Class-Action

CFPB Adopts New Rule Banning Arbitration Agreements — Chicago Class Action Lawyers Near Oak Brook

July 22, 2017 | Peter S. Lubin and James V. DiTommaso

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 ›

Sterling Jewelers Settles With EEOC But Still Faces Class Action By Women Employees

July 13, 2017 | Peter S. Lubin and James V. DiTommaso

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 ›

More Data Breach and Privacy Class Actions Continue to be Filed — Chicago’s Top Class-Action Lawyers Near Oak Brook and Elmhurst

July 8, 2017 | Peter S. Lubin and James V. DiTommaso

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 ›

McDonald’s Franchisee Sued For Requiring Employees to Use Debit Cards to Obtain Wages

July 7, 2017 | Peter S. Lubin and James V. DiTommaso

The days of trading items for other items are all but gone. Individuals might still maintain this practice in private between one another, but when it comes to how companies can pay their workers, they usually only have two choices: cash or check.

The rise of technology has led to other options, such as direct deposit and debit cards, but not all of these new options are allowed under the relevant labor law. According to Pennsylvania’s Wage Payment and Collection Law (WPCL), employers are permitted to use only cash or checks to pay their workers.

But a recent class action wage and hour lawsuit filed against a Pennsylvania McDonald’s franchisee, alleges the franchisee’s use of debit cards to pay employees their wages is a violation of the WPCL.

The class action lawsuit was filed against Carol and Albert Mueller, who, together, operate 16 different McDonald’s franchise locations across Pennsylvania. They allegedly used debit cards to pay almost 2,400 employees their wages from late 2010 until the summer of 2013. Continue reading ›

Seventh Circuit Rejects Consumer Fraud Class in Putative Eye Drop Class Action

June 20, 2017 | Peter S. Lubin and James V. DiTommaso

Seventh Circuit Court of Appeals Judge Richard Posner made quick work of a recent class action suit brought by glaucoma patients who alleged that Allergan, Inc., and other drugmakers manufactured prescription eyedrops that were too large in order to increase their profits (Eike, et al., v. Allergan, Inc., et al., No. 16-3334, 7^th Cir. (2017)). The case was on appeal from a district court ruling certifying eight classes of plaintiffs consisting of Illinois and Missouri residents who alleged that Allergan and six other pharmaceutical companies made eye drops that were unnecessarily large, in violation of the Illinois Consumer Fraud Act and Missouri Merchandising Practices Act.

Each eyedrop exceeded 16 microliters, beyond the optimal size the plaintiffs contended was necessary for treatment of glaucoma and therefore wasteful because the additional microliters added no therapeutic value, instead serving only to pad the companies’ profits. The plaintiffs sought damages amounting to the difference between the price per drop of the eye drops at their present size and the presumably lower price of smaller drops, multiplied by the number of drops purchased by the class members. Continue reading ›

Class Actions and Collective Actions Can Proceed Together Appellate Court Rules

December 15, 2016 | Peter S. Lubin and James V. DiTommaso

Class action and collective action lawsuits are both important tools for plaintiffs with common complaints against the same defendant. Both types of lawsuits allow plaintiffs to do essentially the same thing in terms of the rights they can win for plaintiffs, but with one distinct difference.

In class actions, all the potential plaintiffs that can be identified are automatically included in the class unless they opt out. By contrast, collective actions require potential class members to submit a valid claim in order for them to be included in the lawsuit. Each type of lawsuit has its own procedural rules but, according to the Eleventh Circuit Court, the filing of one type of lawsuit does not invalidate a lawsuit of the other kind, even if both were filed by the same plaintiffs.

Four sheriff’s deputies in Lee County, Florida filed a collective action against their sheriff, Michael Scott, for allegedly requiring them to work overtime without properly compensating them for the extra hours they worked. The collective action alleges Scott violated the federal Fair Labor Standards Act (FLSA) by refusing to pay the proper overtime compensation of one and one-half times their normal hourly rate when they worked more than 40 hours a week. Continue reading ›

Overtime Case Settles Against Labor Ready for up to $4.5 Million

December 5, 2016 | Peter S. Lubin and James V. DiTommaso

We live in a world in which everyone constantly feels like they don’t have enough time, which is why most of us hate to feel like anyone is wasting our time. That feeling only gets worse when we don’t have any control over it, such as when our employer keeps us waiting.

According to a recent wage and hour lawsuit filed against Labor Ready, a temp agency, the company allegedly kept its temporary workers waiting to receive assignments without paying them for the time they spent waiting. The company also allegedly refused to pay them for the time they spent traveling to their assignments and also allegedly charged them a fee to cash their paychecks.

