Articles Posted in Class-Action

Congress is currently considering two new bills that take aim at the practice of requiring consumers to agree to resolve all disputes through binding arbitration and including class action waivers in consumer contracts. If passed and signed into law, the laws could dramatically change the way businesses contract and resolve disputes with consumers.

The first bill being considered is the Forced Arbitration Injustice Repeal Act (“FAIR Act”). Introduced by Senator Richard Blumenthal of Connecticut in the Senate (S. 620) and Representative Hank Johnson of Georgia in the House (H.R. 1423), the FAIR Act seeks to amend the Federal Arbitration Act (“FAA”), 9 U.S.C. §1, et seq., and would prohibit the inclusion of mandatory arbitration clauses in contracts with employees and consumers. Continue reading ›

Where a class of consumers sued an energy company for breach of contract, fraud, and unjust enrichment, the district court dismissed some, but not all, of the claims. The district court found that the consumers had sufficiently alleged that the energy company violated its agreement to charge rates for electricity based on market conditions and that the consumers had pled a claim for unjust enrichment in the alternative. However, the court found that the consumers failed to allege adequate details of a fraudulent scheme.

Verde Energy USA, Inc. was sued by a class of consumers in federal court for the Northern District of Illinois. The consumers alleged that Verde violated the Illinois Consumer Fraud and Deceptive Business Practice Act, breached its contract, or alternatively was guilty of unjust enrichment with respect to the class. The consumers’ complaint alleged that Verde had taken advantage of the deregulation of the Illinois energy market, convincing consumers to switch from their prior energy company to Verde by offering a teaser rate that was lower than the utilities’ actual rates for electricity. The consumers alleged that, after the teaser rate expired, Verde switched consumers to a variable rate that was not based on market conditions as required by the contract the consumers had with Verde. Continue reading ›

Where a person whose biometric information was collected by a private entity who failed to comply with the requirements of the Illinois Biometric Information Privacy Act was an aggrieved person entitled to sue within the meaning of the act even if they had sustained no further injury beyond the violation of the act itself.

Six Flags Entertainment Corporation and its subsidiary Great America LLC own and operate the Six Flags Great America amusement park in Gurnee, Illinois. As part of this operation, Six Flags sells repeat-entry passes to the park. Since 2014, Six Flags has used a fingerprinting process when issuing those passes. The Six Flags system scans pass holders’ fingerprints, collects, records and stores “biometric” identifiers and information gleaned from the fingerprints, and then stores that data in order to quickly verify customer identities upon visits by pass holders to the park.

In May or June 2014, while the fingerprinting system was in operation, Stacy Rosenbach’s 14-year-old son, Alexander, visited the amusement park on a school field trip. In anticipation of the trip, Rosenbach purchased Alexander a season pass online. Rosenbach paid for the pass and provided personal information about Alexander, but Alexander was required to complete the sign-up process at the amusement park. Alexander was asked to scan his thumb into Six Flags’ biometric data capture system. He was then issued a season pass card. Rosenbach allegedly learned that Alexander’s fingerprints had been taken for the first time when Alexander returned home from the field trip.

Rosenbach eventually filed suit, acting in her capacity as mother and next friend of Alexander, against Six Flags. Continue reading ›

The Illinois Appellate Court reversed a decision by the Illinois Circuit Court in a class action concerning the Consumer Fraud Act, where a retailer was alleged to have improperly collected taxes on exempt bottled water products. The court found that the voluntary payment doctrine did not apply to a payment that was allegedly obtained through deceptive business practices or acts. The court also found that an intent to deceive could be shown by evidence that the payment of the tax by the consumer was a predictable consequence of the retailer asking the consumer to pay the tax.

In 2008, the City of Chicago began imposing a five-cent tax on the sale of bottled water within city limits. Retailers are required to include the tax in the price of bottled water. The city excludes certain bottled beverages from the tax including certain brands of sparkling and mineral water, and other flavored and carbonated water products.

