Consumer Advocate Legal Update : Class Action Lawyers & Attorneys : Khorrami Pollard & Abir Law Firm : Mass Torts, Products Liability

For years, there has been a split in authority over the definition of “unfair” in consumer actions brought under California’s Unfair Competition Laws (“UCL”). Recently, the Court of Appeal (Second Appellate District, Division Three) discussed this split of authority in detail, and adopted a third formulation for the definition. Davis v. Ford Motor Credit Co., ___ Cal.App.4th ___, 2009 WL 3859327 (Nov. 19, 2009).

The UCL establishes three types of unfair competition – unlawful, fraudulent and unfair. (See Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163, 180 (Cel-Tech). However, the UCL language is in the disjunctive, so that “a practice is prohibited as ‘unfair’ or ‘deceptive’ even if not ‘unlawful’ and vice versa.” (Cel-Tech, supra, 20 Cal.4th at p. 180.)

Defining the definition of the term "unfair” has remained unresolved as applies to consumer suits. While courts have created different balancing tests for unfair competition claims by competitors alleging anticompetitive practices, they have specifically excluded consumer actions from the reach of these tests. Cel-Tech, supra at 187, fn. 12. Until Davis, there were two main tests applicable to the definition of the term “unfair”.

Davis applied a third test to consumer actions that was first established in Camacho v. Automobile Club of Southern California, 142 Cal.App.4th 1394 (2006) (Second Appellate District, Division Eight). The Davis court held that Defendant’s demurrer was properly sustained without leave to amend because, as a matter of law, plaintiff could not satisfy the Camacho test. Slip op. at 19-20. The most significant barrier was the requirement of "an injury that consumers themselves could not reasonably have avoided." Id. at 19 (citing Camacho). The court determined that Davis could have avoided the injury alleged, i.e. the imposition of late fees, by making timely payments to his auto loan despite the fact that plaintiff alleged that defendant’s interpretation of the contracts and method of applying payments to the load allowed defendant to assess multiple late fee charges for a single late payment.

Before Davis, very few courts followed the Camacho analysis. In fact, many have explicitly declined to follow it. See, e.g., Lozano v. AT&T Wireless Services, Inc., 504 F.3d 718 (9th Cir. 2007); Overstock.com v. Gradient Analytics, Inc., 151 Cal.App.4th 688, 715 (2007). The Supreme Court, however denied the petition for rehearing on December 8, 2009, leaving the question unresolved of what “unfair” means under the UCL in consumer cases.
 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Much of wage and hour class action litigation has concerned claims alleging that a group of employees is misclassified as exempt employees resulting in the employees not being paid overtime or subject to State meal and rest break requirements. Most of this litigation concerned claims involving the Executive and Administrative exemptions. Today, however, we see an increasing amount of litigation involving claims that workers have been misclassified as independent contractors when, in fact, they are employees. The rise in such claims is not surprising given the poor economic conditions over the past few years. Employers are under constant pressure to minimize labor costs. By treating a group of workers as independent contractors, companies save hundreds of thousands or, perhaps, millions of dollars because they no longer reimburse workers for out of pocket expenses necessary to perform the work and don’t pay overtime. Additionally, by treating these workers as independent contractors, corporations save by not having to pay ever-increasing costs of employee benefits, including health insurance and retirement benefits. But, the company sometime gets the independent contractor classification wrong.

When assessing whether workers are properly classified as independent contractors one must examine the applicable state of federal law. Most state law, including California, follows traditional agency law that focuses on the principal’s right to control the manner and means of accomplishing the workers desired result. Under this test, “if the employer has the authority to exercise complete control, whether or not that right is exercised with respect to all details an employer-employee relationship exists.” Empire Star Mines Co. v Cal. Emp. Com. 28 Cal. 2d 33, 43 (1946). Although the right to control remains a significant factor, a mulit-factor analysis is also utilized with the following issues considered: whether the person performing the services is engaged in an occupation or business distinct from the principal; whether or not the work is a part of the regular business of the principal; whether the principal or the worker supplies the instrumentalities and tools of work; the workers investment in the equipment or materials required by his task; the skill required of the particular occupation and whether it is usually done without supervision; the workers opportunity for profit or loss depending on his managerial skill; the duration of work and degree of permanence; the method of payment whether by time or on the job; and whether the parties believe they are creating an employee-employer relationship. S.G. Borrello & Sons, Inc. v Dept of Industrial Relations, 48 Cal. 3d 341 (1989). Virtually all contracts will designate the worker as an independent contractor and contain boilerplate language purporting to give the worker the right to control their work. However, the title of independent contractor does not govern but rather the true nature of the relationship controls.

