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 magnesium oxide that were manufactured or distributed by Premier Chemicals LLC, Sumitomo Corporation of America, or YAS, Inc after January 1, 2004.
So what’s the big deal with magnesium oxide? Well, it has a couple of uses, in a couple of different forms. First, caustic magnesium oxide, can be combined with animal feed given to cattle and sheep. Second, dead-burned magnesium oxide, can be blended with fertilizers to increase nutrients in farming soil. So, useful stuff.
The lawsuit lists several various complaints, including the three companies who were allegedly justifying price increases on the basis of short supplies, and increased energy and freight costs, when Sumitomo was only using half of its entire capacity on a major barge route to Tulsa in 2004 in order to protect a price-fixing arrangement with Premier.
According to a statement from the attorneys who filed the suit, the U.S. and China are the world’s leading producers of caustic and dead-burned magnesium oxide. In 2000, Premier controlled the majority of the domestic market for caustic magnesium oxide and purchased dead-burned magnesium oxide from Chinese suppliers. When Premier started to see its market share shrink due to increased competition from China, the company began talks with other leading chemical suppliers, including Sumitomo and YAS, to set the price of caustic and dead-burned magnesium oxide in the US.
Not surprisingly, then the suit accuses the defendants of violating state and federal trade laws by entering into an agreement that artificially restrained commerce and manipulated prices of magnesium oxide.
Breaking News: 9/11 First Responders: Attorneys representing the plaintiffs who were injured while working in the rescue, recovery and debris removal activities at the site of the World Trade Center following the 9/11 terrorist attacks and subsequent collapse of the twin towers have confirmed today that they have surpassed the requisite ninety-five percent (95%) opt-in threshold required in their agreement with the City of New York and its Contractors. As a result, the Settlement is officially effectuated, as Settlement Allocated Claims Neutral Matthew Garrettson, Esq., announced earlier today
As reported by the Allocation Claims Neutral today, settlement opt-in numbers are as follows. A total of 10,043 eligible plaintiffs have submitted opt-in documents. This figure does not account for deficiencies in some of the plaintiffs’ documents that will have to be corrected. Broken down by injury “Tier” level, of the 10,043 eligible plaintiffs who have submitted documents, opt-in numbers indicate that:
a. Tier 1: 2,383 out of 2,726 eligible Tier 1 plaintiffs (87.4%);
b. Tier 2: 1,567 out of 1,619 eligible Tier 2 plaintiffs (96.8%);
c. Tier 3: 785 out of 807 eligible Tier 3 plaintiffs (97.3%);
d. Tier 4: 5,308 out of 5,411 eligible Tier 4 plaintiffs (98.1%);
e. All Tiers: 10,043 out of 10,563 all eligible plaintiffs (95.1%).
The original Settlement Process Agreement (‘SPA’) with the City is worth $625-$712.5 million, depending on the percentage of overall plaintiffs opting in to the settlement. That settlement has been made sweeter by a group of additional settlements negotiated with the Port Authority of New York and New Jersey ($47.5 million), two of the three contractors responsible for work performed at the Fresh Kills landfill in Staten Island with WTC debris ($24.3 million), the insurers for the Marine defendants responsible for the barges transporting WTC debris ($28 million), respirator manufacturer Survivair ($4.15 million) and Tishman ($1.4 million).
Another bad bank story—although this one isn’t completely over – until it’s over. BankAtlantic Bancorp, Inc announced this week that a jury in a shareholder class action suit against the Company has returned a verdict awarding $2.41 per share to shareholders who purchased shares of the Company’s Class A Common Stock during the period of April 26, 2007 to October 26, 2007 who retained those shares until the end of the period.
However, all did not go the plaintiffs’ way. The jury rejected the plaintiffs’ claim for the six month period from October 19, 2006 to April 25, 2007.
The suit was filed on allegations that the company granted a $27 million loan without an adequate appraisal of the underlying collateral, “significantly understated” its at-risk portfolio, lacked adequate internal and financial controls and deferred the recognition of losses associated with certain nonaccrual loans rather than taking timely writedowns on those loans. Umm.
BankAtlantic, however, sees the situation differently. No surprise there. The company said in a statement about the decision that it plans to file motions to set aside the verdict and if these are denied, the judge has indicated that she will certify all issues to the 11th Circuit Court of Appeals before any judgment is entered or claims commenced. Wonder if their service fees will go up…
Ok—that’s it for this week. See you at the Bar.