Week Adjourned: 3.28.14 – Coca-Cola, Synovus, Abercrombie & Fitch

The week’s top class action lawsuits and settlements. Top stories include Coca-Cola, Synovus Bank and Abercrombie & Fitch.

.cokeTop Class Action Lawsuits

Coke is it! (Really?) Coca-Cola Company—the company that wants to teach the world to sing (or did)—and Coca-Cola Refreshments USA Inc. had better get their song sheets sorted out. They got hit with a consumer fraud class action lawsuit this week, over allegations they violated federal and state laws by fraudulently and negligently making claims on its two-liter bottles and other packages that its products have “no artificial flavors. No preservatives added. Since 1886.” Ok—who’s away with the Fairies here—no change since 1886?

According to the Coca-Cola lawsuit, U.S. District Court for the Northern District of Illinois case number: 1:14-cv-01914 “This statement, as well as the entire premise of the Pemberton campaign, was false and misleading…In fact, Coca-Cola contains phosphoric acid. Phosphoric acid is both an artificial flavoring and a chemical preservative.”

Filed by plaintiff Ronald Sowizrol, the lawsuit goes on to claim that Coca-Cola falsely represented that Coca-Cola is still made with the “original formula” devised by John Pemberton in 1886. “In fact, the composition of Coca-Cola has repeatedly changed over time,” the lawsuit states. “These changes have included, among other things, an increase in the amount of unhealthy ingredients like sugar and corn syrup and the addition of artificial ingredients like phosphoric acid.”

Sowizrol claims that Coca-Cola knowingly and intentionally sold misbranded products to consumers with the intent to deceive. He alleges he purchased Coke, Diet Coke, Caffeine Free Coke and Sprite in 2-liter bottles, 20-ounce bottles and individual and various packages of 12-ounce cans and that all related containers failed to state that any ingredients are used as artificial flavoring or as a chemical preservative. Had he known, he claims he would not have purchased Coca-Cola products.

Sowizrol claims the defendants have violated the Illinois Food, Drug and Cosmetic Act by misbranding Coca-Cola products, and that Coca-Cola has been unjustly enriched by its unlawful and deceptive actions.

Better get in line to sign up for this one.

Top Settlements

Another Bank Caught with its Hand in the Cookie Jar—or more specifically its customers’ bank accounts. This time its Synovus’ turn—and for their sins they will likely have to pony up $24 million—as settlement in the overdraft fees class action lawsuit it’s facing.

Filed in July 2010, the Synovus lawsuit covers the period between July 10, 2004, and February 3, 2014, and alleges Synovus banks charged excessive overdraft fees on debit-card purchases or ATM cash withdrawals using debit cards.

According to court documents, “A lawsuit filed by customers of Synovus Bank … claims that the fees Synovus charged in connection with overdrafts arising from a (point of sale) or ATM debit card transaction constitutes interest, and as a result, Synovus has violated Georgia’s usury laws, committed conversion and is liable to plaintiffs for money had and received.”

Synovus said the settlement agreement has been made “without admitting liability,” with current and former Georgia resident bank customers eligible to participate if they have been charged an overdraft fee over that nearly 10-year period. Over a dozen Synovus divisions are included in the settlement including Columbus Bank and Trust.

The proposed settlement has been preliminarily approved by the court, according to the Synovus notice to customers. A fairness hearing will take place May 20.

A&F to Pay up…Abercrombie & Fitch, no stranger to lawsuits, reached a preliminary $575,000 settlement this week, potentially ending an unpaid overtime class action lawsuit pending against it in Pennsylvania. The lawsuit, filed by lead plaintiff Paul Oliver in November 2012, alleged the clothing retailer had violated the Pennsylvania Minimum Wage Act with its overtime wage policy.

This week, a state judge in Pennsylvania granted the approval, creating a class of 702 plaintiffs, consisting of all eligible A&F employees in that state between November 2009 and the beginning of January 2014.

According to Pennsylvania state law, employees are entitled to overtime wages that are at least 1.5 times the regular rate. Oliver filed the employment class action against Abercrombie alleging that the retailer, which operates at least 44 stores in the state, relies on an overtime calculation that violated the PMWA. Under a fluctuating work week, which is the model Abercrombie used, non-exempt employees get paid a fixed amount per week and receive half their hourly wage for each hour of overtime. This system is allowed under the Federal Labor Standards Act (FLSA), but is, Oliver alleged, in violation of state employment law.

Under the terms of the settlement, Oliver will receive $7,500 for bringing the lawsuit and acting as lead plaintiff. “Based on plaintiff’s counsel’s review and analysis of the relevant payroll data, the $403,750.00 in available class member payouts will enable each participating class member to recover (free and clear of attorneys’ fees) over 50 percent of his/her alleged unpaid overtime during the class period,” according to the settlement.

The case is Oliver v. Abercrombie & Fitch Co., case number 121102571 in the Philadelphia County Court of Common Pleas.

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