Destin McIntosh sued Walgreens Boots Alliance in Illinois state court. McIntosh filed a class action alleging that Walgreens violated the Consumer Fraud and Deceptive Business Practices Act by charging the bottled water tax on sparkling water sales that were supposed to be exempt. Walgreens attempted to dismiss the case, arguing that McIntosh’s claim was barred because the tax was disclosed to McIntosh at the time of purchase and that the tax was remitted to the city. The Illinois circuit court granted the motion, and McIntosh appealed. Continue reading ›

Where district court did not err when it certified a class of consumers of software that promised to improve the function of their computers, and then ran worthless fixes. The appellate panel found that the class requirements were satisfied because all consumers saw the same advertisements, and the software allegedly functioned the same on every user’s machine.

Archie Beaton saw an advertisement on the internet for SpeedyPC Pro software. The advertisement suggested that SpeedyPC Pro could improve the performance of a user’s computer, and offered a free test to check the user’s machine for flaws. Beaton downloaded a free trial of the software and ran its test on his machine. The test reported hundreds of errors, and told Beaton that purchase of the full version of the software could fix the errors and improve performance. Beaton dutifully purchased the full version of the software, but after running its fix feature several times, nothing changed on his machine.

Beaton later sued SpeedyPC in federal court in the Northern District of Illinois. Beaton filed a class action, alleging that SpeedyPC fraudulently told all users of its software that their computers were in need of fixes, and then, after the users bought the full version of SpeedyPC Pro, performed functionally worthless fixes. Beaton defined the class in his case as that of “all individuals and entities in the United States who purchased SpeedyPC Pro.” He also defined a subclass representing only Illinois consumers. The district court certified Beaton’s proposed class and subclass for claims of the breach of implied warranties of fitness and merchantability, and claims under the Illinois Consumer Fraud and Deceptive Business Practices Act for the subclass. SpeedyPC filed an interlocutory appeal challenging the class certification. Continue reading ›

As consumers become increasingly aware of the potentially harmful side effects of certain chemicals used to extend the shelf life of prepared foods, the demand for packaged foods that are free of preservatives has gone up and continues to go up. Many consumers are prepared to pay a higher price for foods bearing labels such as “organic” and “all natural,” while others simply refuse to buy any foods they cannot be certain are free from artificial preservatives.

The more scrupulous buyers check the ingredients of everything they buy before taking it to the checkout counter, and over the years, people have come up with a few different rules regarding what to look for in the ingredients label. For example, some say you shouldn’t buy anything containing any ingredients you can’t pronounce, while others claim you simply shouldn’t buy anything with more than five ingredients.

Still others just rely on the product’s label. If the company claims their product is free of artificial preservatives, most customers will take that claim at face value and grab the product without bothering to check the ingredients label. Others rely on labels with terms like “all natural,” even though products don’t need to meet any legal qualifications in order to put that label on their products (as opposed to the term “organic,” which does require the product to be certified organic by the U.S. Department of Agriculture). Continue reading ›

For years the NutriBullet blender has been marketed as a small, convenient blender people can use to make single-serving smoothies and other cold drinks, then pop off the cannister and drink. The blender has been marketed as a “nutrition extractor,” implying people can get more nutrition in their diets by drinking their fruits and vegetables with the help of the blender. What the blender’s marketing fails to mention is the allegation that it tends to build up the pressure and explode.

Capital Brands, the company that makes the NutriBullet blenders, advises users of the product to only make cold drinks in the blenders and avoid putting anything hot in it to avoid overheating. They also recommend using it for no more than 60 seconds, at which point a safety mechanism will turn the NutriBullet off in order to avoid any accidents as a result of overheating.

But consumer lawsuits claim the blender has been known to overheat and even explode, even when consumers follow the directions and use it with cold foods for less than 60 seconds. One such lawsuit was brought against the company in North Carolina and is currently pending in court. In California, one consumer rights attorney says he has brought almost two dozen lawsuits against Capital Brands over the alleged defect in their NutriBullet blenders.

