/raid1/www/Hosts/bankrupt/CAR_Public/210428.mbx
C L A S S A C T I O N R E P O R T E R
Wednesday, April 28, 2021, Vol. 23, No. 79
Headlines
1INMM LLC: Misapplied Investor Funds, Whitmore Suit Says
AMAZON.COM SERVICES: Thomas Sues Over Unpaid OT for Delivery Staff
APPLE INC: Price Sues Over Unfair Apple ID Termination Provision
ARON SECURITY: Sattyakam Sues Over Unpaid Wages for Security Guards
BEENVERIFIED LLC: Pittman Sues for Illegal Use of Personal Info
BIBOX GROUP: Court Grants Bid to Dismiss Amended Securities Suit
CONSUMER CELLULAR: Geary Sues Over Unpaid OT for Call Center Agents
EBANG INTERNATIONAL: Faces Zeva Suit Over Misleading Statements
ELANCO ANIMAL: Seresto Collars Harmful to Pets, Revolinsky Alleges
GENERAL MOTORS: Torres Sues Over Chevy Bolt's Battery Defect
HANKEY INVESTMENT: Castellanos Sues Over Wage-and-Hour Violations
JOINT CORP: Vlad Sues Over Unsolicited Robocalls and Text Messages
KAISER FOUNDATION: Faces Stewart Suit Over Race Discrimination
MCDERMOTT INT'L: S.D. Texas Denies Bid to Dismiss Edwards Suit
MFK MOBILELINK: Compensation System Unlawful, Moderson Suit Says
OPTION CARE: Cruz Wage-and-Hour Suit Removed to N.D. California
PASSAVANT MEMORIAL: Jordan Sues Over Unpaid Overtime for ICDCs
PILGRIM'S PRIDE: Hogan's Second Amended Securities Suit Dismissed
REDDIT INC: Faces Suit Over Failure to Ban Child Pornography
RUSHMORE LOAN: Raams Sues Over Kickbacks from Insurance Policies
SPEEDWAY LLC: Sends Unwanted Telemarketing Texts, Halawani Alleges
SPICY PIZZA: Munoz Sues Over Unpaid OT and Spread-of-Hours Premiums
SYMPHONY JACKSON: Denial of Arbitration Bid in Herns Suit Reversed
TOYOTA MOTORS: Claims in Amended RAV4 Hybrid Fuel Tank Suit Trimmed
VENATOR MATERIALS: Retirement Systems Appeal N.Y. Sup. Ct. Order
*********
1INMM LLC: Misapplied Investor Funds, Whitmore Suit Says
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BLAKE MICHAEL WHITMORE, DANIEL RAPHAEL, MICHAEL DOMINGUEZ, and TOM
LOCHTEFELD, on behalf of themselves and all others similarly
situated v. ZACHARY HORWITZ, 1INMM CAPITAL, LLC, and CITY NATIONAL
BANK, Case No. 2:21-cv-03393 (C.D. Cal., April 20, 2021) is a class
action arising from the Defendants' fraudulent conduct.
According to the complaint, 1inMM, LLC, by and through its owner
and operator, Zachary Horwitz, marketed and sold promissory notes
as high-yield investments backed by purported content distribution
contracts with Netflix and HBO. Unbeknownst to investors, those
contracts never existed. 1inMM had no revenue, and no expectation
of ever receiving revenue, at any time. Horwitz paid investor
returns using new investor money, raising more than $690 million
before his Ponzi scheme collapsed, notes the complaint.
Instead of acquiring and licensing movie rights, Horwitz diverted
and misapplied investor funds, the complaint adds.
The "movements of funds [were] consistent with a Ponzi scheme," the
Federal Bureau of Investigation concluded, as "incoming investor
money was used to repay investors for previous investments. In some
instances, the investors were repaid with their own money. In
addition, funds were sent to the HORWITZ personal account," notes
the complaint. The FBI thus found that the frequent transfers that
kept 1inMM afloat reflected "a Ponzi scheme rather than legitimate
business along the lines of what HORWITZ described to his
investors." The unlawful nature of Horwitz's enterprise was
revealed on April 5, 2021, when the SEC filed a criminal complaint
based on Horwitz's wrongful conduct. Horwitz now owes investors
more than $230,000,000, the complaint relates.
Plaintiff Blake Michael Whitmore invested $200,000 in promissory
notes issued by 1inMM through SAC Advisory, LLC.
Plaintiff Daniel Raphael invested $100,000 in the 1inMM scheme by
purchasing a $100,000 promissory note.
Plaintiff Tom Lochtefeld invested $150,000 in the 1inMM scheme by
purchasing $150,000 worth of promissory notes.
Plaintiff Michael Dominguez invested $100,000 in promissory notes
issued by 1inMM through SAC Advisory, LLC.
Zachary Horwitz is a citizen of Los Angeles, California. Horwitz,
an actor, founded 1inMM Capital, LLC in 2013 as a film distribution
company.
1inMM Capital, LLC is a California limited liability company
headquartered in Los Angeles.
City National Bank is a federally chartered bank with its principal
place of business in Los Angeles. City National is a subsidiary of
the Royal Bank of Canada, a foreign entity headquartered in
Montreal, Quebec. [BN]
The Plaintiff is represented by:
Adam E. Polk, Esq.
Jordan Elias, Esq.
Kai W. Lucid, Esq.
GIRARD SHARP LLP
601 California Street, Suite 1400
San Francisco, CA 94108
Telephone: (415) 981-4800
E-mail: apolk@girardsharp.com
jelias@girardsharp.com
klucid@girardsharp.com
- and -
Jason Kellogg, Esq.
Victoria J. Wilson, Esq.
201 South Biscayne Boulevard
22nd Floor, Miami Center
Miami, FL 33131
Telephone: 305.403.8788
E-mail: jk@lklsg.com
vjw@lklsg.com
AMAZON.COM SERVICES: Thomas Sues Over Unpaid OT for Delivery Staff
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ANDREA THOMAS, DEANDRE TINSON, and SHONNIKA SPEARS, individually
and on behalf of all others similarly situated, Plaintiffs v.
AMAZON.COM SERVICES, INC., AMAZON LOGISTICS, INC., and AMAZON.COM
LLC, Defendants, Case No. 3:21-cv-00442 (M.D. Fla., April 22, 2021)
is a class action against the Defendants for violations of the Fair
Labor Standards Act by failing to compensate the Plaintiffs and
Class members overtime pay for all hours worked in excess of 40
hours in a workweek.
Plaintiffs Thomas, Tinson, and Spears worked for the Defendants as
delivery associates from approximately June 2018 to January 2019,
from approximately September 2018 to March 2019, and from
approximately February 2018 through April 2019, respectively.
Amazon.com Services, Inc. is an e-commerce services provider, with
principal offices in Seattle, Washington.
Amazon Logistics, Inc. is a provider of delivery services, with
principal offices in Seattle, Washington.
Amazon.com LLC is an e-commerce services provider, with principal
offices in Seattle, Washington. [BN]
The Plaintiffs are represented by:
Janet Varnell, Esq.
Brian W. Warwick, Esq.
VARNELL & WARWICK P.A.
P.O. Box 1870
Lady Lake, FL 32158
Telephone: (352) 753-8600
Facsimile: (352) 504-3301
E-mail: jvarnell@varnellandwarwick.com
- and -
Sarah R. Schalman-Bergen, Esq.
Krysten Connon, Esq.
LICHTEN & LISS-RIORDAN, P.C.
729 Boylston Street, Suite 2000
Boston, MA 02116
Telephone: (617) 994-5800
Facsimile: (617) 994-5801
E-mail: ssb@llrlaw.com
kconnon@llrlaw.com
- and -
Ryan Allen Hancock, Esq.
WILLIG, WILLIAMS & DAVIDSON
1845 Walnut Street, 24th Floor
Philadelphia, PA 19103
Telephone: (215) 656-3600
Facsimile: (215) 567-2310
E-mail: rhancock@wwdlaw.com
- and -
Michaela L. Wallin, Esq.
BERGER MONTAGUE PC
1818 Market Street, Suite 3600
Philadelphia, PA 19103
Telephone: (215) 875-3000
Facsimile: (215) 875-4620
E-mail: mwallin@bm.net
APPLE INC: Price Sues Over Unfair Apple ID Termination Provision
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MATTHEW PRICE, individually and on behalf of all others similarly
situated v. APPLE, INC., a California corporation, Case No.
5:21-cv-02846 (N.D. Cal., April 20, 2021) seeks to recover money
paid to and through Apple for Apps, music, movies, TV shows, books,
services and/or other content they purchased but were prohibited
from accessing when Apple unlawfully terminated their Apple IDs in
violation of California's Unfair Competition Law (UCL).
The complaint alleges that Apple violated the "unfair" prong of the
UCL by requiring Plaintiff and the Class Members to enter into
contracts of adhesion which include the Apple ID termination
provision. Specifically, despite knowing and publicly acknowledging
that its customers' accounts are "valuable," Apple included an
unlawful, unconscionable clause in its Apple Media Services Terms
and Conditions which permits Apple to, unilaterally, without
adequate notice, discernable process or explanation, permanently
terminate its customers' Apple IDs and preclude access to the
services and Content its customers have already purchased, it
relates.
In the event of a suspected breach, Apple permanently terminates
its offending customers' Apple IDs, thus depriving them of all the
Content they purchased through Apple. For those Apple customers who
have purchased Apple devices, such as iPhones, iPads, Macs, Apple
Watches, and/or Apple TVs, those devices have been substantially
diminished in value because they cannot be used to access the
services and Content they purchased through Apple. To make matters
worse, when Apple terminates customers' Apple IDs, Apple also
prevents these customers from accessing unused funds they may have
stored in their Apple Accounts, adds the complaint.
Plaintiff, Matthew Price, is an adult citizen and resident of
Pennsylvania, residing in Cambria County, Pennsylvania. On October
29, 2020, Apple determined that Mr. Price breached its Terms and
Conditions and, without notice, explanation, policy or process,
terminated Mr. Price's Apple ID.
Apple is a California corporation with its headquarters and
principal place of business in Cupertino, California, which lies
within this District. Apple is a citizen of California. In addition
to being headquartered and having its principal place of business
in Cupertino, California, Apple transacts substantial business
throughout the State of California, through advertising, marketing,
and ownership of numerous Apple retail stores throughout
California, including several in this District. [BN]
The Plaintiff is represented by:
Jonathan Shub, Esq.
Kevin Laukaitis, Esq.
SHUB LAW FIRM LLC
134 Kings Hwy. E., 2nd Floor
Haddonfield, NJ 08033
Tel: (856) 772-7200
Fax: (856) 210-9088
E-mail: jshub@shublawyers.com
klaukaitis@shublawyers.com
- and -
Troy M. Frederick, Esq.
Beth A. Frederick, Esq.
FREDERICK LAW GROUP, PLLC
836 Philadelphia Street
Indiana, PA 15701
Tel: (724) 801-8555
Fax: (724) 801-8358
E-mail: tmf@FrederickLG.com
baf@FrederickLG.com
- and -
Keith T. Vernon, Esq.
Andrew Knox, Esq.
TIMONEY KNOX, LLP
400 Maryland Ave, PO Box 7544
Fort Washington, PA 19034-7544
Tel: (215) 646-6000
Fax: (215) 591-8258
E-mail: kvernon@timoneyknox.com
aknox@timoneyknox.com
ARON SECURITY: Sattyakam Sues Over Unpaid Wages for Security Guards
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NUR SATTYAKAM and ANTHONY CORSETTI, individually and on behalf of
all others similarly situated, Plaintiffs v. ARON SECURITY, INC.
d/b/a ARROW SECURITY, and JOHN DOE CORPORATIONS 1-100 d/b/a ARROW
SECURITY, Defendants, Case No. 1:21-cv-03485 (S.D.N.Y., April 20,
2021) is a class action against the Defendants for unpaid wages due
to time-shaving and uncompensated travel-time and unpaid overtime
premium in violation of the Fair Labor Standards Act.
