Best Business And Class Action Lawyers Near Chicago

Stock Options Part of Taxable Compensation Seventh Circuit Appeals Court in Chicago Holds — Chicago Shareholder Dispute Attorneys and Chicago Partnership Dispute Lawyers

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

Stock options exercised by railroad employees are a form of monetary compensation taxable to the employer and employee under the Railroad Retirement Tax Act, according to the Seventh Circuit Court of Appeals (Wisconsin Central Ltd., et al. v. United States, No. 16‐3300 (7^th Cir. 2017)).

In 1996, three Midwestern railroad subsidiaries of the Canadian National Railway Company began including stock options in their employees’ compensation plans. In its appeal from a district court ruling, the railway argued that income from the exercise of stock options that a railroad gives its employees is not a form of “money remuneration” to them and is therefore not taxable to the railway under the Act, which defines “compensation” as “any form of money remuneration paid to an individual for services rendered as an employee… .”

The Railroad Retirement Tax Act of 1937 is the railroad industry’s version of the Social Security Act; it imposes a payroll tax on both employer and employee to pay for pensions and other benefits.

The question before the Seventh Circuit was whether the tax should be levied on the value of stock options exercised by employees when the market price reaches a certain level. The Internal Revenue Service argued that it should, and in a 2-1 decision, the court agreed.

Writing for the majority, Judge Richard Posner stated: “Stock has so well‐defined a monetary value in our society that there is no significant economic difference between receiving a $1,000 salary bonus and a share or shares of stock having a market value of $1,000.” Continue reading ›

FCRA Violation For Obtaining Job Applicant’s Credit Report 9th Circuit Rules

April 14, 2017 | Peter S. Lubin and James V. DiTommaso

Under a federal law that requires employers to inform job applicants that they may obtain their credit reports as part of the application process, an employer cannot make applicants sign a release from liability before procuring the report. (Sarmad Syed v. M-I, LLC, No. 14-17186 (9^th Cir. 2017). In a case of first impression in the federal circuit, the Ninth Circuit Court of Appeals held that a prospective employer violates the Fair Credit Reporting Act (FCRA) when it procures a job applicant’s consumer report after including a liability waiver in the same document as the disclosure to the applicant.

In amending FCRA in 1996 to require employer disclosure, “Congress was specifically concerned that … employers were obtaining and using consumer reports in a manner that violated job applicants’ privacy rights,” the panel wrote, especially in light of inaccurate information often contained in reports. The law requires an employer to disclose that it may obtain an applicant’s credit report and enables the applicant to withhold authorization or to warn the employer that the report might contain errors. 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 ›

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 ›

Supreme Court Sends Statutory Claim Back to Appellate Court to Determine if Intangible Injury Requirement For Article III Constitutional Standing Can Be Met

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

In the court system of the United States, it is possible for plaintiffs who have not suffered a measurable injury but have suffered an intangible injury such as invasion of privacy or loss to reputation or humiliation to file a lawsuit against another party. This means even if the plaintiff has not been physically injured or suffered any financial loss, they might still have an opportunity to make someone pay up for violating the law.

Most laws come with statutory provisions in which the statutory penalty for breaking the law is often written into the legislature itself. Sometimes it’s a defined number and other times it’s a range. Either way, they provide an opportunity for plaintiffs who have not lost anything tangible to file claims.

Businesses lately have been complaining about a slew of consumer class action lawsuits that focus on what they claim are mere technical violations of the law. One such case is that of Thomas Robins against Spokeo Inc., a people search engine. Robins alleged Spokeo had violated the Fair Credit Reporting Act (FCRA) by posting that he was employed, wealthy, and married, when in fact he was single and struggling to find work. Continue reading ›

Motion to Dismiss Filed in Class Action Suit Alleging Manipulation of NFL Ticket Prices

June 25, 2014 | Peter S. Lubin and James V. DiTommaso

When considering filing a lawsuit against a company or individual, it is advisable to first make sure that you have a strong case. The first things to check are that you are covered under the relevant law and that you have a valid claim for loss of a certain monetary value. It is important to note that deciding not to buy something because the price was too high does not constitute a loss.

