Price Fixing

Week Adjourned: 3.20.15 – Homejoy, Target, Drywall Pricing

Top Class Action Lawsuits

Uhh…Maybe not Everyone Deserves a Happy Home? You’d think with a name like ”Homejoy Inc”, there’d be a lot of joy to go around. Well, maybe for the customer and business owners, but maybe not so much for the workers. The company is facing two potential employment class action lawsuits, alleging the company is in violation of California labor laws.

The house-cleaning business allegedly fails to pay its workers minimum wage or overtime, denies workers legally mandated breaks and requires house cleaners to incur their own business-related expenses, among other infractions, according to one lawsuit. Specifically, the lawsuit claims Homejoy misclassifies its workers as “cleaning professionals”–as independent contractors–rather than employees.

Additionally, the lawsuits allege Homejoy workers must wear a shirt with the Homejoy logo on it while servicing homes and can be subject to “performance improvement plans” if their ratings are too low. The complaints further claim that “cleaners are an integral part of Homejoy’s business of providing cleaning services, among other services, to its customers.”

The plaintiffs are seeking damages in the amount of unpaid overtime compensation, unpaid minimum-wage compensation, unpaid reimbursed business expenses, one hour of additional pay for each workday completed without meal breaks and another hour of compensation for each work day without rest breaks” all with interest. The Private Attorneys General Act action seeks civil penalties and attorney fees. Go get’em!

Top Settlements

Heads up all Target Customers: A $10 million settlement has been reached in the Target data breach class action lawsuit. If approved, the settlement will resolve multidistrict litigation (MDL) resulting from one of the largest data breaches to date, affecting as many as 110 million Target customers.

The data breach occurred late in 2013—one of many data breaches we’ve been reporting on recently—and compromised customers’ personal information including bank and debit card information. The settlement motion requests certification of a nationwide class of an estimated 110 million consumers whose credit or debit card information or other personal information was compromised following the breach.

If you ever needed a reason to keep your paperwork—this would be it. Under the terms of the proposed settlement, affected Target customers who can document their losses will be eligible for up to $10,000 in damages. For those who cannot produce documentation, a payment will be made from the remainder of the settlement fund, once outstanding costs are deducted. The remaining balance will be divided equally.

Additionally, the agreement stipulates that Target makes a greater effort to safeguard its customer data, which would include appointing a high-level executive as chief information security officer and maintaining a written information security program, as well as a process to monitor for information security events and to respond to any such events determined to present a threat.

Well, the proof is in the doing… we can only wait and see.

Sheetrock Settlement. A $55 million settlement has been reached in an antitrust multi-district litigation (MDL) alleging price-fixing among companies that make gypsum board, commonly called drywall, sheetrock or plasterboard. While that might seem like a lot for drywall—it’s reportedly a $5 billion dollar a year industry in the US.

Preliminary approval was granted by US District Senior Judge Michael Maylson of the Eastern District of Pennsylvania. He has been overseeing the case since consolidation two years ago.

The defendant TIN has agreed to pay $5.25 million to settle claims from direct purchasers of drywall and $1.75 million to settle with indirect purchasers. Similarly, USG has agreed to pay $39.25 million to settle with the direct purchasers and $8.75 million to settle with indirect purchasers. The action isn’t quite over yet—as several defendants still need to settle.

Judge Baylson has also certified several classes of plaintiffs for the explicit purpose of facilitating the settlement and without having any effect on the still-ongoing litigation.

According to the complaint, the defendants account for more than 99 percent of drywall sold in North America. They are USG, National Gypsum, CertainTeed, Georgia-Pacific, American Gypsum, Lafarge, Temple-Inland (TIN) and PABCO. Well, if it wasn’t price-fixing it was certainly one hell of a coincidence.

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

Week Adjourned: 3.7.14 – TD Bank, Tech Workers, Data Breach Settlement

The week’s top class action lawsuits and settlements…top stories include TD Bank, Apple, Adobe, Google, Intel and the AVMEd data breach settlement.

Top Class Action Lawsuits

TD Bank Teed Up for Another Overdraft Fee Lawsuit? If at first you don’t succeed—is that the mantra here? TD Bank got hit with a consumer banking class action lawsuit this week alleging the financial institution continues to manipulate the order of debit card transactions so that it can profit through the maximization of overdraft fees. The lawsuit comes less than a year after the bank paid $62 million to settle a multidistrict litigation alleging the same practice. I’m sad to say I’m not surprised by these allegations.

Filed in Pennsylvania federal court by lead plaintiffs Sheila and Emilio Padilla, the complaint specifically alleges that TD Bank has continued to use a software scheme to illegally collect overdraft fees, and that it assessed the fees even when customers have sufficient funds in their account to cover the debit card payments.

“Defendant employs sophisticated software to automate its overdraft systems,” the complaint states. “These programs maximize the number of overdrafts, and thus the amount of overdraft fees charged per customer.”

The TD Bank class action complaint further states, “Many of the complained of practices continued as before, even after the class action settlement. Shockingly, unlike nearly all other banks sued in the multidistrict litigation, … TD has continued these practices even after it settled claims of wrongdoing based on these very same practices.”

The class action seeks to represent all TD Bank customers who opened a new account after the settlement class period ended on August 15, 2010, and who were charged improper overdraft fees. The class also seeks to represent those customers that had an account prior to August 2010 but were not charged overdraft fees until after that time.

Hi ho, Hi ho, it’s back to court they go!

Pays to Know Who’s in your Network? Well, maybe that’s what Adobe, Apple, Google and Intel thought—they’re facing a potential employment and salary fixing class action lawsuit over allegations they conspired to hire engineers from each other’s employee pools and knowingly shared salary data to establish pay ceilings. Nice.

