CLASSIFIED: Carlton Fields' Class Action Blog

The Los Angeles Times reports that BP has been sued in "at least 250 class action lawsuits" seeking damages "expected to reach into the double-digit billions" arising from the oil rig explosion in the Gulf of Mexico in April.  The Los Angeles Times says that the "vast majority" of the suits have been filed by "fisherman, charter operators, restaurants and property owners claiming financial losses after the disaster shut down fisheries and pummeled coastal tourism."

Bingo players in Alabama continue to file class action lawsuits seeking to establish that gambling contracts are void and they are therefore entitled to get back the money they lost playing electronic bingo.

In In re Burlington Northern Santa Fe Railway Co., __ F.3d __, 2010 WL 1980172 (7th Cir. May 19, 2010), the Seventh Circuit Court of Appeals reiterated the “well-established general rule … that jurisdiction is determined at the time of removal, and nothing filed after removal affects jurisdiction.” Id. at *2.

Last month, the Seventh Circuit became the first circuit court to rule on the question of whether a district court must conclusively rule on the admissibility of an expert opinion prior to class certification when that opinion is critical to the class certification decision. In American Honda Motor Co., Inc. v. Allen, 600 F.3d 813 (7th Cir. Apr. 7, 2010), the court answered in the affirmative, thereby vacating the district court’s order granting class certification.

Last week, in Shady Grove Orthopedic Associates, P. A. v. Allstate Insurance Co., ___ S.Ct. ___, 2010 WL 1222272 (March 31, 2010), the United States Supreme Court held that a state law prohibiting a particular type of class action does not apply in a federal court sitting in diversity.

A group of seventeen major networks and production studios, as well as talent agencies, settled a class action lawsuit filed against them by television writers alleging that the companies discriminated against the writers due to their age.

An Xbox user filed a class action lawsuit against Microsoft alleging that Microsoft wrongfully failed to provide the goods and services he paid for with "Microsoft Points," which allow Xbox users to purchase games and other downloadable media from the Xbox Live Marketplace.

Residents living near fraternities at University of California at Berkeley filed a class action lawsuit seeking to require the fraternities to have live-in adult supervisors to curb alleged alcohol abuse, littering and noise violations.

The law firm Coughlin Stoia Geller Rudman & Robbins LLP filed a putative securities class action on behalf of purchasers of Advanta Corp. Class A and/or Class B common stock between October 31, 2006 and November 27, 2007, alleging that Advanta issued materially false and misleading statements by failing to disclose the impact of the economic environment and credit trends on its business and failed to adequately and timely record losses for its impaired loans and customer delinquencies.

Union-based pension funds that filed a putative class action against Freddie Mac are challenging in court the company's position that "secrecy agreements" prohibit former employees from discussing with them the allegations that Freddie Mac executives defrauded investors by concealing the company's exposure to high-risk mortgages, its losses, and its inadequate capital position. Under the agreements, former employees are permitted to answer questions from government officials related to criminal cases or regulatory proceedings. But, barring a court order, the former employees are prohibited from talking with anyone involved in a civil lawsuit against the company.

On Monday, bank customers filed a putative class action in the Southern District of Florida against Bank of America, Wachovia, U.S. Bank, JPMorgan Chase and Citibank seeking restitution as well as actual and punitive damages resulting from the banks' overdraft fee policies.  Lead plaintiffs' counsel Bruce Rogow commented in a press release that "[c]harging a $35 overdraft fee when a college student uses her debit card to buy a cup of coffee is unconscionable."

After an appellate decision finding that passenger fees charged by the Bridgeport Port Authority to ferry passengers since 1993 were unconstitutional, a putative class action lawsuit has been filed against the Bridgeport Port Authority by passengers seeking a refund of the passenger fees they paid.

Aerosmith will play a concert tonight in Hawaii to settle class action claims filed by disappointed fans who sued Aerosmith after it cancelled a 2007 concert in Hawaii.  The fans alleged that the concert cancellation cost them between $500,000 and $3 million in travel and other expenses.

A class action lawsuit claiming $1 billion in damages has been filed against SoHo nightclub Greenhouse.  The lawsuit alleges that the club denied access to people who were invited to the club to celebrate author Teri Woods' new book because of their race.

