Lawsuits & Judgments

For those of you without Children in the house, let me introduce you Hannah Montana. She is a fictional pop star and the title character of a Disney Channel original sitcom of the same name. If you do have children in the house than you know that Hannah Montana is also an incredibly popular show, character and a talented singer.

The show follows the life of a teen age pop star named, Hannah Montana. Much of the humor in the show is derived from the secret life that Hannah leads. By day Ms. Montana is a normal teen who goes by her given name of Miley Stewart. She attends the local high school and shops at the mall with her friends. However with sunglasses a wig and a shiny wardrobe she transforms into Hannah Montana teen pop sensation. ( trust me, it is more convincing than the old superman transformations). Ms. Montana is played by Miley Cyrus, the 14 year old daughter of actor and country star Billy Ray Cyrus. Mr. Cyrus also plays Ms. Montana’s father on the show.

On Oct. 18th, the teen embarked on the “Best of Both Worlds” concert tour in support of her album “Hannah Montana 2 - Meet Miley Cyrus.” The concert tour, which also features The Jonas Brothers, has been incredibly popular and sold out immediately with some tickets being been resold on line for thousands of dollars.

The class action lawsuit was filed by Attorney Rob Pierce against the Miley Cyrus Fan Club, a for profit entity run by Interactive Media Marketing Inc. The fan club claimed that members would have priority in buying tickets for the concerts on its website. Many fans joined the club, paying the $29.95 membership fee, for this reason alone but were still unable to get tickets as the shows sold out almost immediately.

As a result, the class action lawsuit was filed in the US District Court in Nashville by Mr. Rob Pierce. The suit is seeking triple damages, as is allowed under the Tennessee Consumer Protection Act, for all club member who joined in hopes of getting tickets. According to Pierce:

Thousands of people joined the club based on the understanding that by joining they would be able to purchase Hannah Montana concert tickets before they were offered for sale to the general public.

 

While the club and the website do not guarantee ticket availability, they explicitly state that members who log on shortly after tickets become available will have a good opportunity to get tickets. In reality, the vast majority of club members, including those who logged on at the appointed time or shortly thereafter, were unable to obtain concert tickets.

 

In its defense, the fan club has re-stated that they never guaranteed tickets and that almost 70,000 members were able to obtain tickets through the site.

More information can be found on the Mr. Pierce’s website

We are interested to see how this one turns out but more for the celebrity angle than any specific point of case law. However we strongly feel that when a business interacts with children or teens that the burden is on the business to act honorably and not rely on fine print or legal gray areas to get by. The young consumers they are targeting simply don’t have the experience to look for or decipher such offers.

On Sept 23rd, this website reported that a lawsuit brought by three Nevada breast cancer survivors against New Jersey pharmaceutical company,Wyeth.

It took the jury only 12 hours to return a $ 134.5 million judgment against the drug company. Each of the three claimants was awarded $7.5 million in past damages. The jury also awarded two of the women $36 million and the third $40 million for future damages.

At the heart of the case is the side effects of Wyeth’s hormone replacement drugs, Prempro and Prempro . The drugs, which are normally prescribed to treat the effects of menopause, can cause thickening of the breast which can promote to breast cancer.

This is the largest verdict yet against Wyeth who has not yet seen a judgment higher than $5 million. The company is currently facing more than 5,000 similar suits. In various articles, Wyeth spokesmen have been quoted as saying that the drugs are safe and pointed out that they are still on the market and retain their FDA approval further noting that the drugs are packaged with warning about the possible link to breast cancer.

We had predicted that this one would go to the plaintiffs based mostly on the fact that their law firm, Littlepage Booth, had already won a judgment against Wyeth in a similar case. Now that they are 2-0, we would think that the defendant is probably a little concerned.

The record industry front group has won its first lawsuit against a person accused of sharing music on line. We were openly skeptical about the record industry’s chances once they actually had a case go before a jury but it seems that we were mistaken. Today the RIAA (Recording Industry Association of America) won a $220,000 Judgment against a Minnesota woman, Jamie Thomas, for downloading or sharing 24 songs from the Kaza file shearing service. The judgment was based on a $9,250 fine for each of the 24 songs. Many, including Ms. Thomas, are calling the fine excessive, but the considering that the defendant could have been fined as much as $150,000 per violation, and the original suit specified that 1,700 songs were downloaded from Kaza , one could argue that she got off lightly.

