Week Adjourned: 9.25.09

Psychiatric Solutions feeling a bit under the weatherTop Class Actions

Behavioral Healthcare Behaving Badly? So, another securities class action to report this week, this one centers on Psychiatric Solutions Inc, a company that provides inpatient behavioral healthcare services. Great—they’re in the behaviour business…that’s encouraging…The suit alleges that the folks running the company— directors and officers—failed to disclose problems regarding safeguards and controls for some of its operations, and that the company directors and certain of its officers flogged stock on the back of “materially false and misleading” statements about their financial health.

While this class action obviously affects people who bought Psychiatric Solutions stock, did you know that if you are an employee and have been issued stock or stock options in this company—you may be eligible as a plaintiff in this class action under Employee Retirement Income Security Act (ERISA)?

Top Settlements

Say it isn’t True, True. Another dating story gone wrong—only this time it’s the dating site that’s to blame—not the date. TrueBeginnings LLC, the owner and operator of the True.com online dating website, has agreed to settle a class action lawsuit that was brought against it by a former subscriber who alleged that True had unlawfully charged fees to his credit card after he cancelled his subscription. Nice.

The lawsuit claimed that True failed to provide former subscribers with information about their AutoSubscription system… that sounds vaguely Orwellian. 

As part of the settlement, True has agreed to pay $1.5 million into a settlement fund over a period from February 2009 through March 2010. Certain former True subscribers are eligible to make claims for refunds of either $35 (if they were charged only a single month’s fees) or $50 (if they were charged two or more month’s fees). In addition, a larger group of former subscribers will be offered 45 days of free subscription service on the True.com website. True also has agreed to a Court order requiring an intervening affirmative action or step to its Auto-Subscription system, to indicate that the potential subscriber assents to re-subscription. 

Members of the settlement class have until October 21, 2009, to submit claims forms to participate in the settlement.

Hardware Hard Labor? Lowes got hit with a $29.5 million settlement this week, bringing to an end a wages and overtime class action brought by two former employees. Filed in 2001—yes, that’s eight years of litigation—the employees alleged that thousands of hourly Lowes workers were required to work “off the clock” before and after their normal shifts, for which they were not paid.

It is anticipated that settlement proceeds will be sent to claimants by the end of this year.

That’s it for this week. See you at the Bar!

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