Monthly Archives January 2013

In an interesting order, Judge Jackson granted defendant Office Depot’s motion to dismiss the class allegations in a putative class action brought under the TCPA, 42 U.S.C. § 227, alleging the transmission of unsolicited faxes.  Judge Jackson shrugged aside Plaintiff Lindsay Transmission’s protest that the motion to dismiss prior to class discovery was premature, citing Rule 23(c)(1)(A)’s directive to determine the propriety of class certification “at an early practicable time.”   This is of course consistent with the increasing number of courts that have expressed a willingness to dismiss class allegations at an early stage, and the Court may well have been influenced by Office Depot’s affidavit explaining that Lindsay Transmission’s initial nationwide discovery requests would have required more than 2,000 manager hours to interview 1,132 store managers in 1,111 retail stores, a truly expensive fishing expedition. Instead, the District Court mooted the onerous discovery requests by striking the class allegations…

“An ascertainable loss of money or property” is an essential element of a cause of action brought under the Missouri Merchandising Practices Act. But what if something is free and doesn't perform as advertised? In Grawitch v. Charter Communications, Inc., 2013 WL 253534 (E.D. Mo. Jan. 23, 2013), an internet-service provider offered its existing customers a free upgrade: faster internet service ("with download speeds of up to 30 MBPS") at no additional charge.  But to enjoy the faster internet service, customers would need to upgrade their modems (available only from the ISP).  According to plaintiffs, those upgraded modems weren't capable of download speeds of up to 30 MBPS. Plaintiffs brought a class action under the MMPA, alleging a loss of money to Plaintiffs: “specifically, the difference in the cost and value of the service they paid for, and the useable service they received.” Is that an "ascertainable loss" under the…

In Coulter v. Anadarko Petroleum Corp., 2013 WL 135664 (Kan, Jan. 11, 2013), the Kansas Supreme Court closed the book on nearly fifteen years of oil and gas lease class litigation and provided some helpful guidance on how Kansas courts will evaluate the adequacy of class counsel and the fairness and adequacy of class action settlements.  This class action was brought in 1998 by owners of mineral interests in lands leased by APC principally, and alleged that APC had wrongfully allocated production and marketing costs against royalty payments in violation its contractual obligation to produce gas at its own expense.  After a bench trial and submission of proposed findings of fact and conclusions of law by both sides in 2002, the case sat with no ruling for years.  In 2008, after moving to recuse the judge and receiving no ruling on that motion, the parties took matter into their own…

In an opinion paralleling that in Anadarko, another lengthy class action came to (nearly) rest on the other side of the border in Doyle v. Fluor Corp., 2013 WL 150807 (E.D. Mo. Jan. 15, 2013).  That opinion marks the resolution of the protracted Doe Run smelter property damage litigation, and involved the claims of some 700 surrounding current and former property owners whose properties were contaminated by elevated levels of lead.  After a decade of litigation, the case reached resolution in 2012 whereby the class agreed to release all property-related claims in exchange for $55,000,000.00.  On the eve of final approval, a group of objectors composed of twenty-four former property owners and four current property owners moved to intervene and challenge the settlement, asserting that the notice scheme was inadequate and the allocation plan unfair.  The trial court denied their objections and approved the class settlement. On appeal, Judge Ahrens,…

There are many ways to give notice to class members, but the notice must be "the best notice that is practicable under the circumstances."  Fed. R. Civ. P. 23(c)(2)(B).  If you can identify class members through reasonable effort, you must give them individual notice.  If you can't, then publication notice may be an option. No matter the method of notice chosen, to pass muster under the Due Process Clause, the method must be  "reasonably certain" to inform the class members.  Mullane v. Cent. Hanover Back & Trust Co., 339 Us.S. 306, 315 (1950). Which is why Judge Vratil rejected Plaintiffs' class-notice plan, which would have used an exclusively web-based notice (Internet banner ads, to be precise) to give notice to class members in states where at least 75 percent of the target population has Internet access according the 2012 U.S. Census.  In re Motor Fuel Temperature Sales Practices Litigation (MDL…

This decision is a useful reminder of how to control potentially expensive and protracted appeals of class settlements by class members who are either genuinely disgruntled or seeking additional leverage for financial reasons.  In this case, the settling defendant built in a provision requiring class members who wished to appeal the class settlement to put their money where their mouth was in terms of a robust appeal bond: Paragraph 5.3 of the Settlement Agreement approved by the court provides: Any Class Member wishing to remain a Class Member, but objecting to any part of the Settlement can do so only as set forth in the Class Notice attached as Exhibit “C”. Because any appeal by an objecting Class Member would delay the payment under the Settlement, each Class Member that appeals agrees to put up a cash bond to be set by the district court sufficient to reimburse Class Counsel's…

This term the Supreme Court granted cert to Genesis HealthCare Corp. v. Symczyk, No. 11-1059, an appeal from the Third Circuit decision, 656 F.3d 189 (3d Cir. 2011).  At issue is whether a defendant can moot a putative Fair Labor Standards Act (“FSLA”) collective action by "picking off" the named plaintiff through a Rule 68 offer of judgment before certification.  While the Court's decision will no doubt impact the future viability of wage and hour collective actions, it may also have the potential to affect Rule 23 class actions as well. Briefly, the plaintiff, Laura Symczyk, alleged that her employer, Genesis, improperly deducted her pay for meal breaks even though she often did not take them.  After answering, Genesis proffered a Rule 68 offer of judgment of “$7,500.00 in alleged unpaid wages, plus attorneys’ fees, costs and expenses.”  After the plaintiff refused the offer, Genesis moved to dismiss, arguing that…

The U.S. Court of Appeals for the Eighth Circuit has enforced an arbitration agreement requiring an employee to arbitrate – on a non-class basis – her wage claims under the Fair Labor Standards Act.  This decision is in line with the decisions of several other federal courts of appeal to consider whether the FLSA’s collective action provisions provide employees a federal right that cannot be waived in the context of an arbitration agreement. In Owen v. Bristol Care, Inc., the Eighth Circuit held that an employee can contractually waive any such “right” to collectively pursue wage claims in court proceedings.  The court based its decision on the strong federal policy favoring arbitration, embodied in the Federal Arbitration Act and highlighted in numerous pro-arbitration decisions from the U.S. Supreme Court and other courts.  The Eighth Circuit distinguished a recent NLRB decision refusing to enforce an arbitration agreement, noting that the NLRB’s…

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