hired by Scoobeez, a courier company operated by ABT Holdings, to work exclusively for Amazon.com’s Prime Now two-hour delivery service in Orange County, California.

The specific allegations are that the app suggests a $5.00 tip for drivers (which they claim they have not received in whole or in part); that the drivers receive multiple days of training in making Amazon Prime Now deliveries; that they are scheduled to work fixed shifts, arrive at a designated warehouse ahead of the shift time and check in with a dispatcher; that they are sent home if there is not enough work for them; that they cannot reject work assignments or request particular geographical areas; that they must follow specific rules or instructions and are subject to discipline or termination if they do not; that they are required to deliver packages in a set sequence determined by the defendants; that the Prime Now app generates routes and directions; that they cannot deliver packages either two minutes too early or too late; that they are required to ask customers to fill out customer surveys; that the rates are unilaterally determined by the defendants, who reserve the right to change the compensation terms at any time; and that the delivery drivers are required to use their own vehicles and pay for their own vehicle and transportation expenses.

The plaintiffs claim violation of an array of state laws governing employees, including those requiring the payment of minimum wages, overtime, reporting pay, expense reimbursement, and meal periods, all of which they claim entitlement to because they are allegedly employees and not actually independent contractors.

The case is Truong v. Amazon.com, Inc., No. BC598993 (Cal. Sup. Ct. Los Angeles County, Oct. 27, 2015). 

Top Settlements

Anthem Blue Cross caught with their pants down… has agreed to an $8.3 million settlement ending a bad faith insurance class action. The settlement could affect some 50,000 California customers.

The Anthem Blue Cross settlement will resolve two lawsuits that were filed by Anthem policy holders in 2011, alleging the state’s largest for-profit health insurer increased annual deductibles and other yearly out-of-pocket costs on individual policies in the middle of the year, which was a breach of contract and represented unfair business practices.

The lawsuit states that, in the case of plaintiff Dave Jacobson, the rate hikes amounted to a yearly out-of-pocket maximum increase from $5,000 to $5,850. His annual prescription drug deductible increased to $275 from $250.

According to the terms of the settlement, Anthem Blue Cross will mail notices to affected customers and to post information about the agreement on a public website. Only consumers affected by the midyear policy changes will receive settlement checks, but all Californians enrolled in individual Anthem health plans will be subject to the agreement that prevents such cost increases in the future.

Checks will be mailed in December to 50,000 consumers. The average amount will be $167. The four named plaintiffs in the court case will receive an additional $10,000, subject to court approval. So, watch the mail folks.

A fair shake for Pharmacists… in the guise of a $7.46 million settlement recently agreed in an unpaid overtime lawsuit pending against CVS Pharmacy. The settlement will end claims made in three separate but related class action lawsuits that CVS failed to pay overtime wages; failed to provide timely, accurate, itemized wage statements; failed to pay earned wages upon discharge; conversion; and unlawful and/or unfair business practices in violation of California labor law.

The CVS lawsuit asserts that pharmacists who work more than six days in a row are entitled to overtime pay for work beyond the sixth day, regardless of how CVS defines its work week.

The CVS settlement effects all persons who are or were employed by CVS as non-exempt pharmacists in Regions 54, 65 and/or 74 in the State of California, and who worked more than six consecutive days of work without overtime pay from October 2, 2009 through April 30, 2015 (Connell, Region 65), October 4, 2009 through April 30, 2015 (Paksy, Region 54), and October 29, 2009 through April 30, 2015 (Bystrom, Region 75).

A separate settlement was reached in a similar class action lawsuit (Rimanpreet Uppal v. CVS Pharmacy Inc.) involving California’s Region 73.

Class Members will be paid based on the number of “Compensable Workweeks” in which they worked more than six consecutive days without overtime pay.

Despite denying the allegations, CVS agreed to settle the class action lawsuits to avoid the risk and expense of proceeding to trial. KA-Ching… better to pay your staff… right? Now that’s money well spent. 

Ok – That’s a wrap folks… See you at the Bar!

