Sprint Class Action Defense Cases–Harlow v. Sprint: Kansas Federal Court Grants Class Action Treatment To Labor Law Class Action Against Sprint Alleging Systematic Failure To Properly Calculate Commissions Due Employees

Class Action Complaint Alleging Computer Problems Systematically Caused Sprint to Pay Employees Less than they were Due Warranted Class Action Treatment as Common Issues – Centered on Sprint’s Computer System – Predominated Class Action Claims Kansas Federal Court Holds

Plaintiffs filed a class action against Sprint Nextel Corporation and Sprint/United Management (collectively “Sprint”) 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. Harlow v. Sprint Nextel Corp., ___ F.Supp.2d ___ (D.Kan. December 10, 2008) [Slip Opn., at 1-2]. According to the allegations underlying the class action, these computer problems resulted in Sprint employees receiving each month $500-$1000 less than the amounts they were due, _id._, at 2. The class action centered, then, on a “problem with Sprint’s computer system that affects the amount of commissions the class members received.” _Id._ Originally, the class action complaint alleged causes of action for violations of Kansas’s Wage Payment Act, breach of contract, quantum meruit, promissory estoppels and unjust enrichment, but the parties stipulated to the dismissal of all claims except the Wage Payment Act and breach of contract class action claims. _Id._, at 4-5. Plaintiffs’ attorneys moved the district court to certify the litigation as a class action; defense attorneys argued against class action treatment. _Id._, at 1. The district court determined that class action treatment was warranted and therefore granted plaintiffs’ class action certification motion.

In ruling on the class action certification motion, the federal court stressed that the class action “centers on Sprint’s computerized procedures for calculating and paying commissions and not, for example, [on] a policy-based decision by Sprint to award a particular commission to one employee over another.” Harlow, at 5. The district court stressed that “[t]his distinction is key to the certification analysis.” Id. As the district court had little difficulty in finding that the requirements for class action certification under Rule 23(a) had been met, see id., at 13-17 (discussing numerosity, commonality, typicality, and adequacy of representation), we focus here – like the court – on the class action requirements set forth in Rule 23(b)(3). And in that regard, the federal court had little difficulty in determining that a class action is a superior means of resolving the issues presented in the complaint, rejecting Sprint’s objection that “a class action of this magnitude would be unmanageable because of the individualized inquiries to each plaintiffs’ claims” because the individual questions involved damage calculations. See id., at 11-13.

Certification of Class Actions Class Action Court Decisions Employment Law Class Actions Uncategorized

FDCPA Class Action Defense Cases–Quiroz v. Revenue Production Management: Illinois Federal Court Certifies Class Action Holding Requirements For Certification Of Rule 23(b)(3) Class Action Had Been Met

FDCPA Class Action Complaint Warranted Class Action Treatment because Plaintiff Satisfied Requirements for Rule 23(b)(3) Class Illinois Federal Court Holds

Plaintiff filed a class action against Revenue Production Management, Inc., a debt collection agency, alleging violations of the federal Fair Debt Collection Practices Act (FDCPA); the class action complaint asserted “that Defendant had a policy and practice of violating Section 1692e of the FDCPA by: (1) sending [debt collection letters] after the expiration of the 30-day validation period outlined in the initial communication; (2) informing the consumer that the debt must be disputed in writing after expiration of the 30-day validation period outlined in the initial communication; and (3) informing the consumer that a dispute must be made within 30 days of the initial communication, after the expiration of the 30-day validation period outlined in the initial communication.” Quiroz v. Revenue Production Management, Inc., 252 F.R.D. 438, 440 (N.D. Ill. 2008). Plaintiff’s lawyers filed a motion with the district court to certify the litigation as a class action. Id. The district court concluded that class action treatment was warranted and granted plaintiff’s motion.

