/raid1/www/Hosts/bankrupt/CAR_Public/150722.mbx
C L A S S A C T I O N R E P O R T E R
Wednesday, July 22, 2015, Vol. 17, No. 145
Headlines
ABBVIE INC: Sidney Hillman Case Will Return to District Court
ABBVIE INC: Faces Class Action Filed by five individuals
ABBVIE INC: Faces Class Action filed by Medical Mutual
AGRO-JAL FARMING: Field Workers File Overtime Class Action
ALICE'S TEA: Immigration Status Not Significant in Fair Wage Suit
AMERICAN AIRLINES: Faces Ticket Price-Fixing Class Actions
AMTRAK: Agrees to Consolidation of Train 188 Derailment Cases
APPLE INC: Class Action Over Bag Search Policy Can Proceed
APPLE INC: Judge Draws Up Trial Plan for Bag-Check Class Action
ARKANSAS: Nurses File Overtime Suit v. Dept. of Veteran Affairs
ASTRAZENECA: Settles Suit Over Underpaid Rebates for $54 Million
ASTRAZENECA: Delaware Court Tosses Consumer Fraud Class Action
AXA EQUITABLE: Discovery Ongoing in "Yale" Class Action
AXA EQUITABLE: Faces "Yarbrough" Class Action
BANK OF AMERICA: Announces Initial Distribution of Settlement Fund
BAYER CROPSCIENCE: Judge Certifies Class in Settlement Dispute
BELL MOBILITY: Loses Bid to Overturn 911 Fee Court Ruling
BERNARD MADOFF: Konigsberg May Receive Leniency in Fraud Case
BP PLC: Litigation Continues Over $9BB Private Claims Settlement
CADIZ INC: Defending Against "Van Wingerden" Class Action
CANADA: Sued Over Inadequate Care for Mentally Ill Prisoners
CAY CLUBS: Trial Begins in $300-Million Fraud Case
CENTURY CITY: ILG Ordered to Disgorge $15MM in Attorney Fees
CHANEL INC: Faces Class Action Over Labor Violations
CITIZENS FINANCIAL: Defending TCPA Case in S.D. Calif.
CITIZENS FINANCIAL: Defending Class Suit Over LIBOR
COHN FYVOLENT: Ordered to Pay $1.5MM in Legal Malpractice Case
COMMUNITY BANK: Agreement in Principle Reached in M.D. Pa. Suits
CYPRESS SEMICONDUCTOR: Settles SRAM Class Actions in Canada
CYPRESS SEMICONDUCTOR: Inks MOU to Resolve Spansion Merger Case
DEX MEDIA: To Honor Indemnification Obligations
DEX MEDIA: SuperMedia Filed Motion to Dismiss
ENOVA INTERNATIONAL: No Ruling Yet on Motion for Summary Judgment
ENVISION HEALTHCARE: Court Certifies Overtime Claim Class
FAST RIG: Judge Tosses Motion to Dismiss FLSA Overtime Suit
FOX SEARCHLIGHT: 2nd Cir. Adopts Intern Pay Standard
FTD COMPANIES: Class Action Parties Filed Memorandum
GENERAL MOTORS: Seeks Dismissal of Fourth Securities Class Action
GLAXOSMITHKLINE: Girard Keese Must Pay Avandia MDL Committee
HEALTHWAYS INC: To Defend Against Edward Simon Action
HEALTHWAYS INC: To Defend Against Affiliated Health Action
HEMISPHERX BIOPHARMA: July 22 Settlement Fairness Hearing Set
HOME DEPOT: Delivery Derivers File Overtime Class Action
IOWA SELECT: Wants Judge to Block Sale of Dietary Supplements
JANSSEN PHARMACEUTICA: Court Cuts Penalty in Drug Marketing Case
JIMMY JOHN'S: Assistant Managers File Overtime Class Actions
JP MORGAN: $388 Mil. Recovered in MBS Securities Class Action
LENOVO GROUP: Firms Argue Over Lead Counsel Slots in Adware MDL
LEVEL 3: Settlement of Rights-of-Way Case Presented to Court
LEVEL 3: Defending Severance and Contractor Termination Disputes
LIBERTY MEDIA: SIRIUS XM Defendant in Class Action Suits
LSB INDUSTRIES: Subsidiary Facing "Emmert" Class Action
LUMBER LIQUIDATORS: Shareholder Sue Over Formaldehyde in Floorings
M&T BANK: Parties in Securities Litigation Engaged in Discovery
MAXIM HEALTHCARE: Settles Employee's Overtime Class Action
MGM RESORTS: Court Heard Oral Argument on Class Cert. Bids
MOHAWK INDUSTRIES: Settles Antitrust Claims by Purchasers
MOHAWK INDUSTRIES: Reached Agreement to Settle Canadian Actions
MRI INTERNATIONAL: 3 Executives Indicted in Investment Fraud Case
MYLAN N.V.: Accrued $13.9MM on Product Liability at March 31
NAT'L COLLEGIATE: Judge Okays $60MM Athlete Likeness Settlement
NEW JERSEY: Judge Tosses Class Action Over Bridgegate Scandal
NEW YORK, NY: Settles Occupy Wall Street Pepper Spray Suits
ORRSTOWN FINANCIAL: Court Ruling on Motion to Dismiss Pending
PAIN THERAPEUTICS: Plaintiffs Ordered to Start Over Remoxy Trial
PHILIP MORRIS: Marlboro Lights Notification Program Begins
POST HOLDINGS: Class Cert. Phase of Antitrust Case On Going
PROTECTIVE LIFE: Claims in Delaware Action Won't Be Released
RAYONIER INC: Aug. 25 Hearing on Bid to Dismiss Class Action
REGIONAL MANAGEMENT: Continues to Defend Securities Suit in SDNY
RENASANT CORPORATION: Facing Stein v. Heritage Class Action
SABRE: Faces Class Action in New York Over Alleged GDS Collusion
SAKUMA BROTHERS: Farmworkers Entitled to Rest Break Pay
SANDHURST: Faces Investor Class Action Over Wickham Collapse
SEAWORLD ENTERTAINMENT: To Defend Against "Baker" Lawsuit
SEAWORLD ENTERTAINMENT: No Response Yet to "Hall" Suit
SEAWORLD ENTERTAINMENT: Class Actions in Fla., Tex. Dismissed
SEAWORLD ENTERTAINMENT: "Anderson" Action in Preliminary Stages
SPECTRUM PHARMACEUTICALS: Replies to Motion for Reconsideration
TAYLOR ENERGY: Judge Refuses to Dismiss Oil Leak Case
TCP INTERNATIONAL: To Seek Consolidation of Class Actions
TEXTURA CORPORATION: Filed Motion to Dismiss Class Action
TIME WARNER: Woman Gets $230,000 Award in Robocall Case
UBER TECHNOLOGIES: Must Face Cab Companies' False Ad Suit
UBER TECHNOLOGIES: Continues to Face Legal Challenges Abroad
UNITED STATES: NSA Data Collection Unconstitutional, Groups Claim
UNIVERSITY OF NORTH CAROLINA: Wants Student-Admission Suits Stayed
VCA INC: To Defend Against Remaining Claims in "Duran" Case
VCA INC: Court Stayed "La Kimba Bradsbery" Lawsuit
VCA INC: "Lopez" Case Settlement Awaits Court Approval
VCA INC: "Graham" Class Action in Early Procedural Stage
VICAL INCORPORATED: Lawsuit Over Allovectin(R) Dismissed
WAL-MART: Faces Class Action Over Same-Sex Discrimination
WIDENER UNIVERSITY: Class Certif. Denied in Law Jobs Stats Suit
XL FOODS: Settlement Agreement Reached in Beef Recall Class Action
XOOM CORP: Faces Shareholder Suit Over Pending Paypal Acquisition
XTO ENERGY: Faces Class Action Over Gas Royalty Payments
* FCC Turns Attention to Telecom Deceptive Plan Practices
* FLSA Overtime Revisions to Pose Big Challenges for Companies
* San Francisco to Enforce Retail Workers Bill of Rights
*********
ABBVIE INC: Sidney Hillman Case Will Return to District Court
-------------------------------------------------------------
AbbVie Inc. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that the case, Sidney Hillman Health Center
of Rochester, et al. v. AbbVie Inc., et al., will return to the
district court for further proceedings.
In August 2013, a putative class action lawsuit, Sidney Hillman
Health Center of Rochester, et al. v. AbbVie Inc., et al., was
filed against AbbVie in the United States District Court for the
Northern District of Illinois by three healthcare benefit
providers alleging violations of federal Racketeer Influenced and
Corrupt Organizations (RICO) statutes and state deceptive business
practice and unjust enrichment laws in connection with
reimbursements for certain uses of Depakote from 1998 to 2012.
Plaintiffs seek monetary damages and/or equitable relief and
attorneys' fees. In April 2015, the United States Court of Appeals
for the Seventh Circuit reversed the district court's decision to
dismiss all of the plaintiffs' claims with prejudice on statute of
limitations grounds. The case will return to the district court
for further proceedings.
ABBVIE INC: Faces Class Action Filed by five individuals
--------------------------------------------------------
AbbVie Inc. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that in November 2014, five individuals
filed a putative class action lawsuit on behalf of purchasers and
sellers of certain Shire plc securities between June 20 and
October 14, 2014, against AbbVie and its chief executive officer
in the United States District Court for the Northern District of
Illinois alleging that the defendants made and/or are responsible
for material misstatements in violation of federal securities laws
in connection with AbbVie's proposed transaction with Shire. The
complaint seeks unspecified monetary damages and injunctive
relief.
ABBVIE INC: Faces Class Action filed by Medical Mutual
------------------------------------------------------
AbbVie Inc. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that in November 2014, a putative class
action lawsuit, Medical Mutual of Ohio v. AbbVie Inc., et al., was
filed against several manufacturers of testosterone replacement
therapies (TRTs), including AbbVie, in the United States District
Court for the Northern District of Illinois on behalf of all
insurance companies, health benefit providers, and other third-
party payors who paid for TRTs, including AndroGel. The claims
asserted include violations of the federal RICO Act and state
consumer fraud and deceptive trade practices laws. The complaint
seeks unspecified monetary and injunctive relief.
AGRO-JAL FARMING: Field Workers File Overtime Class Action
----------------------------------------------------------
Patrick S. Pemberton, writing for The Tribune, reports that former
California Lt. Gov. Abel Maldonado and his family business failed
to pay dozens of field workers for overtime work, according to a
class-action lawsuit.
The suit was filed on July 15 in San Luis Obispo Superior Court by
Cipriano Ponce and Carlos Farias, who worked for Agro-Jal Farming
Enterprises, which operates in San Luis Obispo and Santa Barbara
counties. Besides Maldonado and Agro-Jal, defendants named in the
suit include Maldonado's father, Abel Maldonado Sr., and brother,
Frank Maldonado.
Allen Hutkin, the San Luis Obispo attorney who filed the lawsuit,
said the suit was filed on behalf of the two plaintiffs and more
than 100 other past and present employees similarly situated.
"We believe the practice we're alleging was widespread," he said.
Claims made in civil complaints only represent the plaintiff's
side.
A message left with Frank Maldonado, president of Agro-Jal, was
not returned on July 17.
According to the complaint, the plaintiffs were denied overtime
wages, not reimbursed for expenses and not provided meal and rest
periods. The complaint also alleges that the defendants did not
maintain adequate records to show employees how many hours they
worked.
Messrs. Ponce and Farias were field workers for Agro-Jal, the suit
states, working 13-hour days six days a week and six-hour days on
the seventh day. Under state law, agricultural workers must be
paid overtime for time worked over 10 hours during the first six
work days and anything over 8 hours on the seventh work day.
The plaintiffs, however, contend that they were not paid a minimum
wage and overtime or double-time wages for all hours worked.
Mr. Ponce was employed by Agro-Jal from 1984 to 2014, according to
the suit, while Farias worked there from 2008 through April of
2012.
While the suit focuses on the past four years, Mr. Hutkin said he
believes the violations have been committed longer.
Mr. Maldonado was once a rising star in the Republican Party, and
he served in both the state Assembly and Senate. After an
unsuccessful bid for state controller in 2006, Mr. Maldonado was
appointed lieutenant governor in 2009 by then-Gov. Arnold
Schwarzenegger. After Gavin Newsom defeated him in the race for
lieutenant governor in 2010, Mr. Maldonado unsuccessfully ran for
the U.S. House of Representatives in 2012 and briefly ran for
governor in 2014 before dropping out.
While running for Congress, amid allegations that Agro-Jal owed
more than $100,000 in taxes, Mr. Maldonado said he parted ways
with the business in 2012.
The son of immigrant field workers, Maldonado grew up picking
strawberries with his parents, according to his biography on
SmartVoter.org. He studied crop science at Cal Poly but did not
graduate. After his family grew frustrated with government
bureaucracy while applying for a building permit, he became mayor
of Santa Maria at age 26.
He told his family's story at a speech during the 2000 Republican
National Convention and was courted by the George W. Bush campaign
to appear with the presidential candidate during multiple campaign
stops.
In 2010, Agro-Jal business also made headlines for safety
violations. According to a Los Angeles Times story from 2010,
Mr. Maldonado said the violations were the result of overzealous
regulators.
ALICE'S TEA: Immigration Status Not Significant in Fair Wage Suit
-----------------------------------------------------------------
Mark Hamblett, writing for New York Law Journal, reports that
immigrant laborers in fair wage litigation are not obligated to
turn over papers on their immigration status or their tax returns
in discovery, a federal magistrate judge has ruled.
Southern District Magistrate Judge James Francis said that Alice's
Tea Cup, which has three restaurants in Manhattan, is not entitled
to the material in a suit brought under the Fair Labor Standards
Act, 29 U.S.C. Sec. 201.
In Rosas v. Alice's Tea Cup, 14 Civ. 8788, current and former
employees claim the restaurants and their owners, Zhariff Melgoza
and Haley Fox, failed to pay them overtime and a "spread of hours"
premium for days where they worked more than 10 hours.
On May 11, the defendants demanded the plaintiffs verify their
immigration status, provide work authorization documents, federal
and state tax returns and documents showing their current
employers. They also requested admissions from the plaintiffs on
their immigration status and asked them to admit they supplied
false Social Security numbers when hired.
The plaintiffs moved for a protective order from Judge Francis,
arguing the requests were irrelevant to determine their claims
under the law. The defendants countered that the information
affected their ability to recover damages, would affect the
plaintiffs' credibility and would explain the absence of payroll
records.
Judge Francis said that the protections of the law are as
available to undocumented workers as they are to U.S. citizens,
and, in the context of wage and hour violations under the Fair
Labor Standards Act (FSLA) and New York Labor Law, "immigration
status has generally been protected from discovery." He said
courts have distinguished between cases where undocumented workers
have sought back pay for work actually performed and those where
people seek back pay for work not performed following a
termination that violates the National Labor Relations Act.
So, Judge Francis said, the defendants' contention that any
plaintiff who violates the immigration laws is barred from
recovery under the Fair Labor Standards Act fails because the
defendants relied solely on cases where back pay was sought for
work not performed.
Even if the immigration status was relevant, Judge Francis said,
the risk of injury to the plaintiffs outweighed the need for
disclosure "because of the danger of intimidation and of
undermining the purposes of the FLSA."
On the federal and state tax returns, he said returns aren't
"inherently privileged," but courts are reluctant to compel their
disclosure, and the defendants here "have failed to demonstrate
either relevance or a compelling need."
"Indeed, the plaintiffs' tax returns would only include total
income and not details that would be relevant in an FLSA and [a
state Labor Law] suit, such as weekly wages and specific hours
worked," he said, so forcing the plaintiffs to provide the records
would serve no purpose but to intimidate.
Judge Francis also ruled that the plaintiffs need not disclose
their current employers or admit they are being paid in cash.
The defendants had said the information was relevant because it
would show the plaintiffs were content to be paid in cash, as they
were trying to avoid scrutiny given their immigration status.
"[W]hatever the plaintiffs' arrangement with their current
employers might be, it says nothing about the hours that the
plaintiffs worked for the defendants or what they were paid,"
Judge Francis said.
Peter Cooper of Cilenti & Cooper represents the plaintiffs.
Howard Matalon -- hmatalon@olenderfeldman.com -- of OlenderFeldman
represents the defendants. Neither could be immediately reached
for comment.
AMERICAN AIRLINES: Faces Ticket Price-Fixing Class Actions
----------------------------------------------------------
Zoe Tillman, writing for The National Law Journal, reports that as
the U.S. Department of Justice investigates whether airlines
conspired to keep ticket prices high, consumers are already going
to court.
On July 6, Quinn Emanuel Urquhart & Sullivan filed an antitrust
class action against American Airlines Group Inc., Delta Air Lines
Inc., Southwest Airlines Co. and United Airlines Inc. in the U.S.
District Court for the District of Columbia. Similar cases were
filed over the past week in federal district courts in San
Francisco, New York and Chicago.
The lawsuits accuse the four airlines of colluding to fix the
price of domestic airline tickets by limiting the seating capacity
on U.S. flights, curbing the number of U.S. flights offered to
consumers and restricting access to price information.
Bernstein Liebhard and Cohen Milstein Sellers & Toll are working
with Quinn Emanuel on the D.C. case. Law firms involved in the
cases filed elsewhere include Hausfeld; Robbins Geller Rudman &
Dowd; Lowey Dannenberg Cohen & Hart in White Plains, New York;
Segal, McCambridge, Singer & Mahoney of Chicago; and Nussbaum Law
Group in New York.
The Justice Department has confirmed to several news outlets that
it was investigating "possible unlawful coordination" among
airlines. A Justice Department spokeswoman was not immediately
available to comment on July 7.
A United spokesman on July 7 said the airline had received a
letter from the Justice Department and was complying with the
request. He declined to comment on the private class actions. A
Southwest representative said via email that the airline was aware
of the litigation but would not comment on the allegations.
A spokesman for Delta said that the airline received a civil
investigative demand from DOJ and was "fully cooperating." An
American Airlines spokesman also confirmed that the airline
received a demand for information and said that DOJ sought
documents and information about "airline capacity."
As for the private class actions, the American Airlines spokesman
said in a statement that there was a "robust and competitive
marketplace" that had benefitted consumers and that the company
would "vigorously contest" the antitrust claims.
According to the lawsuit filed in D.C., lawyers expect the class
to include hundreds of thousands of consumers nationwide who
bought domestic airline tickets from one of the four airlines
since at least 2011.
Quinn Emanuel partner Stephen Neuwirth --
stephenneuwirth@quinnemanuel.com -- who chairs the firm's
antitrust practice, is lead counsel for the plaintiffs. He said
it was a "virtual certainty" that the cases filed across the
country would be consolidated. There were "several compelling
reasons" why D.C. made sense as a venue for the class action
claims, he said, including the fact that the government
investigation was believed to be based out of Justice Department
headquarters in Washington.
"This is an instance where, as is often the case, private
enforcement actions are an important complement to a government
investigation," Mr. Neuwirth said.
As evidence of the alleged conspiracy, the plaintiffs cited a rise
in prices for domestic flights even as fuel prices dropped; the
consolidation of the airline industry, most recently with the
merger of American and US Airways in 2013; the airlines' embrace
of "capacity discipline" to limit the number of flights and seats
available; and alleged efforts to direct consumers away from
websites that compare ticket prices.
The Justice Department originally challenged the $11 billion
American-US Airways merger, warning that it could lead to higher
prices and worse customer service. The government reached a
settlement with the airlines in late 2013 that permitted the
merger to go through. U.S. District Judge Colleen Kollar-Kotelly
approved the deal in April 2014.
AMTRAK: Agrees to Consolidation of Train 188 Derailment Cases
-------------------------------------------------------------
P.J. D'Annunzio, writing for The Legal Intelligencer, reports that
Amtrak has agreed with plaintiffs in the Train 188 derailment
litigation that all cases should be funneled into a multidistrict
litigation in the U.S. District Court for the Eastern District of
Pennsylvania.
Amtrak replied on June 30 to the plaintiffs' petition to create an
MDL. The petition called for all similar cases in different
jurisdictions, including New York and New Jersey, to be
transferred to the U.S. District Court for the Eastern District of
Pennsylvania, where the bulk of the Amtrak derailment cases have
already been filed.
As noted in Amtrak's reply, the nascent MDL originally included 19
personal injury lawsuits involving 42 plaintiffs filed in federal
courts; one was filed in the District of New Jersey, another in
the Eastern District of New York, four in the Southern District of
New York, and 13 in the Eastern District of Pennsylvania. In the
time since the plaintiffs filed their MDL petition, two wrongful-
death suits have been filed in the Eastern District of
Pennsylvania.
"Amtrak anticipates that numerous additional lawsuits will be
filed relating to the derailment of Train 188, including wrongful
death and survival actions and personal injury claims," court
papers said. "Amtrak has been contacted by counsel representing
other passengers who have not yet filed suit, including counsel
located in the Eastern District of Pennsylvania. The expectation
of additional lawsuits further supports the order transferring all
related cases to the Eastern District of Pennsylvania for
coordinated or consolidated pretrial proceedings under Judge
[Legrome] Davis' supervision."
Amtrak's lawyer, Yuri J. Brunetti -- ybrunetti@lcbf.com -- of
Landman Corsi Ballaine & Ford, declined to comment.
The bulk of the plaintiffs' cases are being handled jointly by the
law firms of Kline & Specter and Saltz Mongeluzzi Barrett &
Bendesky.
Kline & Specter co-founder Thomas R. Kline said in an email that
he and Saltz Mongeluzzi co-founder Robert Mongeluzzi are "pleased
to see that Amtrak has joined our request to consolidate the cases
in federal court in Philadelphia, and now hope for a prompt ruling
by the [MDL] panel. We believe that early consolidation will lead
to organization, structure, and uniform supervision of the
litigation."
The litigation could potentially have hundreds of plaintiffs, as
the derailment left more than 200 people injured and eight dead.
Despite that, the potential damages available for the victims of
the derailment are capped at $200 million as per a 1997 federal
law.
The law, which has come under fire over the years for not
adequately covering victims' damages from serious train accidents,
mandates Amtrak have $200 million in liability coverage for a
single incident.
According to the plaintiffs' MDL petition, an MDL under the
direction of a single judge is critical in the event that the $200
million needs to be parsed out.
Prior to the filing of the MDL petition, Amtrak responded to a
motion from the plaintiffs requesting Amtrak, the National
Transportation Safety Board, and the Federal Railroad
Administration preserve and track the custody of evidence.
In court papers, Amtrak said the NTSB is in charge of the
investigation of the accident and the company has no control over
the evidence gathered. Moreover, Amtrak asked that the motion be
denied as premature.
"While the NTSB has designated Amtrak as a formal party to the
investigation," court papers said, "the NTSB expects Amtrak to
observe confidentiality rules; specifically, Amtrak is not
permitted to disclose any 'investigative information' to anyone
outside the NTSB investigation."
Amtrak also said the NTSB has the last word in conducting the
investigation.
"Accordingly, given these confidentiality requirements, and the
fact that the NTSB has possession and control of the evidence at
issue in plaintiff's motion, Amtrak cannot make the evidence at
issue available for inspection and cannot take responsibility for
the preservation of all such evidence," court papers said.
A reply filed by plaintiffs Bruce and Kalita Phillips asked the
court to compel Amtrak and the NTSB to itemize every piece of
evidence and notify the plaintiffs' counsel when evidence is to be
released.
Additionally, the plaintiffs' reply said confidentiality had
already been disregarded, since Amtrak and NTSB officials have
publicly commented on the accident.
Lastly, the reply noted, "Amtrak's representation that it will
preserve evidence once released by the NTSB is insufficient to
ensure plaintiffs' rights and to provide necessary protection of
the evidence. Amtrak's negligence killed and maimed too many
innocent employees and passengers to simply trust Amtrak to do the
right thing. The passengers on train No. 188 had placed their
trust in Amtrak and the result was death and devastating
injuries."
APPLE INC: Class Action Over Bag Search Policy Can Proceed
----------------------------------------------------------
RT reports that a lawsuit brought against tech giant Apple by its
own employees over the company's bag search policy can go forward
as a class action, a federal judge has decided. The decision
affects more than 12,000 past and present employees.
The suit alleges that Apple must compensate store employees for
the time spent waiting for company managers to search bags for
stolen merchandise whenever employees left the store, including
meal breaks, according to plaintiffs Amanda Frlekin and
Dean Pelle.
US District Judge William Alsup ruled on July 16 in San Francisco
that the 2013 lawsuit can include current and former employees of
Apple's 52 stores in California.
At least two Apple retail employees had taken complaints over the
searches to top executive Tim Cook, saying the policy was
demeaning, according to court filings.
One employee told Cook in 2012 that Apple managers "are required
to treat 'valued' employees as criminals." Mr. Cook then
forwarded the email message to other top Apple employees, asking,
"Is this true?"
As many as 12,000 current and former employees are included as
class members in the suit, the ruling said. Workers allege that
they often had to wait around 15 minutes for a check to occur.
With that many employees seeking compensation for 15 minutes of
pay at California's minimum wage of $9 an hour, that total could
hit $60 million, Michael Risch, a law professor at Villanova
University School of Law, told Bloomberg. The company could face
another $15 million in penalties, he added.
"I assume they would take a $75 million hit plus bad publicity
seriously," Mr. Risch said. "Chump change for Apple, but nothing
to sneeze at."
Apple did not reply to Reuters' request for comment.
According to court filings, Apple has argued that the case should
not be subject to class-action status given not all retail store
managers searched bags, and that any searches took such little
time that they did not demand compensation. Judge Alsup said that
those issues could be resolved at trial.
Apple has also argued that the case did not deserve class-action
status since there were too many variations on how stores around
California conducted screenings for so many different employees.
Judge Alsup previously rejected an attempt by Apple to throw out
the case, ruling that the evidence deserved a "more comprehensive"
hearing.
Last year, in the case Integrity Staffing Solutions, Inc. v. Busk,
the US Supreme Court unanimously ruled that warehouse workers at
Amazon.com who were not compensated for time spent in security
screenings following their shifts were not owed pay from their
employer.
The court ruled that employees must only receive pay for
activities that include an "integral and indispensable part of the
principal activities for which covered workmen are employed."
Since security checks were not part of their core job
responsibilities, the Amazon employees were not owed compensation,
the court said.
APPLE INC: Judge Draws Up Trial Plan for Bag-Check Class Action
---------------------------------------------------------------
Marisa Kendall, writing for The Recorder, reports that a federal
judge on July 2 addressed what he called a "serious problem" with
a proposed wage-and-hour class action against Apple Inc., but
suggested he'd allow the case to proceed with a few tweaks.
Lawyers for a proposed class of Apple retail store workers are
demanding compensation for time workers spent having their bags
checked in post-shift security screenings. However, not every
employee brought a bag to work every day, and those who did
brought bags for different reasons.
U.S. District Judge William Alsup of the Northern District of
California proposed certifying a broad class without investigating
what was in each employee's bag. A worker who brought lifesaving
medicine would be treated the same as "the bozo who wants to bring
a backpack of playing cards to work," Judge Alsup said during a
hearing on July 2. Once a jury determines whether Apple is
required to compensate employees for bag checks, the case would
proceed to a second phase where damages would be calculated
individually based on who brought bags and how long they spent in
screenings.
"That, I could do," Judge Alsup said, though he stopped short of
ruling from the bench. "We could try that case on a class-wide
basis."
Plaintiffs argue Apple store policy requires all employees who
bring bags to work to submit to security checks after their shifts
to ensure the workers aren't pilfering Apple products. The
proposed class of California store workers seek unpaid wages for
the time spent waiting for and undergoing the checks.
McLaughlin & Stern partner Lee Shalov --
lshalov@mclaughlinstern.com -- representing plaintiffs, initially
seemed reluctant to sign onto Judge Alsup's proposed road map. But
ultimately he agreed the proposal was fair.
The new framing of the case would preclude Mr. Shalov from making
the potentially useful argument that employees had to bring bags
to work to hold medical necessities, disability accommodations,
feminine hygiene products and the shirts and lanyards Apple
required them to wear. That argument helped Shalov defeat Apple's
argument that employees shouldn't be compensated because they
voluntarily elected to submit to the screenings by choosing to
bring bags to work. On July 2, Apple's lead lawyer, Julie Dunne
-- jdunne@littler.com -- of Littler Mendelson, argued Judge
Alsup's proposal doesn't fix the suit's main problem -- the facts
of the case vary widely from plaintiff to plaintiff. She also
took issue with the damages strategy.
"If someone chooses to bring a bag they get paid, and someone who
chooses not to bring a bag doesn't get paid?" she asked.
An employee's personal choices shouldn't affect whether he or she
is eligible for compensation, Ms. Dunne argued.
Judge Alsup responded that would be a good argument for Dunne to
make during trial.
The judge also floated the idea of forgoing state-wide
certification and instead certifying a class of workers employed
at two specific Apple stores. Mr. Shalov was wary of that idea as
well, because bag check policies vary from store to store.
In December, Judge Alsup dismissed plaintiffs' federal and
New York, Massachusetts and Ohio state law claims. Only the
California law claims survived the U.S. Supreme Court's opinion in
Integrity Staffing Solutions v. Busk, which held that employers do
not have to pay workers for time in post-shift security checks.
ARKANSAS: Nurses File Overtime Suit v. Dept. of Veteran Affairs
---------------------------------------------------------------
Gordon Gibb, writing for LawyersandSettlements.com, reports that a
nurses overtime lawsuit seeking class-action status in Arkansas
will go ahead after the state's Supreme Court upheld a lower
court's ruling that class-action status is warranted.
The plaintiffs involved in the nurses overtime lawsuit claim their
employer, the Arkansas Department of Veterans Affairs (Arkansas
VA), fails to pay them for work performed before or after their
scheduled shifts. What's more, plaintiffs claim that daily,
30-minute unpaid lunch breaks to which nurses are entitled are
routinely and automatically marked as unpaid even if the
individual in question is required to work through a lunch break
due to the needs or demands of patients. The lawsuit claims that
automatically stamping lunch breaks as unpaid is a reflection of
department policy.
The Arkansas Democrat-Gazette reports that key plaintiffs in the
dispute successfully argued for class-action status given the
belief that hundreds of potential plaintiffs across the state are
experiencing the same issues, and thus would benefit from the
Nurses Wage and Hour lawsuit as a class action.
The state of Arkansas appealed the ruling to the state's highest
court, arguing that in its view there was insufficient commonality
amongst various potential plaintiffs scattered across the state to
warrant the proposed class-action status. In the state's view,
the lawsuits should proceed on an individual basis.
Attorneys for the nine plaintiffs, however, argued that Judge
Chris Palmer of the Pulaski County Circuit was correct in granting
class-action status to nurses and nursing assistants, given the
expectation that hundreds of state VA employees situated across
Arkansas may have been similarly denied overtime pay.
As it turns out, the Arkansas Supreme Court agreed, upholding the
lower court ruling and granting class-action status. The
Associated Press (AP 6/18/15) decreed in a 4-3 decision that there
was sufficient commonality amongst current and potential
plaintiffs to warrant class-action status in the Nurses Wage and
Hour lawsuit.
