Monthly Archives: October 2014

Recent Filings – October Digest

View Susan Huber's Complete Bio at RBH.com Not every class action court filing in North and South Carolina becomes a full-length post on our blog. Here is a recap of October’s filings:

Ringel v. Care Improvement Plus Group Management, LLC, No. 7:14-cv-04232 (D.S.C. Oct. 30, 2014) (alleging breach of contract against health care administrator on behalf of class of medical providers who had reimbursements for treating Medicare Advantage Plan recipients erroneously coded as services at skilled nursing facilities instead of services at medical practitioner’s office).

Jones v. Dancel, No. 14-2160 (4th Cir. Oct. 28, 2014) (appeal docketed from order and memorandum of the U.S. District Court for the District of Maryland denying motion to vacate, in part, arbitrator’s decision not to award actual damages to class or attorneys’ fees to class counsel in action filed for violation of Credit Repair Organizations Act).

Houser v. Syngenta, No. 3:14-cv-04163 (D.S.C. Oct. 24, 2014) (alleging Lanham Act violations, negligence and other claims for marketing and selling to farmers genetically engineered seeds for corn that was not approved for export to certain countries). This case has since been stayed pending a likely transfer, along with more than 100 similar cases filed across the country, to federal Multidistrict Litigation.

Browder v. Peninsula Grill, LLC, No. 2:14-cv-04135 (D.S.C. Oct. 23, 2014) (alleging violations of the Fair Labor Standards Act and the South Carolina Payment of Wages Act for failing to pay servers hourly wages and tip pool violations at Hank’s Seafood Restaurant in Charleston).

Rivera v. WVVA Properties, LLC, No. 2:14-cv-04138 (D.S.C. Oct. 23, 2014) (alleging violations of the Fair Labor Standards Act and the South Carolina Payment of Wages Act for failing to pay a Charleston club’s employees minimum wages and overtime pay and for making improper deductions from wages).

Hankins v. Electric-Rooterman and Handyman, Inc., No. 7:14-cv-04094 (D.S.C. Oct. 21, 2014) (alleging violations of the Fair Labor Standards Act and South Carolina Payment of Wages Act for failing to pay plumbers minimum wages and overtime pay and for making improper deductions from wages).

Calderon v. GEICO General Ins., Co., No. 14-2111 (4th Cir. Oct. 16, 2014) (appeal docketed from order and memorandum of the U.S. District Court for the District of Maryland granting plaintiffs summary judgment on liability in class action for GEICO’s misclassification of investigators as exempt from overtime under the Fair Labor Standards Act).

Berry v. Hardway Objectors, No. 14-2101 (4th Cir. Oct. 15, 2014) (appeal docketed from order by the U.S. District Court for the Eastern District of Virginia approving a 200 million member, nationwide class action settlement with Reed Elsevier Inc. for selling certain Accurint brand reports to debt collectors without treating them as consumer reports under the Fair Credit Reporting Act). We previously reported on Adam Schulman’s and the Aaron Objectors’ (see below) appeals, and these appeals have been consolidated.

Watkins v. Courtney Bay Seafood Restaurant & Lounge, LLC, No. 2:14-cv-03976 (D.S.C. Oct. 13, 2014) (alleging violations of the Federal Labor Standards Act and the South Carolina Payment of Wages Act for failing to pay servers hourly wages and tip pool violations at the restaurant’s Yemassee and Walterboro locations).

Adesina v. ACN, Inc., No. 3:14-cv-00562 (W.D.N.C. Oct. 10, 2014) (alleging fraudulent and deceptive sales statements regarding Xoom Energy’s variable rate plans). For more information, see our recent post on this case.

T.M. v. Haley, No. 3:14-cv-03933 (D.S.C. Oct. 9, 2014) (alleging Constitutional violations of foster children’s rights to a safe and secure foster placement and to basic medical treatment; case brought on behalf of a purported class of all foster children in the care of the South Carolina Department of Social Services who have been sexually abused, physically abused, or severely neglected prior to or while in the care of SCDSS).

