Chicago Business Litigation Lawyer Blog

Cicero Settles Another Sex Harassment Case Against the Town President — Our Chicago Employment Attorneys Represent Employers and Employees in Employment and Overtime Suits

August 12, 2013 | Peter S. Lubin and James V. DiTommaso

Cicero Town President Larry Dominick claims he knows how to avoid sex harassment: “You’re not supposed to touch ‘em, talk dirty, all kinds of stuff like that.”
However, Cicero has agreed to pay very large settlement of $675,000 to settle a sexual harassment case against Dominick. This is not the first such settlement.

Dominick allegedly requested that a former cop and another woman engage in a threesome. Dominick denies he ever harassed the former cop.

In his deposition in the case, Dominick says learned how to avoid harassing women employees: “You’re not supposed to touch ‘em, talk dirty, all kinds of stuff like that, you know, general things that most people should understand.”
In her lawsuit, the former cop, Lujano says Dominick “on a constant basis” made sexually explicit comments, including calling Lujano’s breasts “gazangas.” She claims Dominick reached out and touched her breasts.

She also claims Dominick whispered in her ear that “he wanted to have a threesome with her and another woman.” She alleges he offered to take her to the sexy getaway “Sybaris and, if not her, then her mother … because he liked her mother too.”
This is not the only time Cicero has had to pay up for alleged sex harassment by Dominick.

In 2011, Cicero paid the former head of the town animal shelter $500,000.

In that case, Sharon Starzyk claimed that Dominick groped her. She claimed on one occasion, when she and Dominick were in a car together, he allegedly passed gas and then groped her. Starzyk also alleged that Dominick sent her emails requesting a threesome with two of Dominick’s friends.

You can view part of Dominick’s deposition below.

Video: Odometer Roll-Back Fraud — Our Chicago Class Action Lawyers and Consumer Protection Attorneys Fight for Consumer Rights

August 11, 2013 | Peter S. Lubin and James V. DiTommaso

Odometer rolled back on car for sale

AOL reports:

Buying a used car is already risky business, and this story of fraud in New York will have you double checking your paperwork.

Matin Jarmuz used Craigslist.com to sell his 1992 Toyota Camry. According to Jarmuz’s Craigslist post, at 21-years-old and 200,000 miles the Camry still had a smooth, quite ride. He sold the car quickly to Chris Sciolino for $900 cash. Jarmuz thought he had made a good deal, until other Craigslist users alerted him that his old Camry was up for sale again by the same man he just sold it to, only this time listed at $1,800 and with 79,000 miles.

Odometer fraud is a serious problem in the U.S. In a 2002 study the National Highway Traffic Safety Administration determined that close to half a million cars are sold each year with false odometer readings, at a cost of more than of $1 billion dollars annually. Since the study was done, the Office of Odometer Fraud Investigations has seen an escalation in cases. Fixing an odometer is a federal crime, one made much easier on newer cars where, instead of cracking open a dashboard, sellers just need to hack the onboard computer.

Our Chicago auto fraud lawyers have spoken with many consumers who have been cheated through an odometer roll-back. A car with a odometer roll-back is generally considered unmerchantable as the real mileage can not be verified.

Seventh Circuit Affirms Class Certification in Wage Claim – Ross v. RBS Citizens, NA

August 10, 2013 | Peter S. Lubin and James V. DiTommaso

Employees of a bank with multiple branch locations throughout Illinois sued to recover unpaid overtime wages under both the federal Fair Labor Standard Act (FLSA) and the Illinois Minimum Wage Law (IMWL). After the district court certified two classes of plaintiffs, the defendant bank appealed the certification to the Seventh Circuit Court of Appeals. Based in part on a U.S. Supreme Court decision clarifying the requirements for class certification, the Seventh Circuit affirmed the district court’s order. Ross, et al v. RBS Citizens, N.A., 667 F.3d 900 (7th Cir. 2012).

The plaintiffs alleged in their lawsuit that the bank had several “unofficial” policies that allowed it to deny overtime pay to employees, id. at 903, such as using “comp time” instead of overtime wages or altering employee timesheets. They also alleged that some assistant bank managers (ABMs), while officially exempt from eligibility for overtime pay, spent most of their time on non-exempt work. The plaintiffs therefore sought to certify two classes: non-exempt employees who were entitled to overtime compensation, and ABM employees who performed non-exempt work and were entitled to overtime pay. A class action requires four basic elements: “numerosity, commonality, typicality, and adequacy of representation.” Id.; Fed. R. Civ. P. 23(a). The district court certified both classes under Rule 23(b)(3) of the Federal Rules of Civil Procedure (FRCP), which applies to cases where the issues affecting all class members supersede those affecting individual members, and where a class action is the best way to resolve the conflict.

