Articles Posted in Class Action

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Cox Cable subscribers cannot access premium cable services unless they also rent a set-top box from Cox. A class of plaintiffs in Oklahoma City sued Cox under antitrust laws, alleging Cox had illegally tied cable services to set-top-box rentals in violation of section 1 of the Sherman Act, which prohibits illegal restraints of trade. Though a jury found that Plaintiffs had proved the necessary elements to establish a tying arrangement, the district court disagreed. In granting Cox’s Fed. R. Civ. P. 50(b) motion, the court determined that Plaintiffs had offered insufficient evidence for a jury to find that Cox’s tying arrangement "foreclosed a substantial volume of commerce in Oklahoma City to other sellers or potential sellers of set-top boxes in the market for set- top boxes." After careful consideration, the Tenth Circuit ultimately agreed with the district court and affirmed. View "Healy v. Cox Communications" on Justia Law

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Several individuals in multiple states (collectively, plaintiffs) brought class action lawsuits against various fuel retailers (collectively, defendants) based on defendants’ failure to control for, or at least disclose, the effects of temperature on gasoline. In 2007, the Judicial Panel on Multidistrict Litigation consolidated these cases and designated the District of Kansas as the transferee district. After years of legal wrangling, several of the parties entered into settlement agreements, which the district court ultimately approved. These appeals arose from: (1) the district court’s approval of those settlement agreements; and (2) its interpretation of one of them. The Tenth Circuit consolidated the appeals for procedural purposes. “The settlement agreements at issue here are unusual. But the decision to approve them rests with the sound discretion of the district court. Under the unique facts of this case, we can’t say the district court abused that discretion. Accordingly, we affirm the district court’s approval of the 10 settlement agreements.” View "In re: Motor Fuel Temperature" on Justia Law

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After settlement of a class action for royalties from gas wells, the federal district court for the Western District of Oklahoma awarded attorney fees to class counsel and an incentive award to the lead plaintiff to be paid out of the common fund shared by class members. The court rejected claims by two objectors, and they appealed. Finding the district court failed to compute attorney fees under the lodestar method, as required by Oklahoma law in this diversity case, and the incentive award was unsupported by the record, the Tenth Circuit reversed and remanded. View "Chieftain Royalty v. Enervest Energy" on Justia Law

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Plaintiff-appellee Elizabeth Hammond sought to pursue a class action in New Mexico state court on behalf of everyone in the country who, like her, called to cancel their Stamps.com subscriptions after “discovering” that Stamps.com “was taking money from them” every month. Hammond alleged that this class included “hundreds or thousands of persons.” And while she didn't allege a total damages amount, she contended that she was entitled to $300 in statutory damages and that other members of the proposed class should “likely” receive damages of $31.98, representing two monthly subscription charges ($15.99 x 2), based on her estimate of how long customers could have reasonably failed to notice the monthly charges before calling to cancel. Hammond also sought punitive damages for herself and other class members. Stamps.com sought to remove the case to federal court, presenting uncontested declarations showing that in the last four years, at least 312,680 customers called to cancel their subscriptions. The company observed that, if each of these persons were to win the same $300 in damages Hammond sought for herself, the value of this case would exceed $93 million. And even if other class members could secure only $31.98 in damages, the company noted, the case’s potential value would still lie at almost $10 million. The district court found lack of jurisdiction, holding that Stamps.com failed to meet its burden of showing that over $5 million was "in controversy" because the company failed to disaggregate from the total number of customer cancellations those customers who “felt duped” by Stamps.com’s website disclosures. Disagreeing with the district court's decision it lacked jurisdiction, the Tenth Circuit reversed and remanded for further proceedings. View "Hammond v. Stamps.com" on Justia Law

