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Class Action Blog

Tp provide current legal information relating to class action lawsuits, including consumer fraud, consumer protection, securities and antitrust class actions

Expiration Of Prepaid Wireless Credits

By Peter N. Friedberg on

An interesting class action lawsuit was recently filed in the Superior Court of Justice in Ontario, Canada.  It involves the expiration of prepaid wireless balances. 

Bell Mobility, Inc., and Bell Canada Enterprises, Inc., are prepaid wireless telephone service providers in Canada, who sell their prepaid wireless telephone services under the brand names of Virgin Mobile Canada, Bell Mobility and Solo Mobile.   The recently filed lawsuit alleges that Bells’ customers are not required to sign a long term contract and do not need to possess a credit card or a bank account, and as a result are what Bell characterizes as “lower-value subscribers” such as young people and persons with low income.  In order to obtain the prepaid wireless service, the customers only need to acquire a mobile telephone that is compatible with Bell’s network and purchase prepaid credits which may be applied to various Bell services, including voice minutes, text messages, data usage and other products.  Each customer has a credit balance reflecting the amount of credit available to use the services.  The credit balance can be increased or, “topped up”, when a customer makes a manual prepayment for the services.  The lawsuit alleges that the credit balances are subject to expiration dates, after which Bell claims that it is entitled to take any unused credit balances back from the customers. 

What the lawsuit alleges is that the value that the customers deposit into their prepaid accounts become non-refundable and will expire after a specified time period.  Although the contractual terms disclose this, the lawsuit is based upon the allegation that the purchase of credit balances are considered to be “gift card agreements” within the meaning of an Ontario regulation which states that a company cannot enter into a gift card agreement with a customer that has an expiration date on future performance of the agreement.  The lawsuit thus alleges that by purchasing prepaid wireless services, the customers are purchasing gift cards, which, pursuant to the regulation, cannot have an expiration date.

Some states in the United States also have laws that prohibit gift cards from having expiration dates.  Whether prepaid wireless services would fall within the definition of a gift card within the meaning of the State statutes is not certain, but customers of prepaid wireless services who lose their credits because of an expiration date may have an argument that it is an unlawful business practice to expire prepaid wireless services.

Political Opinion Poll Or Unsolicited Sales Call?

By James R. Denlea on

“Political Opinions of America” is supposedly a service for polling and gathering information from consumers on subjects such as the economy or President Obama’s job performance.  However, Fox News has reported that the calls are disguised as unsolicited sales calls.  A consumer is contacted by telephone and is asked a few questions about political issues.  After answering the “political” questions, the consumer is then transferred to a live operator, who offers the consumer a free cruise for up to four guests.  The consumer is asked for a required $60 per person “port fee” on a credit card to secure the “free” cruise, which is really a scheme for a sales pitch for purchasing vacation timeshares.     

Even though The Berkley Group (based in Florida), who is behind this campaign, feels it is doing nothing illegal, the Federal Trade Commission (“FTC”) is urging consumers, who receive these types of calls to file a complaint at donotcall.gov or to call (888) 382-1222.  According to the FTC, if the purpose of the call is to sell something, then the call is considered an unsolicited sales call and is in violation of the FTC’s Do Not Call Registry, which bans unsolicited telemarketing calls to any number listed on the Registry. 

If you (or someone you know) have received any unsolicited call that turns into a “sales” pitch for a service or product, please contact us to discuss your legal options.

Rental Car Companies Deceptively Charge Undisclosed EZ-Pass Fees

By Greg Blankinship on

One of the most frustrating aspects for any traveler, whether on vacation or business, is long lines at highway tolls.  To reduce toll wait times, many states have electronic passes such as EZ Pass in New York and Sun Pass in Florida that allow drivers to pass quickly through tolls, often without stopping.  As an apparent convenience, almost all rental car companies include an “e-toll” transponder so that customers can avoid the slower cash-only toll lanes.  Unfortunately, many of the rental car companies may be deceptively charging a hidden fee for customers that go through tolls, above and beyond what the actual tolls charges.

While it is true that some responsible rental car companies disclose the fee (which is typically $3 dollars a day or more) either at the rental counter or on the “e-toll” transponder itself, many do not.  When consumers make internet or phone reservations, there is no disclosure about any additional fee.  Moreover, the charge is easy to miss because it does not appear on customer receipts provided when cars are returned, but are instead charged days or weeks later (along with the toll charges) to the credit card used to make the reservation.  Not surprisingly, many consumers miss these small charges.  What makes this practice most egregious is that there are many locations that do not require any affirmative act by the customer to select or opt-in to the e-toll program, and so the charges appear with no disclosure at all.