Lawsuit Alleges Potato Prices Fixed

August 9, 2013 | Peter S. Lubin and James V. DiTommaso

7th Circuit Reverses Denial of Class Certification in Lockheed Martin Retirement Fund Case

August 8, 2013 | Peter S. Lubin and James V. DiTommaso

Plaintiffs claim that Lockheed breached its fiduciary duty to its retirement savings plan, under the Employee Retirement Income Security Act, 29 U.S.C. 1132(a)(2). The Plan is a defined-contribution plan, (401(k)); employees direct part of their earnings to a tax-deferred savings account. Participants may allocate funds as they choose. Among the investment options Lockheed offered was a “stable-value fund” (SVF). SVFs typically invest in a mix of short- and intermediate-term securities, such as Treasury securities, corporate bonds, and mortgage-backed securities. Holding longer-term instruments, SVFs generally outperform money market funds. For stability, SVFs are provided through “wrap” contracts with banks or insurance companies that guarantee the fund’s principal and shield it from interest-rate volatility. Plaintiffs allege that the Lockheed SVF was heavily invested in short-term money market investments, with a low rate of return that did “not beat inflation by a sufficient margin to provide a meaningful retirement asset.”
The district court granted Lockheed summary judgment with respect to some claims. The SVF claim survived.

The district court initially certified two classes under FRCP 23(b)(1)(A). On remand, the court declined to certify further narrowed classes. The Seventh Circuit reversed, reasoning that the plaintiffs carefully limited the class to plan participants who invested in the SVF during the class period and employed reasonable means to exclude from the class persons who did not experience injury. The Court held:

To conform to Spano’s warning that the class must not be “defined so broadly that some members will actually be harmed” by the relief sought, Plaintiffs limited their definition of the SVF class to those who suffered damages as a result of Lockheed’s purportedly prudent management of the fund. … [T]his court has never held, and Spano did not
imply, that the mere possibility that a trivial level of intra-class conflict may materialize as the litigation progresses forecloses class certification entirely. … We conclude both that
Spano poses no bar to the proposed SVF class and that the district court’s reservations about the class were unfounded.

You can view the full 7th Circuit opinion here

Bengals Cheerleader Wins Libel Suit For Online Defamation

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

Ever since the invention of the internet, it has been wreaking havoc on our Constitution’s First Amendment. People say hurtful and insulting things, particularly about people in the media, without ever considering the consequences of their words. This is especially true when people are able to make these statements anonymously. Frequently, there are no consequences but countless defamation lawsuits have been filed over things that have been said online and the decisions reached by the court are usually hotly debated. Another such case has recently emerged from a federal court in Covington, Kentucky.

The case involves Sarah Jones, a former Cincinnati Bengals cheerleader, and Nik Richie, the operator of thedirty.com, a gossip website. The jury found that posts about Jones on the website were substantially false. Additionally, the jury found that Nik Richie acted with malice or reckless disregard when he posted anonymous submissions to his website.

One such post claimed that Jones had sex with every Bengal player. Another said that she probably had two sexually transmitted diseases. In her lawsuit, Jones said that these comments were false and caused her severe mental anguish.

In his defense, Richie denied any malice in posting the comments and maintained that he was not required to fact-check anonymous submissions before posting them. David Gingras, Richie’s defense attorney, argued that Richie’s website and others like it are protected by the Communications Decency Act. That law was created in part to provide protection to website operators like Richie from liability for content which is originated by third parties.

Eric Deters, the attorney representing Jones, argued that Richie acknowledged that he screens submissions and decides which comments to post and he adds his own comments. This fact separates his website from others such as Facebook where people post their own comments without any sort of regulation.

The judge maintained that the Communications Decency Act does not protect thedirty.com in this case. The jury sided with Jones and awarded her $338,000 in damages.

As with many cases, the decision of this court could have far-reaching consequences. “I think it could put some limits on the ability of a website operator to feel free to post comments that might be offensive or controversial or even just critical,” said Jack Greiner, who specializes in media and free speech issues. “People might err on the side of caution and not take a risk, even if comments are acceptable.”

The decision reached by the judge has been highly contested. Gingras, who has won similar lawsuits, has said that, “There’s no question that his ruling is wrong”.
Nate Cardozo is a staff attorney with the Electronic Frontier Foundation, a nonprofit foundation which focuses on civil liberties and privacy issues in the digital age. He agrees with Gingras and said that the judge “got it dead wrong”. According to Cardozo, Jones could sue over the false statements, but “she can only sue the person who made the statements”. That becomes difficult however, when comments are posted anonymously, as is the case here.

Deters is happy with the verdict, saying he hopes that it will “reduce the number of defamation comments made on these types of websites.” Richie plans to appeal the ruling.

Court Dismisses ATM Fee Lawsuit Due to Prior Class Action Settlement Agreement

August 1, 2013 | Peter S. Lubin and James V. DiTommaso

An Illinois court dismissed a lawsuit against a bank alleging deceptive fees for debit card transactions, ruling that a prior settlement in a class action lawsuit, of which the plaintiff was a class member, barred the suit. Schulte v. Fifth Third Bank (“Schulte 2”), No. 09 C 6655, statement (N.D. Ill., Jun. 15, 2012). The plaintiff acknowledged being part of the class, and by accepting the terms of the settlement agreement, the court held, the plaintiff had released the bank from any further claims related to ATM fees.

