Articles Posted in Class-Action

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In an age where people are paying and utilizing services online, a certain standard which is regulated by law and expected by clientele needs to be met.  That is why when a man from Illinois has decided to sue an online service for paying monthly fees for a service which he is claiming had multiple inactive or dead profile accounts.

In the complaint which is filed in a Federal Court, the service repeatedly asked him pay between $9.99 and $19.99 per month to connect with users who “liked” his profile after the creation of a free account, upon which, he immediately began receiving messages from other users who had supposedly liked his profile. To learn the identities of those who had liked his account, however, the plaintiff was prompted to pay for a premium, or “A-List,” service. The plaintiff alleges that right after the payment of $44.99, he knew something was amiss. Shortly thereafter, upon reviewing the profiles of individuals whose identities were previously hidden, the plaintiff allegedly discovered that most if not all of these people were associated with inactive or ‘dead’ accounts, making interaction or dating impossible.

It is alleged that the actions constitute a breach of contract and violate both the Illinois Dating Referral Services Act and the Illinois Consumer Fraud and Deceptive Business Practices Act with potential to seek class-action status. Continue reading ›

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Shortly after having paid a total of more than $300 million in fines and settlement payments for allegedly opening fake accounts for its customers without their knowledge or consent, Wells Fargo is once again back in the spotlight for allegations of fraud.

This time the allegations are in regards to the bank’s auto lending business, which allegedly signed up and charged customers for car insurance they may or may not have needed or been made aware of. According to the class action lawsuit, most of the approximately 570,000 customers involved were not looking for a car loan from Wells Fargo, but got one anyway after they had chosen an automobile.

Wells Fargo required borrowers to maintain comprehensive car insurance, like almost any other auto loan company. Unlike other auto loan companies, Wells Fargo allegedly bought insurance for its customers who did not have comprehensive insurance, then charged them for it. Wells Fargo even admitted to buying insurance for customers who already had coverage.

National General has also been named as a defendant in the lawsuit, as it is the company from which Wells Fargo purchased insurance on behalf of the customers it deemed were underinsured (whether they were or not). The bank then charged their customers for that insurance, regardless of whether those customers could afford the insurance Wells Fargo had bought for them.

Many of the customers who were forced to pay for auto insurance they could not afford fell behind on their payments, to the point where some were forced to default on their loans, resulting in the repossession of their vehicles. Continue reading ›

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The Seventh Circuit has again rejected a pick-off attempt in a class action overturning a dismissal that approved use of that tactic.

Just because someone offers to make a payment to settle a legal dispute does not mean the payee is required to accept the payment. Nor does the offer of payment (or deposit made to the court) negate the existence of the legal dispute. Nevertheless, that’s exactly what Bisco Inc. tried to claim after Fulton Dental, LLC filed a putative class action lawsuit against the dental company.

Fulton sued Bisco for allegedly violating the Telephone Consumer Protection Act (TCPA) by sending unsolicited fax messages about dental products. Fulton sued on behalf of itself and all those similarly situated who received unsolicited fax messages from Bisco (for which Fulton was therefore made to pay). But before Fulton had a chance to file a motion to certify its class of plaintiffs, Bisco offered to pay Fulton about $3,000 in order to settle the dispute. Fulton refused, but Bisco made a deposit to the court of $3,600 and claimed that settled the whole matter.

The Seventh Circuit Court disagreed, going off the Supreme Court’s 2016 in Campbell-Ewald, in which the Supreme Court rejected the assertion that an offer to pay the plaintiff’s damages in full did not render the class action lawsuit moot under Rule 68 of the Federal Rules of Civil Procedure.

However, in its written opinion, the Supreme Court did note that, by making the ruling in this particular case, the Court was not trying to rule in any other legal disputes of a similar nature. Bisco took that to mean the deposit it made to the Seventh Circuit Court of Appeals was still a valid method of ending its legal dispute with Fulton Dental. Continue reading ›

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The Seventh Circuit Court of Appeals found the owner of the Akira retail chain didn’t violate federal and state law when it sent promotional text messages to customers who had provided their phone numbers. Nicole B. filed a class‐action lawsuit against Chicago‐based Bijora, Inc., which operates the Akira clothing stores, alleging that Akira’s practice of sending promotional text messages to customers violated the federal Telephone Consumer Protection Act and the Illinois Consumer Fraud and Deceptive Business Practices Act.

