Justia Class Action Opinion Summaries

The State of Nevada filed a parens patriae lawsuit against Bank of America in Clark County District Court, alleging that the Bank misled Nevada consumers about the terms and operation of its home mortgage modification and foreclosure processes, in violation of the Nevada Deceptive Trade Practices Act, Nev. Rev. Stat. 598.0903-.0999. Nevada also alleged that the Bank violated an existing consent judgment in a prior case between Nevada and several of the Bank's subsidiaries, entered in Clark County District Court. The Bank removed the action to federal district court, asserting federal subject matter jurisdiction as either a "class action" or "mass action" under the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d), and as arising under federal law, 28 U.S.C. 1331. Denying Nevada's motion to remand, the federal district court concluded that it had jurisdiction over the action as a CAFA "class action," but not as a "mass action," and that it also had federal question jurisdiction because resolving the state claims would require an interpretation of federal law. The court concluded that because parens patriae actions were not removable under CAFA, and the action did not otherwise satisfy CAFA's "mass action" requirements, the district court lacked jurisdiction under CAFA. The court also exercised its interlocutory appellate jurisdiction under 28 U.S.C. 1453(c) to review the district court's determination that it had federal question jurisdiction because the complaint referenced the federal Home Affordable Mortgage Program and the Fair Debt Collection Practices Act (FDCP), 15 U.S.C. 1692 et seq. The court concluded that the district court lacked federal question jurisdiction. Because there was no basis for federal subject matter jurisdiction, the case was remanded to Nevada state court. View "State of Nevada v. Bank of America Corp., et al." on Justia Law

Plaintiff rented a car, drove 64 miles in one day, refilled the fuel tank, and returned the car to the same location from which he rented the car. In addition to rental and other fees that he does not dispute, he was charged a $13.99 fuel service fee that he challenged by filing a putative class action, claiming breach of contract, fraud, and unjust enrichment. Defendant claimed that, because plaintiff drove fewer than 75 miles during the rental period, to avoid the charge he was required to return the car with a full fuel tank and to submit a receipt. The district court dismissed, finding that the contract was not ambiguous. The Sixth Circuit affirmed, citing the voluntary payment doctrine.View "Salling v. Budget Rent A Car Sys., Inc." on Justia Law

Plaintiff entered into a two-year wireless service agreement with First Cellular in 2005. The company was acquired by defendant, which began dismantling and reorganizing. Plaintiff initially agreed to defendant's terms, but later filed a class action, claiming breach of contract for rendering his phone and equipment useless and refusing to honor the features and prices of the First Cellular Agreement. He also claimed deceptive rade practices under Illinois law and civil conspiracy. The district court denied defendant's motion to compel arbitration. The Seventh Circuit reversed, finding that defendant's arbitration clause applies because part of the claims are based on services and products received under defendant's contract. Defendant's contract unambiguously covers any dispute "arising out of" or "relating to the services and equipment." If a contract provides for arbitration of some issues, any doubt concerning the scope of the arbitration clause is resolved in favor of arbitration as a matter of federal law, 9 U.S.C. 2. View "Gore v. Alltel Comm'cns, LLC" on Justia Law

Robert and Janet McKeage (Relators) sued Bass Pro Outdoor World in a five-count petition for charging a document preparation fee for purchasing a boat. Relators subsequently sought class certification of both in-state and out-of-state customers based upon the purchase agreement's choice of law provision, which required the application of Missouri law to all transactions. The circuit court certified a class that was limited to contracts entered into within the state. Relators sought relief by way of a writ of prohibition. The Supreme Court granted the writ, holding that the circuit court abused its discretion by limiting the putative class members to only those whose transactions occurred in Missouri where the class of plaintiffs that Relators sought to certify was limited to those who were charged a document preparation fee and whose contracts contained the Missouri choice of law provision. View "State ex rel. McKeage v. Circuit Court (Cordonnier)" on Justia Law

Honda appealed the district court's decision to certify a nationwide class of all consumers who purchased or leased Acura RLs equipped with a Collision Mitigation Braking System (CMBS) during a 3 year period under Rule 23(b)(3). Plaintiffs alleged that certain advertisements misrepresented the characteristics of the CMBS and omitted material information on its limitations. The court held that the district court erred because it erroneously concluded that California law could be applied to the entire nationwide class, and because it erroneously concluded that all consumers who purchased or leased the Acura RL could be presumed to have relied on defendant's advertisements, which allegedly were misleading and omitted material information. Accordingly, the court vacated the class certification order. View "Mazza, et al. v. American Honda Motor Co." on Justia Law