Mr. Sattyakam and Mr. Corsetti worked for the Defendants as
security guards from June 2020 through December 31, 2020 and from
January 2017 until August 12, 2020, respectively.
Aron Security, Inc. is a security guard services company with a
principal place of business located at 300 West Main Street,
Smithtown, New York. [BN]
The Plaintiffs are represented by:
C.K. Lee, Esq.
Anne Seelig, Esq.
LEE LITIGATION GROUP, PLLC
148 West 24th Street, 8th Floor
New York, NY 10011
Telephone: (212) 465-1188
Facsimile: (212) 465-1181
BEENVERIFIED LLC: Pittman Sues for Illegal Use of Personal Info
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CLARENCE PITTMAN, individually and on behalf of all others
similarly situated v. BEENVERIFIED, LLC, Case No. 1:21-cv-03476
(S.D.N.Y., April 20, 2021) arises from the Defendant's business
practice of acquiring identifying information about Ohio residents
with the specific intent of selling that information to its
customers in violation of the Ohio Revised Code.
According to the complaint, Defendant owns and operates a website
that sells background reports on people to the general public.
Defendant sells its reports on its website: www.beenverified.com.
Upon accessing BeenVerified's website, the public-at-large is free
to enter the first and last name of a particular individual via a
search bar on the homepage. The search results provide a limited,
free preview of Defendant's reports. The purpose behind
BeenVerified's free preview is singular: to entice users to
purchase Defendant's services. The complaint adds that BeenVerified
knowingly searches and obtains private and public records and/or
identifying information on Ohio residents.
Plaintiff Clarence Pittman is a citizen of Ohio who resides in
Mount Orab, Ohio. Plaintiff discovered that BeenVerified uses his
name, age, city of domicile, and the identity of his relatives in
advertisements on the BeenVerified website to advertise and/or
actually sell Defendant's products and services. However, the
Plaintiff never provided BeenVerified with consent to use any
attribute of his identity in any advertisement or for any
commercial purposes. Moreover, the Plaintiff is not and has never
been a BeenVerified customer. He has no relationship with
BeenVerified whatsoever, asserts the complaint.
BeenVerified, LLC is a Delaware limited liability company
corporation with its principal place of business located in New
York, New York. [BN]
The Plaintiff is represented by:
Philip L. Fraietta, Esq.
888 Seventh Avenue
New York, NY 10019
Tel: (646) 837-7150
Fax: (212) 989-9163
E-Mail: pfraietta@bursor.com
BIBOX GROUP: Court Grants Bid to Dismiss Amended Securities Suit
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In the case, IN RE BIBOX GROUP HOLDINGS LIMITED SECURITIES
LITIGATION, Case No. 20cv2807 (DLC) (S.D.N.Y.), Judge Denise Cote
of the U.S. District Court for the Southern District of New York
granted Bibox's motion to dismiss the Plaintiff's amended
complaint.
Alexander Clifford brings the putative class action against
defendants Bibox Group Holdings Limited, Bibox Technology Ltd.,
Bibox Technology Ou, Wanlin "Aries" Wang, Ji "Kevin" Ma, and
Jeffrey Lei (collectively, "Bibox"), alleging that Bibox violated a
number of provisions of federal securities law and state Blue Sky
laws in its issuance of crypto-assets and its operation of an
exchange for trading in crypto-assets.
Crypto-assets, which are also called "cryptocurrency" or "tokens",
are decentralized digital commodities that rely on a technology
called the "blockchain." A blockchain is a decentralized
electronic ledger that allows for secure and reliable tracking of
the ownership and transfer of each individual unit of the
crypto-asset. The blockchain mechanism allows for the use of
crypto-assets as secure stores of value and media of exchange that
do not rely on centralized government or private control.
Although crypto-assets originated as a medium of exchange, the
continued development of blockchain technology has allowed for
several other uses for crypto-assets. One such use for blockchain
technology is the so-called "smart contract," which essentially
functions as an automated, secure digital escrow account. A smart
contract allows the parties to define the terms of their contract
and submit the crypto-assets contemplated in the contract to a
secure destination. But unlike conventional securities, they do
not give the holder an ownership stake in, or a share of the
revenue of, an underlying corporate entity.
On April 3, 2020, the Plaintiff initiated the action. In his
complaint, the Plaintiff principally alleges that the six tokens at
issue in the litigation qualify as securities under federal and
state securities laws, and that Bibox violated federal and state
law by selling the tokens without registering as an exchange or
broker-dealer and without a registration statement in effect for
the six tokens at issue.
The Plaintiff seeks certification of multiple subclasses: Some seek
to recover on behalf of all investors who purchased the six tokens
on the Bibox exchange in the United States, some seek to recover on
behalf of all persons who purchased BIX in the United States
directly from the Defendants, and some seek to recover on behalf of
all persons who purchased BIX in the United States from a third
party.
On June 8, 2020, the Plaintiff was appointed the Lead Plaintiff.
On July 31, the Plaintiff moved pursuant to Rule 4, Fed. R. Civ.
P., to serve by alternative means the defendants other than Bibox
Group Holdings, Ltd, claiming that prior efforts to serve the
remaining defendants had been unsuccessful. On August 10, the
Court granted the Plaintiff's motion to serve the remaining
Defendants via their social media accounts, via corporate and
personal email, and via the registered agent of Bibox Group
Holdings, Ltd. On August 28, the the Plaintiff notified the Court
that alternative service had been completed and filed an amended
complaint.
Counsel for Bibox appeared on October 15, and Bibox moved to
dismiss on December 9. The motion to dismiss became fully
submitted on Feb. 12, 2021.
The complaint asserts 154 causes of action. Six of these claims
arise under federal law. The complaint asserts that Bibox violated
Section 5 and 12(a)(1) of the Securities Act by offering for sale
securities, namely the six tokens for which registration statements
had not been filed with the SEC. It further alleges that Bibox
violated Sections 5 and 29(b) of the Exchange Act by entering into
contracts to buy and sell securities, namely the six tokens, on an
unregistered exchange.
The Plaintiff further asserts that Bibox violated Sections
15(a)(1) and 29(b) of the Exchange Act by operating as an
unregistered broker and dealer in connection with the six tokens,
and that the individual Bibox defendants are subject to control
person liability under Section 20 of the Exchange Act for causing
the sale of the six tokens on an unregistered exchange. The final
federal claims allege that Bibox violated Sections 5 and 12(a)(2)
of the Securities Act by selling BIX, a security, with false
statements and omissions of material facts in its prospectus, and
that the individual Bibox Defendants are subject to control person
liability for this violation pursuant to Sections 5, 12(a)(1), and
12(a)(2) of the Securities Act.
The remaining 148 claims are brought under the Blue Sky laws of all
50 states and the District of Columbia. The sole named Plaintiff
in the action resides in Illinois. The parties' submissions on
Bibox's motion to dismiss address solely the viability of the
Illinois Blue Sky claims and do not address the other Blue Sky
claims alleged in the complaint. Where, as in the case, a named
class action Plaintiff brings state law claims that may not be
brought by the named Plaintiff, but may be brought by putative
class members, courts typically address only the state law claims
of the named plaintiff at the motion to dismiss stage and do not
address the standing and merits arguments with respect to the
additional state law claims unless and until the motion to dismiss
is denied and a motion for class certification is granted pursuant
to Rule 23, Fed. R. Civ. P.
Bibox has moved to dismiss on several jurisdictional and merits
grounds.
I. Standing
The Plaintiff brings claims related to the sale of six tokens but
alleges that he purchased only the BIX token. The Defendants argue
that the Plaintiff lacks standing to pursue claims for a class
arising from the five tokens described in the complaint that he did
not purchase.
Judge Cote holds that the Defendants are correct. She finds that
the Plaintiff has not alleged that he suffered any actual injury
from the conduct of the Defendants regarding the five tokens he did
not purchase. Moreover, he has not sufficiently alleged that any
injury to class members from the Defendants' conduct regarding
these five tokens implicates the same set of concerns as the injury
he has alleged that he suffered from the purchase and sale of a BIX
token. Therefore, the Plaintiff lacks standing to bring suit
regarding tokens that he did not purchase, and his claims arising
from the existence of those tokens must be dismissed.
II. Statute of Limitations
The Defendants have moved to dismiss the remaining claims, each of
which arises from the Plaintiff's purchase of BIX, on the ground
that the claims are barred by the statute of limitations. The
Plaintiff's final purchase of BIX occurred on Oct. 27, 2018, and
his final sale of BIX occurred on Dec. 11, 2018. The Plaintiff
filed the action on April 3, 2020, roughly 16 months after that
final transaction. The Defendants argue that the Plaintiff's
claims must be filed within at most one year of their accrual and
therefore fall outside of the relevant limitations period.
First, Judge Cote opines that the Plaintiff's argument for the
application of a discovery rule to his Section 12(a)(1) claim
fails. The statutory text does not authorize a discovery rule, and
the Supreme Court has held that an "atextual judicial
supplementation" of statutory text with a discovery rule is
"particularly inappropriate" because "Congress has shown that it
knows how to adopt" a discovery rule when it chooses to do so.
Moreover, even if the Plaintiff could invoke a discovery rule, it
would not assist him. The Plaintiff claims that he did not learn
of his potential legal rights under Section 12(a)(1) until the SEC
released the Framework on April 3, 2019. Ignorance of legal rights
does not delay the accrual of a claim under a discovery rule. In
any event, the Framework is merely a non-binding agency
interpretation of the longstanding Howey test and did not create
new rights.
Next, Judge Cote opines that the plaintiff's claims under Sections
12(a)(2) and 29(b) are also barred by the statute of limitations.
Even the application of a discovery rule does not extend the
one-year bar. The Plaintiff did not learn of any "critical facts"
regarding his injury when the SEC issued the Framework on April 3,
2019, but rather learned only of the SEC's nonbinding
interpretation of S.E.C. v. W.J. Howey Co., 328 U.S. 293, 298-99
(1946). While that interpretation may assist the Plaintiff in
crafting a legal argument that BIX is indeed a security and subject
to regulation under federal securities law, that guidance did not
extend the statute of limitations period for his claims.
Moreover, equitable tolling is also inappropriate because the
Plaintiff does not allege that Bibox concealed any material facts
regarding BIX; he simply alleges that Bibox did not disclose BIX
was a security under the relevant legal standard. Bibox's failure
to adopt the Plaintiff's preferred legal conclusion in its
materials does not amount to a concealment of material fact.
Lastly, the Judge opines that the Plaintiff provides almost no
detail as to when he, in fact, learned that the sale was voidable,
alleging only that he "learned that the sale was voidable under
Illinois law within six months prior to the filing of the original
Complaint." The complaint, therefore, amounts to an attempt to
satisfy the notice element of the Illinois Blue Sky civil remedy
provision with a "threadbare recital of the elements of the cause
of action, supported by mere conclusory statements." These
allegations "do not suffice" to survive Bibox's motion to dismiss.
Conclusion
Judge Cote granted Bibox's Dec. 9, 2020 motion to dismiss. The
Clerk of Court is directed to enter judgment for the Defendants and
close the case.
A full-text copy of the Court's April 16, 2021 Opinion & Order is
available at https://tinyurl.com/p2rnfb7b from Leagle.com.
Kyle William Roche -- kyle@rcfllp.com -- Edward John Normand --
tnormand@rcfllp.com -- Velvel (Devin) Freedman -- vel@rcfllp.com --
Alex Potter -- apotter@rcfllp.com -- Roche Cyrulnik Freedman LLP,
in New York City.
