SAN FRANCISCO - A panel of the Ninth Circuit U.S. Court of Appeals on May 30 reversed and remanded a case in which a debtor appealed a settlement agreement reached between the trustee and a group of creditors on grounds the debtor had no case because he never obtained an automatic stay in the proceeding which would bar the settlement agreement (John Patrick Stokes v. Todd Gardner, et al., No. 11-35233, Chapter 7, 9th Cir.; 2012 U.S. App. LEXIS 10856).
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on May 30 affirmed a district court's award of attorney fees to the defendants in a Fair Debt Collection Practices Act (FDCPA), 15 U.S.C.S. §§1692 et seq. suit, ruling that the district court did not err in finding that the plaintiff's FDCPA action was brought in bad faith and for the purpose of harassment (Christopher Ceresko v. LVNV Funding, LLC, et al., No. 11-15456, 9th Cir.; 2012 U.S. App. LEXIS 10859).
SAN FRANCISCO - Sellers who alleged unlawful tying by eBay Corp. in the market for online payment systems for use in online auctions may continue with their federal antitrust claims, a federal judge in California ruled May 29 in an unpublished ruling denying eBay's motion to dismiss the tying claims in the sellers' second amended class action complaint ( Charlotte Smith, et al. v. eBay Corporation, et al., No. C 10-03825, N.D. Calif.; 2012 U.S. Dist. LEXIS 74121).
SPOKANE, Wash. - A Washington federal judge on May 25 advised the law firm of Robbins, Geller, Rudman & Dowd and two of its attorneys that they would face sanctions for intentional misleading and inaccurate claims for various "Expenses" and "Disbursements" claimed in connection with a class suit filed against an educational travel company (Plumbers Union Local No. 12 Pension Fund, et al. v. Ambassadors Group, Inc., et al., No. 09-214, E.D. Wash.; 2012 U.S. Dist. LEXIS 73297).
MIAMI - Claiming that a company's directors and officers have abandoned their corporate obligations and that the company has been dissolved, a former officer said May 30 that there is no fiduciary to represent the company and, therefore, shareholders do not have standing to bring a shareholder derivative suit (William Lindquist, et al. v. Jin Linxian, et al., No. 11-cv-23876, S.D. Fla.). Subscribers may view the opinion available within the full update..
SAN JOSE, Calif. - The parties in a class suit that accuses Facebook Inc. of using the names and photos of users in advertising on the social networking site without the users' express permission filed a joint status report May 27 indicating that a settlement has been reached (Angel Fraley, et al. v. Facebook, Inc., et al., No. 11-1726, N.D. Calif.). Subscribers may view the joint report available within the full update.
SAN FRANCISCO - With shareholders failing to prove that certain alleged misstatements would have altered a shareholder vote regarding a merger, a federal judge in California on May 29 said the court lacked subject matter jurisdiction and dismissed the shareholders' derivative suit against a company and certain of its directors and officers (Board of Trustees of City of Hialeah Employees' Retirement System v. Mendes, et al., No. 11-cv-05692, N.D. Calif.). Subscribers may view the order available within the full update.
NEW YORK - The Second Circuit U.S. Court of Appeals on May 29 in a divided ruling denied rehearing en banc of its Feb. 1 opinion affirming its prior holding that a mandatory class action waiver clause in American Express Co.'s (AmEx) standardized service contract violated the Federal Arbitration Act (FAA) (In re: American Express Merchants' Litigation (Italian Colors Restaurant, et al. v. American Express Travel Related Services Company, et al.), No. 06-1871-cv, 2nd Cir.). Subscribers may view the order available within the full update.
DETROIT - A federal judge in Michigan on May 24 declined to reconsider his ruling that registered nurses (RNs) failed to produce evidence of an agreement among eight Detroit-area hospitals to fix the compensation of RNs sufficient to defeat the hospitals' motions for summary judgment on the RNs' conspiracy claims but held that the RNs did produce sufficient evidence to establish anticompetitive effects resulting from the exchange of compensation-related information among the hospitals in violation of federal antitrust law (Pat Cason-Merenda, et al. v. Detroit Medical Center, et al., No. 06-15601, E.D. Mich.; 2012 U.S. Dist. LEXIS 72593).
