Articles Posted in Class-Action

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Based on our research and experience, the best defenses to a class action generally revolve around the requirements of typicality and adequacy of the class representative (Danis v. USN Communications, Inc., 189 F.R.D. 391 (1999)). The presence of even an arguable defense peculiar to the named plaintiff or a small subset of the plaintiff class may destroy the required typicality of the class as well as bring into question the adequacy of the named plaintiff’s representation. This fear arises from the possibility that the named plaintiff could become distracted by the presence of an individual defense, which could compromise the representation of the rest of the class (Al Haj v. Pfizer Inc., — F.R.D. —- (2020)), (Lipton v. Chattem, Inc., 289 F.R.D. 456 (2013)), (CE Design Ltd. v. King Architectural Metals, Inc., 637 F.3d 721 (2011)).

A defense unique to a proposed class representative does not need to be a sure bet to defeat the adequacy required for class certification; it only needs to be arguable and substantial (Al Haj v. Pfizer Inc., — F.R.D. —- (2020)). Similarly, defenses that are specific to the named representative may defeat the requirements of typicality or adequacy of the representative (Danis v. USN Communications, Inc., 189 F.R.D. 391 (1999)). However, these defenses need to be “unique, arguable and likely to usurp a significant portion of the litigant’s time and energy” (Danis v. USN Communications, Inc., 189 F.R.D. 391 (1999)).

It’s important to note that the assertion of individual defenses does not necessarily defeat a plaintiff’s ability to represent a class adequately (P.J.’s Concrete Pumping Service, Inc. v. Nextel West Corp., 345 Ill.App.3d 992 (2004)), (Walczak v. Onyx Acceptance Corp., 365 Ill.App.3d 664 (2006)). A class action, in which a defendant is alleged to have acted wrongfully in the same basic manner as to the entire class, is not necessarily defeated merely because certain defenses may be urged against individual class members (735 ILCS 5/2-801).

Moreover, defenses that are unique to a named plaintiff are relevant to the inquiry into whether plaintiff’s claims are typical but are not necessarily dispositive of the issue (Sebo v. Rubenstein, 188 F.R.D. 310 (1999)). In many instances when a unique defense exists a class is defeated but the court is not required to deny certification for speculative reasons; the certification decision always remains within the sound discretion of the court (Danis v. USN Communications, Inc., 189 F.R.D. 391 (1999)).

Lastly, it’s worth noting that while the merits are not typically before the appellate court when reviewing the district court’s certification of the class, the claim of the class representative may be subject to a defense that makes it an inappropriate representative of the class because other class members may not be subject to the same defense, or perhaps to any defense (CE Design Ltd. v. King Architectural Metals, Inc., 637 F.3d 721 (2011)).

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When facing a class action lawsuit, the stakes are incredibly high. The complexity of these cases requires a legal team with specialized expertise and a track record of success. Lubin Austermuehle stands out as a premier choice for several compelling reasons:

Extensive Experience in Class Action Defense

Lubin Austermuehle’s legal team has extensive experience in defending class action lawsuits across various industries. Our attorneys are well-versed in the intricate procedural and substantive aspects of class action law, ensuring that every angle of your case is meticulously analyzed and strategically addressed.

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In a world where consumer lawsuits and class actions seem to be on the rise, businesses are constantly seeking effective strategies to defend themselves against potential legal challenges. One strategy that often flies under the radar but can be a game-changer is product recalls. While recalls are typically viewed as an admission of fault, they can actually serve as a powerful defense strategy, potentially short-circuiting class action lawsuits before they gain traction. In this blog, we’ll explore how recalls can be a great defense strategy for businesses.

1. Swift Action and Responsibility

One of the primary reasons recalls can be an effective defense strategy is the swift action and responsibility they demonstrate. When a company identifies a potential safety issue with one of its products and voluntarily recalls it, they are taking proactive steps to protect their consumers. This responsible and proactive approach can help build goodwill with customers and regulators.

By recalling a product quickly, a company can show that they prioritize safety over profit, which can make it challenging for plaintiffs to argue that the company was negligent or intentionally harmed consumers. Instead of facing a drawn-out legal battle, the company can focus on rectifying the issue and rebuilding trust.

2. Mitigation of Damages

Recalls also allow companies to mitigate potential damages, which can be a significant factor in deterring class action lawsuits. When a company recalls a product, they can take it off the market, preventing further harm to consumers and limiting potential damages. This swift action can reduce the overall number of affected consumers and the associated financial impact.

In a class action lawsuit, plaintiffs often seek damages for medical bills, lost wages, pain and suffering, and other related costs. By recalling the product early, a company can argue that they took reasonable steps to prevent these damages from occurring or escalating. Continue reading ›

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The Telephone Consumer Protection Act (TCPA) imposes liability for calling or texting cellular phone numbers using an Automatic Telephone Dialing System (ATDS) without sufficient prior express consent. The TCPA defines an ATDS as “equipment which has the capacity (A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers.” The TCPA creates a private cause of action and allows a plaintiff to recover statutory penalties of $500 per call or text in violation, or up to $1,500 for a knowing or willful violation. These statutory penalties have made the TCPA a useful tool for class-action plaintiffs’ attorneys seeking to hold companies liable for calls and texts over a four year statute of limitations period.