Phillipe Selendy -- pselendy@selendygay.com -- Jordan Goldstein --
jgoldstein@selendygay.com -- Spencer Gottlieb --
sgottlieb@selendygay.com -- Michelle Foxman --
mfoxman@selendygay.com -- Selendy & Gay PLLC, in New York City, For
lead plaintiff Alexander Clifford.
Sigmund S. Wissner-Gross -- swissner-gross@brownrudnick.com --
Ashley L. Baynham -- abaynham@brownrudnick.com -- Brown Rudnick
LLP, Seven Times Square, in New York City, for Defendants.
CONSUMER CELLULAR: Geary Sues Over Unpaid OT for Call Center Agents
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DIANA GEARY, individually and on behalf of all others similarly
situated, Plaintiff v. CONSUMER CELLULAR, INC., Defendant, Case No.
2:21-cv-00699-DLR (D. Ariz., April 22, 2021) is a class action
against the Defendant for violations of the Fair Labor Standards
Act and the Arizona Wage Act by failing to compensate the Plaintiff
and all others similarly situated call center employees overtime
pay for all hours worked in excess of 40 hours in a workweek.
The Plaintiff worked for the Defendant as a Customer Associate
Advisor 1 from February 2018 to April 2018.
Consumer Cellular, Inc., is a company that operates customer
service call center locations in North Phoenix and Tempe, Arizona.
[BN]
The Plaintiff is represented by:
Richard P. Traulsen, Esq.
BEGAM MARKS & TRAULSEN, PA
11201 North Tatum Blvd., Suite 110
Phoenix, AZ 85028-6037
Telephone: (602) 254-6071
E-mail: rtraulsen@BMT-law.com
- and –
Jacob R. Rusch, Esq.
Timothy J. Becker, Esq.
Zackary S. Kaylor, Esq.
JOHNSON BECKER, PLLC
444 Cedar Street, Suite 1800
Saint Paul, MN 55101
E-mail: jrusch@johnsonbecker.com
tbecker@johnsonbecker.com
zkaylor@johnsonbecker.com
EBANG INTERNATIONAL: Faces Zeva Suit Over Misleading Statements
---------------------------------------------------------------
KONSTANTIN ZEVA, Individually and On Behalf of All Others Similarly
Situated v. EBANG INTERNATIONAL HOLDINGS INC., DONG HU, and LEI
CHEN, Case No. 1:21-cv-09859 (D.N.J., April 20, 2021) is a class
action on behalf of persons and entities that purchased or
otherwise acquired Ebang securities between June 26, 2020 and April
5, 2021, inclusive (Class Period).
The complaint alleges that throughout the Class Period, Defendants
made materially false and/or misleading statements, as well as
failed to disclose material adverse facts about the Company's
business, operations, and prospects. Specifically, Defendants
failed to disclose to investors: (1) that the proceeds from Ebang's
public offerings had been directed to low yield, long term bonds to
an underwriter and to related parties rather than used to develop
the Company's operations; (2) that Ebang's sales were declining and
the Company had inflated reported sales, including through the sale
of defective units; (3) that Ebang's attempts to go public in Hong
Kong had failed due to allegations of embezzling investor funds and
inflated sales figures; (4) that Ebang's purported cryptocurrency
exchange was merely the purchase of an out-of-the-box crypto
exchange; and (5) that, as a result of the foregoing, Defendants'
positive statements about the Company's business, operations, and
prospects were materially misleading and/or lacked a reasonable
basis.
Plaintiff Zeva purchased Ebang shares during the Class Period, and
suffered damages as a result of the federal securities law
violations and false and/or misleading statements and/or material
omissions alleged in the suit.
Ebang is incorporated under the laws of the Cayman Islands with its
principal executive offices located in China. Ebang's Class A
ordinary shares trade on the NASDAQ exchange under the symbol
"EBON."
Dong Hu was the Company's Chief Executive Officer at all relevant
times.
Lei Chen was the Company's Chief Financial Officer at all relevant
times. [BN]
The Plaintiff is represented by:
Thomas H. Przybylowski, Esq.
Jeremy A. Lieberman, Esq.
J. Alexander Hood II, Esq.
600 Third Avenue, 20th Floor
New York, NY 10016
Telephone: (212) 661-1100
Facsimile: (917) 463-1044
E-mail: tprzybylowski@pomlaw.com
jalieberman@pomlaw.com
ahood@pomlaw.com
ELANCO ANIMAL: Seresto Collars Harmful to Pets, Revolinsky Alleges
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LAURA REVOLINSKY, on behalf of herself and all others similarly
situated, Plaintiff v. ELANCO ANIMAL HEALTH INCORPORATED and BAYER
HEALTHCARE LLC, Defendants, Case No. 3:21-cv-10003 (D.N.J., April
22, 2021) is a class action against the Defendants for breach of
express warranty, breach of implied warranty, injunctive and
equitable relief, unjust enrichment, common law fraud, and
violations of the Magnuson-Moss Act, the New Jersey Consumer Fraud
Act, and the Truth-in-Consumer Contract, Warranty and Notice Act.
The case arises from the Defendants' failure to disclose to
consumers, including the Plaintiff, about the safety risks posed by
the Seresto brand flea and tick collars to dogs and cats. The
Seresto products purport to prevent fleas and ticks on dogs and
cats by releasing small amounts of pesticides onto the pets over
time. However, the harm inflicted by Seresto Collars far outweighs
any benefits of flea or tick prevention that the products might
offer. As a result of the Defendants' active concealment of the
hazards associated with use of the Seresto Collars, the Plaintiff
and Class members did not receive the benefit of their bargain and
suffered damages, the suit alleges.
Elanco Animal Health, Inc. is an American pharmaceutical company
which produces medicines and vaccinations for pets and livestock,
headquartered in Greenfield, Indiana.
Bayer Healthcare LLC is a manufacturer of healthcare and medical
products based in Whippany, New Jersey. [BN]
The Plaintiff is represented by:
Joseph LoPiccolo, Esq.
John N. Poulos, Esq.
Anthony S. Almeida, Esq.
POULOS LOPICCOLO PC
1305 South Roller Road
Ocean, NJ 07712
Telephone: (732) 757-0165
E-mail: lopiccolo@pllawfirm.com
poulos@pllawfirm.com
almeida@pllawfirm.com
- and –
Bruce H. Nagel, Esq.
Randee Matloff, Esq.
NAGEL RICE, LLP
103 Eisenhower Parkway
Roseland, NJ 07068
Telephone: (973) 618-0400
E-mail: rmatloff@nagelrice.com
bnagel@nagelrice.com
GENERAL MOTORS: Torres Sues Over Chevy Bolt's Battery Defect
------------------------------------------------------------
ANDRES TORRES, individually and on behalf of all others similarly
situated v. GENERAL MOTORS LLC, Case No. 2:21-cv-10888-VAR-KGA
(N.D. Ill., April 20, 2021) seeks economic damages due to the
Defendant's deceptive marketing of defective Chevrolet Bolt EVs or
Class Vehicles.
The lawsuit alleges that GM failed to inform prospective owners and
lessees of the Chevy Bolt that the vehicle is plagued with a
dangerous battery defect and that owners and lessees of the Class
Vehicles will be forced to decide between a risk of a potentially
fatal car fire or a significant power loss. Defendant GM further
failed to inform consumers that the battery capacity is less than
advertised, or that the vehicles would require a "fix" that reduces
their driving range by 10%. GM's conduct has placed Bolt purchasers
into an untenable position: either continue to drive and use a
vehicle that poses a risk of catching fire or acquiesce to GM's
recommended "fix" to reduce the battery's capacity.
Plaintiff Andres Torres is an adult individual who resides in
Bolingbrook, Illinois. In August 2019, Plaintiff purchased a 2017
Chevy Bolt from a dealership in Downers Grove, Illinois, an
authorized GM retailer.
General Motors LLC is a limited liability company organized under
Delaware law with its principal office located at 300 Renaissance
Center, Detroit, Michigan 48265. GM designs, tests, markets,
manufactures, distributes, warrants, sells, and leases various
vehicles under several prominent brand names, including but not
limited to Chevrolet, Buick, GMC, and Cadillac in this district and
throughout the United States. [BN]
The Plaintiff is represented by:
Ben Barnow, Esq.
Erich P. Schork, Esq.
Anthony Parkhill, Esq.
BARNOW AND ASSOCIATES, P.C.
205 West Randolph Street, Suite 1630
Chicago, IL 60606
Telephone: (312) 621-2000
E-mail: b.barnow@barnowlaw.com
e.schork@barnowlaw.com
aparkhill@barnowlaw.com
- and -
Benjamin F. Johns, Esq.
Beena M. McDonald, Esq.
Samantha E. Holbrook, Esq.
CHIMICLES SCHWARTZ KRINER & DONALDSON-SMITH LLP
361 West Lancaster Avenue
Haverford, PA 19041
Telephone: (610) 642-8500
Facsimile: (610) 649-3633
E-mail: bfj@chimicles.com
bmm@chimicles.com
seh@chimicles.com
- and -
Steven D. Cohen, Esq.
Susan J. Russell, Esq.
J. Burkett McInturff, Esq.
WITTELS MCINTURFF PALIKOVIC
18 Half Mile Road
Armonk, NY 10504
Telephone: (914) 319-9945
Facsimile: (914) 273-2563
E-mail: sdc@wittelslaw.com
sjr@wittelslaw.com
jbm@wittelslaw.com
HANKEY INVESTMENT: Castellanos Sues Over Wage-and-Hour Violations
-----------------------------------------------------------------
MICHAEL CASTELLANOS, individually and on behalf of all others
similarly situated, Plaintiff v. HANKEY INVESTMENT COMPANY, LP,
NOWCOM, LLC, MIDWAY RENT A CAR, INC., KNIGHT MANAGEMENT COMPANY,
INC., HFC ACCEPTANCE, LLC, DON HANKEY, and DOES 1 through 100,
inclusive, Defendants, Case No. 21STCV15377 (Cal. Super., Los
Angeles Cty., April 22, 2021) is a class action against the
Defendants for violations of the California Labor Code and the
California Business and Professions Code including failure to pay
overtime and double time, failure to provide rest and meal periods,
failure to pay minimum wage, failure to keep accurate payroll
records and provide itemized wage statements, failure to pay all
wages earned on time, failure to pay all wages earned upon
discharge or resignation, failure to provide basic information at
the time of hiring and when employment changes occur, failure to
reimburse business-related expenses, and failure to provide notice
of paid sick time and accrual.
The Plaintiff worked for the Defendants as senior corporate
recruiter from August 2019 until September 8, 2020.
Hankey Investment Company, LP is a real estate investment,
development and finance firm in California.
Nowcom, LLC is a provider in turn-key design, engineering, and
construction services, headquartered in Dothan, Alabama.
Midway Rent A Car, Inc. is a car rental company in Los Angeles,
California.
Knight Management Company, Inc. is a commercial real estate
management firm in California.
HFC Acceptance, LLC is a provider of fleet financing for rental car
operators based in Los Angeles, California. [BN]
The Plaintiff is represented by:
Haig B. Kazandjian, Esq.
Cathy Gonzalez, Esq.
Kevin Crough, Esq.
HAIG B. KAZANDJIAN LAWYERS, APC
801 North Brand Boulevard, Suite 970
Glendale, CA 91203
Telephone: (818) 696-2306
Facsimile: (818) 696-2307
E-mail: haig@hbklawyers.com
cathy@hbklawyers.com
kevin@hbklawyers.com
JOINT CORP: Vlad Sues Over Unsolicited Robocalls and Text Messages
------------------------------------------------------------------
ANA MARIA VLAD, individually and on behalf of all others similarly
situated, Plaintiff v. THE JOINT CORP. D/B/A THE JOINT CHIROPRACTIC
MANAGEMENT COMPANY, Defendant, Case No. 8:21-cv-00767 (C.D. Cal.,
April 22, 2021) is a class action against the Defendant for
violations of the Telephone Consumer Protection Act.
