Class Action Defense Cases—In re Whirlpool: Judicial Panel On Multidistrict Litigation (MDL) Grants Defense Motion To Centralize Class Action Litigation But Only For Certain Class Actions And Selects Northern District Of Ohio As Transferee Court

Judicial Panel Grants Defense Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407, Opposed by All Class Action Plaintiffs, but Limits Scope of Centralization Order to Only Five (5) of the Eight (8) Class Actions at Issue, and Transfers Actions to Northern District of Ohio rather than Illinois as Requested by Defense Attorneys Eight class actions – four in Illinois, two in New Jersey, and one in Ohio and New York – were filed against various defendants, including Whirlpool and Sear, Roebuck, alleging products liability claims; specifically, the class action complaints alleged that “certain front-loading washing machines manufactured by Whirlpool and sold under the Whirlpool brand name contain design defects that cause the machines to fail to drain properly, thereby resulting in the creation of mold, mildew, and associated unpleasant odors.

Class Action Court Decisions Multidistrict Litigation Uncategorized

Anti-Spam Class Action Defense Cases–Kleffman v. Vonage: Following Dismissal Of Class Action Ninth Circuit Certifies Question Concerning California’s Anti-Spam Law To California Supreme Court

Propriety of District Court Dismissal of Anti-Spam Class Action Complaint would Benefit from California Supreme Court Interpretation of Statute Ninth Circuit Holds Plaintiff filed a class action against Vonage Holdings, Vonage America and Vonage Marketing (collectively “Vonage”) alleging violations of California’s anti-spam law. Kleffman v. Vonage Holdings Corp., ___ F.3d ___ (9th Cir. December 17, 2008) [Slip Opn., at 16588]. According to the class action complaint, Vonage or its marketing agents sent 11 unsolicited email advertisements to plaintiff; the class action alleged that “each e-mail contained an advertisement stating, ‘You Could Save up to 50% on Your Phone Bill!

Class Action Court Decisions Uncategorized

Class Action Defense Cases–In re Mattel: California Federal Court Dismisses Class Action Claims Under Consumer Protection Safety Act But Refuses To Dismiss Remaining Class Action Claims Arising From Sale Of Lead Tainted Toys

Class Action Complaint Alleging Various Claims Arising from Manufacture and Sale of Toys Tainted with Lead Paint Survives Defense Motion to Dismiss, Save for Class Action Claims under Consumer Protection Safety Act (CPSA) California Federal Court Holds

Numerous class action complaints were filed against various defendants, including are Mattel and Fisher-Price (“Manufacturer Defendants”) and Target, Toys “R” Us, Wal-Mart Stores, KB Toys and Kmart (“Retailer Defendants”), alleging labor law violations; the class action complaint asserted that a computer error caused Sprint to systematically fail to properly calculate commissions due employees of Sprint’s Business Direct Channel. In re Mattel, Inc. Toy Lead Paint Products Liab. Litig., ___ F.Supp.2d ___ (C.D.Cal. November 24, 2008) [Slip Opn., at 1 and nn.2 and 3]. According to the class actions, certain toys manufactured and sold by defendants contained unsafe levels of lead paint. _Id._, at 1. The toys at issue in the class action lawsuits “were subject to recalls ordered by the Consumer Product Safety Commission (‘CPSC’) in which the Manufacturer Defendants provided replacement toys.” _Id._ The Judicial Panel on Multidistrict Litigation consolidated the class action lawsuits in the Central District of California, which eventually granted a motion to certify the litigation as a class action, _see id._ The consolidated class action complaint sought damages under theories of strict liability and negligence, breach of express and implied warrantees, and for violations of the federal Consumer Protection Safety Act (CPSA) and California’s Consumers Legal Remedies Act (CLRA). _Id._, at 2. Defense attorneys moved the district court to dismiss the second amended class action complaint, _id._, at 1. The district court granted the motion and dismissed the class action.

Preliminarily, the federal court rejected the defense argument that defendants’ voluntary recall and replacement of the tainted toys, pursuant to CPSC Regulations, precluded a state law claim for refund. See In re Mattel, at 3-4. The district court also found that the class action adequately alleged injury, see id., at 4-6; as the court explained at pages 5 and 6, “The Court knows of no authority for the proposition that a defendant can defeat a plaintiff’s claim on standing grounds through the unilateral offering of a remedy of the defendant’s choosing.” Additionally, the federal court rejected defense claims that the class action theories “sounded in fraud” and so had to be pleaded with particularity, see id., at 6-7, and rejected also defense claims that the Retailer Defendants owed no duty to inspect for latent defects and, accordingly, could not be found liable for negligence, id., at 7-8.