SCRANTON, Pa. - A federal judge in Pennsylvania on May 29 dismissed a Telephone Consumer Protection Act (TCPA) 47 U.S.C.S. § 227, complaint alleging that a creditor contacted a plaintiff via her mobile telephone after she sent a letter asking the creditor to stop calling, explaining that the TCPA does not authorize consumers to revoke consent to contact after they initially grant consent (Ashley Gager v. Dell Financial Services, LLC, No. 11-02115, M.D. Pa.; 2012 U.S. Dist. LEXIS 73752).
SAN DIEGO - In a multidistrict litigation in which a debt recovery firm is alleged to have violated the Telephone Consumer Protection Act (TCPA), 47 U.S.C.S. § 227 by making unauthorized phone calls to collect credit card debt, a federal judge in California on May 24 denied one set of plaintiffs' request to remand, disagreeing with their contention that their case does not benefit from inclusion in the MDL and the only issues remaining to be decided in their case are case-specific (In re: Portfolio Recovery Associates, LLC, Telephone Consumer Protection Act Litigation, No. 11-md-02295, S.D. Calif.; 2012 U.S. Dist. LEXIS 72833). A complimentary copy of the order is attached below.
SACRAMENTO, Calif. - A paint company's decision to sell directly to one of its consumers clients did not raise prices nor harm competition, a California judge held May 25 in granting judgment on California unfair competition law (UCL) claims (Weco Supply Co. Inc. v. The Sherwin-Williams Co., No. 10-00171, E.D. Pa.; 2012 U.S. Dist. LEXIS 73255).
WASHINGTON, D.C. - The U.S. Supreme Court on May 29 affirmed that a debtor company may not obtain confirmation of a nonconsensual Chapter 11 plan that permits the debtor to sell collateral free and clear of a creditor bank's lien without permitting the bank to credit-bid at the sale (RadLAX Gateway Hotel LLC v. Amalgamated Bank, No. 11-166, Chapter 11, U.S. Sup.). Subscribers may view the opinion available within the full update.
WASHINGTON, D.C. - The U.S. Supreme Court on May 29 agreed to hear an appeal of a ruling that a collection agency did not violate the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C.S. §§1692 et seq. when it contacted a debtor's employer to verify her employment status (Olivea Marx v. General Revenue Corporation and Kevin Cobb, No. 11-1175, U.S. Sup.).
CINCINNATI - A 401(k) plan participant who claimed that the plan sponsor and fiduciaries breached their fiduciary duties under the Employee Retirement Income Security Act (ERISA), 29 U.S.C.S. § 1001 et seq., by allowing the participants to invest in company stock when the stock price was artificially inflated did not suffer any out-of-pocket loss and, therefore, did not suffer any injury and did not have standing to sue, the Sixth Circuit U.S. Court of Appeals affirmed May 25 (Ann I. Taylor, et al. v. KeyCorp, et al., Nos. 10-4163, -4198, -4199, 6th Cir.; 2012 U.S. App. LEXIS 10613).
PASADENA, Calif. - The Ninth Circuit U.S. Court of Appeals on May 24 affirmed a federal court's dismissal of a suit in which the plaintiffs say defendants violated federal securities laws when they engaged in an investment scheme involving the sale of tenant-in-common interests in an apartment complex whereby they "intentionally and with deliberate recklessness" sought to inflate the value of the complex (Omar G. Scarborough, et al. v. Berthel Fisher & Co. Financial Services, No. 11-55313, 9th Cir.; 2012 U.S. App. LEXIS 10536).
YOUNGSTOWN, Ohio - A federal judge in Ohio on May 25 declined to dismiss a putative securities class action complaint alleging that the Federal Home Loan Mortgage Corp. (Freddie Mac) failed to disclose its true subprime exposure, ruling that the plaintiff properly state its claim (Ohio Public Employees Retirement System v. Federal Home Loan Mortgage Corp., et al., No. 08-00160, N.D. Ohio). Subscribers may view the order available within the full update.