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CGG Land (U.S.) Inc.’s employees (Employees) brought this collective action alleging violations of the Fair Labor Standards Act (FLSA). Employees were former hourly employees of CGG. CGG provided seismic-mapping services at remote locations throughout the United States. To reach the remote locations, CGG required employees to travel away from home and stay in hotels near remote job sites for four-to-eight-week intervals. Employees then returned home for about two-to-four week intervals before traveling again. Employees often worked more than forty hours per week while on location, and CGG paid them overtime based on Employees’ regular rates of pay. When CGG’s employees worked away from home, CGG provided them a $35 per diem for meals, including on days spent traveling to and from the remote locations. In determining Employees’ regular rates of pay, CGG didn’t include the daily $35 payments. Contesting this calculation method, Employees filed a collective action against CGG asserting that CGG violated the FLSA by calculating their overtime pay on undervalued regular rates of pay. After stipulating to material facts in the district court, the Parties each sought summary judgment. The district court granted summary judgment for CGG, agreeing with CGG that the $35 payments were exempt from the regular rates of pay under 29 U.S.C. 207(e)(2). On appeal, Employees argued that the district court erred in treating the $35 payments as exempt travel expenses under section 207(e)(2). Finding no reversible error in that determination, the Tenth Circuit affirmed summary judgment in favor of CGG. View "Sharp v. CGG Land (U.S.), Inc." on Justia Law

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Richard and Gwen Dutcher and their co-plaintiffs (collectively, “plaintiffs”) brought suit in Utah state court on behalf of a putative plaintiff class against ReconTrust, a national bank that served as the substitute trustee for class members’ deeds of trust over properties located in Utah. The suit alleged that ReconTrust illegally non-judicially foreclosed on the plaintiffs’ properties because depository institutions like ReconTrust did not have the power of sale over properties secured by trust deed. The plaintiffs also sued B.A.C. Home Loans Servicing (“BAC”) and Bank of America, N.A. (“BOA”), as the former trustees who transferred trusteeship to ReconTrust, as well as Stuart Matheson and his law firm, as the agents who conducted the foreclosure sale on behalf of ReconTrust. ReconTrust and the other defendants removed the case to federal court. They maintained that ReconTrust’s acts were lawful. The district court denied a motion by plaintiffs to remand the case to state court and agreed with ReconTrust on the merits, which led the court to grant the defendants’ pending motion to dismiss. On appeal to the Tenth Circuit Court of Appeals, plaintiffs sought reversal of the court’s order denying remand to Utah state court, and reversal of the order granting dismissal of the case. The Tenth Circuit concluded, however, that the district court properly decided that it had jurisdiction under the Class Action Fairness Act (“CAFA”); accordingly, it correctly denied the plaintiffs’ motion for remand. On the merits, the Court concluded that ReconTrust was authorized to conduct the challenged foreclosures under federal law, and the plaintiffs had relatedly failed to state a claim on which relief could be granted. The Court therefore affirmed the district court’s judgment as to both issues. View "Dutcher v. Matheson" on Justia Law

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Plaintiffs, three independent truckers representing themselves and a class of similarly situated truck drivers, contended that Defendants TransAm Trucking, Inc. and TransAm Leasing, Inc. (collectively “TransAm”) violated the Department of Transportation’s truth-in-leasing regulations by requiring the truckers to pay TransAm $15 per week to use TransAm’s satellite communications system. This $15 usage fee violated 49 C.F.R. 376.12(i), which precluded a motor carrier like TransAm from requiring a trucker “to purchase or rent any products, equipment, or services from the authorized carrier as a condition of entering into the lease arrangement.” To that end, the Tenth Circuit Court of Appeals affirmed partial summary judgment granted in favor of the truckers. However, the truckers also asserted a claim for damages, which the district court certified as a class action. Because the truckers failed to present any evidence of their damages resulting from the unlawful usage fee, the Tenth Circuit concluded the district court should have entered summary judgment for TransAm on that damages claim. View "Fox v. Transam Leasing" on Justia Law