Class Action Court Decisions Uncategorized

H&R Block CAFA Class Action Defense Cases–Marshall v. H&R Block: Illinois Federal Court Remands Class Action To State Court Holding Modifications To Class Definition Did Not Support Removal Under Class Action Fairness Act (CAFA)

Trial Court Amendments to Class Definitions in Response to Defense Motion to Decertify Class Action did not Create a “New Action” Sufficient to Justify Removal under Class Action Fairness Act of 2005 (CAFA) Illinois Federal Court Holds

Plaintiffs filed a state court class action complaint against H&R Block Tax Services in January 2002 alleging “statutory fraud by omission in violation of the Illinois Consumer Fraud Act (‘ICFA’) and ‘the substantially similar statutes of specific sister states’ and breach of fiduciary duty.” Marshall v. H&R Block Tax Services Inc., ___ F.Supp.2d ___ (S.D.Ill. December 17, 2008) [Slip Opn., at 2]. According to the allegations underlying the class action, H&R Block sold a “Peace of Mind” (POM) guarantee – an “extended-warranty product under which consumers are paid additional taxes owed as a result of a tax-preparation error.” _Id._, at 1. The state court granted plaintiffs’ motion to certify the litigation as a class action, and subsequently partially granted a defense motion to decertify the class action. _Id._ Following partial decertification of the class action, defense attorneys removed the class action to federal court claiming removal jurisdiction under the Class Action Fairness Act of 2005 (CAFA); according to H&R Block’s theory, “the decertification order greatly increased its potential liability for POM sales with which it had no involvement, which commenced a new, removable cause of action.” _Id._, at 1-2. Plaintiffs’ moved to remand the class action to federal court, arguing that “the state court’s August 5, 2008 decertification order narrowed the action from a multistate class to a thirteen-state class”; accordingly, it did not constitute the commencement of a new action for purposes of removal under CAFA. _Id._, at 1. The district court granted the motion and remanded the class action to state court.

After summarizing the applicable legal standard, see Marshall, at 2-4, the district court noted that the defense removed the class action based on the state court’s decision to amend the class definition to address, in part, the defense motion to decertify, id., at 4. The defense argued “[the] amended class definitions commenced a new action by expanding the scope of Block’s potential liability to include the acts of entities merely affiliated with Block as well as independent franchisees.” Id. According to the federal court, the state court believed that his modifications to the class definitions “related back to Plaintiffs’ amended complaint” and “expressly set forth his rationale for limiting the Plaintiff Classes to make the action more manageable and to eliminate from the action those states where applicable laws differed significantly.” Id., at 7. The federal court rejected defense arguments that the new class definitions “greatly increased” H&R Block’s liability and thus constituted a new lawsuit within the meaning of CAFA. Id., at 7-9. Put simply, the amendments to class definitions did not add any “new or different POM transactions” to the case; accordingly, the class action “does not fall within the ambit of ‘sufficiently independent of the original contentions that it must be treated as fresh litigation.’” Id., at 10 (citation omitted). In sum, “Block has identified no basis for the Court to conclude that the state court’s modification of the classes commenced a new, removable action.” Id. Accordingly, it remanded the class action to state court, id., at 11.

Certification of Class Actions Class Action Court Decisions Class Action Fairness Act (CAFA) Uncategorized

UCL Class Action Defense Cases–Davis v. Pacific Capital: Ninth Circuit Holds Bank Not Required To Refund Any Portion Of Finance Charge Assessed For IRS Refund Anticipation Loan Following Early Payoff By Borrower

As Matter of First Impression, Finance Charge by Bank for IRS Refund Anticipation Loan was not “Interest” within the Meaning of 15 U.S.C. § 1615 so District Court Properly Dismissed Class Action Ninth Circuit Holds Plaintiff filed a class action against Pacific Capital Bank alleging violations of California’s Unfair Competition Law (UCL); the class action complaint alleged that plaintiff obtained a “Refund Anticipation Loan” (RAL) from the Bank secured by her “anticipated federal income tax refund” and authorized the IRS to deposit her refund into an account established by the Bank.

Class Action Court Decisions Uncategorized

2008 Class Action Lawsuits End Year With Substantial Increase In Labor Law Class Action Filings In California State And Federal Courts

As a resource to California class action defense attorneys, we provide weekly, unofficial summaries of the legal categories for new class action lawsuits filed in the California state and federal courts located in Los Angeles, San Francisco, San Jose, Sacramento, San Diego, San Mateo, Oakland/Alameda and Orange County areas. We include only those categories that include 10% or more of the class action filings during the preceding week. This report covers the period from December 19 – 31, 2008, during which time only 38 new class action lawsuits were filed.