The Overtime Lawsuit for Nurses accuses the Arkansas Department of
Veterans Affairs of failing to pay overtime at facilities in
Little Rock and Fayetteville. The original lawsuit was brought in
2013.
ASTRAZENECA: Settles Suit Over Underpaid Rebates for $54 Million
----------------------------------------------------------------
P.J. D'Annunzio, writing for The Legal Intelligencer, reports that
pharmaceutical companies AstraZeneca and Cephalon have agreed to
pay the U.S. government and several states a combined total of $54
million to settle claims that they underpaid rebates owed under
the Medicaid Drug Rebate Program, according to the U.S. Department
of Justice.
Specifically, AstraZeneca is set to pay $46.5 million plus
interest; $26.7 million of that will go to the government while
the remainder will go to states participating in the settlement.
Cephalon, in a separate settlement from the same case, is set to
pay $7.5 million plus interest to resolve similar claims, of which
$4.3 million will go to the government while the rest is
distributed among the participating states. In total, 12 states
are part of the settlement.
Additionally, drug company Biogen has settled with whistleblower
Ronald Streck -- who alleged the companies defrauded the U.S.
government and states by underpaying Medicaid rebates -- for $1.5
million, according to a settlement agreement. The docket reflects
that Biogen had been terminated from the litigation June 18.
"The Medicaid Drug Rebate Program relies on drug manufacturers
reporting accurate pricing information used in the rebate
calculations," said principal deputy assistant attorney general
Benjamin C. Mizer -- the head of the Justice Department's Civil
Division -- in a DOJ release. "These settlements demonstrate the
Department of Justice's commitment to ensuring that state Medicaid
programs receive the full amount of rebates from manufacturers
that Congress intended."
AstraZeneca's attorney, Laena P. Keyashian of Covington & Burling
in New York, declined to comment. Alison Tanchyk of Morgan, Lewis
& Bockius, representing Cephalon, did not immediately return a
call seeking comment. A call to Biogen's media office was not
immediately returned.
Todd Collins of Berger & Montague, one of the firms representing
Streck, said the settlement came at the end of a long road.
"We have been fighting this litigation for years; we still have
more ahead of us," Mr. Collins said. "We think these are
important issues which put some money into the treasury and
hopefully can serve as a reminder to anyone in the future who
wants to put his thumb on the scale and charge too much, in this
case underpay rebates."
According to the DOJ, drug companies must pay quarterly rebates to
state Medicaid programs in exchange for Medicaid coverage of the
companies' drugs. Those rebates, the DOJ said, are partially
based on the average manufacturer prices, or AMPs, that drugmakers
report to the government for each of their covered drugs.
"Generally, the higher the reported AMP for a drug, the greater
the rebate the manufacturer pays to state Medicaid programs for
the drug," the DOJ said in a written statement. "These
settlements resolve allegations that AstraZeneca and Cephalon
underreported AMPs for a number of their drugs by improperly
reducing the reported AMPs for service fees they paid to
wholesalers. As a result, the government contends that
AstraZeneca and Cephalon underpaid quarterly rebates owed to the
states and caused the United States to be overcharged for its
payments to the states for the Medicaid program."
According to Mr. Collins, the government has not yet released
Biogen from litigation, despite its settlement with Streck.
ASTRAZENECA: Delaware Court Tosses Consumer Fraud Class Action
--------------------------------------------------------------
Gina Passarella, writing for Delaware Business Court Insider,
reports that almost 11 years after the suit was filed, a Delaware
court has dismissed a class action against AstraZeneca over its
alleged consumer fraud in the marketing of heartburn medication
Nexium.
Superior Court Judge Vivian L. Medinilla said there was just not
enough evidence to show that the plaintiffs -- a group of four New
York-based health care funds -- relied on any alleged
misrepresentation by AstraZeneca that Nexium was a better drug
than the over-the-counter version of Prilosec.
In applying New York law to the plaintiffs' consumer fraud claims
in Teamsters Local 237 Welfare Fund v. AstraZeneca
Pharmaceuticals, Judge Medinilla said the state's General Business
Law doesn't require individual reliance on misrepresentations, but
at least "some awareness" of the misrepresentation. Judge
Medinilla said the complaint did not detail any advertising the
health care funds or their members' doctors may have seen before
the funds made the decision to reimburse their members for Nexium.
"Therefore, any purported chain of causation that runs from the
allegedly deceptive advertisements that may have influenced the
decisions of individual doctors to prescribe a drug to their
patients to causally affect the payer unions in this case is
simply too attenuated," Judge Medinilla said.
She ruled similarly on the plaintiffs' claims for unjust
enrichment and negligent misrepresentation, with the only
difference being she applied Delaware law to the negligent
misrepresentation claim.
AstraZeneca is the manufacturer of heartburn medication Prilosec,
the patent on which expired in 2001. The four union health and
benefit funds that sued AstraZeneca in November 2004 alleged
AstraZeneca engaged in consumer fraud by introducing an
"essentially identical drug," Nexium, when the over-the-counter
version of Prilosec became available. The plaintiffs claimed
AstraZeneca falsely represented Nexium as superior to Prilosec in
an effort to maintain market share after Prilosec's patent
expired, according to the opinion.
The original complaint was filed in November 2004 with an amended
complaint filed in February 2005. AstraZeneca moved to dismiss
the case, but by May 2005, the court granted a stipulated order
staying the case because of parallel litigation ongoing in the
U.S. District Court for the District of Delaware. The federal
litigation involved a putative class of plaintiffs from
Pennsylvania, New York and Michigan.
AstraZeneca had sought dismissal of the federal case on pre-
emption grounds. It was dismissed, went up to the U.S. Supreme
Court and remanded after the high court ruled in Wyeth v. Levine
that not all state consumer protection laws are pre-empted by
federal law. In May 2010, the district court again dismissed the
complaint, applying the law of the plaintiffs' home states and
ruling the complaint showed no causal connection between the
alleged misrepresentation and the decision to purchase Nexium over
Prilosec. The plaintiffs in that case did not file an amended
complaint or appeal, Judge Medinilla said.
In August 2010, the Superior Court granted the Teamsters Local
plaintiffs' motion to lift the stay in their case. It was
granted, but more than three years passed with no action taken by
either party in the case. In October 2013, AstraZeneca moved to
dismiss the case for failure to prosecute and that was denied. A
second amended complaint was filed in April 2014.
The second amended complaint alleged violations of the Delaware
Consumer Fraud Act as well as violations of 14 individual state
consumer protection statutes where the funds' members purchased
Nexium. There were also claims for unjust enrichment and
negligent misrepresentation.
The new complaint also made additional factual allegations that
AstraZeneca engaged in an illegal reverse-payment settlement with
generic manufacturers of Nexium in 2008. The drug company removed
the case to federal court after that, arguing there was federal
jurisdiction under the Class Action Fairness Act of 2005 because
of the new claims. The district court granted the plaintiffs'
motion to remand, finding the new claims on the reverse-payment
settlement related back to when the case was filed, and that was
before CAFA was enacted.
The Superior Court then heard arguments in April 2015 on
AstraZeneca's motion to dismiss the case.
Judge Medinilla rejected the plaintiffs' arguments that the laws
of the 14 states where the members purchased the drug should
apply, finding the union health plans were for current and former
New York City employees. While some of them may now live
elsewhere, New York had the most interest in enforcing its
consumer protection law in this case, she said.
The judge also rejected the plaintiffs' argument that Delaware law
should apply, finding the plaintiffs are headquartered in
New York, their decisions to reimburse for Nexium were made in
New York and they made the payments from New York. That
outweighed the fact that AstraZeneca is based in Delaware and the
plaintiffs' members purchased the drug outside of New York in some
instances, the judge ruled.
Applying New York law doomed the plaintiffs' case because of the
reliance requirement. Delaware law, on the other hand, does not
require any sort of reliance to prove consumer fraud claims,
Judge Medinilla noted.
Judge Medinilla said she would dismiss the case with prejudice,
finding the plaintiffs had ample opportunity to amend their
pleadings since 2004 and given the case sat idle for three years.
Michael P. Kelly -- mkelly@mccarter.com -- of McCarter & English
in Wilmington represented AstraZeneca. He said the judge issued a
thoughtful and well-reasoned opinion. Mr. Kelly said there was a
"complete failure of proof," with no deceptive ads and no damages
caused by any ads.
A. Zachary Naylor -- ZN@chimicles.com -- of Chimicles & Tikellis
in Wilmington represented the plaintiffs and did not return a call
seeking comment.
AXA EQUITABLE: Discovery Ongoing in "Yale" Class Action
-------------------------------------------------------
AXA Equitable Life Insurance Company said in its Form 10-Q Report
filed with the Securities and Exchange Commission on May 8, 2015,
for the quarterly period ended March 31, 2015, that discovery is
ongoing in the insurance class action litigation filed by Andrew
Yale.
In April 2014, a lawsuit was filed in the United States District
Court for the Southern District of New York, entitled Andrew Yale,
on behalf of himself and all others similarly situated v. AXA Life
Insurance Company F/K/A AXA Equitable Life Insurance Company. The
lawsuit is a putative class action on behalf of all persons and
entities that, between 2011 and March 11, 2014, directly or
indirectly, purchased, renewed or paid premiums on life insurance
policies issued by AXA Equitable (the "Policies"). The complaint
alleges that AXA Equitable did not disclose in its New York
statutory annual statements or elsewhere that the collateral for
certain reinsurance transactions with affiliated reinsurance
companies was supported by parental guarantees, an omission that
allegedly caused AXA Equitable to misrepresent its "financial
condition" and "legal reserve system." The lawsuit seeks recovery
under Section 4226 of the New York Insurance Law of all premiums
paid by the class for the Policies during the relevant period.
In June 2014, AXA Equitable filed a motion to dismiss the
complaint on procedural grounds, which was denied in October 2014.
In February 2015, plaintiffs substituted two new named plaintiffs
for the current named plaintiff, Mr. Yale, who had determined that
he could not serve as the named plaintiff and class representative
in the case.
In March 2015, AXA Equitable filed a motion to dismiss on
substantive grounds, whereupon the court permitted plaintiffs to
file an amended pleading, which they did in March 2015. In April
2015, AXA Equitable filed a motion to dismiss the amended
complaint. That motion is pending. In March 2015, plaintiffs filed
a motion for class certification, which is also pending. Discovery
is on-going.
AXA EQUITABLE: Faces "Yarbrough" Class Action
---------------------------------------------
AXA Equitable Life Insurance Company said in its Form 10-Q Report
filed with the Securities and Exchange Commission on May 8, 2015,
for the quarterly period ended March 31, 2015, that in April 2015,
the plaintiffs' law firm in the lawsuit filed by Andrew Yale,
filed in the same court a second action on behalf of a putative
class of variable annuity holders with "Guaranteed Benefits
Insurance Riders," entitled Calvin W. Yarbrough, on behalf of
himself and all others similarly situated v. AXA Equitable Life
Insurance Company. The new action covers the same class period,
makes substantially the same allegations, and seeks the same
relief (return of all premium paid by class members) as the first
action on behalf of life insurance policyholders.
BANK OF AMERICA: Announces Initial Distribution of Settlement Fund
------------------------------------------------------------------
The following statement is being issued by Bernstein Litowitz
Berger & Grossmann LLP, Kaplan Fox & Kilsheimer LLP, and Kessler
Topaz Meltzer & Check, LLP regarding the In re Bank of America
Corp. Securities Litigation.
UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK
IN RE BANK OF AMERICA CORP. SECURITIES, DERIVATIVE, AND EMPLOYEE
RETIREMENT INCOME SECURITY ACT (ERISA) LITIGATION
Master File No. 09 MDL 2058 (PKC)
ECF CASE
THIS DOCUMENT RELATES TO:
Consolidated Securities Action
NOTICE OF INITIAL DISTRIBUTION OF NET SETTLEMENT FUND
TO: ALL PERSONS AND ENTITIES WHO SUBMITTED A PROOF OF CLAIM AND
RELEASE FORM IN CONNECTION WITH THE SETTLEMENT OF THE ABOVE-
CAPTIONED ACTION.
PLEASE READ THIS NOTICE CAREFULLY. YOUR RIGHTS MAY BE AFFECTED.
An initial distribution of the Net Settlement Fund in the In re
Bank of America Corp. Securities Litigation, Master File No. 09
MDL 2058 (PKC), recently has been made to all Class Members who
submitted a Claim Form to the Claims Administrator, Garden City
Group, LLC, and who did not receive a notice from the Claims
Administrator that (i) their Claim had been recommended for
complete rejection; (ii) the amount of their Claim fell below the
minimum level to receive a payment; or (iii) because their Claim
had been received after November 5, 2014, it was not eligible for
payment in the distribution.
If you submitted a Claim Form to the Claims Administrator and you
did not receive any of the notices mentioned above, and you have
not yet received an initial distribution check, you must, by
August 15, 2015, notify the Claims Administrator, as follows:
In re Bank of America Corp. Securities Litigation
c/o Garden City Group, LLC
P.O. Box 9876
Dublin, OH 43017-5776
Tel: 1-855-733-8308 (toll free)
FAILURE TO NOTIFY THE CLAIMS ADMINISTRATOR BY AUGUST 15, 2015 THAT
YOU SUBMITTED A CLAIM FORM AND DID NOT RECEIVE ANY OF THE NOTICES
NOTED ABOVE, BUT DID NOT RECEIVE AN INITIAL DISTRIBUTION CHECK,
WILL RESULT IN THE FORFEITURE OF YOUR ENTIRE CLAIM.
Co-Lead Counsel identified below are available to answer questions
concerning the initial distribution or other claims processing
matters:
Bernstein Litowitz Berger & Grossmann LLP
1285 Avenue of the Americas
New York, NY 10019
Rochelle Feder Hansen, Esq.
(212) 554-1407
David L. Duncan, Esq.
(212) 554-1464
Kaplan Fox & Kilsheimer LLP
850 Third Avenue, 14th Floor
New York, NY 10022
Robert N. Kaplan, Esq.
(212) 687-1980
Frederic S. Fox, Esq.
(212) 687-1980
Kessler Topaz Meltzer & Check, LLP
280 King of Prussia Road
Radnor, PA 19087
David Kessler, Esq.
(610) 667-7706
Sharan Nirmul, Esq.
(610) 667-7706
PLEASE DO NOT CONTACT THE COURT REGARDING THIS NOTICE.
By Order of the Court
BAYER CROPSCIENCE: Judge Certifies Class in Settlement Dispute
--------------------------------------------------------------
Scott Flaherty, writing for The Litigation Daily, reports that fee
fights among plaintiffs lawyers aren't unusual. But the fight
that has followed Bayer CropScience's $750 million settlement of
litigation over rice crop contamination has entered rarefied air.
In a battle over $72 million in fees, a St. Louis federal judge on
July 14 certified a class of plaintiffs firms to pursue unjust
enrichment claims against another set of plaintiffs firms.
The dispute traces back to 2006, when Bayer revealed that traces
of its genetically modified rice strain had contaminated other
long-grain rice crops in the southern United States. Some 8,000
rice farmers filed suits against Bayer, and most of them were
consolidated into multidistrict litigation. Bayer settled the MDL
in 2011 for $750 million. Other suits, including some in state
courts, produced separate settlements.
U.S. District Judge Catherine Perry in St. Louis, who presided
over the MDL, ordered the establishment of a fund to reimburse
Downing, Levitt and others for legal work they did that benefited
all of the plaintiffs. The judge required that the farmers'
lawyers contribute a share of any money they got from Bayer, on
the theory that they were able to use and benefit from discovery
and other work performed by the MDL lawyers. But this requirement
didn't explicitly apply to all actions outside the MDL, including
the state court cases.
Problems arose when the lawyers who led the MDL litigation --
Gray, Ritter & Graham and Wolf Haldenstein Adler Freeman & Herz --
claimed that some firms weren't contributing their fair share to
this collective fund and brought a lawsuit in 2013.
The defendant law firms include Texas-based Goldman Phipps, which
had unsuccessfully pushed for a $13 million share of the $72
million fee award. The firm struck out at the U.S. Court of
Appeals for the Eighth Circuit, which also found that
Goldman Phipps could be forced to contribute to this common fund.
The firm's attempt to get the Supreme Court to grant cert fizzled.
In her ruling on July 14, Judge Perry found that the law firms
that brought this suit did work that ultimately helped all lawyers
on the plaintiffs' side. She noted that they drafted a master
consolidated complaint, took part in more than 160 depositions,
and conducted three bellwether trials that each resulted in
verdicts for the farmers.
Lawyers for the plaintiff law firms declined to comment on
July 15. Michael Vitale of Herzog Crebs -- mav@herzogcrebs.com --
one of the lead defense lawyers, didn't immediately respond to a
request for comment.
BELL MOBILITY: Loses Bid to Overturn 911 Fee Court Ruling
----------------------------------------------------------
The Canadian Press reports that Bell Mobility Inc. has lost
another bid to overturn a ruling that held it liable for charging
customers in the northern territories a 911 fee without actually
offering the emergency-call service.
The Supreme Court of Canada refused on July 16 to hear the
company's challenge of a Northwest Territories Court of Appeal
ruling.
As usual, the high court gave no reason for declining to hear the
appeal.
In most of the Northwest Territories, the Yukon and Nunavut, there
is no 911 service.
Instead, a 911 call may be answered by a recorded message.
However, for several years monthly bills carried a 75-cent charge,
prompting a class-action lawsuit by subscribers.
A trial judge ruled Bell Mobility had breached its contractual
obligations, a decision that was upheld by the appeal court.
BERNARD MADOFF: Konigsberg May Receive Leniency in Fraud Case
-------------------------------------------------------------
The Associated Press reports that a 79-year-old New York
accounting firm executive who worked for some of Bernard Madoff's
most important clients is likely to receive leniency at his
sentencing in return for government cooperation.
Paul Konigsberg was set for sentencing on July 9 in Manhattan
federal court after pleading guilty last year to conspiracy and
falsifying books and records. He sold his Manhattan accounting
and consulting firm four years ago.
Prosecutors agree he did not know about Mr. Madoff's epic fraud
that cost thousands of investors nearly $20 billion. But they say
he unwittingly helped it along by conspiring with Madoff employees
to produce fraudulent investor statements.
Prosecutors recommended leniency, saying Konigsberg provided vital
facts toward the prosecution of others.
The 77-year-old Madoff is serving a 150-year prison sentence after
revealing the fraud in December 2008.
BP PLC: Litigation Continues Over $9BB Private Claims Settlement
----------------------------------------------------------------
Zoe Tillman, writing for The National Law Journal, reports that BP
PLC has agreed to pay more than $18.7 billion to resolve civil
claims with the federal government and five Gulf states related to
the 2010 Deepwater Horizon oil spill.
The deal, if approved, would be the largest settlement with a
single entity in U.S. history, according to a statement from
Attorney General Loretta Lynch. DOJ said it could take several
months to formalize the agreement into a consent decree to present
to the court. The public will have an opportunity to weigh in
before it goes to U.S. District Judge Carl Barbier in New Orleans
for final approval.
"Since the Deepwater Horizon oil spill -- the largest
environmental disaster in our nation's history -- the Justice
Department has been fully committed to holding BP accountable, to
achieving justice for the American people and to restoring the
environment and the economy of the Gulf region at the expense of
those responsible and not the American taxpayer," Ms. Lynch said.
The Justice Department filed civil claims against BP over the
spill in 2010 in the U.S. District Court for the Eastern District
of Louisiana. Litigation continues over a $9 billion settlement
to resolve private civil claims filed against the oil company.
The agreement announced on July 2 breaks down into four
categories: a $5.5 billion penalty under the federal Clean Water
Act; $8.8 billion for natural resource damages; $5.9 billion to
settle claims with state and local governments for economic
damages; and $600 million for other claims, including various
federal expenses related to the spill.
CADIZ INC: Defending Against "Van Wingerden" Class Action
---------------------------------------------------------
Cadiz Inc. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that a putative class action lawsuit,
entitled Van Wingerden v. Cadiz Inc., et al., No. 2:15-cv-03080-
JAK-JEM, was filed on April 24, 2015, against Cadiz and certain of
its directors and officers ("Defendants") in the United States
District Court for the Central District of California purporting
to assert claims for violation of Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder. The complaint, which purports to be brought on behalf
of all Cadiz shareholders, alleges that the Defendants have made
false and misleading statements regarding the Company's business
and prospects. The complaint seeks unspecified monetary damages
and other relief. The Company believes that the purported class
action lawsuit is without merit and intends to vigorously defend
the action.
While the Company believes that the purported class action lawsuit
is without merit, pursuant to applicable accounting requirements,
the Company will evaluate this matter on an ongoing basis and
record accruals for contingencies if the Company concludes that it
is probable that a material loss will be incurred and the amount
of the loss can be reasonably estimated. In many situations,
including the purported class action, such matters are being
contested, the outcome is not predictable and any potential loss
is not estimable.
CANADA: Sued Over Inadequate Care for Mentally Ill Prisoners
------------------------------------------------------------
Diana Mehta, writing for The Canadian Press, reports that a
proposed class-action lawsuit filed in an Ontario court on July 17
alleges the federal government fails to provide adequate care to
mentally ill prisoners while relying far too heavily on solitary
confinement as a way to deal with them.
The case, if certified by the court, would pit the Attorney
General of Canada against federal inmates diagnosed with mental
illness between 1992 and the present.
"Prisoners in federal institutions who suffer serious mental
illness are not being given the treatment they are statutorily
entitled to," said lawyer James Sayce -- jsayce@kmlaw.ca -- whose
firm, Koskie Minsky, is behind the action. "It's a problem that
can't be ignored anymore."
The lawsuit, which contains allegations not proven in court, is
seeking at least C$600 million in damages and estimates hundreds
of mentally ill prisoners could be part of the action if it is
certified.
"They are being warehoused and they are being subjected to
extended periods of time in solitary confinement because the
federal prison system doesn't know what to do with them," said
Mr. Sayce. "The effect is . . . the illnesses get worse, and you
have serious pain and emotional stress being suffered by these
unwell inmates."
A statement of claim filed on July 17 alleges that those tasked
with caring for mentally ill inmates in federal prisons have
treated them with "contempt, prejudice, indifference and abuse."
It claims prison staff are unqualified to administer, control,
protect and care for mentally ill inmates and instead rely almost
exclusively on "force, compliance and behavioral inducement
methods."
It also alleges that extended periods of solitary confinement are
used to "contain and manage" mentally ill prisoners.
It alleges the practice amounts to "cruel and unusual punishment"
for mentally ill prisoners and claims that the government is
failing in its mandate to rehabilitate rather than punish
prisoners.
"Federal penitentiaries are becoming Canada's largest repositories
for the mentally ill," the statement of claim said. "Prisoners
diagnosed with serious psychological disorders and illnesses have
suffered severe harm as a result of the defendant's policies and
procedures."
The statement of claim also alleges mentally ill inmates face
interruptions in care when they are admitted to and transferred
between institutions, which lead to them being denied medication
for an extended period, and are also allegedly denied commonly
prescribed psychiatric drugs.
The representative plaintiff in the case, Christopher Brazeau, is
a prisoner at an institution in Edmonton. The 34-year-old suffers
from post-traumatic stress disorder, generalized anxiety disorder
and attention deficit and hyperactivity disorder, said the
statement of claim.
He is serving a sentence of 12 years for robbery-related crimes.
He has spent 12 consecutive months in solitary confinement, has
gone long periods without his necessary medications and has
"regularly" been prescribed unsuitable medications, the statement
of claim said.
"Mr. Brazeau suffered significant worsening of his mental health
problems during his time in solitary confinement, including
anxiety, depression, self-harm, suicidal thoughts and visual and
auditory hallucinations," the statement of claim alleged.
"It is likely that Mr. Brazeau's condition will continue to
deteriorate as a result of Canada's failure to create and
implement policies that allow for the provision of proper health
care."
CAY CLUBS: Trial Begins in $300-Million Fraud Case
--------------------------------------------------
Curt Anderson, writing for The Associated Press, reports that a
federal trial began on July 8 for a married couple accused of
orchestrating a $300 million fraud involving thousands of
investors who were promised big profits by purchasing dilapidated
properties in the Florida Keys and elsewhere that would be
transformed into luxurious resorts.
Instead, prosecutors say Fred Davis "Dave" Clark Jr., former
president of now-defunct Cay Clubs Resorts and Marinas, and
Cristal Clark, a top sales agent, defrauded banks and about 1,400
individual investors through a series of misleading marketing
materials and false statements. The investors in some cases were
promised quick returns of 15 to 20 percent, according to court
documents.
One such brochure, according to the documents, trumpeted that
Clearwater-based Cay Clubs would allow people to "Retire Rich and
Young in Paradise!" In fact, Assistant U.S. Attorney Jerrob Duffy
told jurors in an opening statement, the company knew as early as
2007 it could not meet all its obligations and would never
transform its decayed properties into luxury resorts.
"This case is about greed. It is about lies and deception,"
Mr. Duffy said. "It is about telling those lies to others so the
defendants could get rich on other people's money."
Eventually, the company allegedly became a Ponzi scheme in which
money from newer investors was used to pay off older ones, with no
new profits or loans coming in. The company's resorts were
supposed to be in 17 locations in Florida, Las Vegas and the
Caribbean.
The Clarks previously pleaded not guilty to bank fraud, mail fraud
and conspiracy charges. If convicted, they each face potentially
decades in federal prison. The trial before U.S. District Judge
Jose E. Martinez is expected to last about six weeks.
Dave Clark's attorney, Valentin Rodriguez, said the planned Cay
Clubs developments were legitimate, had been appraised by banks,
and only appeared to be selling at highly inflated prices because
of the real estate bubble of the mid-2000s. The company's
problems and eventual collapse, he said, were caused by the
financial recession, not any criminal acts.
"Yes, Cay Clubs failed. Failure is not a crime," Mr. Rodriguez
said. "Mr. Clark was completely forthright in everything he did."
Cristal Clark's attorney, Assistant Federal Public Defender
Manuel Arteaga-Gomez, said she relied on her husband and her
husband's financial and legal advisers for the actions she took.
"She never intended to defraud any banks, any people who purchased
units," he said. "She's innocent."
In June 2014, Dave Clark was extradited from Panama and Cristal
Clark from Honduras to face the U.S. charges and have been jailed
as flight risks ever since. After Cay Clubs failed, Dave Clark
and two partners formed a Cayman Islands-based company that opened
a string of pawn shops across the Caribbean known as CashWiz.
Some of the fraud charges against the Clarks stem from that
business. Mr. Duffy told jurors the couple was illegally
siphoning off for themselves cash the company was making buying
and selling gold. Eventually the partners forced Dave Clark out
after the Securities and Exchange Commission filed a lawsuit
against him over Cay Clubs.
Two former Cays Club executives -- Barry J. Graham and Ricky Lynn
Stokes, both of Fort Myers -- were sentenced to five years each in
prison in March after pleading guilty to their roles in the
scheme. Both agreed to cooperate with prosecutors in return for
lighter sentences and are expected to testify.
CENTURY CITY: ILG Ordered to Disgorge $15MM in Attorney Fees
------------------------------------------------------------
Scott Graham, writing for The Recorder, reports that a
San Francisco judge has come down hard on a Century City class
action firm, ordering it to disgorge to class members more than $5
million that it "attempted to arrogate to itself" as attorney
fees.
Superior Court Judge Mary Wiss ruled on July 16 that Initiative
Legal Group struck a $6 million deal to settle 600 individual
clients' wage-and-hour claims with Wells Fargo Home Mortgage, then
shunted the clients into a related class action against the bank
where they received lower payouts. The firm, known as ILG, kept
$5 million, saying it was compensation for years of work on
several wage-and-hour cases against Wells Fargo.
"Having concealed its purported fee agreement from the court and
having tried to appropriate those funds to itself without court
approval, this court determines that ILG is not entitled to any of
the claimed fees," Judge Wiss wrote.
Instead, the money must be paid to class members in Lofton v.
Wells Fargo Home Mortgage, No. 11-509502.
The July 16 decision culminates three years of wrangling by
San Francisco solo practitioner Richard Zitrin and Mark Chavez --
mark@chavezgertler.com -- of Mill Valley's Chavez & Gertler, who
represent the family of former ILG client David Maxon. Messrs.
Chavez and Zitrin have accused ILG attorneys of severe misconduct
and said they were personally gratified by the July 16 ruling.
Judge Wiss "chose to act decisively, which I think this case calls
for," Mr. Chavez said.
"Some measure of justice was done," said Mr. Zitrin, who is
pursuing separate malpractice actions against ILG.
Klinedinst partner Natalie Vance, who represents ILG, said the
firm is studying its options, including a possible appeal. "ILG
continues to dispute that the class action court here had
authority to take control of the fees ILG earned and its clients
agreed to for representation in their individual cases litigated
in other counties around the state," she said.
Lofton is a class action that was brought by other attorneys on
behalf of home-mortgage consultants in San Francisco Superior
Court in 2005. ILG brought similar, individual suits on behalf of
600 consultants. The cases were mediated together in 2011, with
the Lofton class action settling for $19 million -- about $2,000
per class member after fees and expenses -- and ILG's cases
settling for $6 million -- or about $10,000 per plaintiff before
fees and expenses.
In seeking approval from S.F. Superior Court Judge Loretta Giorgi,
the attorneys said they expected the consultants represented by
ILG to opt out of the Lofton settlement and collect from the ILG
fund. But none of them did because ILG instead encouraged them to
file class claims. Meanwhile, ILG kept all of the $6 million as
its attorney fees, save a $750 payment to each plaintiff in
exchange for a release of claims. One plaintiff, Maxon, refused
the payment, leading ILG to offer an additional $1,000 to all of
the plaintiffs a few months later.
Judge Wiss ruled on July 16 that disgorgement was "the inevitable
conclusion" given the facts. She also nodded to the First
District Court of Appeal, which refused last year to dissolve a
TRO freezing the funds. "As stated by the Court of Appeal, 'there
is a question on this record whether ILG is entitled to any fees
at all,'" Judge Wiss wrote. "Given the record before it, this
court concludes that the answer to that question is 'no.'"
The releases signed by ILG clients are immaterial, she wrote. "It
does not matter that some ILG clients 'agreed' to an 'allocation'
of more than $5 million in fees to ILG . . . Approval of ILG's
class action attorneys' fees was the exclusive province of this
court, not ILG's clients."
ILG also argued that due process required a trial on the issue.
But, Judge Wiss wrote, "courts routinely determine the entitlement
to class action attorneys' fees through motions. As class action
lawyers, ILG knows (or should know) that class action attorney's
fees require court approval."
ILG never made an application for fees, even after Judge Wiss
offered the firm a chance, the judge wrote. Nor did ILG attorneys
Marc Primo, G. Arthur Meneses, Monica Balderrama and Joseph Liu
accept her invitation to speak on their own behalf at a June 24
hearing. "In the absence of an offer of evidence to support its
claim to fees, this court can only conclude there is none,"
Judge Wiss wrote.