Claims brought under the Fair Labor Standards Act (FLSA) apply a slightly different test. The definition of employee under the FLSA is particularly broad. See Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 326 (1992) (noting that the FLSA “stretches the meaning of ‘employee’ to cover some parties who might not qualify as such under a strict application of traditional agency law principles”).To determine if a worker qualifies as an employee, the focus is on whether, as a matter of economic reality, the worker is economically dependent upon the alleged employer or is instead in business for himself. Herman v. Express Sixty-Minutes Delivery Serv., Inc., 161 F.3d 299, 303 (5th Cir. 1998). To aid in this inquiry, five non-exhaustive factors are considered: (1) the degree of control exercised by the alleged employer; (2) the extent of the relative investments of the worker and the alleged employer; (3) the degree to which the worker’s opportunity for profit or loss is determined by the alleged employer; (4) the skill and initiative required in performing the job; and (5) the permanency of the relationship. Id. No single factor is determinative. Brock v. Mr. W Fireworks, Inc., 814 F.2d 1042, 1043–44 (5th Cir. 1987). Rather, each factor is a tool used to gauge the economic dependence of the alleged employee, and each must be applied with this ultimate concept in mind. Id.

Therefore, it is critical for workers in an independent contractor arrangement to be alert that they may be employees under the law and entitled to protections afforded under the labor laws and to the same benefits that a principal affords its employees. Workers should not be fooled by boilerplate language in their contract but rather keep in mind the ways the principal has the right to control their work.
 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

• Email This
• Print
• Comments
• Trackbacks
• Share Link

In October 2009, shortly after TD Banknorth changed its name to TD Bank - "America’s Most Convenient Bank" - there were apparently some major IT glitches that resulted in many customers having difficulties with their direct deposits and viewing real-time account balances. As a result, many customers were charged overdraft fees through no fault of their own. It was at this time, while viewing numerous overdraft fees on their statements, that the public became more aware of a little known banking trick. When there are several current debits to an account, many banks, not just TD Bank, apply the debits in reverse order of their value and not the chronological order that they were posted to the account. Therefore, no matter the order received, the largest current debit is applied to the balance FIRST, then the second largest debit, third largest debit and so forth. This is important because, if for some reason that largest debit makes you go over your balance, you are then charged overdraft fees for every other debit – even if the remainder of the debits would have been covered by your initial balance. (read this customer's complaint.)

For example, on one date this past fall, a TD Bank customer had approximately $2500 in a checking account and had previously scheduled electronic payments in the amounts of $12, $300 and $2700. Additionally, on that day, two checks written for $20 were presented for payment and $200 in cash was withdrawn at an actual bank location. As bank policy is to apply the largest debits first, TD Bank applied the $2700 electronic payment first, thereby overdrafting the account of $2500. This resulted in the first of six $35 overdraft fees totaling $210 - only one of which was actually greater than the balance of $2500 and three of which were actually less than the $35 penalty. However, had TD Bank applied the lesser debits first, the account would only have been overdrawn for one transaction (notwithstanding the questionable banking practice of charging the $35 overdraft fee in the first place - without any consent from the customer to engage in this practice.)

Based on this system of accounting, excessive bank overdraft fee lawsuits have been filed against numerous banks, including Wells Fargo, Bank of America, M&T Bank and Wachovia. The lawsuits allege that these banks have used unethical practices to send bank accounts into overdraft mode. More specifically, the lawsuits allege that the reordering of credits and debits so that customers are forced into unwarranted overdraft fees is outrageous. Further complicating the issues with this practice is that bank customers have never actually requested any type of overdraft protection.

