AN UPDATE ON THE OPIOID LITIGATION
Bellwether Trial Set For 2021 In Opioid MDL
U.S. District Judge Dan Aaron Polster, overseeing opioid multidistrict litigation (MDL), has selected two cases for a bellwether trial in 2021 to test claims that the nation’s largest pharmacy chains fueled the opioid crisis by dispensing painkiller prescriptions they should have known weren’t appropriate.
In a two-page order, Judge Polster designated cases from the Ohio counties of Lake and Trumbull as bellwethers, noting that those cases were recommended by the Plaintiffs’ Executive Committee in the sprawling MDL.
Pharmacy Defendants – including CVS, Walgreens, Walmart and Rite-Aid – earlier in the week objected to scheduling another bellwether trial, especially in northern Ohio, calling it unnecessary in light of other upcoming trials and extensive proceedings that have already occurred before Judge Polster in Cleveland.
Judge Polster was unmoved by the opposition and told the parties to come up with a case management schedule that contemplates a four-week trial in May 2021. He also directed the Plaintiffs in the two new bellwethers to make any amendments to their complaints by May 15.
“The court selected two counties to go forward, and now we’ll start the discovery on the dispensing information for those two counties and look forward to the trial in May of 2021,” Joe Rice of Motley Rice LLC, a top lawyer for the MDL Plaintiffs, told Law360.
Hunter Shkolnik of Napoli Shkolnik PLLC, counsel for the counties, said in a statement to Law360 that the counties “are proud that they have been selected” and that they “look forward to this trial against the chain pharmacies that helped fuel it.”
Judge Polster began looking for new bellwethers after the Sixth Circuit on April 15 struck dispensing allegations from a bellwether trial that’s set for November in Cleveland, leaving only allegations of improper painkiller distribution. Other bellwether cases with pharmacy Defendants in the MDL are heating up in Oklahoma and California federal courts.
New York Attorney General Gets Green Light For Subpoenas Into Sackler Finances
On May 12, U.S. Bankruptcy Judge Robert Drain said that subpoenas from the New York attorney general into the finances of the Sackler family, owners of Purdue Pharma LP, can move forward. The judge authorized the state’s examination of the Sackers’ finances to proceed. Attorney General Letitia James had asked for the order in April, joined by the 24 other states who oppose a proposed settlement that would end 2,000 opioid suits brought by local governments, states and tribes. The Sacklers had agreed to pay $3 billion out of their own pockets in that settlement.
As previously reported, Purdue filed for Chapter 11 protection as part of the settlement agreement. Attorney General James said in a statement:
The opioid epidemic has ravaged American communities, while a single family has made billions profiting from this destruction. Just because Purdue Pharma has declared bankruptcy does not mean its owners deserve special protections under the law.
In late April, Attorney General James told the court that the Sacklers have delayed and resisted discovery requests into their financial information. The Attorney General said the Sacklers had produced few primary documents in the six months they have had to make voluntary disclosures about their finances. She also said the Sacklers want to redact information they deem irrelevant or personal, which would increase the cost of discovery.
Last fall, the New York Attorney General’s office said it had uncovered $1 billion in wire transfers by the Sackler family that appear to be an attempt to shield part of their fortune as they defended against myriad lawsuits alleging they fueled the opioid crisis.
The state had issued subpoenas in August to several financial institutions that Purdue does business with. Records from one unnamed financial institution alone show that the Sacklers transferred about $1 billion through family trusts and Swiss bank accounts, dating as far back as 2009, according to court filings.
At the beginning of May, Judge Drain told Purdue creditors that they can directly collect bank account information connected with the Sackler family. At a hearing on discovery issues in Purdue’s Chapter 11 case, Judge Drain said the creditors could question banks directly and work on ways to collect more of the information they say they need to determine if a proposed settlement with Purdue and the Sacklers over OxyContin sales is a good agreement.
During the May hearing, lawyers for the unsecured creditors committee and the ad hoc group of nonsettling states backed the complaints, saying that instead of the flood of information they had expected, they had received fewer than 6,800 documents. Many of the documents had either already been disclosed by Purdue or were public information.
The nonconsenting states are represented by Andrew M. Troop, Andrew V. Alfano and Jason S. Sharp of Pillsbury Winthrop Shaw Pittman LLP. The case is In re: Purdue Pharma LP, (case number 19-bk-23649) in the U.S. Bankruptcy Court for the Southern District of New York.
CVS Unit To Pay $15 Million Over “Improper” Opioid Dispensing
CVS Health subsidiary Omnicare Inc. has agreed to pay the U.S. $15.3 million to settle claims that it improperly dispensed opioids and other controlled substances without a valid prescription to long-term care facilities. The U.S. Department of Justice (DOJ) announced the settlement on May 13.
Pursuant to the settlement, Cincinnati-based Omnicare agreed to pay a $15.3 million civil penalty and entered into an agreement with the U.S. Drug Enforcement Administration (DEA) that will require the company to increase its auditing and monitoring of the emergency controlled substances it supplies to long-term care facilities.
The matter was investigated by the DEA’s offices in Los Angeles, San Francisco, Seattle and Denver in conjunction with the U.S. Attorney’s Offices in the Central District of California, the Eastern District of California, the District of Colorado, the District of Oregon and the District of Utah, according to the DOJ. U.S. Attorney Nicola T. Hanna said in a statement:
Omnicare dispensed powerful opioids without valid prescriptions and failed to inform federal authorities of significant losses of opioids and other drugs. With the opioid crisis still a very real concern, every entity that handles dangerous drugs will be held accountable to ensure powerful narcotics are properly dispensed and not diverted to the black market.
CVS Health said that the matter did not involve any of CVS Health’s other businesses, including CVS Pharmacy, CVS Caremark or Aetna.
Omnicare operates “closed door” pharmacies that are not open to the public, but rather provide controlled substances to nursing homes and other long-term care facilities. The company makes daily deliveries of prescription medications to facility residents, as well as limited stockpiles of controlled substances to be dispensed to patients on an emergency basis. The “emergency kits,” which often include opioids that are commonly abused, must be tightly controlled and tracked, according to the DOJ, and the controlled substances can only be dispensed with a valid prescription.
Following its investigation, the government alleged that Omnicare violated the federal Controlled Substances Act in its handling of emergency prescriptions, its controls over the emergency kits and its processing of written prescriptions that were missing things like the prescriber’s signature. The government said the company allowed care facilities to use opioids from the kits days before doctors actually provided a prescription. DEA Acting Administrator Uttam Dhillon said in a statement:
Omnicare failed in its responsibility to ensure proper controls of medications used to treat some of the most vulnerable among us. DEA is committed to keeping our communities safe by holding companies like Omnicare accountable for such failures, while ensuring continuity of care and necessary access to emergency prescription drug supplies.
The Beasley Allen Opioid Litigation Team
Beasley Allen’s “Opioid Litigation Team” includes Rhon Jones, Parker Miller, Ryan Kral, Rick Stratton, Will Sutton, Jeff Price and Tucker Osborne. This team of lawyers represents the State of Alabama, the State of Georgia, and numerous local governments and other entities, as well as individual claims on behalf of victims. If you need more information on the opioid litigation contact one of these lawyers at 800-898-2034 or by email at Rhon.Jones@beasleyallen.com, Parker.Miller@beasleyallen.com, Ryan.Kral@beasleyallen.com, Rick.Stratton@beasleyallen.com, William.Sutton@beasleyallen.com, Jeff.Price@beasleyallen.com or Tucker.Osborne@beasleyallen.com.
PRODUCT LIABILITY UPDATE
Graco Accused Of Marketing Unsafe Booster Seats
A lawsuit has been filed against Graco Children’s Products Inc., alleging that booster seats made and sold by the company are unsafe for small children, despite marketing claims that the products are safe for kids as small as 30 pounds. The proposed class action lawsuit was filed in New York federal court. Named Plaintiff Silvia Tehomilic alleged in the complaint that media reports and testing have shown that Graco’s marketing claims that its car booster seats have been tested for side impacts are not true. She also says there are no federal or state standards, and that the test Graco refers to is one it came up with.
The Plaintiff alleges that Graco markets the TurboBooster and Affix model seats as safe for children as young as 3 and as light as 30 pounds, despite knowing since 2002 that the seats are not safe for children younger than 4 years old and 40 pounds.
According to the complaint, the National Highway Traffic Safety Administration (NHTSA) reported in 2002 that booster seats are recommended for children who are at least 40 pounds, and reiterated that finding in 2010 in a report that said that prematurely moving a child to a booster seat is among the primary reasons for child injuries in car crashes where the child is restrained.
The complaint cites a media report that performed a side-impact test using a dummy in one of Graco’s booster seats, in which the dummy “hurtled out of the shoulder belt” in a way that made the spine, head and neck vulnerable to injury. The Plaintiff also said in the complaint that Graco does not publish or otherwise share its internal test results, and the company set its own testing protocols, which renders the testing “meaningless.”
It’s stated in the complaint that while Graco has aggressively marketed the booster seats in the United States as safe for children as light as 30 pounds, in Canada for the same product, the company represents that children less than 40 pounds risk “serious injury or death,” when using the seats.
By concealing the truth about the booster seats, the Plaintiffs said that Graco has put its profits above the safety of the children it markets to. She adds that the company’s website still includes statements saying the seats are safe for 30-pound children.
The Plaintiff seeks to represent two national classes, a multistate class and a New York-based class with claims for consumer fraud, breach of warranty, common law fraud and unjust enrichment. She is asking the court to grant restitution, issue an injunction forcing Graco to recall the booster seats and stop marketing them as safe for children less than 40 pounds, and order Graco to investigate the root causes of the decision to market the seats and what steps can be taken to correct its actions.
The Plaintiff is represented by Alex R. Straus, Gregory F. Coleman and Jonathan B. Cohen of Greg Coleman Law PC and Daniel K. Bryson, Martha A. Geer and Patrick M. Wallace of Whitfield Bryson LLP. The case is Tehomilic v. Graco Children’s Products Inc. et al., (case number 2:20-cv-02067) in the U.S. District Court for the Eastern District of New York.
Florida Court Establishes Jurisdiction Over Foreign Battery Producer
On April 24, 2020, Judge Ronald W. Flury of Florida’s Second Circuit Court entered an order denying a motion to dismiss claims by a Florida resident against a foreign corporation based on a lack of personal jurisdiction. Samsung SDI Co., Ltd. (SDI) had filed a motion to dismiss Plaintiff Bennet Fields’s claims on the basis that the Court cannot exercise personal jurisdiction over SDI.
The claims involved a rechargeable lithium ion battery (RLIB), manufactured by SDI and purchased at a Tallahassee, Florida, vaping store operated by South Georgia Vapor. The battery exploded, causing Fields serious injury, including third degree burns to his legs and genitalia.
SDI is a foreign company with its headquarters in Yongin, South Korea. SDI purports to design, manufacture, and distribute various energy products, including small-size, cylindrical 18650 RLIBs, through a global network of locations.
In its motion, SDI sought to dismiss Plaintiff’s claims by arguing the Court lacks personal jurisdiction over SDI with respect to Plaintiff’s claims. While Plaintiff conceded that the Court lacks general jurisdiction over SDI in the matter, the dispute centered on whether the Court may exercise specific jurisdiction over SDI.
SDI’s primary argument against the Court’s exercise of specific jurisdiction is that Plaintiff’s claims do not sufficiently arise out of or relate to SDI’s business activities in Florida. SDI argued that because it does not sell or distribute its 18650 RLIBs specifically for vaping purposes in Florida (or anywhere), SDI cannot be subject to this court’s specific jurisdiction.
Plaintiff countered that SDI has purposefully availed itself of the privilege of doing business in the state of Florida by virtue of its entering into supply agreements with Florida companies, distributing battery products into the state of Florida and, specifically, selling and shipping SDI 18650 RLIBs into the state of Florida – the product at the heart of Plaintiff’s claim. Plaintiff argues that his claims relate to SDI’s Florida business activities because they arise from his use of SDI’s 18650 RLIBs, a product SDI has sold and shipped into Florida.
The Court found that personal jurisdiction as to SDI was established based on the Court’s ability to exercise specific jurisdiction over SDI. The facts of this case met each element set forth by Wells Fargo Equipment Finance, Inc. v. Bacjet, LLC, 221 So.3d 671, 676 (Fla. 4th DCA 2017). The elements dictate that to satisfy minimum contacts required to support the exercise of personal jurisdiction, the Defendant’s contacts: (1) must have been related to or given rise to the Plaintiff’s cause of action; (2) must involve some act by which the Defendant purposefully availed itself of the privilege of conducting activities within the forum; and (3) must be such that the Defendant should reasonably anticipate being hauled into court there.
The main point of contention was whether Plaintiff’s claim sufficiently relates to SDI’s Florida contacts. SDI’s primary argument is that it does not sell or ship its 18650 RLIBs to Florida for the discrete purpose of use with vaping devices. SDI argued that because it does not design the product for that particular use, that any claim arising from injury resulting from such cannot be “related to” its widespread sale of that product, including into the state of Florida. Plaintiffs countered that argument by contending that the relatedness test does not require SDI’s forum contacts to be so narrowly targeted to a specific or intended use of the product. Plaintiff argued that the relatedness test merely requires some relationship between the forum, Defendant, and the litigation.
The Court agreed with the Plaintiff, on the basis that under SDI’s theory of relatedness, SDI could never be subject to a states’ jurisdiction for a claim stemming from an SDI 18650 RLIB explosion in an e-cigarette simply because SDI does not intend consumers to use them in that way, despite the foreseeability of such conduct to SDI.
If you have any questions, contact Will Sutton at 800-898-2034 or by email at William.Sutton@beasleyallen.com. Will is one of the Beasley Allen lawyers handling the e-cigarette litigation for the firm.
Prepac Recalls 4-Drawer Chests Due To Tip-Over, Entrapment Hazards
Prepac is recalling about 21,000 4-drawer chests due to tip-over and entrapment hazards. According to the Consumer Product Safety Commission (CPSC), the recalled chests are unstable and can tip over if not anchored to the wall, posing serious tip-over and entrapment hazards that can result in death or injuries to children.
This recall includes Prepac 4-drawer chests with plastic drawer glides. The recalled chests were sold in three finishes, black, oak and white. The following model numbers are included in the recall and are printed on the instruction manual:
||29-3/4”H x 30”W x 16”D
||29-3/4”H x 30”W x 16”D
||29-3/4”H x 30”W x 16”D
||29-3/4”H x 30”W x 16”D
Consumers should immediately stop using the recalled chests if not properly anchored to the wall and place them in an area that children cannot access. Contact Prepac to receive a free tipover restraint kit and consumers can request a one-time, free in-home installation of the wall anchor strap. There have been no reported incidents or injuries. The 4-drawer chests were sold online at Overstock.com, Target.com, Amazon.com and other online retailers from April 2005 through September 2018 for about $75. Consumers can contact Prepac Manufacturing toll-free at 877-773-7221 from 8 a.m. to 5 p.m. PT Monday through Friday or online at prepacmfg.com and click on “Recall Information” for more information.