In addition to the $5 million, ILG will have to kick in an
additional $500,000 to reimburse the class for the $1,000 payments
ILG made to get releases from its 600 clients.
CHANEL INC: Faces Class Action Over Labor Violations
----------------------------------------------------
Kevin Penton, writing for Law360, reports that shipping department
employees at Chanel Inc.'s store on Rodeo Drive in Beverly Hills,
California, hit the company with a proposed class action on
July 16 in California state court, saying the company stiffed them
out of overtime and break periods.
Chanel violated California's wage and labor laws and the state's
Unfair Competition Law by failing to pay overtime and to provide
rest breaks for shipping employees, by failing to provide required
adequate wages, not providing accurate payroll records and
engaging in unlawful business practices for unfair competition.
CITIZENS FINANCIAL: Defending TCPA Case in S.D. Calif.
------------------------------------------------------
Citizens Financial Group, Inc. is vigorously defending a Telephone
Consumer Protection Act case in California, the Company said in
its Form 10-Q Report filed with the Securities and Exchange
Commission on May 8, 2015, for the quarterly period ended March
31, 2015.
The Company is a defendant in a purported class action complaint
filed in December 2013 in the United States District Court for the
Southern District of California pursuant to the Telephone Consumer
Protection Act. The named plaintiff purports to represent a
"national class" of customers who allegedly received automated
calls to their cell phones from the bank or its agents, without
customer consent, in violation of the Telephone Consumer
Protection Act. The Company is vigorously defending this matter,
but is unable to predict the outcome of this matter.
CITIZENS FINANCIAL: Defending Class Suit Over LIBOR
---------------------------------------------------
Citizens Financial Group, Inc. is vigorously defending a LIBOR
related class action lawsuit, the Company said in its Form 10-Q
Report filed with the Securities and Exchange Commission on May 8,
2015, for the quarterly period ended March 31, 2015.
The Company is a defendant in lawsuits in which allegations have
been made that RBS manipulated U.S. dollar LIBOR to the detriment
of the Company's customers. The lawsuits include a purported class
action on behalf of borrowers of the Company whose interest rates
were tied to U.S. dollar LIBOR. The plaintiffs in these cases
assert various theories of liability, including fraud, negligent
misrepresentation, breach of contract, and unjust enrichment. The
Company is vigorously defending these matters, but is unable to
predict the outcome of these matters.
COHN FYVOLENT: Ordered to Pay $1.5MM in Legal Malpractice Case
--------------------------------------------------------------
Greg Land, writing for Daily Report, reports that a Fulton County
jury ordered a local lawyer to pay $1.5 million to a pair of
investors whose money disappeared along with their dreams of a big
payoff from a failed Costa Rican resort.
The jury found attorney S. Alan Cohn and his former firm, Cohn,
Fyvolent & Shaver, liable for claims of legal malpractice and
breach of fiduciary duty stemming from Cohn's role in the ill-
fated investment in the Santosha Resort development. It was to
have been a 697-acre spread of individual hand-carved "estates"
imported from Bali, boasting swimming pools, clubs and a recording
studio, on Costa Rica's Golfito Bay.
Cohn, Fyvolent has since been absorbed by Aldridge Pite, a
multistate firm specializing in financial and real estate law.
Hawkins Parnell Thackston & Young senior partner Elizabeth O'Neill
-- eoneill@hptylaw.com -- who defended Mr. Cohn and the firm with
Hawkins Parnell partner Kathryn Whitlock, said they would be
filing post-trial motions that may include an appeal. She said
she couldn't discuss the case further.
The plaintiffs' lawyer, Stephen Katz -- SMKATZ@SMK-LAW.COM -- of
Marietta's Katz Law group, said he was not at liberty to discuss
the case.
According to multiple court filings, related news accounts and a
synopsis of the trial put together by Courtroom View Network, the
case began in mid-2008 when investors Eli Peretz, a housing
renovation contractor, and Nick Gabbay, a foot and ankle surgeon,
hired Cohn to look into an opportunity to invest in the
development. It was being put together by Lifestyles Ventures
Cayman, one of several projects linked to California-based
Lifestyles Real Estate of Santa Cruz.
Other Lifestyles projects -- Lifestyles Ventures, Lifestyles
Ventures Avondale and Lifestyles Ventures at Victory Landing --
included at least two Georgia properties. Four men -- Paul
Locatelli, Peter Gaeckle, Brian Diego and Andy Kay, referred to at
trial as the "California Group" -- were principals in all of the
projects.
According to the plaintiffs' filings, Messrs. Peretz and Gabbay
were adamant that they would invest only if they were provided
with a guaranty from the California group. The four told Cohn
that they could not personally guarantee the $1.5 million loan
they were seeking, but that they would place assorted residential
properties they owned in Georgia, Florida and elsewhere into a
limited liability company, LGDK, to secure the debt.
Mr. Cohn put together an LLC to serve as the investment body for
Messrs. Peretz and Gabbay, called Elite at Golfito Bay, and in
July 2008 presented them with a note and guaranty stating that the
estimated worth of LGDK was $2.1 million.
The complaint said Mr. Cohn advised Messrs. Peretz and Gabbay that
the four LGDK principals were "good guys" who could be trusted and
encouraged them to invest in the deal "stating, among other
things, words to the effect, 'You're going to make a lot of
money.'"
But according to the plaintiffs, there were two big problems
Mr. Cohn didn't tell them about: there was no "LGDK LLC," and the
properties its members had put up for security were all subject to
prior liens.
"[Cohn] drafted a guaranty for $1.5 million and advised plaintiffs
to accept the guaranty when Cohn had not even bothered to check
whether the corporate guarantor actually existed. It didn't,"
said the plaintiff's portion of the pretrial order. "Even worse,
Mr. Cohn knew that the company that was actually supposed to serve
as the corporate guarantor had no value because all of the real
estate it owned was 'under water.' In other words, the existing
company that might have supplied a corporate guaranty was
insolvent and could not guarantee anything."
Mr. Peretz put up $1 million and Mr. Gabbay pitched in $500,000,
which was transferred to Lifestyles Ventures Cayman.
By 2010, the project was in trouble, and Lifestyles Ventures
Cayman, LGDK and two of its principals would ultimately file for
bankruptcy protection. Trial exhibits included a 2011 order from
the Grand Court of the Cayman Islands appointing liquidators to
oversee the disposal of the assets of Lifestyles Ventures Cayman,
and a 2013 document estimating the value of the Costa Rica
property at that time to be about $800,000.
"In its current state of overgrowth, a lack of maintenance and
general upkeep, and outstanding and past expenses associated with
a possible sale, that value may prove very difficult to realize,"
the 2013 document said.
In June 2012, Mr. Katz filed the investors' suit in Fulton County
State Court accusing Cohn and his firm of legal malpractice,
breach of fiduciary duty and breach of contract. The breach of
contract claim was apparently dropped over the course of the
litigation.
The complaint said that, at the time he was consulting with
Messrs. Peretz and Gabbay, Mr. Cohn also had a fiduciary
relationship with the California Group and their companies, and he
should have advised the plaintiffs to seek independent counsel.
The suit also said Cohn was well aware of the finances of the
California Group and their companies, and should have investigated
their claims as to the value of their properties.
The complaint said that LGDK had been incorporated in Florida but
had been dissolved, and that a related company, LGDK Investors
Inc. "had a negative net worth of approximately $1.3 million" when
the promissory note was signed.
According to the defendants' portion of the pretrial order,
Messrs. Peretz and Gabbay were well aware that the "high-risk,
high-return, unsecured investment" was "boldly marketed as
speculative and uncertain." Their suit was an effort "to force a
lawyer who played a scrivener's role in the transaction to bear
its burden."
The pair had invested in the deal despite its risks because they
wanted to "get rich quick," it said.
As to their claims that Mr. Cohn had a conflict of interest, "even
plaintiffs' expert agrees that no rule or law prohibits Mr. Cohn
from having more than one client or even more than one client in
any given deal," it said. In relation to the Costa Rica project,
it said, Cohn "represented only Mr. Peretz and Elite at Golfito
Bay (and perhaps Dr. Gabbay), but not the California Group. There
was, therefore, no prohibited conflict in his representation in
this deal."
In any case, the defense said, nothing Cohn had done had caused
the investors to lose their money. "Lifestyles Ventures Cayman,
LGDK, Gaeckle and Locatelli filed for bankruptcy and there is no
information about the finances of Kay and Diego," said the defense
account. "This was totally unrelated to anything Mr. Cohn did or
failed to do, but means that plaintiffs have no source of recovery
and would have had none even if Mr. Cohn had gotten for them a
different guarantee."
During a four-day trial before Judge Jay Roth, Cohn denied that he
had said the investment was a good deal, according to the
Courtroom View synopsis. He said he had told Mr. Peretz about the
liens on the LGDK properties. He also denied having worked with
the California Group or their projects prior to the Costa Rican
deal, it said, but confirmed that he had worked with them
afterward.
On June 12, the jury found for the plaintiffs on the legal
malpractice and breach of fiduciary claims, awarding Peretz $1
million plus $2,900 in attorney fees, and Gabbay $500,000.
While the Costa Rica project is long since dead, a 2010 website
touting the wonders of the Santosha Resort remains very much
alive, with beautiful pictures of tropical villas, fiery red
sunsets and vistas of beach and rainforest fading into each other.
A California real estate agent cited on the website as the contact
for interested purchasers was baffled when asked about the resort.
Jim McInerney with Pacific Sotheby's International Realty in La
Jolla said he had been involved with the project in 2008 and 2009.
"I was going to help handle sales and promotions," said
Mr. McInerney via email. "The development was never fully funded
and fell apart. I have not been involved since and don't know
what has happened. Not sure why the website is still up."
The website explains that "santosha" is an ancient Sanskrit word
meaning "complete contentment."
COMMUNITY BANK: Agreement in Principle Reached in M.D. Pa. Suits
----------------------------------------------------------------
Community Bank System, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that the Bank has
reached an agreement in principle to settle the first of two
related class actions pending in the United States District Court
for the Middle District of Pennsylvania which were commenced
October 30, 2013 and May 29, 2014, respectively.
The first action alleged that notices provided by the Bank in
connection with the repossession of the named plaintiff's
automobile failed to comply with certain requirements of the
Pennsylvania and New York Uniform Commercial Code (UCC) and
related statutes. The plaintiff sought to pursue the action as a
class action on behalf of herself and similarly situated
plaintiffs who had their automobiles repossessed and sought to
recover statutory damages under the UCC.
The second action filed May 29, 2014 contained similar
allegations, which the plaintiff also sought to pursue as a class
action for statutory damages. In response to these actions, the
Bank has contested the allegations that the notices were
deficient, asserted various legal defenses and counterclaims, and
opposed class certification.
On September 30, 2014, the Bank reached an agreement in principle
to settle the first action for $2.8 million in exchange for
release of all claims of the class members covered by these
actions. A litigation settlement charge of $2.8 million with
respect to the settlement of the class actions was recorded in the
third quarter of 2014. In connection with this settlement, on
March 25, 2015, the parties executed a settlement agreement and
the plaintiff's counsel filed a motion with the Court for
preliminary approval. The settlement is subject to the Court's
final approval following notice to the class members, including
the ability of class members to oppose or opt-out of the
settlement.
CYPRESS SEMICONDUCTOR: Settles SRAM Class Actions in Canada
-----------------------------------------------------------
Cypress Semiconductor Corporation has reached a settlement in the
pending class action claims in three Canadian provinces relating
to the original static random access memory ("SRAM") technology
class action case that was resolved in the United States in 2010,
the Company said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 29, 2015.
As with the case in the United States, the Company is confident
that it has not engaged in any antitrust activity, however given
that it was the last remaining defendant and the cost of continued
litigation would far exceed the cost of a nominal settlement, the
Company agreed to settle the case and court approval of that
settlement is in progress.
CYPRESS SEMICONDUCTOR: Inks MOU to Resolve Spansion Merger Case
---------------------------------------------------------------
Spansion Inc. and Cypress Semiconductor Corporation have entered
into a memorandum of understanding with plaintiffs in the class
action complaints related to the Companies' merger, Cypress said
in its Form 10-Q Report filed with the Securities and Exchange
Commission on May 8, 2015, for the quarterly period ended March
29, 2015.
"After our announcement of the merger with Spansion Inc. in
December 2014, two separate putative class action complaints
(Walter Jeter v. Spansion Inc., et. al. (No. 114CV274635) and
Shiva Y. Stein v. Spansion Inc., el. al. (No. 114CV274924)) were
filed in Santa Clara County Superior Court, alleging claims of
breach of fiduciary duty against the Spansion's board of directors
and naming Cypress as a defendant for aiding and abetting the
alleged breach of fiduciary duty," the Company said. While Cypress
believes these lawsuits to be meritless, Spansion and Cypress
entered into a memorandum of understanding with plaintiffs, the
terms of which required additional disclosures by the Company and
payment of attorneys' fees to the class counsel. Final resolution
of these litigations will require court approval of a final
settlement agreement.
DEX MEDIA: To Honor Indemnification Obligations
-----------------------------------------------
Dex Media, Inc. plans to honor its indemnification obligations and
vigorously defend a class action lawsuit on the defendants'
behalf, the Company said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015.
On November 25, 2009, three retirees brought a putative class
action lawsuit in the U.S. District Court for the Northern
District of Texas, Dallas Division, against both the employee
benefits committee and pension plans of Verizon and the employee
benefits committee ("EBC") and pension plans of SuperMedia. All
three named plaintiffs are receiving the single life monthly
annuity pension benefits. All complain that Verizon transferred
them against their will from the Verizon pension plans to
SuperMedia pension plans at or near the SuperMedia's spin-off from
Verizon. The complaint alleges that both the Verizon and
SuperMedia defendants failed to provide requested plan documents,
which would entitle the plaintiffs to statutory penalties under
the Employee Retirement Income Securities Act ("ERISA"); that both
the Verizon and SuperMedia defendants breached their fiduciary
duty for refusal to disclose pension plan information; and other
class action counts aimed solely at the Verizon defendants. The
plaintiffs seek class action status, statutory penalties, damages
and a reversal of the employee transfers. The SuperMedia
defendants filed their motion to dismiss the entire complaint on
March 10, 2010. On October 18, 2010, the court ruled on the
pending motion dismissing all the claims against the SuperMedia
pension plans and all of the claims against SuperMedia's EBC
relating to the production of documents and statutory penalties
for failure to produce same. The only claims that remained against
SuperMedia were procedural ERISA claims against SuperMedia's EBC.
On November 1, 2010, SuperMedia's EBC filed its answer to the
complaint. On November 4, 2010, SuperMedia's EBC filed a motion to
dismiss one of the two remaining procedural ERISA claims against
the EBC. Pursuant to an agreed order, the plaintiffs obtained
class certification against the Verizon defendants. After
obtaining permission from the court, the plaintiffs filed another
amendment to the complaint, alleging a new count against
SuperMedia's EBC. SuperMedia's EBC filed another motion to dismiss
the amended complaint and filed a summary judgment motion before
the deadline set by the scheduling order. On March 26, 2012, the
court denied SuperMedia's EBC's motion to dismiss. On September
16, 2013, the court granted the defendants' summary judgments,
denied the plaintiffs' summary judgment, and entered a take
nothing judgment in favor of the SuperMedia EBC. Plaintiffs filed
an appeal to the U.S. Court of Appeals for the Fifth Circuit. Oral
argument was held on September 4, 2014. On October 14, 2014, the
Court of Appeals affirmed the decision of the trial court.
Plaintiffs filed a petition for a writ of certiorari to the U.S.
Supreme Court on February 17, 2015. The Company plans to honor its
indemnification obligations and vigorously defend the lawsuit on
the defendants' behalf.
DEX MEDIA: SuperMedia Filed Motion to Dismiss
---------------------------------------------
Dex Media, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that SuperMedia filed a
motion to dismiss the amended complaint in a class action lawsuit
filed by a former employee.
On December 10, 2009, a former employee with a history of
litigation against SuperMedia, filed a putative class action
lawsuit in the U.S. District Court for the Northern District of
Texas, Dallas Division, against certain of SuperMedia's current
and former officers, directors and members of SuperMedia's EBC.
The complaint attempts to recover alleged losses to the various
savings plans that were allegedly caused by the breach of
fiduciary duties in violation of ERISA by the defendants in
administrating the plans from November 17, 2006 to March 31, 2009.
The complaint alleges that: (i) the defendants wrongfully allowed
all the plans to invest in Idearc common stock, (ii) the
defendants made material misrepresentations regarding SuperMedia's
financial performance and condition, (iii) the defendants had
divided loyalties, (iv) the defendants mismanaged the plan assets,
and (v) certain defendants breached their duty to monitor and
inform the EBC of required disclosures. The plaintiffs are seeking
unspecified compensatory damages and reimbursement for litigation
expenses. At this time, a class has not been certified. The
plaintiffs filed a consolidated complaint. SuperMedia filed a
motion to dismiss the entire complaint on June 22, 2010. On March
16, 2011, the court granted the SuperMedia defendants' motion to
dismiss the entire complaint; however, the plaintiffs have
repleaded their complaint. SuperMedia's defendants filed another
motion to dismiss the new complaint. On March 15, 2012, the court
granted the SuperMedia defendants' second motion dismissing the
case with prejudice. The plaintiffs appealed the dismissal.
On July 9, 2013, the U.S. Court of Appeals for the Fifth Circuit
issued a decision affirming the dismissal of the trial court. On
July 23, 2013, plaintiffs filed a petition to the Court of Appeals
for a rehearing en banc which was denied. The plaintiffs filed a
petition for a writ of certiorari to the United States Supreme
Court. After the Supreme Court's decision in Fifth Third Bancorp
v. Dudenhoeffer, the court granted plaintiffs' writ, vacated the
Court of Appeals opinion and remanded the case to the Court of
Appeals to rule in conformity with the Fifth Third opinion.
Subsequently, the case was remanded to the trial court. On
February 17, 2015, the plaintiffs filed an amended complaint. On
April 1, 2015, SuperMedia filed a motion to dismiss the amended
complaint. The Company plans to honor its indemnification
obligations and vigorously defend the lawsuit on the defendants'
behalf.
ENOVA INTERNATIONAL: No Ruling Yet on Motion for Summary Judgment
-----------------------------------------------------------------
Enova International, Inc. said in its Form 10-Q Report filed with
the Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the court has not yet
ruled on plaintiff's motion for summary judgment against all of
the defendants in the class action lawsuit filed by Flemming
Kristensen.
On March 8, 2013, Flemming Kristensen, on behalf of himself and
others similarly situated, filed a purported class action lawsuit
in the U.S. District Court of Nevada against the Company and other
unaffiliated lenders and lead providers. The lawsuit alleges that
the lead provider defendants sent unauthorized text messages to
consumers on behalf of the Company and the other lender defendants
in violation of the Telephone Consumer Protection Act. The
complaint seeks class certification, statutory damages, an
injunction against "wireless spam activities," and attorneys' fees
and costs. The Company filed an answer to the complaint denying
all liability.
On March 26, 2014, the Court granted class certification. On
October 24, 2014, the Company filed a motion for summary judgment,
and the court has not yet ruled on this motion. On January 27,
2015, the plaintiff filed a motion for summary judgment against
all of the defendants, and the court has not yet ruled on this
motion.
Neither the likelihood of an unfavorable ruling nor the ultimate
liability, if any, with respect to this matter can be determined
at this time, and the Company is currently unable to estimate a
range of reasonably possible losses for this litigation. The
Company believes that the plaintiff's claims in the complaint are
without merit and intends to vigorously defend this lawsuit.
ENVISION HEALTHCARE: Court Certifies Overtime Claim Class
---------------------------------------------------------
Envision Healthcare Holdings, Inc. said in its Form 10-Q Report
filed with the Securities and Exchange Commission on May 8, 2015,
for the quarterly period ended March 31, 2015, that while a Court
has certified a class on overtime claims, plaintiffs' counsel
stipulated to decertify and dismiss those claims as AMR's policy
complies with a recent Court of Appeals decision.
Four different putative class action lawsuits were filed against
AMR and certain subsidiaries in California alleging violations of
California wage and hour laws. On April 16, 2008, Laura Bartoni
commenced a suit in the Superior Court for the State of
California, County of Alameda; on July 8, 2008, Vaughn Banta filed
suit in the Superior Court of the State of California, County of
Los Angeles; on January 22, 2009, Laura Karapetian filed suit in
the Superior Court of the State of California, County of Los
Angeles; and on March 11, 2010, Melanie Aguilar filed suit in
Superior Court of the State of California, County of Los Angeles.
The Banta, Aguilar and Karapetian cases have been coordinated in
the Superior Court for the State of California, County of Los
Angeles, and the Aguilar and Karapetian cases have subsequently
been consolidated into a single action. In these cases, the
plaintiffs allege principally that the AMR entities failed to pay
wages, including overtime wages, in compliance with California
law, and failed to provide required meal breaks, rest breaks or
pay premium compensation for missed breaks. The plaintiffs are
seeking to certify classes on these claims and are seeking lost
wages, various penalties, and attorneys' fees under California
law.
The Court has certified classes in the consolidated Karapetian/
Aguilar case on claims alleging that AMR has not provided meal
periods in compliance with the law as to dispatchers and call
takers, that AMR has an unlawful time rounding policy, and that
AMR has an unlawful practice of setting rates for those employees;
the Court denied certification of the rest period claims of these
employees.
In the Banta case, the Court denied certification of the meal and
rest period claims as to EMTs and paramedics, a decision that is
being appealed; the Court indicated that it would certify a class
on overtime claims, but plaintiff's counsel has indicated that
they intend to dismiss that claim as AMR's policy complies with a
recent Court of Appeals decision. In the Bartoni case, the Court
denied certification on the meal and rest period claims of all
unionized employees in Northern California, a decision that is
being appealed.
While the Court certified a class on the overtime claims,
plaintiffs' counsel stipulated to decertify and dismiss those
claims as AMR's policy complies with a recent Court of Appeals
decision. The Company is unable at this time to estimate the
amount of potential damages, if any.
FAST RIG: Judge Tosses Motion to Dismiss FLSA Overtime Suit
-----------------------------------------------------------
Gina Passarella, writing for The Legal Intelligencer, reports that
two trucking companies that make deliveries to natural-gas
drilling sites in Pennsylvania cannot escape the Fair Labor
Standards Act's overtime rules because their transport of water
within the state is not so integral to interstate commerce to fall
under any overtime exemptions outlined in the federal Motor
Carrier Act.
U.S. District Judge Malachy E. Mannion of the Middle District of
Pennsylvania rejected defendants Fast Rig Support and First
Americans Shipping and Trucking's motion to dismiss a collective
action filed against them, finding the Motor Carrier Act's
exemptions from the FLSA's overtime provisions do not apply.
The plaintiffs in Mazzarella v. Fast Rig Support are drivers for
the two trucking companies who were responsible for delivering
fracking water to gas-drilling rigs in the state. They alleged
they often worked more than 40 hours a week but were not paid
overtime rates until they hit 45 hours a week. The parties have
agreed that both the FLSA and Pennsylvania Minimum Wage Act claims
would be combined into a collective action. The defendants then
moved to dismiss the claims, saying the Motor Carrier Act gives
the secretary of Transportation authority over interstate
transportation activities that affect safety on public highways.
In order for the Motor Carrier Act's overtime exemptions to apply,
the defendants had the "heavy burden" of proving the fracking
water being hauled was "property" under the act and that the
intrastate trips constituted a "practical continuity of movement
in interstate commerce," Judge Mannion said. He found water was
considered property for purposes of the Motor Carrier Act, but
said there was not enough evidence to show the transport of the
water equated to a practical continuity of interstate commerce.
The Motor Carrier Act is silent as to the definition of
"property," and no court has determined whether fracking water
would be considered property, Judge Mannion said. The trucking
companies argued the water is a key ingredient to the fracking
process while the plaintiffs equated it to non-recyclable debris
given it cannot be reused after going through the fracking
process.
Judge Mannion noted materials that have no value, such as trash,
have been found by another court to not be considered property
under the Motor Carrier Act.
"The court finds that the water at issue has economic value to
defendants because they are being paid to both transport it to the
gas-drilling site and to haul the contaminated wastewater away
from the drilling site," Judge Mannion said.
Judge Mannion said the water is owned by the gas-drilling
companies, which retain the rights to use and transport it as they
see fit. He said the water is accounted for by the gallon and has
to be disposed of in compliance with state and federal
environmental regulations.
"The water is not comparable to garbage as the plaintiff suggests
because the water is usually not contaminated when it is initially
being hauled to the drilling rigs by the employees," Judge Mannion
said.
Judge Mannion then moved to the second factor of interstate
commerce. The trucking companies argued the intrastate
transportation of fracking water directly affects interstate
commerce. Judge Mannion said actual interstate travel doesn't
have to occur for the Motor Carrier Act to apply, but rather the
possibility of it. The defendants had argued that they
occasionally contract with gas-drilling companies to transport
contaminated water from Pennsylvania drill sites to Ohio.
"The fact that the transportation of some goods is part of a
larger journey that will eventually cross state lines does not
necessarily mean that every leg of the journey involves interstate
commerce under the Motor Carrier Act," Judge Mannion said.
The only way the plaintiffs in this case, who only transported
clean water from one Pennsylvania site to another, could fall
under the Motor Carrier Act exemptions is if their trips shared a
practical continuity of movement with the eventual interstate
travel of the water for disposal, Judge Mannion said. The
trucking companies said the water does not come to rest in
Pennsylvania, but rather passes through the state and ends up in
Ohio.
"However, the interstate movement of the water is interrupted by
the fracking process in that the fresh water that is delivered
becomes contaminated before being transported to Ohio for
disposal," Judge Mannion said.
Judge Mannion rejected the defense's interstate commerce argument,
finding its transportation of the water was two separate
commercial transactions. The first was the delivery of untainted
water intrastate and the second was the delivery of tainted water
out-of-state. The final destination of the water as far as the
plaintiff drivers are concerned was within Pennsylvania, Judge
Mannion said.
Finding the Motor Carrier Act did not apply, Judge Mannion ruled
the FLSA and state minimum wage claims could proceed.
Peter Winebrake of Winebrake & Santillo in Dresher represented the
plaintiffs. He said there were about 40 plaintiffs who opted into
the collective action, but he said the ruling will have a broader
impact.
"I think it's an important ruling given the fracking industry in
the state," Mr. Winebrake said. "These water-hauling trucks are
an important part of the industry and the fact that the drivers
aren't covered by the exemption is certainly a significant
development."
William E. Vinsko Jr. of Vinsko & Associates in Wilkes-Barre
represented the trucking companies. He said this was the first
opinion to address whether water was property under the Motor
Carrier Act. The judge's ruling brings down one hurdle for the
trucking companies at trial, Mr. Vinsko said, leaving the defense
to only have to prove to the jury the transport involved
interstate commerce. He said the judge only ruled that there was
not enough evidence before him at that stage to determine there
was interstate commerce, but Mr. Vinsko said it remains a question
of fact for the jury.
FOX SEARCHLIGHT: 2nd Cir. Adopts Intern Pay Standard
----------------------------------------------------
Ben Bedell, writing for Law.com, reports that a legal standard
advocated by employers for determining whether a company has
violated the Fair Labor Standards Act (FLSA) by using unpaid
interns was adopted on July 2 by the U.S. Court of Appeals for the
Second Circuit.
The circuit unanimously rejected the Department of Labor's six-
factor test championed by the plaintiffs in Glatt v. Fox
Searchlight Pictures, 13-4481-cv, saying "the proper question is
whether the intern or the employer is the primary beneficiary of
the relationship."
The case was brought by three aspiring filmmakers who worked in
the Manhattan offices of Fox Searchlight Pictures during the
production of "Black Swan," a 2010 psychological thriller that
went on to gross $329 million worldwide. The film was nominated
for four Academy Awards, and its star, Natalie Portman, won the
Oscar for best actress.
The plaintiffs and Department of Labor argued that a 1947 U.S.
Supreme Court case, Walling v. Portland Terminal Co., 330 U.S.
148, set a framework for distinguishing between unpaid interns and
"employees" covered under the FLSA.
The Portland Terminal decision ruled that a railroad's brakeman
training program did not fall under labor law.
Writing for the panel, Circuit Judge John Walker Jr. said "unlike
the brakemen at issue in Portland Terminal, all of the plaintiffs
were enrolled in or had recently completed a formal course of
post-secondary education."
"By focusing on the educational aspects of the internship our
approach better reflects the role of internships in today's
economy than the DOL factors, which were derived from a 68-year-
old Supreme Court decision that dealt with a single training
course offered to prospective railroad brakemen," Judge Walker
added.
The ruling vacated the June 2013 holding of Southern District
Judge William Pauley III adopting the labor department's factors
(NYLJ, June 14, 2013). Oral arguments were heard Jan. 30 (NYLJ,
Feb. 2, 2015).
The circuit's ruling included a seven-factor "non-exclusive set of
considerations" to determine which party was the primary
beneficiary of the intern relationship.
The list included: the extent to which the intern and employer
clearly understand there is no expectation of compensation or a
job at the end of the internship; the usefulness of the training
to the intern's coursework; whether the internship takes place
during school vacation periods and its duration does not extend
beyond "the learning period," and the extent to which the intern's
work "complements rather than displaces the work of paid
employees."
The definition of an unpaid intern not covered under FSLA has been
hotly litigated in other circuits, but this was the first ruling
on the issue by the Second Circuit.
"The Supreme Court has yet to address the difference between
unpaid interns and paid employees under the FLSA," Judge Walker
noted.
The panel also overruled Judge Pauley's grant of class
certification to the plaintiffs, saying the common issues
requirement had not been met because "the question of an intern's
employment status is a highly individualized inquiry."
Plaintiffs' attorney Rachel Bien, a partner at Outten & Golden,
said "while we're disappointed with the outcome, because we do not
believe it comports with FSLA's very generous 'employee'
definition, the court has nonetheless drawn a clear line that is
good for workers."
"Even if an intern is in school, employers must be able to show
that they are providing training that is closely tied to the
intern's academic work," Ms. Bien said. "Many of the most abusive
internships involving low-level tasks and grunt-type work are
plainly illegal under this standard," he said.
Judge Walker noted that "employers can also exploit unpaid interns
by using their free labor without providing them with an
appreciable benefit in education or experience."
The ruling said lead plaintiff Eric Glatt "worked from
approximately 9 a.m. to 7 p.m. five days a week mostly doing
clerical work and 'running errands,' one of which required him to
purchase a non-allergenic pillow for Director Darren Aronofsky."
Co-plaintiff Alexander Footman "worked 10-hour days" at tasks that
included "bringing tea to Aronofsky," the opinion noted.
Mr. Glatt was a 40-year-old financial analyst with an MBA who
decided to pursue a career in entertainment when the 2008
financial crisis hit, according to a November 2014 Hollywood
Reporter article. Mr. Glatt was expected to graduate from
Georgetown University Law Center this year.
