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Case Summaries

Class Actions

[08/25] Fireside Bank Cases
In coordinated class actions challenging a lender's collection practices, trial court's entry of dismissals with prejudice against all class members against whom the lender had previously secured judgments in separate collection actions is affirmed where: 1) plaintiffs' contention that the trial court was empowered by the UCL to grant class-wide relief to judgment debtors without a factual showing of grounds to avoid the judgments against them is rejected, and, since no other basis for relief on their behalf was ever suggested, the court did not err by concluding that the UCL afforded no basis for the class-wide affirmative relief sought in this class action; and 2) the appeal is dismissed as moot insofar as it is taken from orders denying leave to intervene and refusing to certify a subclass consisting of judgment debtors.

[08/24] Holster v. Gatco, Inc.
In a class action under the Telephone Consumer Protection Act (TCPA), dismissal of the action for lack of subject matter jurisdiction is affirmed where: 1) to the extent that the Second Circuit's prior holding was based on treating the TCPA "as if it were a state law," Shady Grove's holding that Rule 23 generally preempts C.P.L.R. 901(b) abrogated the court's holding; and 2) the TCPA constituted a delegation by Congress to the states of considerable power to determine which causes of action lie under the TCPA.

[08/23] Gutierrez v. California Commerce Club, Inc.
In plaintiffs' putative class action lawsuit against California Commerce Club, Inc. (Club), claiming that they and other similarly situated members of the class were injured by defendant's unlawful policy and practice of denying meal and rest breaks to certain hourly, non-union employees, trial court's order sustaining defendant's demurrer without leave to amend is reversed as it was premature for the trial court to make determinations pertaining to class suitability on demurrer as plaintiffs' allegations of the operative complaint were sufficient to move the action beyond the pleading stage.

[08/20] Schleicher v. Wendt
In a securities-fraud suit against some managers of a large, publicly traded financial-services holding company, district court's conclusion that investors can use the fraud-on-the-market doctrine as a replacement for person-specific proof of reliance and causation in granting the class certification is affirmed as, the district court assured itself that the market for the company's stock was thick enough to transmit defendants' statements to investors by way of the price, and as such, the district court did not commit a legal error, or abuse of discretion, in deciding that the fraud-on-the-market doctrine should not be conscripted to serve some other function.

[08/18] Carvalho v. Equifax Info. Servs., LLC
In an action against credit reporting agencies alleging violations of the California Consumer Credit Reporting Agencies Act (CCRAA), summary judgment for defendants is affirmed where: 1) because the face of plaintiff's superior court complaint lacked any indication of the amount in controversy, it did not trigger the first thirty-day removal period; 2) because section 1785.25(a) was the only substantive CCRAA furnisher provision specifically saved by the Fair Credit Reporting Act, plaintiff's section 1785.25(f) claim was preempted; and 3) unless plaintiff raised a genuine issue as to whether the disputed item was inaccurate, her CCRAA section 1785.16 claims failed as a matter of law.

[08/18] In re: Mercury Interactive Corp. Sec. Litig.
In a securities class action, the district court's order awarding attorneys' fees of twenty-five percent of the $117.5 million settlement fund to class counsel is vacated where the district court erred under Federal Rule of Civil Procedure 23(h) in setting the schedule for objecting to counsel's fee request.

[08/17] Wolin v. Jaguar Land Rover N. Am. LLC
In a class action alleging that Land Rover's LR3 vehicles suffer from an alignment geometry defect that caused tires to wear prematurely, the denial of plaintiff's motion for class certification is reversed where: 1) the district court erred when it required plaintiffs to show that a majority of proposed class members’ vehicles manifested the results of the defect; 2) defendant identified no defenses unique to plaintiffs that would make class certification inappropriate; and 3) classwide adjudication of plaintiffs' claims was superior to other means of adjudicating this case.

[08/16] Malack v. BDO Seidman, LLP
In plaintiff's putative securities fraud class action against an accounting firm that assisted American Business Financial Services, Inc. (American Business), a subprime mortgage originator based on section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5, claiming that defendant defrauded plaintiff and other investors by providing American Business clean audit opinions that were used to register the notes at issue with the Securities and Exchange Commission (SEC), district court's denial of class certification is affirmed as the fraud-created-the-market theory lacks a basis in common sense, probability, or any of the other reasons commonly provided for the creation of a presumption, and as such, the court declines to recognize a presumption of reliance based on the theory.