 Meiselman, Denlea, Packman, Carton & Eberz P.C. is actively investigating a potential class action to recover these deceptively charged e-toll fees.  If you or anyone you know has rented a car and used an e-toll, EZ Pass, Sun Pass or any other electronic toll system and were charged a fee above the actual tolls, please contact us to discuss your legal options.

 

JP Morgan Chase Announces Huge Loss

By James R. Denlea on

JP Morgan Chase announced on Thursday, May 10, after the close of the market, that the bank lost $2 billion in trading.  The bank lost the money in a trading group, whose purpose was to supervise the risks the bank takes with its own money.  JP Morgan Chase is the largest bank in America and a bank that survived the financial crisis, when other financial institutions on Wall Street failed, such as Lehman Brothers and Bear Stearns.  Jamie Dimon, Chairman and CEO, has stated that the strategy of the bank to monitor the money was “egregious”, with “many errors, sloppiness and bad judgment.”   Dimon has been an opponent of efforts to regulate the financial industry more heavily.

Barney Frank, the Democratic leader of the House Financial Services Committee stated that, “JP Morgan Chase, entirely without any help from the government has lost, in this one set of transactions, five times the amount they claim financial regulation is costing them.” 

JP Morgan’s announcement and loss raises worries about other big banking institutions and the effect these “sloppiness and bad judgment” errors will have on the American (even the world) economy in the future.

Opening Ceremony Security Breach

By James R. Denlea on

According to BankInfoSecurity, Carol Lim, CEO of Opening Ceremony (a global online boutique based in New York), has announced that between February 16 and March 21, 2012, customers, who purchased products online have had details of their credit card information hacked.  Ms. Lim states in a May 4 letter to customers, “Unfortunately, the hacker may have accessed the names, addresses, and credit card information of customers who purchased an item on our website during this period.” 

The letter also warns customers to “. . . be aware of this situation and take steps to protect yourself from any harm, including contacting your bank and/or credit card company”.  However, no other details about the breach have been disclosed, including the number of exposed accounts or how the breach occurred.

 If you or someone you know purchased products online from Opening Ceremony between February 16 and March 21, 2012, your credit card information may have been compromised.  Please call us to discuss your legal options.

Warehouse Workers Not Paid Minimum Wage Or Overtime

By James R. Denlea on

Warehouse workers perform a variety of duties, including operating heavy equipment, packing products for shipment, receiving merchandise, stacking product on shelves, carts and trucks, even doing an inventory once or twice during the year.  The work can be inside or outside, making it very hot in the summer and cold in the winter for workers.  Many warehouse workers are not receiving fair wages or benefits, as well as working in poor conditions.

According to the Fair Labor Standards Act (FLSA), a warehouse worker’s job is classified as non-exempt.  This classification means that the warehouse worker is entitled to receive minimum wage and overtime pay of one and one-half times the regular rate of pay for hours worked over 40 hours in one work week.

However, this law is being ignored by staffing companies (Schneider Logistics, Eclipse Advantage, Midwest Temp Corporation) who are used by large businesses (Wal-Mart, Target, Home Depot) to employ warehouse workers.  The staffing companies (or sub-contractors) have been paying warehouse workers on the piece-rate system, which falls below the minimum wage required by law, and have been ignoring overtime hours worked.  This is called “wage theft”. 

If you, or someone you know, have been denied minimum wage or overtime pay, please contact us to discuss your legal options.

Employers May Misclassify Administrative Exempt Employees

By James R. Denlea on

The Fair Labor Standards Act (FLSA) classifies employees according to their specific job duties and salary range.  Employees who are classified as “exempt” usually perform jobs that are described as more administrative or intellectual.   An exempt employee does not receive overtime pay for hours that are worked above a 40-hour work week.  However, many employers are not classifying all exempt employees correctly, which results in employees not being paid fairly or according to the overtime rules of the FLSA.    

The FLSA has specific guidelines for classifying “administrative exempt” employees, as follows:

1.         Compensation is based on a rate of not less than $455 per week (in New York  State the weekly pay rate is $543.75);

2.         Job duties primarily consist of office or non-manual work directly related to the    management or general business activities of the employer or employer’s customers; and

3.         The use of discretion and judgment on a regular basis in matters of significance to the business.

An employer who classifies an employee in an administrative exempt capacity, but the position does not meet the above criteria, is in violation of the FLSA law.  

If you, or someone you know, have been classified as an administrative exempt employee, but the guidelines for administrative exempt are not being met, please contact us to discuss your legal options.