According to the complaint, the Defendant transmitted calls and
text messages to the cellular telephones of the Plaintiff and Class
members using an automated telephone dialing system to promote its
chiropractic services without their prior express consent.
The Joint Corp., doing business as The Joint Chiropractic
Management Company, is a chiropractic services provider, with its
principal place of business located at 16767 N. Perimeter Dr.,
Suite 110, Scottsdale, Arizona. [BN]
The Plaintiff is represented by:
Abbas Kazerounian, Esq.
Pamela E. Prescott, Esq.
KAZEROUNI LAW GROUP, APC
245 Fischer Avenue, Unit D1
Costa Mesa, CA 92626
Telephone: (800) 400-6808
Facsimile: (800) 520-5523
E-mail: ak@kazlg.com
pamela@kazlg.com
- and –
Jason A. Ibey, Esq.
KAZEROUNI LAW GROUP, APC
321 N Mall Drive, Suite R108
St. George, Utah 84790
Telephone: (800) 400-6808
Facsimile: (800) 520-5523
E-mail: jason@kazlg.com
KAISER FOUNDATION: Faces Stewart Suit Over Race Discrimination
--------------------------------------------------------------
SHELBY STEWART, CHARLETA DABROWSKI, BENEDICT JOHNSON, and KENYA
MAYFIELD, on behalf of themselves and all others similarly
situated, Plaintiffs v. KAISER FOUNDATION HEALTH PLAN, INC., KAISER
FOUNDATION HOSPITALS, THE PERMANENTE MEDICAL GROUP, INC., and
SOUTHERN CALIFORNIA PERMANENTE MEDICAL GROUP, Defendants, Case No.
CGC-21-590966 (Cal. Super., San Francisco Cty., April 22, 2021) is
a class action against the Defendants for race discrimination,
unequal pay, failure to prevent discrimination, and unfair
competition in violation of the California Fair Employment and
Housing Act, the California Labor Code, and the California Business
and Professions Code.
The Plaintiffs and Class members seek declaratory and injunctive
relief to put a halt on the Defendants' practice of discriminating
against Black employees with respect to compensation, promotions,
and performance evaluations.
Ms. Stewart worked for the Defendants as senior manager from 2006
until September 4, 2020.
Ms. Dabrowski and Mr. Johnson has been employed by the Defendants
as operations specialist II since 2006 and 2007, respectively.
Ms. Mayfield was employed by the Defendants as a contract manager I
from June 1989 until August 1, 2020.
Kaiser Foundation Health Plan, Inc. is a non-profit health care
organization, headquartered in Oakland, California.
Kaiser Foundation Hospitals is a health care services company,
headquartered in Oakland, California.
The Permanente Medical Group, Inc. is a health care services
company, headquartered in Oakland, California.
Southern California Permanente Medical Group is a health care
services company, headquartered in Pasadena, California. [BN]
The Plaintiffs are represented by:
Felicia Medina, Esq.
Jennifer Orthwein, Esq.
Kevin Love Hubbard, Esq.
Shauna Madison, Esq.
MEDINA ORTHWEIN LLP
230 Grand Avenue, Suite 201
Oakland, CA 94610
Telephone: (510) 823-2040
Facsimile: (510) 217-3580
E-mail: fmedina@medinaorthwein.com
jorthwein@medinaorthwein.com
khubbard@medinaorthwein.com
smadison@medinaorthwein.com
- and –
Kelly M. Dermody, Esq.
Jalle Dafa, Esq.
LIEFF CABRASER HEIMANN & BERNSTEIN, LLP
275 Battery Street, 29th Floor
San Francisco, CA 94111
Telephone: (415) 956-1000
Facsimile: (415) 956-1008
E-mail: kdermody@lchb.com
jdafa@lchb.com
MCDERMOTT INT'L: S.D. Texas Denies Bid to Dismiss Edwards Suit
--------------------------------------------------------------
In the case, MIRIAM EDWARDS, et al., Plaintiffs v. McDERMOTT
INTERNATIONAL, INC., et al., Defendants, Civil Action No.
4:18-CV-4330 (S.D. Tex.), Judge George C. Hanks, Jr., of the U.S.
District Court for the Southern District of Texas, Houston
Division, denied the Defendants' motion to dismiss under Federal
Rule of Civil Procedure 12(b)(6).
Plaintiff Public Employees' Retirement System of Mississippi
("Mississippi") is the Lead Plaintiff in the securities class
action brought on behalf of shareholders of record of Defendant
McDermott as of April 4, 2018 who had the right to vote in
connection with the proposed merger between McDermott and Chicago
Bridge & Iron Co., N.V. ("CB&I"). The Defendants are: (1)
McDermott; (2) CB&I; (3) McDermott President and CEO David Dickson;
(4) McDermott Executive VP and CFO Stuart Spence); and (5) CB&I
President and CEO Patrick Mullen. The merger bankrupted McDermott
and led to ongoing SEC and federal grand jury investigations.
McDermott provides technology, engineering, and construction
services to the energy industry. CB&I was an engineering and
construction company that worked in the oil and gas industry and
focused on downstream onshore operations, particularly the
construction of petrochemical plants.
In December of 2017, McDermott entered into a business combination
agreement with CB&I to effectuate a merger between the two
companies. Under the terms of the merger agreement, CB&I would
merge into McDermott and CB&I shareholders would receive 0.82407
shares of McDermott stock for each share of CB&I stock, and
McDermott shareholders would own approximately 53% of the combined
entity.
CB&I's contractual backlog included four large construction
projects in the United States dubbed "the Focus Projects." The
Focus Projects consisted of two gas turbine projects, known as the
Calpine Gas Turbine Power Project and the IPL Project, and two
liquefied natural gas export facility projects, known as the
Freeport LNG Project and the Cameron LNG Project.
Analysts and investors homed in on the Focus Projects and how
McDermott would value them from the moment the merger was
announced: "the very first question from an analyst on the December
18, 2017 joint conference call discussing the newly-announced
Merger dealt with the level of due diligence around the
transaction." Dickson said that McDermott had "worked extensively
with CB&I on due diligence," and Spence stated that the due
diligence on the Focus Projects was "significant." In response to
a question about how McDermott had "priced in the potential risk"
on the Focus Projects, Dickson said that the Focus Projects were
"fairly well-progressed, so that takes out a lot of the risk that
you would expect at the start-up."
Mississippi has pled claims against the Defendants under Section
14(a) of the Securities Exchange Act of 1934 and Rule 14a-9
promulgated thereunder. Mississippi has also pled claims of
control person liability against Dickson, Spence, and Mullen under
Section 20(a) of the Securities Exchange Act of 1934.
Before the Court is a motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6) filed by the Defendants. In their motion to
dismiss, the Defendants argue that Mississippi's Section 14(a)
claims must be dismissed because: (1) Mississippi pleads a
derivative claim, rather than a direct one; (2) Mississippi has
failed to plead loss causation; and (3) the statements relied on by
Mississippi are puffery, non-actionable opinions, or
forward-looking statements that fall within the PSLRA's safe
harbor.
Judge Hanks disagrees with all of the Defendants' contentions.
First, the Judge opines that Mississippi is entitled to bring, and
has pled, a direct claim. Mississippi has pled that it "and other
members of the proposed Class were denied the opportunity to make
an informed decision when voting on the Merger" because the
Defendants made "false and misleading statements of material fact"
that were designed to "encourage the Class to vote in favor of the
Merger."
Next, the Judge opines that Mississippi has sufficiently pled loss
causation. More specifically, he finds that Mississippi has pled
facts sufficient to establish that the merger between McDermott and
CB&I, and the misleading proxy materials that facilitated it, led
to drastic drops in McDermott's stock price as the truth about the
Focus Projects became known. These allegations, he says, are
sufficient to plead loss causation.
Lastly, the Judge opines that Mississippi has sufficiently pled
actionable misrepresentations and omissions. Mississippi has pled
sufficient facts to establish that Defendants' repeated assurances
regarding the Focus Projects were material and made with actual
knowledge that they were misleading.
Internal CB&I forecasts and risk registers showed that, at the time
of the merger, McDermott and CB&I were understating the costs
associated with the Focus Projects by about $1 billion. A project
controls director who worked on both the Calpine and Cameron
projects at CB&I left McDermott shortly after the merger because
the company, like CB&I before the merger, refused to report the
additional costs and was engaging in "a deception to stakeholders
of the company." The Defendants did not disclose the existence of
the estimates, which ultimately proved to be correct. The
Defendants' repeated assurances regarding the Focus Projects
omitted material facts about the costs of the Focus Projects, and
those omissions are actionable.
Under the circumstances, Judge Hanks concludes that Mississippi has
established an entitlement to further discovery in the case.
Accordingly, he denied the Defendants' motion to dismiss.
Discovery in the case may proceed.
A full-text copy of the Court's April 14, 2021 Memorandum Opinion &
Order is available at https://tinyurl.com/evz7zerm from
Leagle.com.
MFK MOBILELINK: Compensation System Unlawful, Moderson Suit Says
----------------------------------------------------------------
MELINDA MODERSON, on behalf of herself and all others similarly
situated v. MFK MOBILELINK WISCONSIN, LLC, Case No. 21-cv-504 (E.D.
Wis., April 20, 2021) seeks to obtain relief under the Fair Labor
Standards Act of 1938 (FLSA) and the Wisconsin's Wage Payment and
Collection Laws (WWPCL) due to the Defendant's deliberate failure
to compensate its hourly-paid, non-exempt employees for hours
worked at the proper and legal rate(s).
The complaint alleges that Defendant operated (and continues to
operate) an unlawful compensation system that deprived Plaintiff
and all other hourly-paid, non-exempt employees of their wages
earned for all compensable work performed each workweek, including
at an overtime rate of pay for each hour worked in excess of 40
hours in a workweek. Specifically, Defendant's unlawful
compensation system failed to include all forms of
non-discretionary compensation such as monetary bonuses,
commissions, incentives, awards, and/or other rewards and payments,
in all current and former hourly-paid, non-exempt employees'
regular rates of pay for overtime calculation purposes, in
violation of the FLSA and WWPCL.
Plaintiff performed compensable work as an hourly-paid, non-exempt
employee in the position of Store Manager and Store Manager II in
the State of Wisconsin.
MFK Mobilelink Wisconsin, LLC is a Cricket Wireless service
provider doing business in the State of Wisconsin with a principal
office address of 12501 Reed Road, Sugar Land, Texas 77478.[BN]
The Plaintiff is represented by:
James A. Walcheske, Esq.
Scott S. Luzi, Esq.
David M. Potteiger, Esq.
WALCHESKE & LUZI, LLC
235 N. Executive Drive, Suite 240
Brookfield, WI 53005
Telephone: (262) 780-1953
Fax: (262) 565-6469
E-Mail: jwalcheske@walcheskeluzi.com
sluzi@walcheskeluzi.com
dpotteiger@walcheskeluzi.com
OPTION CARE: Cruz Wage-and-Hour Suit Removed to N.D. California
---------------------------------------------------------------
The case styled ERIN CRUZ, individually and on behalf of all others
similarly situated v. OPTION CARE ENTERPRISES, INC. and DOES 1
through 20, inclusive, Case No. RG21092727, was removed from the
Superior Court of the State of California for the County of Alameda
to the U.S. District Court for the Northern District of California
on April 22, 2021.
The Clerk of Court for the Northern District of California assigned
Case No. 3:21-cv-02944 to the proceeding.