Keurig Sues After Scalding Water Ejects From Machine, Burning Minor
Everyone knows that Keurig coffee machines use hot water, and everyone knows that they should not open the machine while it is in the process of brewing. However, Ambrea Beard did not expect that her daughter would be seriously injured by their new Keurig machine spraying scalding water after the brewing process was complete. Ms. Beard has now filed suit against Keurig Inc. for her minor daughter’s burn injuries.
Keurig has had some issues with customers being burned by spraying water before. In 2014, Keurig Green Mountain, Inc, recalled more than 6.6 million units after receiving 200 reports of hot water ejecting from the coffee-making machines, resulting in 90 burn injuries. In those cases, Keurig allowed customers to register for a free repair kit, and even stated that customers could still use the Keurig machines, but should stand away from the machines while brewing, and customers should not brew two or more cups in quick succession.
Keurig has had warnings on its machines stating that extremely hot water is being used in the K-Cup during the brewing process, and that the handle and K-Cup pack assembly should never be opened during the brewing process. However, I.K.G., who is Ambrea Beard’s injured daughter, was burned when water sprayed from the Keurig machine after the brewing process was completed. As a result, she received severe burns to her face, neck, and chest.
The suit is styled I.K.G. et al, v. Keurig Inc., et al, and is pending before Judge Coulee in the Northern District of Georgia.
MASS TORTS UPDATE
Beasley Allen Continues To Investigate Zantac Cases Despite Court Closures
Consumers continue to file lawsuits alleging that Zantac caused them to develop cancer. As we reported in the April issue, Zantac and generic prescriptions containing ranitidine were pulled from the market by the U.S. Food and Drug Administration (FDA) due to the presence of N-nitrosodimethylamine, (NDMA), a probable human carcinogen.
NDMA exists in low levels in the environment and is commonly ingested in the diet. When ingested at low levels, NDMA is not considered a cancer risk to humans. However, new FDA testing has confirmed that NDMA levels increase in ranitidine even under normal storage conditions. When ranitidine samples are stored at higher temperatures, including temperatures during distribution and handling by consumers, the NDMA levels increase significantly. According to the FDA, such conditions “may raise the level of NDMA in the ranitidine product above the acceptable daily intake limit.”
Additionally, previous studies have found that it is also possible that medicines containing ranitidine can cause NDMA to form in the body after ingestion. According to reports, approximately 60 million people suffer from heartburn, 15 million use prescription ranitidine and countless others use over-the-counter versions.
Despite court closures due to COVID-19, Beasley Allen lawyers continue to investigate potential claims involving regular Zantac or ranitidine use that may have caused cancer. Consumers who may have been affected can contact Frank Woodson ( Frank.Woodson@beasleyallen.com) or Lisa Courson ( Lisa.Courson@beasleyallen.com) for more information at 800-898-2034.
An Update On The Bone Cement Litigation Lawsuit Filed involving Cardinal Health’s Cardinal HV Bone Cement
As we have previously reported, medical literature has linked high-viscosity (HV) bone cements to significantly increased rates of early failures for total knee replacements. The primary reason the HV bone cement fails is mechanical loosening. The mechanical loosening is caused by a failure of the bond between the tibial baseplate and requires an additional revision surgery. The Bone Cement Litigation currently involves four models of bone cements:
- Stryker’s Simplex HV;
- DJO Global and Biomet’s Cobalt HV;
- Cardinal Health’s Cardinal HV; and
- DePuy’s SmartSet HV.
Beasley Allen lawyers have now filed 15 bone cement cases in various federal district courts across the country. The most recently filed case involves Cardinal Health’s Cardinal HV.
Cardinal HV is a bone cement manufactured in Germany by Osartis, GmbH and then sold in the United States by Cardinal Health, Inc. Many may recognize Cardinal Health from its role in the opioid epidemic. Cardinal Health is known as one of the “Big Three” opioid distributors, along with McKesson Corp. and AmerisourceBergen Corp.
Beasley Allen lawyers filed the first known lawsuit in the country involving Cardinal HV. The lawsuit filed in the United States District Court for the Eastern District of Wisconsin in Milwaukee was on behalf of an individual who had both knees replaced using Cardinal HV bone cement. In only two years, both artificial knees failed due to mechanical loosening.
Mechanical loosening, as shown by recent studies, has occurred at a significantly increased rate in patients implanted with HV bone cement, including the Cardinal HV bone cement. We expect that discovery in the filed cases will show Cardinal Health knew about the defective nature of HV bone cements and the significantly increased rates in early failures. Despite this knowledge, Cardinal Health continues to market and sell Cardinal HV bone cement while downplaying its risks.
Beasley Allen lawyers in our Mass Torts Section continue to investigate cases involving bone cement failure. For more information, contact Ryan Duplechin, Melissa Prickett, Chad Cook or Roger Smith, lawyers in the Section, at 800-898-2034, or by email at Ryan.Duplechin@beasleyallen.com, Melissa.Prickett@beasleyallen.com, Chad.Cook@beasleyallen.com or Roger.Smith@beasleyallen.com.
Makers Of Diet Drug Belviq Likely Knew Of Cancer Link For Over a Decade
Belviq (lorcaserin) was approved by the Food and Drug Administration (FDA) in 2012 as a weight-loss drug. Belviq was the first diet drug to be approved in almost 15 years largely because of the recall of Fen-Phen and Redux. Recently, the FDA analyzed Belviq’s clinical trial results and recommended that Eisai, the manufacturer and seller of the drug, pull it from the market. However, even before the drug was introduced into the market, there were signals of cancer.
Belviq was originally submitted for approval in 2009. In October 2010, the FDA rejected the new drug application (NDA) approval of Belviq, for both clinical and non-clinical issues. The FDA’s complete response letter states there was an unclear safety margin for lorcaserin-emergent brain astrocytoma, and that additional clinical studies may be required to obtain a more complete assessment of its benefit-risk profile. Arena Pharmaceuticals, the manufacturer of Belviq at the time, submitted a complete response letter in January 2012, which explained that increased tumors found in rats would not affect humans.
After the FDA approved Belviq in 2012, the agency required the manufacturer to continue with a clinical trial to make sure we did not have a repeat of Fen-Phen and Redux, which were linked to cardiovascular issues and subsequently recalled. Belviq’s clinical trial concluded in 2018, and Eisai posted the results in July 2019. Eisai presented that Belviq does not appear to affect cardiovascular health. However, since Eisai knew the study was required for cardiovascular reasons, it downplayed the clinical trial’s showing of an increased risk of cancer. A few months later, the FDA started analyzing the data and then brought the increased cancer results to light in early 2020.
After several years of Belviq being on the market, thousands of patients took the drug without knowing of cancer concerns, which Arena Pharmaceuticals and Eisai at least should have known about more than 10 years ago. Eisai, in a press release about withdrawing Belviq, said its interpretation of the clinical trial data “differs from that of the FDA.” In other words, Eisai would still be selling Belviq had the FDA not stepped in.
Roger Smith, Ryan Duplechin and Melissa Prickett, lawyers in our firm’s Mass Torts Section, are currently investigating individual cases of pancreatic cancer, colorectal cancer and lung cancer in patients who have been treated with Belviq. If you need more information, contact the lawyers at 800-898-2304 or by email at Roger.Smith@beasleyallen.com, Ryan.Duplechin@beasleyallen.com or Melissa.Prickett@beasleyallen.com.
J&J Settles With West Virginia In Pelvic Mesh Litigation
West Virginia has reached a $3.9 million settlement with Johnson & Johnson (J&J) to resolve claims that the company deceptively marketed its pelvic mesh products by misrepresenting their safety history. Attorney General Patrick Morrisey announced the settlement last month. The settlement ends a lawsuit that claimed J&J and its subsidiaries Ethicon Inc. and Ethicon US LLC misrepresented the effectiveness and risks of the surgical products in marketing and educational materials, as well as in personal meetings and published medical articles.
Those marketing materials consistently left out or hid complications with the devices, according to the attorney general. Attorney General Morrisey said in a statement:
The improper marketing of medical products can put the health of consumers at risk. This settlement demonstrates our office’s commitment to hold accountable corporations who ignore potential risks and side effects or omit such crucial details from the materials provided to doctors and patients.
West Virginia’s settlement also involves claims over metal-on-metal hip replacement devices.
In October, J&J agreed to a $117 million multi-state settlement to end litigation over the marketing of its surgical mesh devices. Forty-one states and the District of Columbia are participating in the settlement. The states’ investigation found that J&J and Ethicon either misrepresented or failed to adequately disclose possible adverse effects of the mesh devices, including incontinence and vaginal scarring. Attorney General Morrisey said in the statement that has state received “significantly” more funds by bringing its own claims. The settlement also includes a 5% cap on attorneys’ fees for outside counsel related to the mesh suit.
In 2016, the U.S. Food and Drug Administration (FDA) raised the approval bar for transvaginal pelvic mesh devices, reclassifying them as high-risk devices that need a safety evaluation before they can be sold. In January, a California judge ruled in a suit brought by California’s attorney general that J&J and Ethicon misled consumers about the true risks of their pelvic mesh products and must pay nearly $344 million in civil penalties. In a statement of decision after the lengthy bench trial, San Diego Superior Court Judge Eddie Sturgeon sided with California Attorney General Xavier Becerra and found J&J and Ethicon violated the state’s false advertising and unfair competition laws.
Judge Sturgeon found that the Defendants had lied to California consumers and doctors about the safety of two lines of mesh products made with polypropylene: Tension-free Vaginal Tape, launched in 1998 to treat stress urinary incontinence, and the Prolift, launched in 2005 to treat pelvic organ prolapse. J&J stopped selling the prolapse-treating mesh in 2012.
An Update On Class Action Litigation
Honda Sold Cars With Dangerous Fuel Pumps
Beasley Allen, on behalf of a proposed class of drivers, has filed suit against Honda Motor Co. Ltd. and parts manufacturer Denso Corp. alleging the companies produced vehicles that they knew had defective and dangerous fuel pumps that could cause stalling or shutdown while driving. The suit was filed by named Plaintiff Tucker Oliver.
In an 80-page complaint filed on May 13 in the United States District Court for the Northern District of Alabama, the named Plaintiff alleged that Honda and Denso knew the fuel pumps were defective as early as 2016 but misdiagnosed the problem and offered inadequate repairs in the form of a software upgrade instead of pump replacement. As a result of Honda’s actions and inactions, owners and lessees of the class vehicles have been and still are unknowingly driving on roads and highways in potentially ticking time bombs while Honda knowingly exposes its customers, from whom it made millions of dollars from the sale of the class vehicles, to the risk of grave physical harm or even death.
The pumps contain impellers made from defective plastic, which warp while used under normal driving conditions. This defect not only renders the engine inoperable but can also cause damage to other parts of the engine, according to the complaint. Honda and Denso had access to and knowledge of reasonable alternate designs that would not have the same problem. The pumps were the subject of an April recall by Denso, which pulled back more than 2 million defective units. We allege in the suit that the recall is an admission that the pumps present an unreasonable risk to consumers. The suit also cites complaints about the defect that drivers filed with the National Highway Traffic Safety Administration (NHTA), some as early as 2013, and that Honda admitted to knowing of a defect in 2016.
Honda unquestionably knew that the pumps were defective because it recalled more than 437,000 vehicles in January 2019 for a defect in the Denso-made fuel pumps that could result in hesitations in acceleration and stalling. But that recall failed to adequately remedy the situation because instead of replacing the units, Honda only offered a software upgrade as a temporary solution for vehicles whose fuel pumps failed, meaning the automaker left thousands of vehicles on the road and at risk of failure. While Honda continued to sell vehicles with this dangerous defect, it marketed its products based on their supposed safety and dependability. The defect not only poses a danger to drivers’ safety, but also devalues the cars.
In the suit, Plaintiff Oliver seeks to represent all current and former owners of 2013-2019 Honda vehicles that use the defective pumps in Alabama and nationwide classes. Oliver asks for unspecified damages and an order telling Honda to notify class members of the defect and its dangers. The Beasley Allen lawyers representing Oliver have also filed complaints making similar accusations against Subaru of America Inc. in Alabama in April and against Toyota Motor Corp. in New York in February.
Oliver is represented by Beasley Allen lawyers Dee Miles, Demet Basar, Clay Barnett and Mitch Williams. The case is Oliver v. Honda Motor Co. Ltd. et al., (case number 5:20-cv-00666) in the U.S. District Court for the Northern District of Alabama.
Jeep Oil-Guzzling Engines Class Action Filed Against Fiat Chrysler
Consumers have filed a proposed class action against Fiat Chrysler in a Michigan federal court alleging the company knowingly sold Jeep vehicles equipped with dangerously defective engines that sucked up excessive amounts of oil, resulting in premature wear and catastrophic engine failure.
Plaintiffs Amber Wood, Ashley Schuchart, Karen Burke and Danielle Coates allege the 2.4L Tigershark MultiAir II engine in certain Jeep Cherokee, Compass, Renegade and other FCA US LLC vehicles contained a design or manufacturing defect that caused them to improperly burn off or consume abnormally high amounts of oil. That could then result in the vehicles’ engines stalling or abruptly shutting down without warning or indicator lights going off – all while the vehicles are being driven – creating a major safety hazard for passengers and other cars on the road.
Sufficient levels of engine oil are needed to keep engines properly lubricated or cooled so they don’t prematurely wear down internal parts, which could lead to poor engine performance or catastrophic engine failure, according to the complaint. The suit says:
The class vehicles regularly experience such severe shortages of oil that they automatically shut down to protect the engine before FCA’s indicator system tells them they are due for an oil change. This represents a complete failure of the oil change indicator system to monitor and provide meaningful information regarding the real-world status of the class vehicle’s oil levels.
FCA has known since 2015 that vehicles with the 2.4L Tigershark MultiAir II engine could shut down without warning due to low oil levels or oil pressure, given the numerous complaints that had been lodged directly with FCA, its dealerships, on internet forums and through the National Highway Traffic Safety Administration (NHTSA). The consumers alleged:
Yet rather than being honest about these problems, FCA has engaged in efforts to conceal them by describing the defects as ‘normal’ in a technical service bulletin.
FCA issued a July 31, 2015, technical service bulletin related to “engine oil consumption” that advised its dealerships on what was an “acceptable rate of oil consumption” for all 2013 to 2016 vehicles equipped with gasoline engines, according to the complaint. The bulletin stated that “engines require oil to lubricate and protect the load bearing and internal moving parts from wear including cylinder walls, pistons and piston rings.” The consumers alleged in the suit that FCA dealerships found there was “a problem with the pistons and/or rings causing the oil consumption defect.”
