TILA Class Action Defense Cases-McKenna v. First Horizon: First Circuit Holds As Matter Of First Impression That Rescission Relief Under Federal Truth In Lending Act (TILA) Not Appropriate For Class Action Treatment

As Matter of First Impression, Class Action Treatment for Rescission Claims Under TILA (Truth in Lending Act) is not Proper First Circuit Holds Plaintiffs filed a putative class action in Massachusetts federal court against First Horizon Home Loan alleging that it violated the federal Truth in Lending Act (TILA) and its state law equivalent, the Massachusetts Consumer Credit Cost Disclosure Act (MCCCDA) by failing to accurately disclose to borrowers their statutory rescission rights.

Certification of Class Actions Class Action Court Decisions RESPA/TILA Class Actions Uncategorized

Class Action Defense Cases-In re New Century Mortgage: Judicial Panel On Multidistrict Litigation (MDL) Denies Defense Request To Centralize Class Action Litigation In The Central District of California

Class Action Lawsuits did not Warrant Pretrial Coordination Pursuant to 28 U.S.C. § 1407 Judicial Panel on Multidistrict Litigation (MDL) Holds Three class action lawsuits were filed in Indiana and California against New Century Financial, New Century Mortgage and Home123; Indiana plaintiffs’ lawyer moved the Judicial Panel on Multidistrict Litigation (MDL) to centralize the lawsuits for pretrial purposes in the Northern District of Indiana, but then moved to withdraw the request “asserting that they have reached an agreement with plaintiff in [one of] the Central District of California [cases] .

Class Action Court Decisions Multidistrict Litigation Uncategorized

Bluetooth Class Action Defense Case—In re Bluetooth Headset: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion Joined In By Defense Attorneys To Centralize Class Action Litigation In The Central District Of California

Judicial Panel Agrees Pretrial Coordination Pursuant to 28 U.S.C. § 1407 is Warranted for Class Actions Involving Bluetooth Headsets and Grants Request, Supported by Defense and Plaintiffs in Other Class Actions, to Centralize Litigation in Central District of California Numerous class action lawsuits – seeking both statewide and nationwide class certification – were filed in several states against Motorola, Plantronics, GN Jabra North America and GN Netcom, “seek[ing] relief under various theories of liability, such as unjust enrichment, breach of express and/or implied warranties, and strict products liability” based on the central allegation that use of Bluetooth headsets may cause hearing loss.

Class Action Court Decisions Multidistrict Litigation Uncategorized

Carnival Class Action Defense Case-Borcea v. Carnival: Florida Federal Court Approves Settlement Of Employment Law Class Action

Terms of Proposed Class Action Settlement of Employee Claims Against Carnival Found to be Fair, Adequate and Reasonable by Florida Court

Putative class actions were filed against Carnival by former employees on behalf of several thousand workers alleging that Carnival manipulated employee time records and deprived employees of wages due; the class actions sought unpaid wages, attorney fees and costs, penalty wages, and injunctive relief. Borcea v. Carnival Corp., 238 F.R.D. 664, 667-68 (S.D. Fla. 2006). After extensive motion practice, and while one of the class actions was on appeal following a district court order dismissing the class action with prejudice, the parties agreed upon terms for a settlement and presented the proposal to the district court for approval. Id., at 668. The district court approved the proposed settlement, finding the terms to be fair, adequate and reasonable. The terms of the class action settlement are extensive and detailed. We summarize here only the district court’s legal conclusions in approving the resolution of the class actions; the reader is encouraged to review the opinion itself for details of the settlement. See id., at 668-72.

In considering the motion, the district court observed that while any proposed class action settlement requires court approval, see FRCP Rule 23(e), there is “a strong judicial policy in favor of settlement” and in the Eleventh Circuit a settlement “should be approved as long as it is ‘fair, adequate and reasonable and it is not the product of collusion between the parties.'” Borcea, at 672 (quoting Bennett v. Behring Corp., 737 F.2d 982, 986 (11th Cir. 1984)). The district court summarized the factors it considers in determining whether the proposed class action settlement is fair, adequate and reasonable as follows: “(1) the likelihood of success at trial; (2) the range of possible recovery; (3) the point on or below the range of possible recovery at which a settlement is fair, adequate and reasonable; (4) the complexity, expense and duration of litigation; (5) the substance and amount of opposition to the settlement; and (6) the stage of proceedings at which the settlement was achieved. Id., at 672-73 (citation omitted).

