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The cost of everything goes up with inflation and insurance is no different. As the value of our things increases with time, it makes sense that people would want sufficient coverage for all of their belongings. This can become an issue though, when insurance companies insist on raising the limits on a plan (and thus raising the premiums) to levels that are much higher than the property can possibly be worth. Such is allegedly the case in a recent class action lawsuit against State Auto.

According to the complaint, the named plaintiffs, Mark and Andrea Schumacher, bought their home in 2001 for $234,000. They claim that they have made no improvements to the home since then, other than normal maintenance, and that its market value remains about the same. As evidence to support this assertion, the plaintiffs pointed out that the builder from whom they bought their home continues to construct homes in their neighborhood that are similar to the ones that they own, and sell them at a comparable price.

Despite that, State Auto, which has been insuring the Schumachers for years, allegedly increased their policy limit over the years until it stood at more than $500,000 as of 2013. According to the Schumachers, that is much more than what it would cost them to rebuild or replace their home, though it is important to note that there are two different ways of looking at that cost: 1) rebuilding from the ground up; and  2) buying a similar, older home. The cost of these two options can vary dramatically, depending on the market, and some people have a strong preference to buy insurance for one over the other. Continue reading ›

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The U.S. Department of Labor (DOL) is responsible for maintaining safe and fair working conditions for all employees working in the United States. One of the main responsibilities that the DOL has is educating both employers and workers of the rights provided to employees under laws such as the federal Fair Labor Standards Act (FLSA). If a worker believes that her rights as an employee are being violated, she can choose to report her employer to the DOL, rather than filing a lawsuit herself. The DOL is not required to investigate every report of labor violations that it receives. In the event that the DOL chooses not to pursue a case, the employee then has the option of filing a lawsuit.

After investigating a case of alleged labor law violations, the DOL is capable of filing a lawsuit against an employer on behalf of a worker or group of workers, but a more desirable solution is for the department to reach a compliance agreement with the employer. In a compliance agreement, the employer pays damages and back wages (depending on the violations) to the wronged employees, but does not have to pay legal fees. In a court case, the defendant would end up paying for its own legal fees, as well as the legal fees of the plaintiff, if the plaintiff prevailed in the case or if the parties settled outside of court.

A recent example of a compliance agreement that the DOL reached involved the social media company, LinkedIn, which allegedly failed to properly pay its employees when they worked overtime. Under the FLSA, any time an hourly, nonexempt employee works more than eight hours a day or forty hours a week, that employee is entitled to one and one-half times her normal hourly rate for all overtime worked. Continue reading ›

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Whenever there are large loans, there are bound to be targets for debt settlement companies. These are companies that tell borrowers that they will negotiate lower monthly fees for the borrower in exchange for a hefty upfront fee. They convince borrowers to pay them hundreds, if not thousands, of dollars, then they leave the borrowers with the same debt they had to begin with. One such company, Broadsword Student Advantage of Carrollton, Texas, has a radio advertisement which claims “Your entire student loan can be forgiven.” In the past, these fraudulent companies targeted those with large credit card debt or mortgage loans. The recent economic downturn left those who owed more on their property than it was worth as prime targets for those companies, but now they have a new group of targets.

The amount that Americans currently owe in student loans has exceeded $1 trillion, and to make matters worse, a record number of college graduates entered the workforce just as the economy was taking a nosedive, resulting in high unemployment and underemployment rates. More than half of recent graduates are either unemployed or are working low-paying jobs that don’t require the expensive college degrees that they are still struggling to pay off. An estimated seven million Americans have already defaulted on a total of $100 billion in loans, with tens of thousands of more borrowers defaulting each month.