Aside from the safety risks, it’s alleged that the defect increases the expected cost of ownership and maintenance of the affected vehicles because car owners have to replenish the oil of their vehicles at “excessive abnormal rates.” Normalizing the alleged defect has allowed FCA to avoid the economic fallout that would inevitably result from recalling millions of affected vehicles, the suit says.
The class vehicles include the 2015-2016 Chrysler 200; 2013-2016 Dodge Dart; 2016-2020 Fiat 500X; 2017-2020 Fiat Toro; 2014-2020 Jeep Cherokee; 2017-2020 Jeep Compass; 2015-2020 Jeep Renegade; and 2015-2020 Ram ProMaster City.
The suit asserts claims for unfair and deceptive business practices; fraudulent concealment under Illinois, Ohio and Pennsylvania law; as well as violations of state consumer protection laws, among other claims.
The consumers are represented by Steve W. Berman and Elaine T. Byszewski of Hagens Berman Sobol Shapiro LLP, E. Powell Miller of The Miller Law Firm PC and Jeffrey S. Goldenberg and Todd Naylor of Goldenberg Schneider LPA. The case is Wood et al. v. FCA US LLC, (case number 2:20-cv-11054) in the U.S. District Court for the Eastern District of Michigan.
Drivers In Proposed Class Action Say Subarus Accelerate Without Warning
A proposed class action was filed against Subaru in New Jersey federal court on May 14, alleging that certain Foresters and Outbacks suddenly accelerate and that the automaker hid the defect. The drivers allege that Subaru has known about the defect since at least 2011, which causes the cars to accelerate without warning, often when a driver uses the brake pedal. The defect affects 2012-2018 Subaru Forester, 2015-2019 Subaru Legacy and 2015-2019 Subaru Outback vehicles. The drivers allege:
Not surprisingly, many class vehicle owners have reported collisions or near-collisions due to the sudden and unexpected acceleration. For example, the sudden unintended acceleration led to the hospitalization of Plaintiffs Martin and Margaret Greenwald.
Martin Greenwald was driving a Forester on a New Jersey highway in March with his wife when he pressed the brake pedal, but instead the car accelerated, hit a guard rail and flipped over. The affected vehicles have an inadequate fault detection system that is not robust enough to detect foreseeable problems, including unintended acceleration. In addition, the throttle body assembly and other components have faulty circuit boards. Finally, the class vehicles’ brake override system malfunctions or otherwise is ineffective to sufficiently override acceleration that the driver does not initiate and cannot control.
More than 200 complaints have been filed over the alleged defect with the National Highway Traffic Safety Administration (NHTSA), the drivers said. In one complaint, a 2017 Subaru Forester accelerated when the brake pedal was depressed and hit a cement divider, then crashed into a tree and a parked vehicle. It’s alleged further in the suit:
Instead of recalling cars and informing customers about the alleged defect, Subaru told dealers to tell customers that their cars are operating normally or that no issues could be found. Moreover, dealers also shift blame to the vehicle operators by telling them that the vehicle’s floor mats may cause the unintended acceleration, often even when the mats are properly secured and in place. This is a common practice in the automotive industry.
The drivers seek to represent a nationwide class of people who bought or leased the affected vehicles, as well as subclasses for drivers in Colorado, New Jersey, Connecticut and North Carolina. They claim that Subaru violated the Magnuson-Moss Warranty Act and the consumer protection laws of Colorado, New Jersey, Connecticut and North Carolina. The suit also includes unjust enrichment and breach of express warranty claims.
The drivers are represented by Russell D. Paul, Amey J. Park and Abigail J. Gertner of Berger Montague PC and Steven R. Weinmann, Tarek H. Zohdy, Cody R. Padgett and Trisha K. Monesi of Capstone Law APC. The case is Weston et al. v. Subaru of America Inc. et al., (case number 1:20-cv-05876) in the U.S. District Court for the District of New Jersey.
Investors Filed New Suit Against Facebook Over Privacy Failures
Facebook stockholders filed a new derivative class suit in Delaware Chancery Court on May 13 accusing company founder Mark Zuckerberg and 18 other current or past directors and officers of fiduciary duty failures in the wake of a recently affirmed $5 billion federal privacy and data breach settlement.
While the complaint remained sealed at press time, publicly accessible documents in the filing include a copy of a Federal Trade Commission (FTC) penalty order and $5 billion fine issued last year for violations of the law and a privacy-focused FTC administrative order issued in 2012. The earlier order directed Facebook – the world’s largest social media company – to stop misleading consumers about their privacy status and ability to control access to their personal data and to better protect and control user information.
Related documents filed with the newly filed suit referred to a separate Chancery Court stockholder action for Facebook records in connection with the Cambridge Analytica privacy breach episode that came to light in 2016. In that case, third parties secretly harvested and sold user data to Cambridge, a U.K.-based political research and consulting firm.
Revelations and outrage surrounding Cambridge Analytica fed into the FTC’s $5 billion enforcement action and reform order, issued last year and affirmed in the U.S. District Court for the District of Columbia in April.
In the district court opinion upholding the FTC’s recent $5 billion fine and reform demands, Judge Timothy J. Kelly said the claims made against Facebook, which has 2.6 billion users, and some friends of the court briefs “call into question the adequacy of laws governing how technology companies that collect and monetize Americans’ personal information must treat that information.”
Named in the latest suit are seven current directors, including Zuckerberg, chief operating officer Sheryl Sandberg, Peggy Alford, Marc Andreessen, Kenneth Chenault, Peter Thiel and Jeffrey Zients. The four current directors not named in the suit were appointed in February or March of this year.
Also named are Erskine Bowles, Sue Desmond-Hellmann, Reed Hastings, Jan Koum, Lee Atwahl, Konstantinos Papamiltiadis, Sam Lessin, Christopher Cox, David Fisher, Michael Schropefer, Colin Stretch and David Wehner.
Because derivative suits seek damages for the company from directors and because the claims officially belong to the company, stockholders must first either demand board action on the allegations or show the effort would be futile because of director conflicts or risks of personal liability.
For derivative cases alleging waste of corporate assets, the stockholders also would have to get past the hurdles raised under the In Re: Caremark International Derivative Litigation case in 1996. That case requires a successful argument that the actions in dispute were so costly or one-sided that no reasonable, loyal director would have approved them.
Under the FTC settlement approved in April, Facebook was directed to create a “more robust” privacy program with a new privacy committee and a dedicated corporate officer. The FTC said in a summary that Facebook must develop “multiple channels of compliance,” and restructure its approach to privacy “from the corporate board-level down.
In addition, the order called for mechanisms to ensure that Facebook executives are “accountable for the decisions they make about privacy, and that those decisions are subject to meaningful oversight.”
Construction and General Building Laborers’ Local No. 79 General Fund, City of Birmingham Retirement and Relief System and stockholder Lidia Levy are represented by Kevin H. Davenport, Samuel L. Closic, John G. Day and Elizabeth Wang of Prickett Jones & Elliott P.A.; Peter B. Andrews, Craig J. Springer and David M. Sborz of Andrews & Springer LLC; and Ryan M. Ernst of O’Kelly Ernst & Joyce.
The case is Construction and General Building Laborers’ Local No. 79 General Fund, et al, (case number 2020-0363) in the Court of Chancery of the State of Delaware.
Class Action Lawsuit Filed In Connection With IKEA’s Recall Of Nearly 30 Million Dressers
A class action lawsuit has been filed against IKEA US Retail LLC and IKEA North America Services LLC (collectively IKEA) on behalf of IKEA customers. This class action follows a recall of 8 million MALM chests and dressers and 21 million additional children’s and adult chests and dressers that IKEA knew were prone to tip over. These dressers did not comply with voluntary standards that required stability testing and have caused death and injury to children. The class action seeks damages for consumer protection violations, IKEA’s failure to issue refunds as promised in the recall, and for IKEA’s inadequate attempts to notify purchasers of the recall.
The lawsuit, filed in the U.S. District Court for the Eastern District of Pennsylvania on behalf of the parents of two young children who purchased IKEA MALM dressers in 2012, alleges that IKEA marketed and sold the dressers knowing they were unsafe and prone to tip over. The lawsuit also alleges IKEA did not contact its customers by mail, email or text to personally notify them of the initial recall on June 28, 2016, and a “re-announced” recall on Nov. 21, 2017.
It is further alleged in the suit that IKEA is not honoring the terms of the recalls and details the difficulty that the Plaintiffs, and other customers who took to the internet to complain, have experienced in returning the dressers, getting cash refunds, and getting IKEA to pick up the dressers at their homes.
The Plaintiffs in the lawsuit seek to represent a nationwide class of persons who purchased or owned the chests and dressers, which were manufactured between January 2002 and June 2016.
Any persons who purchased or owned an IKEA chest or dresser included in the June 28, 2016, recall and the “re-announced” recall of Nov. 21, 2017, may be entitled to a refund and other financial compensation.
The law firms of Feldman Shepherd Wohlgelernter Tanner Weinstock Dodig LLP and Francis Mailman Soumilas filed the class action referred to above.
Settlements In Class Action Litigation
The following are some of the class action settlements that were reached last month. It appears that there has been a slowdown in activity because of the effects on the courts by the Coronavirus Pandemic.
Facebook Users Share Details Of Historic $550 Million Privacy Deal
A class of Illinois Facebook users has revealed the long-awaited details of a record-setting $550 million biometric privacy deal reached with the social media giant earlier this year. Each class member who files an eligible claim is expected to receive between $150 and $300. The company also agreed to provide nonmonetary injunctive relief to put an end to the certified class action claiming the company had breached Illinois’ Biometric Information Privacy Act (BIPA) by using facial recognition technology without users’ consent to fuel its photo tag suggestion feature.
The proposed settlement requires Facebook to create a $550 million settlement fund, from which class members who submit a valid claim shall be entitled a pro rata share, after deducting administrative expenses, any fee award to class counsel and incentive awards to three class representatives.
The class is believed to consist of roughly 6 million Illinois residents for whom Facebook stored a face template after June 7, 2011.
This prospective relief requires Facebook to automatically turn class members’ facial recognition settings to “off” and delete any face templates it may have for a class member unless that individual affirmatively opts in to facial recognition after receiving BIPA-complaint disclosures in a standalone document. Facebook will be precluded not only by statute, but also by a separately enforceable agreement from collecting or storing class members’ biometric data, through facial recognition technology or any other means in Illinois, without specific class member consent.
The settlement, if approved by the court, would close out nearly five years of litigation that spanned two states and was on the brink of trial earlier this year. The dispute was launched in 2015, when the named Plaintiffs filed three separate lawsuits in Illinois state and federal court. The initial complaint was the “first ever class action” filed under BIPA, a statute that was quietly enacted in 2008 but didn’t start to spur a barrage of lawsuits against businesses and employers until five years ago.
A hearing was held on May 21 before U.S. District Judge James Donato to consider the preliminary approval request.
The class is represented by Jay Edelson, Ryan D. Andrews, Benjamin Richman, Alexander G. Tievsky, J. Aaron Lawson, Rafey S. Balabanian and Lily Hough of Edelson PC; Paul J. Geller, Stuart A. Davidson, Lucas Olts, Shawn A. Williams, Christopher C. Gold, John H. George, Patrick J. Coughlin, Ellen Gusikoff Stewart and Randi D. Bandman of Robbins Geller Rudman & Dowd LLP; and Michael P. Canty and Corban S. Rhodes of Labaton Sucharow LLP.
The case is In re: Facebook Biometric Information Privacy Litigation, (case number 3:15-cv-03747) in the U.S. District Court for the Northern District of California.
Facebook Agrees To $52 Million Settlement To End Moderators’ Trauma Claims
Facebook Inc. has agreed to pay $52 million to settle claims that the social media giant ignored workplace safety standards and allowed content moderators to sustain significant psychological trauma as a result of the thousands of graphic images they see on the job. The settlement requires Facebook to pay 10,000 content moderators who worked for Facebook’s vendors in California, Arizona, Texas and Florida $1,000 each. The company also agreed to cover treatment costs and to provide more counseling to moderators while they work, the statement says.
Under the settlement, Facebook also agreed to pay for treatment of class members who have been diagnosed with psychological conditions as a result of their work for Facebook, who can potentially receive up to $50,000 in additional damages, depending on the amount remaining in the settlement fund after screening and treatment payments.
Additionally, Facebook has agreed to require Facebook’s vendors to provide coaching sessions with licensed mental health counselors and other mental health support, as well as enhance review tools designed to make content moderators’ work safer.
If approved, the settlement would resolve a proposed class action that moderator Selena Scola filed in California state court in September 2018. Ms. Scola says she developed post-traumatic stress disorder from moderating content on Facebook.
Ms. Scola alleged that she and other content moderators were denied protection against the severe psychological trauma that can result from repeated exposure to graphic content like child sexual abuse, beheadings, terrorism and animal cruelty.
Scola’s suit is one of several against Facebook and its contractors, including Pro Unlimited Inc. and Cognizant Technology Solutions U.S. Corp., demanding that content moderators be provided with mental health screening, treatment and compensation as well as improved working conditions.
The moderators are represented by Joseph R. Saveri, Steven N. Williams, Gwendolyn R. Giblin, Kevin E. Rayhill and Kyle P. Quackenbush of Joseph Saveri Law Firm; Korey A. Nelson, Lydia A. Wright, Amanda Klevorn, H. Rick Yelton, Warren Burns and Kyle Oxford of Burns Charest LLP and William Most. The case is Selena Scola et al. v. Facebook Inc., (case number 18-CIV-05135) in the Superior Court of California, County of San Mateo.
Judge Initially Approves GM’s $120 Million Settlement To End Driver Ignition Claims
A New York federal judge has preliminarily approved General Motors’ $120 million settlement to end multidistrict litigation (MDL) with drivers who claim their cars lost value due to faulty ignition switches, ruling that the settlement is fair and that it will likely be granted final approval.
The settlement that U.S. District Judge Jesse M. Furman preliminarily signed off on includes a $70 million common fund for drivers. Class counsel plans to seek up to $34.5 million in attorney fees. At press time, no one has filed an objection to preliminary approval of the settlement. If granted final approval, the settlement would resolve class allegations that GM LLC and its predecessor General Motors Corp., which filed for bankruptcy in 2009, are both responsible for “egregious” failures to design safe switches for Chevrolet, Pontiac, Cadillac and other vehicle brands.
The suit alleges the alleged design flaw causes keys to slip out of position, thereby shutting off the engine and disabling brakes while operating the vehicle and potentially preventing the airbags from inflating. The Plaintiffs allege “GM aggressively covered up the problem and stymied customers seeking fixes.”
GM announced the proposed settlement in March. Pursuant to the settlement, a trust, referred to as the GUC Trust, controlled by creditors in the company’s 2009 bankruptcy, will contribute up to $50 million. However, the settlement was held up after the GUC trust and a different GM bankruptcy trust – the Avoidance Action Trust (ATTO), which was formed to prosecute claims on behalf of creditors – clashed on the proposed settlement’s terms.