Plaintiff incurred debts in connection with medical treatment he received, but “[he] did not pay the debt because he believed it was covered by his employer’s workers’ compensation insurance.” Quiroz, at 440. After plaintiff defaulted on the obligation, it was assigned to defendant who sent plaintiff an initial debt collection letter on April 17, 2007. Id. It was not until June 6, 2007, however, that defendant sent a letter to plaintiff advising him that “[i]f you dispute the validity of this debt then you must notify us in writing within 30 (thirty) days of our initial notice to you.” Id. Plaintiff’s class action certification motion asserted that a Rule 23(b)(3) class action should be certified, id., at 440-41.

Certification of Class Actions Class Action Court Decisions FDCPA Class Actions Uncategorized

Class Action Defense Cases–Starbucks v. Superior Court: California State Appellate Court Orders Judgment In Favor Of Starbucks In Labor Law Class Action Holding Named Plaintiffs In Class Action Suffered No Injury

Class Action Seeking Statutory Damages on behalf of all Applicants could not Survive Defense Motion for Summary Judgment because Class Action Representatives Suffered no Injury and Legislature did not Intend to Permit Unaffected Individuals to Recover Statutory Damages California State Court Holds

Plaintiffs filed a class action against Starbucks alleging violations of California labor law provisions concerning information collected from prospective employees during the application process; specifically, the class action complaint asserted that Starbucks improperly asked applicants “about prior marijuana convictions that are more than two years old.” Starbucks v. Superior Court, 168 Cal.App.4th 1436 (Cal.App. 2008) [Slip Opn., at 2]. According to the class action, “Starbucks uses the same two-page job application form nationwide for store level employees” and that one of the questions asked is, “Have you been convicted of a crime in the last seven (7) years?” Id. The application makes clear that “arrests are not convictions,” and advises that a conviction “will not necessarily disqualify you for employment.” Id. The class action sought statutory damages in the amount of $200 per applicant – “a remedy which, by Starbucks’ estimation, could total a whopping $26 million.” Id. The trial court granted plaintiffs’ motion for class action treatment, certifying a class of approximately 135,000 applicants. Id. The trial court certified the class action on behalf of all applicants who completed a questionnaire with the convictions question and who sought no more than $200 in damages, id., at 5. In the trial court’s words, “The mere offering of the application containing the impermissible question is a violation of the Labor Code. [¶] Damages may be calculated simply by multiplying the probable number of applicants during the class period times $200.00.” Id. Defense attorneys moved for summary judgment of the class action claims, asserting in part that class members suffered no damage. Id., at 2. The trial court denied the motion, and defense attorneys sought extraordinary relief from the Court of Appeal, id. The California Court of Appeal reversed, concluding that “[n]othing in the statutes in question authorizes job applicants to automatically recover $200 per person without proof they were aggrieved persons with an injury the statute was designed to remedy,” and ordered the trial court to enter judgment in favor of Starbucks.

The thrust of the class action was that California prohibits employers “from asking about marijuana-related convictions that are more than two years old.” Starbucks, at 4. The class action further argued that California law permits applicants “to recover actual damages or $200 each, whichever is greater.” Id. (citations omitted). The appellate court observed, however, that Starbucks disclosed on the reverse side of the application that California applicants need not disclose marijuana-related convictions that are more than two years old, stating in full: “CALIFORNIA APPLICANTS ONLY: Applicant may omit any convictions for the possession of marijuana (except for convictions for the possessions of marijuana on school grounds or possession of concentrated cannabis) that are more than two (2) years old, and any information concerning a referral to, and participation in, any pretrial or post trial diversion program.” Id., at 2-3. Notably, each of the named plaintiffs had read the disclaimer on the reverse of the Starbucks application and each understood that they were not required to disclose any marijuana convictions that were more than two years old; moreover, none of the named plaintiffs had been arrested for or convicted of a marijuana-related crime. Id., at 4-5. The Court of Appeal summarized at page 2, “Plaintiffs’ lawsuit suffers from two fundamental flaws, either of which provides ample grounds for writ relief. First, Starbucks attempted to disclaim an interest in such prohibited information, and two of the plaintiffs understood Starbucks not to be seeking it. Second, no plaintiff had any marijuana-related convictions to reveal.”