Illinois is now expected to become the first state to bring legal action against debt settlement companies in connection with student loans. The action consists of two separate lawsuits, one against Broadsword Student Advantage and one against First American Tax Defense, alleging that both companies convinced vulnerable borrowers to pay hundreds of dollars for services that the companies never provided. In the case of Broadsword, the company allegedly continued to charge borrowers $49.99 each month after they had paid an initial fee. Continue reading ›

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The landmark decision not to certify a class of plaintiffs in Wal-Mart Stores, Inc. v. Dukes has made it increasingly difficult for classes of plaintiffs to achieve certification. This is largely a result of the fact that the court in Wal-Mart determined that the class failed to meet the commonality requirement necessary for class certification. Courts all across the nation have been refusing certification to classes of plaintiffs that don’t have identical claims. According to the Seventh Circuit Court of Appeals, though, the reasoning behind refusal of class certification in Wal-Mart was much narrower than courts have been interpreting it.

IKO Roofing Shingle Products is currently facing a class action lawsuit from Debra Zanetti, which alleges that IKO’s organic asphalt roofing shingles were defective. According to the lawsuit, which Zanetti filed on behalf of all proposed class members, IKO’s shingles allegedly do not meet an industry standard known as ASTM D225. Compliance with this standard is commonly determined using a testing protocol known as ASTM D228. The lawsuit, which was initially filed in district court in Illinois, is seeking certification of a class of plaintiffs consisting of all consumers who purchased organic asphalt roofing tiles from IKO since 1979. The district court denied the class certification and the plaintiffs appealed the decision to the Seventh Circuit Court of Appeals.

The district court refused to certify the class on the basis of commonality. The district court determined that, per the prior decision made in Wal-Mart, it could not certify a class of plaintiffs without identical claims. The appellate court disagreed, though, pointing out that Wal-Mart failed to meet the commonality requirement for class certification based on the fact that the treatment of employees under different managers was too dissimilar. Since that is not the case here, the court concluded that the district court had erred in refusing class certification on the basis of commonality. Continue reading ›

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The fate of the Los Angeles Clippers has been unsure ever since the owner, Donald Sterling, made headlines with some racist remarks he made that were recorded and released to the media. On the tape, Sterling is heard deriding his girlfriend, V. Stiviano, for having her pitcture taken with black people and saying that he did not want them brought to Clippers games.

Although Sterling has asked forgiveness for what he said, claiming that they were nothing more than emotional remarks made in the heat of a “lovers’ quarrel”, the public has been unforgiving. The NBA responded by banning Sterling from the association for life, a move which was followed by Sterling filing a lawsuit against the NBA for allegedly violating his civil rights.

Since the incident, Sterling’s estranged wife, Shelly Sterling, has entered into negotiations to sell the Clippers to a less controversial owner. She has agreed to sell the team for $2 billion to Steve Ballmer, the CEO of Microsoft, but the question remains whether Shelly has the authority to sell the team. Initially, the dispute centered around the questionable mental state of the 80-year-old Donald. Two doctors examined Donald and found him to be mentally incapacitated. Continue reading ›

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As Americans, we love to cite the First Amendment of our constitution any time someone doesn’t like what we say. The one that says that we can say whatever we want without worrying about prosecution. In reality, though, that’s not quite true. The First Amendment does indeed protect freedom of speech, but not all forms of speech are protected under the Constitution. For example, libel, incendiary speech (a.k.a. “fighting words”), and “true threats” are not protected under the Constitution. The problem can be discerning what makes a “true threat”, and the difficulty has multiplied with the use of social media. Without body language and tone of voice to indicate whether something is meant earnestly or in jest, people can find themselves in trouble for saying the wrong things. In a recent case, which will be heard by the Supreme Court in the fall, Anthony Elonis posted some rap lyrics to his Facebook page after his wife, Tara Elonis, left him, taking their two children with her. Like most rap, Elonis’s lyrics were crude and brutally violent, including a suggestion for his son to consider a Halloween costume that included Tara’s “head on a stick”. Anthony Elonis also reportedly fantasized about killing an F.B.I. agent and warned that “Hell hath no fury like a crazy man in a kindergarten class.” Continue reading ›

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In the United States, we have multiple venues for addressing conflicts. Lawsuits that are filed can be handled by either the state or the federal courts or if there is an arbitration agreement preventing use of the courts through a private trial. In general, federal courts only handle large cases that cover multiple states and involve federal statutes or claims of $75,000 of over between citizens of different states or a country. The state courts tend to handle smaller cases in which the dispute is limited to one state. In some instances, a lawsuit may fit the jurisdiction for either state or federal court. In the past, plaintiffs in class action lawsuits could only file non-federal statutory claims only in state court.