Ms Thomas claims that she didn’t download the songs and that her IP address may have been spoofed or her computer hacked, but didn’t have the resources to prove either allegation. In the end, the jury didn’t buy it or at least felt that it didn’t matter. In a way, they were saying that you are responsible for what goes on at your computer whether you did it or not.

This seems to be exactly the type of precedent setting judgment that the RIAA was hoping for. In the more than 26,000 lawsuits that they have filed against down-loaders, this is the first one that has gone before a jury. Up until know, their strategy had been to force settlements of a few thousand dollars and a agreement not to engage in any more file sharing. They have dropped suits that didn’t look good and recently a couple of rulings, one a pre-trial motion in this case, seemed to put music industries tactics in doubt.

The defendant has not decided what her next steps in this case will be but the Electronic Privacy Information Center (EPIC) has reported receiving offers from attorneys who have offered to represent her in an appeal.

Lawsuits & Judgments firmly believes in the right to defend ones own copyright. However, we don’t appreciate the RIAA’s tactics in these cases and we are not sure that we agree with the ruling in this case. We think that the claimants need to prove some actual wrongdoing by a specific person, not just prove it was possible, before such a large penalty is awarded. As a result of this judgment, we expect that more people facing RIAA suits will take the settlement. No doubt this is music to the record industries ears.

The Arkansas attorney general is preparing to file what could be a $600 million lawsuit against three pharmaceutical manufacturers. The case which will likely be filed in the Pulaski County Circuit Court within the month will name the Eli Lilly & Co., Janssen Pharmaceutica and Astra Zeneca. as defendants. At issue in the case is the companies “off label” marketing practices of the anti-psychotic drugs Zyprexa (Lilly), Risperdal (Jansen) and Seroque (Astra Zeneca).

Off Label marketing is a practice in which a drug is marketed to doctors as a treatment for condition which it was not approved by the FDA. Zyprexa, Risperdal and Seroque are anti-psychotics which are approved to treat conditions such as bipolar disorder and schizophrenia and would normally be prescribed by a Psychiatrist. In this case, the companies are alleged to have promoted the drug to primary care physicians for the treatment of dementia and anxiety, conditions much less severe than those that were “on label”.

Many of the patients who took the drugs for the lesser conditions suffered sever side effects and as a result, the state wants to recover its costs.

The state is suing to recover an estimated $200 million its Medicaid program spent on the drugs over the past eight years. Because Arkansas state law allows for triple damages the suit could reach $600 million. Attorney General McDaniel has given the case to the Houston based lawyers of Bailey Perrin Bailey LLP. (website). The firm is already handling several similar cases and the AG admits that this case large enough that his office could not handle it independently.

This should be an interesting case. While the big pharma guys appear to have pushed things pretty far in this case, off label prescriptions are a legal and accepted practice in medicine.

Wyeth is once again trying to defend itself in a civil case over its menopause treatments. A lawsuit was filed in the Washoe District Court In Reno Nevada byt the firm of Littlepage Booth on behalf of three Nevada women. Each of the women developed breast cancer after taking the Wyeth hormone replacement drugs of Prempro and Premarin. Opening arguments commenced last week.

The drugs were developed to treat the common menopause symptoms of hot flashes, night sweats and vaginal dryness. However, longterm use of estrogen supplements has been linked to increased breast density in women which greatly increases the chance of breast cancer. The plaintiffs claim that the company knew there were potential problems with the drugs for almost 30 years and took no action to alert consumers. An article on the Reno Gazette Journal website quotes Zoe Littlepage, an attorney for the plaintiffs as saying:

The evidence will show that from 1975 on, there were a number of red flags when Wyeth was put on notice that there were some real questions that needed to be answered…Wyeth made no effort to answer those questions, to find out what these drugs were doing in the breast

The New Jersey based pharmaceutical; company counters that there is no link between the claimants breast cancer and their products and further states that the three women, along with all of the patients who used Prempro and Premarin the enjoyed relief of their symptoms as well as the added protection that hormone replacement therapies offer against osteoporosis.