Legislation currently under consideration in Congress would prohibit banks from levying more than one overdraft fee per month or six per year. According to a Bill under consideration in the House, overdraft fees would be subject to the Truth in Lending Act, requiring consumers' permission before enrolling them. Further, it would prohibit rearranging the order in which transactions are posted, which can trigger an overdraft, and it would require fees to be in proportion to the amount overdrawn (i.e. a $5 purchase could not have a $35 fee).

This proposed legislation could save each bank customer hundreds of dollars, and prevent banks from preying on these unsuspecting customers to the tune of millions of dollars each year.

If you have been the victim of these deceptive bank practices, please do not hesitate to contact us.

• Email This
• Print
• Comments (2)
• Trackbacks
• Share Link

On my way to work today I was listening to my usual talk radio show and a male caller called in asking about menopause. He basically wanted to learn more about it because his wife was going through it and he knew nothing about it except that it was a “medical condition”. This comment bothered me, not so much because I am a women and defensive about the topic, but because it mirrored the opinion of pharmaceutical companies, that for years made a fortune on hormone therapy drugs convincing people of just that…….that menopause was a condition that must be treated.

Recent articles in the New York Times and Huffington Post paint the picture of how Wyeth lured women into taking their hormone drugs, not only to retain their femininity, but to prevent heart disease, Alzheimer’s and dementia. Feel like a woman while warding off evil ailments, what woman would say no to that? They turned menopause into a disease that had to be treated. Women who every month would curse the day their menstrual cycle began were now dreading the day that it would end.

I must say Wyeth did a good job creating and spreading their image of menopause. Hopefully, the negative image will be replaced with what menopause really is…….a natural biological process, nothing more, nothing less. Until then, I guess I will just wait for my impending “medical condition” to kick in.
 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Putting its values in action is central to what makes Khorrami Pollard & Abir unique and successful as a plaintiff firm. “An essential part of our values as a firm is meaningful engagement in issues important to our firm and our profession,” says KPA founding partner Shawn Khorrami.

Press releases issued today illustrate the firm’s commitment to essential social services, and to professional development for women in plaintiff law.

Shawn Khorrami, founding partner of the firm, has been elected to the Board of Directors of AIDS Project Los Angeles (APLA), one of the largest non-profit AIDS service organizations in the country. His dedication to promoting public health and welfare is apparent not only through this accomplishment, but through his firm’s continued successes over large pharmaceutical companies who have wrongfully injured individuals across the country.

Bahar Dejban, an associate at the firm, has been named to the Board of Governors of the New Lawyers Division of the American Association for Justice (AAJ). Her dedication and role as a leader within AAJ has set precedent for other plaintiff attorneys across the country.
 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

It seems that a devastating event that at one time could have quickly been classified as a natural disaster can no longer be as easily identified. A closer look at one of the most devastating events in US history, Hurricane Katrina, reveals the contribution of outside factors in this disaster. Courts have been evaluating the viability of claims involving these outside factors and recent decisions are giving Katrina victims hope of some sort of compensation for their losses and bring attention to the devastation of “man made” disasters.

On October 16, 2009, the 5th Circuit in New Orleans ruled that residents and landowners along the Mississippi Gulf Coast have standing to sue various oil and coal companies for emitting greenhouse gas emissions which contribute to global warming, which in turn, contributed to Hurricane Katrina’s ferocity. These plaintiffs are now permitted to bring forward their claims against oil and coal companies for the losses they suffered during Hurricane Katrina. Although far from a resolution, this decision represents corporate accountability and gives Katrina victims one avenue to recover for their losses.

In addition to giving Katrina victims standing to bring certain claims, Judge Duval went a step further in his decision on November 18, 2009, where he found that the United States Army Corps of Engineer’s failure to maintain and operate the Mississippi River Gulf Outlet properly was a substantial cause of the levee breaches. In that decision, Judge Duval decided that the Corps demonstrated negligence and indifference, and that despite the opportunity to fix the levees on numerous occasions, they failed to do so. The Judge’s decision rejected the government’s immunity arguments and opens the door for judgments for thousands of other residents who were in the area covered by this decision.