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Plaintiffs Andrew Alwert and Stanley Feldman brought putative class actions against Cox Communications, Inc. (Cox) claiming that Cox violated antitrust law by tying its premium cable service to rental of a set-top box. The district court granted Cox’s motions to compel arbitration, then certified the orders compelling arbitration for interlocutory appeal. The Tenth Circuit granted Plaintiffs permission to appeal. They argued that the arbitration order was improper because: (1) the dispute was not within the scope of the arbitration agreement; (2) Cox waived its right to invoke arbitration; and (3) Cox’s promise to arbitrate was illusory, so the arbitration agreement was unenforceable. Finding no reversible error, the Tenth Circuit affirmed, holding that the arbitration clause in Plaintiffs’ subscriber agreements with Cox covered the underlying litigation and that Cox did not waive its right to arbitration. The Court did not resolve Plaintiffs’ argument that Cox’s promises were illusory because the argument amounted to a challenge to the contract as a whole, which was a question to be decided in arbitration. View "Alwert v. Cox Enterprises" on Justia Law

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David Helmer and Felicia Muftic were lead plaintiffs representing a certified class of homeowners who contended a radiant-heating hose, the Entran 3, manufactured by Goodyear Tire & Rubber Company (“Goodyear”) suffered design defects leading to cracks and leaks (the hose was used to convey hot fluid to provide heating for homes, installed permanently in walls, under flooring and in ceilings and concrete. At trial, Goodyear argued the leaks were caused by third parties’ improper installations. The jury returned a verdict in favor of Goodyear, concluding the Entran 3 was not defectively designed. On appeal, Plaintiffs argued that insufficient evidence supported the district court’s instruction on nonparty fault. They further argued that the district court failed to require proof of a necessary fact before instructing the jury regarding Colorado’s presumption that a product was not defective if ten years have passed since it was first sold. After review, the Tenth Circuit concluded that any error in the third-party liability instruction was harmless, and the inclusion of the instruction as to the presumption was proper. View "Helmer v. Goodyear Tire & Rubber" on Justia Law

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Plaintiffs Delbert Soseeah, Maxine Soseeah and John Borrego filed this action against defendants Sentry Insurance, Dairyland Insurance Company, Peak Property and Casualty Insurance Company, and Viking Insurance Company of Wisconsin (collectively Sentry) claiming, in part, that Sentry failed to timely and properly notify them and other Sentry automobile insurance policyholders of the impact of two New Mexico Supreme Court decisions regarding the availability of uninsured and underinsured motorist coverage under their respective policies. The complaint alleged that Delbert Soseeah, after being injured in a motor vehicle accident, made a claim for UM/UIM benefits under two policies of automobile insurance issued by Sentry to Mrs. Soseeah. According to the complaint, Mrs. Soseeah “never executed a valid waiver of UM/UIM coverage under the” two policies and, consequently, Mr. Soseeah “demanded that . . . Sentry reform” the two policies “to provide stacked uninsured/underinsured motorist coverage limits equal to the limits of the liability coverage on each of the vehicles covered by the” policies pursuant to the two New Mexico Supreme Court decisions. Sentry purportedly refused to reform the policies and rejected Mr. Soseeah’s claim for UM/UIM benefits. The complaint alleged that Sentry, by doing so, violated New Mexico’s Unfair Practices Act (UPA), violated a portion of New Mexico’s Insurance Code known as the Trade Practices and Frauds Act (TPFA), breached the implied covenant of good faith and fair dealing, and breached the terms of the two policies. The district court granted plaintiffs’ motion for class certification. Sentry subsequently sought and was granted permission to appeal the district court’s class certification ruling. Because plaintiffs failed to establish that all members of the general certified class suffered the common injury required by Rule of Civil Procedure 23(a)(2), the Tenth Circuit concluded that the district court abused its discretion in certifying the general class. Because the district court’s certification ruling did not expressly address the Rule 23 factors as they applied to each of the identified subclasses, the Court did not have enough information to determine whether the district court abused its discretion in certifying two subclasses. Consequently, the Court directed the district court on remand to address these issues. View "Soseeah v. Sentry Insurance" on Justia Law