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/raid1/www/Hosts/bankrupt/CAR_Public/140624.mbx C L A S S A C T I O N R E P O R T E R Tuesday, June 24, 2014, Vol. 16, No. 124 Headlines A F HAUSER: Motion to Certify Class in "Sturdy" Suit Denied ABIOMED INC: Dismissal of Mass. Securities Suit Under Appeal ACXIOM CORP: Reaches Settlement Agreement in "Henderson" Lawsuit ALABAMA: Prisoners Sue Over Inadequate Medical & Mental Care ALAMEDA WATER: Faces Class Suit Alleging Breach of Contract ANGLO AMERICAN: Seeks Dismissal of Silicosis Class Action BALTIMORE, MD: Baltimore Teachers Union Files Class Action BLUCORA INC: Scott+Scott Files Class Action in W.D. Washington BMW OF NORTH AMERICA: Court Narrows Claims in "Gray" Class Suit CATERPILLAR INC: Engine-Failure Suits to Be Heard in N.J. Court CENTRON SERVICES: Removed "Giuffre-Johnson" Suit to Montana CIRRUS LOGIC: "Koplyay" Securities Suit in New York Now Closed COSTCO WHOLESALE: Settlement of Discrimination Class Suit Okayed CRACKER BARREL: Faces "Proper" FLSA Litigation in New York Court DFC GLOBAL: Faces Consolidated Suit in Delaware Over LSF8 Merger EATON CORP: Settlement Fairness Hearing Scheduled for July 23 FOCUS MEDIA: Settlement Fairness Hearing Scheduled for Sept. 4 FORD MOTOR: Plaintiff's Expert Can Testify in F250 Switch Suit FRONTLINE ASSET: Faces "Ashikenazi" Suit Alleging FDCPA Violation GC SERVICE: Violates Fair Debt Collection Act, Class Suit Says GENERAL MOTORS: "Andrews" Suit Seeks $10 Billion in Claims GENERAL MOTORS: "Heuler" Suit Consolidated in Ignition Switch MDL GENERAL MOTORS: "Ratzlaff" Suit Included in Ignition Switch MDL GENERAL MOTORS: No Ignition Claims Filed vs Trust Thru May 19 GENERAL MOTORS: Recalls About 510,000 Camaros Over Faulty Keys GENERAL MOTORS: Lawmakers to Scrutinize Recall Probe Findings GEORGIA: "R. A." Class Suit Filed Over Prison Condition GLADE KNIGHT: Faces Securities Suit by Apple REIT Shareholder GLOBAL TEL-LINK: Accused of Violating Telecommunications Act GRAIN PROCESSING: Iowa Supreme Court Reinstates Pollution Suit HALAL CHINA: Faces "Alejandro" Suit Alleging Violations of FLSA HULU: Court Refused to Certify Users Class in Privacy Litigation HUNTINGTON BANCSHARES: Faces Suit by Ohio Counties Over MERS IDENIX PHARMACEUTICALS: Being Sold for Too Little, Suit Claims INNOVATIVE DINING: Calif. Court Approves Class Action Settlement IRENEW BIO: "Litwin" Suit Remanded for Further Proceedings JPMORGAN CHASE: Has Initial OK of Mortgage Modification Suit Deal JUDGES' RETIREMENT: "Staniforth" Suit Ruling Partially Vacated KAMERYCAH INC: Removed "Lee" Suit to C.D. Calif. KINDER STUFF: Teaching Staff Seeks to Recover Unpaid Wages LA CONDESA CAFE: Sued Over Failure to Pay Overtime Compensation LIFE PARTNERS: Expects Discovery to Commence in Securities Suit LIFE PARTNERS: Suit by Life Settlement Interest Buyers Closed LIFE PARTNERS: Certification of Life Settlement Suit Under Appeal LIFE PARTNERS: Appeals Decision in "Arnold" Securities Suit LIFE PARTNERS: Bellwether Trial in Overpayment Suit Set for Sept. LIFE PARTNERS: "Steuben" Suit Awaits Resolution of "Willingham" LINKEDIN CORP: Judge Allows Suit Over Marketing Emails to Proceed MAIDENFORM BRANDS: Faces Class Suit Over Novarel Slimming Claims MANSFIELD BANK: Suit Seeks to Recover Unpaid Overtime Wages MICHIGAN: "Rivera" Suit v. Correction Dept. May Proceed MONTANA: Farmers Lose Class Action Over Tax Increases MONTREAL MAINE: Train Derailment Class Action Hearings Begin MORGAN STANLEY: Dismissal of Claims in "Coultier" Suit Affirmed MORGAN STANLEY: Obtains Favorable Ruling in Pass-Thru Cert. Suit NAP NANNY: CPSC Announces 6th Baby Death Due to Infant Recliner NEW EXPRESS MOBIL: Suit Seeks to Recover Unpaid Overtime Wages NORTH CAROLINA: "Alston" Suit v. Public Safety Dept Dismissed NY THRUWAY AUTHORITY: Sued by Terminated Workers and Their Union PARTNERSHIP HEALTH: Settles Wrongful Discharge Suits for $189,000 PNEUMO ABEX: Has No Duty to Warn Employee's Nephew, Court Says POM WONDERFUL: Faces Suit Over Deceptive Juice Labeling PRIMARY FINANCIAL: Sued for Violating Fair Debt Collection Act SCHNUCKS BAKERY: Issues Voluntary Recall of Devil's Food Cakes SCIENTIFIC DRILLING: "Smith" Suit Moved From Wyoming to Texas SHRED-IT USA: Accused of Violating Fair Credit Reporting Act SPECIALIZED LOAN: Suit Challenges Use of Automatic Dialing System SOURCE REFRIGERATION: Refused to Pay Proper Overtime, Suit Claims SWT ARIZONA: Fails to Pay Overtime Wages Under FLSA, Suit Claims TARSADIA HOTELS: Ruling in "Royalty Alliance" Suit Upheld TRIANGLE AUTO: Fails to Pay Overtime Wages, Car Salesman Claims UNITED HEALTHCARE: Sued for Denying Mental Health Claims US BANK: Homeowner Class Certified in Force-Placed Insurance Suit VERIZON WIRELESS: Sanctions Denial in Text Messaging MDL Appealed ZUMIEZ INC: Calif. Court Approves Deal in "Steele" Labor Suit * Firms Can No Longer Claim Safe Harbor in False Labeling Suits * Defendants Must Step Up Fight in Data Breach Class Actions * Discovery Rules in Lead Paint & Toxic Tort Suits Clarified ********* A F HAUSER: Motion to Certify Class in "Sturdy" Suit Denied ----------------------------------------------------------- Dr. Mark W. Sturdy filed his complaint against A. F. Hauser Inc. and John Does 1-10 on November 11, 2013. On that same date, the Plaintiff filed a Motion to Certify Class. District Judge Colin S. Bruce concludes that the Plaintiff's Motion to Certify Class should be denied because the Plaintiff's estimate of group membership is speculative and is not properly supported. Neither the Plaintiff nor the record establish that there is an objective, reasonable way to ascertain potential class members, he adds. For this reason, the court concludes that the Plaintiff has not met the numerosity requirement of Rule 23(a)(1) of the Federal Rules of Civil Procedure. The case is DR. MARK W. STURDY d/b/a ROCHESTER VETERINARY CLINIC on behalf of itself and a class, Plaintiff, v. A. F. HAUSER INC. and JOHN DOES 1-10 Defendants, CASE NO. 13-CV-3379, (C.D. Ill.) A copy of Judge Bruce's May 28, 2014 Opinion is available at http://is.gd/B1ac8V from Leagle.com. Dr Mark W Sturdy, Plaintiff, represented by Dulijaza Julie Clark -- jclark@edcombs.com -- EDELMAN COMBS LATTURNER & GOODWIN LLC & Michelle R Teggelaar -- mteggelaar@edcombs.com -- EDELMAN COMBS LATTURNER & GOODWIN LLC. Dr Mark W Sturdy, Plaintiff, represented by Daniel A Edelman -- dedelman@edcombs.com -- EDELMAN COMBS LATTURNER & GOODWIN LLC. ABIOMED INC: Dismissal of Mass. Securities Suit Under Appeal ------------------------------------------------------------ Plaintiffs in a securities suit against ABIOMED, Inc. in the U.S. District Court for the District of Massachusetts filed a notice of appeal against the dismissal of the case, according to the company's May 28, 2014, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended March 31, 2014. On November 16 and 19, 2012, two purported class action complaints were filed against the company and certain of the company's officers in the U.S. District Court for the District of Massachusetts by alleged purchasers of the company's common stock, on behalf of themselves and persons or entities that purchased or acquired the company's securities between August 5, 2011 and October 31, 2012. The complaints alleged that the defendants violated the federal securities laws in connection with disclosures related to the FDA and the marketing and labeling of the company's Impella 2.5 product and seek damages in an unspecified amount. The Court has consolidated these complaints and a consolidated amended complaint was filed by the plaintiffs on May 20, 2013. On July 8, 2013, the company filed a motion to dismiss the consolidated class action. Oral arguments on the company's motion to dismiss were conducted before the presiding district court judge on September 18, 2013. On April 10, 2014, the U.S. District Court entered an order granting the company's motion and dismissed the consolidated and amended complaint. On May 9, 2014, the plaintiffs filed a notice of appeal. ACXIOM CORP: Reaches Settlement Agreement in "Henderson" Lawsuit ---------------------------------------------------------------- The parties in the suit Henderson, et al. v. Acxiom Risk Mitigation, Inc. have reached a tentative settlement agreement, according to the company's May 28, 2014, Form 10-K filing with the U.S. Securities and Exchange Commission for the year ended March 31, 2014. On August 16, 2012, a putative class action styled Henderson, et al. v. Acxiom Risk Mitigation, Inc., et al. was filed in the United States District Court for the Eastern District of Virginia against the Company, Acxiom Information Security Systems, a former subsidiary of the Company that was sold to another company in fiscal 2012, and Acxiom Risk Mitigation, Inc. (now known as Acxiom Identity Solutions, LLC, a Colorado limited liability company), a subsidiary of the Company. The action seeks to certify nationwide classes of persons who requested a consumer file from any Acxiom entity from 2007 forward; who were the subject of an Acxiom report sold to a third party that contained information not obtained directly from a governmental entity and who did not receive a timely copy of the report; who were the subject of an Acxiom report and about whom Acxiom adjudicated the hire/no hire decision on behalf of the employer; who, from 2010 forward, disputed an Acxiom report and Acxiom did not complete the investigation within 30 days; or who, from 2007 forward, were the subject of an Acxiom report for which no permissible purpose existed. The complaint alleges various violations of the Fair Credit Reporting Act and seeks injunctive relief, an unspecified amount of statutory, compensatory and punitive damages, attorneys' fees and costs. The parties have reached a tentative settlement agreement and the Company has accrued $3.7 million as its estimate of the probable loss associated with this matter. ALABAMA: Prisoners Sue Over Inadequate Medical & Mental Care ------------------------------------------------------------ Joshua Dunn, et al., on behalf of themselves and all others similarly situated; and Alabama Disabilities Advocacy Program v. Commissioner Kim Thomas, in his official capacity as Commissioner of the Alabama Department of Corrections; Ruth Naglich, in her official capacity as Associate Commissioner of Health Services for the Alabama Department of Corrections; and Alabama Department of Corrections, Case No. 2:14-cv-00601-WKW-TFM (M.D. Ala., June 17, 2014), is brought on behalf of the Plaintiffs and similarly situated persons, who are incarcerated in Alabama Department of Corrections prisons. The Plaintiffs seek to remedy, among other things, the Defendants' alleged failure to provide to persons in the custody of the ADOC constitutionally adequate medical care and mental health care. The Plaintiffs are Joshua Dunn; Alex Ball; Edward Braggs; Tedrick Brooks; Gary Lee Broyles; Richard Businelle; Bobby Copeland; Howard Carter; Chandler Clements; Robert Dillard; Christopher Gilbert; Dwight Hagood; Daletrick Hardy; Sylvester Hartley; Christopher Jackson; Brandon Johnson; John Maner; Rick Martin; Willie McClendon; Roger McCoy; Jermaine Mitchell; Kenneth Moncrief; Tommie Moore; Matthew Mork; Zerrick Naylor; Bradley Pearson; Leviticus Pruitt; Turner Rogers; Jonathan Sanford; Timothy Sears; Brian Sellers; Augustus Smith; Richard Terrell; Hubert Tollar; Daniel Tooley; Joseph Torres; Donald Ray Turner; William Villar; Jamie Wallace; Robert "Myniasha" Williams; and Alabama Disabilities Advocacy Program. Defendant Kim Thomas is the Commissioner of the ADOC, while Ruth Naglich is the Associate Commissioner of Health Services for the ADOC. The ADOC is the administrative department of the state of Alabama responsible for administering and exercising the direct and effective control over penal and corrections institutions throughout Alabama. The Plaintiffs are represented by: Maria V. Morris, Esq. Ebony Howard, Esq. SOUTHERN POVERTY LAW CENTER 400 Washington Avenue Montgomery, AL 36104 Telephone: (334) 956-8200 Facsimile: (334) 956-8481 E-mail: maria.morris@splcenter.org ebony.howard@splcenter.org - and - Miriam Haskell, Esq. SOUTHERN POVERTY LAW CENTER P O Box 370037 Miami, FL 33137 Telephone: (786) 347-2056 Facsimile: (786) 237-2949 E-mail: miriam.haskell@splcenter.org - and - William Van Der Pol, Jr., Esq. James Patrick Hackney, Esq. ALABAMA DISABILITIES ADVOCACY PROGRAM University of Alabama 500 Martha Parham West P. O. Box 870395 Tuscaloosa, AL 35487 Telephone: (205) 348-4928 Facsimile: (205) 348-3909 E-mail: jphackney@adap.ua.edu wvanderpoljr@adap.ua.edu ALAMEDA WATER: Faces Class Suit Alleging Breach of Contract ----------------------------------------------------------- Stanley P. McBride and Marilyn Wright, On Behalf of Themselves and All Others Similarly Situated v. Alameda County Water District, Case No. 3:14-cv-02789-EDL (N.D. Cal., June 17, 2014), arises from alleged breach of contract. The Plaintiffs are represented by: Ronald Scott Kravitz, Esq. LAW OFFICES OF RONALD S. KRAVITZ One California Street, Suite 900 San Francisco, CA 94111 Telephone: (415) 291-2421 E-mail: rkravitz@kravitzesq.com ANGLO AMERICAN: Seeks Dismissal of Silicosis Class Action -------------------------------------------------------- Dewald van Rensburg, writing for City Press, reports that big mining companies ask a court not to allow a class action lawsuit -- not because there's no case, but because it may be too "gargantuan" to handle. Gold mining companies, past and present, have filed thousands of pages of court papers in their bid to stop the historic class action by former mine workers suffering from silicosis. The mines are not only arguing against the class action on legal principles, but allege it would be virtually impossible for the South Gauteng High Court to manage a case this "gargantuan". Some of the companies have squarely taken aim at the lawyers who are trying to represent the mine workers, alleging questionable motives and legal tactics designed to maximize fees, even if it complicates the case. At this point, mines are only arguing against the certification of a class action, not the actual questions of liability and damages. The class action aims to cover practically all gold miners since the 1950s, potentially resulting in billions of rands in claims against dozens of mining companies. Most notable among the respondents are Anglo American SA, AngloGold Ashanti, Gold Fields and Harmony. The different companies are taking very different approaches, owing in part to their very different liabilities. AngloGold Ashanti, for instance, has only existed in its own right since being divested by Anglo American in 1998 and faces far fewer claims than Anglo itself or Gold Fields, which ran the country's largest mines near Carletonville for half a century. Anglo says the scale of the class action envisaged "boggles the imagination". In its papers, it estimates the "gargantuan litigation" would require more than 50 lawyers representing mines and mine workers in a case "no viable legal proceeding could ever accommodate". Gold Fields and others are arguing that the kinds of evidence they will argue would be on an individual basis, interrogating the minutiae of possible dust exposures and alleged instances of negligence for thousands of people spanning a 60-year period. The mines are fundamentally fighting for the idea that there could be a collective case for collective damages. The mine workers' lawyers are ultimately aiming at a resolution similar to the settlement with asbestos mines more than a decade ago. Then the former Gencor paid millions into a fund that still exists and which sick ex-miners can approach for compensation. Counterattack One thrust of the gold mines' defense is to attack the motives of the well-known human rights lawyers representing mine workers and their US backers. Three separate class action cases were combined last year after most of the lawyers buried their differences. These are Richard Spoor, Charles Abrahams from Abrahams Kiewitz Attorneys and the Legal Resource Centre (LRC). Mr. Spoor is backed by US firm Motley Rice, while Abrahams has another American celebrity lawyer, Charles Hausmann, in his corner. The team of Leigh Day, a UK law firm, comprising Richard Meeran and his local partner Zanele Mbuyisa used to work with the LRC, but have gone their own way by filing thousands of separate cases, not as a class action. Gold Fields in particular has questioned the fee contracts of the various legal teams, especially after the consolidation of the three class actions. The company has filed copies of the legal teams' fee agreements as part of the papers and claims these contain clauses that are "highly questionable". Gold Fields has also said it will ensure the US firms backing the miners' lawyers join the case -- to argue for them to carry the formidable costs if the case fails. Other cases It emerged that another team of lawyers have separately filed thousands of individual silicosis cases against Anglo and AngloGold, mostly in March this year. Leigh Day, working with local firm Garratt Mbuyisa Neale, have filed 4,335 claims for a total of R7.6 billion against Anglo in Gauteng. They also filed 1,204 claims against AngloGold for R2.1 billion. These cases were mostly filed after Leigh Day parted ways with the LRC late last year when the LRC opted to join up with Spoor and Abrahams in a single class action. Earlier, Mr. Meeran had also lodged 4,202 claims against Anglo in the UK. The past and present divisions between the lawyers have given the mines ammunition. Anglo accused Mr. Meeran of "unashamedly cherry-picking" jurisdictions "in order to maximize the damages claim and the amount of success fees". Mr. Spoor has also lodged one case separately from the class action, involving only one individual mine worker claiming R25 million from Harmony and Gold Fields. Anglo has used this to argue that even the most vocal supporter of the class action route clearly thinks there are other ways to handle silicosis claims. BALTIMORE, MD: Baltimore Teachers Union Files Class Action ---------------------------------------------------------- Erica L. Green, writing for The Baltimore Sun, reports that the Baltimore Teachers Union has filed a class action grievance against the city school system after the district made last-minute changes to its evaluation system, which knocked teachers down in ratings that are also tied to their ability to earn pay raises. In an email to members, Marietta English, president of the BTU, said the union filed the grievance because of changes the district made to the "cut scores," which affect whether a teacher is rated "highly effective" "effective," "developing" or "ineffective." For example, a teacher who scored an 80 or above out of 100 under the previous system would be considered "highly effective," but this year would need to earn an 86 to receive the highest rating. For some teachers, those six points mean not receiving an automatic pay raise under the union contract, which began tying evaluations to compensation in 2010. "There have been a lot of concerns regarding the teacher evaluation," English wrote in the email. "The BTU never agreed to change the percentages within the evaluation." When teachers began receiving their year-end evaluations, they were notified that the cut scores had changed. The ratings also changed to rely heavily on classroom observations, which accounted for 85 percent of this year's evaluation in the absence of measuring student growth through test scores. City school officials said on June 6 that they received a letter from the union stating concern about the new cut-score system and that they are willing to go back to the bargaining table to negotiate. The issue stemmed from legislation that wasn't signed until May, prohibiting the use of test scores in teacher or principal evaluations until 2016-2017. The district decided that if it couldn't measure student growth by using scores from the state test, that it would raise the cut scores. Interim CEO Tisha Edwards said the district thought that it had agreed upon that compromise with the union. "This was not in bad faith," Ms. Edwards said. "I think teachers have a valid concern about the option that we chose and the notification, but the spirit of what we chose was in the best interest of teachers and students. Our partnership with the union is important, so we're open to revisiting it." For Bobbi O'Brien, a ninth-grade teacher at Patterson High School, her score of 69 this year meant that she was no longer considered an "effective" teacher, but a "developing" one. The changes also meant that if she hadn't taken a graduate course this year, which earned her credits called "achievement units" that teachers can use to move up a pay ladder, she would not receive a raise. Ms. O'Brien, who has been teaching in the city for four years and has a record of proficient evaluations in the system, said the "developing" label she received was based largely on a classroom observation that she felt was subjective. She said she didn't explain her class objectives in a way that her principal this year thought was exemplary, even though it was the same way that had earned her the highest marks on evaluations before. "The city would have the public believe that the difference between a highly effective and developing teacher is that one doesn't have what it takes," Ms. O'Brien said. "When really it's whether or not I can showcase all of the skills I have as a teacher in two 90-minute periods of the school year." She said the fact that this year's score, though disappointing, would have rated her as effective last year added "insult to injury." Many teachers also questioned whether the cut-score changes were aimed at limiting the pay raises that would be required with a high number of "highly effective" teachers. Iris Kirsch, of the Educators for Democratic Schools, a group that has challenged the pay-for-performance contract, said she believed system officials used evaluation data provided by principals last month to put a last-minute cap on "highly effective" ratings. "Even the people who focused on all the things you could do to get a higher evaluation, who put all their eggs in one basket, are being robbed," she said. "It's just so demoralizing." BLUCORA INC: Scott+Scott Files Class Action in W.D. Washington -------------------------------------------------------------- On May 12, 2014, Scott+Scott, Attorneys at Law, LLP filed a class action complaint against Blucora, Inc. in the U.S. District Court for the Western District of Washington. The complaint was filed on behalf of those persons and entities who purchased or otherwise acquired Blucora securities between November 5, 2013 and February 20, 2014 and seeks remedies under the Securities Exchange Act of 1934. Investors who purchased Blucora securites during the Class Period and wish to serve as a lead plaintiff in the class action must move the Court no later than July 14, 2014. Members of the investor class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain absent class members in the lawsuit. The securities class action charges that, throughout the Class Period, Blucora made false and/or misleading statements, as well as failed to disclose material adverse facts about Blucora's business, operations, and prospects. The complaint alleges that when this adverse information became known, the Company's share prices declined significantly. If you wish to view the complaint, discuss the Blucora litigation, or have questions concerning this notice or your rights, please contact Michael Burnett of Scott+Scott at mburnett@scott-scott.com (800) 404-7770, or (860) 537-5537, or visit the Scott+Scott website for more information: http://www.scott-scott.com Scott+Scott has significant experience in prosecuting major securities, antitrust, and employee retirement plan actions throughout the United States. The firm represents pension funds, foundations, individuals, and other entities worldwide. BMW OF NORTH AMERICA: Court Narrows Claims in "Gray" Class Suit --------------------------------------------------------------- ROBERT GRAY and MARKUM GEORGE, individually and on behalf of a class similarly situated individuals, Plaintiffs, v. BMW OF NORTH AMERICA, LLC and BMW AKTIENGESELLSCHAFT, Defendants, NO. 13-CV- 3417-WJM-MF, (D. N.J.) is a putative class action based on allegations of consumer fraud. Plaintiffs Robert Gray and Markum George filed the Complaint individually and on behalf of a putative class of people who purchased or leased any 2004-2010 model year BMW E64 (6 Series Convertible). Plaintiffs principally allege that Defendants fraudulently failed to disclose that these cars had a known defect that interferes with the proper opening and closing of their convertible tops. Defendant BMW of North America filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), or in the alternative, to strike the class allegations. Plaintiffs opposed. District Judge William J. Martini granted in part and denied in part the Defendants' motion to dismiss. These counts of the Complaint are dismissed: 1) Count 1: New Jersey Consumer Fraud Act 2) Count 3: Breach of Duty of Good Faith and Fair Dealing 3) Count 4: Unjust Enrichment 4) Count 7: Song-Beverly Act A copy of Judge Martini's May 28, 2014 Opinion is available at http://is.gd/RoK7fFfrom Leagle.com. ROBERT GRAY, Plaintiff, represented by MATTHEW ROSS MENDELSOHN -- mmendelsohn@mskf.net -- MAZIE SLATER KATZ & FREEMAN LLC. Markum George, Plaintiff, represented by MATTHEW ROSS MENDELSOHN, MAZIE SLATER KATZ & FREEMAN LLC. BMW OF NORTH AMERICA, LLC, Defendant, represented by CHRISTOPHER J. DALTON -- christopher.dalton@bipc.com -- BUCHANAN, INGERSOLL & ROONEY, PC & ROSEMARY JOAN BRUNO -- rosemary.bruno@bipc.com -- BUCHANAN, INGERSOLL & ROONEY, PC. CATERPILLAR INC: Engine-Failure Suits to Be Heard in N.J. Court --------------------------------------------------------------- Charles Toutant, writing for New Jersey Law Journal, reports that lawsuits from around the country claiming Caterpillar Inc.'s engines for trucks, buses and recreation vehicles frequently break down have been centralized in federal court in New Jersey. The Judicial Panel on Multidistrict Litigation, in consolidating five cases from California, Florida, Louisiana, Pennsylvania and New Jersey on June 11, said similar suits that are brewing in Georgia, Minnesota, North Carolina, Utah and Wisconsin may be transferred at a later date. Caterpillar wanted the venue to be Miami. The plaintiffs supported that choice but also suggested New Jersey, which the JPML said it chose because the case already here, BK Trucking Co. v. Caterpillar, is relatively advanced, with discovery underway. The case is assigned to Chief Judge Jerome Simandle, who will also take on the others. The suits charge that Caterpillar's C13 and C15 Advanced Combustion Emission Reduction Technology (ACERT) engines have defective emissions systems that cause them to stall suddenly, placing drivers and passengers at risk. The company knew of the defects but concealed them from buyers, the plaintiffs say, raising claims of breach of warranty and violation of various state consumer protection laws. The ACERT six-cylinder engines were made from 2007 to 2009 in response to stricter federal limits on emissions from diesel engines. Caterpillar stopped making truck and bus engines after 2010, says the complaint in BK Trucking. The plaintiff in that suit claims vehicles with ACERT engines incorporate a diesel particulate filter in the muffler to reduce soot buildup, but the filter becomes extremely hot, putting harmful pressure on other engine components, causing them to fail. In an answer filed on May 14, Caterpillar denied that the engines are defective and predisposed to failure or that it made misrepresentations to buyers about the reliability of its engines. The company also denied the plaintiff's claims that it suffered an ascertainable loss as a result