Reading these decisions it is hard not to think what would have happened in August of 2005 if the destruction of Hurricane Katrina could just have been limited to that of a natural disaster instead of a man-made one.
 

• Email This
• Print
• Comments (2)
• Trackbacks
• Share Link

Current and past Rite Aid Pharmacy employees might be owed unpaid wages if they:

• Worked off the clock, or
• Were classified as an exempt manager or assistant manager and performed primarily non-managerial duties.

All employees have enforceable rights and deserve to be paid fairly.

KPA CAN HELP.

If you, members of your family, or friends might have a claim, contact us for a free consultation.

Khorrami Pollard & Abir LLP, one of the largest plaintiff-only firms in the nation, represents individuals in a variety of cases including class actions, pharmaceuticals, product liability, natural disasters, toxic torts, and labor and employment matters.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

View the AAJ Women Trial Lawyers Caucus Newsletter here, and read Bahar Dejban's complete article "The Legal Profession as I Now Know It" on page 11.

• Email This
• Print
• Comments
• Trackbacks
• Share Link

Consumers have paid upwards of $100 for cables whose performance is equal to a standard $10 six-foot HDMI cable. Many electronic stores and manufacturers have made claims that these “premium” cables outperform standard cables. However, many well respected third party reviewers, such as cnet.com contend that this isn’t necessarily the case. “Do you really need to spend that much money on a single HDMI cable? Absolutely not – those cables are a rip-off” says CNET. “And despite what salesman and manufacturers might tell you, there’s no meaningful difference between the $10 cable and the $50 cable.”

Cases where consumers have been mislead about the quality of the cables, and extreme up-selling has also been happening more frequently than not. According to engadgethd.com “Upon further inspection, he realized that the difference in picture quality wasn't due to the gold-plating or fancy braiding, but rather the use of composite cables on the non-Monster TV.” And according to gizmodo.com “While Monster cables are of good quality and engineering, when it comes to digital signals, specifically HDMI cables, we know that its a better idea to buy a $5 dollar HDMI cable today, and then when bandwidth requirements go up in future specs of HDMI, just buy another $5 cable then. It's a lot cheaper than $100 HDMI cables from Monster.”

If you have experienced any of these practices, contact us immediately. Practices such as these are misleading to consumers and are leaving them with no choice but to pay premium prices for unnecessary high-end cables.
 

• Email This
• Print
• Comments
• Trackbacks
• Share Link

KPA Moves Forward in Complex Litigation on Behalf of Women with Breast Cancer Linked to Premarin and Prempro

Two multi-million dollar verdicts in Philadelphia last week against pharmaceutical company Wyeth, a division of Pfizer, reinforce that juries are consistently finding the company responsible for breast cancer in women who took its Premarin and Prempro hormone replacement therapy (HRT) drugs.

And just last month, a ruling from the 8th Circuit Court of Appeals confirmed that Wyeth did wrong, and that juries should be permitted to hear this evidence and determine whether the company should be punished.

In the verdicts announced last week, juries awarded Donna Kendall of Decatur, Illinois $6.3 million in compensatory and $28 million in punitive damages, and Connie Barton of Peoria, Illinois $3.7 million in compensatory and $75 million in punitive damages.

Through an ongoing federal multi-district litigation mass tort action, Wyeth still faces lawsuits from more than 10,000 women nationwide who claim that the company’s drugs caused their breast cancer. Of the 12 verdicts announced to date, plaintiffs have been awarded money in 10 of the cases. Every jury that has been permitted to deliberate on punitive damages has returned substantial awards.

To date, winning plaintiffs have been awarded a total of more than $42 million in compensatory and $165 million in punitive damages. In addition, 13 women have settled their HRT claims with Wyeth or Pfizer outside of court.

Shawn Khorrami, founding partner of KPA, is a member of the Plaintiffs’ Steering Committee for the MDL litigation team, and his firm represents around 150 individuals pursuing cases against Wyeth.

A press release on the firm’s involvement with the litigation was released today. For more information on the Barton and Kendall verdicts watch the video below.
 

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link