Filed in California, the engineer and programmer class action lawsuit allegedly follows on from a 2012 investigation by the US Department of Justice which found that these practices were also evident at Lucasfilms, Pixar and Intuit. According to a report by the New York Times, the DOJ’s report suggests as many as 64,000 engineers and programmers were involved, which means the class action lawsuit could see billions in damages, if successful.

Rumor has it the sainted Steve Jobs was involved in cooking this one up. One to watch for sure.

Top Settlements

Finally—a Data Breach Class Action Settlement! And a finalized one at that. That’s right, final approval of a $3 million settlement has just been granted, ending the long-running AVMed data breach class action. Cast your mind back to 2009, when health insurance provider AvMed got hit with what was to become one of the first in a string of data breach lawsuits. This one alleged that sensitive data from 1.2 million customer records had been breached from unencrypted laptops. “Sensitive”? I think we’re talking health records, FYI.

Among the settlement terms is the stipulation that AvMed implement increased data security measures including mandatory security awareness training and encryption protocols on company laptops.

The $3 million settlement fund is set aside for plaintiffs to make claims for $10 for every year that they purchased insurance from AvMed, with a $30 cap: class members who experienced identity theft are reportedly eligible to make additional claims to recover their monetary losses.

Reportedly, this is the first settlement of a data breach lawsuit that provides compensation to plaintiffs who did not experience identity theft.

Ok Folks, That’s all for this 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: 12.23.11

A weekly wrap of the latest class action lawsuits and settlements, December 23, 2011

Top Class Actions

Another Corny Lawsuit? Ummm—you decide. A consumer fraud lawsuit was filed this week—testing the boundaries of food labeling vis-a-vis PepsiCo’s snacks business, Frito-Lay. The issue? Frito-lay is misleading consumers by making claims that its products, which contain genetically modified corn and vegetable oils, are all-natural, according to the lawsuit. (All natural corn=all natural chips? Really?)

Specifically, the lawsuit claims that by labeling some of its Tostitos and SunChips products as “made with all-natural ingredients” Frito-Lay is misleading consumers because genetically modified corn and vegetable oils are also present in the product. “The reasonable consumer assumes that seeds created by swapping genetic material across species to exhibit traits not naturally theirs are not ‘all natural’,” the claim states.

The claimant is pursuing the case on the basis of a violation of California and federal laws relating to unfair and fraudulent claims. I’m still struggling with the thought of any of this type of “food” being ok on any level—never mind whether or not it’s genetically modified. Bah humbug!

Top Settlements

Diamonds are Forever. So’s the De Beers Price Fixing Settlement now. The U.S. Court of Appeals for the Third Circuit has issued an opinion today upholding the settlement in the antitrust class action litigation against the South African company De Beers, the world’s largest diamond supplier, for allegedly conspiring to monopolize the sale of rough diamonds.

The appellate court affirmed an order by U.S. District Judge Stanley R. Chesler of the District of New Jersey that approved a settlement under which De Beers agreed to pay $295 million to U.S. jewelry makers, retailers, and consumers who purchased diamonds and diamond jewelry beginning in 1994.

The settlement also prevents De Beers from continuing its illegal business practices and requires De Beers to submit to the jurisdiction of the Court to enforce the settlement. Ouch! That’s a wee bit more than a wrist slap —but hey—that tennis bracelet sure looks good…

Talk about Soaring Gas Prices… More price fixing—this time in the stock market (now there’s a surprise)—and this time the guilty party is Amaranth Advisors LLC. They got hit with a $77.1 million settlement in a securities lawsuit brought by traders who allege the hedge fund manipulated the natural gas market. Whoa Nelly!

According to Businessweek, Amaranth collapsed in 2006 after losing $6.6 billion on natural gas trades. In August 2009, the Commodity Futures Trading Commission announced that Amaranth paid $7.5 million to settle market manipulation allegations however, in their lawsuit, the traders presented an expert who estimated damages at $3.5 billion.

Then, in April of this year, the Federal Energy Regulatory Commission issued a $30 million civil penalty against Brian Hunter, an Amaranth trader accused of manipulating the natural gas market in 2006.

FYI—the settlement isn’t final yet—a hearing on final approval of the class-action, or group, accord is reportedly scheduled for March 27 and, if approved, could pave the way for investor reimbursement.

Ok—That’s a wrap for this week. Merry Christmas—Happy Hanukkah—and Season’s Greetings—have a wonderful holiday everyone…

Week Adjourned: 11.19.10

Top Class Actions

A couple of potentially large potential class actions filed this week.

There for the Taking. The first—and this one’s rather worrying—lawsuit to make Week Adjourned this week is a class action filed against AvMed Health Plans for data breaches of personal information.

Apparently, laptops that contained millions of AVMed’s members’ confidential medical records were left unattended and—you guessed it—the laptops were subsequently stolen and AvMed’s members’ personal records were compromised.

And yes, this situation could be your worst nightmare. The records contained AvMed members’ names, home addresses, phone numbers, Social Security Numbers, as well as other highly sensitive medical history data such as diagnosis information, medical procedure and prescription information.

A lawyer representing the plaintiffs says this is easily one of the largest medical record breaches in history, and the disastrous consequences may plague those affected for their lifetimes. Further, they believe that AvMed did not follow government-mandated HIPAA protocols. Merely taking the time to encrypt their laptops, likely would have obviated any harm done by this theft. Terrific.

The second potentially large class action is by a group of farmers alleging price fixing of magnesium oxide—a compound widely used in farming and in animal feed—by Premier Chemicals LLC, Sumitomo Corporation of America, and YAS, Inc.

Farmers Fixin’ to Fight some Fixin’. The proposed class action seeks to represent all US purchasers, such as farmers and ranchers, of magnesium oxide or products containing Continue reading “Week Adjourned: 11.19.10”