After bassist Bob Daisley and drummer Lee Kerslake filed lawsuits demanding royalties over their performances in two Ozzy Osbourne albums, “Blizzard of Ozz” and “Diary of a Madman”, recording executives remastered the albums to strip out their performances and replace them with performances by Robert Trujillo and Mike Bordin for the 2002 reissue. Now Illinois fan Anthony Wester has sued Sony Entertainment and Epic Records, saying he felt misled and cheated to learn of the substitution, and his lawyer wants class-action status for the suit. (Steve Patterson, “‘Remastered’ Osbourne albums a snow job, fan’s suit charges”, Chicago Sun-Times, Feb. 21; “Bassist, drummer cut from Ozzy album remixes, fan sues”, AP/AZCentral.com, Feb. 23).
Posts Tagged ‘class actions’
Sugar industry vs. Splenda
Alarmed by the sweetener Splenda’s steady rise in consumer popularity and market share, organized sugar producers in December filed a California false-advertising suit against distributor McNeil Nutritionals, a unit of Johnson & Johnson. The lawsuit challenges the artificial sweetener’s slogan “made from sugar, so it tastes like sugar”, on the grounds that sucralose, the active ingredient in Splenda, is produced using chemical processes, even if sugar does happen to go into it. A number of private lawyers are pursuing similar theories in consumer lawsuits pursuing class-action status. In turn, J&J has struck back with a lawsuit against the Sugar Association and other defendants alleging a “malicious smear campaign” aimed at undercutting consumer confidence in the sweetener’s safety. (Patrick Walters, “Splenda’s maker sues sugar producers”, AP/Detroit Free Press, Feb. 9; Laura Petrecca and Holly M. Sanders, “Sweet and Low”, New York Post, Feb. 13; Claire Cummings, “Splenda sugar substitute receives praise, lawsuits from consumers”, State News (Michigan State U.), Feb. 16). Update: National Law Journal coverage of controversy (Apr. 8).
Senate passes Class Action Fairness Act
By a 72-26 vote, with 18 Democrats and Vermont’s Jeffords joining a unanimous roster of Republicans, the Senate has approved this bill, which would 1) move most interstate class actions from state into federal court and 2) regulate various practices such as the use of coupon settlements. House approval and a Presidential signature are expected in short order, giving the returning Bush administration its first major legislative victory and dealing a rare defeat to the Association of Trial Lawyers of America. Such defeats have been so rare that CAFA, though hardly radical and not a little watered down from earlier versions, probably constitutes the most ambitious tort-reform measure to pass at the federal level in recent decades. (New York Times).
For some of this site’s past posts on the bill, see Apr. 25-27, Jun. 12-15 and Jun. 25, and Sept. 28, and Oct. 21, 2003. Jim Copland and others have wall-to-wall coverage of the new developments at Point of Law, including posts on the roll call; background (including links to four past Manhattan Institute studies on the issue); the “magnet-court” problem; and last but not least, a new Manhattan Institute study by Yale law prof George Priest taking a closer look at some widely circulated statistics about class settlements, and opining that CAFA would be a useful if limited first step in addressing the problems raised by such litigation.
Elsewhere on the web, some plaintiff’s-side observers are pointing out that the new rules ushered in by the bill will likely be actively beneficial to the practice of some lawyers who specialize in filing such suits (though detrimental to others’), and that some businesses that get sued are likely to find their position worsened (not only may they find it harder to enter cheap coupon settlements, for example, but they may face a proliferation of one-state-only class actions). See, in particular, Evan Schaeffer and C. E. Petit (“Scrivener’s Error”). Meanwhile, Dwight Meredith perhaps surprisingly “do[es] not oppose the proposed reform of class action suits” but believes its GOP sponsors are being inconsistent, and Bill Childs wonders if there’s more to the debate besides money. Finally, Baseball Crank points out a possibly headache-making technical aspect of the bill.