The Ninth Circuit has traditionally taken an expansive approach when defining what does and doesn’t qualify as an ATDS, extending the definition to virtually any kind of auto-dialer. Last year however, in Facebook, Inc. v. Duguid, the U.S. Supreme Court struck down the Ninth Circuit’s expansive approach to defining an ATDS, generally holding that an auto-dialer is not an ATDS if the numbers being dialed are from an existing list of specific numbers, such as from a database. Since Duguid, many TCPA defendants have argued that the definition of an ATDS requires that the random or sequential number generator be used to generate telephone numbers. Many TCPA defense attorneys also remained concerned that more liberal circuits, such as the Ninth and Second Circuits, might undermine Duguid’s conservative, defense-friendly ruling.

TCPA plaintiffs’ attorneys seized on a particular quirk in footnote 7 of the Duguid opinion where the Supreme Court addressed an argument concerning the overlapping of the “storing and producing functions” of an ATDS. In addressing a situation where an autodialer might not both store and produce numbers, the Supreme Court wrote: “For instance, an autodialer might use a random number generator to determine the order in which to pick phone numbers from a pre-produced list. It would then store those numbers to be dialed at a later time.” Plaintiffs’ attorneys have argued that companies that maintain customer contact lists and select which customers to contact on a given day using a random or sequential number generator are therefore using an ATDS. Continue reading ›

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The U.S. Food and Drug Administration recently published a proposed rule that, if implemented, would update the labeling standards that food products must meet in order to be labeled as “healthy.” The FDA first established a definition for “healthy” in 1994, and at that time nutrition science and federal dietary guidance focused more on the individual nutrients contained in food. According to the FDA, the proposed rule would “align the definition of ‘healthy’ with current nutrition science, the updated Nutrition Facts label and the current Dietary Guidelines for Americans,” with the goal of assisting consumers to increase their consumption of under-consumed dietary components.

The proposed rule would achieve this goal by requiring “healthy” foods to contain a minimum quantity of at least one of the specified food groups or subgroups recommended by the Dietary Guidelines such as fruits and vegetables, while limiting over-consumed ingredients that may lead to negative health consequences such as sodium or added sugars. The FDA’s proposed framework for the updated definition of “healthy” focuses on ensuring that foods labeled as healthy can qualify to bear the title by helping consumers to build a diet consistent with current dietary recommendations. Continue reading ›

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Facing a recently filed putative class action lawsuit over the labeling and marketing of its toddler formula, baby formula manufacturer Gerber has asked a federal judge in Chicago to dismiss the suit arguing that reasonable parents buying its toddler formula couldn’t possibly be misled by the claims on its Good Start Grow products. The motion comes on the heels of the dismissal of a second class action lawsuit involving Gerber’s formula by a Virginia federal judge earlier in the month.

In her complaint, plaintiff Melissa Garza alleges that Gerber makes a toddler formula that is marketed as nutritional, but which actually contains added sugars and less protein than cow’s milk. Garza alleges that Gerber’s Good Start GentlePro Infant Formula and Good Start Grow Toddler Drink are marketed nearly identically without disclosing that the toddler formula has added sugar, less protein and more carbohydrates than whole cow’s milk.

The complaint alleges that Gerber’s failure to adequately distinguish the two products and disclose that its toddler formula is inconsistent with expert advice constitute violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, the consumer fraud acts of other states and the federal Magnuson Moss Warranty Act and has unjustly enriched Gerber. Garza seeks to represent herself and a class of individuals in Illinois, Iowa, Arkansas, Wyoming, North Dakota, and Utah who purchased Gerber’s toddler formula.

The toddler formula, which the complaint refers to as a “transition formula” (a term Gerber takes issue with in its motion to dismiss), contains nearly the same ingredients as Gerber’s infant formula and is fortified with vitamins D and E as well as iron. However, Garza alleges that a global consensus of pediatric health organizations, including the American Academy of Pediatrics (AAP) Committee on Nutrition and the relevant Sub-Committee of the World Health Organization (WHO) have advised that transition formula is not recommended and that toddlers can meet all nutritional needs from whole cow’s milk, water and healthy foods. Continue reading ›

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In today’s society, license agreements are everywhere. With the advent of Software as a Service (SaaS) and web-based services, click-wrap or clickthrough agreements—agreements where the licensee agrees to the terms of the license agreement by clicking a button or ticking a box—are commonplace. The software and online services industries depend on such agreements. Recently however, a federal district court judge out of the Northern District of California issued a potentially industry-shaking ruling invalidating amendments to such click-wrap agreements unless a user is required to manifest assent to such amendments through something more than mere continued use of the service.