The case arises from the Defendant's alleged violation of the
California Labor Code for unpaid meal break premium wages and rest
break premium wages and inaccurate wage statements.
Option Care Enterprises, Inc. is a home health care services
company based in Bannockburn, Illinois. [BN]
The Defendant is represented by:
Thomas H. Petrides, Esq.
Ashley D. Stein, Esq.
VEDDER PRICE (CA), LLP
1925 Century Park East, Suite 1900
Los Angeles, CA 90067
Telephone: (424) 204-7700
Facsimile: (424) 204-7702
E-mail: tpetrides@vedderprice.com
astein@vedderprice.com
PASSAVANT MEMORIAL: Jordan Sues Over Unpaid Overtime for ICDCs
--------------------------------------------------------------
RICHARD JORDAN, individually and on behalf of all others similarly
situated, Plaintiff v. PASSAVANT MEMORIAL HOMES, Defendant, Case
No. 2:21-cv-00540-MJH (W.D. Pa., April 22, 2021) is a class action
against the Defendant for violations of the Fair Labor Standards
Act and the Pennsylvania Minimum Wage Act by failing to compensate
the Plaintiff and all others similarly situated employees overtime
pay for all hours worked in excess of 40 hours in a workweek.
The Plaintiff worked for the Defendant as an independent
contractor-direct care (ICDC) from approximately 2015 until late
2020.
Passavant Memorial Homes is a non-profit, human services provider
organization, headquartered at 163 Thorn Hill Road, Warrendale,
Pennsylvania. [BN]
The Plaintiff is represented by:
Peter Winebrake, Esq.
WINEBRAKE & SANTILLO, LLC
715 Twining Road, Suite 211
Dresher, PA 19025
Telephone: (215) 884-2491
E-mail: pwinebrake@winebrakelaw.com
PILGRIM'S PRIDE: Hogan's Second Amended Securities Suit Dismissed
-----------------------------------------------------------------
In the case, PATRICK HOGAN, individually and on behalf of all
others similarly situated, Plaintiff v. PILGRIM'S PRIDE
CORPORATION, WILLIAM W. LOVETTE, FABIO SANDRI, Defendants, Civil
Action No 16-cv-02611-RBJ (D. Colo.), Judge R. Brooke Jackson of
the U.S. District Court for the District of Colorado granted the
Defendants' motion to dismiss the second amended complaint.
The case is a federal securities class action against Pilgrim, a
leading chicken producer; Lovette, Pilgrim's CEO; and Sandri,
Pilgrim's CFO. George Fuller is the Lead Plaintiff in the case and
asserts claims on behalf of not only himself but also all of those
similarly situated, i.e., those who purchased or otherwise acquired
Pilgrim securities between Feb. 21, 2014 and Nov. 17, 2016.
Although the relevant class period is Feb. 21, 2014 through Nov.
17, 2016, the Plaintiff alleges that the actions giving rise to the
lawsuit date back to 2007. In 2007 and 2008 the broiler industry
experienced a particularly low "bust," because rising feed
ingredients resulted in significant market pressure. According to
the Plaintiff, Pilgrim declared bankruptcy in December 2008 as a
result of this dramatic bust. Pilgrim emerged from bankruptcy
following a sale of its majority stake to its parent company, JBS
SA.
The Plaintiff alleges that, in an effort to achieve post-bankruptcy
stability, "Pilgrim coordinated with fellow industry participants
-- together comprising approximately 95% of the market -- to embark
an orchestrated reduction of the broiler supply." The broiler
companies apparently worked together to ensure that each company
adhered to the bargain and did not flood the market with chicken.
To do this, the conspirators used a "unique, highly detailed data
sharing service known as Agri Stats, through which the companies
exchanged comprehensive proprietary data concerning each company's
operations, production, inventory, cost and pricing, compiled in
nearly real time." The companies' tactics for keeping the chicken
supply down included reducing eggs, reducing broiler breeder
flocks, destroying chicks or eggs, temporarily or permanently
shutting down facilities, and exporting eggs and chicks.
The broiler companies allegedly used the Agri Stats data to
coordinate two tranches of significant Broiler production cuts.
The first major one occurred in 2009-2010, and the second in
2011-2012. In February 2014 -- the beginning of the class period
-- broiler prices were expected to increase, and breeder flocks
were reduced. The broiler companies also allegedly manipulated the
Georgia Dock and Urner Barry, the leading wholesale chicken prices
indices. While the rest of the chicken industry dealt with a
drastic drop in prices in 2015 and 2016, there was no corresponding
decline in broiler prices. During the class period, Pilgrim
reported record-breaking financial results, including profit
margins of more than 16 percent, which were nearly three times what
other companies had historically achieved on average. By December
2014 Pilgrim's stock was trading at over $38 per share, when just
six years earlier it had been trading at under $0.15 per share.
Pilgrim explained their increased profit margins based on their
fundamentally transforming their business model and improving
better product mix and operational improvements "to achieve a level
of unprecedented financial success and stability." The Plaintiff
contends that Pilgrim's growth was instead a result of the price
fixing scheme that is the subject of the lawsuit. According to the
Plaintiff, the Defendant company and the individual defendants made
numerous false statements with regard to Pilgrim's success.
Various sources became aware of the alleged price fixing scheme in
the poultry industry. On Sept. 2, 2016 a group of Pilgrim's
wholesale customers and numerous other broiler producers filed a
class action in the Northern District of Illinois, alleging that
Pilgrim and other broiler companies participated in an illegal
anti-competitive scheme in violation of federal antitrust law. In
November 2016 both the New York Times and the Washington Post
published articles discussing the apparent scheme. This alleged
scheme has continued to garner national media attention and has
resulted in numerous federal lawsuits.
The initial complaint in the case was filed on Oct. 20, 2016, and
Patrick Hogan was listed as the Lead Plaintiff on the case. The
initial complaint alleged two causes of action. The first involved
Section 10(b) and Rule 10b-5 violations of the Securities and
Exchange Act. The second involved alleged violations of Section
20(a) of the Exchange Act.
On May 11, 2017, the Plaintiff filed his first amended complaint in
which George Fuller replaced Patrick Hogan as the Lead Plaintiff,
and the same causes of action were alleged. On June 12, 2017, the
Defendants filed a motion to dismiss the first amended class action
complaint. That motion was granted on March 14, 2018 because the
Court found that "the Plaintiff did not plead the underlying
antitrust conspiracy with sufficient particularity." It further
stated that the Plaintiff's securities case was "essentially
premature but not necessarily hopeless." The case was therefore
dismissed without prejudice.
The Plaintiff filed a second amended complaint 576 days following
that dismissal. The second amended complaint listed the same
causes of action as the first two complaints. Specifically, the
second amended complaint alleged Section 10(b) violations of the
Exchange Act and Rule10 b-5, and 10-b5(a) and (c) against all the
Defendants and Section 20(a) violations against defendants Lovette
and Sandri. As in the initial amended complaint, the alleged
misstatements began in fiscal year 2013 and continued through 2016.
In the second amended complaint, plaintiff alleged that additional
facts had come to light that bolstered his claims so that they were
no longer premature.
These additional facts are that on June 3, 2020, "a federal grand
jury in the U.S. District Court in Denver, Colorado, returned an
indictment against four executives for their role in a conspiracy
to fix prices and rig bids for broiler chickens." Two of these
executives were Pilgrim employees. Based on the indictment, from
at least 2012 until at least 2017 various chicken industry
executives "conspired to fix prices and rig bids for broiler
chickens." The Plaintiff alleges that the time period covered by
the indictment fully overlaps with the class period (Feb. 21, 2014
through Nov. 21, 2016).
On July 31, 2020, the Defendants filed a motion to dismiss the
second amended complaint. Their primary arguments are that the
Plaintiff's Section 10(b) claims are time-barred by the five-year
statute of repose for securities actions, and that the Plaintiff
lacks standing to bring any remaining claims. The Plaintiff filed
his response on Aug. 31, 2020. The Defendants filed a reply on
Sept. 20, 2020.
The Plaintiff claims that the Defendants' untimeliness argument
fails for three reasons. First, he argues that the date of the
amended complaint is irrelevant for repose purposes because the
initial complaint was timely. Second, he claims that even if the
repose period applies to the second amended complaint, his claims
are timely under the continuing fraud exception for securities
claims. Third, the Plaintiff argues that his claims are not
time-barred because they are saved by the relation-back doctrine.
As to whether the Plaintiff's claims are time barred, Judge Jackson
finds that (1) the second amended complaint is subject to the
five-year statute of repose; (2) the continuing fraud exception
does not apply; and (3) the second amended complaint does not
relate back to date of the initial complaint. Thus, he holds that
any claims that are predicated on misstatements occurring prior to
June 8, 2015 are time-barred and must be dismissed.
As to whether the Plaintiff has Article III standing, Judge Jackson
finds that Mr. Hogan purchased his stock in Pilgrim's Pride Corp.
on Jan. 16, 2015 and Feb. 19, 2015. However, the Court has
previously found that all of Mr. Hogan's claims predicated on acts
or omissions occurring prior to June 8, 2015 are time-barred.
During the timeframe that falls within the statute of repose --
June 8, 2015 to June 8, 2020 -- Mr. Hogan did not purchase or sell
any stock. Instead, he merely continued to hold the stock he had
already purchased. Thus, according to the Birnbaum rule, Mr. Hogan
does not have standing to bring a Section 10(b) claim because he
was not an "actual purchaser or seller of securities" during the
repose period. Because Mr. Fuller lacks standing on any remaining
claims that are predicated on acts that occurred after June 8,
2015, the Court does not have jurisdiction to hear these claims.
The Defendants' motion to dismiss is therefore granted.
Based on the foregoing, Judge Jackson granted the Defendants'
motion to dismiss the amended complaint. To the extent that claims
are barred by the statute of repose, they are dismissed with
prejudice. To the extent Mr. Fuller's claims were barred by lack
of standing, which means lack of subject matter jurisdiction, they
are dismissed without prejudice, recognizing of course that unless
he can plead that he bought or sold the Defendant's stock within
the period of repose, his claims are effectively dismissed with
prejudice.
As the prevailing party, the Defendant is awarded reasonable costs
pursuant to Fed. R. Civ. P. 54(d)(1) and D.C.COLO.LCivR 54.1, to be
taxed by the Clerk following the submission of a bill of costs
pursuant to the rule.
A full-text copy of the Court's April 16, 2021 Order is available
at https://tinyurl.com/5cwbympj from Leagle.com.
REDDIT INC: Faces Suit Over Failure to Ban Child Pornography
------------------------------------------------------------
JANE DOE, on behalf of herself and all others similarly situated,
Plaintiff v. REDDIT, INC., Defendant, Case No. 8:21-cv-00768 (C.D.
Cal., April 22, 2021) is a class action against the Defendant for
receipt and distribution of child pornography, distribution of
private sexually explicit materials, unjust enrichment, and
violations of the Trafficking Victims Protection Act, the
California's Unfair Competition Law, and duty to report child
sexual abuse material.
The case arises from the Defendant's failure to prevent child
pornography on its websites. Despite Reddit's ability to enforce a
policy banning child pornography and its awareness of the continued
prevalence of child pornography on its websites, Reddit continues
to serve as a safe haven for such content. The Defendant's inaction
caused users to upload and post images and videos of commercial sex
acts. Moreover, Reddit knowingly benefits from lax enforcement of
its content polices, including for child pornography. By allowing
sensational and illegal content to be posted on Reddit, it receives
substantial advertising revenues, the suit asserts.
Reddit, Inc. is a social news aggregation, web content rating, and
discussion website operator, with its principal place of business
located at 1455 Market Street, Suite 1600, San Francisco,
California. [BN]
The Plaintiff is represented by:
Davida Brook, Esq.
Krysta Kauble Pachman, Esq.