Certification of Class Actions Class Action Court Decisions Employment Law Class Actions Uncategorized

New Labor Law Class Action Lawsuits Continue To Hold Top Spot Among Weekly Class Action Filings In California State And Federal Courts

As a resource for California class action defense attorneys, we provide weekly, unofficial summaries of the legal categories for new class action lawsuits filed in California state and federal courts in the 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 5 – 11, 2008, during which time only 31 new class action lawsuits were filed.

Class Actions In The News Uncategorized

Class Action Defense Cases—In re Velocity Express: Judicial Panel On Multidistrict Litigation (MDL) Grants Defense Motion To Centralize Class Action Litigation But Selects Eastern District of Wisconsin

Judicial Panel Grants Defense Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407, Unopposed by Class Action Plaintiffs, but Transfers Class Actions to Eastern District of Wisconsin Eight class actions – one in New Jersey and one in Pennsylvania – were filed against common defendants Velocity Express Corp., Velocity Express, Inc., and Velocity Express Leasing, Inc. (collectively “Velocity Express”), and others, alleging labor law violations; specifically, the class action complaints alleged that defendants misclassified package delivery drivers as independent contractors rather than as employees.

Class Action Court Decisions Employment Law Class Actions Multidistrict Litigation Uncategorized

Class Action Defense Cases-Kullar v. Foot Locker: California Court Reverses Approval Of Class Action Settlement Holding Insufficient Evidence Provided To Support Reasonableness Of Class Action Settlement Particularly As To Class Action’s Meal Period Claim

Approval of Class Action Settlement of Labor Law Class Action must be Vacated and Remanded because Trial Court Lacked Sufficient Evidence to Determine Reasonableness of Proposed Class Action Settlement and because Objector (Plaintiff in a Separate Class Action) Wrongfully Denied Discovery Regarding Class Action Settlement California State Court Holds

Plaintiff filed a class action against Foot Locker alleging violations of California’s Labor Code; the class action complaint asserted that defendant failed to reimburse employees for expenses related to mandatory uniforms as required by California law. Kullar v. Foot Locker Retail, Inc., ___ Cal.App.4th ___ (Cal.App. November 7, 2008) [Slip Opn., at 2]. The class action complaint later was amended to include allegations concerning security checks performed by Foot Locker, and to include class action claims for missed meal and rest periods, and for overtime. _Id._ Foot Locker denied the allegations and asserted 23 affirmative defenses, _id._, at 3. Plaintiff’s discovery was limited, as were defendant’s responses, and did not include any of the theories advanced in the amended class action complaint (such as the meal period claim); further, while defense attorneys deposed the named plaintiff, plaintiff did not depose any of defendant’s officers or employees. _Id._ Eventually, the parties reached a proposed settlement of the class action, and the trial court gave preliminary approval to the class action settlement. _Id._, at 4. As finally approved, the class action settlement called for Foot locker to pay a maximum of $2 million, of which $500,000 would be sought as attorney fees by plaintiff’s counsel, with the settlement proceeds payable on a sliding scale, depending on the length of time worked by the employee and the number of forms returned by members of the class. _See id._, at 4-6. It was estimated that approximately $1.3 million would be available for the class, and that individual payments could fall within a wide range – for example, the highest amount an individual class member may receive ranged from $2,900 to more than $30,000, depending on the number of participants in the settlement. _See id._, at 6. Before the parties requested preliminary approval of the class action settlement, a separate class action was filed by Crystal Echeverria against Foot Locker alleging _inter alia_ failure to provide meal breaks, _id._, at 7. Echeverria objected to the proposed class action settlement and sought discovery from the parties, including the deposition of Foot Locker’s person most knowledgeable about “meal period breaks, record keeping for meal period breaks, and payment of compensation for missed meal period breaks.” _Id._ The trial court denied leave to depose Foot Locker as “irrelevant because it related either to liability, which ‘doesn’t matter for the settlement,’ or to the amount of damages.” _Id._, at 8. The trial court ultimately approved the class action settlement over Echeverria’s objection, _id._, at 9-11, and she appealed. The California Court of Appeal reversed.