The article said that Mr. Glatt's suit had "ushered in a wave of
lawsuits against" Sony, Warner Bros. and Viacom, which have called
into question decades of tradition in Hollywood's use of interns.
A suit against NBCUniversal was settled in 2014 for $6.4 million
and Viacom settled a suit for $7.2 million in 2015.
Neal Katyal -- neal.katyal@hoganlovells.com -- a partner at Hogan
Lovells, argued for Fox Searchlight in Mr. Glatt.
In a statement, Fox said, "We are very pleased with the court's
ruling, but the real winners are students. Fox has always been
very proud of its internship programs and continues to believe
they offer tremendous benefits to those who participate in them."
The circuit panel, which also included Judges Dennis Jacobs and
Richard Wesley, remanded the case for further proceedings in
conformity with its opinion.
FTD COMPANIES: Class Action Parties Filed Memorandum
----------------------------------------------------
FTD Companies, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the parties and
objector in a class action lawsuit have submitted a memorandum
summarizing the import of the Frank v. Netflix decision and
stating their intentions going forward.
Commencing on August 19, 2009, the first of a series of consumer
class action lawsuits was brought against Provide Commerce, Inc.
and co-defendant Regent Group, Inc. d/b/a Encore Marketing
International ("EMI"). These cases were ultimately consolidated
during the next three years into Case No. 09 CV 2094 in the United
States District Court for the Southern District of California
under the title In re EasySaver Rewards Litigation. Plaintiffs'
claims arise from their online enrollment in subscription based
membership programs known as EasySaver Rewards, RedEnvelope
Rewards, and Preferred Buyers Pass (collectively the "Membership
Programs"). Plaintiffs claim that after they ordered items from
certain of Provide Commerce's websites, they were presented with
an offer to enroll in one of the Membership Programs, each of
which is offered and administered by EMI. Plaintiffs purport to
represent a putative nationwide class of consumers allegedly
damaged by Provide Commerce's purported unauthorized or otherwise
allegedly improper transferring of the putative class members'
billing information to EMI, who then posted allegedly unauthorized
charges to their credit or debit card accounts for membership fees
for the Membership Programs.
On February 22, 2010, Provide Commerce and EMI respectively filed
motions to dismiss. On August 13, 2010, the court entered an order
granting in part and denying in part the motions. Between August
13, 2010 and December 2011, plaintiffs filed various amended
complaints and added or dismissed certain named plaintiffs.
Plaintiffs filed the fourth amended complaint on December 14,
2011.
The fourth amended complaint is the operative complaint.
Plaintiffs assert ten claims against Provide Commerce and EMI in
the fourth amended complaint: (1) breach of contract (against
Provide Commerce only); (2) breach of contract (against EMI only);
(3) breach of implied covenant of good faith and fair dealing; (4)
fraud; (5) violations of the California Consumers Legal Remedies
Act; (6) unjust enrichment; (7) violation of the Electronic Funds
Transfer Act (against EMI only); (8) invasion of privacy; (9)
negligence; and (10) violations of the Unfair Competition Law.
Plaintiffs assert their claims individually and on behalf of a
putative nationwide class. Plaintiffs sought damages, attorneys'
fees, and costs.
Provide Commerce and EMI filed motions to dismiss the claims of
plaintiffs Lawler, Walters, Cox, and Dickey on January 24, 2012.
The motions to dismiss were fully briefed as of February 23, 2012,
but the court had not yet conducted a hearing or ruled on the
motions. The parties participated in numerous settlement
conferences and mediations throughout the case in an effort to
resolve this matter.
On April 9, 2012, the parties reached an agreement on the high
level terms of a settlement, conditioned on the parties
negotiating and executing a complete written agreement. In the
weeks following April 9, 2012, the parties negotiated a formal
written settlement agreement ("Settlement"). Upon reaching the
Settlement, the hearing on the motions to dismiss was vacated, and
Provide Commerce and EMI have not answered the fourth amended
complaint in light of the Settlement. The court granted the
plaintiffs' unopposed motion for preliminary approval of the
Settlement on June 13, 2012.
After notice to the class and briefing by the parties, the court
conducted a final approval hearing (also known as a fairness
hearing) on January 28, 2013, and took the matter under submission
at the conclusion of the hearing. On February 4, 2013, the court
entered its final order approving class action settlement,
granting plaintiffs' motion for attorneys' fees, costs, and
incentive awards, and overruling objections filed by a single
objector to the Settlement. The court entered judgment on the
settlement on February 21, 2013. The objector filed a notice of
appeal with the Ninth Circuit Court of Appeals on March 4, 2013.
After the completion of briefing, the Ninth Circuit set oral
argument on the appeal for February 2, 2015. But on January 29,
2015, the Ninth Circuit entered an order deferring argument and
resolution of the appeal pending the Ninth Circuit's decision in a
matter captioned Frank v. Netflix, No. 12 15705+. The Ninth
Circuit issued its opinion in Frank v. Netflix, No. 12 15705+ on
February 27, 2015, affirming the district court's approval of a
settlement between Walmart and a class of Netflix DVD subscribers.
On March 19, 2015, the Ninth Circuit entered an order vacating the
judgment in this matter and remanding it to the district court for
further proceedings consistent with Frank v. Netflix. The Ninth
Circuit's mandate issued on April 14, 2015, and the matter is now
pending before the district court to consider final approval of
the Settlement in light of Frank v. Netflix.
On April 23, 2015, the district court entered an order reopening
the case and ordering the parties to jointly submit a memorandum
summarizing the import of the Frank v. Netflix decision and
stating their intentions going forward. On May 4, 2015, such
memorandum was filed by the parties and the objector also filed
his own memorandum regarding these same topics on such date. The
issue of whether the Settlement should receive final approval
presently remains pending before the district court.
GENERAL MOTORS: Seeks Dismissal of Fourth Securities Class Action
-----------------------------------------------------------------
Amanda Bronstad, writing for The National Law Journal, reports
that General Motors Co. is banking that a recent ruling in
Delaware could wipe out shareholder lawsuits filed over last
year's ignition-switch recalls.
Vice Chancellor Sam Glasscock of Delaware Court of Chancery on
June 26 dismissed a shareholder derivative action against GM after
concluding the plaintiffs had "failed to raise a reasonable doubt
that GM's directors acted in good faith or otherwise face a
substantial likelihood of personal liability in connection with
the faulty ignition switches."
The ruling gave GM its first victory against a raft of shareholder
cases filed following its recalls of more than 30 million cars and
trucks worldwide, many for a defect that causes the ignition
switch to slip into the accessory position, shutting down
electrical power and disabling air bags. The defect spawned
hundreds of lawsuits, including the shareholder claims, which have
been consolidated into four separate cases.
In addition to the proceeding in Delaware, two derivative lawsuits
are pending in state and federal courts in Michigan; GM has moved
to dismiss a fourth case, a securities class action, with its next
brief due on July 3.
"The Delaware court properly dismissed the complaint because GM's
board of directors did its job in exercising oversight over the
company," GM spokesman James Cain wrote in an email to the NLJ.
"The other shareholder derivative actions pending against the
board make the same allegations, so we hope the courts will
dismiss those as well."
As for the securities class action, he wrote: "The claims asserted
in the cases are different, but the shareholder suit suffers from
the same failure to allege particularized facts sufficient to
support a case."
All the shareholder cases seek to refute a GM internal report that
blamed its failure to identify the defect on negligence by a few
company engineers and lawyers, many of whom have been fired, and
concluded that the board and top executives were kept in the dark.
The derivative cases in the U.S. District Court for the Eastern
District of Michigan and the Michigan Third Judicial Circuit in
Wayne County, had been stayed pending the Delaware decision.
Plaintiffs lawyers in both cases -- Dave Honigman --
dhonigman@manteselaw.com -- a partner at Mantese Honigman in Troy,
Michigan, and Susan Winters of Leikin Ingber & Winters in
Southfield, Michigan -- did not respond to requests or calls for
comment.
But the securities class action is going forward on behalf of
hundreds of thousands of GM shareholders who allegedly lost
billions of dollars following the recalls.
In a 574-page complaint that cites 38 written and oral statements,
the plaintiffs allege that GM's executives failed to warn
shareholders of the costs and liabilities associated with the
recalls, including a victim compensation fund and defending
against hundreds of lawsuits.
"Rather, at every turn, GM sought to cover up and hide from
investors the true costs and risks arising from the ignition-
switch defects," wrote Salvatore Graziano -- sgraziano@blbglaw.com
-- a partner at New York's Bernstein Litowitz Berger & Grossmann.
Mr. Graziano declined to comment.
In addition to GM, the case names chief executive officer Mary
Barra, former chief executive officer Daniel Akerson, GM president
Daniel Ammann and five additional senior officers. The proposed
class is on behalf of shareholders who bought GM stock between
Nov. 17, 2010, and July 24, 2014.
GM filed a motion to dismiss the case on March 13.
GLAXOSMITHKLINE: Girard Keese Must Pay Avandia MDL Committee
------------------------------------------------------------
P.J. D'Annunzio, writing for The Legal Intelligencer, reports that
a firm that used work product from a plaintiffs' steering
committee in the Avandia multidistrict litigation must pay a
percentage of the settlement proceeds from its cases to the
committee's attorney compensation fund.
The U.S. Court of Appeals for the Third Circuit affirmed a ruling
from the district judge presiding over the MDL that the Girardi
Keese firm of Los Angeles -- which represented thousands of
plaintiffs in Avandia cases in California state court and 25 in
the Eastern District of Pennsylvania-based MDL -- could not get
out of paying into the committee's "common benefit fund."
Third Circuit Judge D. Michael Fisher said in the panel's opinion
that the Avandia steering committee created the fund to compensate
attorneys for administration and work product in the MDL. By
signing a contract to participate within the steering committee,
Girardi Keese agreed to pay 7 percent of the gross recovery gained
from its cases to the fund, a payment that the firm later refused
after settling all of its cases.
When the district judge ordered Avandia's manufacturer,
GlaxoSmithKline, to withhold 7 percent of the settlement proceeds
for the common benefit fund, Girardi Keese appealed, challenging
the court's jurisdiction.
The total amount of settlement money from the Girardi Keese cases
was not clear. Thomas Girardi of Girardi Keese did not return a
call seeking comment.
Judge Fisher said the agreements between attorneys and the
steering committee were properly enforced by a court order.
"A district court that supervises a multidistrict litigation
'has -- and is expected to exercise -- the ability to craft a
plaintiffs' leadership organization to assist with case
management,'" Judge Fisher said. "Included in that ability 'is
the power to fashion some way of compensating the attorneys who
provide classwide services.' Here, the district court issued an
order -- Pretrial Order 70 -- dictating how it would allow the
leadership organization -- the steering committee -- to be
compensated. One way was to assess a percentage of the recovery
of the cases before the MDL. The district court also permitted
the steering committee to, essentially, trade work product for a
share in the recovery in cases not before the MDL. The district
court identified a form agreement that the steering committee and
interested counsel must use to participate in the common benefit
scheme and 'incorporated' the agreement into the order."
Avandia is a prescription drug used to treat Type 2 diabetes.
Thousands of the drug's users sued GSK claiming that it increased
the risk of heart failure. The court appointed a steering
committee in the MDL to direct the proceedings, Judge Fisher said.
The agreement between the committee and Girardi Keese, in addition
to providing work product such as expert reports to be used in
Avandia state and federal cases, authorized Girardi Keese to
request compensation for work performed for the common benefit.
The court's Pretrial Order 70 echoed that.
After Girardi Keese's settlements, a dispute arose over the firm's
refusal to pay the 7 percent fee and the court's subsequent order.
Girardi Keese argued that by ordering the firm to adhere to the
agreement, the district court improperly exercised jurisdiction
over the state-court cases in California -- cases outside of the
MDL judge's jurisdiction, Judge Fisher said.
"We agree with Girardi Keese that had the district court simply
ordered the firm, as total strangers to the litigation, to
contribute to the common benefit fund from the settlement of its
clients' state-court cases, it would have exceeded its
jurisdiction," Judge Fisher said. "However, that is not what the
district court did here. The proper question we must ask is did
the district court properly exercise jurisdiction to enforce the
contract Girardi Keese made with the plaintiffs' steering
committee. We conclude that it did."
Girardi Keese also argued that it should have received
compensation for the work it did for the common benefit.
"Although Girardi Keese says it spent $14 million litigating its
cases, it did not offer evidence that its efforts were for the
common benefit as opposed to solely on behalf of its clients. We
cannot say the district court abused its discretion in failing to
consider or grant a credit for the common benefit Girardi Keese
provided when no evidence exists in the record that Girardi Keese
actually provided a common benefit," Judge Fisher said.
Dianne Nast of NastLaw, a member of the steering committee, did
not return a call seeking comment.
HEALTHWAYS INC: To Defend Against Edward Simon Action
-----------------------------------------------------
Healthways, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the Company intends to
vigorously defend the action filed by Edward Simon, DC.
On September 16, 2014, Healthways and its wholly owned subsidiary,
Healthways WholeHealth Networks, Inc. ("HWHN"), were named in a
putative class action lawsuit filed by Edward Simon, DC in the
Superior Court of California, County of Los Angeles, seeking
damages and other relief relating to alleged violations of the
Telephone Consumer Protection Act ("TCPA"), as amended by the Junk
Fax Prevention Act ("JFPA"), in connection with faxes allegedly
transmitted to members of HWHN's network of complementary and
alternative care practitioners. The JFPA prohibits sending an
"unsolicited advertisement" to a fax machine and requires the
sender to provide a notice to allow a recipient to "opt out" of
future fax transmissions (including, pursuant to rules promulgated
by the Federal Communications Commission ("FCC"), those sent with
the prior express invitation or permission of the recipient). The
complaint seeks damages in excess of $5 million. The case has been
removed to the United States District Court for the Central
District of California, Eastern Division ("California Matter").
HEALTHWAYS INC: To Defend Against Affiliated Health Action
----------------------------------------------------------
Healthways, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the Company intends to
vigorously defend the action filed by Affiliated Health Care
Associates, P.C.
On December 22, 2014, Healthways WholeHealth Networks, Inc.
("HWHN"), was named in a putative class action lawsuit filed by
Affiliated Health Care Associates, P.C. in the United States
District Court for the Northern District of Illinois, Eastern
Division ("Illinois Matter"), seeking damages and other relief
relating to alleged violations of the TCPA, the Illinois Consumer
Fraud and Deceptive Business Practices Act, and Illinois common
law in connection with faxes allegedly sent to members of HWHN's
network of complementary and alternative care practitioners. The
complaint seeks damages in an unstated amount.
"We deny the claims and intend to vigorously defend these
actions," the Company said.
HEMISPHERX BIOPHARMA: July 22 Settlement Fairness Hearing Set
-------------------------------------------------------------
UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF PENNSYLVANIA
Frater v. Hemispherx Biopharma, Inc., et al.
No. 2:12-CV-07152 WY
SUMMARY NOTICE OF PENDENCY OF CLASS ACTION AND PROPOSED
SETTLEMENT, SETTLEMENT FAIRNESS HEARING, AND MOTION FOR AWARD
OF ATTORNEYS' FEES AND REIMBURSEMENT OF LITIGATION EXPENSES
TO: All persons and entities who purchased or otherwise acquired
Hemispherx Biopharma, Inc. common stock trading under ticker
symbol HEB from March 14, 2012 through and including December 20,
2012, both dates inclusive.
EXCLUDED FROM THE CLASS ARE DEFENDANTS, THE OFFICERS AND DIRECTORS
OF HEMISPHERX, AND THEIR FAMILIES AND AFFILIATES.
YOU ARE HEREBY NOTIFIED, pursuant to Rule 23 of the Federal Rules
of Civil Procedure and an Order of the United States District
Court for the Eastern District of Pennsylvania, that a hearing
will be held on July 22, 2015 at 9:30 a.m., before the Honorable
William H. Yohn Jr. United States District Judge, at the
courthouse for the United States District Court for the Eastern
District of Pennsylvania, 601 Market Street, Philadelphia, PA
19106, to determine, among other things, whether: (1) a Settlement
Class should be certified for purposes of the Settlement and
whether Lead Plaintiff and its counsel have adequately represented
the Class Members; (2) the proposed Settlement of the Class's
claims against the Defendants for $2,750,000.00 should be approved
as fair, reasonable and adequate; (3) the proposed Plan of
Allocation is fair, just, reasonable, and adequate; (4) the Court
should permanently enjoin the assertion of any claims that arise
from or relate to the subject matter of the above-captioned class
action; (5) the Action should be dismissed with prejudice against
the Defendants as set forth in the Stipulation of Settlement filed
with the Court; (6) the application by Lead Counsel for an award
of attorneys' fees and expenses should be approved; and (7) an
application for reimbursement of reasonable costs and expenses of
Lead Plaintiff Member Marc Verheyen should be granted.
If you purchased or otherwise acquired Hemispherx common stock
trading under ticker symbol HEB during the Class Period, your
rights may be affected by this Action and the Settlement thereof.
If you have not received the detailed Notice of Pendency of Class
Action and Proposed Settlement, Settlement Fairness Hearing, and
Motion for Award of Attorneys' Fees and Reimbursement of
Litigation Expenses and Proof of Claim and Release Form, you may
obtain them free of charge by contacting the Claims Administrator,
by mail at: Hemispherx Securities Settlement Administrator, PO Box
30172 College Station, TX 77842-3172; by telephone at
866-374-7219; by e-mail at Info@HemispherxSettlement.com or by
visiting the website at: www.HemispherxSettlement.com
If you are a member of the Class and wish to share in the
Settlement money, you must submit a Proof of Claim no later than
August 21, 2015 establishing that you are entitled to recovery.
As further described in the Notice, you will be bound by any
judgment entered in the Action, regardless of whether you submit a
Proof of Claim, unless you exclude yourself from the Class, in
accordance with the procedures set forth in the Notice, by no
later than July 8, 2015. Any objections to the Settlement, Plan
of Allocation or attorney's fees and expenses must be filed, in
accordance with the procedures set forth in the Notice, no later
than July 8, 2015.
Inquiries, other than requests for the Notice, may be made to Lead
Counsel for the Class: Joshua B. Silverman, Pomerantz LLP, 10
South La Salle Street, Ste. 3505, Chicago, IL 60603, Telephone:
312-377-1181
INQUIRIES SHOULD NOT BE DIRECTED TO THE COURT, THE
CLERK'S OFFICE, THE DEFENDANTS, OR DEFENDANTS' COUNSEL
DATED: May 7, 2015
BY ORDER OF THE UNITED STATES
DISTRICT COURT FOR THE EASTERN
DISTRICT OF PENNSYLVANIA
With offices in New York, Chicago, Florida, and Los Angeles, The
Pomerantz Firm -- http://www.pomerantzlaw.com-- concentrates its
practice in the areas of corporate, securities, and antitrust
class litigation. Founded by the late Abraham L. Pomerantz, known
as the dean of the class action bar, the Pomerantz Firm pioneered
the field of securities class actions.
HOME DEPOT: Delivery Derivers File Overtime Class Action
--------------------------------------------------------
David Gialanella, writing for New Jersey Law Journal, reports that
a putative class action filed in New Jersey federal court claims
The Home Depot Inc. avoided paying overtime by giving compensatory
time off to delivery drivers after weeks in which they exceeded 40
hours -- a practice that contravenes federal and state law,
according to the suit.
The suit, filed July 2 in the U.S, District Court of the District
of New Jersey, claims Home Depot's "conduct in failing to pay
[drivers] properly was and is willful and was not based upon any
reasonable interpretation of the law."
The named plaintiff, Angel Rivera, was employed at the Home Depot
on Main Street in Forked River from July 2010 through November
2014, and was a nonexempt hourly employee, according to the
complaint. He and other drivers "regularly worked/work in excess
of 40 hours per week," the suit claims.
But "instead of paying named plaintiff and plaintiffs one and one
half times his or her regular rate for each hour worked in excess
of 40 hours per workweek, defendant forced named plaintiff and
plaintiffs to accept compensatory time off the week following any
workweek in which [they] worked overtime," the suit claims.
"For instance, if named plaintiff or plaintiffs had worked 42
hours . . . then the following week . . . [they] would be allowed
to work two fewer hours and receive straight time compensation for
them to 'make up' for the two hours over 40," it adds.
Ms. Rivera is seeking certification of a class of current and
former Home Depot delivery drivers, or those "in similar positions
with similar duties," who received compensatory time in lieu of
overtime at any point during the three years preceding the
complaint.
Ms. Rivera does not know the exact size of the class but believes
it consists of at least 40 employees, according to the complaint,
which claims other potential class members are "readily
identifiable" by Home Depot.
In addition to a claim under the federal Fair Labor Standards Act
(FLSA), the suit asserts claims of failure to pay overtime
compensation and failure to pay wages earned in violation of the
New Jersey Wage and Hour Laws.
"Under the FLSA, an employer must pay an employee at least one and
one half times his or her base rate for each hour worked in excess
of 40 hours per workweek," according to the lawsuit, which seeks
injunctive relief, declaratory relief, compensatory damages,
liquidated damages and attorney fees and costs.
The matter is assigned to U.S. District Judge Michael Shipp and
U.S. Magistrate Judge Tonianne Bongiovanni in the Trenton
vicinage.
Daniel Horowitz of Swartz Swidler in Cherry Hill, Garcia's
counsel, said he's not sure how prevalent the alleged practice is.
"Frankly I haven't seen a ton of it," but employees might "know
better" because the practice is illegal, he said.
Mr. Horowitz said it's not clear whether the alleged practice was
limited to the Forked River store.
"It's certainly something we need to get to the bottom of," he
said.
Home Depot has yet to review the complaint, according to spokesman
Stephen Holmes, who declined to comment further.
IOWA SELECT: Wants Judge to Block Sale of Dietary Supplements
-------------------------------------------------------------
The Associated Press reports that an Iowa company has been selling
potentially unsafe dietary supplements and falsely advertising
them as treatments for diseases ranging from colds to cancer, the
federal government alleged on July 10.
Iowa Select Herbs manufactures its dietary supplements in
conditions that cannot ensure safety and promotes them as medical
cures even though they have never been found safe and effective
for such purposes, the U.S. Department of Justice alleged in a
civil complaint.
The enforcement action asks a judge to block the Cedar Rapids-
based company from introducing adulterated and misbranded drugs
into interstate commerce.
Iowa Select Herbs makes nearly 200 supplements that it sells to
consumers and wholesalers across the U.S., mainly through its
website and others such as eBay and Amazon. It also has a retail
store at its headquarters in Cedar Rapids. Most of its
supplements are extracts from plants -- such as papaya leaf,
elderberry and echinacea -- and are sold under names such as Cold
BeGone and Holy Basil Extract.
Co-owner Lois Dotterweich declined to comment on the Justice
Department's allegations. She referred questions to her husband,
co-owner Gordon Freeman, who wasn't immediately available. Both
are named as defendants along with the company.
The company advertises their products as curing or treating
diseases such as cancer, malaria, heart disease, migraines and
herpes. But the U.S. Food and Drug Administration says they
haven't been submitted for testing by experts to evaluate whether
they are effective and therefore cannot be promoted that way.
FDA inspections at the company in 2013 and 2014 also revealed a
number of safety violations and resulted in the company receiving
warnings. Company officials repeatedly failed to test the
products' ingredients to verify their identities, didn't have
specifications for their products and didn't have any quality
control procedures, among other things, according to the
complaint.
The company promised improvements in April 2014, but hasn't
responded to the most recent FDA findings, the complaint alleged.
Instead, Iowa Select Herbs has continued to make disease-treatment
claims, demonstrating an "unwillingness to comply" with federal
law, the complaint said.
JANSSEN PHARMACEUTICA: Court Cuts Penalty in Drug Marketing Case
----------------------------------------------------------------
Meg Kinnard, writing for The Associated Press, reports that South
Carolina's highest court on July 8 further reduced the penalty
against a Johnson & Johnson subsidiary accused of deceptive
marketing of an anti-psychotic drug.
In its ruling, the state Supreme Court ordered Janssen
Pharmaceutica, Inc., to pay about $124 million -- more than $200
million less than the original penalty amount.
In 2011, a trial court ordered the drug maker to pay $327 million,
saying Janssen broke the law by downplaying to doctors the links
between diabetes and Risperdal and by improperly claiming the drug
was safer than competing medications like Eli Lilly & Co.'s
Zyprexa.
Circuit Judge Roger Couch assessed a $300 penalty per sample box
of the drug that was distributed. He also assessed a $4,000
penalty per publication of the "Dear Doctor" letter, writing that
Janssen knew Risperdal was associated with health problems but
intentionally hid studies to that effect, instead telling doctors
their drug led to lower incidence of diabetes and weight gain than
a competing medicine.
That total penalty was the largest drug marketing award in state
history and the largest penalty levied for violations of the South
Carolina Unfair Trade Practices Act.
Company attorneys argued the award should be overturned, saying
Janssen meant no harm and hurt no one. In February, the high
court more than halved the penalties, saying Janssen should only
pay South Carolina $136 million because of South Carolina's three-
year statute of limitations on such cases.
In the July 8 opinion, justices reduced civil penalties on the
labeling claim by $12 million, saying that a recalculation of its
original assessment was necessary.
Risperdal was introduced in 1994 as a "second-generation" anti-
psychotic drug, and it earned Johnson & Johnson billions of
dollars in sales before generic versions became available. The
drug is used to treat schizophrenia, bipolar disorder and
irritability in autism patients.
Janssen spokeswoman Robyn Frenze said the company was happy with
the reduction but still feels the decision should be reversed
completely.
"As we have maintained from the outset of this case, we believe
that we did not violate South Carolina's Unfair Trade Practices
Act, and are reviewing all of our legal options going forward,"
she said.
Spokesman Mark Powell said state Attorney General Alan Wilson was
pleased the court had "once again upheld the rule of law with this
legally sound decision."
Risperdal has been the subject of litigation throughout the
country. In 2013, Janssen announced a $181 million settlement
with 36 states and the District of Columbia. Janssen admitted no
wrongdoing, and South Carolina was not part of that deal.
Last year, the Arkansas Supreme Court declined to reconsider its
decision that threw out a $1.2 billion judgment against the
company over allegations it violated the state's unfair trade
practices act in improperly marketing Risperdal. A year ago, the
Louisiana Supreme Court overturned a $330 million verdict against
Janssen.
Janssen agreed to pay $5.9 million to settle a lawsuit with
Montana. Two similar cases in Pennsylvania and West Virginia were
eventually dismissed.
JIMMY JOHN'S: Assistant Managers File Overtime Class Actions
------------------------------------------------------------
Jonathan Bilyk, writing for Cook County Record, reports that
Jimmy John's, a popular Illinois-based chain of sandwich shops,
now faces multiple class action lawsuits over its treatment of
assistant managers at its hundreds of restaurants across the
country.
And each of those class actions will be litigated in Chicago's
federal court.
This month, lawyers representing a group of assistant store
managers asked U.S. District Judge Elaine E. Bucklo to certify a
class of plaintiffs potentially including all people who have
worked as assistant store managers in Jimmy John's restaurants
since 2012.
The federal action was transferred into the Northern Illinois U.S.
District Court earlier in July, after U.S. District Judge Gregory
L. Frost ordered the case transferred to Chicago from Ohio's
Southern District court in Columbus.
That action had first been filed by plaintiff Scott Watson, who
identified himself in the complaint as an assistant manager who
had worked at three Ohio Jimmy John's stores since 2012, and had
earned $26,000 per year.
Watson was represented in the action by attorneys with the firm of
Landskroner Grieco Merriman LLC, of Cleveland.
During that time, Mr. Watson alleged, he, like all other Jimmy
John's assistant managers, were classified by their employer as
management employees exempt from the overtime and other wage
requirements under the federal Fair Labor Standards Act.
Mr. Watson contended this classification was improper, as he said
assistant managers at Jimmy John's rarely, if ever, actually
manage anyone or anything. Rather, he estimated at least 90
percent of assistant managers' duties are little different from
those of hourly, so-called non-exempt restaurant employees, who
qualify for overtime.
Mr. Watson sued on behalf of himself and -- at the time -- all
other Jimmy John's assistant managers in Ohio, asking the court to
require Jimmy John's to pay the overtime wages the complaint
alleges were illegally withheld, as well as other damages.
At the same time, a similar case brought by other Jimmy John's
assistant managers was pending in federal court in Florida.
According to court documents, those plaintiffs opted to drop their
complaint, and signed on as fellow plaintiffs in Watson's action
in Ohio.
The plaintiffs also asked the court to expand the class to include
assistant managers nationwide.
In response, Jimmy John's asked the court to either dismiss
Watson's action or transfer the case to federal court in Chicago.
In July 2014, Jimmy John's was hit with a class action in that
court from plaintiff Emily Brunner, identified as a second
assistant store manager, a position which ostensibly reports to
assistant store managers.
Like Watson and his assistant store managers, Brunner alleged the
sandwich chain had improperly classified second assistant managers
as managerial positions exempt from the FLSA overtime wage
requirements.
As that case was still pending in the Chicago court, Judge Frost
said, under the so-called "first to file rule," the Watson case
should also be heard in Chicago, as the cases are very similar, as
both the job titles and duties of the plaintiffs, and their
claims, "substantially overlap."
Frost noted the class designation requested by the plaintiffs in
the Watson case would likely have included Brunner and her fellow
second assistant managers, as well. "Despite the claims that
differ between the two suits, the core claim is the same -- an
unpaid overtime FLSA action brought individually by plaintiffs and
on behalf of a nationwide class," Frost wrote.
Following transfer, the Watson plaintiffs have renewed their
request to certify a nationwide class of assistant managers,
asking Judge Bucklo in documents filed July 15 to require
Jimmy John's to supply the attorneys with the names and contact
information of potential class members so the attorneys can notify
them directly by mail and to require the restaurant chain to
include notices of the pending class action with the assistant
managers' regular pay.
The plaintiffs are represented in the action by the Landskroner
firm, as well as attorneys from the firms of Outten & Golden, of
New York; Werman Salas P.C., of Chicago; Shavitz Law Group, of
Boca Raton, Fla.; and Klafter Olsen & Lesser, of Rye Brook, N.Y.
JP MORGAN: $388 Mil. Recovered in MBS Securities Class Action
-------------------------------------------------------------
Robbins Geller Rudman & Dowd LLP on July 17 announced a $388
million recovery on behalf of a class of investors in nine 2007
residential mortgage-backed securities (MBS) offerings issued by
J.P. Morgan -- bringing to a successful conclusion one of the last
remaining MBS purchaser class actions arising out of the global
financial crisis. The settlement represents, on a percentage
basis, the largest recovery ever achieved in an MBS purchaser
class action.
"We're pleased with the record-setting recovery for our
participants and the class," stated Ed Smith, Fund Manager for
lead plaintiff Laborers Pension Trust Fund for Northern
California. "Our lawyers at Robbins Geller were tireless in their
efforts, and the result is a significant victory for the class."
Lead plaintiffs and court-appointed class representatives Laborers
Pension Trust Fund for Northern California and Construction
Laborers Pension Trust for Southern California played a key role
in achieving the remarkable result, said Robbins Geller partner
Luke Brooks -- LukeB@rgrdlaw.com -- one of the lead attorneys on
the case. "We couldn't have achieved such a stellar recovery
without the leadership of the Northern and Southern California
Laborers Pension Funds."