SUSMAN GODFREY L.L.P.
1900 Avenue of the Stars, Suite 1400
Los Angeles, CA 90067
Telephone: (310) 789-3100
Facsimile: (310) 789-3150
E-mail: dbrook@susmangodfrey.com
kpachman@susmangodfrey.com
- and –
Arun Subramanian, Esq.
SUSMAN GODFREY L.L.P.
1301 Avenue of the Americas, 32nd Fl.
New York, NY 10019-6023
Telephone: (212) 336-8330
Facsimile: (212) 336-8340
E-mail: asubramanian@susmangodfrey.com
- and –
Steve Cohen, Esq.
POLLOCK COHEN LLP
60 Broad Street, 24th Fl.
New York, NY 10004
Telephone: (212) 337-5361
E-mail: scohen@pollockcohen.com
RUSHMORE LOAN: Raams Sues Over Kickbacks from Insurance Policies
----------------------------------------------------------------
JOHN RAAMS and AMY RAAMS, individually and on behalf of all others
similarly situated v. RUSHMORE LOAN MANAGEMENT SERVICES, LLC, a
Delaware limited liability company, Case No. 8:21-cv-00741-DOC-JDE
(C.D. Cal., April 20, 2021) seeks to recover damages equal to the
amount of the improper and inequitable financial benefit received
by Defendants and/or their affiliates as a result of Defendant's
practices relating to force-placed insurance policies.
According to the complaint, Defendant derives improper financial
benefits by imposing force-placed flood insurance policies on
properties. In addition, Defendant Rushmore is charging residential
borrowers for the "cost" of procuring force-placed insurance. A
portion of such "cost" is returned, transferred, kicked-back or
otherwise paid to Rushmore and/or its related entities. Rushmore
and/or its related entities do no meaningful work for the sums
received, and therefore the payments amount to an unearned kickback
designed to encourage the referral of business at extraordinarily
high prices, asserts the complaint.
Plaintiffs John Raams and Amy Raams own a home and resides
primarily in North Myrtle Beach, South Carolina. Plaintiffs
maintained flood insurance through the insurance provider of their
homeowner's association and provided proof of flood insurance to
Defendant on multiple occasions. Defendant declined to acknowledge
Plaintiffs' proof of secured insurance and charged them for a
considerably more expensive policy and forcedPlaintiffs to pay for
the policies by diverting the monthly mortgage payments and/or
debiting the borrowers' escrow accounts.
Plaintiffs challenge Rushmore's practice of purchasing force-placed
flood insurance to obtain a commission or kickback, resulting in
unauthorized, unjustified and unfairly inflated costs to the
borrower for force-placed insurance in violation of law. In doing
so, Rushmore acted with bad motive and bad intentions and in order
to penalize Plaintiffs and the Class, says the complaint.
Rushmore Loan Management Services, LLC is a Delaware limited
liability company. It maintains its principal place of business at
15480 Laguna Canyon Road, Suite 100, Irvine, CA 92618. [BN]
The Plaintiff is represented by:
Christopher P. Ridout, Esq.
Arielle M. Canepa, Esq.
2381 Rosecrans Avenue, Suite 328
Manhattan Beach, CA 90245
Telephone:(877) 500-8780
Facsimile:(877) 500-8781
SPEEDWAY LLC: Sends Unwanted Telemarketing Texts, Halawani Alleges
------------------------------------------------------------------
SHLOMY HALAWANI, individually and on behalf of all others similarly
situated, Plaintiff v. SPEEDWAY, LLC, Defendant, Case No.
CACE-21-008139 (Fla. 17th Jud. Cir. Ct., Broward Cty., April 22,
2021) is a class action against the Defendant for violations of the
Telephone Consumer Protection Act.
According to the complaint, the Defendant sent text messages to the
cellular telephones of the Plaintiff and Class members using an
automated telephone dialing system to promote its gas stations and
related services without their prior express consent.
Speedway, LLC is an American convenience store and gas station
chain, headquartered in Enon, Ohio. [BN]
The Plaintiff is represented by:
Manuel S. Hiraldo, Esq.
HIRALDO P.A.
401 E. Las Olas Boulevard, Suite 1400
Ft. Lauderdale, FL 33301
Telephone: (954) 400-4713
E-mail: mhiraldo@hiraldolaw.com
- and –
Jibrael S. Hindi, Esq.
Thomas J. Patti, Esq.
THE LAW OFFICES OF JIBRAEL S. HINDI
110 SE 6th Street, Suite 1744
Fort Lauderdale, FL 33301
Telephone: (954) 907-1136
E-mail: jibrael@jibraellaw.com
tom@jibraellaw.com
SPICY PIZZA: Munoz Sues Over Unpaid OT and Spread-of-Hours Premiums
-------------------------------------------------------------------
LUIS MUNOZ, individually and on behalf of all others similarly
situated, Plaintiff v. ALFONSO VALBUENA, ERNESTINA HERRERA, and
SPICY PIZZA CORP. (dba Spicy Pizza), Defendants, Case No.
1:21-cv-02235 (E.D.N.Y., April 22, 2021) is a class action against
the Defendants for violations of the Fair Labor Standards Act and
the New York Labor Law by failing to pay appropriate overtime
compensation and spread of hours premium and failing to maintain
accurate recordkeeping.
Mr. Munoz was employed by the Defendants at Spicy Pizza to prepare
pizza, deliver food, and wash dishes starting 2015 until April 12,
2020.
Spicy Pizza Corp. is the operator and owner of a pizzeria under the
name Spicy Pizza, with its principal place of business located at
43-22 43rd Avenue, Sunnyside, New York. [BN]
The Plaintiff is represented by:
Lina Stillman, Esq.
STILLMAN LEGAL, P.C.
42 Broadway, 12th Floor
New York, NY 10004
Telephone: (212) 203-2417
SYMPHONY JACKSON: Denial of Arbitration Bid in Herns Suit Reversed
------------------------------------------------------------------
In the case, MARILYN HERNS, as Guardian of the Estate of Clematine
Leonard, Plaintiff-Appellee v. SYMPHONY JACKSON SQUARE LLC, an
Illinois Limited Liability Company, d/b/a Symphony of Chicago West;
MAESTRO CONSULTING SERVICES, LLC, an Illinois Limited Liability
Company, and NORWEGIAN AMERICAN HOSPITAL, INC., Defendants,
(Symphony Jackson Square LLC and Maestro Consulting Services, LLC,
Defendants-Appellants), Case No. 1-20-1064 (Ill. App.), the
Appellate Court of Illinois, First District, Fifth Division:
(i) reverses the order denying the Defendants'
Section 2-619(a)(9) motion to compel arbitration and
remands for further proceedings consistent with
Section 2(a) of the Uniform Act; and
(ii) dismisses the appeal from the order denying the
Defendants' Section 2-619(a)(5) motion for lack of
jurisdiction.
Plaintiff Herns, as guardian of the estate of Clematine Leonard,
filed a second amended complaint against Defendants-Appellants,
Symphony and Maestro, alleging violations of the Nursing Home Care
Act ("Act") (210 ILCS 45/1-101 et seq. (West 2016)) against
Symphony and common-law negligence against Maestro. A third
Defendant, Norwegian-American Hospital, is not a party to the
appeal.
The Plaintiff filed her first amended complaint on Feb. 7, 2019, in
her capacity as the attorney-in-fact for Leonard pursuant to a
power of attorney entered into on Feb. 23, 2010. She alleged that
from Feb. 27, 2016, through June 10, 2016, Leonard was a resident
of Symphony, a long-term care nursing facility as defined in the
Act. Maestro, the management company and owner and/or operator of
Symphony, exercised significant control over Symphony's day-to-day
operations.
In count I against Symphony for violating the Act, the Plaintiff
alleged that Symphony committed various statutory violations and
negligent acts that led to Leonard developing multiple pressure
sores on her sacrum, right buttock, and left heel. In count II
against Maestro for common-law negligence, she alleged that Maestro
committed various other negligent acts that led to Leonard's
development of the pressure sores on her sacrum, right buttock, and
left heel.
Symphony and Maestro filed a motion to compel arbitration pursuant
to section 2-619(a)(9) of the Code. They argued therein that,
prior to Leonard arriving at Symphony, the Plaintiff was provided
an admission contract and an health care arbitration agreement
("HCA"), which she signed as the authorized representative on
Leonard's behalf. The HCA stated that any claim arising out of
injuries allegedly received by Leonard would be submitted to
binding arbitration, instead of to a court, and that all parties
would abide by the decision of the arbitration panel.
While the section 2-619(a)(9) motion to compel arbitration was
pending, the Plaintiff produced the Illinois statutory short form
power of attorney executed on Feb. 23, 2010, appointing her
Leonard's attorney-in-fact. The power of attorney form listed a
series of actions that the Plaintiff could perform on Leonard's
behalf. The power of attorney form expressly allowed certain
authority to be withheld by striking through non-permitted actions.
In pertinent part, Leonard struck through the following category
of powers that she did not want plaintiff to have: "claims and
litigation."
On June 7, 2019, the Defendants filed a motion to dismiss the
Plaintiff's first amended complaint pursuant to section 2-619(a)(2)
of the Code. They argued that the Feb. 23, 2010, power of attorney
appointing the Plaintiff as Leonard's attorney-in-fact specifically
precluded her from having any authority to engage in "claims and
litigation" on Leonard's behalf, meaning that the Plaintiff did not
have authority to prosecute the action.
On June 17, 2019, the Plaintiff filed a motion for leave to file a
second amended complaint. The second amended complaint was
substantively similar to the first amended complaint, except that
it provided that she was filing the action as guardian of Leonard's
estate rather than as Leonard's attorney-in-fact pursuant to the
power of attorney. The Plaintiff attached to the motion an order
from May 16, 2019, appointing her the limited guardian of Leonard's
estate. The order noted that Leonard has several legal
disabilities and that she lacks some but not all of the ability to
manage her estate or financial affairs. The order expressly gave
the Plaintiff the authority to "file a lawsuit for injuries
suffered by Leonard and make financial decisions on her behalf."
On July 25, 2019, the Defendants filed a motion objecting to the
Plaintiff's motion for leave to file a second amended complaint.
They again argued that the Feb. 23, 2010, power of attorney
specifically precluded her from having any authority to engage in
"claims and litigation" on Leonard's behalf.
On Sept. 9, 2019, the court granted the Plaintiff's motion to file
the second amended complaint.
On Jan. 7, 2020, the Defendants filed an amended motion to compel
arbitration, pursuant to section 2-619(a)(9), and a motion to
dismiss on limitations grounds, pursuant to section 2-619(a)(5).
On Feb. 7, 2020, the Plaintiff filed a response to the Defendants'
section 2-619(a)(9) motion to compel arbitration.
On Sept. 10, 2020, the circuit court entered an order denying the
section 2-619(a)(9) motion to compel arbitration, finding that
questions of fact existed with regard to whether an agency
relationship existed between the Plaintiff and Leonard and whether
the Plaintiff had the actual or the apparent authority to bind
Leonard to the HCA. The court also denied the Defendants' section
2-619(a)(5) motion to dismiss the Plaintiff's second amended
complaint based on the statute of limitations, finding that a
question of fact existed as to whether Leonard was legally disabled
so as to toll the limitations period. The court continued the
cause for "further proceedings."
Pursuant to Illinois Supreme Court Rule 307(a)(1) (eff. Nov. 1,
2017), the Defendants filed the interlocutory appeal from the order
denying the section 2-619(a)(9) motion to compel arbitration and
denying the section 2-619(a)(5) motion to dismiss on limitations
grounds.