The defendant in the suit is Dropbox and the plaintiff is a user of Dropbox’s online file storage service. The plaintiff, who filed the suit pro se, alleged that he suffered injury as a result of a 2012 data breach which the plaintiff alleged involved the compromise of his Dropbox account. In response to the complaint, Dropbox moved to compel arbitration arguing that its amended terms of service (TOS) required the claim to be resolved through binding arbitration instead of a lawsuit. Continue reading ›

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Approximately 38,000 consumer lawsuits have been filed against Johnson & Johnson for allegedly including asbestos in their baby powder, which allegedly caused ovarian cancer and mesothelioma. Executives at Johnson & Johnson allegedly knew about the risks of asbestos for decades and still included it in their baby powder. Those same executives deny the allegations that their product is contaminated or that it caused anyone to get sick.

The company finally pulled its baby powder off the shelves in 2020, but only because bad publicity had hurt sales, according to the giant pharmaceutical company.

The results of the lawsuits against Johnson & Johnson have been a mixed bag. The company has emerged victorious in some of those lawsuits but has been ordered to pay billions of dollars to plaintiffs in other lawsuits.

People with ovarian cancer or mesothelioma are too sick to work and need caregivers to tend to their basic needs, which means either a family member can’t work, or they need to hire a full-time caregiver. Those expenses could be covered by a settlement in the lawsuit against Johnson & Johnson, but the company, which is valued at $400 billion, has found a legal loophole to avoid facing those lawsuits. Continue reading ›

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In a recent decision, the U.S. Court of Appeals for the Eleventh Circuit revived a class action lawsuit filed against Avior Airlines accusing the airline of forcing passengers to pay undisclosed fees in order to board flights from Miami to Venezuela. In its decision, the appeals court ruled that the class action suit could proceed and that the district court erred when it found the claims preempted by the Airline Deregulation Act.

Plaintiffs Roberto Hung Cavalieri and Sergio Enrique Isea purchased tickets for flights operated by the defendant Avior Airlines. According to the plaintiffs’ compliant, the plaintiffs purchased tickets from Miami to Venezuela. The itineraries and receipts for the tickets indicated that the price “included taxes and fees.” However, on the day of their flights, the plaintiffs alleged that the airline forced passengers to pay an additional $80 “Exit Fee” before they were permitted to board their departing flights to Venezuela.

The plaintiffs filed suit against the airline alleging that the undisclosed fee constituted a breach of their contracts with the airline, formed when they purchased their tickets. The plaintiffs sought to represent a national class defined as “all persons that Avior charged an Exit Fee, from five years prior to the filing of the initial complaint through the earlier of: (i) the date, if any, Avior changes its contract to expressly include Exit Fees; and (ii) the date of class certification.”

The putative class action got off to a rough start, however. The district court dismissed the lawsuit finding that the Airline Deregulation Act preempted the breach of contract claims. According to the district court, the Act preempts all claims related to related to prices, routes, and services and the plaintiffs’ claims fell into the purview of the Act because it related to pricing.

The plaintiffs appealed the dismissal to the Eleventh Circuit, which disagreed with the district court on the issue of preemption. After examining the issue of jurisdiction and satisfying itself that it had jurisdiction to hear the appeal, the Court recounted the history of the Act. As the Court explained, Congress passed the Airline Deregulation Act in 1978 to eliminate regulation of air carrier prices. The Act includes a preemption provision, providing that “a State, political subdivision of a State, or political authority of at least 2 States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier.” Continue reading ›

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Many people are familiar with insurance companies denying claims for a variety of reasons. Every dollar they use to repair or replace property is a dollar they can’t categorize as a profit or distribute to their executives as a bonus, so it’s common for insurance companies to try to find ways out of paying for claims. What is less common is to hear a claims adjuster say they don’t believe your story because your area is supposedly rife with fraud. That’s exactly what Darryl Williams, a former property owner on the South Side of Chicago, heard when he filed a claim for damage done to one of his apartment buildings when a pipe burst.

Williams is Black and the South Side of Chicago is a predominantly Black neighborhood, so since State Farm had no evidence of fraud, Williams felt he was being discriminated against as a Black man. He sued State Farm in Illinois for racial discrimination in 2019 and his attorney asked for the lawsuit to be tried as a class-action lawsuit, but the judge denied the request, saying the attorney’s analysis was not sufficient evidence that others had had experiences like Williams’s. Then Carla Campbell-Jackson, a former employee of State Farm, reached out to back up Williams’s allegations.

Campbell-Jackson had worked for State Farm for almost 30 years and loved her job until she was promoted to the special investigations unit (SIU), where claims adjusters sent potentially fraudulent claims to be more closely reviewed. Shortly after her promotion, Campbell-Jackson realized State Farm executives wanted SIU employees to meet with claims adjusters to encourage them to send more claims to be investigated by the SIU. The goal, according to Campbell-Jackson, was to deny as many claims as possible. She alleges investigators were told at weekly meetings to focus on claims from urban areas that were supposedly at a high risk for fraud, which would allegedly make those claims easier to deny. Campbell-Jackson alleges they would even circulate lists of supposedly “high-risk” areas. In her testimony, she said it was a way to deny millions of dollars in payments to African Americans and other minorities. Continue reading ›

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