On May 23, 2012, investors filed a federal class action against Facebook, saying the company shared crucial information with preferred investors before the company’s already contentious Initial Public Offering.
The class claims that Facebook, Mark Zuckerberg and the banks that underwrote the company’s IPO downgraded earnings expectations before the offering, but shared the bad news only with “certain preferred investors,” and omitted it from the registration statement and prospectus. Read more…
On May 25, 2012, Judge King in the Southern District of Florida preliminarily approved the $100 million settlement between JPMorgan Chase and its customers who were allegedly charged excessive overdraft fees when JPMorgan Chase switched its method for ordering transactions based on highest to lowest.
A Final Approval Hearing has yet to be scheduled.
By most accounts, BP Plc appears to be well on its way to concluding an estimated $7.8 billion settlement to resolve most of its civil liability from the Gulf of Mexico oil spill. But a potential landmine lurks in the settlement. Under certain circumstances, the company can invoke a little-noticed provision that allows it to walk away from the deal.
The trigger is opt-outs. In a settlement of a class action, class members can reject the deal and decide to go it alone. Defendants have to be prepared for the possibility that a high volume of opt-out litigation will undermine the goal of global resolution. BP certainly is prepared: Its settlement agreement with plaintiffs claiming economic and property damages includes a provision that gives BP the right to terminate the deal if the total of opt-outs “exceeds a number agreed to by the parties.” Read more…
A Chinese company has agreed to pay $10.5 million to U.S. purchasers of vitamin C who accused it of conspiring to raise prices by limiting exports, a proposed settlement showed. The proposed settlement, filed in U.S. District Court in Brooklyn on Monday, is the first in a long-running legal battle brought by commercial buyers of vitamin C against four Chinese companies.
If it is approved by the judge overseeing the case, it would be the first civil settlement reached with a Chinese company under U.S. antitrust cartel law, lawyers for the purchasers said. “As such, the settlement is an important step in private enforcement of U.S. antitrust laws,” a court document said. Read more…
Regulators moved on May 10, 2012, to seize control of pension plans at Dewey & LeBoeuf, the latest sign of likely collapse at what was once a top U.S. law firm. Dewey also faced its first lawsuit over plans to fire hundreds of employees.
The Pension Benefit Guaranty Corporation said it would take responsibility for three pension plans covering 1,800 current and future retirees. The plans were underfunded by $80 million, it said. Read more…
Geek Squad workers have filed a class action law suit against parent company Best Buy, alleging they were forced to work off the clock and without rest periods.
Lawsuits accusing employers of not paying their workers properly have exploded in the last few years, as recession lay offs required employers to lean more heavily on fewer workers. Reports suggest that in 2011, companies in the S&P 500 made $420,000 in revenue per employee even as worker output grew and real wages fell. During the same year, workers filed 7,006 lawsuits relating to wage and hour violations in federal courts, according to similar reports. That’s a 32% increase from 2008 and a 378% increase from 2000. Read more…