Week Adjourned: 1.31.14 – Amazon, OxyElite, Hyundai

The week’s top class action lawsuits and settlements including Amazon wag and hour lawsuit, OxyElite weight loss and Hyundai gas mileage.

amazon logoTop Class Action Lawsuits

Discount Wages as Well as Products? Well, we’re about to find out. Amazon got hit with an employment class action lawsuit filed by Plaintiff Kelly Pavuk (“Pavuk”) (Case No. 2013-11565-0, in the Luzerne County Court of Common Pleas) who alleges Amazon failed to compensate her adequately for time working at the Amazon facility in Pennsylvania. Pavuk makes this claim on behalf of herself and other similarly situated.

Specifically, the Amazon lawsuit claims the defendants failed to comply with the requirements of the Pennsylvania Minimum Wage Act (“PMWA”), thereby violating the PMWA by not compensating all Warehouse Workers during the end-of-shift screening process that “approximately takes between 10 and 20 minutes, and, with delays … can last longer.”

Further, the lawsuit claims the defendants violated the PMWA by not compensating all Warehouse Workers for passing through the same screening process during meal breaks or for walking to that screening area. And, the lawsuit claims the defendants “automatically deduct 30 minutes from Warehouse Workers’ compensable time each shift for an unpaid meal break,” “require Warehouse Workers to remain at their work locations within the Facility until the start of the purported 30-minute meal break,” and that “[a]fter the start of the 30-minute meal break, Warehouse Workers walk to the [Facility’s] time clocks and clock-out.”

Okee dokee. One to watch.

OxyElite “light” on the Facts… including possible liver injury? A proposed defective products class action lawsuit has been filed against General Nutrition Center Holdings Inc., and USPLabs LLC, alleging OxyElite Pro energy and weight loss dietary supplements cause liver damage.

Filed by Sandeep Barot, the OxyElite lawsuit (U.S. District Court for the District of New Jersey at Camden case number: 1:14-cv-000562) claims that OxyElite Pro is intended to safely provide weight loss, energy and mental focus, however, it instead causes severe adverse health effects.

The OxyElite complaint alleges that USPLabs sells a variety of energy and weight loss and dietary supplements under the brand name of OxyElite Pro through GNC, which are dangerous, sold pursuant to deceptive and unfair practices and are not fit for their intended purpose.

Barot claims that he and all others similarly situated “did not bargain for a product that causes adverse health effects in exchange for their payment of purchase price,” according to the lawsuit. And the lawsuit goes on to state that several adverse reactions, including serious liver injury and wrongful death, have been reported from consumers who have purchased and ingested the product.

According to the complaint, USPLabs and GNC had actual knowledge of the product’s shortcomings, but both failed to timely act to adequately warn consumers of the unfitness of the product, the extreme adverse side effects associated with the product or provide adequate relief to the class of consumers who purchased the product.

Further, On October 11, the US Food and Drug Administration issued a warning letter to USPLabs regarding OxyElite Pro for its inclusion of aegeline or dimethylamylamine, known as DMAA, the lawsuit states.

Barot claims that he purchased the product based on claims made by the manufacturer that the products would safely produce energy, increase weight loss and increase mental focus so long as the consumer used the product as directed. However, Barot alleges he suffered economic damages as a result of purchasing and using the product. Further, he claims that neither himself nor any other reasonable consumer would have purchased the product had they known about the severe adverse effects the product can cause to humans, the lawsuit states.

The lawsuit alleges that the defendants are in violation of the New Jersey Consume Fraud Act and was unjustly enriched at the plaintiffs’ expense.

Um, back to diet and exercise, I guess…

Top Settlements

Hyundai Canada to Shell out Cash for False Mileage Claims. This week, the automaker announced that it has entered into an agreement with plaintiffs in Canada—representing current and former owners and lessees of vehicles affected by the auto company’s November 2012 restatement of fuel economy ratings. The adjustment affected approximately 130,000 Hyundai 2011-2013 model year vehicles, increasing their combined city/highway fuel consumption by 0.2-0.8 L/100km. While today’s agreement is valued at up to $46.65 million in cash compensation plus other available options, that number is dependent on how many customers elect to participate in the settlement’s one-time lump sum payment option or remain in the existing reimbursement program Hyundai introduced at the time of the restatement.

At the time of the restatement, Hyundai provided a reimbursement program to cover the additional fuel costs associated with the rating change—plus a 15 percent premium in acknowledgement of the inconvenience—to customers for as long as they owned or leased an affected vehicle. Affected owners and lessees are compensated based on their actual kilometers driven and the fuel costs for the region in which they live.