Mr. Brooks said, "These Funds not only stepped forward to protect
their participants' hard earned retirement savings, but equally
important they committed themselves to the trial of this action,
which allowed us to maximize the recovery for the class."
The settlement was achieved after six years of hard-fought
litigation and an extensive investigation into all facets of
defendants' securitization practices -- a process that resulted in
the production of more than 80 million pages of documents from
defendants and third-parties, over 40 witness depositions, and
consultation with experts in diverse and complex fields such as
mortgage re-underwriting, securitization due diligence,
statistics, and economics. Robbins Geller also secured the
cooperation of a critical whistleblower witness, which yielded key
evidence in support of plaintiffs' claims, and obtained a class
certification order that certified the most broadly-defined
plaintiff class of any MBS class action to date.
The $388 million recovery stands alone as the highest percentage-
of-face-value recovered in any of the 16 comparable MBS purchaser
class action settlements obtained to date and is more than two-
and-a-half times greater than the average percentage recovery in
previous MBS purchaser class action settlements. "Ultimately, the
skill of our litigation team and our willingness to take the case
deep paid off with an extraordinary result for the class," said
Mr. Brooks.
The case is Fort Worth Employees' Retirement Fund v. JPMorgan
Chase & Co. (U.S. District Court, Southern District of New York,
No. 09-03701), currently pending before U.S. District Judge J.
Paul Oetken in Manhattan. For more information about the history
of Fort Worth Employees' Retirement Fund v. JPMorgan Chase & Co.
please contact Luke Brooks at Lukeb@rgrdlaw.com or Darryl Alvarado
at Dalvarado@rgrdlaw.com
About Robbins Geller Rudman & Dowd
With 200 lawyers in ten offices, Robbins Geller --
http://www.rgrdlaw.com-- represents U.S. and international
institutional investors in contingency-based securities and
corporate litigation.
LENOVO GROUP: Firms Argue Over Lead Counsel Slots in Adware MDL
---------------------------------------------------------------
Ross Todd, writing for The Recorder, reports that plaintiffs
lawyers handling privacy cases might work on cutting-edge legal
issues, but that doesn't prevent them from breaking into old-
fashioned lead counsel fights.
Four groups of plaintiffs firms were set to convene in U.S.
District Judge Ronald Whyte's San Jose courtroom on July 17 to vie
for the lead counsel spot in privacy litigation against laptop
maker Lenovo Group Ltd. and adware company Superfish Inc. In
their briefs, the plaintiffs groups have taken aim at each others'
motives, tactics and qualifications almost as aggressively as
they've targeted the defendants.
The underlying litigation accuses Lenovo of installing Superfish
adware on its notebook computers that allegedly tracked users'
Internet activity and made their computers vulnerable to
cyberattacks. More than two dozen lawsuits have been filed
against the companies since Lenovo's insertion of the Superfish
program onto its laptops became public in February. In June, the
Judicial Panel on Multidistrict Litigation transferred the cases
to Whyte for pretrial proceedings in In re Lenovo Adware
Litigation, 15-2624, despite calls from some plaintiffs to route
the cases to the Eastern District of North Carolina, the home of
Lenovo's U.S. headquarters.
Three plaintiffs groups have emerged as top contenders for the
coveted lead counsel spot in the MDL. Privacy specialists at the
Edelson law firm have paired with class action firm Robbins Geller
Rudman & Dowd in one of the most formidable groups, and the one
most willing to criticize others in the back-and-forth motions
leading up to the July 17 hearing. They're facing a competing bid
from a trio of Bay Area firms: Cotchett, Pitre & McCarthy, Girard
Gibbs and Pritzker Levine. The Bay Area group touts the backing
of the vast majority of other MDL plaintiffs.
A third group from Block & Leviton and Van Laningham Duncan claims
that their work on a preliminary-injunction motion benefited all
potential class members, and that they're the only group with
lawyers in North Carolina and the Bay Area, where Superfish is
headquartered. Joseph Saveri of the Joseph Saveri Law Firm has
also made a bid to be appointed interim class counsel.
Things could get uncomfortable in Judge Whyte's courtroom on July
17 if the hearing is as contentious as the briefing that's led up
to it.
In one filing, Robbins Geller's Patrick Coughlin and Edelson's Jay
Edelson labeled the Bay Area firms' campaign to garner support
from other plaintiffs a "popularity contest" unworthy of
consideration from the judge. Messrs. Coughlin and Edelson also
claim the complaint filed by the Cotchett firm lifted nine
paragraphs word-for-word from the initial suit filed by Edelson.
"Leaders draft, followers copy," they wrote. They further accuse
the Bay Area firms of going behind their backs to complain to the
defendants about arranging "secret" mediation session after
initially collaborating on a pre-MDL effort to streamline the
case.
In reply, the Bay Area firms accuse Robbins Geller and Edelson of
engaging in pre-MDL settlement talks without the benefit of
discovery and against the better judgment of other plaintiffs.
"This is hardly a record demonstrating the ability to work
cooperatively with other plaintiffs' counsel," wrote
Jonathan Levine -- jkl@pritzkerlevine.com -- of Pritzker Levine.
("Ability to work cooperatively with others" was one of six
criteria Whyte laid out for lead counsel candidates in June in an
initial case management order.)
Despite often taking aim at one another, the Bay Area firms and
the Edelson/Robbins Geller group were united in criticizing the
preliminary injunction efforts of Block & Leviton and Van
Laningham Duncan. The motion for a preliminary injunction to
force Lenovo to give notice to customers about the risks
associated with the Superfish adware and instructions on how to
remove it was briefed in U.S. District Court for the Eastern
District of North Carolina. The case was transferred before a
ruling on the injunction.
Mr. Levine wrote that the injunction bid was "a 'go-it-alone'
strategy that has found no support from any other plaintiffs firm
in the litigation." Mr. Edelson and Geller wrote that the lack of
communication with other plaintiffs about the injunction bid
demonstrated either an inability to cooperate or a desire to show
some procedural advancement in hopes of bolstering the firms'
leadership bid. Even Lenovo's counsel, Daniel Stephenson at K&L
Gates, said that the preliminary-injunction motion had been
ineffective, though the company expressed no preference in the
lead counsel fight. "Lenovo believes that the PI motion
accomplished nothing," Stephenson wrote.
In response, Block & Leviton's Lesley Weaver --
lesley@blockesq.com -- claimed that the preliminary-injunction
effort had elicited potentially damaging statements from the
company. "None of the competing movants have been able to
identify a single concrete step that they have taken to address
the ongoing harm that all movants have alleged in their
complaints," she wrote. Mr. Weaver also warned that "perceived
attacks" on the qualifications of other firms by plaintiffs could
potentially be fodder for the defendants to challenge the adequacy
of any proposed class as the case progresses.
Reached by phone on July 15, Ms. Weaver said the feuding amounts
to "a bunch of talented lawyers interested in leading an important
case."
"We're focused on representing the rights of consumers," she said,
declining to comment further.
Messrs. Edelson and Levine both declined to comment. Mr. Saveri
didn't respond to phone and email messages.
The hearing was set for 9:00 a.m. on July 17 in San Jose.
LEVEL 3: Settlement of Rights-of-Way Case Presented to Court
------------------------------------------------------------
Level 3 Communications, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that settlement of
Rights-of-Way Litigation has been presented to federal courts in
additional states and approval is pending.
The Company is party to a number of purported class action
lawsuits involving its right to install fiber optic cable network
in railroad right-of-ways adjacent to plaintiffs' land. In
general, the Company obtained the rights to construct its networks
from railroads, utilities, and others, and has installed its
networks along the rights-of-way so granted. Plaintiffs in the
purported class actions assert that they are the owners of lands
over which the fiber optic cable networks pass, and that the
railroads, utilities and others who granted the Company the right
to construct and maintain its network did not have the legal
authority to do so. The complaints seek damages on theories of
trespass, unjust enrichment and slander of title and property, as
well as punitive damages. The Company has also received, and may
in the future receive, claims and demands related to rights-of-way
issues similar to the issues in these cases that may be based on
similar or different legal theories.
The Company has defeated motions for class certification in a
number of these actions but expects that, absent settlement of
these actions, plaintiffs in the pending lawsuits will continue to
seek certification of statewide or multi-state classes. The only
lawsuit in which a class was certified against the Company, absent
an agreed upon settlement, occurred in Koyle, et. al. v. Level 3
Communications, Inc., et. al., a purported two state class action
filed in the United States District Court for the District of
Idaho. The Koyle lawsuit has been dismissed pursuant to a
settlement reached in November 2010.
The Company negotiated a series of class settlements affecting all
persons who own or owned land next to or near railroad rights of
way in which it has installed its fiber optic cable networks. The
United States District Court for the District of Massachusetts in
Kingsborough v. Sprint Communications Co. L.P. granted preliminary
approval of the proposed settlement; however, on September 10,
2009, the court denied a motion for final approval of the
settlement on the basis that the court lacked subject matter
jurisdiction and dismissed the case.
In November 2010, the Company negotiated revised settlement terms
for a series of state class settlements affecting all persons who
own or owned land next to or near railroad rights of way in which
the Company has installed its fiber optic cable networks. The
Company is currently pursuing presentment of the settlement in
applicable jurisdictions. The settlements, affecting current and
former landowners, have received final federal court approval in
multiple states and the parties are engaged in the claims process
for those states, including payments of claims. The settlement has
also been presented to federal courts in additional states and
approval is pending.
LEVEL 3: Defending Severance and Contractor Termination Disputes
----------------------------------------------------------------
Level 3 Communications, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that a number of former
employees and third-party contractors have asserted a variety of
claims in litigation against certain Latin American subsidiaries
of the Company for separation pay, severance, commissions, pension
benefits, unpaid vacation pay, breach of employment contracts,
unpaid performance bonuses, property damages, moral damages and
related statutory penalties, fines, costs and expenses (including
accrued interest, attorneys fees and statutorily mandated
inflation adjustments) as a result of their separation from the
Company or termination of service relationships. The Company is
vigorously defending itself against the asserted claims, which
aggregate to approximately $44 million at March 31, 2015.
LIBERTY MEDIA: SIRIUS XM Defendant in Class Action Suits
--------------------------------------------------------
Liberty Media Corporation said in its Form 10-Q Report filed with
the Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that SIRIUS XM is a
defendant in several purported class action suits, which were
commenced in February 2012, January 2013, January 2015 and April
2015, in the United States District Court for the Eastern District
of Virginia, Newport News Division, the United States District
Court for the Southern District of California and the United
States District Court for the Northern District of Illinois that
allege that SIRIUS XM, or certain call center vendors acting on
its behalf, made numerous calls which violate provisions of the
Telephone Consumer Protection Act of 1991 (the "TCPA"). The
plaintiffs in these actions allege, among other things, that
SIRIUS XM called mobile phones using an automatic telephone
dialing system without the consumer's prior consent or,
alternatively, after the consumer revoked their prior consent and,
in one of the actions, that SIRIUS XM violated the TCPA's call
time restrictions. The plaintiffs in these suits are seeking
various forms of relief, including statutory damages of $500 for
each violation of the TCPA or, in the alternative, treble damages
of up to $1,500 for each knowing and willful violation of the
TCPA, as well as payment of interest, attorneys' fees and costs,
and certain injunctive relief prohibiting violations of the TCPA
in the future. Plaintiffs in certain of these suits have filed a
motion with the Judicial Panel on Multidistrict Litigation to
transfer these purported class actions, and other allegedly
related cases, to the United States District Court for the
Northern District of Illinois for consolidated or coordinated
pretrial proceedings. SIRIUS XM believes it has substantial
defenses to the claims asserted in these actions and intends to
defend them vigorously.
SIRIUS XM has notified certain of its call center vendors of these
actions and requested that they defend and indemnify it against
these claims pursuant to the provisions of their existing or
former agreements with SIRIUS XM. SIRIUS XM believes it has valid
contractual claims against certain call center vendors in
connection with these claims and intends to preserve and pursue
its rights to recover from these entities.
LSB INDUSTRIES: Subsidiary Facing "Emmert" Class Action
-------------------------------------------------------
LSB Industries, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that a class action lawsuit
was filed on April 30, 2015, against the Company's subsidiary,
ClimateMaster, Inc. ("CM"), in the case styled Emmert, et al. v.
ClimateMaster, Inc., in the United States District Court, Western
District of Oklahoma.
The Company said, "CM is a subsidiary within our Climate Control
Business. The lawsuit alleges that a manufacturing defect in the
air conditioning and heat pump equipment manufactured by CM has
caused failures in certain valves used in such equipment resulting
in damages sustained by consumers and the contractors, and further
alleges that CM sold the equipment despite knowing of these
defects. The plaintiffs are alleging that there are more than 100
class members and that the aggregate amount in controversy exceeds
$5 million, exclusive of interest and costs. Plaintiffs seek
actual and punitive damages, together with recovery of certain
expenses. Because we have just been notified of this lawsuit, we
have not had an opportunity to investigate the claims contained
therein, but intend to vigorously defend this matter. We are also
investigating whether such claims come within our insurance
coverage, and, as of the date hereof, have not determined if the
claims alleged in the lawsuit are covered under our insurance
policy."
LUMBER LIQUIDATORS: Shareholder Sue Over Formaldehyde in Floorings
------------------------------------------------------------------
Amanda Bronstad, writing for The National Law Journal, reports
that Lumber Liquidators Holdings Inc., whose stock has plummeted
since a "60 Minutes" expose revealed that its hardwood laminate
flooring products contained illegal levels of formaldehyde, is
fending off a raft of shareholder lawsuits filed against its top
executives, many of whom have abruptly left the company.
The shareholder lawsuits are separate from the more than 100
consumer class actions coordinated before U.S. District Judge
Anthony Trenga in the Eastern District of Virginia.
Shareholders filed a consolidated derivative complaint on behalf
of Toano, Virginia-based Lumber Liquidators on June 26 against the
company's board and five officers, including three who have left
since the "60 Minutes" report on March 1. In April, the company
announced chief financial officer Daniel Terrell's resignation.
Chief executive officer Robert Lynch abruptly left in May.
William Schlegel, who was the head of merchandising, was fired
last month.
Those executives and Lumber Liquidators also moved last month to
dismiss a separate securities class action brought on behalf of
shareholders accusing them of securities fraud.
The lawsuits have proliferated since the "60 Minutes" piece
revealed Lumber Liquidators was working with Chinese mills that
didn't comply with the California Air Resources Board's
regulations on formaldehyde emissions.
Depending on the reasons, the high-profile executive departures
could bolster the shareholder litigation against Lumber
Liquidators, said John Coffee, a professor at Columbia Law School.
"If they're getting fired because they knew the company was
importing noncompliant products -- products that didn't comply
with California law -- that would be a case in which you can say
'Gee, that shows it was negligent,'" he said. "The case against
those fired officers would be somewhat stronger."
A Lumber Liquidators spokeswoman and Lyle Roberts --
lroberts@cooley.com -- a partner in the Washington office of Palo
Alto, Calif.-based Cooley who represents the company and its board
and officers, did not respond to a request for comment.
Both shareholder actions allege that Lumber Liquidators and its
executives misled investors in financial reports and conference
calls by attributing its increasing gross margins to improvements
in its business partnerships. Instead, the lawsuits allege,
Lumber Liquidators used illegally sourced, cheaper lumber and
partnered with Chinese mills that manufactured flooring products
with dangerous levels of formaldehyde.
The securities class action complaint originally was filed in
November 2013 following reports that federal agents had searched
the corporate offices of Lumber Liquidators. Since then, Lumber
Liquidators stock has plummeted from a peak of $119 a share to
less than $20.
On Feb. 25, Lumber Liquidators confirmed that the Justice
Department was considering criminal charges as part of an
investigation into whether the company violated the U.S. Lacey Act
by importing illegally sourced timber from protected forests in
Russia.
In the securities class action's amended complaint, filed on
April 22, plaintiffs allege that the misrepresentations of the
three executives and founder Thomas Sullivan, now interim CEO,
caused investor losses of $1.52 billion. The complaint, which
references the statements of six confidential witnesses, also
alleges that they had a financial incentive to conceal that
information because they cashed out millions of dollars of their
own stock during the class period.
"Our investigation showed the company was illegally sourcing wood
from China and that explained the exceptional gross margins that
Lumber Liquidators was able to achieve," said Jeremy Lieberman, a
partner at Pomerantz in New York, lead plaintiffs counsel in the
class action. "The recent resignations since the '60 Minutes'
episode only confirm the allegations that we had in the original
complaint. The company had too high levels of formaldehyde --
above levels by regulators -- in addition to illegally sourced
wood."
The class action was brought on behalf of anyone who purchased
Lumber Liquidators stock between February 22, 2012, and
February 27, 2015.
The defendants moved to dismiss that action on June 2, blaming
some of the stock drops on negative reports of short sellers and
refuting any knowledge of the noncompliance issues.
"The complaint identifies no document, witness, or other piece of
evidence establishing that any individual defendant -- or anyone
else at the company -- knew or was severely reckless in not
knowing of the supposed regulatory violations and their alleged
impact on Lumber Liquidators' financial performance," wrote
Roberts, of Cooley.
On July 14, U.S. District Judge Arenda Wright Allen of the Eastern
District of Virginia ordered that plaintiffs attorneys submit more
information by July 21 about the confidential witnesses cited in
their complaint after Lumber Liquidators discovered that one of
them, having been contacted, disputed making the statements.
Meanwhile, shareholders also have filed five derivative actions,
which are brought by shareholders on behalf of the company
generally against board members for failing to perform their
fiduciary duties. Two cases have been filed in state courts in
Virginia and Delaware, where the company is incorporated. On
June 17, Wright Allen consolidated three derivative actions in
federal court.
The defendants are due to file their motions to dismiss by
July 24.
Despite the higher hurdle of a derivative complaint,
Benny Goodman -- bennyg@rgrdlaw.com -- a partner at San Diego's
Robbins Geller Rudman & Dowd who filed the consolidated derivative
complaint, said the executive departures could demonstrate
wrongdoing.
"Often times, we see these kinds of mass resignations in the
corporate suite in light of massive wrongdoing when there's a big
financial scandal," he said. "In light of this, I think it's fair
to say we rarely see a major financial scandal like this that
doesn't originate from a failure of corporate governance."
M&T BANK: Parties in Securities Litigation Engaged in Discovery
---------------------------------------------------------------
M&T Bank Corporation said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the parties in the
case, In Re Wilmington Trust Securities Litigation (U.S. District
Court, District of Delaware, Case No. 10-CV-0990-SLR), are
currently engaged in the discovery phase of the lawsuit.
Beginning on November 18, 2010, a series of parties, purporting to
be class representatives, commenced a putative class action
lawsuit against Wilmington Trust, alleging that Wilmington Trust's
financial reporting and securities filings were in violation of
securities laws. The cases were consolidated and Wilmington Trust
moved to dismiss. The Court issued an order denying Wilmington
Trust's motion to dismiss on March 20, 2014.
MAXIM HEALTHCARE: Settles Employee's Overtime Class Action
----------------------------------------------------------
Brendan Pierson, writing for Reuters, reports that medical
staffing agency Maxim Healthcare Services Inc has settled a
lawsuit by a former employee accusing it of requiring employees to
work unpaid overtime, dodging a proposed class action before it
was certified.
U.S. District Judge Dale Fischer of the Central District of
California on July 16 granted a joint motion by Maxim and the
former employee, Leticia Vega, to drop the case. The two parties
said in that motion, filed on July 14, that they had settled but
did not disclose the terms.
MGM RESORTS: Court Heard Oral Argument on Class Cert. Bids
----------------------------------------------------------
MGM Resorts International said in its Form 10-Q Report filed with
the Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that in the case, In re MGM
MIRAGE Securities Litigation, Case No. 2:09-cv-01558-GMN-LRL, the
court heard oral argument on the class certification motion on
April 21, 2015 and took the matter under advisement.
In November 2009, the U.S. District Court for Nevada consolidated
the Robert Lowinger v. MGM MIRAGE, et al. (Case No. 2:09-cv-01558-
RCL-LRL, filed August 19, 2009) and Khachatur Hovhannisyan v. MGM
MIRAGE, et al. (Case No. 2:09-cv-02011-LRH-RJJ, filed October 19,
2009) putative class actions under the caption "In re MGM MIRAGE
Securities Litigation." The cases name the Company and certain
former and current directors and officers as defendants and allege
violations of Sections 10(b) and 20(a) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and Rule 10b-5
promulgated thereunder. After transfer of the cases in 2010 to
the Honorable Gloria M. Navarro, the court appointed several
employee retirement benefits funds as co-lead plaintiffs and their
counsel as co-lead and co-liaison counsel. In January 2011, lead
plaintiffs filed a consolidated amended complaint, alleging that
between August 2, 2007 and March 5, 2009, the Company, its
directors and certain of its officers violated Sections 10(b) and
20(a) of the Exchange Act and Rule 10b-5 thereunder.
In September 2013, the court denied defendants' motion to dismiss
plaintiffs' amended complaint. Defendants answered the amended
complaint, the court entered a scheduling order and discovery is
proceeding. Plaintiffs filed a motion for class certification in
November 2014. Defendants filed their opposition to class
certification in February 2015. The court heard oral argument on
the class certification motion on April 21, 2015 and took the
matter under advisement. No trial date has been set in this case.
"We and all other defendants will continue to vigorously defend
against the claims asserted in these securities cases," the
Company said.
MOHAWK INDUSTRIES: Settles Antitrust Claims by Purchasers
---------------------------------------------------------
Mohawk Industries, Inc. has entered into an agreement to settle
all claims brought by the class of direct purchasers, and an
agreement to settle all claims brought by the class of indirect
purchasers, the Company said in its Form 10-Q Report filed with
the Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended April 4, 2015.
Beginning in August 2010, a series of civil lawsuits were
initiated in several U.S. federal courts alleging that certain
manufacturers of polyurethane foam products and competitors of the
Company's carpet underlay division had engaged in price fixing in
violation of U.S. antitrust laws. The Company has been named as a
defendant in a number of individual cases (the first filed on
August 26, 2010), as well as in two consolidated amended class
action complaints the first filed on February 28, 2011, on behalf
of a class of all direct purchasers of polyurethane foam products,
and the second filed on March 21, 2011, on behalf of a class of
indirect purchasers. All pending cases in which the Company has
been named as a defendant have been filed in or transferred to the
U.S. District Court for the Northern District of Ohio for
consolidated pre-trial proceedings under the name In re:
Polyurethane Foam Antitrust Litigation, Case No. 1:10-MDL-02196.
In these actions, the plaintiffs, on behalf of themselves and/or a
class of purchasers, seek damages allegedly suffered as a result
of alleged overcharges in the price of polyurethane foam products
from at least 1999 to the present. The direct purchaser class
claimed damages from all of the defendants named in the lawsuit of
up to approximately $867,400. Any damages actually awarded at
trial are subject to being tripled under US antitrust laws. The
amount of damages in the remaining cases varies or has not yet
been specified by the plaintiffs. Each plaintiff also seeks
attorney fees, pre-judgment and post-judgment interest, court
costs and injunctive relief against future violations.
In April 2011, the Company filed a motion to dismiss the class
action claims brought by the direct purchasers, and in May 2011,
the Company moved to dismiss the claims brought by the indirect
purchasers. On July 19, 2011, the Court denied all defendants'
motions to dismiss. On April 9, 2014, the Court certified the
direct and indirect purchaser classes. The Company sought
permission to appeal the certification order on April 24, 2014,
and the petition was denied by the U.S. Court of Appeals for the
Sixth Circuit on September 29, 2014. The Company appealed the
Sixth Circuit's order to the United States Supreme Court, which
entered an order declining the review on March 2, 2015. Fact
discovery in almost all cases is now complete and, in August 2014,
the Company and other defendants filed motions for summary
judgment against the direct purchaser class. In February 2015, the
Court denied all summary judgment motions.
On April 23, 2015, the Court consolidated nine lawsuits involving
non-class claims filed against the Company by direct purchasers of
polyurethane foam. These consolidated cases have been scheduled
for trial to begin August 18, 2015. The Company has agreements in
principle to settle two of these cases and is preparing to file
motions for summary judgment with respect to the remaining seven
cases.
On March 23, 2015, the Company entered into an agreement to settle
all claims brought by the class of direct purchasers, and on April
30, 2015, the Company entered into an agreement to settle all
claims brought by the class of indirect purchasers. Both
settlement agreements are subject to court approval, which the
Company expects to receive. The Company continues to deny all
allegations of wrongdoing but is settling to avoid the
uncertainty, risk, expense and distraction of protracted
litigation.
The Company remains a defendant in a number of cases involving
other purchasers of polyurethane foam products not sold by the
Company. The amount of the damages in the remaining cases varies
or has not yet been specified by the plaintiffs. Each plaintiff
also seeks attorney fees, pre-judgment and post-judgment interest,
court costs and injunctive relief against future violations.
MOHAWK INDUSTRIES: Reached Agreement to Settle Canadian Actions
---------------------------------------------------------------
Mohawk Industries, Inc. has reached an agreement in principle to
settle the Canadian actions, but the settlement has not yet been
finalized, the Company said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended April 4, 2015.
In December 2011, the Company was named as a defendant in a
Canadian Class action, Hi! Neighbor Floor Covering Co. Limited v.
Hickory Springs Manufacturing Company, et al., filed in the
Superior Court of Justice of Ontario, Canada and Options
Consommateures v. Vitafoam, Inc. et.al., filed in the Superior
Court of Justice of Quebec, Montreal, Canada, both of which allege
similar claims against the Company as raised in the U.S. actions
and seek unspecified damages and punitive damages. The Company
denies all of the allegations in these actions and will vigorously
defend itself. The Company has reached an agreement in principle
to settle the Canadian actions, but the settlement has not yet
been finalized.
MRI INTERNATIONAL: 3 Executives Indicted in Investment Fraud Case
-----------------------------------------------------------------
Ken Ritter, writing for The Associated Press, reports that
authorities in the U.S. are seeking the arrest of the chief
executive of a Las Vegas investment company and two of his former
Asia-based executives on an indictment alleging they headed a $1.5
billion Ponzi-style fraud scheme, officials announced on July 8.
Edwin Fujinaga of Las Vegas, and Junzo Suzuki and Paul Suzuki,
both of Tokyo, were each indicted on eight counts of mail fraud
and nine counts of wire fraud in a scheme that prosecutors and the
FBI said operated through Las Vegas-based MRI International Inc.
Thousands of unsuspecting Japanese investors were victimized,
Assistant U.S. Attorney General Leslie Caldwell said.
Mr. Fujinaga, 68, also is charged with three counts of money
laundering, and the indictment filed in U.S. District Court in Las
Vegas seeks from the three defendants the forfeiture of the
proceeds of their alleged crimes. They could face decades in
prison if they are convicted.
Attorneys listed in federal court records as having represented
Mr. Fujinaga; Junzo Suzuki, 66; and his son, Paul Suzuki, 36, in
other cases didn't immediately respond to telephone and email
messages seeking comment.
The indictment was announced by Ms. Caldwell and two top federal
law officials in Nevada, U.S. Attorney Daniel Bogden and FBI
Special Agent in Charge Laura Bucheit in Las Vegas. It identifies
Mr. Fujinaga as former president and chief executive of MRI, Junzo
Suzuki as the firm's Asia Pacific executive vice president and
Paul Suzuki as general manager for Japan operations.
Mr. Bogden said they told thousands of overseas victims that their
investments would be safely held and managed by an independent,
third-party escrow agent in Nevada.
Meanwhile, Mr. Fujinaga and the Suzukis are accused of using
investors' funds to pay for gambling, travel by private jet and
other personal expenses.
The scheme operated for at least four years before it was exposed
in April 2013, according to the charging document.
Investments were primarily sold through the company service center
in Tokyo, promising high returns and low risk through a technique
dubbed "factoring." The company promised high returns buying
accounts receivable from medical providers at a discount, then
attempting to recover more than the discounted amount from the
debtor.
The government alleges the Ponzi scheme defrauded victims by using
money from new enrollees to pay early-stage investors and persuade
others to take part.
The largest Ponzi-style fraud in U.S. history, involving New York
financier Bernard Madoff, bilked investors of an estimated $20
billion. Mr. Madoff was convicted in 2009 and sentenced to 150
years in prison.
Accounting executive set for sentencing in Madoff fraud case
By The Associated Press
MYLAN N.V.: Accrued $13.9MM on Product Liability at March 31
------------------------------------------------------------
Mylan N.V. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that the Company is involved in a number of
product liability lawsuits and claims related to alleged personal
injuries arising out of certain products manufactured and/or
distributed by the Company, including but not limited to its
Fentanyl Transdermal System, Phenytoin, Propoxyphene and
Alendronate. The Company believes that it has meritorious defenses
to these lawsuits and claims and is vigorously defending itself
with respect to those matters. From time to time, the Company has
agreed to settle or otherwise resolve certain lawsuits and claims
on terms and conditions that are in the best interests of the
Company. The Company had accrued approximately $13.9 million at
March 31, 2015 and $13.4 million at December 31, 2014. It is
reasonably possible that we will incur additional losses above the
amount accrued but we cannot estimate a range of such reasonably
possible at this time. There are no assurances, however, that
settlements reached and/or adverse judgments received, if any,
will not exceed amounts accrued.
NAT'L COLLEGIATE: Judge Okays $60MM Athlete Likeness Settlement
---------------------------------------------------------------
The Associated Press reports that a federal judge approved a $60
million settlement for college athletes in a class action lawsuit
filed against the NCAA and video-game maker Electronics Arts.
Steve Berman, a Seattle-based attorney for the plaintiffs
confirmed on July 17 that U.S. District Judge Claudia Wilken had
approved the settlement during a hearing on July 16.
Judge Wilken also ruled against the NCAA in the O'Bannon case,
which challenges the NCAA's use of the names, images and
likenesses of college athletes. That ruling is being appealed by
the NCAA.
The plaintiffs in the case against the NCAA and EA claimed they
illegally used college football and basketball players' names and
likenesses in video games for years. Players who have appeared in
EA's NCAA football and basketball games have until July 31 to make
a claim on part of the settlement.
NEW JERSEY: Judge Tosses Class Action Over Bridgegate Scandal
-------------------------------------------------------------
Charles Toutant, writing for New Jersey Law Journal, reports that
a federal judge in Newark has dismissed the putative class-action
suit brought by individuals and businesses who experienced traffic
delays related to the Bridgegate scandal.
The suit, which names an assortment of figures related to the
closure of access lanes to the George Washington Bridge from Fort
Lee in September 2013 as defendants, fails to explain each
defendant's role in those lane closures, U.S. District Judge Jose
Linares of the District of New Jersey said in Galicki v. State of
New Jersey.
Despite extensive media coverage and government scrutiny of the
lane closings, the plaintiffs offered only conclusory allegations
about the defendants as a group, and failed to make allegations
about the individual involvement of any defendant, as is required
to put those parties on notice of the allegations they face, Judge
Linares said.