Supreme Court Indicates that Requiring Defendant to Pay Costs of Class Notification Without a Hearing is a Denial of Due Process – In DTD Enterprises, Inc. v. Wells, No. 08-1407, 2009 WL 3255157 (U.S. Oct. 13, 2009), the United States Supreme Court denied a petition for writ of certiorari filed by DTD Enterprises, Inc., a commercial dating-referral service. DTD initially filed a contract action against one of its customers, Janice Wells, alleging that Wells refused to make certain payments due under her contract with DTD. Wells, in turn, brought a class action against DTD. The trial court certified the class and ordered DTD to bear all the costs of class notification because Wells could not afford to pay those costs herself.

Justice Kennedy, joined by Chief Justice Roberts and Justice Sotomayor, wrote a statement regarding the denial of certiorari. In the statement, Justice Kennedy acknowledged that the denial of certiorari was appropriate because (1) the petition was interlocutory, given that the New Jersey appellate courts had denied DTD leave to appeal the trial court’s actions, and (2) the action fell within the scope of an automatic stay entered when DTD filed for bankruptcy.

Residents of St. Petersburg, Florida filed a class action lawsuit against Raytheon Corporation alleging that the company knowingly polluted the Azalea neighborhood with industrial waste, lowering the residents' property values.  The complaint also alleges that Raytheon engaged in a concerted effort to misrepresent and withhold information regarding the extent of the contamination.  Judge Covington of the United States District Court for the Middle District of Florida granted the residents' motion for class certification this week, and according to news sources over 1,000 residents are eligible to join the class.  Earlier this year, Raytheon predicted it would cost over $20 million just to clean up the plume of contaminants in the water beneath the neighborhood.

A subscriber to online dating service Match.com filed a putative class action lawsuit alleging that the company misled subscribers by keeping the profiles of cancelled members online.  The lawsuit alleges that the company put subscribers in the position of feeling humiliated after sending emails to cancelled members and receiving no response.

Zurich-based reinsurer Swiss Re thinks so.  In a recent report, Swiss Re concludes that "climate change-related liability will develop more quickly than asbestos-related claims" and "the frequency and sustainability of climate change-related litigation could become a significant issue within the next couple of years."  Swiss Re points out that although the first asbestos claims in the 1950's were not successful, later suits have been successful.  Swiss Re predicts that the same litigation cycle could occur with respect to climate change claims, which so far have not been successful, but which could be in the future, especially given the current political climate.

Swiss Re is not alone in comparing climate change lawsuits to mass tort litigation:  lawyers who filed a climate change suit last February on behalf of the Alaskan city of Kivalina plan to use the "same game plan" used by plaintiffs' lawyers in tobacco litigation to recover damages from oil, coal, and electric companies whose emissions have allegedly shortened the season during which the sea was frozen, causing severe coastal erosion.  Specifically, the lawyers plan to prove that the companies conspired to cover up the threat of man-made climate change, preventing measures that might have slowed the problem.

Read more to learn about the industries at risk due to these and other climate change legal theories and how the current political climate may impact this litigation risk.

Surgery centers filed a class action lawsuit in federal court in Georgia against Blue Cross Blue Shield of Georgia alleging that the insurer unfairly reimbursed out-of-network providers.

A Georgia appeals court reversed a trial court's decision dismissing a putative class action brought by consumers against Georgia Natural Gas alleging that the gas company overcharged them for the standard variable-rate plan.

After a class action lawsuit was filed against Liberty National Life Insurance alleging that the insurer discriminated against Haitian Americans, Florida's Office of Insurance Regulation (OIR) began investigating the insurer.  After several months of investigation, the OIR has issued an order to the insurer asking it to provide proof that it did not violate state laws that prohibit discrimination. 

Two hospitals filed an antitrust class action lawsuit in federal court in Pennsylvania against two suppliers of blood reagents alleging that they have conspired since 2000 to increase the price for blood reagents by as much as 1,000 percent and have illegally allocated customers.

Social Security recipients brought a class action against Bank of America alleging that the bank violated California state law by taking overdraft fees from accounts set up to receive Social Security benefits.  This week, the California Supreme Court overturned a jury verdict in favor of the class, holding that banks could properly collect overdraft fees from such accounts.  The attorney who represented the Social Security recipients says that some class members lost as much as 20% of their monthly income in a single day due to overdraft fees.

Nine lawsuits have been filed against a number of financial institutions and operators in Western Pennsylvania alleging that they violated the Electronic Funds Transfer Act by failing to post signs on or around ATMs notifying customers of fees. 