The original lawsuit alleged that the defendant “resequenced” debit card transactions during a posting period in an order from highest to lowest, rather than in chronological order. Schulte v. Fifth Third Bank (“Schulte 1”), 805 F.Supp.2d 560, 565 (N.D. Ill. 2011). This meant that the balance of the customer’s account drew down faster, leading to more overdrafts and associated fees. A class action lawsuit commenced in November 2009, and the U.S. District Court for the Northern District of Illinois approved a class settlement agreement in July 2011.

The Schulte 1 settlement applied to customers of the defendant from October 21, 2004 to July 1, 2010. The court applied a five-part test established by the Seventh Circuit Court of Appeals for determining if a class action settlement is fair:

Class Certification Granted in Lawsuit Brought by Identity Theft Victim Against Credit Reporting Agency – Osada v. Experian

July 28, 2013 | Peter S. Lubin and James V. DiTommaso

A consumer sought to certify two classes in a lawsuit against a credit reporting agency, after the agency allegedly refused to remove negative information from his credit report that was the result of identity theft. The lawsuit asserted various claims under the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq. The court certified one of the two classes in Osada v. Experian Information Solutions, Inc., No. 11 C 2856, slip op. (N.D. Ill., Mar. 28, 2012), finding that it met the requirements contained in Rule 23 of the Federal Rules of Civil Procedure.

According to the court’s opinion, the plaintiff learned in late 2008 that unknown parties had taken out two mortgage loans in his name in a total amount greater than $600,000. He contacted the defendant, Experian, regarding how the fraudulent loans would affect his credit report. He also filed a police report, but did not send a copy to Experian. When each mortgage eventually went into foreclosure, the courts handling those matters reportedly realized that identity theft was a factor. The plaintiff submitted an identity theft affidavit to the Federal Trade Commission (FTC) in late 2009 and wrote to Experian in early 2010 requesting removal of the mortgages from his credit report. He attached the FTC affidavit, the police report, and proof of residence to his request.

Federal Court Dismisses Certain State Law Claims in Multidistrict Litigation Case Alleging ATM Overdraft Fee Fraud

July 26, 2013 | Peter S. Lubin and James V. DiTommaso

A federal judge denied most of a motion to dismiss brought by multiple banks in a consolidated case alleging overdraft fee fraud. In re Checking Account Overdraft Litigation, 694 F.Supp.2d 1302 (S.D. Fla. 2010). The Judicial Panel on Multidistrict Litigation (JPML) consolidated multiple claims into a single matter in the Southern District of Florida in order to deal efficiently with common pretrial matters. The plaintiffs asserted causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing (“GFFD covenant”), and many individual causes asserted common law breach of contract claims and state law consumer protection claims. The defendants filed an omnibus motion to dismiss, which the trial court granted in part and denied in larger part. The court dismissed claims under certain state consumer statutes, as well as claims based on the laws of states in which no plaintiffs lived.

The central issue of the litigation was the ordering of ATM transactions from highest to lowest, regardless of the order in which the account holder performed the transaction. This allegedly reduced the account holder’s total account balance more quickly, garnering more overdraft fees for the defendants. At the time the court rendered its order on the omnibus motion to dismiss, the litigation consisted of fifteen separate complaints, each brought against an individual bank. All of the fifteen complaints pending at the time of the court’s order involved breach of GFFD covenant claims. Five complaints were filed in California as putative class actions on behalf of California customers. Eight complaints were filed outside California, putatively on behalf of nationwide classes excluding California. One complaint was filed by a California resident and sought to represent a nationwide class. The final complaint was filed by a Washington resident on behalf of a class of Washington customers. According to the JPML, the consolidated litigation has involved one hundred separate complaints since 2009, with forty-four still involved as of March 5, 2013.

U.S. Supreme Court Rules that Arbitration Agreement Bars Class Action and Class Arbitration Claims – AmEx v. Italian Colors Restaurant

July 25, 2013 | Peter S. Lubin and James V. DiTommaso

The United States Supreme Court recently ruled that federal law does not permit a court, based on a finding that individual arbitration is cost-prohibitive for a plaintiff, to strike a class arbitration waiver clause in a contract. American Express Co., et al. v. Italians Colors Restaurant, et al (“AmEx”), 570 U.S. ___, No. 12-133, slip op. (Jun. 20, 2013). The decision builds on prior decisions that have generally affirmed the enforceability of mandatory arbitration clauses, class arbitration waivers, and class action waivers, even in contracts where the bargaining power between the parties is far from equal.

The plaintiffs in AmEx are businesses that accept payments using American Express credit cards. The contract between the plaintiffs and American Express includes clauses requiring submission of all disputes to arbitration and waiving class arbitration procedures. The plaintiffs brought a federal antitrust class action lawsuit against American Express, claiming that the company engages in various monopolistic practices. The defendant brought a motion to compel arbitration under the contract and the Federal Arbitration Act (FAA), 9 U.S.C. § 1 et seq. In response, the plaintiffs offered an economist’s declaration stating that the cost of arbitration for an individual merchant asserting a federal antitrust claim would exceed any possible recovery.