It will be interesting to see how this turns out, but we are leaning towards the plaintiffs on this one. The last time that Wyeth and Littlepage Booth met in court over these products, the plaintiffs walked out with a $1.5 million dollar judgment. We don’t see any reason why the rematch would end differently

In an apparent first, a city and state have filed a joint Medicaid class action lawsuit. In this instance, New York Attorney General Andrew Cuomo and New York City Mayor Michael Bloomberg, have announced that they are filed a joint class action against Merck to recover the money that the state and city agencies pad for VIOXX prescriptions. According to a press release on the Attorney General’s website, the state paid more than $100 million for VIOXX prescriptions through the state sponsored insurance funds of EPIC and Medicaid.

The suit alleges that Merck withheld information on known the drugs dangers from the prescribing physicians and if the physicians had had this information, they would not have prescribed the now recalled pain reliever.
(We suppose that the physicians would have prescribed something else and not actually saved the state any money, but that is an argument we will leave for the defense.)

The overall nature of the suit is summed up in this quote from Attorney General Cuaomo:

Today’s suit demonstrates an important new State and City partnership to fight Medicaid fraud, and I am happy to work with Mayor Bloomberg to help hold Merck accountable. Merck’s irresponsible and duplicitous conduct endangered the health of New Yorkers and wasted our tax dollars. As alleged in the complaint, even as evidence was piling up showing just how dangerous this drug was, Merck put profits above all else and put thousands at risk by continuing to push Vioxx inappropriately on doctors and patients… We will hold accountable those who put our families at risk, and we will fight back when New Yorkers are harmed and fleeced.

There are reportedly more than 27,000 VIOXX cases against Merck already and the pharmaceutical giant has bee fairly successful in getting class action thrown out, but these are two powerful entities represented by two aggressive and media savvy figures in Bloomberg and Cuomo. We would not be surprised to see a settlement in this case, but we just can’t bring ourselves to bet against Merck in these big VIOXX cases.

Nebraska State Senator Ernie Chambers of Omaha, has filed a lawsuit against God in the Douglas County District Court. And if you think this is a simple play on words, its not. The State Senator is actually trying to sue God, yes, the God The Almighty, He is Who is, The Creator…

State Senator Chambers claims to be filing the suit to demonstrate that there are no controls in the American legal system and that anyone can sue virtually anyone else for any reason. Now the logistics of suing a deity have yet to be clarified. For example, who one would serve papers or enforce a judgment against God is still to be determined. However that has not stopped this suit from being filed.

An article on the KPTM, Fox 42 website states that Sen Chambers is seeking a permanent injunction against god for making terroristic threats and for causing “fearsome floods, horrendous hurricanes and terrifying tornadoes” . We assume the threats made are the ever present possibility of more disasters. Sen Chambers is seeking a default judgment, apparently assuming that God will not offer a defense of any kind.

However the whole situation could raise some interesting legal questions. Assuming the Senator is not subject to plagues or other forms of Old Testament-ish divine retribution, we would expect the court to dismiss the case. However two of the courts options are to award the default judgment or allow the case to proceed. The question is would either of these (judgment or trial) set a legal precedent for the existence of God. Would the burden of proof shift from the faithful to prove there is a God to the Faithless who would then have to prove there isn’t, at least in Nebraska. And if this is the result, can Sen Chambers be elected without the Atheist vote?

Of course the more realistic legal question is what is the Senator trying to accomplish. We can assume that he would like to place controls on the nature and types of lawsuits that can be filed. We all know there a frivolousness and even false suits filed that should never be heard but is the greater good served by limiting the peoples access to the courts.

On September 14^th the Minnesota law firm of Charles H Johnson and Associates announced a the filing of a class action lawsuit against the soda pop maker Jones Soda Company. As you would expect, the suit alleges that false or misleading statements from the company artificially increased the company’s stock price and the share holders are, of course, alleged to have suffered as a result.

The suit comes after the release of Jones Soda’s 4^th quarter results which were lower then expected. Earlier in the year Jones had stated that they were in the process of obtaining distribution agreements with national retails such as Wal-Mart, Safeway and K Mart for the companies new line of 12 oz canned sodas. Further, the company the announced that it was on track to capture 25% f the canned soda market, worth more than $60 billion, by the end of the year.

According to the story on CNN.com, the announcement caused the Jones stock price to jump by $3, or 21 % in a single day. On August 2nd, the company released its fourth quarter results which included the sales figures for the canned soda lines and the company had to admit it was having trouble getting the retail space agreements it had alluded to earlier. The share price dropped 23% to $11.70 per share on the news.