The AAT argued that the proposed settlement agreement failed to provide finality for all interests involved. But the parties reached a compromise in April in which the AAT agreed to fund the economic-loss settlement by paying $2.2 million in exchange for “broad mutual releases” from “all potential claims.” Judge Furman cleared the way for the settlement at an April hearing by taking jurisdiction over both federal court and bankruptcy court “economic loss” claims in the nearly five-year-old litigation. He then preliminarily approved the deal.
Judge Furman also gave class members 90 days to submit a claim. Any person who wants to opt out must do so by mailing a “written, hand-signed request” by Oct. 19. Objections to the settlement must be submitted to the court by Nov. 23. A hearing on the settlement’s final approval is set for Dec. 18, 2020.
I feel compelled to point out that this litigation and the resulting settlement would likely never have happened had it not been for the courage of Ken and Beth Melton who took on GM after the tragic death on March 10, 2016 of their daughter Brooke. GM’s defective ignition switch was discovered in the lawsuit Lance Cooper, along with a team of Beasley Allen lawyers, successfully handled for the Melton family. It was during the Melton case that the bad conduct of GM was initially and fully exposed. All the damaging internal documentation was received from GM during extensive discovery in the Melton case.
Hyundai’s Offer To Settle Engine Defect Suits Gets Initial Approval
A California federal judge has granted conditional, preliminary approval of Hyundai and its affiliate Kia’s agreement to end a consolidated group of proposed class actions over a defect in engines of millions of cars that caused some of them to burst into flames. U.S. District Judge Josephine L. Staton noted that the parties have not “quantified” the proposed settlement’s value, but the companies announced in the fall they had set aside $758 million to settle class actions in the U.S. and South Korea.
The proposed settlement does grant preliminary certification of 4.1 million class members and offers details on proposed relief, including reimbursement for certain out-of-pocket repairs and costs, a lifetime warranty extension and other perks like receiving a comparable loaner vehicle while their car is being repaired under the lifetime warranty.
Although the total value of the settlement is not finalized, Judge Staton said that “in light of the comprehensive nature of the consideration offered as well as the obvious value of the lifetime warranty extension, the court finds that the amount offered in settlement weighs in favor of approval at this preliminary stage.” The Plaintiffs have also stated that the proposed settlement provides class members with “virtually everything” they sought in their complaints.
The suit, by drivers of Hyundai and Kia models with Theta II gasoline direct injection engines, accused Hyundai and Kia of not disclosing defects or issuing needed recalls until January 2018, almost two years after the National Highway Traffic Safety Board (NHTSA) began investigating reports of engine fires and two months after company executives were asked to attend a Senate Commerce Committee hearing on the issue. The suits all similarly allege there were manufacturing or design defects in certain Hyundai Motor Co. and Kia Motor Corp. vehicles equipped with gas direct injection engines that caused the engines to seize, fail or potentially catch fire.
The cars included in the proposed settlement include Hyundai model years 2011-19 Sonatas, 2013-18 Santa Fe Sports and 2014-19 Tucsons, as well as various Kia models over a similar period including Sportage, Sorento and Optima vehicles. “The allocation of settlement funds also appears fair, adequate, and reasonable,” Judge Staton said. “Each class member is equally entitled to all forms of consideration offered in the proposed settlement. Considering the difficulties and expenses class members would face to individually pursue litigation and the likelihood that they may otherwise be unaware of their claims, this weighs in favor of preliminary approval.”
The drivers are represented by Steve Berman of Hagens Berman Sobol Shapiro LLP, Matthew D. Schelkopf of Sauder Schelkopf, Adam Gonnelli of The Sultzer Law Group PC and Bonner Walsh of Walsh PLLC. The cases are In re: Hyundai and Kia Engine Litigation, (case number 8:17-cv-00838) in the U.S. District Court for the Central District of California.
Medical Supplier Gets Initial Approval For $35 Million Investor Settlement
Medical supplier Henry Schein Inc. has received initial approval in a New York federal court for a $35 million settlement to end an investor class action accusing the company of hiding an anti-competitive scheme that ended up adversely affecting the company’s stock price. U.S. District Judge Margo K. Brodie preliminarily approved the settlement that ends litigation that started with an individual shareholder suit in March 2018.
The settlement was reached with the City of Miami General Employees’ & Sanitation Employees’ Retirement Trust, which became lead Plaintiff in the case. It’s alleged in the suit that Henry Schein knew about a scheme with its competitors not to offer discounts on supply sales to buyer groups representing small dental practices, but kept that information from investors to inflate the company’s stock price. Investors sued over losses that occurred when the Federal Trade Commission (FTC) started an enforcement action.
A class will be formed solely for the purpose of disbursing the settlement, according to the judge’s order. The class will include all persons and entities who purchased or otherwise acquired Henry Schein common stock from March 7, 2013, through Feb. 12, 2018, “and who were damaged thereby.” Shareholder Joseph Salkowitz claimed in March 2018 that Henry Schein’s executives knew the scheme was in place, but hid its existence from the investing public until the FTC acted.
Judge Brodie said that notice could be sent to the settlement class and that a fairness hearing will be scheduled, possibly by phone, on the preliminary settlement agreement.
The Plaintiffs are represented by James A. Harrod and Michael M. Mathai of Bernstein Litowitz Berger & Grossmann LLP and Robert D. Klausner and Stuart A. Kaufman of Klausner Kaufman Jensen & Levinson.
The case is In re Henry Schein Inc. Securities Litigation, (case number 1:18-cv-01428) in the U.S. District Court for the Eastern District of New York.
Brazilian Meatpacker BRF Settles Shareholder Suit For $40 Million
Brazilian meat and food processing giant BRF SA has reached a $40 million settlement to resolve a stock-drop suit claiming it engaged in a widespread bribery scheme to conceal unsanitary practices at its meatpacking facilities. The settlement was submitted to a New York federal judge.
BRF had been accused of engaging in an “unprecedented and massive case of food fraud” including bribery of Brazilian politicians, falsification of laboratory test results and improper use of additives and chemicals. The company’s alleged misconduct resulted in raids of its offices by Brazilian federal police that, when revealed to the public in 2017 and 2018, led to sharp drops in BRF’s share price, according to the proposed securities class action.
The Alabama pension fund leading the suit updated its claims in a fourth amended complaint last fall, alleging that on March 17, 2017, news reports revealed Brazilian federal police had raided dozens of meatpackers, including BRF’s offices, in connection with a two-year bribery investigation.
Known as “Operation Weak Flesh,” the investigation uncovered at least 40 cases of meatpackers that had bribed inspectors and politicians to “overlook unsanitary practices, reassign dishonest health inspectors, and obtain fraudulent health certifications for their products.” Three BRF employees, along with numerous public officials, were arrested in connection with the investigation. BRF’s share price fell nearly 8% on the day the raids were reported.
The wider investigation continued over the course of the next year, and on March 5, 2018, a Brazilian court authorized another round of raids at BRF’s facilities after finding evidence that its senior executives took steps to avoid legitimate food safety checks, the investors claim. The court ruling also found that BRF had sent chicks with salmonella to contract farmers and provided those farmers with an additive-laced poultry feed supplement.
It was also reported on March 5, 2018, that BRF’s former CEO and other executives had been arrested in connection with the investigation, leading BRF’s stock price to fall nearly 20% by the end of the day, the complaint alleges.
The settlement reached would provide a $40 million payment to investors who acquired BRF’s American depositary receipts between April 2013 and March 5, 2018. It should be noted that the settlement contains no admission of wrongdoing by the Defendants.
The investors are represented by Samuel Rudman, David A. Rosenfeld, Mario Alba Jr. and Christopher T. Gilroy of Robbins Geller Rudman & Dowd LLP.
The case is In re BRF S.A. Securities Litigation, (case number 1:18-cv-02213) in the U.S. District Court for the Southern District of New York.
$500 Million IPhone Settlement Gets Approval
A California federal judge has preliminarily approved Apple’s $500 million settlement to end multidistrict litigation (MDL) accusing the company of releasing software updates that slowed down the performance of certain iPhones, but extended the final approval deadlines in light of the coronavirus pandemic.
During a hearing held via Zoom’s videoconferencing tool, U.S. District Judge Edward J. Davila told the parties he wants to extend the final approval deadlines by a few weeks due to the COVID-19 crisis. The judge told the parties to meet and confer about proposing a new date for a final settlement approval hearing that would take place sometime in December.
If approved, the settlement would resolve dozens of lawsuits that were transferred to Judge Davila in April 2018 and consolidated the following May, after Apple admitted to occasionally slowing iPhones with older batteries to avoid unexpected shutdowns.
The suits generally allege that the company released a software update that diminished the battery life of older iPhones, just as it rolled out new models. The bugs allegedly prompted some customers to spend hundreds of dollars on new phones.
During more than two years of litigation, Judge Davila granted Apple’s motion to dismiss the consumers’ battery performance and overseas false advertising claims. The judge also rejected arguments that the computer giant was liable for breaking federal hacking laws. The company’s bid to dismiss computer intrusion claims, among others, were denied by Judge Davila.
Under the proposed settlement, Apple has agreed to pay up to $500 million in total, depending on the amount of iPhone users to participate in the deal. Class members would receive $25 each for their phones. If the payouts, attorney fees and expenses don’t add up to at least $310 million, class members will receive up to $500 apiece until that minimum settlement amount is reached.
The settlement only applies to individuals who performed certain software updates on their Apple iPhone 6, 6 Plus, 6s, 6s Plus, 7, 7 Plus and SE devices, and not all owners of those phones.
The consumers are represented by Mark Molumphy, Joseph W. Cotchett, Brian Danitz and Anya Thepot of Cotchett Pitre & McCarthy LLP, Frederic S. Fox, David A. Straite, Donald R Hall and Laurence D. King of Kaplan Fox & Kilsheimer LLP and Terrence Edwards.
The case is In Re: Apple Inc. Device Performance Litigation, (case number 5:18-md-02827) in the U.S. District Court for the Northern District of California.
Equifax Agrees To $30 Million Settlement With Credit Unions Over Data Breach
Equifax Inc. has agreed to pay $5.5 million to a putative class of thousands of banks and credit unions, and to spend at least $25 million on the financial institutions’ data security, to end their claims in multidistrict litigation (MDL) stemming from a massive 2017 data breach.
The proposed class includes all U.S. banks and credit unions that issued credit or debit cards whose information was believed to have been breached. The banks will be able to request $4.50 per breached card under the proposed settlement.
Some of the security measures that the $25 million will go toward include continuing to identify threats to personally identifiable information and performing data security risk assessments. Equifax also agreed to cover settlement administration and notice costs, attorneys’ fees, expenses, and named Plaintiff service awards.
The banks and credit unions said Equifax knew that the hacking of its systems was foreseeable and that its internal security was inadequate.
Equifax contended in July 2018 that the financial institutions lacked Article III standing as they had not shown that they had experienced an actual injury, such as a fraudulent transaction being made using the personal data of their customers, as opposed to the speculative risk that a hacker may choose to use a customer’s personal data. But the banks countered by saying in September 2018 that the risk of future injury is enough to confer Article III standing. They said the risk from future “fraudulent banking activity” is significant and directly traceable to the data breach, which saw the personal data of more than 140 million Americans leaked.
The financial institutions are impacted the most by identity theft, as they “bear the risk of loss when identity thieves use a customer’s [personally identifiable information] to open accounts, transfer funds, take out loans, make fraudulent transactions or obtain credit or debit cards in the customer’s name,” the banks and credit unions said.
Equifax also owed the financial institutions a duty under Georgia law not to subject them to an “unreasonable risk of harm.” It was the credit reporting agency’s own actions that led to the increased risk of a data breach. Given the nature of its business, Equifax had assumed a duty to safeguard the personal data of bank and credit union customers, with the institutions relying on the “security and accuracy” of that data to carry out their business.
The banks and credit unions are represented by Joseph P. Guglielmo of Scott & Scott Attorneys at Law LLP, and Gary F. Lynch of Carlson Lynch Sweet Kilpela & Carpenter LLP.
The MDL is In re: Equifax Inc. Customer Data Security Breach Litigation, (case number 1:17-md-02800) in the U.S. District Court for the Northern District of Georgia.
THE CONSUMER CORNER
Senators Say Safety Regulations Must Precede COVID-19 Business Immunity
Republican and Democratic senators agreed at a panel hearing on May 12 that the federal government needs to issue enforceable workplace standards before any federal law can be passed that would shield businesses from civil lawsuits in connection with worker and customer COVID-19 infections.
During a Senate Judiciary Committee meeting to discuss a possible liability shield for businesses – a topic that Senate Majority Leader Mitch McConnell, R-Ky., has said will be a top Republican priority for the next coronavirus relief bill – senators on both sides of the aisle expressed concerns that there is no de facto standard of care since safety guidelines issued by the Centers for Disease Control and Prevention (CDC) and the Occupational Safety and Health Administration (OSHA) are merely recommendations that are not enforceable. Committee Chairman Lindsey Graham, R-S.C., said:
The sooner we can come up with a regulatory, OSHA-driven process to allow big, small and intermediate businesses [guidance], the better off we’ll be.
At the hearing, witnesses representing employers and employees said they would all welcome clear, enforceable and industry-specific guidelines for business operation best practices.
The panel’s top Democrat, Sen. Dianne Feinstein of California, said it is critical for the federal government to issue specific coronavirus-related standards for workplaces. She added:
But so far OSHA has failed to do so. Furthermore, it has been reported that the [Trump] administration is preventing the CDC from issuing its own detailed guidelines on how to safely reopen businesses.
David Vladeck, a Georgetown University Law Center professor, testified that enforceable regulatory guidelines will allow companies to mount a regulatory compliance defense should they be sued over an infection. He stated:
We urgently need science-based COVID-19 enforceable guidelines from public health agencies. Those guidelines not only safeguard the public but at the same time they provide the standards of liability. Compliance with those guidelines would eliminate any liability risk.
Professor Vladeck also testified that granting immunity to businesses is unnecessary because Plaintiffs bringing COVID-19 infection cases must overcome the substantial legal hurdle of establishing causation. He explained that the lack of a robust contact tracing system in the U.S. makes it virtually impossible for a retail customer to prove he or she was infected at any given establishment. He added:
Someone who has been out and about on the streets and contracts the virus, there’s no way in the world they will be able to say it’s Mr. Smith’s fault.
Sen. Patrick Leahy, D-Vt., stated that if a “bad actor” business knows it can’t be sued, “there’s not much of an incentive for them to do the things they should do.” The sweeping Democratic proposal for the next relief bill, which was passed on May 15 by the U.S. House of Representatives, and sent to the Senate does not include a liability shield.