The appellate court recognized the limited scope of its review: “Our task is not to make an independent determination of whether the terms of the settlement are fair, adequate and reasonable, but to determine ‘only whether the trial court acted within its discretion.’” Kullar, at 11 (citation omitted). “Great weight” is afforded to trial courts in approving class action settlements, and the trial court’s finding will not be reversed absent an abuse of discretion. Id. Here, the trial court concluded that the class action settlement warranted approval because the four relevant factors were met – viz., the settlement was reached at arm’s-length, sufficient investigation and discovery had been pursued so as to allow the parties and the court to act intelligently, counsel were experienced in similar litigation, and only a small percentage of putative class members objected to the class action settlement. Id., at 11-12. Echeverria conceded that most of these factors indeed had been met, but she insisted that the second factor was missing because plaintiff plainly failed to conduct the investigation necessary to settle the meal period claim, id., at 12. The appellate court agreed.

Uncategorized

Class Action Defense Cases– Stewart v. Cheek & Zeehandelar: Ohio Federal Court Certifies (b)(2) Class Action But Refuses To Certify (b)(3) Class Action Of FDCPA Class Action Claims Against Law Firm Debt Collector

FDCPA Class Action Claims Certified as a (b)(2) Class after Modification of Class Definition but (b)(3) Class Lacked Predominance as Mini-Hearings would be Required to Establish Damages for each Class Member Ohio Federal Holds

Plaintiffs filed a class action against Cheek & Zeehandelar (an Ohio-based law firm that litigates debt collection actions) and two of its attorneys alleging violations of the federal Fair Debt Collection Practices Act (FDCPA) and Ohio’s Consumer Sales Practices Act (CSPA); specifically, the class action complaint alleged that defendant “seeks to garnish or attach the property of Ohio consumers who have defaulted on credit and loan agreements, without having first investigated the nature of the debtors’ property to determine if it is legally exempt from garnishment or attachment.” Stewart v. Cheek & Zeehandelar, LLP, 252 F.R.D. 387, 388-89 (S.D. Ohio 2008). Plaintiffs moved the district court to certify the litigation as a class action: the class action certification motion sought a Rule 23(b)(2) class for declaratory and injunctive relief, and a Rule 23(b)(3) sub-class for monetary damages. Id., at 389. . Id. The district court granted plaintiffs’ motion to certify the Rule 23(b)(2) class, but denied class action treatment as to the Rule 23(b)(2) sub-class.

Ohio law permits a judgment creditor to garnish property based on an affidavit stating “that the person named in the affidavit as the garnishee may have property, other than personal earnings, of the judgment debtor that is not exempt under” Ohio or federal law. Stewart, at 389. According to the class action, defendants execute such affidavits for the purpose of attaching property without conducting a proper investigation. Defendants, by contrast, testified to procedures they had in place to ensure that the affidavits were accurate, though the person who executed the affidavits “never personally contacted the debtors to determine whether their property or funds were exempt, nor did he contact the debtors’ banks, or conduct debtors’ examinations.” Id., at 389-90. Moreover, defendants testified that they did not being sending out discovery “to ascertain the status of their property or funds” until after the class action lawsuit had been filed, id., at 390.