Under the terms of the proposed settlement, a single lump sum payment will be provided as an option to the original reimbursement program. The lump sum payments will vary by type of vehicle, and will be reduced for any amounts already received through Hyundai’s existing reimbursement program. For example, an individual owner who purchased a new 2012 Elantra would receive a lump sum payment of $361, minus any previous reimbursement payments. Affected Hyundai owners may elect the one-time lump sum cash payment or remain in the auto company’s ongoing reimbursement program for as long as they lease or own the affected vehicle; the choice is theirs. Consumers can also elect other options, such as a dealership credit of 150 percent of the lump sum cash payment amount, or a credit of 200 percent of the cash amount toward the purchase of a new Hyundai vehicle.

Courts in Ontario and Quebec are expected to review the agreement for approval in early 2014. Assuming approval is granted, notices will then be provided to all affected customers.

Hopefully the snow will have stopped by then—and the roads will be driveable!

Ok Folks, That’s all for this week. See you at the bar!

Week Adjourned: 8.12.11

Top Class Actions

Latest Book Club? Apple, and some the publishing industry’s biggest names got hit with a nationwide antitrust class-action lawsuit this week, over allegations that they conspired to fix prices in electronic books (e-books)–at least that’s the short version.

According to published info, Apple Inc., HarperCollins Publishers, a subsidiary of News Corporation, Hachette Book Group, Macmillan Publishers, Penguin Group Inc., a subsidiary of Pearson PLC, and Simon & Schuster Inc., a subsidiary of CBS, colluded to increase prices for popular e-book titles to boost profits and force e-book rival Amazon to abandon its pro-consumer discount pricing. Nice!

Here’s the skinny: the publishers believed that Amazon’s enormously popular Kindle e-reader device and the company’s discounted pricing for e-books would increase the adoption of e-books, and feared Amazon’s discounted pricing structure would permanently set consumer expectations for lower prices, even for other e-reader devices.

So, according to the lawsuit, the five publishing houses forced Amazon to abandon its discount pricing and adhere to a new agency model, in which publishers set prices and extinguished competition so that retailers such as Amazon could no longer offer lower prices for e-books. That’s anti-free market for sure!

If Amazon attempted to sell e-books below the publisher-set levels, the publishers would simply deny Amazon access to the title, the lawsuit states. The defendant publishers control 85 percent of the most popular fiction and non-fiction titles. Lawyers for the plaintiffs note that while Amazon derived profit from the sale of its Kindle and related accessories, likely allowing the company to discount e-books, Apple was steadfast in maintaining the 70/30 revenue split it demanded with its App Store.

Still with me? Read on…

While free market forces would dictate that e-books would be cheaper than the hard-copy counterparts, considering lower production and distribution costs, the complaint shows that as a result of the agency model and alleged collusion, many e-books are more expensive than their hard-copy counterparts.

As a result of the pricing conspiracy, prices of e-books have exploded, jumping as much as 50 percent. When an e-book version of a best-seller costs close to—or even more than—its hard-copy counterpart, it doesn’t take a forensic economist to see that this is evidence of market manipulation, lawyers for the plaintiffs note. For example, “The Kite Runner” costs $12.99 as an e-book and only $8.82 as a paperback.

The lawsuit goes on to claim that because no publisher could unilaterally raise prices without losing sales, they coordinated their activities, with the help of Apple, in an effort to slow the growth of Amazon’s e-book market and to increase their profit margin on each e-book sold.

The lawsuit claims Apple and the publishers are in violation of a variety of federal and state antitrust laws, the Sherman Act, the Cartwright Act, and the Unfair Competition Act.

Once approved, the lawsuit would represent any purchaser of an e-book published by a major publisher after the adoption of the agency model by that publisher.

Does this affect you?

Top Settlements

Pharma Sales Reps Score One—in Overtime. Well now—here’s a great big slice of sunshine for all those hardworking pharmaceutical representatives. Schering Plough’s reps have won a complete victory in Federal Court in a nationwide collective lawsuit alleging unpaid overtime pay at the mandatory rate of time and one half. The federal class action was filed on behalf of all pharma reps who worked for SP during the last three years, anywhere in the United States.