Giving blanket immunity to Corporate America at any time, including the current health and economic crisis, would be a disaster for the American people. Over the years we have seen examples of how corporate greed and lack of safety and health concerns have caused major problems for people in this country. The best example during the current Coronavirus crisis is found in the large meat-packing facilities where workers are at great risk of being infected with the Coronavirus. The workers have been forced back into an extremely hazardous situation in a number of facilities and lives are being lost. Hopefully, Congress will proceed with great caution and concern before it provides any type immunity to corporate wrongdoers during this crisis.
U.S. Chamber Lobbies Against Small Businesses With Business Interruption Claims
The U.S. Chamber of Commerce is taking a stand against small businesses struggling to survive coronavirus lockdowns by siding with insurance companies that are denying pandemic-related business interruption claims. Based on its past, this conduct should not come as a surprise. The U.S. Chamber has consistently ignored the needs of small businesses in its quest to support huge corporations.
One of the most powerful and aggressive lobbying forces in the country, the U.S. Chamber sent a letter to Congress on April 29 urging two House committees to place the staggering financial burden of floating small businesses on U.S. taxpayers, either through a federal trust fund or government-sponsored insurance.
Restaurants, bars, bakeries, daycare centers, specialty shops, salons, and gyms are some of the small businesses that have been blindsided by denied business interruption claims after state and local governments forced shutdowns of all “nonessential” companies.
Many insurers have shielded themselves from pandemic-related claims with the inclusion of language in the small print of their policy terms excluding “loss or damage caused by or resulting from any virus, bacterium, or other microorganism.” Other policies don’t specifically cover losses related to global pandemics.
The blanket denial of business interruption claims has prompted several states to introduce legislation that would mandate insurance companies to pay the claims at least partially – an idea that the White House has said it supports.
President Trump had this to say on the subject:
You have people that have never asked for business interruption insurance, and they have been paying a lot of money for a lot of years for the privilege of having it, and then when they finally need it, the insurance company says, ‘We’re not going to give it.’ We can’t let that happen.
The U.S. Chamber has the resources to buy political favors on Capitol Hill. In 2019 alone, it spent $77 million on lobbying efforts – more than the amount spent by 5,500 other special interest groups, according to the Center for Responsive Politics, a nonprofit, nonpartisan organization that tracks the effects of money and lobbying on elections and public policy.
In its letter to Congress, the U.S. Chamber asserts that mandating pandemic coverage in business interruption policies isn’t only unconstitutional, it would devastate the insurance industry.
Such bold assertions may be hyperbole, but several legislators backing measures that would work for business say the insurance industry shouldn’t be allowed to collect millions of dollars and then “cut and run” when it’s time to pay on claims.
Bob Hunter, a former Texas insurance commissioner and current director of insurance at Consumer Federation of America, told USA Today that court battles over coronavirus coverage are likely to last for years. He said the lobbying dollars flowing to the U.S. Chamber of Commerce from small businesses are being used against them. “We’re paying to build our own scaffold for where they’re going to hang us,” Mr. Hunter said.
Beasley Allen lawyers are actively pursuing cases with clients whose insurance companies denied their business interruption claims. Dee Miles, Head of our Consumer Fraud & Commercial Litigation Section, Rachel Boyd and Paul Evans are spearheading this litigation for our firm. If you would like to discuss a potential claim, you can contact them at 800-898-2034 or by email at Dee.Miles@beasleyallen.com, Rachel.Boyd@beasleyallen.com or Paul.Evans@beasleyallen.com.
FDA Issues Emergency Use Authorization For Potential COVID-19 Treatment
On May 1, the United States Food and Drug Administration (FDA) issued an emergency use authorization for the investigational antiviral drug remdesivir. The emergency use authorization (EUA) allows for remdesivir to be distributed in the United States and administered intravenously by health care providers to treat both suspected or laboratory-confirmed COVID-19 in adults and children hospitalized with severe disease. Severe disease is defined as patients with low blood oxygen levels or needing oxygen therapy or more intensive breathing support such as a mechanical ventilator.
Remdesivir is manufactured by Gilead Sciences, Inc. According to Gilead, “remdesivir is an investigational nucleotide analog with broad-spectrum antiviral activity – it is not approved anywhere globally for any use.” Although it has previously been used to treat Ebola, Gilead describes remdesivir as an “experimental medicine that does not have established safety or efficacy for the treatment of any condition.”
The issuance of an EUA is different than FDA approval. In determining whether to issue an EUA, the FDA evaluates the available evidence and carefully balances any known or potential risks of any unproven products with any known or potential benefits of making them available during the emergency. In a statement, the FDA declared that based on its evaluation of the EUA criteria and the scientific evidence available, “it was determined that it is reasonable to believe that remdesivir may be effective in treating COVID-19, and that, given there are no adequate, approved or available alternative treatments, the known and potential benefits to treat this serious or life-threatening virus currently outweigh the known and potential risks of the drug’s use.” The EUA will be effective until the declaration from the Secretary of the U.S. Department of Health and Human Services (HHS) that circumstances exist justifying the emergency use of drugs for prevention of COVID-19 is terminated and may be revised or revoked if it is determined the EUA no longer meets the statutory criteria for issuance.
The FDA’s issuance of the EUA came two days after a clinical trial sponsored by the National Institutes of Health (NIH) showed what HHS Secretary Alex Azar described as promising results. Although the clinical trial is still ongoing, the NIH released preliminary data showing that the study met its primary outcome of statistically significant improvement in time to recovery by Day 29. According to the NIH, patients who were treated with remdesivir also showed a median time to recovery of 11 days compared with 15 days for those who received the placebo. Recovery in the study was defined as being well enough for hospital discharge or returning to normal activity level. Patient enrollment for the Adaptive COVID-19 Treatment Trial (ACTT) began on Feb. 21, 2020, and concluded on April 19.
On the same day that data from ACTT was released, The Lancet published results showing that remdesivir failed to show clinical improvement in severely infected patients in a Chinese Phase III trial. In that study, the primary endpoint was time to clinical improvement up to day 28, defined as the time from randomization to the point of a decline of two levels on a six-point ordinal scale or clinical status (from 1=discharged to 6=death) or discharged alive from hospital whichever came first.
The average time to clinical improvement was 21 days for patients in the remdesivir group, compared with 23 days in the placebo group. However, according to the study authors “the numerical reduction in time to clinical improvement in those treated earlier requires confirmation in larger studies.” Twenty-eight days after treatment, 22 of 158 patients (13.9%) in the remdesivir cohort died compared to 10 of 78 untreated control patients (12.8%). The authors concluded this difference was not statistically significant.
Gilead is one of many companies currently attempting to develop a vaccine for COVID-19. Additional companies include GeoVax, Inc., BravoVax Co. Ltd., Regeneron Pharmaceuticals, Inc., and Inovio Pharmaceuticals, Inc.
Sources: U.S. Food & Drug Administration, Law360.com, Clinicaltrials.gov and Gilead.com
3M Wins Its Injunction Over COVID-19 Price-Gouging
3M Company accused Performance Supply LLC of violating federal trademark law and grossly inflating the price of N95 protective masks amid the COVID-19 pandemic. 3M has filed a lawsuit alleging that Performance Supply is using the 3M trademark to perpetrate a false and deceptive price-gouging scheme on unwitting consumers, including agencies of government, in connection with the attempted sale of 3M’s N95 respirators.
3M is a provider of scientific, technical, and marketing innovations throughout the world, with a line of more than 60,000 goods and services ranging from household and school supplies to medical devices and equipment. In the lawsuit, 3M claims that Performance Supply, a company that purportedly operates out of Englishtown, New Jersey, was selling N95 masks at four to six times their actual cost while implying that 3M approved the price hike.
Performance Supply allegedly attempted to deceive New York City procurement officers into purchasing 7 million of 3M’s N95 respirators for 500% more than 3M’s actual list price and illegally used 3M’s distinctive red-letter logo in the attempted sale. As a result of Performance Supply’s conduct, New York City procurement officers were led to believe that Performance Supply was authorized to send out formal bids on 3M’s behalf, which it was not.
In April of this year, 3M filed suit against Performance Supply in federal court in the Southern District of New York. In its Complaint, 3M seeks relief for Performance Supply’s violation of (i) various federal and state trademark laws; (ii) federal and state laws prohibiting unfair competition, false association, false endorsement, false designation of origin, and other deceptive acts and practices; (iii) federal and state laws against false advertising; and (iv) claims involving injury to business reputation. 3M sought a preliminary injunction against Performance Supply and by May 4, 2020, U.S. District Judge Loretta A. Preska in Manhattan ruled in favor of 3M, granting the injunction.
Judge Preska held that Performance Supply is not an authorized distributor, vendor, agent, or representative of 3M, and is not authorized to solicit orders of any size for 3M’s N95 respirators. According to the Judge’s ruling, Performance Supply “is trading off the widespread commercial recognition and goodwill” of 3M by using its branding to sell N95 masks. Judge Preska enjoined Performance Supply from using 3M’s name, stating in her ruling:
The public has an interest in avoiding confusion about the source and quality of goods and services. This is especially true during the global COVID-19 pandemic, when consumers, including experienced governmental procurement officials, are relying on the 3M Marks and 3M Slogan to indicate that goods and services offered thereunder originate from 3M, and are of the same quality that consumers have come to expect of the 3M brand.
As a result of the injunction, Performance Supply is prohibited from using the 3M marks and 3M slogan, and any other word or symbol that is similar to the marks and slogan. The Court’s preliminary injunction also enjoined Performance Supply from engaging in any false, misleading, and/or deceptive conduct in connection with 3M, including representing itself as being an authorized vendor of 3M products or having an affiliation with 3M, and falsely representing that 3M has increased the prices of its 3M-brand N95 respirators.
While New York City eventually did not place the order of 7 million N95 masks, had it done so, the municipality would have been up-charged by $30 million during this COVID-19 crisis.
Opportunistic companies seeking to exploit the increased demand for respirators by price-gouging and committing unfair and deceptive acts at the expense of health care workers, first responders, and citizens of this country in the midst of a national pandemic is shameful. Beasley Allen has a long history of representing consumers, states and municipalities in massive fraud schemes that target the most vulnerable aspects of our nation’s health care needs. If you have any questions about our firm’s health care and consumer fraud practice, contact Dee Miles, Ali Hawthorne, or James Eubank, lawyers in our Consumer Fraud & Commercial Litigation Section, at 800-898-2034 or by email at Dee.Miles@beasleyallen.com, Alison.Hawthorne@beasleyallen.com, or James.Eubank@beasleyallen.com.
Apotex To Pay $24 Million Criminal Fine In DOJ Price-Fixing Case
Canadian drugmaker Apotex Corp. will pay a $24 million criminal penalty to settle felony allegations that it conspired to jack up the price of a popular cholesterol drug. The U.S. Department of Justice (DOJ) announced the settlement on May 7.
According to the DOJ, a deferred prosecution agreement filed in a Pennsylvania federal court includes the penalty and an admission by Apotex “that it conspired with other generic drug sellers to artificially raise the price of pravastatin,” which belongs to the widely used class of cholesterol-lowering statin drugs.
Apotex will also assist the government in its sprawling pharmaceutical price-fixing investigation, which has led to antitrust charges against three other generic-drug makers that also signed deferred prosecution agreements. Four individuals have also been charged; three have pled guilty and one is awaiting trial, according to the DOJ.
Apotex has agreed to help government lawyers who are examining possible “violations of federal antitrust and related criminal laws involving the production and sale of generic drugs in the United States,” according to the deferred prosecution agreement. U.S. Attorney William McSwain said in a statement:
Compromising the health and welfare of innocent people by artificially inflating the price of a much-needed medication is not only morally wrong but illegal. Preying on the public in this manner for the sake of financial gain is something that must be rooted out of the pharmaceutical industry.
The DOJ accused Apotex of participating in the purported conspiracy from May 2013 to December 2015. The deferred prosecution agreement will last three years.
According to the government, Apotex was able to stamp out competition for pravastatin, and it sold $105 million worth of the drug. Roberta Loomar, Apotex’s U.S. general counsel, said in a statement:
This activity, occurring several years ago, was clearly against our established compliance policies, training and culture. With this resolution, we are highlighting our commitment to continually improve our compliance and training programs, as well as evolve our controls to ensure full compliance with all antitrust laws.
There have been other resolutions so far in the DOJ’s broader investigation. Those have included a $195 million criminal penalty against Sandoz Inc., a $3 million payment from Rising Pharmaceuticals Inc. and an agreement for cooperation with Heritage Pharmaceuticals Inc. Separately, there is also multidistrict price-fixing litigation in which numerous drug companies are being sued for damages by states, consumers, pharmacies, health insurers and union benefit plans.
The government is represented by William M. McSwain of the U.S. Attorney’s Office for the Eastern District of Pennsylvania and Carsten M. Reichel, Mark C. Grundvig, Tara M. Shinnick and Julia M. Maloney of the U.S. Department of Justice’s Antitrust Division.
The case is U.S. v. Apotex Corp., (case number 2:20-cr-00169) in the U.S. District Court for the Eastern District of Pennsylvania.
Liability Of Cruise Ship Lines
In November 2019, the first known diagnosis of a new strain of the coronavirus, COVID-19 was made in Wuhan, China. Fast forward to January 2020 and the first COVID-19 case was identified in the United States.
As we have watched this historic drama unfold in this country and around the world, one thing has stood clear – a large number of individuals have contracted the viral disease while traveling on cruise ships. In early March of this year, it was reported that 21 passengers aboard the Grand Princess had tested positive for this strand of coronavirus. Three days later, it was reported that one of the passengers died from the virus.
According to a USA Today report (publ. April 2, 2020; Cara Kelly), two of the passengers, Ronald and Eva Weissberger, aboard the ship were the parents of Debi Chalik, a lawyer from Florida. Ms. Chalik, believing that the cruise line failed to take appropriate steps to protect her parents, filed suit on their behalf.
The problem with this litigation, as has been reported, is an antiquated federal maritime law that protects ships that operate in navigable waters. The law, which existed prior to the sinking of the Titanic, is referred to as Death on the High Seas Act. The law, passed in 1920, limits loss to physical injuries only and precludes recovery for other species of damages, such as mental anguish and pain and suffering.
Even older laws, such as the Limitation of Liability Act of 1851 (yes, dating back to the mid-1800s), allow vessel operators and owners to limit their exposure to the value of their ships, disallows class actions, and sets a very short statute of limitation (injured persons typically have one year from the date of injury or exposure to file suit). This limitation has not deterred Ms. Chalik. She has been retained by a large number of ship passengers, including passengers from the Ruby Princess, an Australian ship that saw several hundred confirmed COVID-19 diagnoses.