Class Action Court Decisions Uncategorized

FDCPA Class Action Defense Cases-Rivera v. Amalgamated Debt Collection Services: Florida Federal Court Holds Debt Collector Violated § 1692g Of Fair Debt Collection Practices Act But Issues Of Fact Exist As To § 1692e Claims

Debtor need not Pay Debt to have Standing to Prosecute Federal Fair Debt Collection Practices Class Action and Debtor Entitled to Summary Judgment on § 1692g Claim because Collection Letter did not Track Statute but Triable Issues of Fact Existed as to Alleged Violations of § 1692e(5) and (10) as the Language in Collection Letters was Subject to Reasonable and Different Interpretations Florida Court Holds

Plaintiff filed a putative class action against a debt collector, Amalgamated Debt Collection Services, for violations of the federal Fair Debt Collection Practices Act (FDCPA) and various state laws arising out of its efforts to collect $39.32. Rivera v. Amalgamated Debt Collection Services, Inc., 462 F.Supp.2d 1223, 1225-26 (S.D. Fla. 2006). Plaintiff moved for partial summary judgment as to defendant’s liability for violating the FDCPA, id., at 1225; defense attorneys argued that triable issues of fact exist, and that plaintiff lacked standing, id., at 1227. The district court granted the motion in part, but agreed with defense attorneys that triable issues of fact existed as to interpretation of certain language in debt collection letters.

The facts are straight-forward: In an effort to collect a debt, Amalgamated sent plaintiff two letters, each of which stated in pertinent part, “unless this matter can be resolved within 30 days of the above date, it will be necessary to consider the institution of legal procedures against you” and that she had 30 days from the date of the letters to dispute the validity of the debt, Rivera, at 1225-26; it was undisputed, however, that Amalgamated had never commenced legal proceedings in an effort to collect a debt, id., at 1226. Amalgamated also sent plaintiff a letter stating “that her failure to remit payment within 15 days would result in the ‘nationwide reporting’ of her debt as a ‘bad debt.'” Id. Plaintiff moved for partial summary judgment.

Class Action Court Decisions FDCPA Class Actions Uncategorized

Class Action Defense Cases-Bishop’s v. Protective Life: Georgia Federal Court Denies Defense Motion To Dismiss Class Action Based On Defense Tender Of Damage Check To Class Representative

Post-Class Action Complaint Tender of Amount Sought by Class Action Plaintiff does not Render Claim Moot or Deprive Federal Court of Subject Matter Jurisdiction Georgia Court Holds

Plaintiff filed a putative class action against his credit insurance coverage carrier, Protective Life, alleging that it refused to refund unearned premiums for early termination of insurance coverage. Bishop’s Prop. & Investments, LLC v. Protective Life Ins. Co., 463 F.Supp.2d 1375, 1376 (M.D. Ga. 2006). The credit insurance in question involved vehicle loans: in return for a single premium, Protective Life promised to make the loan payments in the event of the insured’s death or disability. In plaintiff’s case, he purchased a vehicle with a 72-month loan term, but he paid off the loan in only 11 months. Id. Because the loan had been paid in full, the insurance policy terminated. The class action alleged that insureds who paid off their loans early were entitled to refunds of the “unearned premiums.” Id., at 1376-77. After the filing of the class action complaint, defendant tendered a refund to plaintiff, which he refused to accept. Id., at 1376. Defense attorneys then moved for summary judgment arguing that, despite his refusal to accept the check, the tender mooted plaintiff’s claim thereby depriving the court of subject matter jurisdiction over the class action. Id. Under the defense theory, Protective Life “issued a check for the total amount of unearned premiums owed to Plaintiff under its credit insurance policy,” and that tender divested the federal court of jurisdiction because “Plaintiff’s personal claims became moot the moment [Protective Life] ‘refunded in full the unearned premiums that [Plaintiff] claims are due.'” Id., at 1377. The district court denied the motion.

The district court phrased the issue at page 1377 as follows: “Under what circumstances does a legal controversy for Article III purposes continue to exist in a class action after the named plaintiff’s individual claims become moot?” The court recognized that generally the claims of the class representative must be “live” not only at the time the class action is filed but at the time of class certification as well; if it is not, then “the court lacks a justiciable controversy” and the class action must be dismissed. Id. (citation omitted). The district court provided a concise explanation behind the purpose of the rule at pages 1377 and 1378:

Certification of Class Actions Class Action Court Decisions Uncategorized

American Express Class Action Defense Case—Berry v. American Express: As Matter Of First Impression California Court Holds Issuance Of Credit Card Falls Outside Scope Of Consumer Legal Remedies Act (CLRA)

Act of Extending Credit “Separate and Apart from any Sale or Lease of Goods or Services” Falls Outside the Scope of California’s Consumer Legal Remedies Act (CLRA) California Court Holds

Plaintiff filed a putative class action against various American Express entities seeking injunctive relief under California’s Consumer Legal Remedies Act (CLRA) in connection with arbitration clause contained in his American Express cardholder agreement. Berry v. American Express Publishing, Inc., 147 Cal.App.4th 224, 54 Cal.Rptr.3d 91, 92 (Cal.App. 2007). Defense attorneys demurred to the complaint, arguing that issuing a credit card does not fall within the scope of the CLRA. The trial court agreed with the defense arguments and sustained the demurrer to the class action complaint without leave to amend. The appellate court affirmed, concluding that “the extension of credit, such as issuing a credit card, separate and apart from the sale or lease of any specific goods or services, does not fall within the scope of the act.” Id.