Now Deveta White has joined the list of consumers to sue Capital Brands over their allegedly dangerous NutriBullet blenders. The only difference is that White’s consumer lawsuit is the first to seek to represent a class of similarly situated plaintiffs against Capital Brands. Continue reading ›

While most companies let people return a product a month or two after purchase if something goes wrong, some companies go above and beyond by offering a lifetime guarantee. The idea is to ensure customers that nothing will go wrong with the product during its lifetime, and if something does go wrong, the company will either replace the item or reimburse them the cost of the item. A lifetime guarantee is a sign that the company believes in the quality of its products and will go to great lengths to make sure their customers remain satisfied.

But some people choose to interpret “lifetime warranty” to mean the product is guaranteed to last for the rest of their lifetime, rather than the standard lifetime of the product. According to Shawn O. Gorman, the Executive Chairman of L.L. Bean, some customers were taking advantage of the company’s lifetime warranty to mean anything they bought from the company would not be subject to wear and tear, and if it were, the company should reimburse them for the item or replace it.

According to an open letter to the public released by the company on February 9th, some people were taking advantage of the lifetime guarantee by trying to get replacements or reimbursements for products several years after they had been purchased. Some had even sought replacements or reimbursements for used L.L. Bean items they had bought at garage sales. As a result, the company recently decided to get rid of its century-old lifetime guarantee and to replace it with a one-year warranty – which can only be used if the customer still has their receipt. The company said it will still work with customers who want to return or get reimbursed for a product more than a year after the date of purchase, but only if the product is defective. Continue reading ›

Despite the fact that judges are the ones who set bail, one Cook County court judge, Judge Celia Gamrath, says it is up to lawmakers, rather than judges, to determine how judges are allowed to set bail.

The issue in question is the fact that Cook County judges have been using a cash bail system. The intention behind such a system is to give defendants a reason to appear in court, but a recent class-action lawsuit alleges it has also had the effect of discriminating against minorities and the poor, who are often unable to come up with the cash necessary to pay their own bail.

The lawsuit was filed against five Cook County court judges on behalf of two detainees who sat in jail for almost a year because they couldn’t afford to post their own bail. They both eventually pled guilty to the charges against them.

Alexa Van Brunt, one of the attorneys who filed the lawsuit against the judges, said they plan to appeal Judge Gamrath’s decision, claiming they hadn’t even had a chance to fully explain their arguments regarding the allegedly unconstitutional nature of the current cash bail system before Judge Gamrath dismissed them.

Van Brunt noted that the lawsuit might feel political to Gamrath because the class action is asking her to make a ruling about other Circuit Court judges. In fact, that’s not what they’re trying to do at all – instead, they are just asking the judge to help make sure the courts follow the law. But Van Brunt claimed the judge chose to get the lawsuit off her desk rather than face the consequences of ruling on a potentially sticky situation. Continue reading ›

We all know the basic concept of supply and demand. When supply is low and demand is high, prices tend to go up. When this happens with houses, realtors refer to it as a “seller’s market,” but what if it’s really a “realtor’s market?”

That allegation is at the heart of a recently proposed class action lawsuit against Houlihan Lawrence, a large brokerage firm with 30 offices spread throughout the northern New York suburbs and Fairfield County, Connecticut.

The lawsuit was filed by Pamela Goldstein, an associate general counsel for a communications company who fell in love with a four-bedroom, white, colonial house located in White Plains, New York. The agent who showed her the house, Daniel Cezimbra, allegedly told her there were other offers on the house and that she had better act fast and bid above the $599,000 asking price.

Goldstein took his advice, and eventually bought the house for $637,000, but then she discovered something that made her question that interaction – and her agent’s motives.

It turns out that Houlihan Lawrence was also representing the person selling the house. This meant that, when Cezimbra was supposed to be negotiating on Goldstein’s behalf and representing her interests in the bidding war, he was going up against his boss – who also happens to be his brother-in-law. No matter how hard people work to be fair and unbiased, it has to be hard to do your best negotiating when the person across the table from you has the power to fire you. Continue reading ›