Ms. Chalik is basing her filed lawsuits, in part, upon a provision in the ticket issued to passengers that permits lawsuits to be filed in the event of “immediate danger.” The lawsuits filed by Ms. Chalik claim that such a danger existed because the cruise line was put on a notice well before the ensuing cruise and that resulted in, for example, more than 700 people becoming infected on the Diamond Princess, with nine deaths being reported. The lawsuits further contend that Princess Cruises acted grossly negligent when they permitted more passengers to board a ship that was known to have been infected on previous cruises, resulting in more than 100 additional confirmed exposures and additional deaths.
Michael Winkleman, a lawyer from Miami, Florida, filed a class action lawsuit against Costa Cruises, a subsidiary of Carnival Cruise Lines, on behalf of all passengers of the Costa Luminosa. The proposed class action lawsuit claims that the cruise line failed to notify and protect its passengers about the risks of exposure to the virus and to take appropriate measures to protect the passengers of the ship.
The lawsuit alleges that a prior Italian passenger had symptoms consistent with the virus and then tested positive, but that the cruise line failed to notify the oncoming passengers of this important fact. The result, the lawsuit alleges, is that more than 2,000 people have been exposed with a reported seven people having now lost their lives.
If you need more information on any aspect of the matters discussed above, contact Ben Locklar, a lawyer in our firm’s Personal Injury & Products Liability Section, at 800-898-2034 or by email at Ben.Locklar@beasleyallen.com.
CURRENT CASE ACTIVITY AT BEASLEY ALLEN
Beasley Allen has been able to keep things moving during the current pandemic crisis. Taking care of our clients’ cases and their need for justice are very important and our lawyers and support staff have been hard at work. The following is the latest update on the types of cases that Beasley Allen lawyers are currently working on. The firm operates in four separate Sections with each Section focusing on a specific area of litigation. The four Sections are Personal Injury & Products Liability, headed by Cole Portis; Mass Torts, headed by Andy Birchfield; Toxic Torts, headed by Rhon Jones; and Consumer Fraud & Commercial Litigation, headed by Dee Miles. Information on the current litigation will be set out below for each Section.
Personal Injury & Products Liability Section
The personal Injury & Products Liability Section is handling cases in a number of areas. Currently, the Section has 18 lawyers and 31 support staff. Sloan Downes is the Section Director. The lawyers and support staff are working on the areas of litigation set out below. The primary lawyer contact will be listed for each type case. Following is the list of current activity in the Section.
Product Liability – We continue to focus on accident cases involving automobiles, heavy equipment and consumer products. Some of these auto cases involve single-vehicle crashes, while others involve multiple-vehicle accidents. We would like to review any case involving catastrophic injury or death. Contact: email@example.com, firstname.lastname@example.org, email@example.com, firstname.lastname@example.org, email@example.com, firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Truck Accidents – There are significant differences between handling an interstate trucking case and other car wreck cases. It is imperative to have knowledge of the Federal Motor Carrier Safety Regulations, technology, business practices, insurance coverages, and to have the ability to discover written and electronic records. Expert testimony is of utmost importance. Accidents involving semi-trucks and passenger vehicles often result in serious injuries and wrongful death. Trucking companies and their insurance companies almost always quickly send accident investigators to the scene of a truck accident to begin working to limit their liability in these situations. Our lawyers, staff and in-house accident investigators immediately begin the important task of documenting and preserving the evidence. We would like to review any case involving catastrophic injury or death. Contact: email@example.com, firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
On-the-job Product Liability – Many times product claims arise from worker’s compensation claims. After we investigate the circumstances that caused the injuries, many times we discover a defective machine may be the cause of the injuries. Contact: email@example.com or firstname.lastname@example.org.
Boeing Litigation – Lawyers in the Section, led by Mike Andrews, are investigating and filing suits arising out of the two crashes involving Boeing planes that have received tremendous public interest and concern. The first suit was filed on June 13. Mike is handling the litigation and has filed several other lawsuits. Others are being prepared for filing. Contact: email@example.com.
Aviation Accidents – Aviation litigation can be extremely complex and often involves determining the respective liability of manufacturers, maintainers, retrofitters, dispatchers, pilots and others. In some circumstances, the age of the aircraft involved can limit or completely preclude an injured party from compensation. Soaring through the sky hundreds of miles an hour, thousands of feet above the ground in an airplane or helicopter leaves little room for error. One small mechanical problem, misjudgment or faulty response in the air can spell disaster for air passengers and even unsuspecting people on the ground. We are handling cases involving all types of aircraft, military and civilian. Contact: firstname.lastname@example.org or email@example.com.
Heavy Truck Product Liability Claims – Tractor trailers and other heavy trucks are not required to contain many of the same protections for occupants as smaller passenger cars. They can contain dangerous defects putting the truck driver or passengers at risk of serious injury or death. These trucks many times have particularly weak roofs that crush in rollovers. The passenger compartments are often not protected by effective cab guards, and this allows loads to shift into the truck cab. We would like to review any case involving catastrophic injury or death. Contact: firstname.lastname@example.org or email@example.com.
Defective Tires – Tire failure can result in a serious car crash and even a vehicle rollover accident, causing serious injury or death to vehicle occupants. Air, heat and sunlight can cause the rubber in tires to break down. When a tire is defective, potentially serious problems like detreads and blowouts can occur long before the tire would be expected to wear out. If the tire failure is the result of design or manufacturing defects, and the manufacturer is aware of the problem, they have an obligation to alert consumers to the potential danger. Contact: firstname.lastname@example.org or email@example.com.
Premises Liability – In premises liability claims, patrons of establishments are often injured because the premises, for some reason, was unsafe. Premises liability claims can take many forms, including when severe injury or death results when a building or structure collapses, merchandise falls, during swimming pool accidents, due to poor lighting, falling debris, unsecured fixtures and furniture that falls or tips over, unsecure drainage that creates drowning or fall hazards, slippery surfaces, and inadequate maintenance. Beasley Allen has successfully handled a number of premises liability cases, and we would like to investigate any cases where severe injury or death results. Contact: firstname.lastname@example.org, email@example.com, firstname.lastname@example.org, or email@example.com.
Negligent Security – Under the law, owners of establishments owe a duty to patrons and guests to ensure that the premises are reasonably safe and secure from anticipated dangers. These cases normally take the form of shootings, fights, stabbings, or other physical violence (including sexual assault) where severe injury or death occurs due to the establishment owner’s failure to take reasonable safety measures. When this occurs, the establishment owner, as well as those contractors charged with security, may be held responsible for the injuries suffered by individuals or groups of individuals on the premises. While the laws vary from state to state, our firm is actively investigating and litigating these cases where severe injury or death results. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Nursing Home Abuse and Neglect – Nursing homes are supposed to be in the business of providing skilled nursing care to elderly and disabled residents. Unfortunately, statistics indicate residents in nursing homes suffer abuse and neglect more and more frequently at the hands of nursing home corporations. In many cases residents have died or have been severely abused as a result of neglect. They may suffer physical abuse, emotional or psychological abuse, or neglect. We are investigating cases involving serious injury or death resulting from nursing home abuse or neglect. Contact: email@example.com.
The Mass Torts Section
The Mass Torts Section is handling a number of cases involving pharmaceuticals and medical devices. Currently, there are 32 lawyers and 87 support staff in the Section. Melissa Prickett, a lawyer, serves as the Section Director. The lawyers and support staff are working in the areas of litigation set out below. The contact lawyer will be supplied in each case. The following are the current areas of litigation in the Section.
Talcum powder and ovarian cancer – As many as 2,200 cases of ovarian cancer diagnosed each year may have been caused by regular use of talcum powder. Talc is a mineral made of up various elements including magnesium, silicon and oxygen. Talc is ground to make talcum powder which is used to absorb moisture and is widely available in various products including baby powder and adult products including body and facial powder. Talc products used regularly in the genital area increase the risk of ovarian cancer. In February 2016, a jury found Johnson & Johnson knew of the cancer risks associated with its talc products but failed to warn consumers and awarded the family of our client $72 million. She died of ovarian cancer after using J&J talc-containing products for more than 30 years. This case was the start of the litigation that followed. Ted Meadows heads up our talc litigation team handling individual claims. Leigh O’Dell heads up the team of lawyers handling the talc multidistrict litigation (MDL). Contact: firstname.lastname@example.org, email@example.com, or firstname.lastname@example.org.
JUUL vaping devices – The use of JUUL and other vaping devices has reached epidemic levels, especially among teenagers and young adults. JUUL and other vape device manufacturers fueled this epidemic by targeting and deceiving youth and adolescents with misleading social media marketing and sweet, fruit-flavored pods containing high levels of nicotine. Use of these products has been associated with numerous adverse health effects, such as seizures, nicotine addiction, nicotine poisoning, breathing problems, behavioral and psychological problems, and other serious health conditions. Contact: email@example.com, firstname.lastname@example.org or email@example.com.
Bone Cement – The type of bone cement used during knee replacement surgery affects the outcome of that surgery. High viscosity bone cement (HVC) boasts shorter mixing and waiting times and longer working and hardening phases, meaning surgeons can handle and apply the cement earlier than with low- or medium-viscosity cements. Although HVC may be more convenient to use, there is mounting evidence that the bond it produces is not as strong. Researchers have observed more early failures with the use of HVC, even when used in combination with a previously well-performing implant. Complications associated with knee replacements performed with HVC include loosening and debonding (where the implant fails to adhere to the cement interface on the shin or thigh bone), which requires revision surgery. Other reported problems include new onset chronic pain and instability. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Zantac – Zantac is used to treat and prevent ulcers in the stomach and intestines. It also treats conditions in which the stomach produces too much acid, such as Zollinger-Ellison syndrome, gastroesophageal reflux disease (GERD) and other conditions in which acid backs up from the stomach into the esophagus, causing heartburn. Zantac was voluntarily recalled from the market on Sept. 13, 2019. We are currently investigating claims for those who used Zantac and were diagnosed with certain types of cancer, including liver, bladder, stomach, colon, kidney and pancreatic cancer. Contact: email@example.com or firstname.lastname@example.org.
Belviq – On Feb. 13, 2020, the FDA issued a Drug Safety Communication requesting that weight-loss drug Belviq and Belviq XR be removed from the market. Based upon the results of a recent clinical trial, the FDA said the potential risk of various cancers, including pancreatic, colorectal, and lung cancers, outweighed any of Belviq’s benefits. The FDA instructed Belviq users to immediately discontinue its use. Sadly, the manufacturers of Belviq, Eisai, Inc., and Arena Pharmaceuticals, were aware that Belviq use was associated with an increased risk of cancer long before Belviq was approved for marketing by the FDA. In fact, their own pre-marketing studies had initially detected the risk, and the FDA had originally refused to approve Belviq for marketing in 2009 due to the risks of cancer. Only after these companies submitted additional or re-evaluated data masking the risk of cancer did the FDA grant regulatory approval for Belvic in 2012. Beasley Allen is investigating cases involving diagnoses of cancer following Belviq use. Contact: email@example.com, firstname.lastname@example.org or email@example.com.
Proton Pump Inhibitors – Proton pump inhibitors (PPIs) such as Nexium, Prilosec and Prevacid were introduced in the late 1980s for the treatment of acid-related disorder of the upper gastrointestinal tract, including peptic ulcers and gastrointestinal reflux disorders, and are available both as prescription and over-the-counter drugs. Beasley Allen is currently investigating PPI-induced Acute Interstitial Nephritis (AIN), which is a condition where the spaces between the tubules of the kidney cells become inflamed. The injury appears to be more profound in individuals older than 60. While individuals who suffer from AIN can recover, most will suffer from some level of permanent kidney function loss. In rare cases individuals suffering from PPI-induced AIN will require kidney transplant. PPIs also have been connected with causing gastric/stomach cancer and Beasley Allen is investigating these cases as well. Contact: firstname.lastname@example.org or email@example.com
Metal-on-Metal Hip Replacement parts – The FDA has ordered a review of all metal-on-metal hip implants due to mounting patient complaints. Problems with metal-on-metal include, but are not limited to loosening, metallosis (ie: tissue or bone death), fracturing, and/or corrosion and fretting of these devices, which require revision surgery. Many patients that require revision surgery due to these devices suffer significant post-revision complications. We are investigating all cases involving metal-on-metal hip implants, including the DePuy Orthopaedics ASR XL Acetabular System and the DePuy ASR Hip Resurfacing System, recalled in August 2010; the Stryker Rejuvenate and ABG II modular-neck stems, recalled in July 2012; the Stryker LFIT Anatomic v40 Femoral Head (recalled August 29, 2016); the Zimmer Durom Cup, and the Biomet M2A “38mm” and M2A-Magnum hip replacement systems, which have not been recalled. Reported problems include pain, swelling and problems walking. Contact: firstname.lastname@example.org or email@example.com.
IVC Filters – Retrievable IVC filters are wire devices implanted in the vena cava, the body’s largest vein, to stop blood clots from reaching the heart and lungs. These devices are used when blood thinners are not an option. Manufacturers include Bard, Cook and Johnson & Johnson. While permanent IVC filters have been used since the 1960s with almost no reports of failure, retrievable IVC filters were introduced in 2003, promoted for use in bariatric surgery, trauma surgery and orthopedic surgery. Risks associated with the retrievable IVC filters include migration, fracture and perforation, leading to embolism, organ damage and wrongful death. Contact: firstname.lastname@example.org or email@example.com.
Zofran – Manufactured by GlaxoSmithKline, Zofran (ondansetron) was approved to treat nausea during chemotherapy and following surgery. Zofran (ondansetron) works by blocking serotonin in the areas of the brain that trigger nausea and vomiting. Between 2002 and 2004, GSK began promoting Zofran off-label for the treatment of morning sickness during pregnancy, despite the fact the drug has not been approved for pregnant women and there have been no well controlled studies in pregnant women. The FDA has received nearly 500 reports of birth defects linked to Zofran. Birth defect risks include cleft palate and septal heart defects. Contact: firstname.lastname@example.org or email@example.com.
Physiomesh – Intended for hernia repair, Physiomesh is a flexible polypropylene mesh designed to reinforce the abdominal wall, preventing future hernias from occurring. Though there are several types of hernias, most occur when an organ or tissue protrudes through a weak spot in abdominal muscles. The condition often requires surgery where mesh, like Physiomesh, which is intended for laparoscopic use, is used to fill in a hole in the abdominal muscle or laid over or under it to prevent any further protrusions. Independent studies have found Physiomesh to lead to high rates of complications including hernia reoccurrence, organ perforation, mesh migration, sepsis and even death. In May 2016, Ethicon issued a market withdrawal of Physiomesh in the U.S. and recalled the product in Europe and Australia. We are currently investigating cases involving serious injury or death as a result of Ethicon’s Physiomesh. Contact: firstname.lastname@example.org.
Consumer Fraud & Commercial Litigation Section
The Consumer Fraud & Commercial Litigation Section has 14 lawyers and 20 support staff. Michelle Fulmer is the Section Director. Lawyers and support staff in the Section are working on the litigation areas set out below. The primary lawyer contact will be supplied for each type case.