FDA Issues Warning About Safety Of DMAA

By James R. Denlea on

DMAA (1, 3 Dimethylamylamine) is marketed as a natural stimulant in dietary supplements, but in a recent report by the FDA, warning letters have been issued to ten manufacturers and distributors of dietary supplements containing DMAA.  The warning letters explain that DMAA  may be produced synthetically, and, as such, the FDA does not consider DMAA a dietary ingredient (such as vitamins or minerals).  According to an FDA statement, “DMAA is known to narrow the blood vessels and arteries, which can elevate blood pressure and may lead to cardiovascular events ranging from shortness of breath and tightening in the chest, to heart attack.”  While there are no specific reports of adverse reactions that can be traced to products containing DMAA, there are reports of nervous system and cardiac disorders, psychiatric disorders, and even death in people who have taken products containing DMAA.  Further, the FDA has reported that in March, two Army soldiers, who reportedly took DMAA products, died unexpectedly during fitness exercises.

A list of manufacturers/distributors, who have received the FDA warning letter are:

  •  Exclusive Supplements (Biorhythm SSIN  Juice)
  • Fahrenheit Nutrition (Lean Efx
  • Gaspari Nutrition (Spirodex)
  • iSatori Global Technologies, LLC (PWR)
  • Muscle Warfare, Inc. (Napalm)
  • MuscleMeds Performance Technologies (Code Red)
  • Mutrex Research (Hemo Rage Black, Lipo-6 Black Ultra Concentrate, Lipo-6 Black, Lipo-6 Black Hers Ultra Concentrate, and Lipo-6 Black Hers)
  • SEI Pharmaceuticals (MethylHex 4,2)
  • SNI LLC (Nitric Blast)
  • USP Labs, LLC (Oxy Elite Pro Jack3D)

If you, or someone you know, have taken DMAA products and have experienced an adverse reaction described above, please call us to discuss your legal options.

Federal Court Sustains Consumer Fraud, Class Action Claims

By Greg Blankinship on

In October 2011, Meiselman, Denlea, Packman, Carton & Eberz P.C. filed a consumer fraud class action complaint in the Federal District Court for the Southern District of New York on behalf of all New York consumers who purchased their retail electricity from the independent energy supplier, Energy Plus Holdings LLC.  The Complaint alleges that Energy Plus deceptively lures consumers into purchasing their electricity supply by promising frequent flier rewards or cash back.  The suit also alleges that notwithstanding Energy Plus’ representation that its rates are competitive and reflective of market prices, Energy Plus charges exorbitant rates for its electricity, sometimes more than two to three times the rate local utilities charge.  For everyday consumers, having to pay an electricity bill that is hundreds of dollars more than it should be can be financially devastating.

Energy Plus sought to have the suit dismissed, arguing that its statements regarding pricing were not deceptive or actionable, but merely constituted “puffery.”  Fortunately, the federal judge presiding over the action rejected that argument:

[Energy Plus’] allegedly deceptive statements plausibly may be read by a reasonable consumer as a representation that Energy Plus’ prices are at least relatively comparable both to competitors’ prices and to prevailing market rates.  Given that the Plaintiffs have alleged that Energy Plus’ rates are in fact two to three times greater and that Energy Plus’ rates rise or remain steady during some periods when market rates decline, the Plaintiffs have stated a plausible claim that the challenged statements are deceptive.  Further, Energy Plus’ failure to disclose the alleged truth about its prices plausibly renders its other statements misleading.

The case is now in discovery, as the action moves towards being certified as a class action so that the interests of all New York customers of Energy Plus can be represented in a single proceeding. 

If you or someone you know is a customer of Energy Plus in New York or elsewhere, or any other independent supplier, and you believe you may have been misled as to the price of electricity, please contact us to discuss your legal options.

Have You Been Deceived Into Changing Your Oil Too Often?

By Greg Blankinship on

One of the first things every new driver learns is the importance of regular oil changes.  In fact, failing to change your oil at appropriate intervals is likely to cause expensive damage, and as a result, many consumers are very concerned with changing their oil frequently enough.  While many consumers change their own oil, many others choose to use oil changing services like Valvoline or a Wal-Mart auto center.  Unfortunately, these companies may be taking advantage of consumers concern for ensuring proper oil changes by misinforming them as to how often such changes should be done.

While regular oil changes are important, many automakers recommended changes at as much as 10,000 miles. Parts in modern engines are engineered with finer tolerances, and improvements in gasoline quality prolong oil life. Yet many oil change services inform consumers that they should change their oil every 3000 miles.  Such a statement is false and deceptive, and causes consumers to change their oil far more often than is needed.  As a result, Meiselman, Denlea, Packman, Carton & Eberz is researching a potential consumer class action to redress such deceptive practices.

If you or anyone you know had an oil change and was told that the next oil change is due in 3000, please contact us to discuss your legal options