First, the Appellate Court addresses the denial of the Defendants'
section 2-619(a)(9) motion to compel arbitration. The Plaintiff
initially contends that the Court should dismiss Defendant
Maestro's appeal from the Sept. 1, 2020, order for lack of standing
because that order states that "Symphony's motion to dismiss and
compel arbitration is denied" and does not explicitly state that it
is also denying Maestro's motion. The Plaintiff argues that
Maestro lacks standing to appeal an order that solely affects the
interest of other parties.
The Appellate Court declines to dismiss Maestro's appeal for lack
of standing. It explains that the section 2-619(a)(9) motion to
compel arbitration was a joint motion filed by both Symphony and
Maestro as codefendants seeking a single ruling compelling
arbitration. The circuit court denied that motion on grounds that
had nothing to do with any issue or argument that was unique to
Symphony or specific to Symphony's position in the case; rather,
the grounds for the denial of the motion (that issues of fact
existed regarding the existence and nature of the agency
relationship between the Plaintiff and Leonard) were as equally
applicable to Maestro as to Symphony. As such, despite the court's
short-h and reference to the joint motion to compel arbitration as
"Symphony's motion," its Sept. 1, 2020, order denying the motion
affected Maestro's interest as well as Symphony's interest in the
outcome of the controversy and did not deprive Maestro of standing
to contest that order on appeal.
The Plaintiff next argues that the Appellate Court lacks
jurisdiction over the Defendants' appeal from the denial of the
section 2-619(a)(9) motion to compel arbitration because by denying
the motion on the basis that questions of fact existed regarding
whether the Plaintiff was acting as Leonard's agent when signing
the HCA, the circuit court never reached the merits of whether the
dispute was arbitrable. She contends (without citation to any
pertinent authority) that the court's failure to resolve these
questions of fact precludes the Appellate Court from exercising
jurisdiction over its order denying the section 2-619(a)(9)
motion.
The Appellate Court's own research indicates that the court's
denial of the motion to compel arbitration based on the existence
of outstanding issues of fact does not deprive it of jurisdiction,
but that section 2(a) of the Uniform Act requires it to reverse and
rem and for it to conduct a summary proceeding and render a
substantive disposition of the issues raised in the motion.
In the present case, the circuit court expressly denied the
Defendants' motion to compel arbitration in the Sept. 1, 2020
written order. The Appellate Court finds that the Plaintiff points
to no oral ruling contradicting that order or raising an ambiguity
regarding whether it was reserving ruling on the motion to compel
arbitration; accordingly, the court's order is an injunctive one
for purposes of Rule 307(a)(1), and the Defendants' timely appeal
therefrom vests the Appellate Court with jurisdiction.
Addressing the merits of the Defendants' appeal, the Appellate
Court notes that, in the circuit court, the Plaintiff argued that
the motion to compel should be denied as no valid arbitration
agreement existed because she lacked the authority to sign the HCA
on Leonard's behalf and the HCA was unconscionable. In denying the
motion to compel arbitration, the court recognized the existence of
several fact questions but the court failed to make a substantive
determination of any of those issues. Where the trial court notes
the factual or legal issues of concern raised by the parties but
fails to make a substantive determination of the issues so raised,
there is not a sufficient showing to sustain the court's order
denying the motion to compel arbitration.
The Appellate Court reverses the Sept. 10, 2020 order denying the
section 2-619(a)(9) motion to compel arbitration and remands to the
circuit court with instructions to proceed summarily in accordance
with section 2(a) of the Uniform Act and to render a substantive
disposition with some explanation resolving the factual or legal
issues raised and determining the validity of the HCA.
Next, the Appellate Court addresses the Defendants' Rule 307(a)(1)
appeal from the portion of the Sept. 10, 2020 order denying their
section 2-619(a)(5) motion to dismiss the Plaintiff's second
amended complaint for violating the applicable two-year statute of
limitations. The court denied the section 2-619(a)(5) motion to
dismiss because it found that a question of fact existed regarding
whether Leonard was under a legal disability that tolled the
running of the limitations period. The portion of the September 10
order denying Defendants' motion to compel arbitration was
injunctive in nature and appealable under Rule 307(a)(1) because it
required the parties to refrain from doing a particular thing.
However, the denial of the Defendants' section 2-619(a)(5) motion
to dismiss based on the statute of limitations is not similarly
injunctive, and therefore it is not appealable under Rule 307.
The Defendants are asking the Appellate Court to review the court's
interlocutory order denying their section 2-619(a)(5) motion based
on the existence of a factual question regarding whether Leonard
was under a legal disability tolling the running of the statute of
limitations. The Appellate Court opines that such an order is not
injunctive and it also has no direct bearing on the court's denial
of the motion to compel arbitration, which was based not on
questions surrounding Leonard's legal disability but rather on the
completely unrelated questions regarding whether the Plaintiff had
the actual or apparent authority to bind Leonard to the HCA. As
the denial of the section 2-619(a)(5) motion to dismiss on
limitations grounds was not injunctive in nature and did not bear
directly on the court's denial of the motion to compel arbitration,
the Appellate Court lacks jurisdiction to consider it under Rule
307(a)(1).
For all the foregoing reasons, the Appellate Court reverses the
order denying the Defendants' section 2-619(a)(9) motion to compel
arbitration and remands for further proceedings consistent with
section 2(a) of the Uniform Act. It dismisses the appeal from the
order denying the Defendants' section 2-619(a)(5) motion for lack
of jurisdiction.
A full-text copy of the Court's April 16, 2021 Opinion is available
at https://tinyurl.com/8cdbwerr from Leagle.com.
Robert Marc Chemers -- rchemers@pretzel-stouffer.com -- and Scott
L. Howie -- showie@pretzel-stouffer.com -- of Pretzel & Stouffer,
Chtrd., of Chicago, and Ari B. Kirshner, of McCabe Kirshner, P.C.,
of Lincolnwood, for appellants.
Michael W. Rathsack -- mrathsack@rathsack.net -- of Chicago (Steven
M. Levin -- sml@levinperconti.com -- and Andrew J. Thut --
ajt@levinperconti.com -- of Levin & Perconti, of counsel), for
appellee.
TOYOTA MOTORS: Claims in Amended RAV4 Hybrid Fuel Tank Suit Trimmed
-------------------------------------------------------------------
In the case, IN RE TOYOTA RAV4 HYBRID FUEL TANK LITIGATION, Case
No. 20-cv-00337-EMC (N.D. Cal.), Judge Edward M. Chen of the U.S.
District Court for the Northern District of California granted in
part and denied in part Toyota's motion to dismiss the Plaintiffs'
consolidated class action complaint.
Toyota is a manufacturer and distributor of new motor vehicles; it
markets and advertises RAV4 Hybrids, oversees Toyota dealers, and
develops the company's nationwide marketing and informational
materials. The putative consumer class action is brought by 36
Plaintiffs from 28t states on behalf of a nationwide class of "all
persons who purchased or leased" 2019 and 2020 Toyota RAV4 Hybrid
vehicles," as well as 28 subclasses based on the state in which the
Vehicles were purchased or leased. The Plaintiffs allege that
Defendant Toyota ("TMS") falsely represented in marketing and
ownership materials that the Vehicles' fuel tank capacity is 14.5
gallons when it is actually 8-11 gallons, thus significantly
reducing the Vehicles' range on a single tank of gas.
The Plaintiffs bring 90 state-law claims against Toyota for breach
of express warranty, breach of the implied warranty of
merchantability, violations of various consumer protection and
unfair competition statutes, and unjust enrichment. They seek
damages, as well as injunctive and declaratory relief.
The Plaintiffs originally filed a class action complaint on Jan.
15, 2020. Over the following months, several cases from elsewhere
in the District were related to, and eventually consolidated with,
the instant case. Pursuant to these developments, the Plaintiffs
filed their 198-page consolidated class action complaint on Sept.
14, 2020.
Toyota's motion to dismiss followed on Oct. 14, 2020. It moved to
dismiss the Plaintiffs' consolidated class action complaint on the
grounds that the Plaintiffs lack Article III standing, that they
fail to state claims for relief under Rule 12(b)(6), that they lack
standing for injunctive and declaratory relief, and that they
cannot pursue their claims as a nationwide class.
The Plaintiffs then submitted an opposition brief on Nov. 4, 2020.
Following a brief continuation of the motion hearing, Toyota filed
its reply brief on Nov. 25, 2020.
Judge Chen previously ruled on a number of these issues at the
motion hearing of Dec. 18, 2020; he reiterates those conclusions
and resolves the issues he declined to decide at the hearing.
Discussion
Toyota's motion to dismiss is divided into seven main parts.
Toyota first argues that the Plaintiffs lack standing "because they
do not plausibly allege an actual, non-speculative injury" from the
purported fuel-tank defect, such as an imminent "safety hazard,"
"out-of-pocket costs for repairs," or "diminution in value" on
resale. Second, the Plaintiffs cannot plead breach of express
warranty as "TMS's express warranty in question does not cover
design defects" but only manufacturing defects. Third, the
Plaintiffs' claims for breach of the implied warranty of
merchantability are also inadequate because "they make no plausible
allegations that the vehicles are unfit for their ordinary
purpose." Fourth, the Plaintiffs fail to state consumer-protection
or unfair-competition claims because, inter alia, (a) the claims
are preempted by federal law, (b) the Plaintiffs fail to allege
reliance on Toyota's marketing materials, and (c) various
state-specific requirements have not been met. Fifth, the
Plaintiffs' unjust enrichment claim fails because they erroneously
seek to apply California law to the entire class and, in any event,
California doesn't recognize a standalone claim for unjust
enrichment. Sixth, the Plaintiffs lack standing to seek injunctive
and declaratory relief since none of them "alleges that s/he is
likely to purchase another Subject Vehicle." And seventh, the
Plaintiffs cannot represent a nationwide class since "they have no
standing to represent consumers in states where the Plaintiffs do
not reside and did not purchase a Subject Vehicle."
A. Standing (Injury-in-Fact)
Judge Chen finds that the Plaintiffs plausibly allege that their
vehicles suffer from an existing, provable defect of substantially
diminished fuel-tank capacity, and that this defect is significant
enough to make the vehicles worth less than they would be without
the defect. He says while the Plaintiffs have not provided a
quantitative analysis of the defect's impact on the market for
their Vehicles (a matter disputed by Toyota), the magnitude of that
impact is a question of fact not appropriate for resolution on a
motion to dismiss. Their harms are therefore "real" and not
"abstract" or merely speculative. Because the Plaintiffs have
adequately pled a cognizable injury for purposes of Article III and
have standing to pursue their claims, the Judge denied TMS' motion
to dismiss under Rule 12(b)(1).
B. Express Warranty Claims
As Toyota explains, the Plaintiffs assert breach of express
warranty claims under the laws of various states that have adopted
some iteration of U.C.C. Section 2-313." That provision of the
U.C.C. states, in relevant part: "Any affirmation of fact or
promise made by the seller to the buyer which relates to the goods
and becomes part of the basis of the bargain creates an express
warranty that the goods will conform to the affirmation or
promise." While the Plaintiffs' express warranty claims focus most
prominently on Toyota's New Vehicle Limited Warranty ("NVLW"),
Judge Chen holds that the claims are also founded on statements in
Toyota's advertising materials and the Vehicles' owner's manuals.
Therefore, Judge Chen granted Toyota's motion to dismiss the
Plaintiffs' express warranty claims under the NVLW without leave to
amend at this time. He also granted Toyota's motion to dismiss the
Plaintiffs' claims for breach of express warranty insofar as they
depend on Toyota's marketing materials or the Vehicle owner's
manuals. The Plaintiffs are granted leave to amend as to these
materials if they can allege pre-sale awareness of them. Lastly,
to the extent that Toyota moves to dismiss the express warranty
claims on the grounds that the Idaho, Montana, North Dakota,
Oregon, and Wisconsin the Plaintiffs failed to satisfy U.C.C.
notice requirements, that aspect of the motion is denied.