Business Interruption Insurance – Many businesses have suffered losses as a result of the Coronavirus, COVID-19. Most all businesses have a form of “Business Interruption” coverage that is designed to cover losses due to unforeseen circumstances out of the control of the business. This virus is a prime example of an event that would trigger this type of coverage. However, insurance companies are already denying coverage for this type of claim. Obviously, the insurance contract language of each policy governs the coverages, but in many cases the insurance companies are denying coverage despite that the policy actually provides coverage. We are actively pursuing these cases already with our clients who received a denial communication from their insurance companies. Dee Miles, Rachel Boyd and Paul Evans are spearheading this litigation and can be reached at email@example.com, firstname.lastname@example.org or email@example.com.
State and Municipalities Litigation – Our firm has represented numerous states throughout the country. These cases have been handled through the Attorneys General and have involved various civil actions. Many times, individuals are barred from bringing a consumer fraud type claim, but the state government is not. We recently concluded litigation in seven of eight states for a recovery dealing with Medicaid fraud. In addition, we are representing five states in related pharmaceutical pricing litigation. For more information, contact firstname.lastname@example.org or email@example.com.
False Claims Act / Whistleblower- We are handling and investigating whistleblower claims of government fraud ranging from Medicare/Medicaid to military contracts, and any other type of fraud involving a government contract. Under the False Claims Act (FCA) the whistleblower is entitled to a percentage of the recovery. Studies show that as much as 10% of Medicare/Medicaid charges are fraudulent. Common schemes involve double-billing for the same service, inaccurately coding services, and billing for services not performed. Additionally, the Commission on Wartime Contracting has warned that the lack of oversight of government contractors has led to massive fraud and waste. Contact: firstname.lastname@example.org, email@example.com, firstname.lastname@example.org or email@example.com.
Pension Plan Litigation (ERISA) – Many large corporations are improperly funding their Employee Benefit plans and / or transferring these Pension Plans to other entities that cannot properly fund the plans. The result is that employees’ life savings for retirement is either lost, compromised or reduced substantially. These transfers and inadequate funding measures are all designed to increase earnings for the corporations at the expense of its employees. Our firm is committed to pursuing the preservation of employee benefits / retirement by challenging these abuses through ERISA litigation and class actions. For more information contact firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Auto Defect Class Actions – We are continuing to work on numerous auto defect class actions against many of the major automobile manufacturers like VW, Toyota, General Motors, Ford and even some suppliers. These cases continue to be filed because of corporate misconduct in designing and manufacturing unsafe vehicles that are purchased by consumers, corporations and state agencies. We continue to investigate these automobile problems for class relief treatment. Contact: email@example.com, firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Life Insurance Fraud – We have uncovered alleged fraudulent accounting practices by life insurance companies concerning premium increases. The accounting method may result in the policyholder being charged excessive insurance premiums. A client that has a life insurance policy and has been notified of a substantial increase in premium payments, or if they have been told their policy’s “cost of insurance” has increased, may have a valuable legal claim that our firm would like to investigate. Contact: email@example.com, firstname.lastname@example.org, or email@example.com.
Property Insurance Fraud – Insurance companies nationwide are unjustly depreciating labor costs on adjusted property claims (roof or fence damage for example). The depreciation of labor costs is contrary to many insurance policy forms and leads to policyholders either being undercompensated for their claims or not compensated at all as they fail to meet their deductible once labor costs are depreciated. If you have had an insurance claim on your property in the past six years, then we would like to review the adjuster’s estimate and your homeowner’s or manufactured home policy as you may have a case. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Supplemental Disability Insurance Denial – We have successfully litigated bad faith denial of benefits cases for years in the disability insurance area and we are interested in reviewing cases involving denial of Individual and Group disability insurance. These cases can be either employee sponsored benefit plan policies (ERISA), individually owned policies or non-ERISA governed supplemental insurance. Contact: email@example.com, firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Health Care Fraud – We are looking into cases of fraud within the health care industry. These may include cases dealing with pricing, off-label prescriptions, or other health care abuse. Contact: email@example.com, firstname.lastname@example.org or email@example.com.
Self-funded Health and Pharmacy Insurance Plans – Third Party Administrators and Pharmacy Benefit Managers may have been charging unauthorized fees to self-funded insurance health and pharmacy benefit plans. These extra fees may be in violation of the contracts with the self-funded plan and a breach of fiduciary duty under ERISA. We are looking into these cases on behalf of self-funded plans. Contact: firstname.lastname@example.org or email@example.com.
Pharmaceutical Pricing – We are continuing to handle claims involving chain pharmacies falsely reporting their generic pricing transactions to state Medicaid agencies. This misconduct has led to millions of dollars in overpayments by Medicaid agencies for generic drugs to the chain pharmacies. Contact: firstname.lastname@example.org or email@example.com.
Antitrust – We are handling claims related to the violation of federal and state antitrust laws. We are currently involved in claims alleging a wide array of anticompetitive conduct, including illegal tying, exclusive dealing, monopolization, and price fixing. Contact: firstname.lastname@example.org, email@example.com, firstname.lastname@example.org or email@example.com.
Sexual Harassment – Sexual harassment is outlawed by Title VII of the Civil Rights Act of 1964 because it is a form of discrimination, as explained by the Equal Employment Opportunity Commission (EEOC). The agency states “[u]nwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature constitute sexual harassment when this conduct explicitly or implicitly affects an individual’s employment, unreasonably interferes with an individual’s work performance, or creates an intimidating, hostile, or offensive work environment.” We are looking at any claim involving extreme sexual harassment or sexual assault. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Employment Law – We are handling employment cases. Situations that may be addressed in this area include minimum wage and overtime pay, unfair labor practices, all types of discrimination, employee benefits, and whistleblower claims. Contact: email@example.com, firstname.lastname@example.org or email@example.com.
Fair Labor Standards Act (FLSA) – We are working several cases involving Fair Labor Standards Act (FLSA) violations. The FLSA cases are brought on behalf of clients whose job title is misclassified by their employers so that employees are not compensated for overtime worked. Cases may also involve unequal pay, where women are paid less for doing the same job as men. Contact: firstname.lastname@example.org, email@example.com, or firstname.lastname@example.org.
Toxic Torts Section
The Toxic Torts Section has a number of ongoing projects at present. Currently, the Section has 10 lawyers and 27 support staff. Tracie Harrison is the Section Director. Lawyers and support staff are working on the areas of litigation set out below. The primary contact lawyer for each type case will be listed.
State and Municipalities Litigation – Our firm is representing the States of Alabama and Georgia in the opioid litigation. We also represent states and certain local governments in environmental or toxic exposure claims. Many times, individuals are either barred from bringing an environmental claim or it is not a practical solution. These types of government cases may involve issues of environmental catastrophe, or some other type of pollution. One of the most notable cases handled by Beasley Allen on behalf of states for environmental issues is the BP Oil Spill litigation. For more information, contact email@example.com.
Opioids – Beasley Allen is representing Alabama and Georgia against both manufacturers and distributors of opioids for increased costs related to the opioid epidemic. These lawsuits allege the crisis was created by the pharmaceutical industry, which instead of investigating suspicious orders of prescription opiates, turned a blind eye in favor of making a profit. They intentionally misled doctors and the public about the risks of these dangerous drugs, and state governments are left struggling to cope with the consequences. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Mesothelioma and asbestos-related diseases – Mesothelioma is a highly aggressive and rare form of cancer usually affecting the lining of the lungs (pleural) or abdominal cavity (peritoneal). Occasionally, it also may affect the lining of the heart (pericardial). The only known cause of mesothelioma is exposure to asbestos. About 2,000 new cases of mesothelioma are diagnosed in the United States each year. For years, asbestos was widely used in many industrial products and in building construction for insulation and fire protection. When asbestos is broken or disturbed it can release microscopic fibers that can be inhaled or ingested, posing a health risk, including the development of asbestos diseases and mesothelioma. Contact: email@example.com.
Defective 3M Earplugs – Beasley Allen lawyers are investigating claims related to defective combat earplugs manufactured by Minnesota-based 3M Company. The earplugs were issued to thousands of military personnel serving in combat in Iraq and Afghanistan and used in training exercises in the United States. Numerous soldiers are now complaining of permanent hearing loss related to the defective ear plugs. Other soldiers have complained of tinnitus, commonly referred to as “ringing” in the ears. The dual-sided earplugs allegedly were improperly designed and manufactured so that the earplugs did not fit snugly in the wearer’s ear canal. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
Leukemia and Benzene exposure – Benzene is widely used in a number of industries and products, yet many people remain unaware of the toxic danger of this chemical substance. Exposure to products containing benzene, whether through inhalation or skin absorption, can cause life-threatening diseases including Acute Myeloid Leukemia (AML), Myelodysplastic Syndrome (MDS), lymphomas and aplastic Anemia. Some of these diseases do not manifest themselves until several years after exposure to benzene. Due to certain statute of limitations for bringing a claim of this nature it is important to contact an attorney as soon as possible if you believe your condition is a result of benzene exposure. Contact: email@example.com.
PFC Contamination in Water Systems – In May 2016, the U.S. Environmental Protection Agency (EPA) issued new lifetime health exposure guidelines for perfluorooctane sulfonate (PFOS) and perfluorooactanoic acid (PFOA) in the water supply. After the EPA issued the new exposure limits, Beasley Allen filed suit for two water systems impacted in Alabama. The EPA advisory focused on PFOA and PFOS, man-made chemical compounds that are used in the manufacture of non-stick, stain-resistant, and water-proofing coatings on fabric, cookware, firefighting foam, and a variety of other consumer products. Contact: firstname.lastname@example.org, email@example.com or firstname.lastname@example.org.
E-cigarette Explosions – We are investigating cases involving severe injuries caused by exploding e-cigarette devices and exploding e-cigarette batteries. These explosions have been linked to faulty e-cigarette products, defective lithium-ion batteries, and insufficient warnings for users. These cases involve personal injury including serious burn injuries. Please contact our Toxic Torts section for assistance with cases you may have involving these devices. Contact: email@example.com.
As we said last month, even with the changes required by the Coronavirus pandemic, our offices are open. You will have no difficulty getting through to a lawyer in our firm when seeking information or assistance on a specific case. However, in the unlikely event you do have difficulty reaching any of the lawyers listed above as the primary contact for a specific type of case, you can contact one of our four Section Directors and she will promptly put you in touch with a lawyer in her Section who is working on the specific case you are asking about.
As we have stated previously, the Section Directors at Beasley Allen do a tremendous job for our firm. The Directors are Melissa Prickett, Mass Torts Section; Sloan Downes, Personal Injury & Products Liability Section; Michelle Fulmer, Consumer Fraud & Commercial Litigation Section; and Tracie Harrison, Toxic Torts Section. The directors can be reached at 800-898-2034 or by email at Melissa.Prickett@beasleyallen.com; Sloan.Downes@beasleyallen.com, Michelle.Fulmer@beasleyallen.com; and Tracie.Harrison@beasleyallen.com.
PRACTICE TIPS OF THE MONTH FOR TRIAL LAWYERS
Beasley Allen lawyers Rob Register and John Tomlinson will provide some practice tips for trial lawyers in this issue.
I believe you will find the information from Rob & John to be helpful. We will start with Rob’s contribution, which deals with a case he handled, to be followed by John’s tips.
Rob Register - Recognizing A Traumatic Brain Injury And Proving It With Medical Certainty
As trial lawyers, we often encounter clients who have suffered some form of brain injury and cognitive deficit. Sometimes these injuries are difficult to recognize and challenging to prove with medical certainty. Our own Rob Register recently settled a case on behalf of a young woman who suffered a profound brain injury that was not readily apparent but had catastrophically altered her life. This young woman could walk, talk and appeared essentially normal if you were to pass her on the street.
When Rob first met our client, she maintained that she could recall long term memories, everything from before the incident that caused her injury. However, since the incident she could not remember anything new for more than a few hours. Similar to the character played by Drew Barrymore in the movie “Fifty First Dates,” it seemed implausible that such a specific brain injury could truly occur in a human being.
Other lawyers had declined to represent this woman, presumably because they did not believe her or take the time to investigate the validity of her brain injury. Rob chose to trust his client and set about to confirm the truth. First, he contacted friends and relatives who knew the woman before and after the incident. He interviewed them separately and heard similar observations of her behavior and memory since the incident.
Rob discovered the story of a vibrant and beautiful 29-year-old who recently completed a master’s degree and started her career. She was single, making good money and she had just purchased her first home. She loved her friends, her job and her life. She dreamed of being successful, traveling, and one day getting married and having kids. The future could not have been brighter for this young woman before her injury.
After her brain injury, the woman could not remember from day to day anything that happened the day before. You could meet her in the morning and she would not remember you by the evening. She could not return to her job as she could not remember the tasks to be performed. Her mother moved in with her and had to leave notes all over the house to remind her to do simple activities of daily living. The worst part is that she is aware of her loss. She has long term memories of her prior life, but now lives with the frustration each day of realizing that she has lost her self. Her dreams of having a career, husband and family were forever ruined.
In an effort to objectively prove this woman’s brain injury, Rob retained the expertise of a neuroradiologist who had published a text book on recognizing brain injury from Magnetic Resonance Imaging “MRI” scans. In addition to single images, an MRI machine can also produce three-dimensional images that may be viewed from several different angles. The unit of measurement used to quantify the strength of a magnetic field in an MRI machine is called a Tesla (T). The expert in this case compiled and reviewed MRI studies of the woman’s brain from high tesla MRI studies. He found areas of brain damage that were measurable and could be seen in the images. His work proved to the Defense that this woman’s injury could be shown objectively to the jury in a manner that was easy to understand.
Additionally, Rob hired a respected neuropsychologist who performed extensive neuropsychological evaluation and testing. This doctor ultimately diagnosed the client with Major Neurocognitive Disorder. In a 17-page report, the doctor identified in detail the client’s significant deficits in both auditory and visuospatial memory. He determined her memory deficits to be in the severely impaired range. The doctor opined that given her residual neurocognitive deficits, difficulties with complex activities, judgment, decision making and navigation problems, the woman would require continued supervision and assistance with medications, financial management, and any matters pertaining to complicated medical, legal, and/or financial decision making. She will also require professional caregiver assistance and transportation assistance for the remainder of her life.
The next step was to engage a life care planner. Rob utilized a neurologist who specializes in treating patients with brain injury. The neurologist traveled to Georgia and spent an entire day with the client and her family to personally observe her in her home environment. He prepared an encompassing life care plan that outlined all the needs associated with the client’s care.
The life care plan was then sent to a forensic accountant who prepared a comprehensive economic evaluation showing the cost to fund the life care plan, as well as the total lost income over the client’s lifetime. This expert quantified a monetary range for the total economic loss suffered by the client and discounted the amounts to present value.