[08/16] Walnut Producers of California v. Diamond Foods, Inc.
In plaintiff-walnut producers' class action suit against Diamond Foods, claiming that defendant breached an agreement by failing to pay them the reasonable market value for their walnuts, trial court's order striking all class action allegations from the complaint is affirmed where: 1) plaintiffs have not pleaded sufficient facts showing the class action waiver's unconscionability to survive defendant's motion to strike the class action allegations in the complaint; and 2) the class action waiver is not void as against public policy and the enforcement of public rights as it does not affect an unwaivable statutory right.

[08/16] In Re: Ins. Brokerage Antitrust Litig.
In multiple putative class actions against insurers and insurance brokers, claiming massive conspiracies throughout the insurance industry related to commercial and employee benefit insurance, district court's dismissal of the actions under Federal Rule of Civil Procedure 12(b)(6) is affirmed in part, vacated in part and remanded where: 1) district court's dismissal of the Sherman Act claims with respect to defendants alleged to have engaged in bid rigging in the Marsh-centered commercial conspiracy is vacated; 2) dismissal of the RICO claims based on the alleged Marsh-centered commercial enterprise, with respect to those same defendants is vacated; 3) dismissal of RICO claims based on the alleged CIAB enterprise, with respect to the defendant brokers, is vacated; 4) dismissal of state-law claims is vacated; and 5) district court's judgment in all other remaining respects is affirmed.

[08/13] Fisher v. DCH Temecula Imports LLC
In plaintiff's suit for injunctive relief, restitution, rescission, and damages both on her own behalf and as a class action lawsuit against an automobile dealer, claiming several causes of action including violation of the California Legal Remedies Act (CLRA), trial court's denial of defendant's petition to compel arbitration is affirmed as the CLRA is not preempted by the FAA, and the arbitration clause at issue here required plaintiff to waive an unwaivable statutory right under the CLRA to bring a classwide arbitration or class action lawsuit, which violates the public policy, underlying these rights.

[08/12] Avritt v. ReliaStar Life Ins. Co.
In plaintiffs' appeal from the district court’s order denying class certification for a group of California residents who purchased fixed deferred retirement annuities from Northern Life Insurance Company, the order is affirmed where the district court properly determined that class certification was not appropriate because the plaintiffs' claims involved a number of individual issues that could not be resolved on a class-wide basis, including whether defendant misled the plaintiffs about its interest-crediting practices and whether the plaintiffs relied upon any such misrepresentations.

[08/12] Schwartz v. Poizner
In plaintiff's petition for a writ of mandate seeking to compel the Commissioner of the California Department of Insurance to pursue additional remedies against the insurers that will inure to the benefit of class members, in his suit against the insurers on behalf of himself and California residents holding disability income policies issued by the insurers who, like him, submitted no claims under their policies but allegedly were overcharged for their policies in view of the insurers' unlawfully restrictive claims procedures and who received no benefit under the terms of the settlement agreement, trial court's grant of Commissioner's motion to dismiss is affirmed where: 1) even on the questionable assumption that plaintiff and purported class members suffered economic harm as a result of the insurers' claim practices that have not been corrected, the Commissioner was not required to pursue any remedy on their behalf; and 2) nothing in the record suggests that the decision not to pursue additional remedies was so unreasonable as to constitute an abuse of discretion.

[08/11] In re: Aetna, Inc. Sec. Litig.
In plaintiff shareholders' securities fraud class action suit against Aetna, Inc., claiming that defendants misled investors about Aetna's pricing of insurance policies and then sold shares of Aetna's stock before the fraudulent scheme was revealed to the public, district court's order dismissing the suit under the Private Securities Litigation Reform Act (PSLRA), 15 U.S.C. section 78u-5(c)(1), which contains a safe harbor for forward-looking statements, is affirmed as the PSLRA safe harbor for forward-looking statements immunizes defendants from liability for securities fraud as the allegedly misleading statements were forward looking, identified as such, accompanied by adequate cautionary statements, and immaterial as a matter of law.

[08/10] Shlahtichman v. 1-800 Contacts, Inc.
In plaintiff's class action suit against 1-800 Contacts, claiming that defendant violated the Fair Credit Reporting Act of 1970 (FCRA) as amended by the Fair and Accurate Credit Transactions Act of 2003 (FACTA) by including the expiration date of a purchaser's credit card in the order confirmations it sent by email, district court's grant of defendant's motion to dismiss for failure to state a claim on which relief could be granted is affirmed where: 1) both the language and context of the truncated requirement make plain that Congress was regulating only those receipts physically printed by the vendor at the point of the sale or transaction, and to apply the statute to receipts that are emailed to the consumer would broaden the statute's reach beyond the words that Congress actually used; and 2) even if the court construed the statute too narrowly, dismissal of plaintiff's complaint was nevertheless appropriate because 1-800 Contacts did not willfully violate the statute.

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