“Attorneys Feud in AmEx Card Case”
Class action watch: “A proposed legal settlement that could deliver about $64 million to American Express cardholders and up to $11 million to plaintiffs’ lawyers is under assault from rival attorneys who say the company should be paying much more. … Those challenging the pact say American Express conducted what amounts to a ‘reverse auction’ by shopping around until the company found a group of attorneys that would accept the lowest settlement offer.” There are indications that Miami federal judge Cecilia Altonaga is giving the objections more credence than is often done: she “ruled last fall that the critics could demand documents and testimony about the claims explored by lead attorneys on the case”, which usually doesn’t happen. The lawsuits allege that Amex applied fees and unfavorable exchange rates to American cardholders’ purchases in foreign currencies. (Josh Gerstein, New York Sun, Feb. 4). Update on settlement of objections: Point of Law, Aug. 22, 2007.
Fee in Visa/MC class action, cont’d
David Giacalone has some apposite things to say (Jan. 26) about a court’s recent decision to allow a mere $220 million in fees, rather than the more than $600 million sought, to lawyers who’d represented the plaintiff class of merchants in an antitrust suit against Visa and MasterCard (see Jan. 24). In particular, he notes the claim of the class counsel (on its website) that its billing rates “are typically significantly less than those charged by larger firms”; the willingness of big-name legal academics like Arthur Miller and Jack Coffee to hire themselves out to class counsel to bless the fees; and the dubious impact on consumers of some of the injunctive relief obtained by the class (he notes that he can’t use his debit card at Wal-Mart any more).
Fee in Visa/MC class action: $220 million
Poor dears dept.: “A federal appeals court in New York has upheld the largest antitrust class action settlement in history, along with an award of $220 million to the lawyers who brought the $3 billion case against Visa and MasterCard. … The class-action attorneys argued that the $220 million in legal fees allowed by the trial court was inadequate and the legal team should have been awarded more than $600 million, but the appeals court disagreed.” (see Aug. 22, 2003, Mar. 17, 2004). (Josh Gerstein, “Court Upholds ‘Only’ $220 Million For Lawyers in Visa, MasterCard Suit”, New York Sun, Jan. 18). More on the case: Jan. 29.
Mutual funds sued
A lawyer at Baron & Budd thinks the funds’ managers should have been grabbier about money. (Jonathan D. Glater, “Suits Contend Mutual Funds Fail to Collect in Settlements”, New York Times, Jan. 19). More commentary on suit: Securities Litigation Watch, Jan. 25 (via 10-b5 Daily).
Judge blinks at cosmetics settlement
Trouble for that no-blush, high-gloss, invisible-foundation antitrust class action (see Dec. 3 and links from there): at a two-hour hearing, federal judge Saundra Armstrong declined to approve the deal in its present form, saying “she agreed with the broad outlines of the settlement but was troubled by the details of how such a large volume of free [makeup and perfume] would be distributed”. Josh Gerstein of the New York Sun has a report (“Antitrust Suit Over Pricing of Cosmetics Hits a Snag”, Jan. 12). Update Mar. 14: judge approves settlement.
WorldCom directors’ settlement
Larry Ribstein has a commentary (Jan. 6) on the just-announced WorldCom settlement, in which ten of the company’s directors, notably including prominent former Georgetown Law School dean Judith Areen, agreed to contribute $18 million from their own personal funds toward the settlement of investors’ class action claims arising from the company’s giant accounting scandal. Update Jan. 12: following closely on the heels of the WorldCom settlement, Enron directors agreed to a settlement likewise throwing personal funds into the kitty; in this case the semi-celebrity outside director who settled was Wendy Lee Gramm. Ribstein again comments.
Batch of reader letters
We’ve posted four more reader letters from our alarmingly backed-up pipeline, at our letters page. Among topics this time: Manhattan attorney Ravi Batra invites us to take a closer look at his lawsuit against the TV program “Law and Order”; can Texas exercise jurisdiction over out-of-state class action lawyers’ representation of Texas class members?; freeing innocent prisoners, and the other kind; and the continuum of disabilities.