Lastly, Rob allowed the Defense to depose his client. While this may seem risky with an impaired client, in this case there was no better way for the Defense to personally interact with and see the legitimacy of this woman’s brain injury. It was expected that she would answer questions incorrectly, and she did. However, at the conclusion of the deposition, it was evident to everyone in the room that this woman wanted nothing more than to have her prior life back and to pursue her dreams. Tragically, it was also obvious that she did not have the capacity to achieve most of those dreams due to her permanent brain injury.
As Rob prepared for trial, the case settled for an amount that would take care of the client for the remainder of her life and allow her the financial freedom to adapt to her challenges. It was a privilege for Beasley Allen Law Firm to represent this client and to make a meaningful difference in her life.
If you represent a client with a brain injury or if you suspect your client has suffered a brain injury, we welcome the opportunity to investigate the potential claim with you. Contact Rob Register at Rob.Register@beasleyallen.com or Cole Portis at Cole.Portis@beasleyallen.com. Rob is a lawyer in our Atlanta office and Cole heads up the firm’s Personal Injury & Products Liability Section and is located in Montgomery. They can be reached at 800-898-2034.
I’ve observed through the years that successful trial lawyers are great storytellers. The importance of telling your client’s story in a well-developed and consistent narrative is immeasurable in setting the tone at trial and evoking an emotional response from a jury.
A good story is not a just a simple recitation of the facts in chronological order or an explanation of the applicable law at issue, but is also a description of personal life and events, including who your client is, what’s important to them, and how the events at issue in the case have impacted their life.
In the book The Storytelling Animal, the author Jonathan Gottschall suggests that stories help us navigate life’s complex social problems and bind us around common values. The New Yorker summed up the essence of the author’s thesis in observing that “human beings are natural storytellers – that they can’t help telling stories, and that they turn things that aren’t really stories into stories because they like narratives so much. Everything – faith, science, love – needs a story for people to find it plausible. No story, no sale.”
Skipping the important step of developing a strong narrative/story or waiting too long to fully develop it is not a recipe for success. With the technology currently available, attorneys have access to a multitude of tools and visual aids that can go a long way in developing and communicating their client’s story. Visual illustrations of case timelines and critical events as well as pictures and videos that capture personal moments of clients are effective in conveying an overall theme. Be mindful that referencing or reciting too many details of dates, names and other information can oftentimes distract a listener from the central story. Conveying the “Big Picture” is most important.
Each of our clients has their own unique personal story. We as attorneys have an obligation to listen and help them effectively tell it.
Source: The New Yorker; Can Science Explain Why We Tell Stories -May 18, 2012
While there likely have been a significant number of safety-related recalls during May, we are not able to gain access to them. We are not including May recalls in the Report for that reason. The NHTSA website for some reason is not giving access to the recall information. You can contact Shanna Malone at Shanna.Malone@beasleyallen.com for more recall information or to supply us with information on recalls that you may have.
We are happy to welcome Demet Basar to Beasley Allen and to the firm’s Consumer Fraud & Commercial Litigation Section. Demet brings with her nearly 30 years of experience in complex class action litigation. Her practice is focused on representing consumers in class actions seeking redress for unfair and deceptive practices, including the marketing and sale of defective products.
Demet currently is sole lead counsel in In re: Rock ‘n Play Sleeper Marketing, Sales Practices, and Products Liability Litigation, representing 4.7 million parents and caregivers in a multidistrict litigation against Fisher-Price and its parent, Mattel, arising from the marketing and sale of Fisher-Price’s popular inclined Rock ‘n Play Sleeper, the use of which has resulted in many infant deaths and injuries. Demet is also working with Dee Miles, Clay Barnett and Mitch Williams in several automotive class actions involving dangerously defective fuel pumps, including Oliver v. Honda Motor Corp. Ltd. et al., Case No. 5:20-cv-00666-MHH (N.D. Ala.).
Demet says her belief in social justice prompted her legal career, explaining:
I started my legal career as a paralegal at The Legal Aid Society in New York, advocating on behalf of indigent people at administrative hearings to help them get Social Security and other public benefits. My elders there encouraged me to go to law school and I did.
Having earned her undergraduate degree from Fairleigh Dickson University, where she was a member of the Phi Omega Epsilon honor society and graduated summa cum laude, Demet attended Rutgers University School of Law. She earned her juris doctorate in 1990. While in law school, she was Senior Notes and Comments Editor for the Rutgers Law Review and a recipient of West’s Scholarship Award for an article she wrote about the responsibility of nuclear scientists under international law. Demet said she focused more on global issues during this time, including working with the Lawyers’ Committee on Nuclear Policy.
After law school, Demet initially worked at a big Defense firm, but realized she had always been a Plaintiff’s lawyer at heart. She says:
Protecting the public from dangerous products/acts and holding corporations accountable for their misconduct is an important service to society.
Before joining Beasley Allen, and while she was at her previous firm, Demet served as co-class counsel alongside Dee Miles in Simerlein et al. v. Toyota Motor Corporation et al, Case No. 3:17-CV-01021-VAB (D. Conn.). The class action resulted in a nationwide settlement providing quality class-wide relief valued at up to $40 million for the benefit of 1.3 million owners of Toyota Sienna minivans with sliding doors, including a 10-year warranty for covered parts, a free inspection, and reimbursement for covered repairs. She has also served as lead or co-counsel in other consumer protection cases, including against e-cigarette manufacturers.
Previously, Demet represented individual and institutional investors, including public and labor pension funds, in complex securities fraud class actions and derivative litigations in federal and state courts.
As co-chair of her previous firm’s Madoff Recovery Litigation Task Force, Demet successfully represented hundreds of investors in securities class actions against various “feeder funds” that entrusted client funds to the now infamous Ponzi scheme operated by Bernard L. Madoff. The class actions recovered more than $300 million for wronged investors, including a $100 plus million settlement in In re Tremont Securities Law, State Law and Insurance Litigation and a $219 million plus settlement in In re Beacon Associates Litigation.
Demet’s favorite part of practicing law, she said, is writing:
In my view, presenting a persuasive argument on paper is one of the most important tools lawyers have in advocating for their clients because it allows us to communicate with judges directly, uninterrupted and without distractions. In order to do that effectively, we have to fully understand the nooks and crannies of our cases – and, of course, thoroughly study the relevant law – and try to determine the areas in which the court is likely to view our case as strong or weak or neutral. Equally importantly, when writing for the judge, we also have to try to identify any facts and arguments we think the court may not fully understand and, if there are any, find the best way to inform the judge respectfully. Finally, we have to write simply, in plain English, and without assuming the reader – who is usually the judge’s clerk, a young lawyer – knows anything about our case. Doing all this is quite challenging – at least for me – and usually involves many drafts (sometimes to the consternation of my colleagues) in which I’m reordering and recasting arguments, rewriting the preliminary statement and fine-tuning the overall theme of the brief. But it’s something I thoroughly enjoy.
Demet is a member of the New York City Bar Association. She is also committed to giving back to her community. Demet has been involved in fundraising efforts in her community, including for the Urban Upbound, which provides resources to public housing residents to foster economic mobility and self-reliance.
In reflecting on joining Beasley Allen, Demet said she has been impressed that the firm “has so many practice groups under one roof all of which are devoted to vindicating the rights of victims of different kinds of harm.” She has also been impressed with each of the groups’ continued success, including the firm’s most recent success. Demet said:
Just in the short time I have been here, there have been two major firm victories – both reported in national press – first, resisting defendants’ motions to exclude expert testimony in the firm’s talc mass tort cases, which led to Johnson & Johnson taking its Baby Powder off the market in North America, and, second, getting three bellwether state classes in the GM engine defect case certified, which will likely lead to the certification of an additional 25 state classes, and may make it possible to achieve a settlement. Think of how many individuals have already benefited and stand to benefit from these developments – including, most importantly, women who will no longer face the prospect of ovarian cancer from using J&J talc-based products.
Demet says she also appreciates the true teamwork and inclusiveness at Beasley Allen, adding:
It’s as though everyone at the firm is part of one big family. The first time I saw the email distribution list called ‘Everyone in the firm’ instead of the corporate sounding ‘All Personnel,’ I knew I wasn’t at a New York firm anymore.
Demet Basar will be a tremendous addition to our firm. We are honored that she saw fit to join us.
Kelli Jo Flanagan
Kelli Jo Flanagan, who has been with Beasley Allen for 20 years, works in the Toxic Torts Section. She is the Legal Secretary to Rhon Jones and Tucker Osborne. Kelli is responsible for handling the calendar, correspondence, dictation transcription, pleadings, arranging travel, organizing files, document review, communicating with clients and lawyers, updating client files and helping others in the section.
Kelli says she is a “very proud Momma” to three beautiful daughters, Alissa (20) and twins, Emilee and Bailey (18). She says all three young ladies are very busy and keep her on her toes. The twins are Juniors this school year and have been active in their Junior Civitan Club. Bailee is also the Junior Class Vice President.
Kelli says that she loves to spend time with her friends and family, especially cooking out, going to the beach, working out and just relaxing. When asked what her favorite thing is about working at Beasley Allen, Kelli says, “how much the Firm gives back to the community and gives the employee an opportunity to participate in these various events, especially adopting and providing families with meals and gifts during the holidays.
Apreill Daun Hartsfield
April has been with the Firm for three years and is a Writer in our Marketing Section. She writes content for the firm’s website and maintains lawyer biographical information on the site. Apreill also drafts content for the Jere Beasley Report and assists with articles that are submitted to publications outside of the firm. Additionally, Apreill manages the firm’s social media presence, including content and scheduling posts for all of its social media channels.
Apreill is married to Rodney and they have a 7-year-old daughter and a 6-year-old son. They are members of Journey Church of the River Region where Rodney and Apreill teach 3-year-olds and serve in Journey Kids ministry. Apreill is also a vocalist for the Journey Worship Team.
In her spare time, Apreill loves spending time with her family and watching her kids enjoy their favorite sport, which currently is karate. She loves singing, is an avid reader and devours podcasts about writing, Bible studies and mysteries. When asked what her favorite thing is about working at Beasley Allen, Apreill says:
I love the firm’s commitment to helping those in need. That it pursues each client’s case for the right reasons while maintaining a level of integrity and professionalism, I believe, are enviable among other firms of its caliber.
Apreill is a dedicated, hard-working employee. She is a definite asset to the firm. Apreill has an extremely important role at Beasley Allen. She helps us get our story of helping those who need help out to the public. We are blessed to have her at Beasley Allen.
Lauren Elizabeth Miles
Lauren Miles first joined Beasley Allen in 2014 as a law clerk in the Consumer Fraud & Commercial Litigaiton Section. She returned to the firm as an associate in the Section in 2018. Lauren is working on class action litigation involving consumer fraud in the health care industry, qui tam litigation under the False Claims Act, as well as sexual harassment and employment discrimination. Before returning to the firm, Lauren practiced law in Birmingham, Alabama, focusing on contract, fraud, and employment law.
After returning to the firm, Lauren was part of the team that worked with the Kentucky Attorney General’s office, helping secure a $10.3 million settlement in its case against Fresenius Medical Care Holdings Inc., a Massachusetts-based dialysis company, for Medicaid fraud.
Lauren explained that while growing up, her family prioritized an obligation to “your neighbor,” or the notion that “if you can help someone else, share their burden, then you should.” She said she internalized this message. Additionally, she said she was “exceptionally blessed to have had the opportunity to grow up surrounded and influenced by Beasley Allen attorneys.” The combination of these influences on her life led her to follow in her father’s footsteps and become an attorney.
“I was always interested in pursuing a career that personified my parents’ priority and witnessing the successes Beasley Allen attorneys accomplished in helping those who need it most inspired me to follow them into the profession,” Lauren said.
Lauren completed undergraduate school at Birmingham-Southern College (BSC) in 2012, with a B.A. in Political Science. While at BSC, Lauren was on the dean’s list and selected to multiple national academic honor organizations. She was also active in student government and in Greek communities, as well as student organizations including the EnACT Club and student art league. She also interned in the U.S. Senate for Senators Richard Shelby and Lindsey Graham.
Lauren continued her education at Samford University Cumberland School of Law, where she earned her law degree in 2015. While in law school, Lauren was a dean’s list student, a member of the Cumberland Women in Law organization and the Cumberland Environmental Law Society. She also participated in Cumberland’s various community outreach programs and clerked for other Plaintiff’s law firms, in addition to Beasley Allen, as a law student.
Lauren says her favorite part of practicing law is when she can successfully represent a client. She says:
It’s an unfortunate reality that a client comes to us in need of our service because someone has exploited or harassed or devalued them. The moments I can help a client confront their oppressor and compel that bad actor to recognize my client’s value are so precious to me. There are so many bad actors committing injustices through greed or indifference every day: effectively representing my client in challenging that turpitude by demanding a person’s worth is respected encourages me when I’d otherwise be disheartened.
Lauren supports Kings Home and the Wellhouse Birmingham. She is also a member of the Board of Directors for Catholic Social Services and is an active BSC alumna and advisor to her sorority chapter. As a native of Montgomery, Lauren splits her time between her hometown and her adopted city of Homewood, Alabama. She is a member of the Cathedral Church of the Advent in Birmingham where she and her husband were married last year.
Lauren says she is proud to have returned to Beasley Allen and to be part of a firm that is committed to improving the community through service and outreach initiatives, committed to improving the lives of its clients, and even committed to improving how its attorneys approach their work – by adapting to evolving legal standards and challenges while preserving the integrity of their work and supporting one another.
“There are other great firms, filled with exceptionally talented lawyers (several of which I had the privilege to also work for before Beasley Allen), but I personally believe our firm’s progressiveness is uniquely exceptional,” Lauren said.
We are blessed to have Lauren at Beasley Allen. She is totally dedicated to the stated mission of the firm and works hard to see that her clients receive justice.
Brandi Wilkerson Ross
Brandi Ross is a Clerical Assistant in the Personal Injury & Products Liability Section. She assists the Section Director with day-to-day operations of incoming personal injury cases. She also works on various assigned projects to help with the completion of specific tasks and that is very important, especially with those approaching deadlines.
Brandi is married to David and they have been married for 11 years. They have two children, Michael, 10 and RaeLeigh, 6. They attend and serve at Church of the Highlands. They also have three “furry friends” that complete their family.
Brandi’s family enjoys exploring nature and finding new trails they have never hiked before. Occasionally they enjoy camping. One of their new favorite state parks is Tannehill Ironworks. When things are quiet, Brandi says she enjoys reading.
When asked what her favorite thing is about working at Beasley Allen, Brandi says:
I am honored to work for a company which places high value on the things that matter in life. I love the encouraging atmosphere which welcomes my faith in Jesus Christ. I am blessed to work for individuals who consider family a top priority. No matter the daily task at hand, I find fulfillment in working for a firm with morals; a firm helping those who need it most.
Brandi is another dedicated, hard-working Beasley Allen employee who is an asset to the firm. We are blessed to have her with us.