FLINT, MI – Interim Co-lead Class Counsel in the Flint water crisis litigation announced that Federal Judge Judith Levy of the United States District Court for the Eastern District of Michigan entered an order granting Class Certification on liability claims in the ongoing litigation against private engineering firms Lockwood, Andrews & Newman (LAN) and Veolia, LLC; Veolia, Inc, and Veolia Water (VNA). It is alleged that each company failed to give appropriate professional advice, greatly adding to the widespread lead contamination of the water that flowed into Flint during the water crisis.
By granting “Issues Classes” certification, the parties and the Court will address how damages will be resolved should liability be found on a class wide basis.
LAN and VNA have not signed onto the landmark $641.2 million partial settlement that has received preliminary approval from the Court.
“We are very happy that Judge Levy has entered an order of certification of two Issues Classes and has allowed our case to move forward against the engineering companies, who we believe acted negligently and contributed to the horrific contamination of the Flint water supply, which lead to both property damage and human health issues to the entire Flint community,” said Ted Leopold, court-appointed co-lead counsel and Partner at Cohen Milstein Sellers & Toll. “As we have made clear, we will continue to vigorously pursue the full measure of justice against those who caused harm to the residents of Flint.”
WHAT TO KNOW:
- Recent issues highlight barriers for victims
- Systemic change needed to end harassment
New York Gov. Andrew Cuomo, slammed with state investigative findings that say he sexually harassed multiple women, became the latest powerful figure years after the launch of the #MeToo movement to give face to the persistent toxic culture that creates barriers for victims of hostile workplaces.
The allegations against Cuomo come as recent high-profile lawsuits point to entrenched harassment and discrimination, including in shareholder cases against L Brands Inc., the parent company of Victoria’s Secret, that settled in late July; a California agency’s complaint accusing Activision Blizzard Inc. of a “frat-boy” culture; and sexual assault litigation against an ex-Tinder executive that’s slated for oral argument this week at a federal appeals court.
Despite some advancements from #MeToo activism, legal and political obstacles remain for victims to come forward with harassment claims, and structural changes in the legal system and at companies still need to happen to eradicate these patterns, academics and attorneys said. This is particularly true for vulnerable workers in the restaurant, agriculture, and other industries dominated by low-income employees, they added.
Meanwhile, corporations are looking inward and investing in ways to adjust culture, as employees and shareholders increasingly demand better practices to eliminate harassment and discrimination.
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Shareholder Muscle
While it may be hard for an individual victim to come forward, shareholder lawsuits targeting workplace harassment increasingly have led to changes at companies. L Brands agreed to spend $90 million on changes to corporate practices, including eliminating non-disclosure agreements. This followed a $310 million settlement with Alphabet Inc.’s board of directors and another $90 million settlement with Wynn Resorts Ltd. Another similar case is ongoing against Pinterest Inc.
“As shareholders got more involved, companies chose to make sure they were in compliance with Title VII,” said Julie Goldsmith Reiser, a partner with Cohen Milstein Sellers & Toll PLLC, who has led many of the shareholder suits against companies. “From the date that #MeToo hit, it has turned instead into, ‘What is a toxic culture?’”
She said the #MeToo movement has taken longer to seep into the public sector, and many scandals there didn’t have an impact, including those involving former President Donald Trump.
“Many victims fear not being believed or the other side denying it, or saying that she shouldn’t have put herself in that position: Your dress was too short, you drank too much,” she said. “There are societal checks preventing people from comfortably coming forward.”
Home sellers pursuing antitrust claims over allegedly anti-competitive National Association of Realtors commissions rules urged an Illinois federal judge Thursday to stop a real estate brokerage’s attempt to “end-run” an earlier discovery order by subpoenaing its own franchises for documents they’ve requested.
In a joint status report, the home sellers told U.S. District Judge Andrea Wood that Keller Williams Realty Inc. refused to collect documents from its franchises that respond to their pending discovery requests in a proposed class action, opting to subpoena them despite a ruling last month saying brokerages defending their antitrust suit have enough control over their franchises’ documents to pursue them without the subpoenas. They urged the court to direct Keller Williams to produce their requested documents “promptly, and through its own control.”
Keller Williams pushed back in the submission, though, asserting the home sellers’ objections “amount to nothing more than inappropriate meddling” in its effort to satisfy its discovery obligations. The company told the court it made a good-faith determination that subpoenas will be necessary to reduce the risk of its franchises objecting to the collection and ensure timely compliance with the court’s order.
“Plaintiffs’ views as to how Keller Williams should meet its discovery obligations pursuant to the Court’s order, to the extent relevant at all, cannot trump Keller Williams’ views about how to address the practical complexities of meeting their discovery demands,” the brokerage told the court.
The sellers are seeking documents potentially supporting their claim that certain NAR rules illegally inhibit competition and keep them locked into paying brokers a single rate no matter what quality of service they receive. They’ve been pursuing franchise documents from the defendant brokerages for several months, and all but Keller Williams decided to forego using subpoenas after the court said in July that they weren’t necessary, according to the parties’ status report.
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Law firm co-leading the plaintiffs’ suit include Susman Godfrey LLP, Cohen Milstein Sellers & Toll PLLC and Hagens Berman Sobol Shapiro LLP.