Keith Bunch Assocs., LLC v. La-Z-Boy Inc., No. 1:14-cv-00850 (M.D.N.C. Oct. 7, 2014) (alleging violations of the Telephone Consumer Protection Act, as amended by the Junk Fax Prevention Act, for sending unsolicited facsimiles). Plaintiff also filed a motion to certify the purported nationwide class and a brief in support thereof “to prevent the defendants from ‘picking off’ the named plaintiff with an offer of individual judgment under Fed. R. Civ. P. 68 in an attempt to moot the case.”

Berry v. Aaron Objectors, No. 14-2050 (4th Cir. Oct. 6, 2014) (appeal docketed from order by the U.S. District Court for the Eastern District of Virginia approving a 200 million member, nationwide class action settlement with Reed Elsevier Inc. for selling certain Accurint brand reports to debt collectors without treating them as consumer reports under the Fair Credit Reporting Act). We previously reported on Adam Schulman’s appeal.

McClaran v. Carolina Ale House Operating Co., No. 3:14-cv-03884 (D.S.C. Oct. 3, 2014) (collective action under the Fair Labor Standards Act alleging unpaid minimum wages based on tip credit violations in Carolina Ale House restaurants across the Southeast).

Saltzman v. Pella Corp., No. 2:14-cv-03885 (D.S.C. Oct. 3, 2014) (case transferred to MDL from U.S. District Court for the Northern District of Illinois).

Fitzhenry v. Lily Mgmt. and Mktg. Co., No. 2:14-cv-03866 (D.S.C. Oct. 3, 2014) (alleging violations of the Telephone Consumer Protection Act for autodialed and prerecorded messages soliciting vacation stays at Westgate Resorts, Ltd. properties).

Matthews v. Guthy Renker Fulfillment Servs., LLC., No. 3:14-cv-00547 (W.D.N.C. Oct. 3, 2014) (collective and class action lawsuit alleging violations of the Fair Labor Standards Act and North Carolina Wage and Hour Act for unpaid wages and overtime for off-the-clock time worked by home-based customer service representatives). This case has been transferred to the Asheville division under Case No. 1:14-cv-00260.

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Jurisdiction is Just the First Challenge for Fraud-Based State-Law Class Action in Federal Court

View Sinéad O’Doherty’s Complete Bio at RBH.comThe recently filed case of Adesina v. ACN, Inc. (W.D.N.C. Oct. 10, 2014) illustrates both the possibilities and the problems associated with federal litigation of putative class actions arising under state law. Prior to the adoption of the Class Action Fairness Act of 2005 (the “CAFA”), parties seeking a federal forum often had difficulty meeting the “amount in controversy” requirement in class actions brought under diversity jurisdiction. See Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546 (2005) (concluding that a least one plaintiff must satisfy the jurisdictional amount). Under CAFA, however, federal jurisdiction exists in a class action if any member of the class is diverse from any defendant and the aggregate amount in controversy exceeds $5 million. See 28 U.S.C. § 1332(d).

In Adesina, a Maryland resident brought a putative class action against two North Carolina companies, ACN, Inc. and XOOM Energy, LLC, on behalf of residents in eighteen states. (Interestingly, even though the defendants are local, the purported class does not include North Carolinians.) The complaint maintains that there are more than 100 class members who are diverse from the defendants and whose aggregate damages exceed $5 million. This seems enough to check the CAFA jurisdiction box.

But CAFA only gets you into federal court, and then Federal Rule of Civil Procedure 23 governs whether a class may in fact proceed. Claiming that the defendants are engaged in a “fraudulent and deceptive bait-and-switch sales model,” the complaint asserts a variety of fraud-based claims, including violation of the North Carolina Unfair and Deceptive Trade Practices Act. And although pleading a multiplicity of state-law claims, the complaint appears to rest in large part upon ostensibly misleading statements that sales agents are making in the field to try to get customers to switch providers. Yet Fourth Circuit precedent is clear that generally “the reliance element of . . . fraud and negligent misrepresentation claims [is] not readily susceptible to class-wide proof” and “proof of reasonable reliance . . . depend[s] upon a fact-intensive inquiry into what information each [class member] actually had.” Broussard v. Meineke Discount Muffler Shops, Inc., 155 F.3d 331, 341 (4th Cir. 1998). If that weren’t challenging enough, the Fourth Circuit has already indicated that class claims involving marketing practices of multiple sales agents typically don’t fare well. See Gunnells v. Healthplan Servs., Inc., 348 F.3d 417, 434 (4th Cir. 2003) (reversing class certification of claims against individual agents).