Akira, which has over 20 stores in the Chicagoland area, used third-party text‐messaging software to inform its customers of promotions, discounts, and in‐store special events. Customers could opt in to its “Text Club” by providing their cell phone numbers to Akira representatives inside stores, texting “Akira” to a number posted in stores, or filling out an “Opt In Card.”

Akira collected cell numbers for over 20,000 customers and between 2009 and 2011, sent some 60 text messages advertising store promotions, parties, events, contests, sales, and giveaways to those customers, including Nicole B.

Nicole alleged that Akira violated TCPA’s prohibition against using an automatic telephone dialing system to make calls without the prior express consent of the recipient. The suit sought $1,500 for each of the 1.2 million texts sent, for a total of over $1.8 billion in statutory damages.

Summary judgment was granted on the trial court’s determination that Akira and its software provider had not used an autodialer to send the messages because human involvement was required in the platform’s text message transmission process. Continue reading ›

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We’re all careful to try to avoid the dreaded overdraft fee. One wrong calculation and we could find ourselves facing hefty fines that just keep adding up until our next payday.

But the banks have rigged the system against us. They have decided to rearrange the order of our transactions so that our larger withdrawals are processed first, followed by smaller transactions, which then leave us with a negative balance in our checking account. When we do get paid again, the deposit gets applied to the overdraft fee before we can access the rest, meaning the bank is essentially paying itself first with our money.

To call overdraft fees counterproductive is an understatement. In many cases they lead to an endless cycle of debt, and unsurprisingly, it’s usually the people with the lowest income who are made to pay the vast majority of overdraft fees.

To make a bad situation worse, some banks (like Wells Fargo) refuse to settle the dispute in court. Instead, they included an arbitration clause in their customer contract that requires their clients to settle all legal disputes in arbitration – a system that was set up for (and benefits) businesses, rather than individuals.

The Consumer Financial Protection Bureau (CFPB) looked into the benefits and drawbacks for individuals trying to settle their disputes with large businesses in arbitration. The private process consistently benefited big businesses, despite business advocates claiming arbitration provides more benefits to individuals than the court system. The CFPB’s study found that most individuals simply gave up, rather than pursue the dispute in arbitration, especially in cases of small claim amounts, when the potential reward is significantly less than the costs of pursuing arbitration. Even when the individuals did succeed in obtaining an award (less than 10% of those filed) the relief provided was less than 15% of the value of their claim.

Because arbitration is not designed to handle class actions, individuals are forced to duke it out against big businesses on their own – hence the tendency to abandon small claims, which they could pursue if they were give then chance to combine their claims with other plaintiffs with similar grievances. Arbitration is also private, which means even if an individual does manage to beat the odds and obtain an award, other people in the same situation have no way of knowing about it, which puts another layer of restriction on the individuals’ opportunities for obtaining an award, especially if they’re not even aware they have a valid claim.

The CFPB is trying to put a stop to this by implementing a new rule banning banks from forcing their customers into arbitration agreements. It has the support of several U.S. Senators who got together to publish a letter of concern regarding banks’ arbitration agreements with their customers.

While other banks have agreed to settle their customers’ claims from overdraft fees, Wells Fargo continues to hold out against a class of consumers trying to force the bank to resolve the dispute in court, rather than arbitration. Courts have consistently ruled against Wells Fargo, but the bank is getting ready to bring their case before the 11th Circuit Court of Appeals, hoping its judges might be more sympathetic to its case. If they take it all the way to the Supreme Court, we’ll get a final decision on the matter. Continue reading ›

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Many people have long given up the hope of having any privacy when we’re online. From cookies to tracking search results to targeted advertising, it’s pretty widely accepted that the internet is not a private place, although many users continue to insist internet companies stop tracking our every move.

Back in 2010, Facebook was storing digital cookies on consumers’ internet browsers and using those cookies to track the users’ visits to other sites that contained Facebook’s “like” button (which allows viewers to post a like of the article or website to their Facebook account without leaving the page). The tracking continued even after users had logged out of their Facebook accounts.

Facebook had promised consumers it would delete the cookies, but the company continued to access information on the cookies until 2011, when an independent researcher brought the issue to the attention of the public. At that point, a class of plaintiffs sued Facebook for allegedly violating federal and California state privacy laws by using the cookies. The time period for the lawsuit goes from April 2010, when the company said it had stopped using cookies, to September 2011, when the tech giant actually stopped using the cookies after it had been outed.