Judge Linares dismissed three counts of the case with prejudice
and eight others without prejudice. The plaintiffs have until
Aug. 6 to file an amended complaint.
"The court has carefully read through the consolidated class
action amended complaint and finds that nearly every reference to
all defendants is conclusory and made in the context of a
formulaic recitation of the elements of plaintiffs' various
claims," Judge Linares said.
The named plaintiffs include several taxi services and other local
businesses in Fort Lee, as well as individuals who claim they
suffered economic damages or physical or psychological injury as a
result of the lane closures. The suit claims the defendants were
part of a scheme to cause traffic delays in Fort Lee in
retaliation for the refusal of the town's Democratic mayor, Mark
Sokolich, to endorse Christie's re-election campaign.
Defendants include the Port Authority of New York and New Jersey,
the state of New Jersey and Christie's re-election campaign.
Defendants also include Bridget Kelly, Christie's former deputy
chief of staff; David Wildstein, a Christie appointee to the Port
Authority; former Port Authority deputy executive director Bill
Baroni; Bill Stepien, a former deputy chief of staff to Christie;
and Michael Drewniak, a former press secretary to Christie.
Ms. Kelly and Mr. Baroni were indicted by a federal grand jury on
charges related to the lane closures and pleaded not guilty May 4.
Mr. Wildstein, the former director of capital projects at the Port
Authority, pleaded guilty to one count each of conspiracy to
misapply Port Authority property and conspiracy against civil
rights. Mr. Wildstein is cooperating with federal investigators.
In the class action case, Judge Linares dismissed the plaintiffs'
claim under 42 U.S.C. 1985 with prejudice. He said the plaintiffs
failed to allege facts that support that claim, which requires an
allegation of a conspiracy to deprive the rights of a group of
persons based on their membership in a race or class that has been
historically subject to discrimination.
The judge also dismissed a claim under 42 U.S.C. 1986 with
prejudice, since that count relies on a pre-existing Section 1985
claim. Also dismissed with prejudice was a claim under 42 U.S.C.
1988 for attorney fees to the prevailing party.
The judge dismissed without prejudice claims for 42 U.S.C. 1983;
and for vicarious liability against the state, the Port Authority
and the Christie campaign, claiming they are responsible for the
actions of their agents, employees or servants. Also dismissed
without prejudice were claims under New Jersey's Racketeer
Influenced and Corrupt Organizations Act, the New Jersey Civil
Rights Act, common-law civil conspiracy, the New Jersey Consumer
Fraud Act, breach of contract and respondeat superior.
Lead class counsel Barry Epstein said he plans to refile a
complaint that will address the judge's concerns. All the
defendants in the current case would be included in the amended
complaint, he said.
Mr. Epstein, of the Epstein Law Firm in Rochelle Park, noted that
his case was first filed in state court, where the pleading
standards are different than in federal court, and was removed to
federal court at the state's request. In addition, when the suit
was first filed, he didn't have the benefit of Mr. Wildstein's
plea agreement and the indictments of Ms. Kelly and Mr. Baroni, he
said. Documents related to those events have since provided "an
abundance" of information, he said.
"We don't really consider this a real setback. This is not
unusual in federal class cases," Mr. Epstein said. "I don't
believe any of the defendants will be doing handstands over this
ruling. The case is not dismissed and it will be refiled."
Mr. Epstein noted that Linares felt eight of the 11 counts in the
case were viable, as evidenced by their dismissal without
prejudice.
Lee Moore, a spokesman for the state Attorney General's Office,
which represents the state and Drewniak, declined to comment on
the ruling, as did Steve Coleman, a spokesman for the Port
Authority.
Kevin Marino, who represents Mr. Stepien, said that "the
complaint, neither as written nor as they propose to amend it,
states a claim against Mr. Stepien. I hope they see that and
decide not to include him in the subsequent suit. If they choose
to again name Mr. Stepien as a defendant, we are confident the
complaint will again be dismissed, this time with prejudice."
Lawyers for the other defendants in the case did not return calls
about the ruling.
NEW YORK, NY: Settles Occupy Wall Street Pepper Spray Suits
-----------------------------------------------------------
Mark Hamblett, writing for Law.com, reports that civil rights
claims brought by Occupy Wall Street protestors who were pepper
sprayed by a high-ranking police officer during a 2011
demonstration have been settled by New York City for more than
$300,000.
Lawyers for six people who were sprayed by Deputy Inspector
Anthony Bologna while marching near Union Square in 2011 filed
papers in the Southern District saying five cases filed by the six
over the incident were settled for between $52,500 and $60,000.
On Sept. 24, 2011, police penned in marchers with orange netting,
and Bologna was caught on video pepper spraying the group
apparently without provocation -- a move that generated support
for the Occupy movement.
Dara Weiss, senior counsel at the Law Department, wrote to
Southern District Magistrate Judge Michael Dollinger that
settlements had been reached in the cases, led by Elliot v. City
of New York, 12-cv-0992.
Plaintiffs' attorney Aymen Aboushi represented both Chelsea
Elliot, a marcher against income inequality who was sprayed by
Bologna while demonstrating, and a second plaintiff in that case,
Jeanne Mansfield.
Ms. Mansfield "was checking out the demonstration and she got
penned in and was sprayed," Mr. Abousi said on July 6.
Both received $60,000 settlements out of the total $332,500 paid
out by New York City.
ORRSTOWN FINANCIAL: Court Ruling on Motion to Dismiss Pending
-------------------------------------------------------------
Orrstown Financial Services, Inc. said in its Form 10-Q Report
filed with the Securities and Exchange Commission on May 8, 2015,
for the quarterly period ended March 31, 2015, that the Court's
ruling on the motions to dismiss the class action complaint filed
by Southeastern Pennsylvania Transportation Authority ("SEPTA") is
pending.
On May 25, 2012, Southeastern Pennsylvania Transportation
Authority ("SEPTA") filed a putative class action complaint in the
United States District Court for the Middle District of
Pennsylvania against the Company, the Bank and certain current and
former directors and executive officers (collectively, the
"Defendants"). The complaint alleges, among other things, that (i)
in connection with the Company's Registration Statement on Form S-
3 dated February 23, 2010 and its Prospectus Supplement dated
March 23, 2010, and (ii) during the purported class period of
March 24, 2010 through October 27, 2011, the Company issued
materially false and misleading statements regarding the Company's
lending practices and financial results, including misleading
statements concerning the stringent nature of the Bank's credit
practices and underwriting standards, the quality of its loan
portfolio, and the intended use of the proceeds from the Company's
March 2010 public offering of common stock. The complaint asserts
claims under Sections 11, 12(a) and 15 of the Securities Act of
1933, Sections 10(b) and 20(a) of the Securities Exchange Act of
1934 and Rule 10b-5 promulgated thereunder, and seeks class
certification, unspecified money damages, interest, costs, fees
and equitable or injunctive relief. Under the Private Securities
Litigation Reform Act of 1995 ("PSLRA"), motions for appointment
of Lead Plaintiff in this case were due by July 24, 2012. SEPTA
was the sole movant and the Court appointed SEPTA Lead Plaintiff
on August 20, 2012.
Pursuant to the PSLRA and the Court's September 27, 2012 Order,
SEPTA was given until October 26, 2012 to file an amended
complaint and the Defendants until December 7, 2012 to file a
motion to dismiss the amended complaint. SEPTA's opposition to the
Defendant's motion to dismiss was originally due January 11, 2013.
Under the PSLRA, discovery and all other proceedings in the case
are stayed pending the Court's ruling on the motion to dismiss.
The September 27, 2012 Order specified that if the motion to
dismiss were denied, the Court would schedule a conference to
address discovery and the filing of a motion for class
certification. On October 26, 2012, SEPTA filed an unopposed
motion for enlargement of time to file its amended complaint in
order to permit the parties and new defendants to be named in the
amended complaint time to discuss plaintiff's claims and
defendants' defenses. On October 26, 2012, the Court granted
SEPTA's motion, mooting its September 27, 2012 scheduling Order,
and requiring SEPTA to file its amended complaint on or before
January 16, 2013 or otherwise advise the Court of circumstances
that require a further enlargement of time. On January 14, 2013,
the Court granted SEPTA's second unopposed motion for enlargement
of time to file an amended complaint on or before March 22, 2013.
On March 4, 2013, SEPTA filed an amended complaint. The amended
complaint expands the list of defendants in the action to include
the Company's independent registered public accounting firm and
the underwriters of the Company's March 2010 public offering of
common stock. In addition, among other things, the amended
complaint extends the purported 1934 Exchange Act class period
from March 15, 2010 through April 5, 2012.
Pursuant to the Court's March 28, 2013 Second Scheduling Order, on
May 28, 2013 all defendants filed their motions to dismiss the
amended complaint, and on July 22, 2013 SEPTA filed its "omnibus"
opposition to all of the defendants' motions to dismiss. On August
23, 2013, all defendants filed reply briefs in further support of
their motions to dismiss. On December 5, 2013, the Court ordered
oral argument on the Orrstown Defendants' motion to dismiss the
amended complaint to be heard on February 7, 2014. Oral argument
on the pending motions to dismiss SEPTA's amended complaint was
held on April 29, 2014.
On April 10, 2015, pursuant to Court order, all parties filed
supplemental briefs addressing the impact of the United States
Supreme Court's March 24, 2015 decision in Omnicare, Inc. v.
Laborers District Council Construction Industry Pension Fund on
defendants' motions to dismiss the amended complaint. The Court's
ruling on the motions to dismiss is pending.
The Second Scheduling Order stays all discovery in the case
pending the outcome of the motions to dismiss, and informs the
parties that, if required, a telephonic conference to address
discovery and the filing of SEPTA's motion for class certification
will be scheduled after the Court's ruling on the motions to
dismiss.
The matter is currently progressing through the legal process. The
Orrstown Defendants believe that the allegations in the amended
complaint are without merit and intend to defend themselves
vigorously against those claims. Considering that no ruling has
been made on the motions to dismiss, discovery in the proceeding
remains stayed and class certification has not been granted, it is
not possible to estimate reasonably possible losses, or even a
range of reasonably possible losses, at this time in connection
with SEPTA's putative class action complaint.
PAIN THERAPEUTICS: Plaintiffs Ordered to Start Over Remoxy Trial
----------------------------------------------------------------
David Bario, writing for Law.com, reports that U.S. District Judge
Sam Sparks in Austin isn't one to mince words. There was that
time he invited lawyers in a case before him to a "kindergarten
party" to get up to speed on the law, or when he mocked some other
unfortunate lawyers in rhyming couplets. Judge Sparks got so fed
up with a 4-year-old securities class action against drugmaker
Pain Therapeutics Inc. that he ordered the plaintiffs lawyers
nearly back to square one, scuttling a jury trial that was all set
to begin on July 7.
"We're going to start over," Judge Sparks said at a July 7 hearing
-- the same day he had been expecting to start picking a jury.
"None of you want this trial. And believe me, I wasn't looking
forward to it for four years."
What got Judge Sparks so riled up? According to a transcript of
the July 7 hearing, it appears that the trial was about to proceed
on the plaintiffs' class claims despite a failure to notify the
class. Both sides blamed the other for that omission, which the
judge learned about from a flurry of eleventh-hour briefs that
welcomed him home from an Independence Day holiday vacation.
"I had to take my bride to Colorado for July Fourth, because
that's where she likes to go," Judge Sparks told the lawyers.
"Got up and got scolded badly because we were all going to some
nice facilities there in Aspen, and I spent 10 hours preparing for
trial."
Judge Sparks continued: "I get in this morning . . . and I've got
an opposed motion for an order establishing a program and schedule
for notice to the class and continuance of trial. The class
lawyers, where have y'all been? There's an answer for that. You
haven't been anywhere."
So, the judge asked, "what do I do with you?"
First, the judge granted the defendants' motion to allow for class
notices and continue the trial, siding with defense counsel at
Boies, Schiller & Flexner. (That's after saying he was "shocked"
at Boies Schiller's last-minute motion, complaining that "I had my
tux on, I had a pink carnation, I had an orchestra, and you didn't
want to come to the dance.") But Judge Sparks didn't just postpone
the trial for a few weeks. He vacated nearly all his prior
rulings in the case, reopened discovery, told the plaintiffs to
look for new experts, and set a new trial date . . . for 2017.
And the kicker? Judge Sparks also told the plaintiffs, who claimed
that Pain Therapeutics deceived investors about its failed efforts
to win FDA approval for its flagship prescription painkiller,
Remoxy, that they had a lousy case.
"It's a weak case," the judge said at the July 7 hearing. "I had
real doubts that you could get a jury verdict."
Ouch.
The plaintiffs are represented by class counsel at Pomerantz (the
judge did not vacate a prior order certifying the class). Boies
Schiller's Joshua Schiller -- jischiller@bsfllp.com -- represents
the defendants. Mr. Schiller told Law.com on July 8 that the
judge made the right call, but that the defendants were prepared
to try the case whatever Judge Sparks decided. "Whether it's two
months or two years, the facts are the facts," he said. "These
guys didn't commit securities fraud."
PHILIP MORRIS: Marlboro Lights Notification Program Begins
----------------------------------------------------------
The Circuit Court for Pulaski County, Arkansas disclosed that a
notification program to consumers who bought Marlboro Lights and
Marlboro Ultra Lights cigarettes in Arkansas began on July 17,
2015, as authorized by the Circuit Court for Pulaski County,
Arkansas.
The notices are a result of the Court establishing or "certifying"
a class action lawsuit about whether Philip Morris USA Inc.
deceptively advertised, marketed and sold Marlboro Lights and
Marlboro Ultra Lights cigarettes to consumers in Arkansas as
healthier to smoke than regular cigarettes. This case does not
involve claims for physical injury, emotional distress or wrongful
death. The lawsuit is called Miner v. Philip Morris Companies,
Inc., et al., No. 60CV03-4661.
The Pulaski County Circuit Court decided that the Class includes
all consumers who purchased Marlboro Lights and Marlboro Ultra
Lights cigarettes in Arkansas for personal consumption from
November 1, 1971 through June 22, 2010. "Marlboro Lights"
includes Marlboro Lights 100s cigarettes; "Marlboro Ultra Lights"
includes Marlboro Ultra Lights 100s cigarettes.
The lawsuit alleges that Philip Morris advertised, marketed and
sold Marlboro Lights and Marlboro Ultra Lights cigarettes as
healthier than regular cigarettes in a manner that had the
capacity to deceive consumers who purchased Marlboro Lights and
Marlboro Ultra Lights in Arkansas. The lawsuit also says that
Philip Morris knew Marlboro Lights and Marlboro Ultra Lights
cigarettes were more carcinogenic and toxic than regular
cigarettes and that Philip Morris' conduct violated the Arkansas
Deceptive Trade Practices Act. The suit seeks to recover money
from Philip Morris.
Philip Morris denies the allegations in the lawsuit. It denies
all wrongdoing, including that it violated Arkansas law by
advertising, marketing and selling Marlboro Lights and Marlboro
Ultra Lights cigarettes as healthier than regular cigarettes in a
manner that had the capacity to deceive consumers who purchased
Marlboro Lights and Marlboro Ultra Lights in Arkansas. Phillip
Morris also denies that it knew Marlboro Lights and Marlboro Ultra
Lights cigarettes were more carcinogenic and toxic than regular
cigarettes, that a class action is proper, and that Class members
are entitled to any relief. Phillip Morris believes that Class
members' claims may be barred on various legal grounds, including
the statute of limitations.
The lawyers for the Class will have to prove their claims at a
trial. The trial is currently set to begin August 2, 2016.
The Court has appointed the following lawyers as "Class Counsel":
Thomas Thrash, Don Barrett, Ben Barnow, Marcus Bozeman and Brian
Herrington.
Those who wish to remain members of the Class do not have to do
anything at this time and will be informed about any claims
process that results from the trial or any settlement. Class
members will be notified if there are future steps they may be
required to take, including perhaps being available to testify in
court or in a deposition. Class members will be bound by all
orders and judgments of the Court.
Class members may exclude themselves from the Class. A detailed
notice available at www.MarlboroLightsClass.com and by calling 1-
877-625-9432 explains how to request exclusion. People who
exclude themselves from the Class cannot receive money from the
lawsuit -- if any is won -- but they will not be bound by any
Court orders or judgments. The deadline to request exclusion is
January 13, 2016.
For more information and a detailed notice, Class members may
visit www.MarlboroLightsClass.com or call 1-877-625-9432.
POST HOLDINGS: Class Cert. Phase of Antitrust Case On Going
-----------------------------------------------------------
Post Holdings, Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the class-
certification phase of the antitrust case is currently in process.
In late 2008 and early 2009, some 22 class-action lawsuits were
filed in various federal courts against Michael Foods, Inc. and
approximately 20 other defendants (producers of shell eggs,
manufacturers of processed egg products, and egg industry
organizations), alleging violations of federal and state antitrust
laws in connection with the production and sale of shell eggs and
egg products, and seeking unspecified damages. In December 2008,
the Judicial Panel on Multidistrict Litigation ordered the
transfer of all cases to the Eastern District of Pennsylvania for
coordinated and/or consolidated pretrial proceedings.
Between late 2010 and early 2012, a number of companies, each of
which would be part of the purported class in the antitrust
action, brought separate actions against defendants. These "tag-
along" cases, brought primarily by various grocery chains and food
companies, assert essentially the same allegations as in the main
action. All but one of the tag-along cases were either filed in or
transferred to the Eastern District of Pennsylvania, where they
are being treated as related to the main action.
Fact discovery concluded on April 30, 2014. The class-
certification phase of the case is currently in process. Hearings
on class certification occurred on March 10-11, 2015 for direct
purchaser plaintiffs and April 20-21, 2015 for indirect purchaser
plaintiffs.
Michael Foods received a Civil Investigative Demand ("CID") issued
by the Florida Attorney General on November 27, 2008, regarding an
investigation of possible anticompetitive activities "relating to
the production and sale of eggs or egg products." The CID
requested information and documents related to the pricing and
supply of shell eggs and egg products, as well as our
participation in various programs of United Egg Producers. Michael
Foods has fully cooperated with the Florida Attorney General's
Office to date. Further compliance is suspended pending
proceedings in the civil antitrust litigation.
"We do not believe it is possible to estimate the loss in
connection with these litigated matters. Accordingly, we cannot
predict what impact, if any, these matters and any results from
such matters could have on our future results of operations," the
Company said.
PROTECTIVE LIFE: Claims in Delaware Action Won't Be Released
------------------------------------------------------------
Protective Life Corporation said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that the claims in the
Delaware class action will not be released until the stipulation
of settlement is approved by the Court of Chancery of the State of
Delaware.
The Company said, "After the entry into the Merger Agreement on
June 3, 2014, four lawsuits were filed against the Company, our
then current directors, Dai-ichi Life and DL Investment
(Delaware), Inc. on behalf of alleged Company shareowners. On June
11, 2014, a putative class action lawsuit styled Edelman, et al.
v. Protective Life Corporation, et al., Civil Action No. 01-CV-
2014-902474.00, was filed in the Circuit Court of Jefferson
County, Alabama. On July 30, 2014, the plaintiff in Edelman filed
an amended complaint. Three putative class action lawsuits were
filed in the Court of Chancery of the State of Delaware, Martin,
et al. v. Protective Life Corporation, et al., Civil Action No.
9794-CB, filed June 19, 2014, Leyendecker, et al. v. Protective
Life Corporation, et al., Civil Action No. 9931-CB, filed July 22,
2014 and Hilburn, et al. v. Protective Life Corporation, et al.,
Civil Action No. 9937-CB, filed July 23, 2014. The Delaware Court
of Chancery consolidated the Martin, Leyendecker, and Hilburn
actions under the caption In re Protective Life Corp. Stockholders
Litigation, Consolidated Civil Action No. 9794-CB, designated the
Hilburn complaint as the operative consolidated complaint (the
"Delaware Action") and appointed Charlotte Martin, Samuel J.
Leyendecker, Jr., and Deborah J. Hilburn to serve as co-lead
plaintiffs. These lawsuits allege that our Board of Directors
breached its fiduciary duties to the Company's shareowners, that
the Merger involves an unfair price, an inadequate sales process,
and unreasonable deal protection devices that purportedly preclude
competing offers, and that the preliminary proxy statement filed
with the SEC on July 10, 2014 failed to disclose purportedly
material information. The complaints also alleged that the
Company, Dai-ichi Life and DL Investment (Delaware), Inc. aided
and abetted those alleged breaches of fiduciary duties. The
complaints seek injunctive relief, including enjoining or
rescinding the Merger, and attorneys' and other fees and costs, in
addition to other relief. The Delaware Action also seeks an award
of unspecified damages."
"With respect to the Edelman lawsuit, on September 5, 2014, the
court held a hearing to address motions to dismiss the lawsuit
filed on behalf of the Company, the members of the Company's
Board, and DL Investment (Delaware), Inc. On September 19, 2014,
the court granted those motions and dismissed the Edelman lawsuit
in its entirety and with prejudice, pending a possible appeal by
the plaintiff.
"With respect to the Delaware Action, on September 24, 2014, the
Company, each of the members of the Company's Board, Dai-ichi
Life, and DL Investment (Delaware), Inc. entered into a Memorandum
of Understanding (the "MOU") with the plaintiffs in that case,
which sets forth the parties' agreement in principle for a
settlement of the Delaware Action. As set forth in the MOU, the
Company, the members of the Company's Board, Dai-ichi Life, and DL
Investment (Delaware), Inc. agreed to the settlement solely to
eliminate the burden, expense, distraction, and uncertainties
inherent in further litigation, and without admitting any
liability or wrongdoing. The MOU contemplates that the parties
will seek to enter into a stipulation of settlement providing for
the certification of a mandatory non opt-out class, for settlement
purposes only, to include any and all record and beneficial owners
of shares (excluding the members of the Company's Board and their
immediate family members, any entity in which any member of the
Company's Board has a controlling interest, and any successors in
interest thereto) that held shares at any time during the period
beginning on June 3, 2014, through the date of consummation or
termination of the Merger, including any and all of their
respective successors in interest, successors, predecessors in
interest, representatives, trustees, executors, administrators,
heirs, assigns, or transferees, immediate and remote, and any
person or entity acting for or on behalf of, or claiming under,
any of them, together with their predecessors, successors and
assigns, and a global release of claims relating to the Merger as
set forth in the MOU.
"As part of the settlement, the Company agreed to make certain
additional disclosures related to the Merger which are set forth
in the Company's Form 8-K filed on September 25, 2014 and which
supplement the information contained in the Company's definitive
proxy statement filed with the SEC on August 25, 2014, as amended
on August 27, 2014. Nothing in the Form 8-K or any stipulation of
settlement shall be deemed an admission of the legal necessity or
materiality of any of the disclosures set forth in the Form 8-K.
The claims in the Delaware Action will not be released until the
stipulation of settlement is approved by the Court of Chancery of
the State of Delaware. The proposed settlement would have no
effect on the consideration received by Company shareowners in
connection with the completion of the Merger. There can be no
assurance, however, that the court will approve the proposed
settlement, nor can there be any assurance as to the size of any
award of attorneys' fees and expenses to the plaintiffs' counsel.
The Company cannot provide assurances as to the ultimate
settlement of the Delaware Action or with respect to any lawsuits
regarding the Merger that may be filed in the future."
RAYONIER INC: Aug. 25 Hearing on Bid to Dismiss Class Action
------------------------------------------------------------
Rayonier Inc. said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the court has set a
hearing on the motion to dismiss a consolidated class action
complaint for August 25, 2015.
Following the Company's November 10, 2014 earnings release and
filing of the restated interim financial statements for the
quarterly periods ended March 31, 2014 and June 30, 2014 (the
"November 2014 Announcement"), shareholders of the Company filed
five putative class actions against the Company and Paul G.
Boynton, Hans E. Vanden Noort, David L. Nunes, and H. Edwin Kiker
arising from circumstances described in the November 2014
Announcement, entitled respectively:
* Sating v. Rayonier Inc. et al, Civil Action No. 3:14-cv-
01395; filed November 12, 2014 in the United States District Court
for the Middle District of Florida;
* Keasler v. Rayonier Inc. et al, Civil Action No. 3:14-cv-
01398, filed November 13, 2014 in the United States District Court
for the Middle District of Florida;
* Lake Worth Firefighters' Pension Trust Fund v. Rayonier
Inc. et al, Civil Action No. 3:14-cv-01403, filed November 13,
2014 in the United States District Court for the Middle District
of Florida;
* Christie v. Rayonier Inc. et al, Civil Action No. 3:14-cv-
01429, filed November 21, 2014 in the United States District Court
for the Middle District of Florida; and
* Brown v. Rayonier Inc. et al, Civil Action No. 1:14-cv-
08986, initially filed in the United States District Court for the
Southern District of New York and later transferred to the United
States District Court for the Middle District of Florida and
assigned as Civil Action No. 3:14-cv-01474.
On January 9, 2015, the five securities actions were consolidated
into one putative class action entitled In re Rayonier Inc.
Securities Litigation, Case No. 3:14-cv-01395-TJC-JBT, in the
United States District Court for the Middle District of Florida.
The plaintiffs alleged that the defendants made false and/or
misleading statements in violation of Sections 10(b) and 20(a) of
the Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder. The plaintiffs sought unspecified monetary damages and
attorneys' fees and costs. Two shareholders, the Pension Trust
Fund for Operating Engineers and the Lake Worth Firefighters'
Pension Trust Fund moved for appointment as lead plaintiff on
January 12, 2015, which was granted on February 25, 2015. On April
7, 2015, the plaintiffs filed a Consolidated Class Action
Complaint (the "Amended Complaint"). In the Amended Complaint,
plaintiffs added allegations as to and added as a defendant N.
Lynn Wilson, a former officer of Rayonier. Although the Amended
Complaint does not contain any allegations as to David L. Nunes or
H. Edwin Kiker, they have not yet been formally dismissed from the
case as defendants. Defendants' Motion to Dismiss was due not
later than May 15, 2015. The court has set a hearing on the motion
for August 25, 2015. At this preliminary stage, the Company cannot
determine whether there is a reasonable possibility that a loss
has been incurred nor can the range of any potential loss be
estimated.
REGIONAL MANAGEMENT: Continues to Defend Securities Suit in SDNY
----------------------------------------------------------------
Regional Management Corp. said in its Form 10-Q Report filed with
the Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the Defendants' reply
was due on July 13, 2015, in a securities class action lawsuit.
On May 30, 2014, a securities class action lawsuit was filed in
the United States District Court for the Southern District of New
York against the Company and certain of its current and former
directors, executive officers, and shareholders (collectively, the
"Defendants"). The complaint alleged violations of the Securities
Act of 1933 ("1933 Act Claims") and sought unspecified
compensatory damages and other relief on behalf of a purported
class of purchasers of the Company's common stock in the September
2013 and December 2013 secondary public offerings. On August 25,
2014, Waterford Township Police & Fire Retirement System and City
of Roseville Employees' Retirement System were appointed as lead
plaintiffs (collectively, the "Plaintiffs"). An amended complaint
was filed on November 24, 2014. In addition to the 1933 Act
Claims, the amended complaint also added claims for violations of
the Securities Exchange Act of 1934 ("1934 Act Claims") seeking
unspecified compensatory damages on behalf of a purported class of
purchasers of the Company's common stock between May 2, 2013 and
October 30, 2014, inclusive.
On January 26, 2015, the Defendants filed motions to dismiss the
amended complaint in its entirety. In response, the Plaintiffs
sought and were granted leave to file an amended complaint. On
February 27, 2015, the Plaintiffs filed a second amended
complaint. Like the prior amended complaint, the second amended
complaint asserts 1933 Act Claims and 1934 Act Claims and seeks
unspecified compensatory damages. The Defendants' motions to
dismiss the second amended complaint were filed on April 28, 2015.
The Plaintiffs' opposition was due on June 12, 2015, and the
Defendants' reply is due on July 13, 2015. The Company believes
that the claims against it are without merit and intends to defend
against the litigation vigorously.
RENASANT CORPORATION: Facing Stein v. Heritage Class Action
-----------------------------------------------------------
Renasant Corporation said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that a putative stockholder
class action lawsuit, Stein v. Heritage Financial Group, Inc. et
al., was filed on December 31, 2014, in the Circuit Court for
Baltimore City, Maryland, Civil Division, against Heritage
Financial Group, Inc. ("Heritage"), the members of its board of
directors, HeritageBank of the South, the Company and Renasant
Bank. The complaint, which was amended on February 18, 2015,
alleges that the Heritage directors breached their fiduciary
duties and/or violated Maryland law in connection with the
negotiation and approval of the merger agreement by failing to
maximize shareholder value and failing to disclose material
information in the February 9, 2015 preliminary joint proxy
statement/prospectus and that Heritage, HeritageBank of the South,
the Company and Renasant Bank aided and abetted those alleged
breaches of fiduciary duties. In addition to monetary damages in
an unspecified amount and other remedies, the lawsuit seeks to
enjoin Heritage stockholders from voting on the merger at the
Heritage special meeting scheduled for June 16, 2015 and the
Company's stockholders from voting on the merger at the Company's
special meeting scheduled for June 16, 2015 and to otherwise
enjoin the directors from consummating the merger.
SABRE: Faces Class Action in New York Over Alleged GDS Collusion
----------------------------------------------------------------
Robert Silk, writing for Travel Weekly, reports that a group of 21
plaintiffs from across the U.S. have filed a class-action
complaint against Sabre, Travelport and Amadeus, accusing the GDS
providers of collusion and of engaging in practices designed to
thwart competition.
The plaintiffs are seeking injunctive relief to correct the "anti-
competitive market effects" allegedly caused by the GDS providers
as well as unspecified cash damages.
All three GDS companies said they would "vigorously" fight the
case in statements to Travel Weekly.
The 104-page suit, filed on July 14 in the U.S. District Court for
the Southern District of New York, centers its allegations on
contracts the GDS companies entered into with airlines in 2006,
after the DOT stopped regulating distribution systems. Those
contracts require airlines to make all of their flight offerings
available on each of the three GDSs, the suit says. They also
prohibit airlines from selling flights at lower costs through
their own distribution systems or through other channels. In
addition, airlines cannot levy surcharges on travel agents for
using a GDS rather than a less costly alternative.
The result of those contractual constraints, says that suit, is
that Amadeus, Travelport and Sabre, which together account for
more than 99% of the GDS market in the U.S., have been able to
charge "supracompetitive" fees that have led to higher ticket
prices for airline passengers.
"By requiring fares available through a GDS to be priced at
parity, regardless of the distribution channel, the contractual
restraint eliminates price competition among the defendants,
neutralizes the potential of lower-cost entrants and stems the
shift of booking to the airlines' own websites, thereby insulating
the GDS fees from competitive pressure," the complaint alleges.
The airlines were compelled to enter into such a contract, the
suit contends, because the GDS providers, faced with new threats
from airline websites and from start-up electronic-booking
companies, colluded to make sure that the airlines entered into
full-content agreements.