After plaintiff began receiving an Amex publication called “Travel + Leisure” and noticed a $43 charge on his credit card statement for the magazine, he telephoned American Express Centurion Bank and American Express Publishing, the subscription was canceled, and the charge was reversed. Berry, at 93. Plaintiff then filed a putative class action against various American Express entities alleging that defendants charged customers for magazines that they never ordered. Id. Ultimately, the class action complaint was amended to contain but a single cause of action for declaratory relief “which alleged the arbitration clause and class action waiver in the cardholder agreement violated CLRA.” Id. Thus, the complaint sought solely to prohibit enforcement of the arbitration clause in the cardholder agreement. Defense attorneys demurred and the trial court sustained the demurrer without leave to amend, dismissing the class action complaint with prejudice. Id.

Arbitration Class Action Court Decisions Uncategorized

Class Action Defense Cases-In re Movie Artwork: Judicial Panel On Multidistrict Litigation (MDL) Denies Defense Motion To Centralize Class Action Litigation In The Central District of California

Class Action Lawsuits Involving Copyright and Trademark Infringement Claims did not Warrant Pretrial Coordination Pursuant to 28 U.S.C. § 1407 Judicial Panel on Multidistrict Litigation (MDL) Holds Four class action lawsuits were filed against several defendants alleging various copyright and trademark infringement claims involving “different copyrights and trademarks owned by different entities and covering different movie and cartoon characters.” In re Movie Artwork Copyright Litig., 473 F.Supp.2d 1381, 1382 (Jud. Pan.

Class Action Court Decisions Multidistrict Litigation Uncategorized

Class Action Defense Cases—In re Static Random Access: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion To Centralize Class Action Litigation In The Northern District of California

Judicial Panel Grants Plaintiff Request, Unopposed by Defense and Supported by Plaintiffs in Other Cases, for Pretrial Coordination Pursuant to 28 U.S.C. § 1407 Numerous class action lawsuits were filed against several defendants alleging “[a] conspiracy to fix the price of Static Random Access Memory.” In re Static Random Access (SRAM) Antitrust Litig., 473 F.Supp.2d 1384, 1384-85 (Jud. Pan.Mult.Lit. February 9, 2007). Plaintiff’s lawyer in one of the class actions moved the Judicial Panel on Multidistrict Litigation (MDL) pursuant to 28 U.

Class Action Court Decisions Multidistrict Litigation Uncategorized

State Farm Katrina Class Action Defense Case-Roby v. State Farm: Louisiana Federal Court Grants Motion To Remand Class Action To State Court Holding Hurricane Is Not An Accident Under Federal MMTJA

A Hurricane is not an “Accident” under the Federal Multiparty, Multiforum Trial Jurisdiction Act (MMTJA) and Defense Failed to Prove that Individual was Fraudulently Joined for Purposes of Defeating Diversity Jurisdiction over Class Action Louisiana Federal Court Holds

Plaintiffs filed a putative class action in Louisiana state court against their homeowners insurance carrier, State Farm, alleging that it wrongfully denied insurance benefits for damage caused by Hurricane Katrina. Roby v. State Farm Fire & Cas. Co., 464 F.Supp.2d 572, 574 (E.D. La. 2006). Specifically, after plaintiffs provided State Farm evidence that Hurricane Katrina caused them to suffer more than $400,000 in damages, State Farm tendered a $23,000 check to plaintiffs representing its “estimated damages for their claim for damages to their home” and ultimately refused to pay plaintiffs’ claim in full or to pay policy limits because it concluded that “[plaintiffs’] home sustained flood damage from Hurricane Katrina and that flood damages are excluded from the policy.” Id. State Farm also denied personal contents benefits on the ground that flood damage excluded coverage, id., at 574 n.5. Plaintiffs countered that their home had sustained damage caused by rain that entered through holes in the roof caused by the hurricane, and filed a class action complaint for a declaratory judgment that the exclusion relied upon by State Farm did not apply and, alternatively, that their State Farm agent should have informed them to obtain flood insurance. Id., at 574-75. Defense attorneys removed the class action to federal court, asserting both federal question and diversity jurisdiction. Id., at 575 and n.6. As to diversity, defense attorneys argued that plaintiffs had named the State Farm agent solely to defeat diversity. Id. Plaintiffs filed a motion for remand. The district court granted plaintiffs’ motion and remanded the class action to state court.

After noting that State Farm bore the burden of proof as the party invoking federal court jurisdiction, Roby, at 575, the district court addressed State Farm’s argument that federal jurisdiction exists under the Multiparty, Multiforum Trial Jurisdiction Act (MMTJA) – “specifically 28 U.S.C. § 1369 . . . and its corresponding removal statute, 28 U.S.C. § 1441(e),” id. As the district court explained at pages 575 and 576, “Section 1369 is a federal statute that establishes subject matter jurisdiction in federal court over a single accident in which at least 75 persons died. Section 1441 allows a defendant to remove a § 1369 case to federal court. Congress enacted the MMTJA to allow full consolidation of state and federal cases related to a common disaster in order to eliminate multiple or inconsistent awards arising from multiforum litigation.” (Footnote and citations omitted.) The district court held that MMTJA did not apply because a hurricane is not an “accident” within the meaning of the Act, id., at 576.

Class Action Court Decisions Removal & Remand Uncategorized