The Kentucky Supreme Court rejected a contractual ban on class actions by Insignt in a case regarding a mass shut down of consumer internet services
The Court held a class action “is often the only economically viable legal procedure” to address a large volume of very small claims, the court said in an opinion issued Thursday. For that reason, it said, a ban on class actions like the one in Insight’s contract “may effectively shield a company from liability for unlawful activity.” In the Insight case, consumers were seeking refunds on $40 bills and absent a class action that would not able to retain a lawyer to act as a private Attorney General to vindicate their rights and those of the other victims.
The Court provided this example:
The potential that an absolute ban on class action litigation may produce an improper exculpatory result is demonstrated by way of a simple example. Suppose XYZ Company inadvertently or intentionally overbilled each of its one million customers by one dollar during a particular month. As a result, it gained possession of one million dollars to which it is not entitled, and which instead belongs to its customer base. Suppose, in addition, that the company acted unethically (or incorrectly believed it had a valid defense) and refused to return the overcharges. Economic realities dictate that none of the one million overbilled customers would bring an individual claim seeking the recovery of his dollar. The time, effort, and expense involved to recover a dollar simply would not be worthwhile. Thus, while the economic loss to each individual customer would be negligible, the lack of an economically viable means to bring the company into court would effectively exculpate the company from liability, allowing it to reap unjustly a substantial economic windfall. We agree with the Appellants that the only economically viable means for customers to bring a company into court, as plaintiffs, under these circumstances is by class action litigation.
Public Justice, a national public-interest legal organization presented arguments for Insight customers in the case. “This decision makes it possible for consumers who are cheated out of small sums to fight that injustice,” Public Justice attorney Paul Bland said in a statement. Bland heads Public Justice’s class action protection project and has been instrumental in fighting for consumer rights in important cases across the country.
You can read the opinion of the Kentucky Supreme Court by clicking here.
Our lawyers have achieved consumer victories in class actions like the Insight case where consumers who had suffered small injuries received full refunds. In a case against Hilton for including a non-tax charge in the tax line item, we won at trial and each consumer victim who could be located received a check for 98% of their damages with all attorneys fees and court costs paid by Hilton as required by the Illinois Consumer Fraud and Deceptive Business Practices Act.
Our Gurnee, Illinois consumer rights private law firm handles individual and class action predatory lending, unfair debt collection, lemon law and other consumer fraud cases that government agencies and public interest law firms such as the Illinois Attorney General may not pursue. Class action lawsuits our law firm has been involved in or spear-headed have led to substantial awards totalling over a million dollars to organizations including the National Association of Consumer Advocates, the National Consumer Law Center, and local law school consumer programs. The Chicago consumer rights attorneys at Lubin Austermuehle are proud of our achievements in assisting national and local consumer rights organizations obtain the funds needed to ensure that consumers are protected and informed of their rights. By standing up to consumer fraud and consumer rip-offs, and in the right case filing consumer protection lawsuits and class-actions you too can help ensure that other consumers’ rights are protected from consumer rip-offs and unscrupulous or dishonest practices.
Our Glenview and Deerfield consumer attorneys provide assistance in fair debt collection, consumer fraud and consumer rights cases including in Illinois and throughout the country. You can click here to see a description of the some of the many individual and class-action consumer cases our Chicago consumer lawyers have handled. A video of our lawsuit which helped ensure more fan friendly security at Wrigley Field can be found here. You can contact one of our Waukegan consumer protection attorneys who can assist in consumer fraud, consumer rip-off, lemon law, unfair debt collection, predatory lending, wage claims, unpaid overtime and other consumer, or consumer class action cases by filling out the contact form at the side of this blog or by clicking here.