of deceptive business practices and denied that vehicles the plaintiff bought with the ACERT engines have a lower resale value. Further denied was the plaintiffs' claim that Caterpillar dealers saw sharp increases in the volume of repair work they did after the ACERT engines were introduced. BK Trucking of Newfield, the plaintiff in the New Jersey case, is represented by Shepherd, Finkelman, Miller & Shah in Collingswood, N.J., and Trimble & Armano in Turnersville, N.J. Plaintiffs in the other four cases are represented by the Complex Litigation Group in Highland Park, Ill., with Seeger Weiss also on the plaintiff side in the California, Florida and Pennsylvania cases, and Cohen, Milstein, Sellers & Toll in Washington, D.C., also representing plaintiffs in the Florida case. Caterpillar is represented by Sedgwick in the California, New Jersey and Florida cases. In the Pennsylvania case it is represented by Campbell, Campbell, Edwards & Conroy of Wayne, Pa., and in the Louisiana case by McGlinchey Stafford of New Orleans. Caterpillar spokeswoman Barbara Cox said its ACERT engines offer operating cost savings and have successfully performed "across millions of miles in North America." She said the company "looks forward to addressing these allegations now that they have been consolidated in one forum." CENTRON SERVICES: Removed "Giuffre-Johnson" Suit to Montana ----------------------------------------------------------- The class action lawsuit captioned Giuffre-Johnson v. Centron Services, Case No. BDV-2014-403, was removed from the Montana First Judicial District Court, L & C County, to the U.S. District Court for the District of Montana (Helena). The District Court Clerk assigned Case No. 6:14-cv-00041-SEH to the proceeding. The lawsuit alleges violations of the Fair Debt Collection Practices Act. The Plaintiff is represented by: Robert Farris-Olsen, Esq. David K.W. Wilson, Jr., Esq. Scott L. Peterson, Esq. MORRISON, SHERWOOD, WILSON & DEOLA, PLLP 401 N Last Chance Gulch PO Box 557 Helena, MT 59601 Telephone: (406) 442-3261 Facsimile: (406) 443-7294 E-mail: rfolsen@mmslawgroup.com kwilson@mswdlaw.com speterson@mswdlaw.com The Defendant is represented by: Bruce M. Spencer, Esq. SMITH LAW FIRM PO Box 1691 Helena, MT 59624 Telephone: (406) 442-2980 Facsimile: (406) 449-3817 E-mail: bruce.spencer@smithlawmt.com CIRRUS LOGIC: "Koplyay" Securities Suit in New York Now Closed -------------------------------------------------------------- The securities suit Koplyay v. Cirrus Logic, Inc., et al. Civil Action No. 13-CV-0790 was concluded after plaintiffs did not file an appeal against the dismissal of the case, according to the company's May 28, 2014, Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended March 29, 2014. On February 4, 2013, a purported shareholder filed a class action complaint in the U.S. District Court, Southern District of New York against the Company and two of the Company's executives (the "Securities Case"). Koplyay v. Cirrus Logic, Inc., et al. Civil Action No. 13-CV-0790. The complaint alleges that the defendants violated the federal securities laws by making materially false and misleading statements regarding the company's business results between July 31, 2012, and October 31, 2012, and seeks unspecified damages along with plaintiff's costs and expenses, including attorneys' fees. A second complaint was filed on April 13, 2013, by a different purported shareholder, in the same court, setting forth substantially the same allegations. On April 19, 2013, the court appointed the plaintiff and counsel in the first class action complaint as the lead plaintiff and lead counsel. The lead plaintiff filed an amended complaint on May 1, 2013, including substantially the same allegations as the original complaint. On May 24, 2013, the Company filed a motion to dismiss the amended complaint for failure to state a claim. On December 2, 2013, the court granted the Company's motion and dismissed the case with prejudice. The plaintiff did not appeal the court's order and the case has concluded. COSTCO WHOLESALE: Settlement of Discrimination Class Suit Okayed ---------------------------------------------------------------- Bloomberg BNA reports that an $8 million settlement of sex discrimination claims by a class of 1,300 female Costco Wholesale Corp. employees who claimed the retailer discriminated in selecting general managers and assistant general managers throughout the U.S. received final approval May 27 from a federal judge in California. The order by Judge Edward M. Chen of the U.S. District Court for the Northern District of California in a case brought under Title VII of the 1964 Civil Rights Act comes after a May 22 fairness hearing and largely adopts the terms set forth in a proposed agreement submitted to the court last December. The $8 million fund will be used to pay claims made by class members who prevail under the process established by the agreement, as well as $10,000 service awards to three class representatives. The settlement also includes a new promotions process, creation of a posting process for AGM promotions, and a new "registration of interest" system for GM promotions. Any portion of the settlement fund remaining after the class claims and service award payments, and payment of up to $100,000 to an independent consultant retained by the parties as part of the programmatic relief, is to be donated to the Network of Executive Women, Consumer Products/Retail, after Judge Chen found a "driving nexus" between that organization and the class. The class originally sued the retail chain in August 2004. The lawsuit alleged that Costco discriminates against female employees by using a uniform, corporate-directed system that fails to promote equally or better qualified women into GM and AGM openings, including the use of subjective decision-making and unwritten, unvalidated job criteria and the use of "ready now" ratings and "promotable lists." The three named plaintiffs also asserted individual claims under California's Fair Employment and Housing Act, and two of them claimed retaliation under Title VII. The district court initially granted class certification in January 2007, but Costco appealed. Following the U.S. Supreme Court's landmark class action decision in Wal-Mart Stores Inc. v. Dukes, 131 S. Ct. 2541, 112 FEP Cases 769 (2011), the U.S. Court of Appeals for the Ninth Circuit remanded the case for the "rigorous analysis" of the requirements of Rule 23(a) of the Federal Rules of Civil Procedure and found that monetary relief to the female Costco employees under Rule 23(b)(2) was mostly foreclosed. On remand, Judge Chen certified the case as a hybrid class action, with one class certified for monetary relief and another for injunctive relief. CRACKER BARREL: Faces "Proper" FLSA Litigation in New York Court ---------------------------------------------------------------- The suit Proper v. Cracker Barrel Old Country Store, Inc., which alleges violations of the Fair Labor Standards Act is pending in the United States District Court for the Northern District of New York, according to the company's May, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 2, 2014. On April 11, 2014, a collective action under the Fair Labor Standards Act ("FLSA") was filed in the United States District Court for the Northern District of New York, Proper v. Cracker Barrel Old Country Store, Inc., in which the named plaintiffs are challenging the Company's classification of associate managers as being exempt from the minimum wage and overtime requirements. The plaintiffs seek an unspecified amount of alleged back wages, liquidated damages, and attorneys' fees. Unlike a class action, a collective action requires potential class members to "opt in" rather than "opt out". If an FLSA action is conditionally certified, the Company would have an opportunity to seek to have the class de-certified and/or seek to have the case dismissed on its merits. DFC GLOBAL: Faces Consolidated Suit in Delaware Over LSF8 Merger ---------------------------------------------------------------- DFC Global Corp. faces consolidated suit in the Court of Chancery of the State of Delaware over a merger agreement with LSF8 Sterling, according to DFC's May 28, 2014, Form 8-K filing with the U.S. Securities and Exchange Commission. Six purported class action lawsuits challenging [a] proposed merger (the "Merger") contemplated by the Agreement and Plan of Merger, dated April 1, 2014, among LSF8 Sterling Merger Parent, LLC, a Delaware limited liability company (as successor in interest to LSF8 Sterling Parent, LLC), LSF8 Sterling Merger Sub, LLC, a Delaware limited liability company and a wholly owned subsidiary of Parent (as successor in interest to LSF8 Sterling Merger Company, LLC), and the Company were filed with the Court of Chancery of the State of Delaware between April 8 and May 2, 2014 (collectively, the "Stockholder Litigation"). On May 13, 2014, the Court consolidated the six actions and appointed plaintiffs Michael Marcus and KC Gamma Opportunity Fund, LP as lead plaintiffs and their respective counsel as lead counsel. Also, on May 13, 2014, the Court granted the lead plaintiffs' motion for expedited proceedings. On May 24, 2014, the lead plaintiffs moved to preliminarily enjoin the special meeting for stockholders to vote on the Merger pending the disclosure of additional information, on the grounds that the defendants allegedly failed to disclose material information in the Definitive Proxy Statement. A hearing on the lead plaintiffs' motion was scheduled for May 30, 2014, at 10:00 a.m. before the Court of Chancery. EATON CORP: Settlement Fairness Hearing Scheduled for July 23 ------------------------------------------------------------- SUMMARY NOTICE OF PENDENCY AND PROPOSED SETTLEMENT OF SHAREHOLDER DERIVATIVE ACTION IN THE COURT OF COMMON PLEAS CUYAHOGA COUNTY, OHIO Case No.: CV 11 748467 Judge: John P. O'Donnell ALFRED STRAUS, Derivatively on Behalf of Nominal Defendant Eaton Corporation, plc, and on Behalf of Nominal Defendant Eaton Corporation, Plaintiff, v. MICHAEL J. CRITELLI, ALEXANDER M. CUTLER, NET C. LAUTENBACH, DEBORAH L. McCOY, GREGORY R. PAGE, CHARLES E. GOLDEN, ARTHUR E. JOHNSON, TODD M. BLUEDORN, GEORGE S. BARRETT, LINDA A HILL, GERALD B. SMITH, VICTOR LEO, MARK MCGUIRE, TARAS SZMAGALA, ERNIE GREENE, JOHN R. MILLER, VICTOR A. PELSON, and GARY L. TOOKER, Defendants, and EATON CORPORATION, plc, and EATON CORPORATION Nominal Defendants. TO: ALL FORMER AND CURRENT RECORD HOLDERS AND BENEFICIAL OWNERS OF COMMON STOCK OF EATON CORPORATION ("COMPANY") OR EATON CORPORATION PLC ("PLC") AS OF JUNE 6, 2014 ("STOCKHOLDERS"). YOU ARE HEREBY NOTIFIED, pursuant to an Order of the Cuyahoga County, Ohio Court of Common Pleas that a proposed settlement has been reached in this putative shareholder derivative action. A hearing will be held on July 23, 2014, at 1:30 p.m., before the Honorable John P. O'Donnell in Courtroom 18-D at the Cuyahoga County Court of Common Pleas, 1200 Ontario Street, Cleveland, Ohio 44113?1678, for the purpose of considering, among other things: (i) whether the proposed settlement will be approved by the Court pursuant to the terms of the Stipulation and Agreement of Settlement ("Stipulation"); (ii) whether the Court should enter a judgment dismissing Plaintiff's Complaint with prejudice and on the merits, including and all claims which arise out of or are related to the facts and/or circumstances set forth in Complaint; and (iii) whether the Court should approve the award to be made to Plaintiff's Counsel for Plaintiff's attorney fees, expenses, costs, and an incentive payment to Plaintiff, up to a total of six million dollars ($6,000,000). The Court has reserved the right to reschedule the hearing without further notice. Your rights as a Stockholder may be affected by this action and the proposed settlement. Additional details regarding this action, including the Notice of Pendency and Proposed Settlement of Shareholder Derivative Action ("Notice"), are available at http://www.weismanlaw.com You may also contact a representative of Plaintiff's Counsel, Weisman, Kennedy & Berris Co., L.P.A., 1600 Midland Building, 101 Prospect Avenue, W., Cleveland, Ohio 44115, telephone 800-475-1189 or 216-781-1111, or Strauss Troy Co., LPA, 150 East Fourth Street, Cincinnati, Ohio 45202-4018, telephone 513?621-2120, for further information. If you are a current Stockholder, you may have the right to object to any aspect of the Settlement and may appear in person or through counsel at the hearing. Stockholders who have no objection to the proposed settlement need not take any further action. Any objections to the settlement, including Plaintiff's Counsel's request for attorney fees, expenses, costs, and an incentive payment to Plaintiff, must be filed and served, in accordance with the procedures set forth in the Notice, no later than July 14, 2014. IF YOU CHOOSE TO OBJECT, YOU MUST FOLLOW THE PROCEDURES SET FORTH IN THE NOTICE OR YOU WILL NOT BE HEARD, AND NO PAPERS, BRIEFS, OR OTHER DOCUMENTS BY YOU WILL BE RECEIVED AND CONSIDERED BY THE COURT. Any Person who fails to object or otherwise request to be heard in the manner prescribed in the Notice will be deemed to have waived the right to object to any aspect of the settlement (including the right to appeal) or to request to be heard at the hearing, and will be forever barred from raising such objection or request in this or any other related action or proceeding. PLEASE DO NOT CONTACT THE COURT OR THE CLERK'S OFFICE ABOUT THIS NOTICE. Dated: June 6, 2014 BY ORDER OF THE CUYAHOGA COUNTY, OHIO COURT OF COMMON PLEAS FOCUS MEDIA: Settlement Fairness Hearing Scheduled for Sept. 4 -------------------------------------------------------------- SUMMARY NOTICE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK XUECHEN YANG, Individually and on Behalf of All Others Similarly Situated, Plaintiff, FOCUS MEDIA HOLDING LIMITED, JASON NANCHUN JIANG, CHARLES GUOWEI CAO, KIT LEONG LOW, DANIEL MINGDONG WU, ALEX DEYI YANG, NEIL NANPENG SHEN, FUMIN ZHUO, DAQING QI, DAVID ZHANG, AND YING WU, Defendants. Case No.: 1:11-cv-09051-CM TO: ALL PERSONS WHO PURCHASED OR OTHERWISE ACQUIRED AMERICAN DEPOSITORY SHARES ("ADSs") OF FOCUS MEDIA HOLDING LIMITED ("FOCUS MEDIA" OR "THE COMPANY") BETWEEN NOVEMBER 20, 2007 THROUGH NOVEMBER 21, 2011, INCLUSIVE (COLLECTIVELY, THE "SETTLEMENT CLASS"). If you meet the above Class definition, you could get a payment from a class action settlement. A federal court authorized this Notice. This is not a solicitation from a lawyer. YOU ARE HEREBY NOTIFIED, pursuant to an Order of the United States District Court for the Southern District of New York, that a hearing will be held on September 4, 2014, at 9:30 a.m., before The Honorable Colleen McMahon, at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, New York, New York (the "Court"), for the purpose of determining (1) whether the proposed settlement of claims in the above-captioned Action for consideration, including the sum of $3,700,000.00 (three million seven hundred thousand dollars) in cash, should be approved by the Court as fair, reasonable and adequate; (2) whether this Action should be dismissed with prejudice as to the Defendants pursuant to the terms and conditions set forth in the Stipulation dated as of May 13, 2014; (3) whether the proposed plan to distribute the settlement proceeds (the "Plan of Allocation") is fair, reasonable and adequate and therefore should be approved; and (4) whether the application of Plaintiffs' Counsel for the payment of attorneys' fees and expenses incurred in connection with this Action and reimbursement of the Lead Plaintiff's reasonable costs and expenses (including lost wages) directly related to their representation of the Settlement Class should be approved. If you purchased or otherwise acquired Focus Media ADSs between November 20, 2007 and November 21, 2011, inclusive, your rights may be affected by this Settlement, including the release and extinguishment of claims you may possess relating to your ownership interest in the ADSs. If you are a member of the Settlement Class, in order to share in the distribution of the Net Settlement Fund, you must submit a Proof of Claim and Release form that is received no later than August 1, 2014, establishing that you are entitled to recovery. If you desire to be excluded from the Settlement Class, you must submit a request for exclusion to Focus Media Holding Limited Securities Action, Exclusions, 3410 West Hopkins Street, PO Box 170500, Milwaukee, WI 53217-8091, so that it is received by July 17, 2014. Any objection to any aspect of the Settlement must be filed with the Court, Plaintiffs' Counsel Designee and the Company's Counsel Designee, no later than July 17, 2014. If you wish to receive a detailed Notice concerning the terms of the Settlement or the Proof of Claim and Release form, you may obtain copies by writing to Focus Media Holding Limited Securities, Claims Administrator, c/o A.B. Data, Ltd., PO Box 170500, Milwaukee, WI 53217-8091, or by visiting www.FocusMediaSettlement.com DO NOT TELEPHONE THE COURT, THE CLERK'S OFFICE OR ANY OF THE DEFENDANTS OR COUNSEL FOR THE DEFENDANTS REGARDING THIS NOTICE. DATED: MAY 19, 2014 BY ORDER OF THE COURT UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK FORD MOTOR: Plaintiff's Expert Can Testify in F250 Switch Suit -------------------------------------------------------------- Amaris Elliott-Engel, writing for The National Law Journal, reports that a plaintiffs' expert is qualified to testify about whether the deactivation switch in a Ford F250 truck was negligently designed, the South Carolina Supreme Court has ruled. The high court's ruling reverses a finding by the intermediate appellate court that a $41,000 products liability verdict should be overturned and the trial court should have granted a directed verdict. Plaintiffs 5 Star Inc., is a lawn maintenance and pressure washing company owned by Stan Shelby. Nine years ago, 5 Star purchased a used 1996 Ford F-250 pickup up truck, which Mr. Shelby parked one weekend in his company's warehouse. During the weekend, a fire destroyed the truck and severely damaged the warehouse. A fire investigator determined that the engine compartment of the truck was the likely origin of the conflagration. According to Justice John Kittredge's opinion, the plaintiffs' expert testified that the deactivation switch was designed to be constantly on even when the ignition was off; the two-ampere fuse switch was protected by a 15-ampere fuse, allowing the switch to overheat and start a fire long before the fuse would ever blow; and the switch was separated only by a thin membrane from the flammable hydraulic brake fluid. Plaintiffs' expert Leonard Greene is a licensed electrical engineer who has testified about the origin of fires, electrical engineering and defective products between 50 and 100 times for both plaintiffs and defendants. Mr. Greene was qualified as an expert because he has "worked for companies that designed component parts -- such as integrated circuits and timers -- for use in vehicles. Additional manufacturers have hired Mr. Greene to determine the cause and origin of fires in boats, buses and other large commercial vehicles. Moreover, Mr. Greene has investigated a number of fires caused by the deactivation switch in Ford vehicles, including reviewing the relevant scientific literature," Justice Kittredge wrote. Ford Motor Co. argued that 5 Star offered no direct evidence that Ford admitted its design for the activation switch was negligent. "To require an admission of a design defect by a manufacturer as a prerequisite for a negligence claim is not only contrary to law, but also is at odds with the policy of encouraging manufacturers to design products safely based on well-understood principles of safety and science," Justice Kittredge wrote. "The design defect involving the deactivation switch is grounded in basic science, which, according to Ford's expert, is known to high school science students and, we think, should have been known to Ford engineers. A manufacturer may to avoid negligence liability by turning a blind-eye to the obvious." FRONTLINE ASSET: Faces "Ashikenazi" Suit Alleging FDCPA Violation ----------------------------------------------------------------- Sarah Ashikenazi, on behalf of herself and all others similarly situated v. Frontline Asset Strategies, LLC, and John Does 1-25, Case No. 3:14-cv-03851-PGS-TJB (D.N.J., June 16, 2014), alleges violations of the Fair Debt Collection Practices Act. The Plaintiff is represented by: Ari Hillel Marcus, Esq. MARCUS LAW LLC 1500 Allaire Avenue, Suite 101 Ocean, NJ 07712 Telephone: (732) 660-8169 E-mail: ari@marcuslawyer.com GC SERVICE: Violates Fair Debt Collection Act, Class Suit Says -------------------------------------------------------------- Steven Roth, a/k/a Yonah Roth, on behalf of himself and all other similarly situated consumers v. GC Service Limited Partnership, Case No. 1:14-cv-03752 (E.D.N.Y., June 15, 2014), alleges violations of the Fair Debt Collection Practices Act. The Plaintiff is represented by: Maxim Maximov, Esq. MAXIM MAXIMOV, LLP 1701 Avenue P Brooklyn, NY 11229 Telephone: (718) 395-3459 Facsimile: (718) 408-9570 E-mail: m@maximovlaw.com GENERAL MOTORS: "Andrews" Suit Seeks $10 Billion in Claims ---------------------------------------------------------- A federal class action filed on June 18, 2014, claims General Motors owes car- and truck-owners $10 billion for defects it hid for years, which will reduce the vehicles' resale value, according to Courthouse News Service. GM has recalled more than 20 million vehicles for safety defects this year, many of them for an ignition switch defect that has been linked to at least a dozen deaths. This defect is not part of the class action, which mentions more than a dozen other alleged defects for vehicles purchased from July 10, 2009, through April 1 this year. The lawsuit claims that the hidden defects have reduced as many as 15 million vehicles' resale values by $500 to $2,600 each. Lead plaintiff Anna Andrews is represented by: Elaine T. Byszewski, Esq. HAGENS BERMAN SOBOL SHAPIRO LLP 301 North Lake Avenue, Suite 203 Pasadena, CA 91101 Telephone: (213) 330-7150 Facsimile: (213) 330-7152 E-mail: elaine@hbsslaw.com GENERAL MOTORS: "Heuler" Suit Consolidated in Ignition Switch MDL ----------------------------------------------------------------- The class action lawsuit titled Nicole Heuler v. General Motors LLC, Case No. 8:14-cv-00492, was transferred from the U.S. District Court for the Central District of California to the U.S. District Court for the Southern District of New York. The New York District Court Clerk assigned Case No. 1:14-cv-04345-JMF to the proceeding. The Judicial Panel on Multidistrict Litigation transferred the lawsuit for coordinated or consolidated pretrial proceedings in the multidistrict litigation captioned In Re: General Motors LLC Ignition Switch Litigation, MDL No. 1:14-md-02543-JMF. The litigation arises from alleged deadly defect in the design of GM vehicles. The alleged defect is in the cars' ignition switch system, which is susceptible to failure during normal driving conditions. When the ignition switch system fails, the switch turns from the "run" or "on" position to either the "off" or "accessory" position, which results in a loss of power, speed control, and braking, as well as a disabling of the car's airbags. GM subsequently recalled the affected vehicles. The Plaintiff is represented by: Elaine T. Byszewski, Esq. HAGENS BERMAN SOBOL SHAPIRO LLP 1918 Eighth Avenue, Suite 3300 Seattle, WA 98101 Telephone: (206) 623-7292 Facsimile: (206) 623-0594 E-mail: elaine@hbsslaw.com - and - Mark P. Robinson, Jr., Esq. Scot D. Wilson, Esq. ROBINSON CALCAGNIE ROBINSON SHAPIRO DAVIS INC. 19 Corporate Plaza Drive Newport Beach, CA 92660 Telephone: (949) 720-1288 Facsimile: (949) 720-1292 E-mail: mrobinson@rcrlaw.net swilson@rcrlaw.net The Defendant is represented by: Jeffrey S. Sinek, Esq. KIRKLAND AND ELLIS LLP 333 South Hope Street, Suite 2900 Los Angeles, CA 90071 Telephone: (213) 680-8400 Facsimile: (213) 680-8500 E-mail: jeff.sinek@kirkland.com GENERAL MOTORS: "Ratzlaff" Suit Included in Ignition Switch MDL --------------------------------------------------------------- The class action lawsuit captioned Daniel Ratzlaff, et al. v. General Motors LLC, Case No. 2:14-cv-02424, was transferred from the U.S. District Court for the Central District of California to the U.S. District Court for the Southern District of New York (Foley Square). The New York District Court Clerk assigned Case No. 1:14-cv-04346-JMF to the proceeding. The Judicial Panel on Multidistrict Litigation transferred the lawsuit for coordinated or consolidated pretrial proceedings in the multidistrict litigation captioned In Re: General Motors LLC Ignition Switch Litigation, MDL No. 1:14-md-02543-JMF. The litigation arises from alleged deadly defect in the design of GM vehicles. The alleged defect is in the cars' ignition switch system, which is susceptible to failure during normal driving conditions. When the ignition switch system fails, the switch turns from the "run" or "on" position to either the "off" or "accessory" position, which results in a loss of power, speed control, and braking, as well as a disabling of the car's airbags. GM subsequently recalled the affected vehicles. The Plaintiffs are represented by: Kevin Frank Calcagnie, Esq. Mark P. Robinson, Jr., Esq. Scot D. Wilson, Esq. ROBINSON CALCAGNIE ROBINSON SHAPIRO DAVIS INC. 19 Corporate Plaza Drive Newport Beach, CA 92660 Telephone: (949) 720-1288 Facsimile: (949) 720-1292 E-mail: kcalcagnie@rcrlaw.net mrobinson@rcrlaw.net swilson@rcrlaw.net - and - Elaine T. Byszewski, Esq. HAGENS BERMAN SOBOL SHAPIRO LLP 301 North Lake Avenue, Suite 203 Pasadena, CA 91101 Telephone: (213) 330-7150 Facsimile: (213) 330-7152 E-mail: elaine@hbsslaw.com The Defendant is represented by: Jeffrey S. Sinek, Esq. KIRKLAND AND ELLIS LLP 333 South Hope Street, Suite 2900 Los Angeles, CA 90071 Telephone: (213) 680-8400 Facsimile: (213) 680-8500 E-mail: jeff.sinek@kirkland.com GENERAL MOTORS: No Ignition Claims Filed vs Trust Thru May 19 ------------------------------------------------------------- Through May 19, 2014, no Plaintiff has asserted a claim against Motors Liquidation Company GUC Trust in connection with the Class Actions related to its ignition-switch-related recalls, according to the GUC Trust's May 19, 2014, Form 8-K filing with the U.S. Securities and Exchange Commission. On May 16, 2014, the Bankruptcy Court for the Southern District of New York (the "Court") issued a scheduling order with respect to a number of issues relating to a motion filed by General Motors Company (together with its consolidated subsidiaries, "New GM") in which the GUC Trust has appeared as a party in interest. In its quarterly report on Form 10-Q filed April 24, 2014 (the "New GM Form 10-Q"), New GM disclosed that since the beginning of 2014, New GM had recalled approximately 2.6 million vehicles to repair ignition switches or to fix ignition lock cylinders and an additional 4.4 million vehicles to address certain electrical and other safety concerns. In addition, as disclosed in its current report on Form 8-K filed May 15, 2014, New GM subsequently announced five new safety recalls relating to additional defects, affecting approximately 2.7 million vehicles. Many of the vehicles affected by the foregoing recalls were manufactured or sold prior to July 10, 2009, the date that Motors Liquidation Company (formerly General Motors Corporation) sold substantially all of its assets to New GM pursuant to the provisions of Section 363(b) of Chapter 11 of the United States Bankruptcy Code (the "Closing Date"). In the New GM Form 10-Q, New GM also disclosed that 55 putative class actions had been filed by various plaintiffs (the "Plaintiffs") against New GM seeking compensatory damages for economic losses