Ben Hoch-Parker disagrees. He and Josh Finkelman filed a class action lawsuit against the National Football League for allegedly violating the New Jersey Consumer Fraud Act (NJCFA). The lawsuit alleges that the NFL withholds 99% of its Super Bowl tickets from the general public. According to the lawsuit, the NFL gives 75% of the big game tickets to the 32 NFL teams. Five percent goes to the host team, 17.5% to each team that is represented in the Super Bowl, and the remaining 29 teams each get 1.2% of the tickets. Another 25% of the game tickets are then allegedly given to broadcast networks, media sponsors, the host committee, and other insiders.

Once the NFL’s member clubs have their tickets, the NFL allegedly places no restrictions on the sale of those tickets, allowing the NFL franchises to auction off their ticket allotments to the highest bidding ticket broker. The lawsuit alleges that, “The broker then sells the tickets for exorbitant amounts on the secondary market.”

The lawsuit is filing a claim for this allegedly illegal practice because the NJCFA states that at least 95% of tickets must be sold to the general public. Instead, the lawsuit alleges, every year, the NFL prints “tens of thousands of Super Bowl tickets, yet it only allocates a meager one percent of these tickets for release to the general public through a lottery system, forcing all other fans into a secondary market for the tickets where they must pay substantially more than the ticket’s face value to attend one of the most popular and iconic sports events of the year.” Continue reading ›

Sands Casino and Former Manager Trade Accusations

September 6, 2013 | Peter S. Lubin and James V. DiTommaso

Firing an employee is always a delicate matter. Not only are wrongful termination lawsuits a possibility, but there’s always the possibility that the employee has some information on the company which might be less than flattering. In a recent lawsuit, Steven Jacobs alleges he was wrongfully terminated by Sands China Ltd. as their chief executive officer. He also claims to be in possession of certain incriminating documents which Sands China might prefer not be revealed in a court of law.

The documents consist of about 40 gigabytes of information, which Sands says that Jacobs took “surreptitiously” when he was fired in 2010. The information includes three reports prepared by Steve Vickers of International Risk Ltd. The reports allegedly featured the investigation of “certain Macau government officials” and others, according to the letters sent by Sands’s lawyers to Jacobs’s lawyers, asking for the return of the documents.

Jacobs alleges that the reports were commissioned by Sands and include incriminating information “on foreign government officials, as well as individuals with whom they were doing business that were suspected of having ties to Chinese organized crime.”

Jacobs alleges that his employment with Sands was wrongfully terminated after he had disagreements with Adelson, Sands’s majority owner and chairman. The disputes include arguments over what Jacobs alleges were illegal demands that secret investigations be conducted of Macau government officials for information which Sands could then use as leverage against unfavorable regulations.

After Jacobs made these allegations, the U.S. Justice Department and Securities and Exchange Commission opened investigations to determine if Adelson’s company violated the Foreign Corrupt Practices Act. This Act bars any company with operations in the U.S. from making improper payments to foreign officials in order to win or maintain business.

Although Sands denies Jacobs’s allegations, it did admit a few months ago that it had found likely violations of the books, records, and internal provisions of the Foreign Corrupt Practices Act. Around the same time, Adelson said in a declaration that the investigation had been commissioned by Jacobs, not by the company. Adelson claims that he knew nothing of the investigation until after Jacobs had been fired. In his declaration, Adelson states, “I never asked or authorized Jacobs to conduct a private investigation or ‘create a dossier’ on Macanese officials. … We believe unequivocally that Jacobs initiated the investigation on his own for his own purposes.”

Last year, Sands was sanctioned by Nevada District Judge Elizabeth Gonzalez for failing to disclose the fact that it was sitting on a trove of documents in Nevada which Jacobs sought to use as evidence. The company, however, claimed that the documents could not be removed from Macau and that they are “privileged” and therefore exempt from disclosure. Gonzalez disagreed however, and ruled that Jacobs could legally use the documents as evidence.