Judge Mullen will have to decide whether these cautionary principles preclude certification of a class here, but from this vantage point, it looks like the Adesina plaintiff will have an uphill battle.

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Class Certification Question Headed to NC Supreme Court

View David Wright's Complete Bio at RBH.comIn a previous post, we reported on Judge Jolly’s certification of a class of tobacco farmers suing a tobacco marketing cooperative in a Rule 2.1 case. The defendants have since appealed Judge Jolly’s decision to the North Carolina Court of Appeals.

On October 10, the North Carolina Supreme Court took the unusual step of certifying the case for review decision by the Court of Appeals. In fact, the case was not even fully briefed in the Court of Appeals. The case was part of a group of civil cases that the Supreme Court took from the Court of Appeals, as reported by the Raleigh News & Observer.

Stay tuned.

(John Wester of our firm filed an amicus motion and brief in support of the appellants on behalf of the NC Chamber in this case.)

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Recent Filings – September Digest

View Susan Huber's Complete Bio at RBH.com Not every class action court filing in North and South Carolina becomes a full-length post on our blog. Here is a recap of September’s filings:

CFRE, LLC v. Adkins, No. 8:14-cv-03825 (D.S.C. Sept. 30, 2014) (alleging due process and other constitutional violations for unlawful property assessments in 2010; purported class includes all owners of Greenville County property during the 2010 assessment).

Berry v. Schulman, No. 14-2006 (4th Cir. Sept. 24, 2014) (notice of appeal by interested party Adam Schulman of the order and memorandum opinion approving a 200 million member, nationwide class action settlement for alleged violations of the Fair Credit Reporting Act by Reed Elsevier Inc. and two of its LexisNexis companies for selling certain Accurint brand reports to debt collectors without treating them as consumer reports under the FCRA). Schulman, an attorney for the Center for Class Action Fairness appearing pro se, made objections and supplemental objections to the settlement before the U.S District Court for the Eastern District of Virginia, all of which were overruled.

Caskie v. Nason Medical Ctr., LLC, No. 2:14-cv-03768 (D.S.C. Sept. 24, 2014) (removal of collective action alleging violations of the Fair Labor Standards Act and South Carolina Payment of Wages Act for failure to pay overtime and wages for all hours worked to physician assistants at five urgent care centers in the Charleston area). This case was originally filed in the Charleston County Court of Common Pleas on September 2, 2014.

Cohan v. Pella Corp., No. 2:14-cv-03704 (D.S.C. Sept. 19, 2014) (case transferred to MDL from U.S. District Court for the District of Maine).

Fitzhenry v. Indep. Order of Foresters, No. 2:14-cv-03690 (D.S.C. Sept. 18, 2014) (alleging violations of the Telephone Consumer Protection Act for prerecorded marketing calls related to funeral insurance). A motion to certify the nationwide class was filed with the complaint.

Palacios v. Pella Corp., No. 2:14-cv-03637 (D.S.C. Sept. 12, 2014) (case transferred to MDL from U.S. District Court for the Eastern District of Louisiana).

Fejzulai v. Sam’s West Inc., No. 6:14-cv-03601 (D.S.C. Sept. 10, 2014) (alleging Sam’s Club failed to issue double refunds to a purported nationwide class of the discount membership club’s members for the return of fresh meat, bakery and produce items pursuant to their “200% Freshness Guarantee” and terms of membership).

Watson v. McDonald, No. 3:14-cv-03594 (D.S.C. Sept. 9, 2014) (alleging violations of the Administrative Procedure Act and Privacy Act after Veteran Affairs lost four boxes of pathology reports containing private personal and medical information, including social security numbers, of at least 2, 179 veterans who had received medical treatment in South Carolina ).

Elmquist v. Flo-Pie Inc., No. 4:14-cv-03548 (D.S.C. Sept. 4, 2014) (collective action under the Fair Labor Standards Act alleging minimum wage and overtime violations based, in part, on tip sharing violations in three Mellow Mushroom restaurants in Florence and Horry Counties).

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