No numbers have been made public as yet—but the press release states “The amount to be distributed to the class will be determined by the Court, but will likely include double damages for the violation.”

Apparently, the US Department of Labor recognizes that pharmaceutical reps are not exempt from overtime pay, and that the precedent for the class claim was set in the U.S. Court of Appeals for the Second Circuit, which found earlier this year that Novartis pharma reps  were entitled to overtime compensation on the same grounds alleged against Schering Plough.

The US Supreme Court refused to hear the drug companies’ appeals. Saving tax payer dollars—always a good thing. The Second Circuit issued a similar ruling in a case brought by pharma reps against Schering Plough, as have district courts in Connecticut, Illinois, Florida and Texas in cases against Boehringer Ingelheim, Abbott, and Auxilum Pharmaceuticals. However, this ruling is the first of its kind as it found that pharma sales reps are not exempt under any of the parts of the exemption. Schering had to prove all the parts of the exemption, but it lost on all points.


$5 Million Drunk Driving Accident Judgment. I wonder how many people are affected by drunk drivers? This guy certainly was. Twenty-two year old Dwight Grant—he was 22 in 2007 at the time of the incident—sustained brain damage as a result of an accident caused by a drunk driver. He was recently awarded $5 million in settlement of his personal injury lawsuit.

Apparently, he was a passenger in stopped vehicle when the vehicle was struck by Mathew Lyons who was being chased by the police. After hitting the car Grant was in, Lyons fled the scene.

Grant suffered fractures to his face and skull, which resulted in his sustaining brain damage, specifically, damage to his frontal lobe. This damage, Grant alleged, caused him a seizure disorder that now requires constant care.

The parties ultimately agreed to a $5 million final judgment.

OK. That’s it for this week. See you at the Bar—I’m taking a taxi.


Week Adjourned: 7.31.09



orwells-paperback-1984Another busy week…


Top Class Actions

“A startling view of life in…2009?” If only the Amazon Kindle had been around when I went to school! A 17-year old has filed a lawsuit against Amazon claiming the company rendered his homework useless when it went into this Kindle and deleted the digital version of George Orwell’s 1984 (gotta love the irony there).


Justin D. Gawronski , the 17-year old, alleges that Amazon never indicated to its customers that it had the ability to remotely delete content from Kindles and iPhones. The suit further alleges that this information is relevant to customers when making a decision about whether or not to purchase a Kindle. If this all sounds very familiar—well, that’s because it is. Amazon was hit with a similar class action 2 weeks ago when it originally deleted Orwell’s classics, alleging trespass.


Apparently Gawronski’s notes for his homework assignment on 1984 were not only stored in the Kindle, they were linked to specific passages in the book. When the book was deleted his notes became worthless. Uhmm. I wonder if this precedent could be applied to income tax documents…


“Wiiilllllmmmaa…!!!!” No, it wasn’t Fred Flintstone calling, but regardless, seems Hartford Insurance may not have heeded the call when policy holders’ filed claims after Hurricane Wilma. Hartford is being sued for not reimbursing its policy holders who made claims as a result of damage caused by the hurricane—unless those customers actually replaced the damaged item(s).  Continue reading “Week Adjourned: 7.31.09”

Week Adjourned: 7.17.09

glasscrackedSo much for the lazy days of summer—it’s been a busy week!

Top Class Actions

Kindle cracking up? Unfortunately that’s not in a “ha-ha” kind of way. An unhappy customer in Seattle filed a federal class action lawsuit against online bookseller Amazon, this week, over his cracking Kindle.

A Kindle, for those of us technophobes, is an electronic book reader, and has proved tremendously popular for a variety of reasons. Mathew Giese is a convert, he bought a Kindle 2 in February, and a protective cover for it. After 3 months of use his Kindle started to crack in the areas where the cover was attached. The cracks grew worse until one day the screen froze and the Kindle seemingly stopped working.

When Geise contacted Amazon to make warranty claim, he was told by a company representative that Amazon would cover the cost of the frozen screen, but not the cracks, as the warranty apparently doesn’t include damage made by the protective cover. To make a long story short, Mr. Giese was told that the repairs would cost $200.  Yes, you read that correctly. And did I mention that you can get a new Kindle 2 for $299? Continue reading “Week Adjourned: 7.17.09”