The GDSs used "cartel"-like tactics during negotiations for the
2006 contracts, according to the suit.
"Facing the specter of financial ruin from having their flights
'delisted' by the GDSs, the airlines ultimately acceded to
defendants' demands and executed the contracts," it says.
In an e-mail statement to Travel Weekly, Amadeus painted a very
different picture of the GDS' impact. The GDS, Amadeus said, has
ensured that travelers across the world have both the transparency
and the choices they demand.
"Global distribution systems have been instrumental in
facilitating an era of unprecedented mass air travel, delivering
value both to the airline industry and to the traveler," the
statement reads.
SAKUMA BROTHERS: Farmworkers Entitled to Rest Break Pay
-------------------------------------------------------
Gene Johnson, writing for The Associated Press, reports that
farmworkers who are paid by how much they pick are entitled to
separate, additional pay for their rest breaks, the Washington
Supreme Court said on July 16 in a unanimous opinion that could
have major implications for the state's agriculture industry -- as
well as other businesses where workers are paid by task rather
than by time.
But it's unclear whether the ruling will actually result in the
workers being paid more, or whether companies will simply
restructure the way they pay.
"Paid breaks for workers are a basic principle embodied in state
law, and this decision ensures that some agricultural workers, who
often perform difficult work for low pay, aren't denied this right
arbitrarily, based solely on their compensation method," said
Washington Attorney General Bob Ferguson, whose office supported
the pickers.
The decision came in a case involving Sakuma Brothers Farms, a
berry farm in Skagit County, north of Seattle. Some of the farm's
pickers -- seasonal, migrant workers, mainly from Mexico -- filed
a federal class-action lawsuit in 2013, saying they were entitled
to paid rest breaks under state law.
Sakuma Brothers agreed to pay the 900 workers and their lawyers
$850,000 to settle the claims of unpaid back wages for rest
breaks, but it denied further liability. The company said it
agrees that workers are entitled to paid rest breaks -- 10 minutes
every four hours -- --but it said the amount it paid the pickers
was inflated to already include compensation for rest breaks.
The federal court asked the state Supreme Court to weigh in, and
the justices said Sakuma's practice, which it has since abandoned,
wasn't good enough. Because workers were paid by how much they
pick, they could make more money by working through their rest
breaks, which can be bad for their health, Justice Mary Yu wrote
for the court.
"The current piece rate scheme encourages employees to 'work
harder' by skipping breaks," Justice Yu wrote. "That result . . .
effectively decreases the frequency of employees' rest periods; it
incentivizes Sakuma to employ fewer employees; and it fosters a
culture of working through rest breaks."
Some employment lawyers suggested the ruling could apply not just
to farmworkers, but others paid on a "piece-rate" basis, such as
janitors or hotel housekeepers paid by the floor or the room they
clean. A California appeals court made a similar ruling two years
ago in a case involving grocery store truck drivers paid by the
mile, rather than by the hour. That decision is being appealed.
The Washington justices also made clear that companies must pay
the workers the rate they make when they're picking, rather than
simply paying them the minimum wage during rest breaks.
Dan Ford, a lawyer with Columbia Legal Services who represents the
pickers, said there are an estimated 200,000 seasonal farmworkers
in Washington.
"Being paid for breaks is critical for the compensation
farmworkers should receive," he said. "If breaks are not properly
compensated, then workers are in the position of losing wages, or
losing breaks."
Ford said he expected some pickers might bring lawsuits similar to
the one Sakuma's employees brought, seeking additional pay for
past rest breaks.
In an e-mailed statement, Sakuma Brothers noted that it no longer
pays workers strictly by how much they pick. Instead, it's paying
$10 an hour plus a bonus of up to $30 per hour based on the number
of pounds picked. Under the system, the company's blackberry
pickers have been making more than $20 per hour on average, it
said.
"The decision by the Washington State Supreme Court confirms that
our current, active pay system goes above and beyond industry
standards and is one of the most progressive in the state, if not
the country," said Sakuma Chief Executive Danny Weeden said.
Jason Resnick, general counsel at the Irvine, California-based
Western Growers Association, said he expects other agricultural
companies in Washington to adopt similar pay structures.
"Agricultural employers who have been paying by piece-rate for
decades are now informed that they've been doing it wrong all
along," Mr. Resnick said. "This really changes the way
agricultural employers are going to pay their workers."
SANDHURST: Faces Investor Class Action Over Wickham Collapse
------------------------------------------------------------
Kristian Silva, writing for The Sydney Morning Herald, reports
that lawyers acting for about 150 retirees have launched a class
action to try and recover millions of dollars of savings lost by a
failed Queensland investment fund.
Wickham Securities went into liquidation in 2013, leaving its
investors about $27 million in the lurch.
The class action, filed by Shine Lawyers on behalf of lead
applicants Graeme and Marion Clarke on July 17, is against
Wickham's trustee company Sandhurst.
Mr and Mrs Clarke claim to have lost $220,000 of their savings.
Through Shine, the investors claim Sandhurst breached the
Corporations Act by not ensuring that Wickham could repay its
investors.
In Federal Court documents, it was alleged Wickham failed to
properly document its loans and did not maintain proper financial
records.
"Wickham did not have cash flow forecasts demonstrating it was
able to pay its debts as and when they fell due," Shine's
statement of claim read.
They also claimed Wickham used false documents to inflate its bank
balance by about $10.5 million.
Sandhurst Trustees has yet to respond to Shine's statement of
claim.
The matter is due to be heard in the Federal Court in Brisbane on
July 27.
Wickham Security's former director Brad Sherwin is serving a ban
issued by ASIC and has been charged with 33 counts of fraud.
Ex-chief executive Garth Robertson is also facing fraud charges.
SEAWORLD ENTERTAINMENT: To Defend Against "Baker" Lawsuit
---------------------------------------------------------
Seaworld Entertainment, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that the Company
intends to defend the securities class action lawsuit, Baker v.
SeaWorld Entertainment.
On September 9, 2014, a purported stockholder class action lawsuit
consisting of purchasers of the Company's common stock during the
periods between April 18, 2013 to August 13, 2014, captioned Baker
v. SeaWorld Entertainment, Inc., et al., Case No. 14-CV-02129-MMA
(KSC), was filed in the U.S. District Court for the Southern
District of California against the Company, the Chairman of the
Company's Board of Directors, certain of its executive officers
and Blackstone.
On February 27, 2015, Court-appointed Lead Plaintiffs,
Pensionskassen For Borne- Og Ungdomsp‘dagoger and Arkansas Public
Employees Retirement System, together with additional plaintiffs,
Oklahoma City Employee Retirement System and Pembroke Pines
Firefighters and Police Officers Pension Fund (collectively,
"Plaintiffs"), filed an amended complaint against the Company, the
Chairman of the Company's Board of Directors, certain of its
executive officers, Blackstone, and underwriters of the initial
public offering and secondary public offerings. The amended
complaint alleges, among other things, that the prospectus and
registration statements filed contained materially false and
misleading information in violation of the federal securities laws
and seeks unspecified compensatory damages and other relief.
Plaintiffs contend that Defendants knew or were reckless in not
knowing that Blackfish was impacting SeaWorld's business at the
time of each public statement.
The Company believes that the class action lawsuit is without
merit and intends to defend the lawsuit vigorously; however, there
can be no assurance regarding the ultimate outcome of this
lawsuit.
SEAWORLD ENTERTAINMENT: No Response Yet to "Hall" Suit
------------------------------------------------------
Seaworld Entertainment, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that the case, Holly
Hall v. SeaWorld Entertainment, Inc., is in the preliminary stages
and a response to the complaint has not yet been filed.
On March 25, 2015, a purported class action was filed in the
United States District Court for the Southern District of
California against the Company, captioned Holly Hall v. SeaWorld
Entertainment, Inc., Case No. 3:15-cv-00600-CAB-RBB (the "Hall
Matter"). The complaint identifies three putative classes
consisting of all consumers nationwide who at any time during the
four-year period preceding the filing of the original complaint,
purchased an admission ticket, a membership or a SeaWorld
"experience" that includes an "orca experience" from the SeaWorld
amusement park in San Diego, California, Orlando, Florida or San
Antonio, Texas respectively. The complaint alleges causes of
action under California Unfair Competition Law, California
Consumers Legal Remedies Act, California False Advertising Law,
Florida Unfair and Deceptive Trade Practices Act, Texas Deceptive
Trade Practices Act, as well as claims for Unjust Enrichment and
Deceit.
Plaintiffs' claims are based on their allegations that the Company
misrepresented the physical living conditions and care and
treatment of its killer whales, resulting in confusion or
misunderstanding among ticket purchasers, and omitted material
facts regarding its killer whales with intent to deceive and
mislead the plaintiff and purported class members. The complaint
further alleges that the specific misrepresentations heard and
relied upon by Holly Hall, the sole named plaintiff, in purchasing
her SeaWorld tickets concerned the circumstances surrounding the
death of a SeaWorld trainer. The complaint seeks actual damages,
equitable relief, attorney's fees and costs. Plaintiff claims that
the amount in controversy exceeds $5,000, but the liability
exposure is speculative until the size of the class is determined
(if certification is granted at all). The case is in the
preliminary stages and a response to the complaint has not yet
been filed.
SEAWORLD ENTERTAINMENT: Class Actions in Fla., Tex. Dismissed
-------------------------------------------------------------
Seaworld Entertainment, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that the class action
cases in Florida and Texas were voluntarily dismissed without
prejudice by the respective plaintiffs.
Three purported class actions were filed against the Company and
its affiliates in the following federal courts on April 9, 2015,
April 16, 2015 and April 17, 2015, respectively: (i) the United
States District Court for the Middle District of Florida,
captioned Joyce Kuhl v. SeaWorld LLC et al., 6:15-cv-00574-ACC-GJK
(M.D. Fla.), (ii) a second case in the United States District
Court for the Southern District of California, captioned Jessica
Gaab, et. al. v. SeaWorld Entertainment, Inc., Case No. 15:cv-842-
JAH-MDD and (iii) the United States District Court for the Western
District of Texas, captioned Elaine Salazar Browne v. SeaWorld of
Texas LLC et al., 5:15-cv-00301-XR (W.D. Tex.). These cases, in
essence, reiterate the claims made and relief sought in the Hall
Matter. The Company anticipates that the second case in the
Southern District of California will be consolidated with the Hall
Matter. On May 1, 2015, the cases in Florida and Texas were
voluntarily dismissed without prejudice by the respective
plaintiffs.
SEAWORLD ENTERTAINMENT: "Anderson" Action in Preliminary Stages
---------------------------------------------------------------
Seaworld Entertainment, Inc. said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015, that a purported class
action was filed on April 13, 2015, in the Superior Court of the
State of California for the City and County of San Francisco
against SeaWorld Parks and Entertainment, Inc., captioned Marc
Anderson, et. al., v. SeaWorld Parks and Entertainment, Inc., Case
No. CGC-15-545292. The putative class consists of all consumers
within California who, within the past four years, purchased
tickets to SeaWorld San Diego. The complaint alleges causes of
action under the California False Advertising Law and California
Unfair Competition Law. Plaintiffs' claims are based on their
allegations that the Company misrepresented the physical living
conditions and care and treatment of its killer whales, resulting
in confusion or misunderstanding among ticket purchasers, and
omitted material facts regarding its killer whales with intent to
deceive and mislead the plaintiff and purported class members. The
complaint seeks actual damages and equitable relief. Based on
Plaintiff's definition of the class, the amount in controversy
exceeds $5,000, but the liability exposure is speculative until
the size of the class is determined (if certification is granted
at all). The case is in the preliminary stages and a response to
the complaint has not yet been filed.
SPECTRUM PHARMACEUTICALS: Replies to Motion for Reconsideration
---------------------------------------------------------------
Spectrum Pharmaceuticals, Inc. has filed its reply in support of
its motion for reconsideration in the shareholder litigation, John
Perry v. Spectrum Pharmaceuticals, Inc. et al. (Filed March 14,
2013 in United States District Court, District of Nevada; Case
Number 2:2013-cv-00433-LDG-CWH), the Company said in its Form 10-Q
Report filed with the Securities and Exchange Commission on May 8,
2015, for the quarterly period ended March 31, 2015.
This putative consolidated class action raises substantially
identical claims and allegations against defendants Spectrum
Pharmaceuticals, Inc., Dr. Rajesh C. Shrotriya, Brett L. Scott,
and Joseph Kenneth Keller. The alleged class period is August 8,
2012 to March 12, 2013. The lawsuits allege a violation of Section
10(b) of the Securities Exchange Act of 1934 against all
defendants and control person liability, as a violation of Section
20(b) of the Securities Exchange Act of 1934, against the
individual defendants. The claims purportedly stem from the
Company's March 12, 2013 press release, in which it announced that
it anticipated a change in ordering patterns of FUSILEV. The
complaints allege that, as a result of the March 12, 2013 press
release, the Company's stock price declined. The complaints
further allege that during the putative class period certain
defendants made misleadingly optimistic statements about FUSILEV
sales, which inflated the trading price of Company stock. The
lawsuits seek relief in the form of monetary damages, costs and
fees, and any other equitable or injunctive relief that the court
deems appropriate.
On March 21, 2014, the Court entered an order appointing Arkansas
Teacher Retirement System as lead plaintiff. On May 20, 2014,
Arkansas Teacher Retirement System filed a consolidated amended
class action complaint.
"On July 18, 2014, we filed a motion to dismiss the consolidated
amended class action complaint," the Company said. "On March 26,
2015, the court denied the motion to dismiss. On April 10, 2015,
we filed a motion for reconsideration of such decision. On April
24, 2015, Arkansas Teacher Retirement System filed its opposition
to such motion. On May 1, 2015, we filed our reply in support of
our motion for reconsideration of our motion for reconsideration."
TAYLOR ENERGY: Judge Refuses to Dismiss Oil Leak Case
-----------------------------------------------------
Michael Kunzelman, writing for The Associated Press, reports that
a federal judge has refused to dismiss a lawsuit that
environmental groups filed against a New Orleans-based company
responsible for a decade-old oil leak in the Gulf of Mexico.
U.S. District Judge Susie Morgan ruled on July 7 that a trial is
necessary to determine whether several plaintiffs led by the
New York-based Waterkeeper Alliance have a right to sue Taylor
Energy Company.
The company claims federal regulators agree nothing more can be
done to stop the leak off Louisiana's coast. But Judge Morgan
concluded there is a "genuine factual dispute" over whether Taylor
can and should do more to mitigate its impacts.
Since 2004, oil has been leaking at the site where a Taylor-owned
platform toppled during Hurricane Ivan. Authorities estimate the
leak could last a century or more if left unchecked.
TCP INTERNATIONAL: To Seek Consolidation of Class Actions
---------------------------------------------------------
TCP International Holdings Ltd. plans to seek consolidation of the
securities class action complaints filed in the Northern District
of Ohio and the Southern District of New York, the Company said in
its Form 10-Q Report filed with the Securities and Exchange
Commission on May 8, 2015, for the quarterly period ended March
31, 2015.
On February 26, 2015, Laura Hauser filed a complaint in the Court
of Common Pleas of Cuyahoga County, Ohio, against the Company, its
wholly-owned subsidiary Technical Consumer Products, Inc., and
Ellis Yan, alleging that Mr. Yan mistreated Ms. Hauser in
connection with her employment as the General Counsel and
Secretary of the Company. In addition to asserting a number of
tort claims against Mr. Yan, Ms. Hauser asserted a claim against
the Company for respondeat superior. Ms. Hauser has not formally
specified the alleged damages she is seeking for this matter. The
Company believes Ms. Hauser's claim against the Company is without
merit and intends to vigorously defend itself. As this litigation
is in the early onset of discovery, the Company is unable to
determine the probability and amount of loss, if any, related to
this litigation.
On February 26, 2015, Ms. Hauser also filed a complaint with the
U.S. Department of Labor-OSHA alleging that the Company committed
retaliatory employment practices in violation of the whistleblower
provisions of the Sarbanes-Oxley Act and the Consumer Product
Safety Act (Laura Hauser v. TCP International Holdings Ltd. et
al). Ms. Hauser filed an amended complaint on March 16, 2015,
against the Company and Mr. Yan asserting that the parties reduced
Ms. Hauser's responsibilities and placed her on administrative
leave in part due to alleged protected activities. On March 16,
2015, OSHA initiated an investigation regarding Ms. Hauser's
claims. The Company believes Ms. Hauser's claims lack merit and
will fully cooperate with OSHA's investigation.
Following press reports of the Hauser litigation filed in Cuyahoga
County, Ohio, putative shareholders filed two securities class
action complaints in the United States District Court for the
Northern District of Ohio, a securities class action complaint in
the United States District Court for the Southern District of New
York and a securities class action complaint in the Court of
Common Pleas of Cuyahoga County, Ohio. The putative shareholders
assert a number of alleged securities violations against the
Company, certain current and former officers and directors of the
Company, and the underwriters of the Company's IPO, including
violations of Sections 11, 12(a)(2), and 15 of the Securities Act
of 1933, and violations of Section 10(b) and 20(a) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated
thereunder. The claims generally involve alleged material
misstatements and omissions in connection with the IPO prospectus
and registration statement and seek an unspecified amount of
damages. The Company plans to seek consolidation of the securities
class action complaints filed in the Northern District of Ohio and
the Southern District of New York. The Company believes these
claims lack merit and intends to vigorously defend itself. As this
litigation is in the early onset of discovery, the Company is
unable to determine the probability and amount of loss, if any,
related to this litigation
TEXTURA CORPORATION: Filed Motion to Dismiss Class Action
---------------------------------------------------------
Textura Corporation has filed a motion to dismiss a putative class
action lawsuit, the Company said in its Form 10-Q Report filed
with the Securities and Exchange Commission on May 8, 2015, for
the quarterly period ended March 31, 2015.
On October 7, 2014, a putative class action lawsuit alleging
violations of federal securities laws was filed in the U.S.
District Court for the Northern District of Illinois, naming as
defendants the Company and certain of its executive officers. An
amended complaint was filed on February 17, 2015. The amended
complaint alleges violations of the Securities Exchange Act of
1934 by the Company and its executive officers for making
allegedly materially false and misleading statements and by
failing to disclose allegedly material facts regarding its
business and operations between June 7, 2013 and September 29,
2014. The plaintiffs seek unspecified monetary damages and other
relief.
"We believe the lawsuit is without merit and intend to defend the
case vigorously. We filed a motion to dismiss on May 4, 2015," the
Company said.
TIME WARNER: Woman Gets $230,000 Award in Robocall Case
-------------------------------------------------------
Larry Neumeister, writing for The Associated Press, reports that
it wasn't a robocall, but a federal judge left a message anyway
for companies on July 7 when he awarded nearly $230,000 to a Texas
woman, finding that a cable company crossed the line when it
harassed her with 153 robocalls even after she complained about
the wrong numbers.
U.S. District Judge Alvin Hellerstein in Manhattan ordered Time
Warner Cable Inc. to make the $229,500 payment to Araceli King of
Irving, Texas, citing the New York-based company's "particularly
egregious" behavior as it violated the Telephone Consumer
Protection Act of 1991.
Ms. King sued last year, saying she had repeatedly asked the
company to stop making the calls.
Susan Leepson, a Time Warner spokeswoman, said the company is
reviewing its options and determining how to proceed.
Judge Hellerstein said he tripled the $1,500 penalty for each call
because Time Warner's actions were "particularly egregious" since
it continued making the calls even after King complained in a
seven-minute phone conversation in October 2013 with a company
representative that the calls to her phone were apparently meant
for a customer she did not know. The judge noted that 74 of the
calls were made after Time Warner received a copy of Ms. King's
lawsuit in March 2014.
The company's "recurring theme" in its legal arguments was that it
was an unwitting victim of an unpredictable federal law that was
not intended to turn an innocuous call to a wrong number into
large damages, the judge said.
"The responsible company will reduce its exposure dramatically by
taking proactive steps to mitigate damages, while its competitor,
who unthinkingly robo-dials the same person hundreds of time over
many months without pausing to wonder why it cannot reach him,
cannot complain about much higher liability," the judge wrote.
Ms. King's lawyer, Sergei Lemberg, said his client is delighted.
He said the decision sends a message to consumers to "stop taking
it on the chin" when robocalls don't stop and a message to
companies that it's necessary to pay attention to human beings,
even when technology is used to make repeated calls.
"Millions of U.S. consumers get robocalls. Only a few of them
take it a step forward and get a lawyer," the Stamford,
Connecticut, attorney said.
UBER TECHNOLOGIES: Must Face Cab Companies' False Ad Suit
---------------------------------------------------------
The Associated Press, citing The San Francisco Chronicle, reports
that a federal judge has ruled California taxicab companies can
sue competitor Uber over advertising statements that it offers the
safest rides on the road.
According to The San Francisco Chronicle, taxicab companies
accused the ride-hailing company of false advertising for stating
in ads and online postings that its background checks were the
most thorough and its services the safest in the business. The
statements implied, and sometimes explicitly declared, that
conventional taxis were less safe.
Taxi companies say their review of prospective drivers is far more
thorough. They say they use fingerprint checks and government
criminal records that Uber does not employ and require their
drivers to take a driver safety course and a written exam.
U.S. District Judge Jon Tigar of San Francisco rejected Uber's
attempt to dismiss the suit on July 17 and said much of it could
proceed.
UBER TECHNOLOGIES: Continues to Face Legal Challenges Abroad
------------------------------------------------------------
Juliana Kenny, writing for Legaltech News, reports that Uber
continues to face legal challenges abroad -- something the ride-
sharing company has done since its outset, but with recent
pushback from France and Mexico.
In France, the San Francisco-based company has conceded to suspend
its service as tension between it, France's taxi drivers, and the
government came to a head. Two of its senior European managers
were detained on July 6 and ordered to stand trial, charged with
"deceptive commercial practices," according to the Associated
Press.
Mexico's Office of Legal and Legislative Studies said in an
announcement the government is proposing regulations that will
require drivers and cars to be registered, and also require Uber
to pay into a fund for transportation infrastructure.
These are not the first battles of their kind for Uber in either
country; the company has been pushing against commercial and legal
resistance in France since it launched there in 2011. Taxi
drivers in Mexico routinely protest against Uber and petition the
government for a ban on the company, citing it's skirting of
licensing fees and inspections. In both cases, this is yet
another go-around for Uber as it navigates the landscape of legal
challenges that disruptive technology startups are woefully prone
to facing both at home and abroad.
Tricia Meyer, founder and managing attorney for Meyer Law, Ltd.
commented on Uber's issue in France when reached by Legaltech
News. She said that it is important to keep in mind with the
creation of new tech-based services that new legal risks are
introduced.
"What's challenging for Uber and other similar tech-based services
is that they are seeking to be competitive by taking advantage of
legal gaps in existing markets that are highly regulated,"
Ms. Meyer noted. "When new technologies are created that disrupt
regulated industries, those within such industries will do
everything in their power to ban them. It is important to
understand the differences between domestic and foreign business
and the risks you potentially face including the multitude of
varying laws so that you are able to balance the legal risks with
the market demand."
It is this disruption that is key to Uber's problems here, and a
challenge it has faced around the world. Uber is not the only
startup to face resistance from foreign governments and commercial
industries, and is not the only ride-sharing app to, either.
Speaking to Legaltech News, Fred Wilf, founder and managing
partner of firm Wilftek, LLC, said that Uber needs to mediate
local laws and regulations, as well as local attitudes and
business ecosystems, wherever its operations launch, regardless of
whether or not it is in its native country or abroad, and that its
disruptive nature in multiple industries is what it has been
coming to terms with through these legal battles.
"What Uber and other businesses like it have discovered is the
depth of resistance to disruption. Uber is disrupting laws and
regulations, business plans, entrenched attitudes and taxi
drivers' expectations of the how they will earn their
livelihoods," said Mr. Wilf. "Sometimes the disruption is
pushback from people in older businesses who want to disrupt Uber
and other new business models before the new business models can
gain traction."
And the models are changing all the time for regulating new
businesses in technology as, historically, governments are so slow
to develop policy for burgeoning tech, the tech itself becomes
commonplace before they can get around to regulating it. As
Mr. Wilf pointed out, times have changed since the dawn of the
Web: "Nearly 20 years ago, John Perry Barlow issued his
Declaration of the Independence of Cyberspace, which essentially
declares that cyberspace is independent of local, state, national
and international laws, regulations and authorities. Of course,
since then, entrepreneurs and technologists have had to deal with
more than just laws and regulations developed prior to [when] the
Internet was commercialized."
Indeed, regulations around cyberactivity are constantly evolving.
Understanding the changing landscape seems to be requisite for new
tech companies. Ms. Meyer noted that -- while not all U.S.-based
startups will face the same issues as Uber in France, its
challenges might be poised as a cautionary tale for other tech
companies that are operating in highly regulated markets.
"Tech-based companies must understand whether their service will
change how things currently work or will work within the already
existing regulations of any foreign market," she said.
"Technology companies are continually evolving and should dedicate
significant resources to ensure compliance with any foreign law
and mitigate unnecessary risk."
UNITED STATES: NSA Data Collection Unconstitutional, Groups Claim
-----------------------------------------------------------------
Mark Hamblett, writing for Law.com, reports that civil liberties
groups have asked the U.S. Court of Appeals for the Second Circuit
to declare again that the bulk collection of telephone metadata by
the National Security Agency is not authorized by statute and is
unconstitutional.
Saying the government has resumed the illegal collection of the
data in its anti-terrorism efforts, the American Civil Liberties
Union and the New York Civil Liberties Union are seeking a
preliminary injunction against the collection or use of the phone
records of their organizations.
They claim the government has continued the bulk collection
without Congress' authorization and despite a circuit ruling in
May that Sec. 215 of the Patriot Act does not allow for the
collection.
But Judges Gerard Lynch and Robert Sack and Southern District
Judge Vernon Broderick declined to issue an injunction because the
section was to expire on June 1 and Congress was debating what
form the Patriot Act would take (NYLJ, May 8).
The ACLU and the NYCLU told the circuit that Congress declined to
expand the government's surveillance authority, and yet the NSA
continues "to collect Americans' call records in bulk on the
purported authority of precisely the same statutory language this
court has already concluded does not permit it."
The USA Freedom Act of 2015, signed into law by President Barack
Obama on June 2, provides that the government can collect call
records after 180 days if it meets certain "additional
requirements" including "particularized suspicion" and "targeted
demands."
But during that 180-day period, the lawyers asserted, the same
provision "that the government unlawfully invoked to justify the
collection of call records in bulk for more than seven years"
stayed in place, the NYCLU wrote.
Also on June 2, it said the government asked the Foreign
Intelligence Surveillance Court to resurrect the call records
program.
UNIVERSITY OF NORTH CAROLINA: Wants Student-Admission Suits Stayed
------------------------------------------------------------------
Marcia Coyle, writing for The National Law Journal, reports that
Harvard University and the University of North Carolina have asked
two federal district courts to delay litigation charging them with
illegal race-based admissions policies until the U.S. Supreme
Court rules next term in a similar case.
Lawyers for the universities on July 6 filed motions to halt the
proceedings because, they argued, the "primary issue" before the
high court in Fisher v. University of Texas at Austin is at the
"epicenter" of the lawsuits filed against them by Students for
Fair Admissions.
In Fisher, the justices will examine for the second time whether
the University of Texas' use of race as a factor in its
undergraduate admissions policy violates the equal-protection
clause and the high court's precedents. In 2013, a 7-1 majority
sent the case back to the U.S. Court of Appeals for the Fifth
Circuit to apply strict scrutiny to the policy -- whether the
policy was justified by a compelling interest and was narrowly
tailored to achieve that interest.
In its decision, the majority said strict scrutiny "imposes on the
university the ultimate burden of demonstrating, before turning to
racial classifications, that available, workable race-neutral
alternatives do not suffice." The Fifth Circuit upheld the
admissions policy for a second time, and the Supreme Court on June
29 granted review in "Fisher II."
"The petitioner in Fisher II, represented by the same counsel as
plaintiff in this case, Students For Fair Admissions Inc., is
raising before the Supreme Court issues that bear directly on this
case," Harvard's counsel, Seth Waxman of Wilmer Cutler Pickering
Hale and Dorr, wrote in the motion in Students for Fair Admissions
v. President and Fellows of Harvard College.
Both university lawsuits, filed in November, are in the early
stages of discovery.
"Staying proceedings in this case pending the Supreme Court's
decision in Fisher II will promote efficient judicial
administration and defer the immense burdens of discovery in this
case until the Supreme Court clarifies the applicable legal
framework and standards and provides material guidance regarding
the law in this area that will shape the analysis of this case
before the court," Mr. Waxman said.
And, if the Supreme Court "in any way alters the legal standards
governing the use of race in university admissions," the
University of North Carolina would have to review and evaluate its
admissions process "to determine whether it comports with those
new standards," UNC's counsel, Michael Scudder of Skadden, Arps,
Slate, Meagher & Flom, wrote in court papers in Students for Fair
Admissions v. University of North Carolina.
"If the university, as a result of that determination, modifies or
refines its existing policies, the discovery plaintiff seeks
relating to the university's current policies and practices may be
largely irrelevant or, at the very least, incomplete," he argued.
Edward Blum, director of the Project on Fair Representation, which
seeks to eliminate racial and ethnic preferences, created and is
president of Students for Fair Admissions. He recruited
plaintiffs in the two lawsuits and hired the lawyers. He is
funding the cases as he continues to do in the Fisher litigation.
"Students for Fair Admissions believes it is imperative that these
lawsuits remain on the timetable all parties agreed to a few weeks
ago," Mr. Blum told the NLJ on July 7. "Thousands of applicants
to UNC and Harvard during the next few months will be subjected to
a racially discriminatory admissions system. The judges hearing
both cases must not let discovery be sidetracked and subject
thousands of high school applicants to an unfair process."
The Harvard lawsuit charges that the university discriminates by
strictly limiting the number of Asian-Americans that it will admit
each year and by engaging in impermissible racial balancing. The
UNC-Chapel Hill complaint accuses the university of failing, like
Harvard, to comply with the strict-scrutiny test mandated by the
Supreme Court in its 2013 Fisher decision. Both are charged with
violating the 14th Amendment and federal civil rights laws.
VCA INC: To Defend Against Remaining Claims in "Duran" Case
-----------------------------------------------------------
VCA Inc. intends to continue to vigorously defend against the
remaining claims in the case, Jorge Duran vs. VCA Animal
Hospitals, Inc., et. al., the Company said in its Form 10-Q Report
filed with the Securities and Exchange Commission on May 8, 2015,
for the quarterly period ended March 31, 2015.
"On May 29, 2013, a former veterinary assistant at one of our
animal hospitals filed a purported class action lawsuit against us
in the Superior Court of the State of California for the County of
Los Angeles, titled Jorge Duran vs. VCA Animal Hospitals, Inc.,
et. al.," the Company said. "The lawsuit seeks to assert claims
on behalf of current and former veterinary assistants employed by
us in California, and alleges, among other allegations, that we
improperly failed to pay regular and overtime wages, improperly
failed to provide proper meal and rest periods, and engaged in
unfair business practices. The lawsuit seeks damages, statutory
penalties, and other relief, including attorneys' fees and costs.