allegedly resulting from the ignition-switch- related recalls or the underlying condition of the vehicles covered by those recalls (the "Ignition Switch Issue"). Since the date of that quarterly report, additional putative class actions have been filed against New GM relating to the Ignition Switch Issue (together, with the above-described lawsuits, the "Class Actions"). The claims of many of the putative Class Actions may be overlapping, and to date, such actions have not been consolidated. The Judicial Panel on Multidistrict Litigation scheduled a May 29, 2014 hearing to determine whether to consolidate and transfer the Class Actions filed in federal courts for coordinated and consolidated pretrial proceedings. On April 21, 2014, New GM filed a motion with the Court seeking to enforce the Sale Order and Injunction, entered on July 5, 2009 (the "Sale Order"), approving the sale of substantially all of the assets of General Motors Corporation ("Old GM," and subsequently known as Motors Liquidation Company) to New GM pursuant to Section 363(b) of Chapter 11 of the United States Bankruptcy Code, which incorporates the terms of the Master Sale and Purchase Agreement, dated July 10, 2009 (the "MSPA"), by and among Old GM, certain of its debtor subsidiaries, and New GM. Under the terms of the Sale Order and the MSPA, all product liability and property damage claims arising from accidents or incidents prior to the Closing Date are to remain with Old GM as general unsecured claims. The GUC Trust has appeared in the proceedings in the Bankruptcy Court as an interested party. On May 16, 2014, the Court entered the Scheduling Order identifying a number of "threshold issues" for its resolution, including whether a fraud on the Court was committed in connection with the Sale Order in respect of the Ignition Switch Issue and whether any or all of the claims asserted in the Class Actions are claims against Old GM and/or the GUC Trust. The GUC Trust intends to vigorously defend its position that none of the claims of the Plaintiffs may be properly asserted against Old GM or the GUC Trust. As disclosed on September 16, 2009, the Court entered the bar order (the "Bar Order"), setting November 30, 2009, as the bar date for filing proofs of claims related to all general unsecured claims against Old GM and, following the passage of the effective date of Old GM's Second Amended Joint Chapter 11 Plan dated March 18, 2011 (the "Plan"), the GUC Trust. To date, no Plaintiff has asserted a claim against the GUC Trust in connection with the Class Actions. In any event, however, the Scheduling Order provides that the threshold issues do not include whether any claims in the Class Actions are timely or meritorious as against the bankruptcy estate of Old GM or the GUC Trust (notwithstanding the Bar Order). GENERAL MOTORS: Recalls About 510,000 Camaros Over Faulty Keys -------------------------------------------------------------- Danielle Ivory and Benjamin Preston, writing for The New York Times, report that General Motors is recalling more than half a million Chevrolet Camaros because of the danger that a bump to the keys could suddenly turn off the ignition -- a problem similar to the defect that led the automaker to recall millions of small cars this year. G.M. said that a driver's knee could jostle the key fob, causing the ignition to turn off and cutting the engine. The automaker said it was aware of three crashes and four injuries related to the defect, which is in about 510,000 Camaros worldwide from the 2010 to 2014 model years. The announcement struck a familiar note at G.M., which has been reeling from its decade-long failure to fix a different faulty ignition system that it has linked to at least 13 deaths and 54 crashes. In February, the automaker started recalling 2.6 million Chevrolet Cobalts, Saturn Ions and other small cars, citing a similar problem: If their keys were bumped or jostled, their engines could turn off, disabling critical systems like steering, brakes and air bags. The National Highway Traffic Safety Administration has received at least 210 complaints about the Camaros, and at least 21 of them mentioned unexpected stalling or power loss, according to a New York Times review of the agency's database. But G.M. was careful to distinguish between the two cases. "The Camaro ignition system meets all G.M. engineering specifications and is unrelated to the ignition system used in Chevrolet Cobalts and other small cars included in the ignition switch recall," G.M. said in a statement. In the Cobalt ignition, a spring inside the switch was too weak, making the key prone to turn to the "accessory" or "off" position. In the Camaro's case, the problem is with the key fob, according to G.M. The key works like a switchblade, popping out of the fob with the push of a button. If a driver bumps the fob while the car is running, the key can be turned, switching off the engine and disabling the air bags. But a G.M. spokesman, Alan Adler, said the company was not sure if the injuries in the Camaros were tied to the air bags. Air bags did not deploy in crashes that caused each of the 13 deaths from the previous ignition problem. Chris Caruso, an engineer for G.M. and its parts supplier Delphi from 1979 to 2006, who now works as a safety consultant in litigation involving air bag issues, said that because the volume of Camaros sold is low, accidents from the ignition defect are less likely to occur. But, he added, when they do, they are "usually catastrophic." Drivers began lodging complaints about stalling with the safety agency as early as May 2010, when a driver of a 2010 model described several instances when his moving car went dead, including once while he was driving on the freeway at about 70 miles per hour. "This car is dangerous to drive," he said. "Will I have a head-on collision while trying to pass another car?" Another complaint came from the owner of a 2012 Camaro. "When the ignition switch key is slightly bumped with knee, the car shuts off," the owner wrote to regulators in May. "Three times now. Dealership is not responsive. Taught my teen drivers what to do if this happens, and this saved my daughter's life when it happened to her." Another driver of the 2010 model complained to safety regulators in August 2013 that the car "completely shut off on me on a major highway." After the car had stalled multiple times, the driver took it to a dealer, who could find no problems with it. "I am very upset but very thankful that my two children were not with me when it happened," the driver said, adding that he was worried that the car could stall at night and other drivers would not be able to see him on the road. "The thought of that completely scares me," he said. Drivers also filed complaints about basic issues with the Camaro's ignition that were eerily reminiscent of similar problems in the Cobalt. In November 2010, one driver told regulators that his car not only stalled but often failed to start. He also said that one time, he was "unable to remove the key from the ignition." G.M. said that it had found the problem during internal testing it conducted after the recall of 2.6 million vehicles this year and that it would fix the problem by replacing the key with a type that had a separate fob, changing its shape to keep it out of the way. The automaker has made broad changes to its safety practices as the recall crisis has grown. It has hired a team of product investigators to examine consumer complaints and warranty claims for potential problems in vehicles. It has also appointed a new vice president for global product safety, Jeff Boyer. "Discovering and acting on this issue quickly is an example of the new norm for product safety at G.M.," Mr. Boyer said in a statement on Friday. G.M. has paid a high price for its inaction on the original switch defect. Last month, safety regulators levied a $35 million penalty, the maximum allowed, in addition to imposing oversight on its safety practices for failing to report the original switch defect in a timely manner. G.M. recently released the results of an internal investigation by a former United States attorney, Anton R. Valukas, that revealed what its chief executive, Mary T. Barra, called "a pattern of incompetence and neglect" at G.M. On June 11, Ms. Barra is scheduled to appear for the second time before a House subcommittee investigating G.M.'s inaction over the original ignition problem. Over the past decade, the issue of stalling was seen by G.M.'s engineers as an inconvenience rather than a safety risk, according to the company's recent internal probe. By 2004, the company's engineers had already received numerous reports of moving stalls caused by the ignition switch defect, the internal report said, but concluded that this kind of stalling was not a safety issue because drivers could still maneuver the cars. "G.M. personnel viewed the switch problem as a 'customer convenience' issue -- something annoying but not particularly problematic -- as opposed to the safety defect it was," the report said. In recent months, G.M. has issued recalls of more than 14 million vehicles in the United States, a single-year record for the company. "It's as if they are clearing out a backlog of old safety problems," said Allan Kam, who served as a senior enforcement lawyer for the National Highway Traffic Safety Administration for more than 25 years before he retired in 2000. "Because the problem is so similar to that of the Cobalt, you can't help but think that it might have gotten some increased attention at G.M. in recent weeks." GENERAL MOTORS: Lawmakers to Scrutinize Recall Probe Findings ------------------------------------------------------------- Marcy Gordon, writing for The Associated Press, reports that lawmakers were likely to express skepticism about some findings of a General Motors' investigation into its mishandled recall of 2.6 million small cars. CEO Mary Barra was set to appear before Congress on June 18. According to a congressional aide, members were expected have more questions about how much Ms. Barra knew about a problem with the ignition switches in the cars when she was GM product development chief. Ms. Barra said in previous testimony in April that she first learned of the problem late last year. The GM report exonerated Ms. Barra and other top executives. The aide requested anonymity because the questions haven't been made public. Former U.S. Attorney Anton Valukas, who was hired by GM to do the investigation, will also testify. Panel members were set to question Mr. Valukas on his conclusions that a lone engineer, Ray DeGiorgio, was able to approve the use of a switch that didn't meet company specifications, and years later, to order a change to that switch without anyone else at GM being aware, the congressional aide said. The panel's own investigation turned up evidence that at least five other GM employees were aware that Mr. DeGiorgio ordered the company that made the part to change the switch, the aide said. Ms. Barra was expected to tell lawmakers that she's taken steps to fix GM in the wake of the small car recall. She authorized a companywide safety review that has led to more than 40 recalls this year that cover almost 18 million cars in the U.S. GM has said that more are possible. Here are some other questions lawmakers were likely to ask Ms. Barra and Mr. Valukas: BARRA Q: How does GM plan to change the cumbersome corporate culture laid bare by Valukas's report? Mr. Valukas' investigation found that a pattern of incompetence and neglect within GM kept the ignition switch problem concealed for 11 years. Rep. Diana DeGette of Colorado, the senior Democrat on the Energy and Commerce investigative subcommittee, said this week she wants to know "what are they going to do to break this culture." Ms. Barra has acknowledged that the report drew a "deeply troubling" portrait of GM as an organization. According to her prepared remarks, Ms. Barra was set tell the hearing that GM has restructured its process for making safety decisions "to raise it to the highest levels of the company," among a number of changes. Q: How will GM compensate victims of crashes linked to the faulty switches? Ms. Barra says the company expects to begin processing victims' claims for compensation by Aug. 1. Lawmakers want details. GM has hired attorney Kenneth Feinberg to put a plan in place; he'll rule on who is eligible to receive compensation and will set the amounts. More than 300 claims have been filed. Mr. Feinberg has presided over compensation plans for the victims of the Sept. 11 terrorist attacks, the 2010 BP oil spill in the Gulf of Mexico and other disasters. Q: Could the seeds of an even wider problem be lurking within GM's corporate structure? Ms. Barra has said that the safety review is nearly complete and hasn't turned up any other serious problems. She called the ignition-switch debacle a "unique series of mistakes" made by the company over many years. The news on June 16 of another huge recall for a problem similar to the ignition-switch defect has fueled lawmakers' skepticism. "This latest recall raises even more questions about just how pervasive safety problems are at GM," Rep. Fred Upton, R-Mich., chairman of the Energy and Commerce Committee, said. VALUKAS Q: How bad were the problems at GM. He and his team know GM thoroughly after interviewing 230 employees and reviewing 41 million documents. Mr. Valukas will tell the hearing that his team found an alarming "lack of urgency" among GM employees to fix the switches, magnified by a dysfunctional corporate structure. He acknowledges that his report leaves open some questions, notably: whether there was civil and criminal culpability; whether GM will make the right decisions to stop this from happening again; and what specific crashes were caused by the ignition switch problem. Q: Do the actions that GM has taken so far appear sufficient? In addition to making organizational changes, the company forced out 15 employees and disciplined five others for their roles in the ignition-switch debacle. More than half the 15 were senior legal and engineering executives who failed to disclose the defect and were part of a "pattern of incompetence," according to Ms. Barra. The Justice Department likely will use Mr. Valukas' findings as a "road map" for questions and employees to pursue in its criminal investigation. * * * Marcy Gordon, writing for The Associated Press, reports General Motors is the subject of multiple government investigations and civil lawsuits for taking more than a decade to recall 2.6 million cars with a deadly ignition switch defect. On June 18, GM CEO Mary Barra was set to appear for the second time before a U.S. House subcommittee to discuss the company's internal investigation into the recall. Here are 10 key events in the recall saga: February 2002: GM switch engineer Ray DeGiorgio approves the design of a new small-car ignition switch, even though the supplier says the switch doesn't meet GM's specifications. The switch goes into the Saturn Ion in late 2002. Later, it's used for the Chevrolet Cobalt, Pontiac G5, Chevrolet HHR, Pontiac Solstice and Saturn Sky. July 29, 2005: Amber Marie Rose, 16, dies in a frontal crash in her 2005 Chevrolet Cobalt, the first of 13 deaths GM says were caused by the defective switches. A contractor hired by NHTSA found that the Cobalt's ignition had moved out of the "run" position and into the "accessory" position, which cut off power to the steering, brakes and air bags. April 2006: Mr. DeGiorgio signs off on a redesign of the ignition switch, but doesn't change the part number, which will make the change difficult to track later. The new switch goes into cars from the 2007 model year and later. November 2007: The National Highway Traffic Safety Administration declines to open a formal investigation into why air bags didn't deploy in some Cobalt and Ion crashes, saying the incidence rate doesn't appear to be higher than peer vehicles. April 2013: During depositions in a wrongful death case in Georgia, GM is shown evidence that Mr. DeGiorgio changed the switch design. In November, GM engineers finally confirm that the design was changed. December 2013: Incoming CEO Mary Barra learns about the defective ignition switches. February 2013: In two separate actions, GM recalls 1.6 million small cars to repair defective ignition switches. The recall later grows to 2.6 million cars. The company says it expects to repair all of the vehicles by October. April 1-2 - Ms. Barra and NHTSA acting chief David Friedman testify before Congressional committees. Ms. Barra says GM has hired compensation expert Kenneth Feinberg, but defers many questions until after the company has completed its internal report. May 16 - The U.S. government fines GM a record $35 million for failing to disclose the problems more quickly. GM agrees to report safety problems faster and consents to government oversight of its safety operations. June 6 - Ms. Barra releases a 315-page investigation into the recalls by former U.S. attorney Anton Valukas, who was hired by the company. Ms. Barra says 15 employees have been dismissed and another five have been disciplined. She says GM will have a compensation fund for victims that will begin taking claims on Aug. 1. GEORGIA: "R. A." Class Suit Filed Over Prison Condition ------------------------------------------------------- R. A., Individually and on Behalf of All Others Similarly Situated v. Commissioner Avery Niles; Commissioner L. Gale Buckner; Commissioner Amy Howell; Sarah Draper, Deputy Commissioner; Clay Seabolt, Deputy Commissioner; Michael McNeely, Deputy Commissioner; Miguel Fernandez, Deputy Commissioner; Director Martha Dalesio; Lieutenant Brown; Officer Gabriel Lasiter; Officer Kasey Brightmon; Officer Larry Floyd; Lieutenant Sherill Swanson; Officer Demetrius Monts; Officer Larry Bennett; Director Shawn Banks; Director Corey Butler; Jane Doe 1; and Jane Doe 2, Case No. 1:14-cv-01870-TWT-LTW (N.D. Ga., June 15, 2014), arises from claims over prison condition. The Plaintiff asserts prisoner civil rights. The Plaintiff is represented by: Demetra Duan Ford, Esq. FORD LAW, LLC 931 Monroe Drive, NE Atlanta, GA 30308 Telephone: (404) 392-5500 E-mail: fordesq@yahoo.com - and - James Darren Summerville, Esq. S. Leighton Moore, Esq. SUMMERVILLE MOORE, P.C. 400 Colony Square, Suite 2000 1201 Peachtree Street, NE Atlanta, GA 30361 Telephone: (770) 635-0030 Facsimile: (770) 635-0029 E-mail: darren@summervillemoore.com leighton@summervillemoore.com - and - Sherida Nicole Jones, Esq. Thomas G. Sampson, Esq. Thomas Gatewood Sampson, II, Esq. THOMAS KENNEDY SAMPSON & TOMPKINS, LLP 3355 Main Street Atlanta, GA 30337 Telephone: (404) 688-4503 E-mail: s.jones@tkstlaw.com t.sampson@tkstlaw.com w.sampson@tkstlaw.com GLADE KNIGHT: Faces Securities Suit by Apple REIT Shareholder ------------------------------------------------------------- Dorothy Wenzel on behalf of herself and all others similarly situated v. Glade M. Knight, Michael S. Waters, Robert M. Wily, James C. Barden, Justin Knight, David McKenney, Kristian Gathright, Bryan Peery, Kent Colton, Glenn W. Bunting, Lisa B. Kern, Apple Seven Advisors, Inc., Apple Eight Advisors, Inc. and Apple Fund Management, LLC, Case No. 3:14-cv-00432-REP (E.D. Va., June 16, 2014), is a shareholder class action asserting claims on behalf of the pre-merger public common shareholders of Apple REIT Eight., Inc., and Apple REIT Seven, Inc., arising out of A-7 and A-8 dividend reinvestment plans. The Individual Defendants are directors and officers of the Apple REITs. Apple Seven Advisors, Inc., a Virginia corporation wholly owned by Glade M. Knight, is the adviser to A-7. Apple Eight Advisors, Inc., a Virginia corporation wholly owned by Glade M. Knight, is the adviser to A-8. Apple Fund Management, LLC, a wholly owned subsidiary of Apple REIT Six, Inc., was an entity utilized by the advisers, which have no employees, to provide the management services, including the executive officers, required by the advisory contracts to, inter alia, A-6, A-7, A-8, and Apple REIT Nine, Inc. The Plaintiff is represented by: Jeffrey Hamilton Geiger, Esq. SANDS ANDERSON PC 1111 East Main Street, Suite 2400 P.O. Box 1998 Richmond, VA 23218-1998 Telephone: (804) 783-7248 Facsimile: (804) 783-7291 E-mail: jgeiger@sandsanderson.com - and - Lee Squitieri, Esq. Raymond Barto, Esq. SQUITIERI & FEARON, LLP 32 East 57th Street, 12th Floor New York, NY 10022 Tel: (212) 421-6492 Fax: (212) 421-6553 E-mail: lee@sfclasslaw.com raymond@sfclasslaw.com - and - Daniel R. Lapihski, Esq. Kevin P. Roddy, Esq. WILENTZ, GOLDMAN & SPITZER P.A. 90 Woodbridge Center Drive Woodbridge, NJ 07095 Telephone: (732) 855-6066 Facsimile: (732) 726-4735 E-mail: dlapinski@wilentz.com kroddy@wilentz.com GLOBAL TEL-LINK: Accused of Violating Telecommunications Act ------------------------------------------------------------ Brandy Brink, on behalf of herself and all others similarly situated v. Global Tel-Link, Case No. 0:14-cv-01952-ADM-FLN (D. Minn., June 17, 2014), is brought under the Telecommunications Act of 1996. The Plaintiff is represented by: Raina Borrelli, Esq. Daniel E. Gustafson, Esq. GUSTAFSON GLUEK PLLC 120 South 6th Street, Suite 2600 Minneapolis, MN 55402 Telephone: (612) 333-8844 Facsimile: (612) 339-6622 E-mail: rborrelli@gustafsongluek.com dgustafson@gustafsongluek.com GRAIN PROCESSING: Iowa Supreme Court Reinstates Pollution Suit -------------------------------------------------------------- Ryan J. Foley, writing for The Associated Press, reports that in a major environmental case, the Iowa Supreme Court ruled on June 13 that residents can bring a nuisance lawsuit against a Muscatine manufacturer accused of routinely blanketing their properties with soot and chemicals. The court reinstated the class-action lawsuit against Grain Processing Corp., which operates a plant that turns corn kernels into products ranging from corn syrup to ethyl alcohol. The plaintiffs' claims of nuisance, negligence and trespass are not barred by the federal Clean Air Act or state rules governing air emissions, Justice Brent Appel wrote in a 6-0 decision that was applauded by environmentalists but criticized by business interests. A regional economic force, the company buys $400 million in corn from farmers annually and is one of the area's largest employers. But Muscatine residents have complained for years that it spews harmful chemicals into the environment that get blown onto their homes, yards and cars. The lawsuit, filed on behalf of up to 17,000 residents who live within a 3-mile radius of the plant, contends the pollution undermines their ability to enjoy their property and causes metals in everything from swing sets to air conditioning systems to corrode. The company and a coalition of business groups had urged the court to dismiss the case, saying the regulation of air pollution should be left to state and federal agencies and not judges on a case-by- case basis. But the plaintiffs, environmental groups and advocates for private property rights had asked the court to allow the lawsuit to proceed. "The important thing is that it protects regular folks' remedies when they are impacted by environmental pollution," Joshua Mandelbaum, an attorney with the Environmental Law & Policy Center in Des Moines, said of the June 13 ruling. But Richard Faulk, a Washington D.C. attorney who represented the National Association of Manufacturers and other business groups, said the decision means that corporations can be sued for pollution even when they are operating in compliance with state and federal air permits. "It's a very troubling problem for companies," he said. Judge Mark Smith dismissed the case before trial last year. He said that even if half of the plaintiffs' claims about the company's practices were true, "there has been blatant disregard for the environment and the community of Muscatine." But he said that enforcement of the Clean Air Act and state regulations was the proper way to remedy such problems. "When an individual's rights to seek damages for economic or physical harm conflict with the economic well-being of a local employer, those rights must be carefully weighed and reconciled through political compromises achieved by the legislative and rule-making processes," he wrote. The business groups argued that courts don't have the expertise to decide complicated scientific questions, and those should be left to regulators and lawmakers. Having clear state and federal rules allows businesses to make plans and investments without worrying about the "uncertain, unpredictable and potentially unbearable liabilities" that may arise from private lawsuits, they wrote in a friend-of-the-court brief. But in the June 13 ruling, Justice Appel said the regulations serve a different purpose than a private lawsuit for an individual's injury. "The nuisance and common law actions in this case are based on specific harms to the use and enjoyment of real property that are different from the public interest generally in controlling air pollution," he wrote. Company spokeswoman Janet Sichterman said it was disappointed in the decision but confident it would prevail on the merits of the case. The company paid a $1.5 million fine in March to settle a lawsuit brought by Iowa Attorney General Tom Miller over alleged air pollution violations. The company will convert its coal-fired boilers to run on natural gas by next year, and is spending $100 million to build a new dryer house to reduce emissions. The company says those changes should eliminate the smoke, odor and haze coming from the plant. HALAL CHINA: Faces "Alejandro" Suit Alleging Violations of FLSA --------------------------------------------------------------- Bazan Alejandro, On Behalf of Himself and On Behalf of All Others Similarly Situated v. Halal China King and Taisun Tsaou, Case No. 4:14-cv-01686 (S.D. Tex., June 17, 2014), is brought pursuant to the Fair Labor Standards Act. The Plaintiff is represented by: Michael Todd Slobin, Esq. SHELLIST LAZARZ SLOBIN LLP 11 Greenway Plaza, Suite 1515 Houston, TX 77046 Telephone: (713) 621-2277 E-mail: tslobin@eeoc.net HULU: Court Refused to Certify Users Class in Privacy Litigation ---------------------------------------------------------------- A group of Hulu users who claim the website illegally shared their data with third parties cannot sue as a class for Hulu's disclosure of information via Facebook "likes," reports Nick McCann at Courthouse News Service, citing a ruling by a federal magistrate judge. Joseph Garvey is lead plaintiff in "Hulu Privacy Litigation" which claims Hulu "repurposed" its browser cache to let marketing- analysis services store users' private data. Hulu disputes the claims that it used the analytics service comScore and Facebook "like" buttons to store user data. Much of the litigation has focused on alleged violations of the federal Video Privacy Protection Act (VPPA), enacted in 1988 after a Washington D.C. newspaper published the video-rental history of Supreme Court nominee Robert Bork. In December 2013, U.S. Magistrate Judge Laurel Beeler found the VPPA "requires only injury in the form of a wrongful disclosure." "Hulu's main argument -- that the word 'aggrieved' in the statute requires an additional injury -- does not change the outcome," Beeler wrote. In April, Beeler partly granted and partly denied Hulu's request for summary judgment, saying the issue at hand depends on whether Hulu's disclosure was "knowing." "Throwing Judge Bork's video watch list in the recycle bin is not a disclosure. Throwing it in the bin knowing that the Washington Post searches your bin every evening for intelligence about local luminaries might be," Beeler wrote in the order. "Considering the statute's reach, the conclusion is that Hulu's transmission of the Facebook user cookies needs to be the equivalent of knowingly identifying a specific person as 'having requested or obtained specific video materials or