Class Actions In The News Uncategorized

Class Action Defense Cases—In re Countrywide: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion To Centralize Class Action Litigation But Selects Western District of Kentucky As Transferee Court

Judicial Panel Grants Plaintiff Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407, Supported by All Responding Parties including Other Class Action Plaintiffs and Countrywide Defendants, but Transfers Class Actions to Western District of Kentucky Six class actions –three in California, two in Florida, and one in Missouri – were filed against Bank of America and various Countrywide entities, together with other defendants, alleging violations of the federal Fair Credit Reporting Act (FCRA).

Class Action Court Decisions FCRA Class Actions Multidistrict Litigation Uncategorized

HAPPY NEW YEAR’S DAY FROM THE CLASS ACTION DEFENSE BLOG

The author of the Class Action Defense Blog wishes all of you a very happy New Year. A new class action article will be published tomorrow.

Class Actions In The News Uncategorized

CLASS ACTION DEFENSE BLOG OFF FOR NEW YEARS

The author of the Class Action Defense Blog is taking the day off for the New Year holiday. A new class action article will be published on Friday, January 2.

Class Actions In The News Uncategorized

FLSA Class Action Defense Cases–Bernal v. Vankar: Texas Federal Court Grants Class Action Plaintiffs Summary Judgment In Labor Law Class Action Concluding Employers Failed To Pay Minimum Wages And Overtime Required By FLSA

Class Action Plaintiff Alleging Violations of Fair Labor Standards Act (FLSA) Entitled to Summary Judgment because Employers Improperly took “Tip Credits” Against Employee Wages and Failed to Pay Overtime Required by FLSA Texas Federal Court Holds

Plaintiff filed a class action against his former employers – TDS Entertainment (which owns Dixie’s Country Bar), Chicago Bar and Vankar Enterprises (which owns Babcock Bar) – alleging violations of the federal Fair Labor Standards Act (FLSA); the class action complaint asserted that defendants failed to pay employees minimum wage because they unlawfully credited tips against their employees’ salaries. Bernal v. Vankar Enterprises, Inc., 579 F.Supp.2d 804, 805 (W.D.Tex. 2008). Specifically, the class action alleged that plaintiff worked at defendants’ bars for less than the federal minimum wage, that plaintiff received tips from customers, and that defendants required that plaintiff contribute a portion of his tips to a “tip pool” to be shared with “managers and/or other employees who do not customarily and regularly receive tips.” Id., at 805-06. The class action alleged that defendants were not permitted to take “tip credits” against plaintiff’s minimum, and so violated the FLSA by paying him less than minimum wage. Id., at 806. The class action complaint prayed to recover as wages the difference between the federal minimum wage and the actual wage paid by defendants., id. The district court granted plaintiff’s motion for class action certification, id. Plaintiff’s counsel then moved for summary judgment as to “(1) whether the bars failed to pay the applicable minimum wage under circumstances in which the bars were not permitted to claim a tip credit; and (2) whether the bars failed to pay overtime as required by the FLSA.” Id. The federal court granted the motion.

The district court explained that “[t] he primary issue before the Court is whether a genuine issue of material fact exists regarding Defendants’ entitlement to use the amount of tips its employees received in satisfaction of a portion of Defendants’ minimum wage obligations.” Bernal, at 806. After summarizing the well-known standards governing summary judgment motions, see id., at 806-07, the court discussed the FLSA’s authorization, under “limited circumstances,” to pay a “tipped employee” less than the federal minimum wage, id., at 807. A “tipped employee” – defined as an employee who customarily receives more than $30 per month in tips, see 29 U.S.C. § 203(t), may be paid less than minimum wage (but no less than $2.13 per hour) “if the amount of the tips the employee actually receives, added to the hourly wage the employer pays, is at least equal to the minimum wage in effect,” a practice known as “taking a ‘tip credit.’” Bernal, at 807. The district court explained, however, that “An employer may not…take a tip credit ‘with respect to any tipped employee unless such employee has been informed by the employer of the [tip credit] provisions’” and that “no tip credit may be taken ‘with respect to any tipped employee unless … all tips received by such employee have been retained by the employee,’ except in cases in which tips are pooled ‘among employees who customarily and regularly receive tips.’” Id. (citations omitted).

Class Action Court Decisions Employment Law Class Actions Uncategorized