Most workers don’t think of the time they spend traveling to and from work as time they should be paid for, but there are certain instances in which that time is compensable. For those who work at the same location every day and simply commute between home and work, no payment for that time is required. On the other hand, some workers who are required to travel between different work sites in the course of a day should be paid for the time they spend traveling between sites.

The same goes for those who need to check in at one location before traveling to another site to perform their actual tasks for the day. This can sometimes be the case for those working for temp agencies when they’re technically employed by the temp agency, but the work they’re actually doing is for the agency’s client, usually at a separate location. Continue reading ›

Employment Law Class Action Settled by FedEx — We are Experienced Chicago Non-Compete Agreement and Employment Law Attorneys

November 24, 2016 | Peter S. Lubin and James V. DiTommaso

It’s often more cost effective for companies to hire independent contractors to perform certain jobs, rather than hiring employees. Even for part-time employees, companies are responsible for paying things like employment taxes and Social Security, none of which they have to worry about with independent contractors. There are benefits to working as a true independent contractor, but because independent contractors are not protected by the federal Fair Labor Standards Act (FLSA), workers have to meet very specific requirements in order to legally be considered independent contractors.

Under the FLSA, workers classified as independent contractors must be able to negotiate their own rates, have control over their own schedule, the environment they work in, and have a certain level of discretion as to how they perform their duties, among other things. Any and all workers who do not meet all of the necessary qualifications for independent contractors must be classified and compensated as employees, including benefits (such as health insurance) for full-time employees.

Many employers have been illegally classifying drivers as independent contractors and FedEx is just one of several companies to have recently faced multiple class action wage and hour lawsuits from drivers alleging they should have been classified as employees.

Current and former FedEx drivers from approximately 40 different states have been filing wage and hour lawsuits against the giant shipping company for more than ten years now. Many of those lawsuits were consolidated into multidistrict litigation (MDL) and then certified as class actions so that drivers from all across the country could combine their claims against FedEx. Continue reading ›

Amazon Arbitration Agreement Doesn’t Bar Class Action Appellate Court Rules

November 3, 2016 | Peter S. Lubin and James V. DiTommaso

In this online shopping age, when consumers click “place your order” on Amazon.com or any retail website, do they really know what they are agreeing to? The U.S. Court of Appeals for the Second Circuit recently considered the question in Nicosia v. Amazon.com, Inc., No. 15‐423‐cv (2nd Cir. 2016).

In 2013, Dean N. bought a weight loss pill on Amazon called “One Day Diet,” which unbeknownst to him, contained sibutramine, a controlled, prescription-only substance that had been pulled from the market by the FDA in 2010 because of health risks. Sibutramine was not listed on the site as one of the product’s ingredients, nor did Amazon require a prescription for purchase. The FDA revealed in November 2013 that One Day Diet contained sibutramine.

Dean brought a putative class action against Amazon, alleging the online retailing giant had sold and was continuing to sell weight loss products containing sibutramine in violation of federal law and state consumer protection laws. He alleged breach of implied warranty and unjust enrichment, seeking both damages and an injunction prohibiting Amazon from further sale of products containing sibutramine. Continue reading ›

Uber Cannot Escape Price Fixing Class Action Through Arbitration Agreement New York Federal Judge Rules

September 20, 2016 | Peter S. Lubin and James V. DiTommaso

Most of us are familiar with that little box that pops up every time we visit almost any website. It usually says something about agreeing to the terms of service, which are sometimes listed in the box, while other times there’s a link to a full web page devoted to a long list of legal terminology that few people bother to read. More often than not, users check the box without bothering to read all or any of the terms of service so we can go about our business. Reading all the terms of every service we ever use could very well take up most or all our time so we tend to skip over them.

Recently, U.S. District Judge Jed Rakoff recognized this fact when denying Uber’s motion to compel arbitration that was filed in Manhattan federal court.

Spencer Meyer, an Uber customer from Connecticut, sued the ride share company’s CEO, Travis Kalanick, for allegedly participating in a price-fixing scheme with drivers that allegedly raised Uber prices during periods of high demand. Because Uber takes a certain percentage of every driver’s earnings, the lawsuit alleged both Uber and its drivers benefited from the allegedly calculated rise in prices. Although the consumer lawsuit was initially filed only against Kalanick, the complaint was later amended to include Uber as a defendant and that’s when the company asked the court to compel arbitration. Continue reading ›