Currently, the case has reached a standstill. Sands is now appealing three other rulings by the lower court to the Nevada Supreme Court and, most recently, it has won a postponement hearing on whether Sands China, being a Chinese company, can be tried in Nevada.

Jacobs claimed that this is nothing more than stalling the case in order to keep the incriminating documents against Sands hidden. Sands called these accusations “baseless”.

Online Defamation — Our Chicago Libel Attorneys Defend and Prosecute Online Slander and Libel Cases

September 5, 2013 | Peter S. Lubin and James V. DiTommaso

//www.youtube.com/watch?v=fGR6M8PnXiE

Estee Lauder Sued in Class Action For Alleged False Claims That Skin Cream Repairs DNA Damage

September 4, 2013 | Peter S. Lubin and James V. DiTommaso

The Class Action Lawsuit claims that Estee Lauder’s skin cream claims about repairing DNA are fraudulent. But as unbelievable as it sounds, dermatologist Dr. Jeanette Graf said creams can repair DNA.

“Whether it’s in the form of peptides, whether it’s in the form of retinols, whether it’s in the form of enzyme inhibitors — all of which play a role together in diminishing the amount of DNA damage,”

Graf told CBS News.

Campbell’s Soup and American Heart Association Deny Plaintiffs’ Claims in Misleading Labeling Lawsuit — Our Chicago Consumer Lawyers Pursue Consumer Fraud Claims in Chicago and Throughout the United States

September 2, 2013 | Peter S. Lubin and James V. DiTommaso

Most Americans are aware that what we eat has a large impact on our health, both short term and long term. Not least among these is the fact that diet plays a major role in heart disease. In order to ensure that they are making the best possible decisions at the grocery store, many Americans rely on information from the American Heart Association (AHA) in order to provide them with the necessary guidelines. To facilitate this, the AHA marks certain processed foods with a Heart Check mark in order to notify consumers that this particular food follows the guidelines as set out by the AHA.

However, according to the allegations in a recent lawsuit against the AHA and Campbell Soup Co., the Heart Check mark can be misleading. The lawsuit alleges that the AHA collects fees from “manufacturers of unhealthy, processed foods” in return for the manufacturer being granted the right to put the Heart Check mark on their products. However, according to the lawsuit, Campbell’s “Healthy Request” soups allegedly do not meet the AHA’s “non-commercial nutritional guidelines” most notably for sodium. Instead, the lawsuit alleges, the foods bearing the Heart Check mark meet the lower standards of the federal Food and Drug Administration. This could potentially cause problems for many consumers since high sodium consumption has long been association with high blood pressure and heart disease.

The lawsuit alleges that this practice is “unfair, deceptive and misleading” because it “causes consumers to overpay for Campbell’s AHA-certified soups, but also presents substantial health risks to all consumers, including the more than five million American consumers suffering from congestive heart failure”.

According to the lawsuit, Campbell Soup gets to charge customers more for its Healthy Request Products than it does for its other products, while the AHA collects between $5,200 and $17,500 per product each year. So the arrangement is of financial benefit to both Campbell Soup and the AHA while allegedly being detrimental to both the budget and the health of consumers.

The lawsuit alleges that a single serving of Campbell’s AHA-certified soups have “nearly three times the amount of sodium permitted by the AHA’s noncommercial nutritional guidelines, while a full can contains between six and seven times that amount.” Food manufacturers often play with their serving sizes in order to make their food fit nutritional guidelines. The AHA Heart Check mark has allegedly appeared on 97 different Campbell products ranging from soups to juices, breads, and sauces.

Carla Burigatto, Campbell’s director of external communications, has released a statement saying that “Campbell has complete confidence in the accuracy of our labels and our marketing communications and that they meet regulatory and other legal requirements”.

The American Heart Association has likewise denied the allegations of the lawsuit, saying that its “food certification program regularly conducts laboratory testing to verify that products earning the Heart Check mark meet our nutritional criteria”. They are careful to point out that these criteria “are more stringent that those of the Food and Drug Administration.” The AHA also insisted that the revenue from the Heart Check fees “is only sufficient for the program’s product testing, public information and program operating expenses.”