Top Class Action Lawsuits
Mind the Gap—the Credibility Gap that is. This week, two separate consumer fraud class action lawsuits were filed against The Gap Inc., Banana Republic LLC and Saks Fifth Avenue LLC in a California court alleging they deceived customers as to the quality and supposed savings of outlet store items.
According to the lawsuit against The Gap and Banana Republic, which The Gap owns, the company hides a “Factory Store” label with three squares on it, on clothing it sells at its outlets. The lawsuit claims that the label indicates the clothes were made specifically for the outlet and are of inferior quality to those sold in the traditional Gap and Banana Republic retail outlets.
In the Saks Fifth Avenue lawsuit, plaintiffs allege the retailer uses a manufactured “Market Price” inducing the consumer to believe that they would pay a higher price for the price at a traditional Saks Fifth Avenue store, in addition to putting the lower outlet price on the items, creating the impression that consumers are getting a discount.
However, the lawsuit contends that items sold at Saks Off 5th clearance stores were made specifically for the outlet. Named plaintiff Tova Malik says it was this perceived price savings that led her to purchase items from a Saks Off Fifth store at an outlet mall in Camarillo, California.
“Defendant labels its Saks Off 5th clothing with a tag that shows a markedly lower price from the “Market Price,” which corresponds to the price that appears to be used in traditional Saks Fifth Avenue retail stores,” the lawsuit states. “Plaintiff was lured in by this large price difference and as a result purchased items of clothing and accessories from defendant’s Saks Off 5th in July of 2014.”
The plaintiffs for the Gap and Saks Fifth Avenue lawsuits are represented by Michael Louis Kelly, Behram V. Parekh and Heather M. Baker of Kirtland & Packard LLP.
The cases are Malik v. Saks Fifth Avenue LLC, case number BC555134; and Rubenstein v. The Gap Inc., case number BC555010, in the Superior Court of the State of California, County of Los Angeles.
A Prescription for Walgreens: Pay the overtime. Yup. This week the national pharmacy chain got hit with an unpaid overtime class action lawsuit filed in California federal court by pharmacists alleging the company violated California labor law and the Fair Labor Standards Act (FLSA) by failing to pay them minimum wage and overtime for training hours and time spent maintaining their uniforms.
According to the Walgreens lawsuit, lead plaintiff Debra Short was a nonexempt pharmacist with the company from September 1997 to April 2012. During that period, Walgreens denied its pharmacists overtime hours for training and failing to pay them all of their owed wages upon termination.
“As a result of defendants’ unlawful conduct, plaintiff and the other class members have suffered damages in an amount, subject to proof, to the extent they were not paid the full amount of wages earned during each pay period during the applicable limitations period, including overtime wages,” the complaint states.
Under the California Labor Code, if an employer does not maintain its own employee uniforms, then it is obligated to pay employees who must wear uniforms for one hour per week of uniform maintenance. According to the lawsuit, Walgreens failed to pay its pharmacists minimum wage for uniform maintenance time each week.
Further, the lawsuit claims that Walgreens failed to pay its pharmacists for class training time, which required at-home work and other training, all of which was necessary so the pharmacists would become certified in immunization and CPR administration.
Short also alleges that Walgreen’s pharmacists are required to work more than seven days in a row without rest days and that the company fails to compensate them for all of their wages earned upon termination of their employment, in violation of California Labor Code.
Heads up folks—the lawsuit is seeking certification of five subclasses, including one in California comprising pharmacists who were employed over the past four years and one comprising pharmacists across the country over the past three years. Short is seeking payment of all unpaid wages and damages.
The case is Short v. Walgreen Co. , case number 3:14-cv-03747, in the U.S. District Court for the Northern District of California.
Top Settlements
So LinkedIn may be about to settle a data breach class action lawsuit for $1.25 million.
Plaintiffs in a federal class action lawsuit are seeking approval of the settlement, potentially ending the action which stems from a 2012 data breach of LinkedIn Corp. The lawsuit claims the social media site misled customers about its data protection policies in connection with the data breach.
In the lawsuit, lead plaintiff Khalilah Gilmore-Wright claimed she and other class members purchased premium LinkedIn accounts believing that the company provided industry-standard security. However, LinkedIn’s security was in fac outdated and insufficient, resulting in a massive data breach in June 2012 in which a hacker posted 6.5 million user passwords onto the Internet.
According to the terms of the proposed LinkedIn settlement, if approved, LinkedIn would set up a $1.25 million fund from which class members could receive as much as $50. The class would include everyone who paid a fee to LinkedIn for a premium subscription between March 2006 and June 2012. Gilmore-Wright would receive $7,500. There are approximately 800,000 premium subscribers.
The case is In re: LinkedIn User Privacy Litigation, case number 5:12-cv-03088, in the U.S. District Court for the Northern District of California.
Ok Folks—time to adjourn for the week. Have a fab weekend–see you at the bar!
What a week for securities class actions!