SAN FRANCISCO - The Ninth Circuit U.S. Court of Appeals on May 24 affirmed the dismissal of a plaintiff's Fair Credit Reporting Act, 15 U.S.C.S. § 1681 claims regarding her closed Kohl's Department Stores Inc. credit card account, finding that the defendants were not "objectively unreasonable" in accessing her credit report (Kamlesh Banga v. Experian Information Solutions, et al., No. 10-15913, 9th Cir.; 2012 U.S. App. LEXIS 10516).
NEW YORK - A federal judge in New York on May 24 approved a $90 million settlement between former Lehman Brothers Holdings Inc. directors and officers and a proposed class of Lehman investors, settling claims that the executives misled the investors about Lehman's true exposure to subprime mortgages before its 2008 collapse (In re: Lehman Brothers Securities and ERISA Litigation, MDL No. 09-2017, (In re: Lehman Brothers Equity/Debt Securities Litigation, No. 08-5523), S.D. N.Y.). See related prior history, 2012 U.S. Dist. LEXIS 65167. A complimentary copy of the memorandum and order is attached.
WASHINGTON, D.C. - A unanimous U.S. Supreme Court on May 24 upheld a Fifth Circuit U.S. Court of Appeals majority decision to award summary judgment to Quicken Loans Inc. after finding that plaintiffs must show that parties split fees from settlement services in order to pursue a claim under the Real Estate Settlement Procedures Act (RESPA) 12 USCS § 2607. (Tammy Freeman, et al. v. Quicken Loans Inc., No. 10-1042, U.S. Sup.; 2012 U.S. LEXIS 3940).
SACRAMENTO, Calif. - A federal judge in California on May 22 ordered a company to return $100,000 it received from another company's Ponzi scheme proceeds, but the judge would not order disgorgement of the funds from the personal assets of the receiving company's director and officer who ordered the transfer of the funds (Securities and Exchange Commission v. Anthony Vassallo, et al., No. 09-cv-00665, E.D. Calif.; 2012 U.S. Dist. LEXIS 71301).
WILMINGTON, Del. - The U.S. trustee in the Chapter 11 case of bankrupt energy company Solyndra LLC on May 24 filed a brief in the U.S. Bankruptcy Court for the District of Delaware objecting to Solyndra's motion to increase post-petition funding (In Re: Solyndra LLC, No. 11-12799, Chapter 11, D. Del. Bkcy.). Subscribers may view the Trustee's brief available within the full update.
FORT PIERCE, Fla. - A federal judge in Florida on May 23 certified a class and preliminarily granted partial approval of a settlement in a suit in which a defendant was alleged to have violated the Fair Debt Collection Practices Act (FDCPA) in its attempt to collect a debt purportedly owed to a third-party mortgage receiver, but he rejected the proposed settlement's requirement for class members to submit claim forms (Malka Andes v. G. Moss and Associates, LLP, No. 11-14295, S.D. Fla.; 2012 U.S. Dist. LEXIS 71661).
BOISE, Idaho - A cease-and-desist letter stemming from a radar detector patent dispute enjoys immunity from suit under Idaho law as a communication made in the course of litigation, an Idaho federal judge said May 23, and the letter also cannot serve as the basis for a Lanham Act claim (Escort Inc., et al. v. Hoyt A. Fleming, et al., No. 1:12-cv-0064-BLW, D. Idaho; 2012 U.S. Dist. LEXIS 72193).
NEW YORK - An insurance company and its affiliate on May 24 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to a motion by bankrupt Hostess Brands Inc. that seeks to use alternative dispute resolution (ADR) as a means of resolving various claims in its Chapter 11 proceeding (In Re: Hostess Brands Inc., No. 11-22052, Chapter 11, S.D. N.Y. Bkcy.). Subscribers may view the ACE brief available within the full update.