Although a lot can change in five years, the plaintiffs are still pursuing their claims against Facebook, having revised their allegations after the judge dismissed their original claims in the fall of 2015. Continue reading ›

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Imagine going into a store to buy something. A few months later, without having returned to the store, you find out the store bought one of their products on your behalf, without bothering to tell you about it or get your permission. That’s essentially what a class of consumers are alleging Wells Fargo did for more than a decade while its aggressive sales team were encouraged to do everything in their power to meet their quotas.

According to a recent class action consumer lawsuit, Wells Fargo allegedly created more than 2 million credit cards, lines of credit, checking accounts and savings accounts, without first getting approval from the customers for whom they were opening the accounts. Not only were the customers made to pay the fees to open these accounts they never wanted, but some of them suffered damage to their credit history as a result of credit cards and lines of credit that were opened for them and then never used.

After a class of consumers filed a class action lawsuit seeking claims against the bank for the sham accounts, Wells Fargo offered to settle the lawsuit for $110 million, but later raised their offer to $142 million after an investigation found that the practice of opening these sham accounts went back as far as 2002. That revelation prompted the plaintiffs’ attorneys to up their estimate of sham accounts from 2.1 million to 3.5 million, although they may not see a similar increase in the number of plaintiffs, as some plaintiffs allegedly had multiple sham accounts opened in their name.

The settlement amount is in addition to the $185 million Wells Fargo has already been made to pay to regulators after their practice of opening sham accounts on behalf of unsuspecting (and unwilling) customers was revealed. The resignation of the bank’s CEO at the time, John Stumpf, was another result of the scandal. Continue reading ›

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The Federal Arbitration Act was created in 1925 to provide a faster, more efficient method for businesses of equal bargaining power to settle disputes between themselves without crowding the courts. The part about the parties needing to be of equal bargaining power is vital, especially since arbitration is private and was not designed to handle class-action lawsuits.

Unfortunately for consumers, arbitration clauses have started appearing in the fine print of their contracts with almost every provider: banks, websites, merchants, car dealers, credit card companies, even their employers. This means that every dispute someone has with a company has to be settled by arbitration, which is private, offers no written opinion on the matter (i.e. no explanation for the ruling), and is often biased in favor of the large companies that bring in lots of business for the arbitrator (although there are a few arbitration companies that are known for their fairness).

The reality is that individuals very rarely, if ever, have the same bargaining power as giant corporations with a team of attorneys at their disposal. In particular, arbitration agreements cripple individuals by preventing them from combining their claims into class actions. Since most individuals have small claims against corporations, class actions are the only method they have for justifying the costs of the lawsuit. If your bank charged you $100 dollars in illegal fees and filing a lawsuit costs $2,000 to hire an attorney and pay for court costs, no reasonable person is going to pursue the matter. They’d rather let it drop, which lets the bank continue to illegally collect thousands of dollars from hundreds of customers who don’t have any way to redress the wrong. Continue reading ›

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The Equal Employment Opportunity Commission just proved it is more interested in fostering real change than fining large corporations.

Sterling Jewelers just settled the lawsuit filed by the EEOC, alleging it discriminates against its female employees, without admitting to having done anything wrong or paying any money to the class of plaintiffs. Instead, Sterling Jewelers (which owns Kay Jewelers and Jared the Galleria of Jewelry, among others) has agreed to hire an independent employment expert who will review employment and promotion practices within the jewelry company.

But Sterling still has to deal with a separate class-action arbitration case in which female employees of the company are accusing Sterling of regularly paying women less than their male counterparts, overlooking women for promotions and other opportunities for advancement, and fostering a work culture in which sexual harassment was the norm.

Signet (which is Sterling’s parent company) is continuing to fight the arbitration claims and said it has already investigated the allegations of sexual harassment on its own without finding anything to back up the allegations. Continue reading ›

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As more and more of our personal information ends up online (either through our own actions or someone else’s) we must all be increasingly vigilant about taking the necessary steps to ensure our privacy from hackers. Businesses and website hosts need to be especially careful about protecting themselves from liability in the event of a data breach.

Class action lawsuits claiming damages against businesses that allegedly did not take the proper measures to protect against security breaches have been popping up with increasing frequency all over the country, but depending on the case, proving actual damages can be easier said than done.

Most, if not all, banks and credit card companies offer identity theft protection – for a fee. They’ll cover the costs of any unverified charges if your information gets stolen, but only if you pay them a monthly fee. The fee is usually around $5/month, but even that can be prohibitive for low-income consumers. As a result, most plaintiffs suing as a result of a data breach at least sue for the costs of purchasing identity theft protection. Continue reading ›

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