services.' "If Hulu did not know that it was transmitting both an identifier and the person's video watching information, then there is no violation of the VPPA. By contrast, if it did know what it was transmitting, then (depending on the facts) there might be a VPPA violation." Regarding the metrics company comScore, Beeler found the plaintiffs could not prove the company did anything with their information, and found for Hulu on that issue. "The evidence shows comScore's role in measuring whether users watched the advertisements. It also demonstrates comScore's interest in recognizing users and tracking their visits to other websites where comScore collects data," Beeler wrote. "That information is likely relevant to an advertiser's desire to target ads to them. It does not suggest any linking of a specific, identified person and his video habits." The plaintiffs moved to certify the class of users, claiming Hulu illegally used their Facebook "likes," and a hearing was held in May. In a new order on June 17, 2014, Beeler found the plaintiffs could not properly define a class because, among other things, "the claims apparently are not amenable to ready verification." "The court cannot tell how potential class members reliably could establish by affidavit the answers to the potential questions: do you log into Facebook and Hulu from the same browser; do you log out of Facebook; do you set browser settings to clear cookies; and do you use software to block cookies?" Beeler wrote. "The possibility of substantial pecuniary gain affects this analysis too. That incentive and the vagaries of subjective recollection makes this case different than the small-ticket consumer protection class actions that this district certifies routinely." Beeler denied the plaintiffs' motion for class certification for that reason. The judge addressed the plaintiffs' other arguments, finding that while they satisfied some elements needed for class certification, the evidence did not show that "common issues predominate over the individual ones." "Perhaps subclasses could address the use (or lack of use) of ad- blockers or browser technologies, or whether users stayed logged into Facebook. Plaintiffs have not proposed that subclassing," Beeler wrote. "Given that even the court's best guess at subclassing would not address the issues about ascertainability and identify the class members, the court finds on this record that common issues do not predominate." The consolidated case is In Re: Hulu Privacy Litigation, Case No. C 11-03764 LB, in the U.S. District Court for the Northern District of California, San Francisco Division. HUNTINGTON BANCSHARES: Faces Suit by Ohio Counties Over MERS ------------------------------------------------------------ Huntington Bancshares Incorporated continues to face a putative class action filed on behalf of counties in Ohio against MERSCORP, Inc. and numerous other financial institutions that participate in the mortgage electronic registration system (MERS), according to an Exhibit attached to Huntington's May 28, 2014, Form 8-K filing with the U.S. Securities and Exchange Commission. On January 17, 2012, the Company was named a defendant in a putative class action filed on behalf of all 88 counties in Ohio against MERSCORP, Inc. and numerous other financial institutions that participate in the mortgage electronic registration system (MERS). The complaint alleges that recording of mortgages and assignments thereof is mandatory under Ohio law and seeks a declaratory judgment that the defendants are required to record every mortgage and assignment on real property located in Ohio and pay the attendant statutory recording fees. The complaint also seeks damages, attorneys' fees and costs. Although Huntington has not been named as a defendant in the other cases, similar litigation has been initiated against MERSCORP, Inc. and other financial institutions in other jurisdictions throughout the country. IDENIX PHARMACEUTICALS: Being Sold for Too Little, Suit Claims -------------------------------------------------------------- Courthouse News Service reports that directors are selling Idenix Pharmaceuticals too cheaply through an unfair process to Merck, for $24.50 a share or $3.7 billion, shareholders claim in Delaware Chancery Court. INNOVATIVE DINING: Calif. Court Approves Class Action Settlement ---------------------------------------------------------------- Mark Anstoetter, Esq., and Madeleine McDonough, Esq., at Shook Hardy & Bacon LLP, report that a California state trial court has approved the settlement agreement in a class action against Innovative Dining Group LLC (IDG), owner of the Boa Steakhouse and Sushi Roku chains, alleging that the restaurants falsely advertised their menu as containing Kobe beef. Hall v. Innovative Dining Grp. LLC, No. BC493144 (Cal. Super. Ct., Los Angeles Cnty., motion granted May 30, 2014). Plaintiffs claimed that using the term "Kobe beef" implies that the beef came from Wagyu cattle raised and slaughtered in the Kobe region of Japan, but IDG's restaurants advertised Kobe beef on their menus even while the U.S. Department of Agriculture banned beef imports from that region from May 2010 to August 2012. While admitting no wrongdoing, IDG has agreed to issue $20 gift certificates to customers who can prove that they purchased a Kobe beef menu item, $10 gift certificates to any class member who submits a claim, and a $12,500 cy pres award to the Los Angeles Regional Food Bank. The settlement follows similar lawsuits against Marriott International Inc., Barney's Beanery Worldwide Inc. and McCormick & Schmick's Seafood Restaurants Inc. IRENEW BIO: "Litwin" Suit Remanded for Further Proceedings ---------------------------------------------------------- Plaintiffs filed class action lawsuits against iRenew Bio Energy Solutions, LLC, Harvest Trading Group, Inc., and Harvest Direct, LLC (collectively defendants) for advertising a bracelet made by iRenew as a revolutionary bracelet that uses the body's "biofield" to improve strength and wellness. Alleging the advertising claims were false, plaintiffs sought injunctive relief and damages on behalf of all persons in the United States who purchased an iRenew bracelet. Defendants agreed to settle the lawsuit, and the trial court approved a settlement agreement in which defendants would create a fund to reimburse class members for the purchase cost of the bracelet. Pursuant to the agreement, the trial court awarded $215,000 in attorney fees. Appellant Burt Chapa, a class member, objected to the settlement, alleging the trial court abused its discretion in awarding attorney fees and the notice afforded class members violated due process. The Court of Appeals of California, Second District, Division One, in an opinion dated May 28, 2014, a copy of which is available at http://is.gd/T9QNTJfrom Leagle.com, disagreed with the first contention but agreed with the second. The order granting final approval of the settlement was reversed, and the case was remanded for further proceedings. On May 29, 2014, the Calif. Appeals Court issued a modified opinion, a copy of which is available at http://is.gd/R5N55nfrom Leagle.com, saying there is no change in judgment but on page 1, the asterisk footnote should be changed to read: Pursuant to California Rules of Court, rules 8.1100 and 8.1110, this opinion is certified for publication with the exception of parts 1 and 3 of the Discussion. The case is SERYL LITWIN, et al., Plaintiffs and Respondents, v. IRENEW BIO ENERGY SOLUTIONS, LLC, Defendant and Respondent; BERT CHAPA, Objector and Appellant, NO. B248759. For Objector and Appellant: Timothy R. Hanigan, Esq. Lang, Hanigan & Carvalho 21550 Oxnard St Woodland Hills, CA 91367 Telephone: (818) 348-9711 Kirtland & Packard, Michael Louis Kelly -- mlk@KirtlandPackard.com -- Behram V. Parekh -- bvp@KirtlandPackard.com -- Heather M. Baker -- hmp@KirtlandPackard.com -- for Plaintiffs and Respondents. Weintraub Tobin Law Corporation, David R. Gabor -- dgabor@weintraub.com -- for Defendant and Respondent. JPMORGAN CHASE: Has Initial OK of Mortgage Modification Suit Deal ----------------------------------------------------------------- District Judge Richard G. Stearns granted preliminary approval of a settlement agreement resolving IN RE JPMORGAN CHASE MORTGAGE MODIFICATION LITIGATION, NO. 1:11-MD-02290-RGS, (D. Mass.). A copy of the May 28, 2014 ruling is available at http://is.gd/u91dNcfrom Leagle.com. Judge Stearns preliminarily approved the Agreement as being fair, reasonable, and adequate, and preliminarily certified the "Settlement Class" defined as: "All mortgage loan borrowers whose loans are serviced by Chase (1) who participated in a Stated- Income Trial Period Plan ("TPP") extended by Chase under the Home Affordable Modification Program ("HAMP") and/or under other non- HAMP modification program, (2) who made the trial payments required by the TPP in accordance with then-governing Program Guidelines on timeliness and sufficiency, (3) whose subject property was not subject to a Completed Foreclosure after the borrower participated in a Stated-Income TPP, (4) for whom Chase either has not made a permanent loan modification eligibility decision since the start of the trial period described in the borrower's Stated-Income TPP, or made an eligibility decision denying the loan for permanent modification during or after the trial period described in the borrower's Stated-Income TPP, and (5) who, based on Declarations furnished to Plaintiffs on April 4, 2014 and April 7, 2014, did not receive the Primary Class Notice pursuant to the Primary Settlement Agreement in the Action, and therefore whose claims are not released as part of the Primary Settlement Agreement in the Action." The Court preliminarily and conditionally designated as Settlement Class Counsel the law firms of Klein Kavanagh Costello, LLP, Keller Rohrback L.L.P., Cuneo Gilbert & Laduca, LLP, and Levin, Fishbein, Sedran & Berman. The Court approved Kurtzman Carson Consultants, LLC as the Settlement Administrator. The Final Fairness Hearing will take place before the Honorable Richard G. Stearns at 2:00 p.m. on October 8, 2014, at the United States District Court, District of Massachusetts, Courtroom No. 21, John Joseph Moakley U.S. Courthouse, 1 Courthouse Way, in Boston, Massachusetts. In Re: JPMORGAN CHASE MORTGAGE MODIFICATION LITIGATION, In Re, represented by Leah M. Houghton, Morgan Lewis & Bockius LLP & Michael J. Agoglia, Morrison & Foerster LLP. Consolidated Plaintiffs, Plaintiff, represented by Gary E. Klein, Klein Kavanagh Costello, LLP, Gretchen Freeman Cappio, Keller Rohrback LLP, Gretchen S. Obrist, Keller Rohrback LLP, Jennifer E. Kelly, Cuneo Gilbert & Laduca, LLP, Jonathan W. Cuneo, Cuneo Gilbert & LaDuca, LLP, Lynn Lincoln Sarko, Keller Rohrback L.L.P., Ryan P. McDevitt, Keller Rehrback LLP, Sharon T Hritz, Keller Rohrback LLP, Alexandra C. Warren, Cuneo Gilbert & LaDuca, LLP, Charles M. Delbaum, National Consumer Law Center, Charles E. Schaffer, Levin, Fishbein, Sedran & Berman, Corinne Reed, Klein Kavanagh Costello, LLP, Eric D Holland, Holland Groves Schneller & Stolze LLC, Kevin Costello, Klein Kavanagh Costello, LLP, Leonard A. Bennett, Consumer Litigation Associates, P.C., Michael J. Flannery, Cuneo Gilbert & LaDuca, LLP, Randall Seth Crompton, Holland Groves Schneller and Stolze LLC & Shennan Alexandra Kavanagh, Klein Kavanagh Costello, LLP. AMY E. KELLER, Plaintiff, represented by Katrina Carroll, Lite DePalma Greenberg LLC. Christopher & Renee Jerram, Plaintiff, represented by Christine M. Craig, Shaheen & Gordon, P.A.. JPMorgan Chase Morgage Modification Litigation, Defendant, represented by Jami Wintz McKeon, Morgan, Lewis & Bockius, Michael J. Agoglia, Morrison & Foerster LLP, Donn A. Randall, Bulkley, Richardson & Gelinas, LLP, Leah M. Houghton, Morgan Lewis & Bockius LLP & Matthew A. Kane, Bulkley, Richardson & Gelinas, LLP. JPMorgan Chase Bank, N.A., Defendant, represented by Jami Wintz McKeon, Morgan, Lewis & Bockius, Michael J. Agoglia, Morrison & Foerster LLP, Wendy M. Garbers, Morrison & Foerster LLP, Donn A. Randall, Bulkley, Richardson & Gelinas, LLP, Leah M. Houghton, Morgan Lewis & Bockius LLP & Matthew A. Kane, Bulkley, Richardson & Gelinas, LLP. The Bear Stearns Companies LLC, Defendant, represented by Jami Wintz McKeon, Morgan, Lewis & Bockius, Donn A. Randall, Bulkley, Richardson & Gelinas, LLP, Leah M. Houghton, Morgan Lewis & Bockius LLP & Matthew A. Kane, Bulkley, Richardson & Gelinas, LLP. EMC Mortgage LLC, formerly known as EMC Mortgage Corporation, Defendant, represented by Jami Wintz McKeon, Morgan, Lewis & Bockius, Donn A. Randall, Bulkley, Richardson & Gelinas, LLP, Leah M. Houghton, Morgan Lewis & Bockius LLP & Matthew A. Kane, Bulkley, Richardson & Gelinas, LLP. Delano Cureton, Third Party Witness, represented by Jami Wintz McKeon, Morgan, Lewis & Bockius. Scott Keller, Third Party Witness, represented by Katrina Carroll, Lite DePalma Greenberg LLC. JUDGES' RETIREMENT: "Staniforth" Suit Ruling Partially Vacated -------------------------------------------------------------- Faye Staniforth filed an action, on behalf of herself and similarly situated persons (collectively pensioners), alleging numerous claims against the Judges' Retirement System (JRS). The principal claim raised by pensioners' action was that JRS had not adhered to its obligations to pensioners under Olson v. Cory (1980) 27 Cal.3d 532 (Olson I) and, as a result, pension payments stretching back over three decades had been underpaid to pensioners (Olson I claims). This action sought a declaratory judgment that, under Olson I, jurists who served on California's trial court or appellate court bench during the time Government Code section 68203 provided for unlimited cost of living adjustments (COLA's) were entitled to have their (or their surviving beneficiaries') pensions adjusted upward based on the applicable COLA for each year, and that the cap on the amount of COLA's (enacted by legislation that amended Section 68203 and took effect on January 1, 1977) could not constitutionally be applied to pensions earned by jurists who served on California's trial court or appellate court bench during the time that Section 68203 provided for unlimited COLA's. The petition also sought a writ of mandate compelling JRS to adhere to Olson I and to recalculate the amount of judicial pensions owed to pensioners using uncapped COLA's, and to pay arrearages and interest for the decades of underpaid pension payments. JRS demurred to pensioners' Olson I claims. JRS argued pensioners' Olson I claims were in direct conflict with a correct reading of Olson I and that, contrary to pensioners' claims, JRS had correctly applied the teaching of Olson I to these pensioners and had correctly calculated judicial pensions since Olson I. The trial court agreed and sustained JRS's demurrer to pensioners' Olson I claims without leave to amend. The court also denied pensioners' subsequent motion to vacate in part the order sustaining the demurrer to pensioner's Olson I claims without leave to amend and, after dismissing pensioners' remaining claims for failure to exhaust administrative remedies, entered judgment in favor of JRS. Pensioners appealed. On appeal, pensioners limit the claims of error to (1) the order sustaining JRS's demurrer to pensioner's Olson I claims without leave to amend, and (2) the court's denial of pensioners' subsequent motion, which in effect sought leave to amend to separately state (and thereby preserve) certain claims by certain pensioners. The propriety of the first order turns on an interpretation of the impact of Olson I, as amplified in both Olson v. Cory (1982) 134 Cal.App.3d 85 (Olson II) and Olson v. Cory (1983) 35 Cal.3d 390 (Olson III), on judicial pensions. The propriety of the second order involves distinct issues requiring a separate but interdependent analysis. In an opinion dated May 29, 2014, copy of which is available at http://is.gd/wm5gCwfrom Leagle.com, the Court of Appeals of California, Fourth District, Division One, directed the trial court to vacate its order denying pensioners' motion to partially vacate the order sustaining respondent's demurrer without leave to amend, and to enter a new and different order permitting pensioners leave to amend the complaint to separately state claims for alleged underpayment of pensions. In all other respects, the judgment was affirmed. The case is FAY STANIFORTH et al., Plaintiffs and Appellants, v. THE JUDGES' RETIREMENT SYSTEM, Defendant and Respondent; JOHN CHIANG, as State Controller, etc., Real Party in Interest and Respondent, NO. D064111. Jorn S. Rossi and Paul G. Mast for all Plaintiffs and Appellants except William Reppy, Jr. William Reppy, Jr., in pro. per. Reed Smith, Harvey L. Leiderman -- hleiderman@reedsmith.com -- and Jeffrey R. Rieger -- jrieger@reedsmith.com -- for Defendant and Respondent. No appearance for Real Party in Interest and Respondent. KAMERYCAH INC: Removed "Lee" Suit to C.D. Calif. ------------------------------------------------ The class action lawsuit styled Hye Seon Lee v. Kamerycah, Inc., et al., Case No. BC538866, was removed from the Los Angeles Superior Court to the U.S. District Court for the Central District of California. The District Court Clerk assigned Case No. 2:14- cv-04612-DMG-FFM to the proceeding. The Plaintiff is represented by: Young W. Ryu, Esq. LAW OFFICES OF YOUNG W. RYU 9595 Wilshire Boulevard, Suite 900 Beverly Hills, CA 90212 Telephone: (213) 260-0082 Facsimile: (800) 576-1170 E-mail: young.ryu@youngryulaw.com The Defendant is represented by: Timothy J. O'Connor, Esq. O'CONNOR & SCHMELTZER 8001 Irvine Center Drive, Suite 1550 Irvine, CA 92618-2936 Telephone: (949) 753-0700 Facsimile: (949) 753-8069 E-mail: tim.oconnor@osolawcorp.com - and - Robert H. Cherry, Esq. ROBERT H. CHERRY LAW OFFICES 8001 Irvine Ctr Dr, Suite 1575 Irvine, CA 92618 Telephone: (949) 753-1991 E-mail: rcherrylaw@aol.com KINDER STUFF: Teaching Staff Seeks to Recover Unpaid Wages ---------------------------------------------------------- Houaria Bensabeur, Sandra Gonzalez, Rose Heavens, Maria Herman, Sabine Jules, Yesenia Martinez, and Mercedes Montalvo, individually and on behalf of all others similarly situated v. Kinder Stuff 2010 LLC d/b/a Kinderstuff Daycare & Learning Centers and Mark Tress, Case No. 1:14-cv-03789 (E.D.N.Y., June 17, 2014), lawsuit seeks to recover unpaid wages owed to the Plaintiffs and other similarly situated employees, who were not properly paid for their work, in violation of federal and state wage and hour laws. The Plaintiffs and the proposed class members worked as teaching staff at various Kinder Stuff locations in Brooklyn, New York. Kinder Stuff 2010 LLC is a New York limited liability corporation headquartered in Brooklyn, New York. Kinder Stuff does business as Kinderstuff Daycare & Learning Centers operating six daycare centers in Brooklyn. Mark Tress is the controlling owner/shareholder of Kinder Stuff. The Plaintiffs are represented by: Steven M. Warshawsky, Esq. THE WARSHAWSKY LAW FIRM Empire State Building 350 Fifth Avenue, 59th Floor New York, NY 10118 Telephone: (212) 601-1980 Facsimile: (212) 601-2610 E-mail: smw@warshawskylawfirm.com - and - Sheila Y. Samuels, Esq. LAW OFFICE OF SHEILA SAMUELS 11 West Prospect Avenue, 3rd Floor Mount Vernon, NY 10550 Telephone: (914) 368-7680 Facsimile: (888) 421-7635 E-mail: infoaskesq@gmail.com - and - Tomasz J. Piotrowski, Esq. T.J. PIOTROWSKI LAW FIRM 176 Kent Street, Suite 2L Brooklyn, NY 11222 Telephone: (917) 612-0788 E-mail: tomjerzy@msn.com LA CONDESA CAFE: Sued Over Failure to Pay Overtime Compensation --------------------------------------------------------------- Marshall Hall v. La Condesa Cafe, Inc., a Arizona Corporation; Felipe and Christina Guzman, husband and wife; Case No. 2:14-cv- 01334-DGC (D. Ariz., June 16, 2014), is brought against the Defendants for their alleged unlawful failure to pay overtime wages in direct violation of the Fair Labor Standards Act. La Condesa Cafe, Inc. is incorporated in the state of Arizona with its principle place of business in Phoenix, Arizona. The Individual Defendants are owners of La Condesa Cafe, Inc. The Plaintiff is represented by: Trey Dayes, Esq. Sean Davis, Esq. PHILLIPS DAYES LAW GROUP PC 3101 North Central Avenue, Suite 1500 Phoenix, AZ 85012 Telephone: (602) 258-8900 Facsimile: (602) 288-1664 E-mail: treyd@phillipsdayeslaw.com seand@phillipsdayeslaw.com LIFE PARTNERS: Expects Discovery to Commence in Securities Suit --------------------------------------------------------------- Life Partners Holdings, Inc. anticipates that parties in a consolidated securities suit against it will now commence discovery after a denial by the U.S. District Court for the Western District of Texas, Waco Division to dismiss the case, according to the company's May 28, 2014, Form 10-K filing with the U.S. Securities and Exchange Commission for the fiscal year ended Feb. 28, 2014. In February and March of 2011, six putative securities class action complaints were filed in the U.S. District Court for the Western District of Texas, Waco Division. On July 5, 2011, these actions were consolidated into the case styled Selma Stone, et al. v. Life Partners Holdings, Inc., Brian D. Pardo, R. Scott Peden, and David M. Martin , Civil Action No. DR-11-CV-16-AM in the U.S. District Court for the Western District of Texas, Del Rio Division. On February 10, 2012, plaintiffs filed their first amended complaint alleging the same claims that were asserted in the prior complaint. In the amended complaint, plaintiffs assert substantially similar, and at times identical, facts and allegations to those asserted by the SEC in its complaint. Plaintiffs seek damages and an award of costs on behalf of a class of shareholders who purchased or otherwise acquired the company's common stock between May 26, 2006, and June 17, 2011. On March 26, 2012, defendants filed their motion to dismiss the amended complaint. The court denied defendants' motion to dismiss on March 15, 2014. With the ruling on the motion to dismiss, the company anticipates that the parties will now commence discovery. No trial date has been set. LIFE PARTNERS: Suit by Life Settlement Interest Buyers Closed ------------------------------------------------------------- Life Partners Holdings, Inc. said a consolidated lawsuit filed on behalf of purchasers of life settlement interests through Life Partners, Inc. is now considered closed, according to the company's May 28, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2014. Six putative class action complaints were filed during 2011 on behalf of purchasers of life settlement interests through Life Partners, Inc. All of these suits were consolidated on June 23, 2011, under the case styled Turnbow et al. v. Life Partners, Inc., Life Partners Holdings, Inc., Brian D. Pardo, and R. Scott Peden, Civil Action No. 3:11-CV-1030-M. On August 25, 2011, the plaintiffs filed their consolidated class action complaint, alleging claims of breach of fiduciary duty against LPI, aiding and abetting breach of fiduciary duty against the company, Pardo and Peden, breach of contract against LPI, and violation of California Unfair Competition Law by LPI, Pardo, and Peden. All of the plaintiffs' claims arose out of the alleged provision of underestimated life expectancies by Dr. Cassidy to LPI and LPI's use thereof in the facilitation of life settlement transactions in which the plaintiffs acquired interests in life insurance policies. On July 9, 2013, the Federal court issued an order denying class certification. On December 2, 2013, plaintiffs filed a motion for voluntary dismissal without prejudice and a general release by the plaintiffs releasing all defendants from all claims brought in the action. On the same day, the Court issued an order dismissing the action. Copies of the dismissing documents can be found at: http://www.lphi.com/doc/Release_20131203.pdf Because this action was dismissed voluntarily by the plaintiffs, the company considers this matter to be concluded. LIFE PARTNERS: Certification of Life Settlement Suit Under Appeal ----------------------------------------------------------------- Appellate briefing has been completed by the parties in the suit filed by Helen Z. McDermott against Life Partners, Inc. over life settlement and the Court has heard oral arguments, but no ruling has been issued yet, according to Life Partners Holdings, Inc.'s May 28, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2014. On March 11, 2011, a purported class action suit was filed in the 191st Judicial District Court of Dallas County, Texas, styled Helen Z. McDermott, Individually and on Behalf of all Others Similarly Situated v. Life Partners, Inc., Cause No. 11-02966. The original petition asserted claims for breach of contract, breach of fiduciary duty, and unjust enrichment on behalf of a putative class of all persons residing in the United States who purchased any portion of a life settlement that matured earlier than the estimated maximum life expectancy. Pursuant to three amendments to the Petition, the plaintiff revised the putative class of persons on whose behalf the plaintiff seeks to represent to be limited to all persons residing in the United States who purchased any portion of one particular life settlement. The plaintiff seeks as purported damages the amount of funds placed in escrow for policy maintenance that was allegedly not needed or used for policy maintenance and was not returned or paid to the plaintiff or the putative class members as well as attorneys' fees and costs. The plaintiff also seeks certain equitable relief, including injunctive relief, restitution, and disgorgement. Following briefing by the parties and a hearing before the court, the court certified a class consisting of 38 persons residing in the United States that purchased any portion of a life settlement interest in the designated policy. On December 4, 2012, LPI filed a notice of appeal of the district court's order certifying class with the Fifth District Court of Appeals, Dallas, Texas, which automatically stayed the underlying case until resolution of the appeal. Appellate briefing has been completed by the parties and the Court has heard oral arguments. The Court has not issued a ruling. LIFE PARTNERS: Appeals Decision in "Arnold" Securities Suit ----------------------------------------------------------- Life Partners Holdings, Inc. appealed to the Texas Supreme Court a decision of the Court of Appeal declaring in a suit by Michael Arnold and Janet Arnold that Life Partners, Inc.'s life settlements are securities, according to the company's May 28, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2014. On March 14, 2011, a putative class action suit was filed in the 14th Judicial District Court of Dallas County, Texas, styled Michael Arnold and Janet Arnold v. Life Partners, Inc., Life Partners Holdings, Inc., and Abundant Income, Cause No. 11-02995. The plaintiffs ultimately amended their petition several times, adding additional named plaintiffs, and dismissing the company (but not LPI) with prejudice. The plaintiffs asserted two causes of action. The first claim asserted that defendants violated the registration provisions of the Texas Securities Act because the life settlements facilitated by LPI were securities and were not registered. The second claim asserted that defendants committed fraud under the Texas Securities Act because they represented that the life settlements were not securities. LPI answered and filed counterclaims against the plaintiffs for the filing of a frivolous lawsuit. On September 26, 2011, the Court entered an order granting LPI's motion for partial summary judgment. The motion was based on, among other arguments, the arguments that the life settlements had previously been held not to be securities under Federal and state law. As a result of the court order, the plaintiffs' claims against LPI were dismissed with prejudice. Plaintiffs