Class actions charged defendant, a credit-reporting agency, with violating the Fair Credit Reporting Act, 15 U.S.C. 1681, by selling consumer credit information to advertisers. The actions were consolidated and settled for $75 million. Class counsel appealed approval of a settlement with members of the class who filed individual claims in state court, that allowed defendant, after paying the settlements, to be reimbursed out of the $75 million class settlement fund. The law firm (Watts) that represented the individual claimants, did nothing to create the fund out of which the settlements will be paid, but stands to receive from $10 to $15 million in attorneys’ fees out of the class settlement fund. Class counsel argued that it should receive a portion of Watts' fees on the ground that class counsel contributed to the creation of the fund. The Seventh Circuit deemed Watts' motion as one to add it as a party and granted the motion. Watts wants to be an appellee to defend its right to attorneys' fees from the fund that its clients (individual claimants) agreed to pay, according to the court, but doesn't want to be a party that could be ordered to disgorge some of the fees, should class counsel prevail. View "In re: Trans Union Corp. Privacy Litigation" on Justia Law

Plaintiffs alleged that De Beers coordinated worldwide sales of diamonds by executing agreements with competitors, setting production limits, restricting resale within regions, and directing marketing, and was able to control quantity and prices by regimenting sales to preferred wholesalers. Plaintiffs claimed violations of antitrust, consumer protection, and unjust enrichment laws, and unfair business practices and false advertising. De Beers initially refused to appear, asserting lack of personal jurisdiction, but entered into a settlement with indirect purchasers that included a stipulated injunction. De Beers agreed to jurisdiction for the purpose of fulfilling terms of the settlement and enforcement of the injunction. The district court entered an order, approving the settlement and certifying a class of Indirect Purchasers in order to distribute the settlement fund and enforce the injunction. De Beers then entered into an agreement with direct purchasers that paralleled the Indirect Purchaser Settlement. The Third Circuit remanded the certification of two nationwide settlement classes as inconsistent with the predominance inquiry mandated by FRCP 23(b)(3), but, on rehearing, vacated its order. The court then affirmed the class certifications, rejecting a claim that the court was required to ensure that each class member possesses a colorable legal claim. The settlement was fair, reasonable, and adequate. View "Sullivan v. DB Inv., Inc." on Justia Law

Plaintiff, on behalf of himself and others similarly situated, sued defendant, alleging claims under the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692g, where defendant conceded that plaintiff did not owe a certain payment obligation. The district court granted defendant's motion for summary judgment and plaintiff appealed. The court held that, although the district court erred in interpreting the FDCPA's consumer requirement, the court nonetheless affirmed the judgment. Whether plaintiff was a "consumer" was not determinative because the court found that defendant sufficiently verified the payment obligation that plaintiff allegedly owed. View "Dunham v. Portfolio Recovery Associate" on Justia Law

Defendant is a payroll processing firm that collects information about its customers' employees, which may include names, addresses, social security numbers, dates of birth, and bank account information. In 2009, defendant suffered a security breach. It is not known whether the hacker read, copied, or understood the data. Defendant sent letters to the potential identity theft victims and arranged to provide the potentially affected individuals with one year of free credit monitoring and identity theft protection. Plaintiffs, employees of a former customer filed a class action, which was dismissed for lack of standing and failure to state a claim. The Third Circuit affirmed. Allegations of hypothetical, future injury do not establish standing under the "actual case of controversy" requirement of Article III. View "Reilly v. Ceridian Corp." on Justia Law

Appellant Kia Motors America, Inc. unsuccessfully defended a class action lawsuit for breach of express warranty. It appealed a superior court's decision to affirm certification of the class by the trial court, and the amount of damages and litigation costs awarded to the class. Costs included a significant legal fee, entered pursuant to the Magnuson-Moss Warranty Improvement Act (MMWA). Appellee Shamell Samuel-Bassett, on behalf of herself and others similarly situated filed this class action lawsuit in January 2001, alleging that her Kia had an unsafe manufacturing defect in the braking system. In 2005, a jury rendered a verdict in favor of the class for breach of express warranty, and awarded damages in the amount of $600 per class member. The court molded the verdict to account for the 9,402 class members to which the parties had stipulated and recorded a $5.6 million verdict. Represented by new counsel, Kia filed an unsuccessful post-trial motion for judgment notwithstanding the verdict, or for a new trial. The issues on appeal to the Supreme Court were: (1) whether the class was properly certified; (2) whether evidence was sufficient to support the jury’s verdict and whether the verdict was against the weight of the evidence; (3) whether the jury’s verdict was properly molded to account for the 9,402 members of the class; (4) whether the trial court had authority to award attorneys’ fees after Bassett entered judgment on the class verdict; and (5) whether the risk multiplier was properly applied to an award of counsel fees under the MMWA. The Supreme Court affirmed in part, and reversed in part, the trial court's decision. The Court reversed the trial court to the extent that its order provided for enhancement of the attorneys' fees award beyond the amount permitted in the MMWA. View "Samuel-Bassett v. Kia Motors America, Inc." on Justia Law