On May 7, 2014, we obtained partial summary judgment, dismissing
four of the eight claims of the complaint, including the claims
for failure to pay regular and overtime wages. We intend to
continue to vigorously defend against the remaining claims in this
action. At this time, we are unable to estimate the reasonably
possible loss or range of possible loss, but do not believe
losses, if any, would have a material effect on our results of
operations or financial position taken as a whole."
VCA INC: Court Stayed "La Kimba Bradsbery" Lawsuit
--------------------------------------------------
VCA Inc. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that the court has issued an order staying
the La Kimba Bradsbery lawsuit until class certification is
completed in the Duran case.
On July 16, 2014, two former veterinary assistants filed a
purported class action lawsuit against the Company in the Superior
Court of the State of California for the County of Los Angeles,
titled La Kimba Bradsbery and Cheri Brakensiek vs. Vicar
Operating, Inc., et. al.
"The lawsuit seeks to assert claims on behalf of current and
former veterinary assistants, kennel assistants, and client
service representatives employed by us in California, and alleges,
among other allegations, that we improperly failed to pay regular
and overtime wages, improperly failed to provide proper meal and
rest periods, improperly failed to pay reporting time pay,
improperly failed to reimburse for certain business-related
expenses, and engaged in unfair business practices," the Company
said. "The lawsuit seeks damages, statutory penalties, and other
relief, including attorneys' fees and costs. We currently expect
that these two actions will be consolidated with, or related
before the same judge hearing, the Duran action."
In September 2014, the court issued an order staying the La Kimba
Bradsbery lawsuit until class certification is completed in the
Duran case. Plaintiff Duran filed his class certification motion
and supporting documentation in January 2015. A class
certification hearing was scheduled for June 2, 2015.
"At this time, we are unable to estimate the reasonably possible
loss or range of possible loss, but do not believe losses, if any,
would have a material effect on our results of operations or
financial position taken as a whole," the Company said.
VCA INC: "Lopez" Case Settlement Awaits Court Approval
------------------------------------------------------
The proposed settlement in the case, Carlos Lopez vs. Logistics
Delivery Solutions, LLC, Antech Diagnostics, Inc., et. al.,
remains subject to court approval and class notice administration
before it will be effective, VCA Inc. said in its Form 10-Q Report
filed with the Securities and Exchange Commission on May 8, 2015,
for the quarterly period ended March 31, 2015.
"On July 12, 2013, an individual who provided courier services
with respect to our laboratory clients in California filed a
purported class action lawsuit against us in the Superior Court of
the State of California for the County of Santa Clara - San Jose
Branch, titled Carlos Lopez vs. Logistics Delivery Solutions, LLC,
Antech Diagnostics, Inc., et. al.," the Company said.
Logistics Delivery Solutions, LLC, a co-defendant in the lawsuit,
is a company with which Antech has contracted to provide courier
services in California. The lawsuit seeks to assert claims on
behalf of individuals who were engaged by Logistics Delivery
Solutions, LLC to perform such courier services and alleges, among
other allegations, that Logistics Delivery Solutions and Antech
Diagnostics improperly classified the plaintiffs as independent
contractors, improperly failed to pay overtime wages, and
improperly failed to provide proper meal periods. The lawsuit
seeks damages, statutory penalties, and other relief, including
attorneys' fees and costs.
"We filed our answer to the complaint on September 13, 2013," the
Company said. "On July 18, 2014, we filed a motion for summary
judgment, and on October 3, 2014 the court denied our request for
summary judgment."
"Although we believed this lawsuit was without merit and have
vigorously defended against the claims, the parties engaged in
mediation on December 18, 2014. As a result of the mediation, the
parties reached an agreement in principle to settle the action, on
a class-wide basis, for an amount not to exceed $1,250,000.
Logistics Delivery Solutions, LLC, has agreed to pay half of the
claim.
"Accordingly, as of December 31, 2014, we have accrued the
remaining fifty percent. The proposed settlement, when and if it
becomes effective, would not be an admission of wrongdoing or
acceptance of fault by any of the defendants named in the
complaint. Antech Diagnostics and Logistics Delivery Solutions
have agreed upon the terms of this proposed settlement to
eliminate the uncertainties, risk, distraction and expense
associated with protracted litigation. The proposed settlement
remains subject to court approval and class notice administration
before it will be effective."
VCA INC: "Graham" Class Action in Early Procedural Stage
--------------------------------------------------------
VCA Inc. said in its Form 10-Q Report filed with the Securities
and Exchange Commission on May 8, 2015, for the quarterly period
ended March 31, 2015, that the case, Tony M. Graham vs. VCA
Antech, Inc. and VCA Animal Hospitals, Inc., is in an early
procedural stage.
"On May 12, 2014, an individual client who purchased goods and
services from one of our animal hospitals filed a purported class
action lawsuit against us in the United States District Court for
the Northern District of California, titled Tony M. Graham vs. VCA
Antech, Inc. and VCA Animal Hospitals, Inc.," the Company said.
"The lawsuit seeks to assert claims on behalf of the plaintiff and
other individuals who purchased similar goods and services from
our animal hospitals and alleges, among other allegations, that we
improperly charged such individuals for "biohazard waste
management" in connection with the services performed. The lawsuit
seeks compensatory and punitive damages in unspecified amounts,
and other relief, including attorneys' fees and costs. VCA
successfully had the venue transferred to the Southern District of
California. This case is in an early procedural stage and we
intend to vigorously defend this action. At this time, we are
unable to estimate the reasonably possible loss or range of
possible loss, but do not believe losses, if any, would have a
material effect on our results of operations or financial position
taken as a whole."
VICAL INCORPORATED: Lawsuit Over Allovectin(R) Dismissed
--------------------------------------------------------
Vical Incorporated said in its Form 10-Q Report filed with the
Securities and Exchange Commission on May 8, 2015, for the
quarterly period ended March 31, 2015, that the Court has entered
final judgment dismissing a class action complaint related to
Allovectin(R).
In late October and early November 2013, following the Company's
announcement of the results of its Phase 3 trial of Allovectin(R)
and the subsequent decline of the price of its common stock, two
putative securities class action complaints were filed in the U.S.
District Court for the Southern District of California against the
Company and certain of its current and former officers.
On February 26, 2014, the two cases were consolidated into one
action and a lead plaintiff and lead counsel were appointed. On
May 12, 2014, the lead plaintiff filed a first amended
consolidated complaint alleging that the defendants violated
Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 by
making materially false and misleading statements regarding the
Company's business prospects and the prospects for Allovectin(R),
thereby artificially inflating the price of the Company's common
stock. On June 9, 2014, defendants filed a motion to dismiss the
first amended complaint and a motion to strike certain allegations
in the amended complaint.
On March 9, 2015, the Court granted defendants' motion to dismiss
the first amended complaint and terminated as moot defendants'
motion to strike. Lead plaintiff was granted leave to amend his
first amended complaint on or before March 25, 2015. Lead
plaintiff chose not to amend his complaint and instead stipulated
to an entry of judgment. On April 28, 2015, the Court entered
final judgment dismissing the action.
WAL-MART: Faces Class Action Over Same-Sex Discrimination
---------------------------------------------------------
Collin Binkley, writing for The Associated Press, reports that a
Massachusetts woman filed a class-action lawsuit on July 14
accusing Wal-Mart of wrongly denying employee benefits for same-
sex spouses.
Jacqueline Cote says Wal-Mart repeatedly denied medical insurance
for her wife before 2014, when the retail giant started offering
benefits for same-sex spouses.
The couple incurred at least $150,000 in medical costs after
Cote's wife, Dee Smithson, was diagnosed with ovarian cancer in
2012.
The lawsuit filed in U.S. District Court in Boston seeks damages
for the couple and for any other Wal-Mart employees who weren't
offered insurance for their same-sex spouses. It asks for money
to cover out-of-pocket medical costs and for other punitive
damages.
Ms. Cote said in a call with reporters that the financial stress
worsened Ms. Smithson's suffering through cancer treatments.
"I'm following through with this for my wife and actually for
anyone else who has suffered a similar injustice," Ms. Cote said.
Wal-Mart issued a statement on July 14 noting it expanded benefits
last year to include same-sex spouses and domestic partners. "We
have not yet seen the details of the lawsuit and out of respect
for Ms. Cote we are not going to comment other than to say our
benefits coverage previous to the 2014 update was consistent with
the law," the Bentonville, Arkansas, company said.
Ms. Cote, of New Bedford, previously took her case to the U.S.
Equal Employment Opportunity Commission, which decided in January
that Wal-Mart's denial amounted to discrimination and ordered the
company to provide a "just resolution" for violating Cote's civil
rights.
WIDENER UNIVERSITY: Class Certif. Denied in Law Jobs Stats Suit
---------------------------------------------------------------
Charles Toutant, writing for New Jersey Law Journal, reports that
a federal judge in Newark has denied class certification in a suit
brought on behalf of graduates of Widener University School of Law
who claimed the school's marketing materials overstated their
postgraduate job prospects.
U.S. District Judge William Walls of the District of New Jersey
ruled that the case met the ascertainability, numerosity and
commonality requirements that are required for class
certification. But the case failed to meet the predominance and
typicality requirements, Judge Walls said, and therefore is not
entitled to certification.
Judge Walls said the suit's theory that all graduates suffered
corresponding damages ignores the reality that some obtained the
type of full-time legal jobs they sought when enrolling at
Widener, while other class members may have suffered ascertainable
losses as a result of the school's alleged misrepresentation about
their future job prospects. As such, individual questions
predominate over common questions about the loss each proposed
class member sustained, Judge Walls said.
The typicality requirement is not met because it is not clear
whether all members of the proposed class were exposed to the
misrepresentations claimed by the plaintiffs' counsel, Judge Walls
said.
The suit was brought in 2012 by six Widener alumni who graduated
between 2008 and 2011 and worked in jobs such as bartender and
retail salesperson after failing to find legal jobs. The suit
claimed the school violated the consumer fraud acts of New Jersey
and Delaware. The suit claimed that Widener, with campuses in
Harrisburg, Pennsylvania, and Wilmington, Delaware, routinely
reported that 90 to 95 percent of graduates found work within nine
months of graduation, without distinguishing between legal jobs
and ones not requiring a law degree. The suit also claimed
Widener misrepresented graduates' mean salaries, failing to
disclose that the figures provided represent a small and
deliberately selected subset of graduates.
Similar suits filed in 2011 and 2012 against Albany Law School,
New York Law School, Hofstra and Brooklyn Law School in New York
and Thomas Cooley Law School and Southwestern Law School in Los
Angeles were dismissed.
Plaintiffs lawyer David Stone -- DStone@stonemagnalaw.com -- of
Stone & Magnanini in Berkeley Heights said he is "studying the
decision to determine what action we will take." Defense lawyer
Dennis Drasco of Lum, Drasco & Positan in Roseland did not return
a call about the case. Widener was also represented by
Louis Isaacsohn -- louis.isaacsohn@wilsonelser.com -- of Wilson,
Elser, Moskowitz, Edelman & Dicker in Philadelphia, and Thomas
Quinn and Suna Lee of the firm's Florham Park office, who declined
to comment.
XL FOODS: Settlement Agreement Reached in Beef Recall Class Action
-----------------------------------------------------------------
Bill Graveland, writing for The Canadian Press, reports that a
deal has been worked out in a class-action lawsuit filed over an
E. coli outbreak and the largest meat recall in Canadian history.
The lawsuit is against XL Foods Inc., which operated a meat-
packing plant in southern Alberta during a tainted beef recall in
2012.
"We've reached an agreement on the class action subject to court
approval," Calgary lawyer Clint Docken, who is representing a
handful of clients, said on July 16.
Compensation has been set at C$4 million, said Mr. Docken, and a
hearing is to be held this fall to formally approve the deal.
XL Foods recalled more than 1.8 million kilograms of beef in
Canada and the United States in 2012.
The plant in Brooks was sold to JBS Canada in 2013.
In October 2012, Brian Nilsson, one of the chief executives of XL
Foods, apologized to people who became ill and was quoted in the
media as saying that the company took full responsibility.
"It was hard fought definitely, but in terms of the process I
think the matter has moved along. We've had a very proactive case
management judge and that has been helpful," said Mr. Docken.
The settlement has a number of components, the lawyer explained.
There is to be compensation for provincial health providers to
cover their costs in dealing with injuries associated with the
tainted meat. There is also money available for consumers who
were forced to throw away meat after the extensive recall.
But the majority of the settlement is to go to those who became
ill after eating the meat.
"People who suffered injury, particularly E. coli poisoning, as a
result of consuming the meat are also potentially subject to a
settlement as well," Mr. Docken said.
"There were some that suffered very serious illnesses and ended up
with extensive hospitalization."
Mr. Docken said the actual number of claimants won't be known
until the fall, but he noted that the majority are in Alberta and
Ontario. Some in the United States.
Payments could range from hundreds to tens of thousands of
dollars, he said.
XOOM CORP: Faces Shareholder Suit Over Pending Paypal Acquisition
-----------------------------------------------------------------
Marisa Kendall, writing for Law.com, reports that Xoom Corp.
shareholders are suing the company over its pending $890 million
acquisition by PayPal Inc., claiming it undervalues the company's
stock.
Plaintiffs lawyers with Green & Noblin and Cullin O'Brien Law
object to provisions that prevent Xoom from soliciting higher
bids, and give PayPal the right to top any potential bid. The
lawyers sued Xoom, members of Xoom's board of directors and PayPal
in San Francisco Superior Court on July 6, five days after the
sale was announced.
"The takeover of Xoom, if consummated, will likely result on the
company's shareholders losing their equity stake in the company at
below the company's true value," the complaint states.
In a statement announcing the deal, PayPal's president said Xoom,
which facilitates overseas digital money transfers, would help
PayPal expand into the international market.
"Acquiring Xoom allows PayPal to offer a broader range of services
to our global customer base," Dan Schulman wrote.
Xoom's president and CEO, John Kunze, wrote that being acquired by
a larger, global organization represents an "exciting new chapter
for Xoom."
Representatives from PayPal and Xoom did not immediately respond
to requests for comment on July 8.
The deal, which is expected to close in the fourth quarter of this
year, represents a payout for Xoom shareholders of $25 per share.
The defendants touted that figure as a premium of 32 percent over
Xoom's three-month average stock price.
But the plaintiffs lawyers claim Xoom's 52-week high was $26.86
per share. Xoom's business model is sound, according to the
complaint, and "all indications are that Xoom will continue to
reap astronomical profits." The lawyers cited a Reuters report
that said Xoom's revenues increased 24 percent during the first
three months of 2015, topping $44 million.
The lawyers also claim Xoom's directors are selling to avoid
liability for $35 million stolen from the company by hackers.
Sidley Austin is advising PayPal in the acquisition, and Goodwin
Procter is advising Xoom.
More litigation may follow. Earlier this month lawyers with
San Diego plaintiffs firm Robbins Arroyo announced they are
investigating the deal and put out a call for plaintiffs.
Such lawsuits have become the almost inevitable result of any
high-dollar deal. More than 94 percent of mergers and
acquisitions valued at more than $100 million in 2013 triggered
shareholder litigation, according to a report from Cornerstone
Research.
XTO ENERGY: Faces Class Action Over Gas Royalty Payments
--------------------------------------------------------
Angela Neville, writing for Texas Lawyer, reports that a group of
natural gas royalty owners in Western Pennsylvania are fighting
mad and accusing Texas-based XTO Energy, Exxon Mobil Corporation's
subsidiary, of messing around with their royalty payments. The
group recently filed a class action lawsuit against XTO Energy
alleging royalty skimming and seeking reimbursement for royalties
they claim were incorrectly withheld because of XTO Energy's
improper deductions of postproduction expenses.
David A. Borkovic -- dab@jgcg.com -- who is of counsel with the
Pittsburgh-based office of Jones, Gregg, Creehan & Gerace, is
representing the plaintiffs in the class action. The case,
Marburger v. XTO Energy, was filed in the U.S. District Court for
the Western District of Pennsylvania.
In the class action complaint, the plaintiffs discuss the
background concerning the oil and gas leases now held by XTO
Energy. Originally, Phillips Production Company and its
affiliates drafted and prepared a standard-form oil and gas lease
that they used to acquire oil and gas rights in Western
Pennsylvania. Under the terms of their standard form lease,
royalties were to be calculated without deducting any
postproduction expenses.
According to the complaint, Phillips Production "understood the
lease," and paid royalties to landowners without deducting
postproduction expenses. In 2011, however, Exxon Mobil acquired
Phillips Production and its affiliates, and the standard-form
Western Pennsylvania leases were assigned to or placed under the
control of XTO Energy. The plaintiffs assert that XTO Energy then
disregarded both the language of the leases and the Phillips
companies' understanding and course of dealing. And, in breach of
the oil and gas leases, XTO Energy began to deduct various
expenses in calculating and paying royalties.
According to Mr. Borkovic, XTO Energy has not yet retained counsel
for this matter.
"The leases at issue require XTO to pay royalties based upon the
total proceeds XTO receives for the gas," Mr. Borkovic said.
"XTO, however, is deducting supposed expenses from the proceeds
before it calculates the royalties, causing the royalties to be
significantly reduced."
Mr. Borkovic explained that the plaintiffs are seeking the
following: (i) to recover the difference between the royalties
they received and the amount of the royalties if they had been
calculated on the total proceeds XTO realized; and (ii) to obtain
an order declaring that expenses may not be deducted in the
royalty calculation.
According to Mr. Borkovic, the plaintiffs do not yet know the
number of individual plaintiffs who would be in the class; that
information will be obtained from the defendant's records in
discovery.
"Without discovery, we are already aware that there are more than
100 such individuals," said Mr. Borkovic. "We cannot even
estimate the amount of total compensation plaintiffs will seek
without knowing the extent of the class," he said. "The value of
the class claims, however, will easily exceed $5 million -- the
minimum for CAFA [Class Action Fairness Act of 2005]
jurisdiction."
Suann Lundsberg Guthrie, XTO Energy's media adviser for public and
government affairs, in the company's Fort Worth office, did not
return a call seeking comment.
Mr. Borkovic discussed the future timeline of the case. He said,
"The magistrate to whom the case was assigned normally holds an
initial management conference within two weeks after a defendant
files an answer or a responsive motion."
* FCC Turns Attention to Telecom Deceptive Plan Practices
---------------------------------------------------------
Marlisse Silver Sweeney, writing for Law.com, reports that the
Federal Communications Commission is turning its attention to
deceptive data plan practices, according to Paul Pittman of Baker
& Hostetler in a recent post. The FCC imposed a record $100
million forfeiture fine against AT&T Mobility for offering
customers "unlimited data" without explaining it would be reduced
up to 20 times its normal speed if a person went over 5 GB of data
use in a billing cycle.
"The FCC's fine comes on the heels of revisions to its 2010 Open
Internet rules that expanded its enforcement authority over
'telecommunications service' providers to cover broadband Internet
service providers," explains Mr. Pittman. He says that with its
expanded authority, he expects the FCC to pursue more
telecommunications service providers for both deceptive practices
and for collecting data on their customers. The commission has
issued fines of $10 million against TerraCom and YourTel America
and $25 million against another global telecommunications company
for lax approaches to data privacy, says Mr. Pittman.
He notes this expansion in power makes the FCC a "major enforcer
in the privacy and online consumer protection arena, usurping
power traditionally reserved for the . . . Federal Trade
Commission."
* FLSA Overtime Revisions to Pose Big Challenges for Companies
--------------------------------------------------------------
Rebekah Mintzer, writing for Corporate Counsel, reports that in a
long-awaited announcement, the U.S. Department of Labor released
new regulations requiring companies to give overtime pay to a
whole new group of formerly exempt workers. Under these revisions
to the Fair Labor Standards Act, it's estimated that the rules
will lead to time-and-a-half pay for all hours logged over the 40-
hour workweek for nearly 5 million additional members of the U.S.
workforce.
It will take at least a few more months and a public comment
period before the rules, which were announced by President Barack
Obama earlier this week, become the law of the land. However,
companies already can get a pretty clear concept of what is
coming, and should think about preparing now for these potentially
major alterations to the way they categorize and compensate
employees.
"This is going to impact a lot of employees across the country and
basically across all sectors and industries in the United States,"
Michael Abcarian -- mabcarian@laborlawyers.com -- regional
managing partner at Fisher & Phillips' Dallas office, told
CorpCounsel.com.
Currently, the DOL only requires companies to give overtime pay to
exempt workers if their paychecks are below the threshold of $455
per week, or $23,660 per year. The announcement means that the
threshold, if approved in its present form, will be raised to $970
a week, or $50,440 a year, which means companies will be faced
with the prospect of handing overtime pay to many more workers.
In outlining the proposed regulations, the White House noted that
the regulations haven't been updated since 2004. The fact sheet
contends companies are denying workers overtime by inappropriately
trying to fit them into another exemption from the FLSA that
applies to those who perform professional, executive or
administrative duties, and that since exemption is determined
based on both duties and salary range, a higher salary ceiling
will correct for this.
According to Mr. Abcarian, a smart place for companies to start
with these regulatory changes is getting their classification
houses in order. Do existing practices for determining who is
exempt and nonexempt work? Is every worker in the right category?
"The first step is figuring out how to get your pay packages right
under the new regulations, because if you've got mistakes in what
you're currently doing, you've got new mistakes under the new
regulations," said Mr. Abcarian.
Then in-house counsel will have to help their companies decide
what to do with FLSA-exempt employees who now, for the first time,
will be above the overtime threshold. One option, explained
Alfred Robinson Jr. -- alfred.robinson@ogletreedeakins.com -- a
shareholder at Ogletree, Deakins, Nash, Smoak & Stewart, is simply
paying exempt workers enough to push them above the $50,440 per
year line. However, this can be an expensive proposition.
Another possibility is to go with the changes that the DOL has
proposed and reclassify relevant employees as nonexempt. Besides
having to ensure that these employees' job duties fit the DOL
standards for nonexempt workers and making certain that they get
paid at or above the minimum hourly wage and for overtime,
companies also will have to focus on the record-keeping
responsibilities associated with nonexempt employees. "Then it
will be more of a challenge to manage the hours that these
individuals who are reclassified actually work," Mr. Robinson told
CorpCounsel.com.
There may be other ways out of the problem too, he noted,
including an idea floated by the DOL in its proposed rules that
would, in certain circumstances, count nondiscretionary bonuses
given on at least a monthly basis as part of employee pay, helping
more workers exceed the proposed threshold. The DOL asked for
more comments on this idea.
Once companies have decided how to handle the situation, they will
need to adjust budgets and other projections accordingly. And
what will make that even more difficult is that the proposed
regulations index the pay range for overtime exemption to other
aspects of the economy, meaning that it will most likely continue
to rise and rise as the years go on.
Lee Schreter, co-chairwoman of Littler Mendelson's wage and hour
practice group, told CorpCounsel.com that this could cause big
problems for companies. They will not only have to re-evaluate
their workforce and corresponding budgeting on a frequent basis,
she said, but they will have very little time to make decisions,
given that the proposed rules only give companies 60 days between
the announcement of a rise in the threshold to correct for it.
"Every time this goes up, employers are going to go through the
process of deciding whether they want to raise salaries or convert
people to being nonexempt employees," she noted. "That can be a
process that take far longer than 60 days."
Ms. Schreter added that there will be both direct costs to
companies as a result of the need to get into compliance with new
rules and indirect ones as not every employee is going to take
kindly to having their status under the FLSA debated and changed.
"It's a perpetual stirring of the employee relationship pot thanks
to the Department of Labor," she said.
Employers also should note that under the proposed regulations,
the DOL plans to raise the annual salaries in the "highly
compensated employee" category. The guidance also asks for
interested parties to weigh in on whether the FLSA duties test,
which is used to evaluate whether a worker's job description makes
them exempt or not, should be changed. This hints at more
potential shake-ups ahead in the FLSA.
* San Francisco to Enforce Retail Workers Bill of Rights
--------------------------------------------------------
Erin Winters, Esq. of Foster Employment Law, in an article for
Corporate Counsel, reports that San Francisco will begin to
enforce its Retail Workers Bill of Rights on July 3 -- just in
time for the big Independence Day holiday. As the city's
employers implement new policies and scheduling practices to
comply, businesses across the county are facing the passage of
similar laws on state and local levels that would penalize
employers for not providing advance notice of schedules and
schedule changes.
This may be a good time for companies to take heed of what's
happened here.
The Background
In November 2014, the San Francisco Board of Supervisors passed
the Hours and Retention Protections for Formula Retail Employees
Ordinance, and the Fair Scheduling and Treatment of Formula Retail
Employees Ordinance. Together, these laws are referred to as the
Formula Retail Labor Protections Ordinances, or perhaps more
commonly the Retail Workers Bill of Rights. The ordinances became
effective in January, but enforcement only will begin now.
Under the new laws, certain standardized "formula retail"
businesses, such as big box stores, fast food franchises, banks
and chain restaurants with 20 or more retail outlets worldwide and
20 or more employees in the city must provide:
Two weeks' advance notice of schedules, as well as "predictability
pay" when schedules change with less than seven days' notice but
more than 24 hours' notice, and another rate if an employees'
schedule changes with less than 24 hours' notice.
A "good faith" estimate of the number of scheduled shifts per
month, as well as the days and hours of the shifts, to new
employees.
Reporting pay for on-call employees who are not asked to come in
to work.
Provisions for part-time employees, including equal treatment and
preference for additional hours to qualified workers.
Worker protections when a business is sold.
Employees covered by the ordinances include any person who in a
particular week performs at least two hours of work for an
employer within the geographic boundaries of the city and county
of San Francisco and qualifies for state minimum wage, or is
scheduled for an on-call shift of at least two hours, regardless
of whether the person actually reports for the on-call shift.
The ordinances present several new challenges for employers in San
Francisco, who already must comply with the city's sick leave,
minimum wage, commuter and health care benefits laws. Now
employees have the right to negotiate their hours and days of work
upon hire, and part-time employees must be given equal treatment
in their starting pay, access to employer-provided unpaid and paid
time off, and eligibility for promotions. Employers must keep all
records of scheduling (and changes) and scheduling notices for at
least three years.
The city's Office of Labor Standards Enforcement (OLSE) will
enforce the ordinances and is vested with power to order
compliance, issue warnings and notices, and require the payment of
back wages and fines. The city attorney may also bring a civil
action.
The Rise of Just-in-Time Scheduling
In an effort to control costs, employers have adopted computerized
scheduling tools that interpret an array of data -- from sales
trends and economic indicators to the weather and current
events -- to predict staffing needs. Further, businesses assign
on-call shifts that can be canceled, and they overschedule shifts
(and then send employees home if customer traffic is low) in order
to maximize labor budgets. Many of these practices are referred
to as "just-in-time" scheduling.
According to some estimates, about 17 percent of the U.S.
workforce is subject to just-in-time scheduling, which results in
uncertain schedules and little advance notice of upcoming work
hours. Critics point out that low-wage, part-time employees are
most often subjected to the practices, which result in fluctuating
pay and make it nearly impossible for them to hold other jobs,
attend school or schedule child care.
Notably, the number of part-time workers has grown faster than the
number of full-time workers, and since 2007 the number of
"involuntary" part-time workers has doubled, according to
published reports.
Along with advocating for minimum wage increases, labor
organizations and employee groups have promoted fair scheduling
legislation designed to limit shift fluctuations, create advance
notice of schedules and allow for existing part-time employees to
be offered additional hours prior to hiring new employees,
subcontractors or temporary staffing agencies. Advocates hope
that such measures will provide some part-time employees with
control over when they work as well as more stable pay.
Nationwide Efforts at Predictable Scheduling
In 2014, Rep. George Miller, D-California, and Sen. Tom Harkin,
D-Iowa, introduced the Schedules That Work Act. The legislations,
which was not enacted, sought to provide scheduling predictability
similar to the San Francisco ordinances.
Despite the failure at the federal level, states and cities are
exploring similar laws. In May, workers in New Haven,
Connecticut, rallied in support of 21 days' advance notice of
schedules. The Albuquerque City Council is considering an act to
require all employers in that city to provide employees schedules
three weeks in advance. A similar proposal is expected before the
Council of the District of Columbia sometime this year.
On the state level, currently many laws require employers to pay
"reporting time" or "call-in pay" to employees who are scheduled,
but who are not put to work or are provided fewer hours than were
scheduled. But following San Francisco's success, lawmakers have
introduced predictable scheduling bills in several states,
including California, Connecticut, Illinois, Indiana, Maine,
Maryland, Massachusetts, Michigan, Minnesota, New York and Oregon.
Several of those bills are stuck in committee.
In June, California's bill to provide at least two weeks notice of
shifts was put on inactive status in the state Legislature. The
bill's co-sponsor, David Chiu, D-San Francisco, did not have the
necessary support to move it forward. The California Chamber of
Commerce deemed the bill a "job killer," but the bill is expected
to return for the 2016 session. (Chiu, a former member of the San
Francisco Board of Supervisors, was instrumental in passing San
Francisco's law.)
Critics of these laws point to the overregulation of businesses
and the burden for employers to comply with the scheduling
requirements.
Some state lawmakers are considering ways they can preempt local
ordinances. The Oregon Senate, for instance, is considering a
bill that would prohibit cities from passing fair scheduling laws
for at least two years.
Beyond Legislation
Legislation is not the only approach states are taking. Earlier in
the year, the New York Attorney General's office announced its
investigation of 13 large retailers over "call-in pay" and whether
these schedules violate the state's labor laws.
The AG's letters to the retailers stated, in part, "Our office has
received reports that a growing number of employers, particularly
in the retail industry, require their hourly workers to work what
are sometimes known as 'on call shifts' -- that is, requiring
their employees to call in to work just a few hours in advance, or
the night before, to determine whether the worker needs to appear
for work that day or the next."
The letters demanded information on how the retailers scheduled
employee "call-in" shifts. The New York law (along with those in
a handful of other states) requires employers to pay nonexempt
employees whenever they report to work, whether or not they
perform any work whatsoever.
Practice Pointers
As cities and states adopt fair scheduling laws, covered employers
should:
Review scheduling and on-call practices, as well as documentation
and document retention policies for schedules and schedule
changes.
Consider strategies for notifying the workforce of schedules and
schedule changes.
Monitor the developments of state legislatures and city
governments that are considering fair scheduling laws.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Class Action Reporter is a daily newsletter, co-published by
Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania,
USA, and Beard Group, Inc., Washington, D.C., USA. Marion
Alcestis A. Castillon, Ma. Cristina Canson, Noemi Irene A. Adala,
Joy A. Agravante, Valerie Udtuhan, Julie Anne L. Toledo,
Christopher G. Patalinghug, and Peter A. Chapman, Editors.
Copyright 2015. All rights reserved. ISSN 1525-2272.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The CAR subscription rate is $775 for six months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact
Peter A. Chapman at 215-945-7000 or Nina Novak at 202-362-8552.
* * * End of Transmission * * *