appealed the Court's decision dismissing their claims to the Fifth District Court of Appeals, Dallas, Texas. On August 28, 2013, the Fifth District Court of Appeals, Dallas, Texas, in Arnold v. Life Partners, Inc., 5th Dist. Texas Ct. of App., No. 05-12-00092-CV reversing the trial court's order granting the company's motion for summary judgment and held that LPI's life settlements are securities under the Texas Securities Act. The Court of Appeals affirmed the trial court's order granting defendants' motion for summary judgment on some, but not all, of the individual plaintiffs' claims that were barred by the statute of limitations under the Texas Securities Act. The ruling that the life settlements are securities conflicts with the decision by the Federal Circuit Court for the District of Columbia which ruled in SEC v. Life Partners, Inc. that the company's transactions are not securities under Federal law, and conflicts with the 2004 Waco Court of Appeals decision in Griffitts v. Life Partners, Inc., that the settlements were not securities under Texas law. The company strongly disagrees with the court's analysis and conclusions and note that the decision conflicts with the cases as well as a Travis County, Texas District Court case, in each of which LPI had prevailed and in which the courts had held that the life settlements were not securities. On March 24, 2014, the company appealed the decision to the Texas Supreme Court seeking a review and reversal of the Court of Appeal's decision that LPI's life settlements are securities. The company asked that, if the prior decision is allowed to stand, the Court of Appeal's decision be given prospective effect only, rather than retroactive effect, which could allow plaintiffs, as well as other purchasers of life settlements through LPI, to seek rescission of their purchases. Briefing for review before the Texas Supreme Court is ongoing. If the prior decision is upheld, it could result in a material adverse effect on the company's operations and require substantial changes in the company's business model. LIFE PARTNERS: Bellwether Trial in Overpayment Suit Set for Sept. ----------------------------------------------------------------- The bellwether trial in In re Life Partners, Inc. Litigation is set for September 29, 2014, according to Life Partners Holdings, Inc.'s May 28, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2014. On April 8, 2011, a putative class action complaint was filed in the 40th Judicial District Court of Ellis County, Texas, styled John Willingham, individually and on behalf of all other Texas citizens similarly situated, v. Life Partners, Inc., Cause No. 82640 (MR). On July 27, 2011, by agreement of the parties, the Willingham case was transferred to the 101st Judicial District Court of Dallas County under Cause No. DC-11-10639. All of the plaintiff's claims are based upon the alleged overpayment of premiums to the insurance company, that is, the alleged failure to engage in "premium optimization" on behalf of all Texas residents that purchased an interest in a life settlement facilitated by LPI. On March 15, 2013, the plaintiff filed his fourth amended petition in which eight new named-plaintiffs were added to the suit, and the company, Brian D. Pardo, and R. Scott Peden were added as defendants. In addition to the putative class claims concerning the alleged overpayment of premiums, the amended petition asserts individual claims of breach of fiduciary duty against LPI arising from the alleged overpayment of premiums and the alleged use of underestimated life expectancies provided by Dr. Donald Cassidy, as well as aiding and abetting claims against the company, Pardo and Peden. On January 22, 2013, a petition was filed in the 162nd Judicial District Court, Dallas County, Texas, styled Stephen Eccles, et al vs. Life Partners, Inc., Life Partners Holdings, Inc., Brian D. Pardo and R. Scott Peden on behalf of 23 individuals, all of whom were represented by the same counsel for the plaintiff in the Willingham case. On March 20, 2013, the parties filed a joint motion to consolidate the Eccles case with the Willingham case, which was granted on March 25, 2013. On April 15, 2013, the plaintiffs filed their fifth amended petition dropping all putative class claims and asserting individual claims of breach of fiduciary duty, common law fraud, civil conspiracy, aiding and abetting breach of fiduciary duty and common law fraud, and negligence against the company, LPI, Pardo and Peden. The plaintiff seeks economic and exemplary damages, disgorgement and/or fee forfeiture, attorneys' fees and costs, and post and pre-judgment interest. On April 9, 2013, an original petition was filed in the 352nd Judicial District Court, Tarrant County, Texas, styled Todd McClain, et al v. Life Partners, Inc., Life Partners Holdings, Inc., Brian D. Pardo, and R. Scott Peden. This suit is virtually identical to the Willingham case. On May 15, 2013, the defendants filed a motion to transfer the McClain and Willingham cases to a Multi-District Litigation Panel for the purposes of transferring and consolidating the Willingham case and the McClain case to a single forum for pretrial purposes. On August 16, 2013, the Multidistrict Litigation Panel issued an opinion granting the motion to transfer, and on September 9, 2013, the Panel issued an Order transferring the McClain case to Judge Slaughter of the 191st District Court of Dallas County and consolidating the McClain case (and any tag along cases subsequently filed) with the Willingham case. The consolidated MDL case is styled In re Life Partners, Inc. Litigation (the "MDL Proceedings"). In the MDL Proceedings, all of plaintiffs' claims are based upon the alleged failure to engage in "premium optimization," as well as the alleged provision of underestimated life expectancies by Dr. Donald Cassidy to LPI and LPI's use in the facilitation of life settlement transactions in which plaintiffs acquired interests in life insurance policies. Plaintiffs seek economic and exemplary damages, disgorgement and/or fee forfeiture, attorneys' fees and costs, and post and pre-judgment interest. On August 9, 2013, the Court entered a scheduling order setting a bellwether trial consisting of ten plaintiffs, five selected by plaintiffs and five selected by defendants, with the remaining plaintiffs trying their claims in groups of 16 approximately 90 days after the conclusion of each trial. The parties are currently engaged in discovery, and the bellwether trial is set for September 29, 2014. LIFE PARTNERS: "Steuben" Suit Awaits Resolution of "Willingham" --------------------------------------------------------------- The Superior Court of the State of California for the County of Los Angeles Court stayed an unfair competition case filed by Marilyn Steuben pending resolution of the suit John Willingham, individually and on behalf of all other Texas citizens similarly situated, v. Life Partners, Inc., Cause No. 82640 (MR), according to Life Partners Holdings, Inc.'s May 28, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended March 31, 2014. On November 8, 2011, a putative class action suit was filed, styled Marilyn Steuben, on behalf of herself and all other California citizens similarly situated v. Life Partners, Inc., Superior Court of the State of California for the County of Los Angeles Court, Case No. BC472953. This suit asserts claims of fiduciary duty, breach of contract, and violations of California's Unfair Competition law based upon the alleged overpayment of premiums to the insurance company, that is, the alleged failure to engage in "premium optimization. On December 3, 2012, the plaintiffs filed their motion to intervene in the Turnbow case whereby the plaintiffs sought to join the putative Turnbow class and subclass and to create a new subclass asserting claims for damages related to the defendants' alleged overpayment of premiums. The Federal District Judge in the Turnbow case denied the plaintiffs' motion to intervene on February 5, 2013 and the Turnbow case was voluntarily dismissed in December 2013. On January 29, 2014, the parties filed a joint status report with the court, and on February 5, 2014, the court stayed the case pending resolution of the Willingham suit, which is now set for trial in September 29, 2014. Another joint status update was due June 5, 2014. LINKEDIN CORP: Judge Allows Suit Over Marketing Emails to Proceed ----------------------------------------------------------------- Julia Love, writing for The Recorder, reports that a federal judge has refused to let LinkedIn off the hook for pestering its members' acquaintances to join the professional networking site. Ruling in a privacy class action filed last year against LinkedIn Corp., U.S. District Judge Lucy Koh of the Northern District of California found that the social networking site might have damaged its users' reputations by sending repeated emails to addresses harvested from their contact lists. Judge Koh dismissed some claims, reasoning that plaintiffs gave consent for the company to invite contacts to join their professional networks. However, she faulted the company for persisting with its email campaign even after recipients declined to join the site. Because the messages appear to come from users, they could be "professionally or personally harmful," Judge Koh wrote. "The second and third endorsement emails could injure users' reputations by making the users' contacts believe that the users are the types of people who spam their contacts or are unable to take the hint that their contacts do not want to join their LinkedIn network," she wrote in a 39-page order issued on June 12. The decision allowed plaintiffs in Perkins v. LinkedIn, 13-4303, to move forward with common-law right-of-publicity claims, as well as a claim under California's Unfair Competition Law. Plaintiffs are represented by Larry Russ -- lruss@raklaw.com -- and Dorian Berger -- dberger@raklaw.com -- of Russ August & Kabat in Los Angeles. Munger, Tolles & Olson partners Jerome Roth -- Jerome.Roth@mto.com -- and Rosemarie Ring -- Rose.Ring@mto.com -- are defending LinkedIn. The suit accuses LinkedIn of harvesting users' email addresses without their consent to send invitations that are virtually spam. On message boards, one user accused LinkedIn of "hacking," while another complained that the site was "hurting my reputation rather than helping it," according to the complaint. Judge Koh noted that none of the plaintiffs had opted out of the invitation service, though they had the option to do so. She added that LinkedIn was more forthright about its harvesting of user information than many technology companies. "Importantly, this disclosure is presented immediately prior to the moment at which LinkedIn is alleged to have engaged in wrongful conduct," she wrote. "It was not, as is often the case, a disclosure buried in a Terms of Service or Privacy Policy." Judge Koh dismissed plaintiffs' claims filed under the Stored Communications Act and the Wiretap Act with leave to amend. She also ordered plaintiffs to rework their misrepresentation claims under the UCL, finding that plaintiffs had not shown they had relied on LinkedIn's allegedly misleading statements to the public. "The fact that some of the alleged misrepresentations appeared on screens that all users had to click through to register do not by themselves establish that any of the plaintiffs actually read or relied on the misrepresentations," she wrote. MAIDENFORM BRANDS: Faces Class Suit Over Novarel Slimming Claims ---------------------------------------------------------------- Charles Toutant, writing for New Jersey Law Journal, reports that makers of undergarments infused with minerals and nutrients that are promised to improve the wearer's physique and skin tone are feeling the squeeze of litigation. Maidenform Brands and Wacoal America face three class-action suits over claims about shapewear made of Novarel Slim, a "cosmetotextile" embedded with microcapsules of caffeine to promote fat destruction, ceramides to restore and maintain the skin's smoothness and retinol to make the skin firmer. The Federal Trade Commission has called the claims "about as credible as a note from the Tooth Fairy," according to federal court complaints in New Jersey, Massachusetts and Florida. The suits seek to recover, on behalf of a class of users who bought Novarel Slim products from Wacoal or Maidenform, under state consumer fraud laws and on theories of breach of warranty and unjust enrichment. Maidenform claimed its Instant Slimmer line made from Novarel Slim could "reduce the appearance of cellulite" and was promoted as "embedded with microcapsules containing caffeine to promote fat destruction." Wacoal allegedly sold a line called iPant which it called "hope on a hanger," claiming it "works with your body to visually reduce the appearance of cellulite from your waist, hips and thighs." The company said iPant, if worn eight hours a day for 28 days, would result in a reduction in thigh measurement. It also claimed the active ingredients in the iPant are still present after the garment is washed 100 times. "Defendants make these misrepresentations in order to prey upon women's insecurities about their body images," according to the complaint in Caramore v. Maidenform Brands. The Caramore case was filed on March 28, initially in Brooklyn, N.Y., and has been transferred to Newark. A second complaint, Bellot v. Maidenform Brands, was filed on April 14 in Boston, and a third, Bellot v. Maidenform Brands, was filed on May 21 in Tallahassee. The three complaints contain nearly identical wording, including the claim that the defendants' products "do not reduce thigh measurement or promote fat destruction." The plaintiffs say the companies charged as much as 50 percent more for Novarel Slim shapewear than for comparable items not infused with nutrients, but buyers have been bilked because the nutrients cannot cure cellulite, destroy fat or cause weight loss. On May 21, counsel for the defendants petitioned the Judicial Panel on Multidistrict Litigation to have the cases venued in Newark for coordinated pretrial proceedings. The lawyers said they had received notice that a second suit would be filed in Tallahassee. Newark, they said, is convenient to transportation and is close to Lyndhurst, N.J., the U.S. headquarters of Wacoal, a Japanese company, and Iselin, N.J., Maidenform's headquarters until its recent acquisition by Hanes. On June 5, counsel for both sides in the Caramore case asked U.S. District Judge Faith Hochberg to stay the proceedings pending the outcome of the JPML motion. The Novarel Slim fabric is made by Nurel of Zaragosa, Spain, which is not party to the suits. Rebekah Kaufman -- rkaufman@mofo.com -- of Morrison & Foerster in San Francisco, representing Wacoal, and Michael Mallow -- mmallow@loeb.com -- of Loeb & Loeb in Los Angeles, representing Maidenform, did not return calls. David Krangle of Alonso Krangle in Melville, N.Y., and Elizabeth Fegan -- beth@hbsslaw.com -- of Hagens Berman Sobol Shapiro in Oak Park, Ill., representing the plaintiff in Caramore, also did not return calls. MANSFIELD BANK: Suit Seeks to Recover Unpaid Overtime Wages ----------------------------------------------------------- Ryann Fenn v. Mansfield Bank, Case No. 1:14-cv-12554 (D. Mass., June 17, 2014), seeks judgment awarding the Plaintiff and all similarly situated employees all unpaid overtime compensation, damages for emotional distress, punitive damages, liquidated damages, treble damages, and attorneys' fees and costs as mandated under the Fair Labor Standards Act. Mansfield Bank has a principal place of business in Mansfield, Bristol County, Commonwealth of Massachusetts. The Plaintiff is represented by: Daniel W. Rice, Esq. GLYNN, LANDRY, & RICE, LLP 25 Braintree Hill Office Park, Suite 408 Braintree, MA 02184 Telephone: (781) 849-8479 Facsimile: (781) 356-3393 E-mail: daniel.rice@glhrlaw.com MICHIGAN: "Rivera" Suit v. Correction Dept. May Proceed ------------------------------------------------------- WILSON RIVERA, Plaintiff, v. MICHIGAN DEPARTMENT OF CORRECTIONS et al., Defendants, CASE NO. 1:14-CV-214, (W.D. Mich.) is a civil rights action brought by a state prisoner under 42 U.S.C. Section 1983, the Religious Land Use and Institutionalized Persons Act (RLUIPA), 42 U.S.C. Section 2000cc-1 et seq., and state law. The Court has granted Plaintiff leave to proceed in forma pauperis. District Judge Robert J. Jonker, in an opinion dated May 28, 2014, a copy of which is available at http://is.gd/5fFK0Hfrom Leagle.com, dismissed the Plaintiff's complaint for failure to state a claim against Defendant Jones Bey. The Court will allow the action to proceed against Defendants Michigan Department of Corrections, Heyns, Finco, Martin, White, Stephens, Wolfe, the Chaplaincy Advisory Council (CAC), and the unidentified members of the CAC, he added. Wilson Rivera #239567, Named as Wison Rivera Bey. Ako Gilmore Bey, James Goodman Bey and Members of the Moorish Science Temple of America-1928 Grand Body/Moorish Divine National Movement (A Class of Moorish Moslems) named on initiating document but did not sign complaint, plaintiff, Pro Se. MONTANA: Farmers Lose Class Action Over Tax Increases ------------------------------------------------------ Tom Lutey, writing for Billings Gazette, reports that Montana farmers have lost their class action lawsuit accusing the state of jumping the gun on tax increases. District Court Judge Randal Spaulding ruled that Montana's Department of Revenue was in the right in 2009 when it imposed the maximum tax allowed on some Montana farms, while choosing to phase-in taxes on other farms over six years. Roughly 2,000 farmers who have paid their taxes in protest since 2009 will be affected by the ruling, though several thousand more had hoped to benefit from the class action. At issue was the 2009 reappraisal cycle, which brought dramatic changes to the way Department of Revenue officials were determining taxable value of farm property. For the first time, the Department of Revenue using satellite Global Positioning System technology, soil sampling, and other methods to get a more precise assessment. What the department found was that in some cases previous assessments were inaccurate. Acres had gone unaccounted, or had been put to a different use, which had not been noted on previous tax rolls. Those acres, unearthed by new assessment, changed the nature of a farm's property so much that the entire farm no longer qualified for the standard six-year phase in of property taxes. In essence, farm plaintiff's said, the Revenue Department treated the land change like it might treat an addition onto a house. The addition reset the entire property's taxable assessment and made the property ineligible for a tax phase in. "We are obviously disappointed by the decision," said Mike Green, Montana Farm Bureau Federation attorney. "The Court appears to have accepted the Department's arguments that ag land changes must be treated the same as new construction of a home." The plaintiffs argued that homes and farm property were in different tax classifications and should be treated differently. At the least, they argued, land that hadn't been altered should get the phase in. The court disagreed. Dan Whyte, deputy chief legal council for the Department of Revenue, said the reason so many farmers were affected was because it had been years, in some cases decades, since changes had been made to what property information was being submitted to DOR. Farmers simply resubmitted the same information year after year, even though some of their acres had changed, either because they had been put into production, or they had been put to a different, more profitable use. "I think it happened in many, many cases because there are tens of thousands of farms across the state and no one had done an assessment for anyone probably in 40 years," Mr. Whyte said. Spaulding concluded that Department of Revenue had correctly carried out the tax law prescribed by the state Legislature, Mr. Whyte said. But Bob Story, of the Montana Taxpayer's Association, was a member of the Legislature when the Department of Revenue presented its interpretation of the law to legislators. It wasn't clear how the phase-in issue would be handled, Story said. He said he doubts many lawmakers shared DOR's interpretation. Plaintiffs in the case now have 60 days to decide whether to appeal to the state Supreme Court. MONTREAL MAINE: Train Derailment Class Action Hearings Begin ------------------------------------------------------------ Rene Bruemmer, writing for Montreal Gazette, reports that with a small army of lawyers and legal aides at the ready, arguments on whether to authorize one of the largest class-action suits in Canadian history, on behalf of citizens of Lac-Megantic, began in a crowded Sherbrooke courtroom on June 9. The hearings could not be heard in Lac-Megantic because it does not have a courtroom large enough to accommodate the legal teams of the 53 oil and rail companies and their subsidiaries as well as the government departments and employees named in the proposed class-action suit, as well as lawyers for the victims. More than 3,500 people have signed to join the suit to date. "As everyone knows, this action arises from a series of closely related events that culminated in the train derailment and the explosion of July 6, 2013," said lawyer Joel Rochon -- jrochon@rochongenova.com -- of Toronto firm Rochon Genova LLP, one of the three firms working on the suit. "Forty-seven residents of Lac-Megantic died. Two thousand were forced to leave their homes. . . . What was once a vibrant lakeside central business district is now a disfigured environmental disaster area which can never be truly fully repaired. The financial and psychological impact on this close-knit community of close to 6,000 residents have changed the face of Lac-Megantic forever. All residents have suffered losses in different respects." Lawyers for the class-action suit allege the train derailment and resulting injuries and damages were caused by the respondents, who they say knowingly used unsafe DOT-111 train cars to transport highly volatile oil that was not labelled as such. Included among the defendants are Montreal, Maine & Atlantic Railway and its Canadian operations, former MMA owner Ed Burkhardt, the engineer who parked the train before the fatal explosion, as well as oil companies that supplied the contents and other transportation affiliates involved. The proposed class- action suit, which if approved could result in a settlement in the hundreds of millions of dollars, lawyers estimated, is just one of many legal actions involving disaster victims. In April, judges in Quebec and Maine approved a cross-border process for victims to file claims against the MMA railway companies. Because MMA had only $25 million in insurance, lawyers are hoping implicated firms can be sued to compensate victims and secured creditors, cover cleanup costs and pay damages to companies that have lost business because of the tragedy. The class-action suit presented in Quebec Superior Court on June 9 also accused MMA of cutting costs at the expense of safety. Some firms have already said they will defend themselves on the basis they were not directly involved, or responsible for the actions of subcontractors handling the Lac-Megantic trains and the oil therein. In his opening arguments on June 9, lawyer Rochon said all implicated companies shared guilt. "Had the respondents focused on acting reasonably, the outcome would have been much different. . . ." he said. "We have in this courtroom through the counsel that represents these corporations, some of the most sophisticated, knowledgeable and experienced players in the oil industry. So when you hear (them say during the trial): 'How were we to know about the DOT-111 cars or the volatility of oil?' just pause and think, 'Does this really measure up to the level of credibility required for plausible deniability.'" No victims of the disaster were in court on June 9. A plan to teleconference to Lac-Megantic so victims living more than an hour's drive from Sherbrooke could watch the proceedings was scrapped because of technical reasons. MORGAN STANLEY: Dismissal of Claims in "Coultier" Suit Affirmed --------------------------------------------------------------- An appeal is pending before the United States Court of Appeals, Second Circuit from two March 28, 2013 orders in related cases by the United States District Court for the Southern District of New York (Deborah A. Batts, Judge). In these related cases, Plaintiffs-Appellants allege violations of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. Section 1001, et seq. The district court granted Defendants-Appellees' Rule 12(b)(6) motions to dismiss. In their appeal, the Plaintiffs contended that the district court abused its discretion in dismissing their claims with prejudice. The Second Circuit disagreed with this and held that the Plaintiffs have identified no facts that, if alleged, would establish a valid claim. The district court, therefore, did not abuse its discretion because any amendment to the allegations concerning Defendants' fiduciary status would be futile, ruled the Second Circuit. "We have considered all of Plaintiffs' arguments and find them to be without merit. We hereby affirm the district court's orders of March 28, 2013, which granted Defendants' motions to dismiss in the two related cases consolidated for this appeal," concluded in the Second Circuit in its Opinion dated May 29, 2014, a copy of which is available at http://is.gd/e8VyyU from Leagle.com. The case is G. KENNETH COULTER, JOHN SIEFKEN, GREGORY MAJOR, MICHAEL CHIEKO, ELI MOND, JOHN SUDOLSKY, on behalf of themselves and all others similarly situated, CAROLYN EGAN, on behalf of herself and all others similarly situated, CELESTE MARTINEZ, on behalf of herself and all others similarly situated, Plaintiffs- Appellants, ELENA RAMOS, ALVIN SAINI, Plaintiffs, v. MORGAN STANLEY & CO. INCORPORATED, MORGAN STANLEY, THE INVESTMENT COMMITTEE OF THE MORGAN STANLEY 401(K) PLAN, THE MORGAN STANLEY GLOBAL DIRECTOR OF HUMAN RESOURCES, JOHN J. MACK, KAREN JAMESLEY, WALID A. CHAMMAH, CHARLES CHASIN, JAMES P. GORMAN, ELLYN A. McCOLGAN, MICHAEL J. PETRICK, MICHAEL RANKOWITZ, MICHAEL T. CUNNINGHAM, R. BRADFORD EVANS, KIRSTEN FELDMAN, EDMUND C. PUCKHABER, WILLIAM B. SMITH, JOHN DOES DEFENDANTS 1-10, THOMAS C. SCHNEIDER, RICHARD PORTOGALLO, NEIL A. SHEAR, CORDELL G. SPENCER, CAITLIN LONG, ZOE CRUZ, JOHN DOE, 1-30, JOHN DOES 1-10, UNKNOWN MEMBERS OF THE MANAGEMENT DEFENDANTS, JOHN DOES 11-20, UNKNOWN MEMBERS OF THE INVESTMENT COMMITTEE, JOHN DOES 21-30, UNKNOWN MEMBERS OF THE PLAN ADMINISTRATOR DEFENDANTS, Defendants- Appellees, ROY J. BOSTOCK, ERSKINE B. BOWLES, ROBERT C. KIDDER, DONALD T. NICOLAISEN, CHARLES H. NOSKI, HUTHAM S. OLAYAN, CHARLES E. PHILLIPS, JR., LAURA D. TYSON, KLAUS ZUMWINKEL, O. GRIFFITH SEXTON, Defendants, DOCKET NOS. 13-2504-CV(L), 13-2509-CV(CON). MICHAEL JAFFE -- jaffe@whafh.com -- Wolf Haldenstein Adler Freeman & Herz LLP, New York, NY (Mark C. Rifkin -- rifkin@whafh.com -- Wolf Haldenstein Adler Freeman & Herz LLP, New York, NY; Sanford P. Dumain -- sdumain@milberg.com -- Lori G. Feldman -- lfeldman@milberg.com -- Arvind Khurana -- akhurana@milberg.com -- Milberg LLP, New York, NY; Robert I. Harwood -- rharwood@hfesq.com -- James G. Flynn -- jflynn@hfesq.com -- Tanya Korkhov -- tkorkhov@hfesq.com -- Harwood Feffer LLP, New York, NY; Thomas J. McKenna -- tjmckenna@gaineyandmckenna.com -- Gainey & McKenna, New York, NY; Jeffrey Abraham -- jabraham@aftlaw.com -- Abraham, Fruchter & Twersky, LLP, New York, NY; Milo Silberstein -- msilberstein@dsblawny.com -- Dealy Silberstein & Braverman, LLP, New York, NY, on the brief) for Plaintiffs-Appellants. ROBERT F. WISE, JR. -- robert.wise@davispolk.com -- (Charles S. Duggan -- charles.duggan@@davispolk.com -- Elyse