In order to federalize most class actions, the Class Action Fairness Act (CAFA) was passed in 2005. This law allows defendants to move a class action lawsuit out of state court and into a federal court if the case meets three requirements: 1) The class must have at least 2 members who are citizens of different states; 2) the amount under dispute must reach at least $5 million; and 3) the class must consist of at least 100 members. If the lawsuit meets all of these criteria, the defendants can file a motion asking for the case to be moved to federal court. Since most federal courts tend to be fairly sympathetic towards defendants in class action lawsuits, this is a common practice for defendants involved in large legal disputes. Continue reading ›

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With the invention of cell phones and prepaid plans, people suddenly found themselves getting charged for promotional calls and texts made by various companies. Cold calling was a standard sales technique for most companies for decades, and while some consumers may have found them obnoxious, they were never actively harmful.

That remained true so long as the companies were the ones paying for the calls that they made. When the phone bills were switched to the consumers, people started to complain. Legislators responded by creating the Telephone Consumer Protection Act (TCPA) which prohibits companies from calling or texting consumers, without the prior consent of those consumers, except in emergency situations. Since there are very few, if any, emergency situations which would warrant a company contacting its customers immediately, this effectively forbids companies from contacting their customers via phone, without the proper authorization.

With various laws like the TCPA, it can be hard for the average citizen to keep up with them all. Companies have gotten pretty good at keeping track of them, though, as well as avoiding them. Permission for the company to contact the customer, or a waiver of certain rights on the part of the customer, have become standard in all sorts of contracts. It is for this reason that consumers are often warned to read the fine print before they sign anything, though few of them actually do. Continue reading ›

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For decades, calling customers, or potential customers, about a promotion was standard practice for most companies. Of course, many consumers found this to be annoying, but it was never overtly harmful. That changed with the advent of cell phones and prepaid plans. When landlines were the norm, the caller paid for the call. Now, cell phone users pay for the calls and text messages that they receive. As a result, legislators came up with the Telephone Consumer Protection Act (TCPA) to prevent companies from taking advantage of consumers by making them pay for promotional calls and texts. Under the act, companies are forbidden from making calls or texts to consumer phone numbers without the consumers’ express consent, except in the case of an emergency.

The Los Angeles basketball team, the Clippers, have recently settled a class action lawsuit for allegedly violating the TCPA. According to the lawsuit, fans of the California-based basketball team allegedly received promotional texts via autodialers from the Clippers without the required authorization. Rather than facing a long, drawn-out battle in court, which could be very costly and time-consuming, the Clippers and the class of plaintiffs have agreed to settle the case. Continue reading ›

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Although there are laws in place to prevent entities and citizens from harmful comments, such laws have to tread carefully to avoid stepping on the toes of the First Amendment to our constitution. The line got even thinner when the Internet was developed. Now people are free to broadcast their opinions all over the world with a relative amount of anonymity. The combination tends to make people freer about stating their thoughts, but if they’re not careful, those people might find themselves facing a lawsuit for defamation.

Sarah Jones, a former cheerleader for the Cincinnati Bengals, has also worked as a teacher at Dixie Heights High School in Edgewood, Kentucky. At the end of 2009, a user of TheDirty.com posted a photo on the website of Jones with a man and made offensive comments about Jones’s sex life, and the sex life of her partner. Jones repeatedly asked for the posts be removed, and Nik Richie, the owner of the website, refused. Jones responded by filing a lawsuit for defamation against the company that operates the gossip site, Dirty World, LLC, and Richie. The lawsuit alleged that the posts humiliated Jones, undermined her position as an educator, her membership in the Cincinnati Bengals cheerleader squad, and her personal life.

The content posted on TheDirty.com is never created by Richie, but submitted by third parties. Richie then reviews and publishes the submissions with his own comments. Richie and his attorney cited this as a basis for Richie’s immunity under the federal Communications Decency Act of 1996 (CDA). Continue reading ›

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