Certification of Class Actions Class Action Court Decisions Uncategorized

FDCPA Class Action Defense Cases–Gaisser v. Portfolio Recovery Associates: Florida Federal Court Grants Motion To Dismiss Certain Class Action Claims But Denies Motion To Dismiss FDCPA Class Action

Motion to Dismiss FDCPA Class Action Claim Premised on Filing Untimely Debt Collection Lawsuits Fails but Motion to Dismiss State Law Class Action Claims and to Dismiss FDCPA Class Action Claim based on Attorney Fees Sought in Debt Collection Lawsuits were Meritorious Florida Federal Court Holds

Plaintiff filed a class action against Portfolio Recovery Associates (PRA) and certain individuals (PRA’s lawyers) alleging violations of the federal Fair Debt Collection Practices Act (FDCPA) and Florida’s Consumer Collections Practices Act (FCCPA); the class action complaint asserted that in violation of state and federal law, defendants engaged in a pattern and practice of filing lawsuits to collect debts after the statute of limitations had expired for doing so, and that defendants sought a standard amount of attorney fees without supporting documentation and without actually having incurred the stated amount in attorney fees. Gaisser v. Portfolio Recovery Associates, LLC, 571 F.Supp.2d 1273, 1274-75 (S.D. Fla. 2008). According to the class action, “Defendants’ practice of attempting to collect on debts after expiration of the applicable statute of limitations and Defendants’ practice regarding attorney’s fees runs afoul of the FDCPA.” Id., at 1275. More specifically, the class action complaint alleged that “Defendants used false or misleading representations to collect or attempt to collect a debt in violation of 15 U.S.C. § 1692e,” and “used unfair or unconscionable means to collect or attempt to collect a debt in violation of 15 U.S.C. § 1692f.” Id. The class action further alleged that defendants’ conduct violated Florida state law. Id. Defense attorneys moved to dismiss the first amended class action complaint. Id., at 1274. The district court granted the motion in part and denied the motion in part.

Plaintiff incurred credit card debts but was unable to keep up with the required payments. Gaisser, at 1274. The debt was assigned to PRA, who retained counsel to file suit against plaintiff to collect on the debt. Id. The first issue the district court addressed was whether New Hampshire’s three-year statute of limitations applied or Florida’s five-year statute of limitations applied to the debt collection lawsuits filed by defendants. Id., at 1275-76. The Court concluded that New Hampshire law applied, id., at 1276-77, and that defense attorneys failed to establish that the lawsuit – filed against plaintiff four years after the commencement of the statute of limitations – was filed timely, id., at 1277-78. But the district court granted the defense motion to dismiss the class action claims premised on the lawyer’s attorney fees, concluding that the lawyer verified only what a “reasonable fee” would be for the services rendered, not that the amount sought represented his “actual fee.” Id., at 1278. Because defendants did not represent the amount of attorney fees requested was a “sum certain,” and because defendants invited the court to determine the “reasonable fee” to be awarded, the class action claims based on the attorney fee requests failed. Id., at 1277-78.

Class Action Court Decisions FDCPA Class Actions Uncategorized

Labor Law Class Action Lawsuits Again Hold Top Spot Among Weekly Class Action Filings In California State And Federal Courts But Securities Class Action Lawsuits Surge Into Second

To assist class action defense attorneys anticipate the types of class actions against which they will have to defend in California, we provide weekly, unofficial summaries of the legal categories for new class action lawsuits filed in California state and federal courts in the 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.

Class Actions In The News Uncategorized

Class Action Defense Cases—In re Indianapolis Life: Judicial Panel On Multidistrict Litigation (MDL) Grants Defense Motion To Centralize Class Action Litigation In Northern District of Texas

Judicial Panel Grants Defense Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407 in the Northern District of Texas but Excludes two Class Actions from the Scope of its Transfer Order Four class actions – in the District of Arizona, the Southern District of Indiana, the Northern District of Mississippi and the Northern District of Texas – were filed against Indianapolis Life and others alleging In re Indianapolis Life Ins.

Class Action Court Decisions Multidistrict Litigation Uncategorized