Jones Cowgill -- elyse.cowgill@davispolk.com -- Andrew Ditchfield -- andrew.ditchfield@davispolk.com -- on the brief), Davis Polk & Wardwell LLP, New York, NY, for Defendants-Appellees. MORGAN STANLEY: Obtains Favorable Ruling in Pass-Thru Cert. Suit ---------------------------------------------------------------- Before the Court in In re Morgan Stanley Mortgage Pass-Through Certificates Litigation, NO. 09 CIV. 2137 (LTS)(SN), (S.D. N.Y.) is the motion of defendants Morgan Stanley Capital I Inc., Morgan Stanley Mortgage Capital Holdings LLC, Morgan Stanley & Co. Incorporated, Morgan Stanley, David R. Warren, Anthony B. Tufariello, William J. Forsell, and Steven S. Stern for reconsideration, in light of the Second Circuit's decision in In re IndyMac Mortgage-Backed Securities Litigation, 721 F.3d 95, 109 (2d Cir. 2013), of the Court's September 15, 2011 opinion and order holding that named plaintiffs' claims are timely. Morgan Stanley, 810 F.Supp.2d 650, 670 (S.D.N.Y. 2011) District Judge Laura Taylor Swain, in a memorandum opinion and order dated May 27, 2014, a copy of which is available at http://is.gd/qBnIsPfrom Leagle.com, granted the Defendants' motion for reconsideration and vacated the September Order. "New Plaintiffs' claims are dismissed in their entirety as time- barred by the Section 13 statute of repose, insofar as they are asserted directly by New Plaintiffs as named parties," ruled Judge Swain. "The dismissal of New Plaintiffs' claims is without prejudice to the litigation of those claims by one or more class representatives if MissPERS's pending motion for class certification is granted." The Court directed the parties to file any supplemental papers in connection with their class certification motion submissions. West Virginia Investment Management Board, Lead Plaintiff, represented by David Avi Rosenfeld, Robbins Geller Rudman & Dowd LLP, Arthur C. Leahy, Robbins Geller Rudman & Dowd LLP, Mark W. Carbone, Carbone & Blaydes, PLLC, Matthew I. Alpert, Robbins Geller Rudman & Dowd LLP, Nathan R. Lindell, Robbins Geller Rudman & Dowd LLP, Ryan A. Llorens, Robbins Geller Rudman & Dowd LLP, Scott H. Saham, Robbins Geller Rudman & Dowd LLP, Susan G. Taylor, Robbins Geller Rudman & Dowd LLP & Thomas Edward Egler, Robbins Geller Rudman & Dowd LLP. Public Employees' Retirement System of Mississippi, Individually and on behalf of all others similarly situated, Plaintiff, represented by Brett M. Middleton, Bernstein Litowitz Berger & Grossmann LLP, David R. Stickney, Bernstein Litowitz Berger & Grossmann LLP, David Lloyd Wales, Bernstein Litowitz Berger & Grossmann LLP, Timothy Alan DeLange, Bernstein Litowitz Berger & Grossmann LLP, Arthur C. Leahy, Robbins Geller Rudman & Dowd LLP, Carolina Cecilia Torres, Robbins Geller Rudman & Dowd LLP, Daniel S. Drosman, Robbins Geller Rudman & Dowd LLP, David Avi Rosenfeld, Robbins Geller Rudman & Dowd LLP, David A. Thorpe, Dietrich Siben Thorpe, Ivy T. Ngo, Robbins Geller Rudman & Dowd LLP, Jarrett Scott Charo, Robbins Geller Rudman & Dowd LLP, Jeroen Van Kwawegen, Bernstein Litowitz Berger & Grossmann LLP, Jonah H. Goldstein, Robbins Geller Rudman & Dowd LLP, Katherine Anastasia Stefanou, Bernstein Litowitz Berger & Grossmann LLP, Luke Orion Brooks, Robbins Geller Rudman & Dowd LLP, Matthew P. Jubenville, Bernstein Litowitz Berger & Grossmann LLP, Richard David Gluck, Bernstein Litowitz Berger & Grossmann LLP & Samuel Howard Rudman, Robbins Geller Rudman & Dowd LLP. Pompano Beach Police and Firefighters' Retirement System, Plaintiff, represented by Angel P. Lau, Robbins Geller Rudman & Dowd LLP, Ashley M Robinson, Robbins Geller Rudman & Dowd LLP, Carolina Cecilia Torres, Robbins Geller Rudman & Dowd LLP, Caroline M Robert, Robbins Geller Rudman & Dowd LLP, Daniel S. Drosman, Robbins Geller Rudman & Dowd LLP, Darryl J. Alvarado, Robbins Geller Rudman & Dowd LLP, David J. Harris, Jr, Robbins Geller Rudman & Dowd LLP, David Avi Rosenfeld, Robbins Geller Rudman & Dowd LLP, Hillary B. Stakem, Robbins Geller Rudman & Dowd LLP, Ivy T. Ngo, Robbins Geller Rudman & Dowd LLP, Jarrett Scott Charo, Robbins Geller Rudman & Dowd LLP, Jonah H. Goldstein, Robbins Geller Rudman & Dowd LLP, L. Dana Martindale, Robbins, Geller, Rudman & Dowd LLP, Luke Orion Brooks, Robbins Geller Rudman & Dowd LLP, Ryan A. Llorens, Robbins Geller Rudman & Dowd LLP & Samuel Howard Rudman, Robbins Geller Rudman & Dowd LLP. Carpenters Pension Fund of West Virginia, Plaintiff, represented by Angel P. Lau, Robbins Geller Rudman & Dowd LLP, Ashley M Robinson, Robbins Geller Rudman & Dowd LLP, Carolina Cecilia Torres, Robbins Geller Rudman & Dowd LLP, Caroline M Robert, Robbins Geller Rudman & Dowd LLP, Daniel S. Drosman, Robbins Geller Rudman & Dowd LLP, Darryl J. Alvarado, Robbins Geller Rudman & Dowd LLP, David J. Harris, Jr, Robbins Geller Rudman & Dowd LLP, David Avi Rosenfeld, Robbins Geller Rudman & Dowd LLP, Hillary B. Stakem, Robbins Geller Rudman & Dowd LLP, Ivy T. Ngo, Robbins Geller Rudman & Dowd LLP, Jarrett Scott Charo, Robbins Geller Rudman & Dowd LLP, Jonah H. Goldstein, Robbins Geller Rudman & Dowd LLP, L. Dana Martindale, Robbins, Geller, Rudman & Dowd LLP, Luke Orion Brooks, Robbins Geller Rudman & Dowd LLP, Ryan A. Llorens, Robbins Geller Rudman & Dowd LLP & Samuel Howard Rudman, Robbins Geller Rudman & Dowd LLP. NECA-IBEW Health and Welfare Fund, Plaintiff, represented by Angel P. Lau, Robbins Geller Rudman & Dowd LLP, Ashley M Robinson, Robbins Geller Rudman & Dowd LLP, Carolina Cecilia Torres, Robbins Geller Rudman & Dowd LLP, Caroline M Robert, Robbins Geller Rudman & Dowd LLP, Daniel S. Drosman, Robbins Geller Rudman & Dowd LLP, Darryl J. Alvarado, Robbins Geller Rudman & Dowd LLP, David J. Harris, Jr, Robbins Geller Rudman & Dowd LLP, David Avi Rosenfeld, Robbins Geller Rudman & Dowd LLP, Hillary B. Stakem, Robbins Geller Rudman & Dowd LLP, Ivy T. Ngo, Robbins Geller Rudman & Dowd LLP, Jarrett Scott Charo, Robbins Geller Rudman & Dowd LLP, Jonah H. Goldstein, Robbins Geller Rudman & Dowd LLP, L. Dana Martindale, Robbins, Geller, Rudman & Dowd LLP, Luke Orion Brooks, Robbins Geller Rudman & Dowd LLP, Ryan A. Llorens, Robbins Geller Rudman & Dowd LLP & Samuel Howard Rudman, Robbins Geller Rudman & Dowd LLP. Members United Corporate Federal Credit Union, Plaintiff, represented by Carolina Cecilia Torres, Robbins Geller Rudman & Dowd LLP, David Avi Rosenfeld, Robbins Geller Rudman & Dowd LLP, Ivy T. Ngo, Robbins Geller Rudman & Dowd LLP, Jarrett Scott Charo, Robbins Geller Rudman & Dowd LLP, Jonah H. Goldstein, Robbins Geller Rudman & Dowd LLP, Ryan A. Llorens, Robbins Geller Rudman & Dowd LLP & Samuel Howard Rudman, Robbins Geller Rudman & Dowd LLP. Morgan Stanley, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, James P. Rouhandeh, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Morgan Stanley Mortgage Capital Inc., Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, Heather Brae Hoesterey, Reed Smith, LLP, Hayward Homes Smith, Davis Polk & Wardwell L.L.P., James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Morgan Stanley Dean Witter Capital I Inc, formerly known as Morgan Stanley Capital I Inc, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, Heather Brae Hoesterey, Reed Smith, LLP, James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Morgan Stanley & Co Incorporated, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, Heather Brae Hoesterey, Reed Smith, LLP, James P. Rouhandeh, Davis Polk & Wardwell L.L.P., Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. MCGraw-Hill Companies Inc, Defendant, represented by Adam N. Zurofsky, Cahill Gordon & Reindel LLP, David T. Biderman, Perkins, Coie, L.L.P., Floyd Abrams, Cahill Gordon & Reindel LLP, Judith B. Gitterman, Perkins Coie LLP, Christopher Anthony Gorman, Cahill Gordon & Reindel LLP, Floyd Abrams, Cahill Gordon & Reindel LLP, Sarah Penny Windle, Cahill Gordon & Reindel LLP & Tammy Lynn Roy, Cahill Gordon et ano.. Moody's Corp., Defendant, represented by David Andrew McCarthy, Wilson Sonsini Goodrich & Rosati, James J. Coster, Satterlee Stephens Burke & Burke LLP, Keith E. Eggleton, Wilson Sonsini Goodrich & Rosati, P.C., Joshua M. Rubins, Satterlee Stephens Burke & Burke LLP & Justin Evan Klein, Satterlee Stephens Burke & Burke LLP. Anthony B. Tufariello, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P., James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. William J. Forsell, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P., James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Valerie H. Kay, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Steven S. Stern, Defendant, represented by Christopher Burch Hockett, Davis Polk & Wardwell, Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P., James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Morgan Stanley Mortgage Capital Holdings LLC, Defendant, represented by Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P. & James P. Rouhandeh, Davis Polk & Wardwell L.L.P.. Morgan Stanley, Defendant, represented by Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P. & James P. Rouhandeh, Davis Polk & Wardwell L.L.P.. Morgan Stanley Capital I Inc, Consolidated Defendant, represented by Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P., James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Fitch, Inc., Consolidated Defendant, represented by Andrew James Ehrlich, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Martin Flumenbaum, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Roberta Ann Kaplan, Paul, Weiss, Rifkind, Wharton & Garrison LLP & Tobias James Stern, Paul, Weiss, Rifkind, Wharton & Garrison LLP. David R. Warren, Consolidated Defendant, represented by Carissa Marie Pilotti, Davis Polk & Wardwell L.L.P., Dana Meredith Seshens, Davis Polk & Wardwell L.L.P., Hayward Homes Smith, Davis Polk & Wardwell L.L.P., James P. Rouhandeh, Davis Polk & Wardwell L.L.P. & William Joseph Fenrich, Davis Polk & Wardwell L.L.P.. Police and Fire Retirement System of the City of Detroit, Intervenor Plaintiff, represented by Robin F. Zwerling, Zwerling, Schachter & Zwerling. NAP NANNY: CPSC Announces 6th Baby Death Due to Infant Recliner --------------------------------------------------------------- ABC News reports that a sixth baby has died while using a recalled "Nap Nanny" infant recliner, with safety experts again urging parents to stop using the product. According to the Consumer Product Safety Commission, or CPSC, the latest tragedy involved an 8-month-old girl from New Jersey. The baby suffocated while secured by a belt, trapped between the product and a crib bumper. CPSC officials said the infant was found stuck over the side of a Nap Nanny. CPSC Communications Director Scott Wolfson said parents should avoid the recliners at yard sales, as hand-me-downs or in online auctions. "Our message to parents is clear: Stop using it. It's dangerous," Mr. Wolfson said. "There's been six deaths already, and we don't want another child to die unnecessarily." About 165,000 Nap Nanny and Nap Nanny Chill recliners were sold between 2009 and 2012. Nap Nannies -- which are no longer sold in stores -- were recalled last year, but for months the company that made the portable recliner refused to pull it from shelves or offer refunds, instead insisting on the product's safety when used properly. In a statement, an official with the company, now out of business for two years, told ABC News it was heartbroken for the families who have lost a child, but said the Nap Nanny was never intended for use in a crib. Brian Thiel's 4-month-old daughter died in 2010 while using the Nap Nanny. His settlement agreement with the maker of Nap Nanny limited what he could say. "There was a death almost a year prior to my daughter dying," Mr. Thiel said. "Had we known that, we never would have purchased this product." It is illegal to sell the Nap Nanny in the United States, Mr. Wolfson said. NEW EXPRESS MOBIL: Suit Seeks to Recover Unpaid Overtime Wages -------------------------------------------------------------- Hashim Mustafa, And All Others Similarly Situated v. New Express Mobil Mart, Inc.; Punjabi Group, Inc.; Quicky Mart; SR Bukhari, Inc.; Victoria Hospitality, Inc.; Syed Babar Bukhari; Syed Rashid Bukhari; and, Usman Rashid Bukhari, Case No. 4:14-cv-01668 (S.D. Tex., June 14, 2014), seeks to recover unpaid overtime wages under the Fair Labor Standards Act. New Express Mobil Mart, Inc., Punjabi Group, Inc., Quicky Mart, SR Bukhari, Inc., and Victoria Hospitality, Inc., are Texas corporations. The Individual Defendants are corporate officers, managers or owners of the Corporate Defendants. The Defendants own one or more business establishments engaged in interstate commerce or in the production of goods for interstate commerce in the state of Texas. The Plaintiff is represented by: Salar Ali Ahmed, Esq. ALI S. AHMED, P.C. One Arena Place 7322 Southwest Freeway, Suite 1920 Houston, TX 77074 Telephone: (713) 223-1300 Facsimile: (713) 255-0013 E-mail: aahmedlaw@gmail.com NORTH CAROLINA: "Alston" Suit v. Public Safety Dept Dismissed ------------------------------------------------------------- Marcus Alston is a prisoner of the State of North Carolina and he is presently confined in the Lanesboro Correctional Institution. In his complaint, the Ms. Alston contends that his constitutional rights have been violated through unreasonable searches and seizures following his transfer to Lanesboro Correctional in December 2013. The Plaintiff alleges that he was subjected to several searches and seizures and placed in restraints for 48 hours and was not permitted to use the restroom and was deprived of his property for a couple of weeks. The Plaintiff asserts that he filed a grievance against Unit Manager Marshall for harassment, discrimination and the use of excessive force. The Plaintiff also alleges that Officer Chapmen and other officers confronted him while he was in the shower and retaliated against him for filing the complaint against Marshall by removing property from his cell and assaulting him. In his claim for relief, Plaintiff is seeking compensatory and punitive damages. A copy of Judge Martini's May 28, 2014 Opinion is available at http://is.gd/CuG19Ufrom Leagle.com. In an order dated May 28, 2014, District Judge Frank D. Whitney found that the Plaintiff has failed to state a claim upon which relief may be granted. Accordingly: 1. Plaintiff's complaint is dismissed without prejudice. 2. Plaintiff's motion for class certification is denied. 3. Plaintiff's motion to appoint counsel is denied. The Clerk of Court was directed to close the civil case. The case is MARCUS ALSTON, Plaintiff, v. GEORGE T. SOLOMON, DAVID MITCHELL, NORTH CAROLINA DEP'T OF PUBLIC SAFETY, Defendants, NO. 3:14-CV-250-FDW, (W.D. N.C.). Marcus Alston, Plaintiff, Pro Se. NY THRUWAY AUTHORITY: Sued by Terminated Workers and Their Union ---------------------------------------------------------------- New York State Thruway Employees Local 72; Joseph E. Colombo, George E. Savoie, David M. Mazzeo, individually and on behalf of all others similarly-situated v. New York State Thruway Authority, et al., Case No. 1:14-cv-04356 (S.D.N.Y., June 17, 2014), is brought for monetary damages and injunctive relief pursuant to the Civil Rights Act of 1871. The New York State Thruway Employees Local 72 brought the lawsuit on behalf of itself and on behalf of approximately 2,600 of its members. The Individual Plaintiffs -- union members whose employment was terminated as a result of the Defendants' alleged illegal conduct -- bring the action on behalf of themselves and all others similarly-situated. The Plaintiffs seek to redress the Defendants' alleged intentional violation of their constitutional rights to freedom of speech, freedom of association, due process and equal protection of the law under the First, Fifth and Fourteenth Amendments to the United States Constitution, along with violations of the New York State Constitution. The Defendants are New York State Thruway Authority; Howard P. Milstein, individually and in his official capacity as Chairman of the New York State Thruway Authority; Thomas J. Madison, Jr., individually and in his official capacity as Executive Director of the New York State Thruway Authority; Thomas Ryan, individually and in his official capacity; Joseph Bress, individually and in his official capacity as Chief Negotiator of the New York State Thruway Authority; Howard Glaser, individually and in his official capacity as Director of State Operations and Senior Policy Advisor to the Governor of New York; Donna J. Luh, individually and in her official capacity as Vice-Chair of the New York State Thruway Authority Board of Directors; E. Virgil Conway, individually and in his official capacity as Board Member of the New York State Thruway Authority; Richard N. Simberg, individually and in his official capacity as Board Member of the New York State Thruway Authority; Brandon R. Sall, individually and in his official capacity as Board Member of the New York State Thruway Authority; J. Donald Rice Jr., individually and in his official capacity as Board Member of the New York State Thruway Authority; Jose Holguin-Veras, individually and in his official capacity as Board Member of the New York State Thruway Authority; John F. Barr, individually and in his official capacity as Director of Administrative Services of the New York State Thruway Authority; John M. Bryan, individually and in his official capacity as Chief Financial Officer and Treasurer of the New York State Thruway Authority; and Donald R. Bell, individually and in his official capacity as Director of Maintenance and Operations of the New York State Thruway Authority. Defendant New York State Thruway Authority is an independent public corporation created in 1950 by the New York State Legislature and was the employer of the Individual Plaintiffs. The Authority has a Division Headquarters located in Suffern, New York, and has various facilities in Orange, Westchester, and Rockland Counties. The Individual Defendants are officers or directors of the Authority. The Plaintiffs are represented by: Gregg D. Adler, Esq. LIVINGSTON, ADLER, PULDA, MEIKLEJOHN & KELLY, P.C. 557 Prospect Avenue Hartford, CT 06105-2922 Telephone: (860) 233-9821 E-mail: gdadler@lapm.org PARTNERSHIP HEALTH: Settles Wrongful Discharge Suits for $189,000 ----------------------------------------------------------------- David Erickson, writing for Missoulian, reports that earlier this spring, Missoula County agreed to pay four former employees of Partnership Health Center a total of $189,000 to settle lawsuits alleging the workers were wrongfully discharged and that the clinic's management created hostile working conditions, emotional distress and humiliation. Combined, it is the largest settlement the county has paid in at least the past three years. Former Partnership dental practice manager Patricia Morgan received $80,000, former medical director Alison Forney-Gorman received $62,500, former medical records coordinator Lisa Nelson received $22,500 and former medical receptionist Shawnel Trenary received $24,000. Ms. Morgan, Ms. Nelson and Ms. Trenary sued the county on May 3, 2013, in Missoula County District Court, and Ms. Forney-Gorman filed suit on Nov. 18, 2013. The settlement was reached March 25. All four women were represented by attorney Elizabeth Best of Great Falls, while the county was represented by law firm Garlington, Lohn and Robinson. The county was responsible for $141,716.48 in legal fees as well, but the settlement stipulated that the county was not admitting liability. The settlement money was paid from a risk fund specifically allocated for such purposes. Forney-Gorman's lawsuit alleged that Partnership executive director Kim Mansch "had established a hostile work environment through a culture of fear and intimidation through her management actions, refusing to sign off on time off requests, using abusive and threatening language to employees of PHC, etc., in violation of Missoula County's workplace harassment policy." Ms. Mansch and the county denied the allegations. Ms. Mansch declined to comment on the settlement. Forney-Gorman's settlement with the county stipulates that Partnershp's management and leadership teams must attend training on the Government Code of Fair Practices and training on human resource management issues, including "effective communication, training and supervision of employees, as well as interaction with union representatives." Partnership also must undergo a structural and management analysis and consider any subsequent recommendations. Its board of directors also must undergo training on human resource management issues, including "their duty to protect employees, and to effectively manage and supervise the executive director." Partnership is a nonprofit medical and dental clinic administered through the Missoula City-County Health Department and governed by the board of directors. The clinic employs about 120 staffers at the old Creamery Building in downtown Missoula and serves the under- or uninsured. PNEUMO ABEX: Has No Duty to Warn Employee's Nephew, Court Says -------------------------------------------------------------- Heather Isringhausen Gvillo, writing for Legal Newsline, reports that a California appeals court has held that a company's duty to warn of asbestos dangers extended to an employee's nephew who developed mesothelioma -- despite all other defendants in the case being the nephew's own employers, where he was exposed to asbestos occupationally. The trial court ruled that defendant Pneumo Abex owed no duty to the nephew, who alleges he was exposed to asbestos through contact with his uncle's work clothing. Abex argued that "no duty is owed [by an employer] to family members of workers for take-home exposures." However, the First Appellate District Court of Appeals disagreed, saying plaintiff Johnny Blaine Kesner, Jr., was a frequent visitor of his uncle's household, spending several nights a week in the home for several years. Using factors from the Rowland decision, the appeals court reversed the trial court's ruling. Judge Stuart Pollak delivered the opinion. Judges Peter Siggins and Martin Jenkins concurred. At the onset of trial, Abex moved for a nonsuit, arguing it had no duty to prevent Mr. Kesner's asbestos exposure. The Superior court agreed, granting Abex's motion for nonsuit. Mr. Kesner responded by filing an appeal. The appeals court expedited consideration of the issue due to Mr. Kesner's declining health. According to the May 15 opinion, Mr. Kesner was diagnosed with perotineal mesothelioma in February 2011. He filed an asbestos lawsuit against several defendants. However, every defendant except Abex consisted of companies Mr. Kesner worked for and was occupationally exposed to asbestos on their premises. All of those claims have been resolved. Only Abex remains. Mr. Kesner claims his uncle was an Abex employee from 1973 to 2007 and was exposed to asbestos while on the job. Between 1973 and 1979, Mr. Kesner was a frequent guest in his uncle's home, staying the night there several days a week. Mr. Kesner claims his uncle would come home and, while still in his dusty work clothes, play with Mr. Kesner or sleep near him, which contributed to his development of mesothelioma. Judge Pollak wrote that this case involves the "asserted liability of a negligence manufacturer to a plaintiff for injuries arising as a result of the plaintiff's exposure to a harmful substance through contact with the manufacturer's employee away from the manufacturer's premises." He added that individuals still have a duty to use ordinary care for their own safety and must use reasonable care in certain circumstances. The appeals court used the Rowland decision to analyze this take- home asbestos case, saying a number of factors must be considered: - The foreseeability of harm to the plaintiff; - A degree of certainty that the plaintiff suffered injury; - The closeness of the connection between the defendant's conduct and the injury suffered; - The moral blame attached to the defendant's conduct; - The policy of preventing future harm; - The extent of the burden to the defendant and consequences to the community of imposing a duty to exercise care with resulting liability for breach; and - The availability, cost and the prevalence of insurance for the risk involved. Judge Pollak noted that considering the Rowland factors as they relate to negligence claims does not lead to the conclusion that employers responsible for asbestos-exposures, failing to warn of asbestos dangers or failure to provide protective measures are not responsible to any nonemployee foreseeably affected by the asbestos exposure. The appeals court made it clear that finding a duty to warn is not the same thing as a finding of negligence. However, he added that contrary to its stance on negligence claims, the Rowland decision applies differently on duty-to-warn claims. The court found that the first three Rowland factors relate to and support extension of an employer's duty to warn beyond its employees. "As a general matter, harm to others resulting from secondary exposure to asbestos dust is not unpredictable," Judge Pollak wrote. "The harm to third parties that can arise from a lack of precautions to control friable asbestos that may accumulate on employees' work clothing is generally foreseeable." The fourth Rowland factor, relating to moral blame, also typically supports extension of an employer's duty to warn, he added. "Assuming, as we must, the truth of Kesner's allegation that Abex was aware of the risks to those exposed directly or indirectly to the asbestos dust generated in its facility and took no steps to avoid those risks, certainly such indifference would be morally blameworthy," he wrote. The Rowland decision also addresses prevention of future harm for other potential asbestos victims. The appeals court notes that holding an employer responsible for avoiding injuries to employees' families who may foreseeably be harmed by take-home asbestos exposures can help prevent harm to others in the future. The next Rowland factor -- the extent of the burden to the defendant and the consequences to the community if the court imposes too broad a duty -- has led the court to limit the reach of liability in the past. The appeals court recognizes that stretching liability too far can become unreasonable and burdensome. "It would be an entirely unreasonably burden on all human activity if the defendant who has endangered one man were to be compelled to pay for the lacerated feelings of every other person disturbed by reason of it, including every bystander shocked at an accident, and every distant relative of the person injured, as well as his friends," the opinion states. As a result, the courts determined a limit was needed on whom the duty of reasonably care extends. Because Mr. Kesner spent so much time near his uncle, the court held that it was reasonable to extend duty to the plaintiff. As for the last Rowland factor, previous courts held that the threat of unlimited liability "could restrict the ability of employees to obtain insurance, while individuals may obtain insurance covering medical expenses incurred as a result of illness arising from toxic exposure." However, the appeals court made it clear that there is no reason to believe that manufacturers cannot obtain insurance coverage to protect against their duty to warn liability. Analyzing each of the Rowland factors, the appeals court concluded that Abex still held duty-to-warn liability, noting that foreseeability of harm is the most significant factor to consider. He added that there is a high level of foreseeability of harm from take-home asbestos exposure, especially when Mr. Kesner's contact with his uncle's dusty work clothing was not incidental. The weight of the foreseeability factor is strengthened, Judge Pollak explained, when the moral blame factor is also attributable to Abex allegedly