If you bought Jones Soda Company stock (ticker symbol JSDA) between November 1, 2006 and August 2nd, 2007 you may be an eligible member of this class and should contact Charles H. Johnson & Associates at cjohnsonlaw@gmail.com

The United Food and Commercial Workers International Union has filed a class action lawsuit against the Department of Homeland Security’s Immigration and Customs Enforcement (ICE) Division in Amarillo Texas. The complaint stems form a series of “workplace enforcement raids” the unit conducted at six Swift and Company meat packing plants in Texas on December 12, 2006.

The suit was filed on behalf of eight employees at the plaint, all of whom were either US citizens ore legal aliens. The suit claims that they were detained illegally during the raids, in violation of their fourth amendment rights. The union alleges that more than 12,000 employees were detained for up to 12 hours, against their will, during the action.

The Immigration agency points out that the raids were result of a year long identity fraud investigation and that there were search warrants issued that gave the agents the right to search the plants and question anyone there. Further, more than 1,200 were arrested during the raids. 649 had been deported as a result of illegal immigration and another 274 were charged with non-immigration felonies and almost all of those have been convicted.

We can appreciate the union’s desire to stand up for its members, but this redada (raid in Spanish) does not seem to have been done on a whim. Any raid that requires a year long investigation and generates almost 900 convictions or deportations would seem to be justified.

Last week we reported that the RIAA (Recording Industry Association of America) was itself the victim of a lawsuit. With another setback this week, it would seem that the legal problems are beginning to mount for the industry group known for its generic lawsuits against alleged music downloaders. Yesterday, according to an article on the Ars Technica website, District Court Judge Rudi Brewster of the US District Court for Southern California refused to grant relief to the RIAA because they did not provide enough evidence of wrongdoing.

The RIAA is known for its generic or boilerplate lawsuits, they have even gone so far as to file “John Doe” suits when they have not been able to identify a defendant in hopes of forcing colleges or ISPs to divulge actual names. This one must have seen like a slam dunk for the industry group as the defendant Yolana Rodriguez didn’t respond to her suit at all. The court clerk filed a routine claim for summary relief (automatic ruling for the plaintiff) for $4,170. However, Judge Rudi rejected the claim for relief based on the fact that the RIAA did not provide sufficient evidence.

In his ruling the judge stated:

However, other than the bare conclusory statement that on “information and belief” Defendant has downloaded, distributed and/or made available for distribution to the public copyrighted works, Plaintiffs have presented no facts that would indicate that this allegation is anything more than speculation. The complaint is simply a boilerplate listing of the elements of copyright infringement without any facts pertaining specifically to the instant Defendant.

In the ruling, Judge Rudi cited a recent Supreme Court decision on a telephone price fixing case, Bell Atlantic v. Twombly. While we would not normally expect a decision in anti trust case to be relevant in a copyright case, that suit was also dismissed based on the lack of evidence of specific wrong doing.

This could be a significant set back for the RIAA. If they have to abandon their boilerplate approach to their lawsuits we have to wonder if they can continue at all. In isolation, this development seems bad enough but when taken in combination with other recent events, this could be the beginning of the end for this particular lawsuit factory. Consider this combination of events

1- As a result of this ruling, the RIAA has to more completely investigate and document each of the claims it makes against alleged downlaoders.

2- The class action suit against the RIAA, which we posted about on the Sept 1,  alleges that RIAA investigators are using flawed investigative tactics, and could force the organization to use stricter standards in gathering evidence.

This could be a crippling (but not probably not lethal) combination. We would normally expect an organization to fight adverse rulings, but since the RIAA tries to stay out of court, we wonder how hard they will be willing to fight back in these cases. They seem to prefer the FUD (Fear, Uncertainty, Doubt) effect the suits have on the defendants over actual case law and they have been known to dismiss suits (without prejudice) rather than lose in court. Even if this decision and the earlier lawsuit don’t force the RIAA to change their ways, we would expect anyone currently fighting a suit from the RIAA to cite both this ruling and Bell Atlantic v. Twombly to highlight the weakness in the RIAA efforts.

Correction- It seems wee were mistaken when we reported in a post on September 1st, that “very few” of the lawsuits filed by the RIAA ever come to trial. Apparently we gave the RIAA too much credit; another article yesterday on the Ars Technica website states that none of the suits have come before a jury yet.