The United States Justice Department is investigating whether some technology companies violated antitrust laws by agreeing not to actively recruit employees from each other, according to an article published in the New York Times based on information from people with knowledge of the investigation.

The United States Supreme Court will decide whether Merck investors can maintain a securities class action against the company as a result of its disclosures regarding Vioxx.  A federal district court judge dismissed the lawsuit, ruling that the statute of limitations had expired.  The Third Circuit Court of Appeals reversed.  The Supreme Court will now decide when the statute of limitations began to run.

A federal district court judge in Colorado approved a $695 million settlement resolving a securities class action against Qwest Communications International, Inc.

The United States Judicial Panel on Multidistrict Litigation will decide the proper venue for the Chinese drywall class action lawsuits.  Last Thursday, the MDL Panel heard arguments in favor of the following cities:  Miami, Tampa, Fort Meyers, New Orleans, and Columbus, Ohio.

Purchasers of units within the Trump International Hotel and Towers in Fort Lauderdale Beach, Florida filed a class action lawsuit this week alleging, among other things, that they were misled about the involvement of Donald Trump in the project.  The purchasers seek a refund of their deposits and punitive damages.

A class action lawsuit was filed against Air Tran Airways and Delta Air Lines, alleging that the two air carriers colluded to start charging customers an extra fee to check bags.

Ticketmaster has been sued in a class action lawsuit in Canada alleging that Ticketmaster illegally resold concert tickets in a secondary market for more than their face value.  The person who filed the suit tried to buy Smashing Pumpkins concert tickets on Ticketmaster's website for $66.55 (Canadian dollars) but was redirected to the TicketsNow website, where he purchased tickets for $533.65 (Canadian dollars).  According to RollingStone.com, Live Nation's Michael Rapino said about the suit, "class action lawsuits have no merit, it's like chasing cars down the road."

A similar class action lawsuit has been filed against Ticketmaster in federal court in New Jersey alleging that it fraudulently raised prices by sending online customers to a subsidiary reseller.

A Missouri appeals court reinstated a $17 million jury verdict against American Family Mutual Insurance Company in a class action lawsuit alleging that the company had used inferior equipment to repair insureds' vehicles.  The trial judge had thrown out the verdict, finding that the plaintiffs failed to prove their theory of damages.

A federal judge in Oklahoma granted class status to a lawsuit filed on behalf of foster children alleging that the children suffered abuse as a result of deficiencies in the state's foster care system.

Seventh Circuit Decertifies Multi-State Class Action Alleging Consumer Protection Act Violations – In an opinion sure to raise the ire of class counsel around the nation, the Seventh Circuit Court of Appeals decertified a multi-state class action against Sears, Roebuck & Co. alleging false advertising under various state consumer protection statutes and individual claims for violations of Tennessee’s Consumer Protection Act.  Thorogood v. Sears, Roebuck & Co., 547 F.3d 742 (7th Cir. 2008).  The named plaintiff brought the action in federal district court on behalf of himself and other purchasers, scattered across 28 states and the District of Columbia, of the more than half million Kenmore dryers advertised as containing stainless steel drums.  Plaintiff alleged that the part of the front of the drum was made not of stainless steel, but of a ceramic-coated “mild” steel.  Plaintiff contended that the sale of dryers so advertised was deceptive unless the drums were made entirely of stainless steel, because if they were not, they may rust and cause rust stains on clothes in the dryer.

The district court granted plaintiff’s motion for class action certification, determining class action treatment was warranted because “Sears marketed its dryers on a class wide basis…reliance [therefore] can be presumed.”  The Seventh Circuit granted Sears’ appeal and reversed.

Juveniles and their family members filed a class action lawsuit against two former judges who pleaded guilty to accepting money in exchange for ordering young defendants to serve time in privately run detention centers.  The lawsuit seeks compensation for emotional harm caused to the juveniles.

Five former employees of Citigroup filed class charges of discrimination with the Equal Employment Opportunity Commission, alleging that female employees were not paid the same as male employees and that in recent layoffs male employees were retained at the expense of female employees.

General Reinsurance Corporation will pay $72 million in connection with a five-year-old class action suit brought by the Ohio Attorney General's office against American International Group, Inc (AIG) and other defendants, alleging that General Reinsurance conducted a fraudulent reinsurance transaction that allowed AIG to inflate its loss reserves.