C. Implied Warranty of Merchantability Claims
The Plaintiffs bring claims for breach of the implied warranty of
merchantability in all states in which they reside. The gravamen
of their claims is that, because of the fuel tank defect, the
Vehicles "were not in merchantable condition" at the time of sale
or lease "and are not fit for the ordinary purpose for which
vehicles are used." In its motion to dismiss, Toyota argues that
the Plaintiffs' implied warranty claims fail because "they do not
allege facts showing that their vehicles are unmerchantable or
unfit for their ordinary purpose.
Judge Chen finds that the Plaintiffs' allegations do not raise a
serious question of the Vehicles' fitness for reasonably safe and
reliable transportation. Therefore, the Plaintiffs have failed to
state an implied warranty claim. Toyota's motion to dismiss on
this basis is granted. Because amendment would be futile at this
stage, the Plaintiffs do not have leave to amend.
D. Consumer Protection Claims: General Issues
The Plaintiffs have brought claims under the consumer protection
(and/or unfair competition) statutes of all 28 states in which they
reside. They allege that Toyota made affirmative
misrepresentations about the Vehicles' fuel tank capacity and that
the company unlawfully failed to disclose the alleged fuel tank
defect to consumers. In its motion to dismiss, among other things,
Toyota argues that the Plaintiffs' fraud and consumer protection
theories fail because the claim based on the use of EPA estimates
in advertisements and other materials is preempted by federal law.
Judge Chen finds that the Plaintiffs do not specifically address
Toyota's preemption argument in their opposition brief. But he
rejects Toyota's preemption argument and denied its motion to
dismiss on that ground. He finds that the Plaintiffs argue that
Toyota's advertisements concerning the Vehicles' mileage ranges are
deceptive because they are based on misrepresentations about fuel
tank capacity, not MPG calculations. These allegations clearly "go
beyond the mere disclosure of the estimated fuel economy of the
Vehicles."
Toyota's motion to dismiss the Plaintiffs' consumer protection
claims based on an affirmative misrepresentation theory is granted
insofar as (1) the applicable statutes require that the Plaintiffs
knew of and/or relied on the alleged misrepresentations and (2) the
complaint fails to identify those misrepresentations known to
and/or relied on by teh Plaintiffs with any specificity. Since the
parties have not briefed the issue of the statutes' reliance
requirements, the Judge declines to rule on the Plaintiffs' claims
on a state-by-state basis at this time.
The Judge also finds that the Plaintiffs have adequately alleged
Toyota's exclusive knowledge of the defect at the time of sale as
part of their omission-based consumer protection claims. To the
extent that Toyota's motion to dismiss is based on applicable
statutes' requirement of such exclusive knowledge, the motion is
denied.
Toyota is correct, however, that the complaint fails to allege that
the company engaged in active concealment with respect to the fuel
tank defect. While the complaint repeats the language of each
state's consumer protection statute in stating, for example, that
Toyota "engaged in unlawful trade practices by employing deception,
deceptive acts or practices, fraud, misrepresentations, or
concealment, o] suppression or omission of any material fact with
intent that others rely upon such concealment," it fails to allege
facts that would plausibly support such boilerplate assertions.
The Plaintiffs' omission-based consumer protection claims are
therefore barred insofar as they require a showing of active
concealment. Toyota's motion to dismiss is granted on this
ground.
E. Consumer Protection Claims: State-Specific Issues
Toyota next argues that, in addition to the global issues it
identifies regarding the Plaintiffs' consumer protection claims,
the complaint "fails to sufficiently plead additional elements
required to sustain their state-specific claims." The parties have
grouped these narrower issues into 13 categories.
Among other things, Judge Chen holds that (i) Toyota's motion to
dismiss California the Plaintiffs' omission-based consumer
protection claims on the ground that the Plaintiffs fail to
establish a duty to disclose is thus denied on the grounds stated,
(ii) Toyota's motion to dismiss the Colorado, Iowa, Oregon, and
Virginia consumer protection claims on the basis of inadequately
pled knowledge or intent is denied, (iii) the Plaintiffs'
allegations that they have suffered damages is plausible for
purposes of the motion to dismiss and Toyota's motion to dismiss
the Connecticut and North Dakota consumer protection claims on the
basis of inadequately pled damages is therefore denied, (iv) Toyota
fails to respond to these arguments in its reply brief, suggesting
that it has abandoned the motion as to this aspect of the Florida
Act, and its motion to dismiss the Florida consumer protection
claim on the basis of the demand-letter requirement is therefore
denied, and (v) although "the Pennsylvania Supreme Court has not
weighed in directly on the applicability of the economic loss
doctrine to the UTPCPL," Pennsylvania's appellate courts and the
Third Circuit now agree that the economic loss doctrine does not
preclude UTPCPL claims, therefore Toyota's motion to dismiss the
Pennsylvania the Plaintiffs' consumer protection claim on the basis
of the economic loss doctrine is denied.
F. Unjust Enrichment
The Plaintiffs assert a claim for unjust enrichment under the
common law of California, but they contend that "the claim would be
nearly identical under the laws of any other state." In its motion
to dismiss, Toyota argues that unjust enrichment in California "is
not a cause of action, but a theory of recovery and California
courts routinely dismiss such 'claims.'"
Judge Chen holds that the California Plaintiffs' allegations
concerning Toyota's presale knowledge of the fuel tank defect
adequately state a claim for unjust enrichment on the theory that
the Plaintiffs "have conferred a benefit" on Toyota, which the
company "has knowingly accepted under circumstances that make it
inequitable for the Defendant to retain the benefit without paying
its value." Toyota's motion to dismiss the Plaintiffs' unjust
enrichment claim is denied with respect to the California
Plaintiffs.
The Judge also denied Toyota's motion to dismiss the Plaintiffs'
unjust enrichment claims as to the California Plaintiffs. BUt he
granted the motion with respect to the non-California Plaintiffs
without leave to amend. He finds that California's interest in
applying its law to residents of foreign states is attenuated and
that "each class member's unjust enrichment claim should be
governed by the unjust enrichment laws of the jurisdiction in which
the transaction took place."
G. Standing for Injunctive and Declaratory Relief
The Plaintiffs also seek injunctive and declaratory relief
requiring Defendants to cease and desist from representing that the
Vehicles have a fuel-tank capacity of 14.5 gallons. Toyota
contends that the Plaintiffs lack standing to seek such relief
because they fail to allege that they are "likely to purchase
another Subject Vehicle," and they repeatedly state that they would
not have purchased the products, or would have paid less for them,
had they known that the Vehicles' fuel tanks could only hold 8-11
gallons.
Because the Plaintiffs fail to allege that they either plan or are
likely to purchase another Vehicle, they do not presently have
Article III standing to pursue injunctive or declaratory relief as
sought in the complaint. Judge Chen therefore granted Toyota's
motion to dismiss as to these claims but granted the Plaintiffs
leave to amend.
H. Nationwide Class Allegations
Finally, Toyota argues that the Plaintiffs' attempt to represent a
nationwide class is untenable because the Plaintiffs include
citizens of only 28 states. It contends that the Plaintiffs cannot
assert claims on behalf of those who purchased or leased Vehicles
in 22 other states. The Plaintiffs respond that TMS seeks
premature resolution of the class allegations at least with respect
to a nationwide class, denying the Plaintiffs the opportunity to
make the case for certification based on appropriate discovery.
Judge Chen denied Toyota's motion to dismiss the Plaintiffs'
nationwide class allegations at this time. He reserves the right
to revisit the issue at its discretion as the litigation
progresses. The Judge concluded that the issue would be better
addressed a later juncture, such as at class certification.
Conclusion
For these reasons, Judge Chen granted in part and denied in part
Toyota's motion to dismiss the Plaintiffs' consolidated class
action complaint. He (i) denied as to the Plaintiffs' standing to
assert claims for damages; (ii) granted as to the Plaintiffs'
express warranty claims under the NVLW (without leave to amend);
(iii) granted as to the Plaintiffs' express warranty claims under
Toyota's marketing materials and Vehicle owner's manuals (with
leave to amend); (iv) granted as to the Plaintiffs' implied
warranty of merchantability claims (without leave to amend); (v)
granted as to the Plaintiffs' affirmative misrepresentation claims
under certain state consumer protection laws (with leave to amend);
(vi) denied as to the Plaintiffs' fraudulent omission claims under
certain state consumer protection statutes; (vii) granted in part
and denied in part as to the Plaintiffs' consumer protection claims
on various state-specific grounds; (viii) denied as to California
Plaintiffs' unjust enrichment claim; (ix) granted as to
non-California Plaintiffs' unjust enrichment claims (without leave
to amend); (x) granted as to the Plaintiffs' standing to assert
claims for injunctive and declaratory relief (with leave to amend);
(xi) denied as to the Plaintiffs' nationwide class allegations.
The Plaintiffs will file their amended complaint by June 9, 2021,
and the Defendant will file its response by July 23, 2021.
The Order disposes of Docket No. 66.
A full-text copy of the Court's April 16, 2021 Amended Order is
available at https://tinyurl.com/8pdtk4n7 from Leagle.com.
VENATOR MATERIALS: Retirement Systems Appeal N.Y. Sup. Ct. Order
----------------------------------------------------------------
In the putative class action lawsuit styled MACOMB COUNTY
EMPLOYEES' RETIREMENT SYSTEMS and FIREMEN'S RETIREMENT SYSTEM OF
ST. LOUIS, individually and on behalf of all others similarly
situated v. VENATOR MATERIALS PLC, SIMON TURNER, KURT D. OGDEN,
STEPHEN IBBOTSON, RUSS R. STOLLE, CITIGROUP GLOBAL MARKETS INC.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, GOLDMAN SACHS &
CO. LLC, and J.P. MORGAN SECURITIES LLC, Case No. 651771/2020, the
Plaintiffs appeal to the Appellate Division of the State of New
York, First Judicial Department, on April 22, 2021 from the
decision and order of the Supreme Court of the State of New York,
New York County, Commercial Division, dated March 22, 2021, to
grant the Defendants' motions to dismiss.
Macomb County Employees' Retirement Systems is a pension fund based
out of Mount Clemens, Michigan.
Firemen's Retirement System of St. Louis is a financial planner in
St. Louis, Missouri.
Venator Materials PLC is a global manufacturer and marketer of
chemical products, headquartered in Stockton-on-Tees, United
Kingdom.
Citigroup Global Markets Inc. is a company that provides banking
and financial services, headquartered in New York, New York.
Merrill Lynch, Pierce, Fenner & Smith Incorporated is an investment
management company, headquartered in New York, New York.
Goldman Sachs & Co. LLC is an investment management company,
headquartered in New York, New York.
J.P. Morgan Securities LLC is a securities brokerage company,
headquartered in New York, New York. [BN]
The Plaintiffs are represented by:
Jonathan Gardner, Esq.
Alfred L. Fatale III, Esq.
Lisa Strejlau, Esq.
LABATON SUCHAROW LLP
140 Broadway, 34th Floor
New York, NY 10005
Telephone: (212) 907-0700
Facsimile: (212) 818-0477
E-mail: jgardner@labaton.com
afatale@labaton.com
lstrejlau@labaton.com
- and –
Spencer A. Burkholz, Esq.
Henry Rosen, Esq.
Matthew J. Balotta, 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: spenceb@rgrdlaw.com
henryr@rgrdlaw.com
mbalotta@rgrdlaw.com
- and –
Samuel H. Rudman, Esq.
ROBBINS GELLER RUDMAN & DOWD LLP
58 South Service Road, Suite 200
Melville, NY 11747
Telephone: (631) 367-7100
Facsimile: (631) 367-1173
E-mail: srudman@rgrdlaw.com
*********
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