disregarding a known risk to others and the need to prevent future harm. "In weighing these competing considerations, the balance falls far short of terminating liability at the door of the employer's premises," Judge Pollak wrote. Judge Pollak explained that extending Abex's duty of care to Mr. Kesner does not threaten employers with potential liability for "intangible injuries" that could be alleged by an unlimited number of claimants, because mesothelioma claims cannot be claimed by everyone. Judge Pollak stated that the court reached its conclusion that Abex's duty of care extended to Mr. Kesner on the assumption that Kesner was a long-term guest in his uncle's home and had extensive contact with his uncle's dusty work clothing. However, the appeals court said it makes no opinion for cases other than the one on hand, as there are factual questions needed for future determination "As to such persons, the foreseeability of harm is substantial. As to persons whose contact with an employer's worker is only casual or incidental, the foreseeability of harm and the closeness of the connection between the defendant's conduct and the plaintiff's injury may be so minimal as to produce a different balance of the Rowland factors," he wrote. "We hold that there is a duty under the circumstances alleged in the present case, but we do not address other circumstances that are not before us." POM WONDERFUL: Faces Suit Over Deceptive Juice Labeling ------------------------------------------------------- Jenna Greene, writing for Legal Times, reports that another juice maker is under fire for making misleading claims on its product labels, a well-timed attack that coincides with the U.S. Supreme Court's decision on June 12 giving POM Wonderful LLC the go-ahead to sue competitor Coca-Cola Co. over deceptive juice labels. The Center for Science in the Public Interest on June 12 sent a letter to Campbell Soup Co. threatening to sue the company for making misleading claims about the juice content, nutritional value and overall healthfulness its V8 Splash and V8 V-Fusion Refreshers beverages. The juice labels prominently depict fruits and vegetables, but the products "contain mostly water along with artificial food dyes, high fructose corn syrup (or potentially harmful artificial sweeteners sucralose and acesulfame potassium in the diet variety) and only 5 percent to 10 percent juice," the center's litigation director, Stephen Gardner, wrote in the letter to Campbell chief executive officer Denise Morrison. The center faulted Campbell for packaging the drinks to look "almost graphically identical" to Original V8 juice, which is 100 percent vegetable juice, as well as its V-Fusion juice, which also contains 100 percent vegetable and fruit juices. "Campbell's motivation is that water, high-fructose corn syrup, and artificial sweeteners are cheaper to bottle than 100 percent juice made from tomatoes, carrots, strawberries, kiwis, and so on," Mr. Gardner said in a news release. The products are "designed to be convincing simulations of the real thing. It's an elaborate con designed to extract money from consumers who will likely think they're getting something else." Campbell spokesman Tom Hushen in an email said the company is still reviewing the letter. "We label all of our products in compliance with all laws and government regulations," he wrote. "All of the information that consumers need about the nutrition provided in a bottle of V8 V-Fusion Refreshers and V8 Splash is clearly provided on the label." The center also said Campbell falsely claims that that its V- Fusion line has "no added sugar," alleging that the V8 V-Fusion Refreshers do in fact contain sugar. Further, the center criticized Campbell for adding vitamins to the Splash products, alleging that doing so violates the FDA's fortification rule, which bars the addition of nutrients to nutritionally void or harmful beverages. "Absent improper fortification of V8 Splash products, Campbell could not represent the sugary juice drinks as nutritious, vitamin-rich products," Mr. Gardner wrote. He invited the company to "resolve these instances of illegal and deceptive marketing in order to avoid further legal action." The threat was issued as the U.S. Supreme Court ruled, 8-0, that POM Wonderful could sue Coca-Cola over the use of the words "Pomegranate Blueberry" on a Minute Maid label. POM argued this misleads consumers into believing that the product consists primarily of pomegranate and blueberry juices. In fact, the juice consists mainly of apple and grape juice (99.4 percent) blended with 0.3 percent pomegranate juice and 0.2 percent blueberry juice. PRIMARY FINANCIAL: Sued for Violating Fair Debt Collection Act -------------------------------------------------------------- Pearl Ehrnfeld, on behalf of herself and all other similarly situated consumers v. Primary Financial Services, LLC, as assignee of Pentagroup Financial, LLC, Case No. 1:14-cv-03749 (E.D.N.Y., June 15, 2014), alleges violations of the Fair Debt Collection Practices Act. The Plaintiff is represented by: Maxim Maximov, Esq. MAXIM MAXIMOV, LLP 1701 Avenue P Brooklyn, NY 11229 Telephone: (718) 395-3459 Facsimile: (718) 408-9570 E-mail: m@maximovlaw.com SCHNUCKS BAKERY: Issues Voluntary Recall of Devil's Food Cakes -------------------------------------------------------------- Tim Bryant, writing for St. Louis Post-Dispatch, reports that Schnucks Bakery issued a voluntary recall of its devil's food cakes decorated with pecans. The recall involves the pecans. Schnucks says that anyone with a pecan allergy who ate the affected product may be at risk of a serious reaction. A company review of the ingredient label showed that even though the pecans are visible on top of the cake -- and not baked inside -- the known allergen was not disclosed on the label, Schnucks says. The cakes were sold at all Schnucks supermarkets in Missouri, Illinois, Indiana, Wisconsin and Iowa. Here is some product information: -- Schnucks Bakery 8" Devil's Food Cake UPC: 04131831186 -- Schnucks Bakery 1/2 Devil's Food Cake UPC: 04131831078 Schnucks says it has no reports of illnesses associated with this recall. Customers concerned about a possible allergic reaction should contact their physicians. Customers may return the specified product to their nearest Schnucks store for a refund. Consumers with questions may call the Schnucks Consumer Affairs department at 314-994-4400 or 800-264-4400. SCIENTIFIC DRILLING: "Smith" Suit Moved From Wyoming to Texas ------------------------------------------------------------- The purported class action lawsuit styled Smith v. Scientific Drilling International Inc., Case No. 2:14-cv-00017, was transferred from the U.S. District Court for the District of Wyoming to the U.S. District Court for the Southern District of Texas (Houston). The Texas District Court Clerk assigned Case No. 4:14-cv-01685 to the proceeding. Plaintiff Gurney D. Smith alleges that the Company has a policy or practice of failing to properly compensate him and other similarly situated employees for all overtime hours worked. Scientific Drilling International Inc. is incorporated in Texas and headquartered in Houston, Texas. The Company is an independent service provider of drilling and navigation services to the oil and gas, mining and geothermal industries. The Plaintiff is represented by: Stephen L. Simonton, Esq. STEPHEN L. SIMONTON, P.C. 1222 - 11th Street Cody, WY 82414 Telephone: (307) 587-7010 Facsimile: (307) 587-2746 E-mail: office@simontonlaw.com - and - Shanon J. Carson, Esq. Sarah Schalman-Bergen, Esq. Alexandra L. Koropey, Esq. BERGER AND MONTAGUE PC 1622 Locust Street Philadelphia, PA 19103 Telephone: (215) 875-3000 Facsimile: (215) 875-4604 E-mail: scarson@bm.net sschalman-bergen@bm.net akoropey@bm.net - and - David A. Hughes, Esq. HARDIN & HUGHES, LLP 2121 14th Street Tuscaloosa, AL 35401 Telephone: (205) 344-6690 Facsimile: (205) 344-6188 E-mail: dhughes@hardinhughes.com - and - James A. Jones, Esq. BRUCKNER BURCH PLLC 8 Greenway Plaza, Suite 1500 Houston, TX 77046 Telephone: (713) 877-8788 E-mail: jjones@brucknerburch.com The Defendant is represented by: Bradley T. Cave, Esq. Brynn A. Hvidston, Esq. HOLLAND & HART LLP 2515 Warren Avenue, Suite 450 PO Box 1347 Cheyenne, WY 82003-1347 Telephone: (307) 778-4203 Facsimile: (307) 778-8175 E-mail: bcave@hollandhart.com bahvidston@hollandhart.com - and - Marlene C. Williams, Esq. Michael J. Woodson, Esq. Scott Robert McLaughlin, Esq. JACKSON WALKER L.L.P. 1401 McKinney, Suite 1900 Houston, TX 77010 Telephone: (713) 752-4571 Facsimile: (713) 308-4171 E-mail: mcwilliams@jw.com mwoodson@jw.com smclaughlin@jw.com SHRED-IT USA: Accused of Violating Fair Credit Reporting Act ------------------------------------------------------------ Michael Kirchner, an individual, on behalf of himself and all others similarly situated v. Shred-It USA, Inc., a Delaware Corporation, and First Advantage LNS Screening Solutions, Inc., Case No. 2:14-cv-01437-WBS-EFB (E.D. Cal., June 16, 2014), accuses the Defendants of violating the Fair Credit Reporting Act. The Plaintiff is represented by: Peter R. Dion-Kindem, Esq. PETER R. DION-KINDEM, P.C. 21550 Oxnard Street, Suite 900 Woodland Hills, CA 91367 Telephone: (818) 883-4900 Facsimile: (818) 883-4902 E-mail: peter@dion-kindemlaw.com SPECIALIZED LOAN: Suit Challenges Use of Automatic Dialing System ----------------------------------------------------------------- Gregory Grugnale, individually and on behalf of all others similarly situated v. Specialized Loan Servicing, LLC, Case No. 1:14-cv-12534-LTS (D. Mass., June 16, 2014), challenges the Company's alleged standardized practice of calling cellular telephones using an automatic telephone dialing system or a prerecorded voice without obtaining the subscriber's prior express consent, in violation of the Telephone Consumer Protection Act. Specialized Loan Servicing, LLC, is a Delaware limited liability company. SLS is wholly-owned by Specialized Loan Servicing Holdings, LLC, a company whose ultimate parent is Computershare Limited, a publicly traded company on the Australian stock exchange. A third party residential mortgage servicer, SLS has offices in Colorado, Georgia, and Arizona, and is licensed in all 50 states and the District of Columbia. The Plaintiff is represented by: Elizabeth Ryan, Esq. John Roddy, Esq. BAILEY & GLASSER LLP 125 Summer Street, Suite 1030 Boston, MA 02110 Telephone: (617) 439-6730 Facsimile: (617) 951-3954 E-mail: Eryan@baileyglasser.com Jroddy@baileyglasser.com - and - Preston W. Leonard, Esq. LEONARD LAW OFFICE, PC 63 Atlantic Avenue, 3rd Floor Boston, MA 02110 Telephone: (617) 329-1295 E-mail: Pleonard@theleonardlawoffice.com SOURCE REFRIGERATION: Refused to Pay Proper Overtime, Suit Claims ----------------------------------------------------------------- Sean Hamer, Individually and On Behalf of All Others Similarly Situated v. Source Refrigeration & HVAC, Inc., Case No. 1:14-cv- 00570 (W.D. Tex., June 17, 2014), alleges that the Defendant required or permitted the Plaintiff to work more than 40 hours in a workweek, but refused to compensate him for those hours at the overtime rate required under the Fair Labor Standards Act. Source Refrigeration & HVAC, Inc. is a foreign for-profit corporation. The Defendant is a service provider of refrigeration and HVAC systems for various customers throughout the United States. The Defendant contracts with companies, like grocery stores, to provide repair and maintenance to their refrigeration units used to store food. The Plaintiff is represented by: Gabriel A. Assaad, Esq. KENNEDY HODGES, L.L.P. 711 W. Alabama St. Houston, TX 77006 Telephone: (713) 523-0001 Facsimile: (713) 523-1116 E-mail: gassaad@kennedyhodges.com SWT ARIZONA: Fails to Pay Overtime Wages Under FLSA, Suit Claims ---------------------------------------------------------------- Travis Newton v. SWT Arizona Investments, LLC; Tanweer Ahmed and Jane Doe Ahmed, husband and wife; David Wehrman and Jane Doe Wehrman, husband and wife; ADS Foods, LLC, Case No. 2:14-cv-01330- GMS (D. Ariz., June 16, 2014), is brought against the Defendants for their alleged unlawful failure to pay overtime wages in direct violation of the Fair Labor Standards Act. SWT Arizona Investments, LLC, is Texas entity, doing business in Maricopa County, Arizona. The Individual Defendants are owners or officers of the Company. The Plaintiff is represented by: Trey Dayes, Esq. John L. Collins, Esq. Sean Davis, Esq. PHILLIPS DAYES LAW GROUP PC 3101 North Central Avenue, Suite 1500 Phoenix, AZ 85012 Telephone: (602) 288-1610 Facsimile: (602) 288-1664 E-mail: treyd@phillipsdayeslaw.com johnc@phillipsdayeslaw.com seand@phillipsdayeslaw.com TARSADIA HOTELS: Ruling in "Royalty Alliance" Suit Upheld --------------------------------------------------------- Royalty Alliance, Inc., Jane and Mike Bannister, Robert LeBorne and Louie and Rosemarie Linzaga (collectively plaintiffs) appealed the judgment entered after the court granted three summary adjudication motions of defendants and respondents Tarsadia Hotels (Tarsadia), 5th Rock, LLC (5th Rock), MKP One, LLC, Tushar Patel, B.U. Patel, and Gregory Casserly (collectively defendants). Plaintiffs separately appeal the order of the court awarding defendants attorney fees and costs. Plaintiffs were purchasers of condominiums in the Hard Rock Hotel San Diego, a condominium/hotel project (hotel). Defendant 5th Rock was the developer and seller of the condominium units (units), and Tarsadia was the hotel operator. Under the governing Purchase Contract and Escrow Instructions for Hard Rock Hotel & Condominiums (purchase contract), 5th Rock retained plaintiffs' purchase deposits after none of the plaintiffs closed escrow on the purchase of their units. Plaintiffs in response brought a class action lawsuit against defendants. The operative complaint asserted securities and fraud claims, a claim pursuant to Business and Professions Code section 17200 et seq., and claims for money had and received and invalid forfeiture based on defendants' retention of plaintiffs' purchase deposits. After several continuances, the court granted in part and denied in part defendants' motion for summary adjudication based on statute of limitation grounds, finding the first, second, third, fourth and sixth claims were time-barred; as to the fifth cause of action for violation of the unfair competition law (UCL) (Bus. & Prof. Code, Section 17200 et seq.; hereafter the UCL claim), the court found plaintiffs presented no evidence of alleged predicate bad acts; and finally as to the seventh claim for invalid forfeiture, it found the liquidated damages clause in the purchase contract was valid and enforceable. In an opinion dated May 29, 2014, a copy of which is available at http://is.gd/QTdyTMfrom Leagle.com, the Court of Appeals of California, Fourth District, Division One independently concluded that the court properly granted the motions for summary adjudication in favor of defendants and that the court properly exercised its discretion in awarding defendants their reasonable attorney fees and costs. Accordingly, the Calif. Appeals Court affirmed the judgment in favor of defendants based on the trial court's grant of their summary adjudication motions and the order awarding them attorney fees and costs. The defendants are awarded their costs of appeal. The case is ROYALTY ALLIANCE, INC. et al., Plaintiffs and Appellants, v. TARSADIA HOTELS et al., Defendants and Respondents, NOS. D062537 & D063402. Aguirre, Morris & Severson, Michael J. Aguirre -- maguirre@amslawyers.com -- Christopher S. Morris -- cmorris@amslawyers.com -- and Maria C. Severson -- mseverson@amslawyers.com -- for Plaintiffs and Appellants. Cox, Castle & Nicholson, Frederick H. Kranz -- rkranz@coxcastle.com -- and Lynn T. Galuppo -- lgaluppo@coxcastle.com -- for Defendants and Respondents. TRIANGLE AUTO: Fails to Pay Overtime Wages, Car Salesman Claims --------------------------------------------------------------- Gary Schultz and all others similarly situated under 29 U.S.C. 216(B) v. Triangle Auto Center, Inc., d/b/a Toyota of Hollywood, Case No. 0:14-cv-61378-KMW (S.D. Fla., June 15, 2014), alleges that the Plaintiff worked an average of 65 hours a week as a car salesman for the Defendant but was not paid any overtime wages whatsoever. Triangle Auto Center, Inc., doing business as Toyota of Hollywood, is a business that regularly transacts business within Broward County. The Plaintiff is represented by: David Markel, Esq. THE MARKEL LAW FIRM 3191 Grand Avenue #1531 Miami, FL 33133 Telephone: (305) 458-1282 Facsimile: (800) 407-1718 E-mail: David.Markel@markel-law.com UNITED HEALTHCARE: Sued for Denying Mental Health Claims -------------------------------------------------------- Kyla Asbury, writing for Legal Newsline, reports that United Healthcare is being sued by customers who allege it denied claims for mental health and substance abuse-related health benefits and violated the Mental Health Parity and Addiction Equity Act of 2008. United Healthcare and United Behavioral Health "systematically and improperly" denied mental health and substance abuse-related insurance benefit claims based on internal policies and practices that violated health insurance plans and the federal parity act, it is alleged. The defendants' "unlawful motives are clear -- to save the often high costs associated with the treatment of chronic conditions," according to a complaint filed May 21 in the U.S. District Court for the Northern District of California. David Wit, his daughter Natasha Wit and Brian Muir have insurance policies with the defendants and claim they have been denied coverage for mental health and/or substance abuse treatment by the Employee Retirement Income Security Act, which governs health plans administered by United Healthcare. The plaintiffs claim United Healthcare routinely violated plan terms covering mental health benefits by adjudicating claims "based on internal practices and policies that are much more restrictive than those generally accepted by the mental health community." United Healthcare also violated the federal parity act by imposing "disparate and more restrictive internal policies and practices" to claims for mental health and substance abuse benefits, according to the suit. The plaintiffs claim United Healthcare's internal policies effectively provided that coverage would be denied for residential treatment if a lower level of treatment would be safe, regardless of whether it would be similarly effective. The defendant's guidelines condition coverage for residential mental health treatment on "acute changes" in claimants' circumstances and do not provide for any consideration of chronically severe impairments that similarly warrant residential care, according to the suit. The plaintiffs claim the defendants' restrictive guidelines discriminate against patients with mental illness because they are not imposed upon patients seeking coverage for medical or surgical benefits. "United issues and administers many other fully-insured health insurance plans that define covered mental health services in the same way as the Wits' Plan," the complaint states. "The policies, practices and decisions that United made with respect to the claims filed by the Wits are the same as those that have been applied by United to other similarly situated insureds seeking mental benefits under their fully-insured health plans." United also serves as the claims administrator for many other self-insured health plans that define covered substance abuse services in the same way as Muir's Plan, according to the suit. "The policies, practices and decisions that United made with respect to the claims filed by Muir are the same as those that have been applied by United to other similarly situated insureds seeking substance use benefits under their self-insured health plans," the complaint states. The plaintiffs are seeking class certification and an order for United to recalculate and issue unpaid benefits to members of classes whose claims were underpaid or denied as a result of United's actions. They are being represented by Meiram Bendat of Psych-Appeal Inc.; D. Brian Hufford -- dbhufford@zuckerman.com -- and Jason S. Cowart -- jcowart@zuckerman.com -- of Zuckerman Spaeder LLP; and Anthony F. Maul -- afmaul@maulfirm.com -- of the Maul Firm PC. U.S. District Court for the Northern District of California case number: 3:14-cv-02346 US BANK: Homeowner Class Certified in Force-Placed Insurance Suit ----------------------------------------------------------------- Elizabeth Warmerdam at Courthouse News Service reports that a federal judge has certified a broad class of homeowners to challenge U.S. Bank's practice of force-placing insurance through its vendor, American Security Insurance Co. The June 13, 2014 order from U.S. Magistrate Judge Laurel Beeler certifies multistate classes of borrowers spanning 40 different states to pursue breach of mortgage agreement claims, and classes of borrowers in California and New Mexico to pursue claims of unjust enrichment, unfair business, practices, and bad faith. Stephen Ellsworth is the lead plaintiff in the class action alleging that U.S. Bank received kickbacks for having clients purchase force-placed flood insurance from American Security Insurance Co. (ASIC). U.S. Bank allegedly purchased flood insurance coverage that was significantly backdated and then charged borrowers for expired coverage, even when there was no damage to the borrowers' property during the backdated coverage period. Additionally, Ellsworth claims that the coverage predated any notice that their coverage had lapsed or was deficient. The collusive scheme allegedly brought U.S. Bank and ASIC extra income, while borrowers paid grossly inflated amounts for flood insurance coverage that provided them little to no benefit. Among the three multistate classes Beeler certified, the lender- placed class and qualified-expense-reimbursements (QER) class challenge the alleged kickbacks U.S. Bank received. The third class challenges the alleged backdating. Each class also has two subclasses, one for states with contract laws similar to California's contract law and one for states with contract laws similar to New Mexico's contract law. Separate classes were also certified for the noncontract state-law claims under California and New Mexico law based on the same three theories. These classes have limitations that exclude borrowers whose force-placed flood insurance charges were refunded or extinguished through bankruptcy, foreclosure or any other means. Beeler found that commonality exists in the classes, as the homeowners allege that they had identical form contracts, the policies were applied uniformly, and form notices were sent about the force-placed insurance and the charges. Furthermore, they "allege a common scheme to force place insurance on borrowers in a way designed to increase kickbacks to U.S. Bank from a captive insurance provider (ASIC) in the form of QERs or discounted tracking services, and to maximize costs collected from borrowers by force-placing LPFI policies that were backdated more than 60 days," the 56-page ruling states. Beeler also pointed out that the "challenged practices are the same, the insurer ASIC is the same, and the legal issues generally are the same: were the practices lawful under the standard mortgage contract or under state laws regarding the implied covenant of good faith and fair dealing, unjust enrichment, or unfair competition." Purported variations in state laws do not preclude certification of the multistate classes, as the contract laws of the various states are capable of being organized into groups with similar legal regimes, according to the ruling. The multistate breach-of-contract claim will advance as well, Beeler said, finding that the named plaintiffs have standing to assert the claim based on an identical form contract on behalf of class members in states with similar contract laws. Though U.S. Bank highlighted a recent amendment to the National Flood Insurance Act clarifying that borrowers can be charged for backdated coverage, Beeler refused to grant it judgment on the pleadings regarding the backdating claims. The amendment is ambiguous as to whether insurance can be force- placed back to the beginning of a 45-day notice period, and in this case, the homeowners limit their backdating claims to insurance force-placed retroactively 61 days or more after notice, according to the ruling. The court cannot rule as a matter of law "that the amendment manifests Congress's intent to provide blanket permission to backdate insurance, no matter how far outside the 45-day notice period," Beeler wrote. In response to the ruling, class counsel Kai Richter with Nicholas Kaster, said, "We are pleased with the court's decision, which allows thousands of U.S. Bank borrowers to have their claims heard. We look forward to representing the classes." The case is Stephen Ellsworth, Marilyn Weaver, and Lawrence and Donene Skelley, individually and as representatives of the classes and on behalf of the general public v. U.S. Bank, N.A., and American Security Insurance Company, Case No. C 12-02506 LB, in the U.S. District Court for the Northern District of California, San Francisco Division. VERIZON WIRELESS: Sanctions Denial in Text Messaging MDL Appealed ----------------------------------------------------------------- The Plaintiffs in the multidistrict litigation known as In re Text Messaging Antitrust Litigation, MDL No. 1997, appeal to the United States Court of Appeals for the Seventh Circuit from the memorandum opinion and order entered by the United States District Court for the Northern District of Illinois: (i) denying the Plaintiffs' motion for an adverse inference jury instruction and sanctions for spoliation of evidence; and (ii) granting summary judgment to the Defendants (entered on May 19, 2014), and the resulting Judgment entered on May 19, 2014. The Plaintiffs filed the underlying litigation on behalf of all those who purchased text-messaging services on a fee-per-text- message basis directly from four of the five Defendants: AT&T Mobility L.L.C., Sprint Nextel Corporation, T-Mobile USA, Inc., and Verizon Wireless. The Plaintiffs allege that these national wireless communications service providers, along with Defendant CTIA-The Wireless Association, entered into and implemented a continuing contract, combination, and conspiracy to fix, raise, maintain, and stabilize prices for Text Messaging Services sold in the United States in violation of the Sherman Act. In their motion for sanctions, the Plaintiffs contend that certain Defendants engaged in spoliation of evidence, and the Plaintiffs moved for sanctions and an adverse inference. On May 19, 2014, the District Court denied the Plaintiffs' motion for an adverse inference and sanctions and granted the Defendants' motion for summary judgment. A judgment in favor of the Defendants was subsequently entered. The Plaintiffs-Appellants are Aircraft Check Services Company, Nicholas Iltsopoulos, David Keefer, Jim Morris, Premiere Investment Consulting and Melissa Leigh Randolph. The Plaintiffs-Appellants are represented by: Patrick J. Coughlin, Esq. David W. Mitchell, Esq. Randi D. Bandman, Esq. Steven M. Jodlowski, Esq. Lonnie A. Browne, Esq. ROBBINS GELLER RUDMAN & DOWD LLP 655 West Broadway, Suite 1900 San Diego, CA 92101 Telephone: (619) 231-1058 Facsimile: (619) 231-7423 E-mail: patc@rgrdlaw.com davidm@rgrdlaw.com randib@rgrdlaw.com sjodlowski@rgrdlaw.com lbrowne@rgrdlaw.com - and - Fred Isquith, Esq. Thomas H. Burt, Esq. WOLF HALDENSTEIN ADLER FREEMAN & HERZ, LLP 270 Madison Avenue New York, NY 10016 Telephone: (212) 545-4600 Facsimile: (212) 545-4653 E-mail: isquith@whafh.com burt@whafh.com - and - Marvin A. Miller, Esq. Lori A. Fanning, Esq. MILLER LAW LLC 115 S. LaSalle Street, Suite 2910 Chicago, IL 60603 Telephone: (312) 332-3400 Facsimile: (312) 676-2676 E-mail: MMiller@MillerLawLLC.com LFanning@MillerLawLLC.com - and - Mary Jane Fait, Esq. LAW OFFICES OF MARY JANE FAIT 115 S. LaSalle Street Chicago, IL 60603 Telephone: (847) 922-6729 E-mail: maryjane15@me.com - and - Christopher Lovell, Esq. LOVELL STEWART HALEBIAN JACOBSON LLP 61 Broadway, Suite 501 New York, NY 10006 Telephone: (212) 608-1900 Facsimile: (212) 719-4677 - and - Joe R. Whatley, Esq. WHATLEY KALLAS, LLC 1180 Avenue of the Americas, 20th Floor New York, NY 10036 Telephone: (212) 447-7060 Facsimile: (800) 922-4851 E-mail: jwhatley@whatleykallas.com - and - Daniel E. Becnel, Esq. BECNEL LAW FIRM, LLC P.O. Drawer H 106 West Seventh Street Reserve, LA 70084 Telephone: (985) 536-1186 Facsimile: (985) 536-6445 E-mail: dbecnel@becnellaw.com - and - Dianne M. Nast, Esq. NASTLAW, LLC 1101 Market Street, Suite 2801 Philadelphia, PA 19107 Telephone: (215) 923-9300 Facsimile: (215) 923-9302 E-mail: dnast@nastlaw.com - and - Bryan Clobes, Esq. CAFFERTY FAUCHER LLP 1717 Arch Street, 36th Floor Philadelphia, PA 19103 Telephone: (215) 864-2800 Facsimile: (215) 864-2810 E-mail: bclobes@caffertyclobes.com - and - Robert M. Foote, Esq. FOOTE, MEYERS & FLOWERS, LLC 28 North First Street, Suite 2 Geneva, IL 60134 Telephone: (630) 232-6333 Facsimile: (630) 845-8982 - and - Kevin A. Seely, Esq. ROBBINS ARROYO LLP 600 B Street, Suite 1900 San Diego, CA 92101 Telephone: (619) 525-3990 Facsimile: (619) 525-3991 E-mail: kseely@robbinsarroyo.com - and - Michelle L. Kranz, Esq. ZOLL, KRANZ & BORGESS, LLC 6620 West Central Avenue, Suite 100 Toledo, OH 43617 Telephone: (419) 841-9623 Facsimile: (419) 841-9719 - and - Shpetim Ademi, Esq. ADEMI & O'REILLY, LLP 3620 East Layton Avenue Cudahy, WI 53110 Telephone: (414) 482-8000 Facsimile: (414) 482-8001 E-mail: sademi@ademilaw.com Defendant-Appellee Verizon Wireless is represented by: Dan K. Webb, Esq. Christopher B. Essig, Esq. Dana E. Schaffner, Esq. Jennifer L. Maurer, Esq. John W. Christopher, Esq. Thomas James Frederick, Esq. WINSTON & STRAWN LLP 35 West Wacker Drive Chicago, IL 60601-9703 Telephone: (312) 558-5600 E-mail: dwebb@winston.com cessig@winston.com dschaffner@winston.com jmaurer@winston.com JChristopher@winston.com tfrederick@winston.com - and - Charles Bennett Molster, III, Esq. WINSTON & STRAWN LLP 1700 K Street, NW Washington, DC 20006 Telephone: (202) 282-5988 Facsimile: (202) 282-5100 E-mail: cmolster@winston.com - and - Aaron Martin Panner, Esq. KELLOGG HUBER HANSEN TODD EVANS & FIGEL 1615 M Street, N.W., Suite 300 Washington, DC 20036 Telephone: (202) 326-7921 Facsimile: (202) 326-7999 E-mail: apanner@khhte.com Defendant-Appellee T-Mobile USA, Inc., is represented by: Charles H. R. Peters, Esq. Lawrence Harris Heftman, Esq. SCHIFF HARDIN LLP 233 South Wacker Drive, Suite 6600 Chicago, IL 60606 Telephone: (312) 258-5500 E-mail: cpeters@schiffhardin.com lheftman@schiffhardin.com - and - Christopher B. Hockett, Esq. Stephanie E. L. McCleery, Esq. DAVIS POLK & WARDWELL 1600 El Camino Real Menlo Park, CA 94025 Telephone: (650) 752-2009 E-mail: chris.hockett@dpw.com stephanie.lockwood@dpw.com - and - Micah G. Block, Esq. Sandra W. Neukom, Esq. DAVIS POLK & WARDWELL LLP 1600 El Camino Road Menlo Park, CA 94025 Telephone: (650) 752-2023 E-mail: micah.block@davispolk.com sandra.west@davispolk.com Defendant-Appellee Sprint Nextel Corporation is represented by: Dane H. Butswinkas, Esq. Jason T. Wright, Esq. John E. Schmidtlein, Esq. Megan Anne Siddall, Esq. R. Hackney Wiegmann, Esq. Sarah F. Teich, Esq. WILLIAMS & CONNOLLY LLP 725 12th Street, NW Washington, DC 20005 Telephone: (202) 434-5110 E-mail: DButswinkas@wc.com JTWright@wc.com JSchmidtlein@wc.com msiddall@wc.com HWiegmann@wc.com steich@wc.com - and - Frederic R. Klein, Esq. GOLDBERG KOHN LTD. Mid-Continental Plaza 55 East Monroe Street #3300 Chicago, IL 60603 Telephone: (312) 201-4000 E-mail: frederic.klein@goldbergkohn.com Defendant-Appellee AT&T Mobility L.L.C. is represented by: Brian A. McAleenan, Esq. John W. Treece, Esq. Linton Jeffries Childs, Esq. Veena K. Gursahani, Esq. SIDLEY AUSTIN LLP One South Dearborn Street Chicago, IL 60603 Telephone: (312) 853-7000 E-mail: bmcaleenan@sidley.com jtreece@sidley.com lchilds@sidley.com vgursahani@sidley.com - and - Marc W.F. Galonsky, Esq. BELLSOUTH CORPORATION 1155 Peachtree St., N.E. Atlanta, GA 30309-3610 Telephone: (404) 249-2458 E-mail: marc.galonsky@att.com Defendant-Appellee CTIA - The Wireless Association is represented by: Julia D. Riedel Emfinger, Esq. Lucia Lynn Marker-Moore, Esq. Ruth A. Bahe-Jachna, Esq. GREENBERG TRAURIG, LLP 77 West Wacker Drive, Suite 3100 Chicago, IL 60601 Telephone: (312) 456-8400 E-mail: emfingerj@gtlaw.com markermoorel@gtlaw.com baher@gtlaw.com - and - Michael D. McNeely, Esq. LAW OFFICES OF MICHAEL D. MCNEELY 2748 Stephenson Ln., NW Washington, DC 20015 Telephone: (202) 966-0428 E-mail: mikemcneely@mac.com The appellate case is Aircraft Check Services Company, et al. v. Verizon Wireless, et al., Case No. 14-2301, in the U.S. Court of Appeals for the Seventh Circuit. ZUMIEZ INC: Calif. Court Approves Deal in "Steele" Labor Suit ------------------------------------------------------------- The Superior Court of the State of California, County of San Francisco granted primary approval to a $1.3 million settlement reached in the labor suit Steele v. Zumiez Inc., according to the company's May 28, 2014, Form 10-Q filing with the U.S. Securities and Exchange Commission for the quarter ended May 3, 2014. On February 15, 2013, a putative class action lawsuit, Robert Steele v. Zumiez Inc., was filed against the Company in the Superior Court of the State of California, County of San Francisco. The lawsuit purports to be brought on behalf of a class of all persons who are employed, or who have worked as, assistant store managers for the Company in the State of California from February 15, 2009 through the date of certification of the class in the lawsuit. The lawsuit alleges causes of action for failure to pay overtime wages, failure to pay wages for work done off-the- clock, failure to provide meal periods and rest breaks (and to pay meal and rest period premiums), failure to pay terminated employees all wages due at the time of termination, failure to provide employees with accurate itemized wage statements, failure to reimburse employees for business expenses and unfair business practices and declaratory relief. The Court has not set a date for a hearing on class certification and has not set a trial date. A second putative class action lawsuit, Ruben Hernandez v. Zumiez Inc., was filed on September 3, 2013, alleging overlapping causes of action. On or about October 22, 2013, the class action allegations for the Hernandez case were dismissed without prejudice. On November 12, 2013, the parties in the Steele case agreed to a conditional settlement in the amount of $1.3 million which is contingent upon the preliminary and final approval of the Court (the "Conditional Settlement"). The parties have negotiated and executed a formal settlement agreement that is subject to the Court's approval. A motion for preliminary approval of the settlement was held on May 22, 2014 and was granted by the Court. The settlement was recorded in selling, general and administrative expenses on the condensed consolidated statements of income for the fiscal year ended February 1, 2014. * Firms Can No Longer Claim Safe Harbor in False Labeling Suits --------------------------------------------------------------- Marcia Coyle, writing for The National Law Journal, reports that food and beverage companies and others would be wise to take a long, hard look at their product labels in light of a U.S. Supreme Court decision clearing the way for competitors to allege those labels are false or misleading. "As a marketing lawyer, it's a really significant decision for the industry," said Linda Goldstein, chairwoman of the advertising, marketing & media division at Manatt, Phelps & Phillips. "All marketers now will have to take a much closer look at the claims they make and perhaps didn't look at through the same lens [as the Supreme Court]. It will certainly cause a greater degree of due diligence of their packaging and labeling claims." The unanimous ruling on June 12 in POM Wonderful v. Coca-Cola is unlikely to trigger a tidal wave of lawsuits under the Lanham Act, according to legal experts. The federal law allows a business allegedly injured by a competitor's false or misleading advertising of its products to bring a civil lawsuit. Litigation will increase, the experts predicted, because companies can no longer claim a safe harbor from those suits simply because the U.S. Food and Drug Administration authorized their labels. And the same approach used by the high court to resolve the legal battle between POM Wonderful LLC and The Coca-Cola Co. over Coke's pomegranate blueberry juice label could apply in other industries in which a federal agency regulates advertising. "I think there's a reasonable argument the same logic in this decision could apply in some other spheres -- pharmaceuticals, alcoholic beverages," said Paul Llewellyn, co-leader of Kaye Scholer's trademark, copyright and false-advertising group. "This is a template. This will guide decisions in those areas." Brett Heavner, partner in Finnegan, Henderson, Farabow, Garrett & Dunner, agreed, adding, "There are a lot of other agencies in the federal government that have a say in the advertising in industries they regulate -- the FDIC and how banks advertise services; the FCC in the telecommunications industry. "To the extent someone was going to try to make a similar argument to Coca-Cola's -- that their advertising was insulated from these claims because of federal regulations -- I think they will have a harder time," he said. POM sued Coca-Cola under the Lanham Act in 2008. POM claimed that Coke's use of the words "Pomegranate Blueberry" on its label misleads consumers into believing that the product consists primarily of pomegranate and blueberry juices. In fact, the drink consists mainly of apple and grape juice (99.4 percent) blended with 0.3 percent pomegranate juice and 0.2 percent blueberry juice. The U.S. Court of Appeals for the Ninth Circuit sided with Coke, holding that Coke's label complied with regulations under the Food, Drug, and Cosmetic Act (FDCA), as amended by the Nutrition Labeling and Education Act, and that the agency authorization of the label preempted the Lanham Act claims. In April arguments before the justices, Coke's counsel, Kathleen Sullivan of Quinn Emanuel Urquhart & Sullivan, argued that the two federal laws -- the FDCA and the Lanham Act -- were in conflict and the food law should prevail. "Just to be clear, what Congress wanted was national uniformity so that a manufacturer could print one label and sell in the 50 states and not have its juice legal when you leave on the flight in California and illegal when you land in D.C.," she argued. But POM's counsel, Seth Waxman of Wilmer Cutler Pickering Hale and Dorr, insisted there was no conflict. "Here, Congress has never precluded or conditioned enforcement of the Lanham Act in food- labeling cases. And it is entirely possible -- in fact, entirely easy -- for Coke to comply with both statutory obligations," Waxman said. Justice Anthony Kennedy, writing for an 8-0 court (Justice Stephen Breyer did not participate), rejected all of Coke's arguments as well as the Obama administration's argument that a Lanham Act claim was precluded to the extent the FDCA or FDA regulations specifically require or authorize the challenged aspects of the label. "The Lanham Act and the FDCA complement each other in major respects, for each has its own scope and purpose," Justice Kennedy wrote. "Although both statutes touch on food and beverage labeling, the Lanham Act protects commercial interests against unfair competition, while the FDCA protects public health and safety." Justice Kennedy said nothing in the text, history or structure of the FDCA or the Lanham Act showed that Congress intended to forbid Lanham Act suits. In fact, he said, the two laws have co-existed for 70 years and Congress never acted to bar Lanham Act suits in this context. He also rejected the government's "middle ground" argument that Lanham Act suits are barred when the FCDA or FDA regulations specifically authorize the challenged aspects of a label. The government, he said, wrongly assumed that those FDA regulations are a ceiling. That part of the decision is the most important, said Harold Weinberger, head of the advertising group at Kramer Levin Naftalis & Frankel. "Just because the FDA says you can do it doesn't mean a competitor can't come in and show it's misleading." David Ter Molen, a partner in the food industry team at Chicago's Freeborn & Peters, agreed. "Before, food companies effectively had a safe harbor. But the ruling said FDA regulations are not a ceiling, but effectively a floor. Now there is a risk a Lanham Act claim could be brought against that type of label. The risk is something greater than zero. What that number is going to be depends on what the product is." The justices did not specifically address what happens with such claims are brought by consumers in state-law consumer fraud class actions, which "are proliferating like rabbits," Mr. Weinberger said. Manatt Phelps' Goldstein said, "Class action litigation has been heavily targeted at the food and beverage industry. By the court leaving that issue open, the industry hasn't achieved the stopgap to the proliferation of class actions had there been a broad favorable ruling in favor of Coke." POM now has the opportunity to prove that Coke's label is misleading. * Defendants Must Step Up Fight in Data Breach Class Actions ------------------------------------------------------------ Gina Passarella, writing for The Legal Intelligencer, reports that plaintiffs are increasingly winning in the earlier stages of data breach litigation and defendants may be helping set unrealistic settlement figures out of a fear of going through discovery, attorneys on both sides of the issue said on June 12. "Instead of thinking of ways to make [the plaintiffs lawyer's] life more difficult and fight class certification, people are settling," said Baker & Hostetler data privacy lawyer Theodore J. Kobus III -- tkobus@bakerlaw.com Mr. Kobus was speaking on a panel to a Philadelphia ballroom full of cybersecurity professionals attending NetDiligence's annual Cyber Risk and Privacy Liability Forum. "Are we going to stand up and challenge them on class certification and summary judgment?" asked Ronald I. Raether Jr. -- rraether@ficlaw.com -- a partner at Dayton, Ohio-based Faruki Ireland & Cox. Chandler Givens of Edelson P.C. was the lone plaintiffs lawyer on the panel -- and the subject of a lot of lighthearted ridicule from the other panelists. But he may be getting the last laugh as courts across the country, regardless of state politics or which administration appointed the judge, are increasingly demonstrating what Mr. Raether described as a lack of patience with companies' handling of data. Mr. Raether said judges are willing to make "legally obtuse" arguments to "fit a square peg into a round hole." From Mr. Givens' perspective, courts are beginning to realize the impact that data breaches have on those affected. So when a proposed class of plaintiffs say their data was breached, but they have yet to suffer harm, judges are increasingly finding that those plaintiffs still have standing to sue. "Now the standing issue is becoming a hurdle that we're able to surmount," Mr. Givens said. And while most defendants look to settle before discovery, Mr. Givens said some are pressing forward. And the judges who are hearing arguments over class certification are starting to approve the class, he said. But for plaintiffs lawyers, it's all about adapting. Mr. Givens likened plaintiffs data-breach litigation to Pac-Man -- when the ghost comes, you run the other way. "There is always going to be a way to plead your case based on what is happening in other circuits and we're going to find those and latch onto them," Mr. Givens said. Mr. Kobus said these cases don't have to be about fear. He said plaintiffs are "preying on" defendants' fear by using "outdated" statutory damages claims. The damages and settlement processes for data-breach class actions are just starting to evolve, Mr. Givens said. He noted one case he settled involved a $1.2 million settlement for a class of 750,000 people while another case involving 20,000 potential class members settled for $3.3 million. Pricing is difficult, particularly when actual harm hasn't occurred yet, Mr. Givens said. But courts have shown skepticism toward settlements that consist only of credit monitoring, he said. "You are essentially filing a lawsuit knowing you have a class that doesn't have damages," said Robert Parisi, managing director and national cyber-risk practice leader for insurance and risk management company Marsh. Mr. Parisi said data privacy laws in the United States focus more on who to blame for spilling the milk rather than the laws around the world that focus on stopping the milk from spilling. Mr. Kobus said the price points for a data breach will be what the various settlements bear out until defendants start pushing these cases and doing discovery to uncover the true damages. "We have to litigate and force them to prove damages," Mr. Raether said. Mr. Givens said any business that stores consumer or business data is a potential target for a breach and a lawsuit. He said he included business data because he could see a class of merchants suing over their data being breached. Finding clients is "trivial these days," Mr. Givens said. When a breach occurs, a state attorney general will typically put a notice on the office's website or the breach will be mentioned publicly in some fashion. Plaintiffs lawyers then buy Google AdWords so that an ad with an intake form to become part of the class is posted near search results about a certain company's breach. Mr. Givens said it is important for companies to have a consistent message between what it says in its breach notification letter, what it tells the general public and what its lawyers are saying. If one message says there were 50,000 people affected by the breach and another says there were 20,000, Mr. Givens said he could paint the picture for the court that the company doesn't have a handle on its data. The first thing plaintiffs lawyers ask for is the company's written security policy and vendor management contracts. "If you live by your policy, it's difficult for us to make a case," Mr. Givens said. Mr. Raether noted plaintiffs are arguing in some cases that it is the company's own privacy policy that should be the standard to which it is held against, but there are other standards too. What the judge will use becomes the question. Robin Campbell -- rcampbell@crowell.com -- an attorney with Crowell & Moring and founder of Click 4 Compliance, said the biggest trend since the highly publicized Target data breach has been on cleaning up vendor contracts and ensuring vendors are going to pay if they are the cause of a company's breach. It's an area regulators are highly tuned into as well, Ms. Campbell said. Mr. Kobus noted there is a lot more pushback from vendors now, however, in an attempt to limit their liability. Cyberinsurance policies are also attempting to ensure vendors have the financial wherewithal to assume that liability, he said. Mr. Parisi said more people have data breaches than have cyberinsurance. He said companies are trying to fit the damages of a data breach into the coverage of a commercial general liability policy and insurers are fighting that hard. Mr. Campbell said it is important not to mess up the breach notice. Companies don't want to look weak or like they are admitting liability. Mr. Kobus said words should be chosen carefully. Mr. Parisi and Ms. Campbell noted it's most important to have strong standards in place before a breach and follow those standards. If companies do the right compliance upfront, Ms. Campbell said, they can be more confident in negotiations. Mr. Raether had a simple approach to managing data breaches: "Don't piss people off." While Mr. Givens may have made it seem easy to find clients, cases that go the furthest have strong lead plaintiffs with actual damages to show, Mr. Raether said. A company may want to isolate those affected by the data breach who were most deeply affected and give them a remedy that makes them not want to pursue litigation, Mr. Raether said. While companies are currently battling large-scale class actions, the trend may be moving toward smaller, state court cases or individual cases, the attorneys said. Mr. Raether said plaintiffs want to take on manageable cases and the smaller, state cases are a good target. Mr. Givens said he expects to see more cases based on the representations made by defendants about their data security policies and their failure to adhere to them. Mr. Kobus said he thinks single-plaintiff Health Insurance Portability and Accountability Act cases will increase. Mr. Parisi said he would play the devil's advocate and suggest there may be less data breach litigation. He said millennials have a different take on privacy and what information is available. He said they may not want to sue over a data loss. But Mr. Parisi noted litigation is only the tip of the iceberg for companies that experienced a data breach. There are business interruption and reputational issues, to name a few. * Discovery Rules in Lead Paint & Toxic Tort Suits Clarified ------------------------------------------------------------ John Caher, writing for New York Law Journal, reports that clarifying the rules of discovery in lead paint and toxic tort cases, the Court of Appeals on June 12 held that plaintiffs do not have to establish causation at the earliest litigation stages by providing detailed medical records supporting each allegation of harm. In an opinion by Chief Judge Jonathan Lippman, the court said a trial judge in Monroe County erred in requiring plaintiffs to produce medical reports, prior to defense medical examinations, establishing a professional diagnosis for each and every alleged injury. "To the extent that plaintiffs are arguing that the rule does not obligate them to hire a medical provider to examine them and create a report solely for purposes of the litigation, we agree," Judge Lippman wrote. "Requiring a personal injury plaintiff to hire a medical professional to draft a report purely to satisfy [the statute] could make it prohibitively expensive for some plaintiffs to bring legitimate personal injury suits." The ruling resulted from two appeals out of Monroe County, where Supreme Court Justice Matthew Rosenbaum had directed lead paint plaintiffs to produce medical reports connecting their injuries to lead. Justice Rosenbaum had held that if the plaintiffs failed to provide that information before the defense medical examinations, they could not introduce any proof related to alleged injuries. The Appellate Division, Fourth Department, upheld Justice Rosenbaum in both cases, but the Court of Appeals agreed with a dissenting justice, Gerald Whalen, saying the lower courts imposed more of a burden than is required under 22 NYCRR 202.17. Hamilton v. Miller, 113, and Giles v. Yi, 114, both stemmed from personal injury actions brought by attorney Mo Athari, whose practice in Utica concentrates on lead paint cases. In both cases, Mr. Athari filed what the Court of Appeals described as "boilerplate" bills of particulars alleging dozens of injuries but without disclosing medical records substantiating those injuries. And in both cases, defense counsel convinced Justice Rosenbaum to order the plaintiffs to document the alleged injuries, under threat of preclusion. The Fourth Department, in a memorandum, affirmed Justice Rosenbaum, finding that the trial court properly exercised its discretion and that "defendants should not be put to the time, expense and effort" of conducing an independent medical examination without reports linking the plaintiff's symptoms to the defendants' alleged negligence. It said the purpose of CPLR 3121(a) was to provide the defendant with a "competing assessment" of the plaintiff's medical condition. Justice Whalen, in a signed dissent, said the trial order imposed "unduly burdensome obligations" on the plaintiff. He said the statute only requires disclosure of medical reports from providers who have previously treated the plaintiff, and does not require the plaintiff to retain an expert witness on causation prior to the defense's medical examination. Judge Lippman said the "dearth of medical evidence" in the Hamilton and Giles cases suggests that neither of the plaintiffs were treated for many of the injuries alleged in Mr. Athari's complaints, raising a question of just what must be disclosed under Rule 202.17. "If plaintiff's medical reports do not contain the information required by the rule, then plaintiffs must have the medical providers draft reports setting forth that information," Judge Lippman wrote. "If that is not possible, plaintiffs must seek relief from disclosure and explain why they cannot comply with the rule." Judges Victoria Graffeo, Susan Phillips Read, Eugene Pigott Jr., Jenny Rivera and Sheila Abdus-Salaam joined Judge Lippman. Judge Robert Smith dissented, adopting the reasoning in the Fourth Department majority memorandum. Mr. Athari argued the appeals for both Hamilton and Giles. The respondents in Hamilton were represented by Thomas Reidy, a partner at Ward Greenberg Heller & Reidy in Rochester, and Stanley Sliwa of Sliwa & Lane in Buffalo. In Giles, the respondents were represented by Gary Abelson, a partner at Hiscock & Barclay in Rochester, and William Wingertzahn, formerly a partner at Wilson Elser Moskowitz Edelman & Dicker in White Plains. Also on June 12, the court affirmed the Appellate Division, Second Department, in a Long Island case involving the use of public parkland for non-park purposes. It held that the plaintiffs can challenge the alleged violation of the public trust as long as the violation endures, with no statute of limitations bar. Capruso v. Village of Kings Point/ State of New York v. Village of Kings Point, 102, is rooted in a dispute over parkland on the Great Neck Peninsula. Records show that the Village of Kings Point acquired 173 acres of wooded land in the 1920s to create the Kings Point Park, which was leased to the Great Neck Park District in 1938 with the understanding that it would be maintained as a "natural and scenic park." In 1946, the lease was amended to exclude the western corner because the village wanted to use that portion for a police pistol range and to store highway materials. The conflict centers on a proposal the village adopted in 2008 to deforest the western corner and build a 12,000-square-foot public works facility. Neighbors objected, arguing that state legislative approval was necessary before public parkland could be used for non-park purposes; the state later brought its own action. The village argued that the consolidated claims were time-barred, but the lower courts disagreed in an opinion affirmed by the Court of Appeals. "In sum, under the continuing wrong doctrine, plaintiffs are able to challenge defendants' ongoing violation of the public trust doctrine at any time while the violation lasts, without being barred by the statute of limitations," Mr. Pigott wrote for the unanimous court. John Brickman, a partner at Ackerman, Levine, Cullen, Brickman & Limmer in Great Neck, argued for the village. Assistant Solicitor General Bethany Davis Noll represented the state. Reed Super of the Super Law Group in Manhattan argued for the individual plaintiffs. ********* 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. 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 2014. 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 202-241-8200. * * * End of Transmission * * *