Valeant Pharmaceuticals agreed Thursday to pay $23 million to end a proposed class action accusing the drug company of violating the Racketeer Influenced and Corrupt Organizations Act with an alleged scheme to block its drugs from generic competition through a “secret network of captive pharmacies.”
A putative class of third-party payors asked a New Jersey federal judge Thursday to preliminarily approve an all-cash settlement reached with Valeant, the now-defunct mail-order pharmacy Philidor Rx Services LLC and Philidor’s ex-CEO Andrew Davenport, ending claims of fraud and conspiracy in violation of the RICO Act.
The proposed settlement comes after more than five years of litigation, which includes a yearlong stay during which a Valeant executive and Philidor’s ex-CEO were found guilty of engaging in a kickback scheme.
The plaintiffs, led by a group of health and welfare funds, are also seeking approval for a separate $125,000 cash settlement with Philidor and its former CEO.
Allegations that Valeant, which is now Canada-based Bausch Health Cos. Inc., created phantom sales through a shadowy network of specialty pharmacies surfaced in 2015 when a stock commentary website accused the drugmaker of cooking its books through Philidor and other dispensers.
The accusations sparked a stock plunge, which was exacerbated by the unveiling of a U.S. Securities and Exchange Commission investigation into the Philidor affair in early 2016.
Plaintiffs in this case — third-party payors — hit Valeant with a putative class action in May 2016, accusing it of violating the RICO Act by issuing them thousands of fraudulent statements inflating the reimbursements they owed for drugs.
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Plaintiffs are represented by James E. Cecchi of Carella Byrne Cecchi Olstein Brody & Agnello PC, Hannah Ross, James A. Harrod, Jai K. Chandrasekhar and James E. Fee of Bernstein Litowitz Berger & Grossmann LLP, Jeffrey W. Golan and Jeffrey A. Barrack of Barrack Rodos & Bacine, and Julie Goldsmith Reiser, S. Douglas Bunch, and Christopher Lometti of Cohen Milstein Sellers & Toll PLLC.
Pilgrim’s Pride Corp. has agreed to pay consumers $75.5 million to settle claims it conspired with competitors to fix the price of broiler chicken, the company’s latest deal in sweeping litigation filed in Illinois federal court over the alleged long-running scheme.
In a filing Thursday, the end-user consumer plaintiffs also said they’d cut a $1 million deal with Mar-Jac Poultry Inc. and its affiliated entities. The consumers counted the class action settlements as the fifth and sixth deals they’ve so far reached, bringing the total value of their settlements to $181 million, almost half of which comes from a $99 million agreement reached with Tyson Foods.
“In addition to monetary recovery, the current settling defendants’ agreement to provide cooperation will also strengthen consumers’ case against the remaining defendants,” the consumers said.
According to the brief, Pilgrim’s specifically agreed to provide up to three “then-current” employees as live trial witnesses. It also promised not to contest the depositions “of eight specified individuals,” agreed to respond to consumer questions “and otherwise assist EUCPs to understand structured data produced by Pilgrim’s,” take “reasonable efforts to authenticate documents,” and sit down with the consumers for seven hours to offer a “reasonably detailed description of the principal facts known to settling defendants,” including details previously given to federal investigators.
The settlement with Pilgrim’s could be called off, according to the brief, “in the unlikely event that more than 500,000 potential class members” bow out. The proposed Pilgrim’s class covers “millions” of consumer purchasers who bought chicken meat or whole chickens through 2020 in any of the roughly two dozen states and Washington, D.C., that have created exceptions to the federal law prohibition on so-called indirect purchasers winning antitrust damages.
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Pilgrim’s represents about 21.5% market share for the class, according to the brief, which extrapolated that amount to gauge how much money could be on the line overall.
So the $76.5 million in settlements equates to $3.6 million per point of market share — putting the value of this case over $360 million at this stage in the litigation,” the consumers said.
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The consumers are represented by Hagens Berman Sobol Shapiro LLP and Cohen Milstein Sellers & Toll PLLC.
Investors suing a group of Wall Street banks including Goldman Sachs and Credit Suisse for allegedly conspiring to manipulate the $14 trillion market for securities issued by the U.S. Treasury Department are fighting to keep their case alive after their initial complaint was dismissed in March.
On Wednesday, investors filed their omnibus opposition brief contesting the various dismissal briefs filed the same day by the large banks they’re suing. In it, they say their amended complaint includes the “proverbial smoking gun” in the form of direct evidence that U.S. District Judge Paul G. Gardephe said was missing in their initial complaint.
The amended complaint, which was submitted in May, relies heavily on testimony by a former senior executive of a UBS affiliate, where they describe how an “old boys club” consisting of primary dealers coordinated before an auction to get desirable results. The banks have argued that the complaint fails to sufficiently identify the executive, who is not named in the complaint.
“The Amended Complaint puts the witness at the scene of the crime: He had to buy and sell Treasuries for UBS’s own book, and his job responsibilities required him to communicate with UBS’s Treasury desk traders,” the investors said.
The suit against Bank of America, Barclays, BNP Paribas, Citigroup, Credit Suisse, Goldman Sachs, JPMorgan, Morgan Stanley, RBS and UBS was filed in 2015 after media reports of a U.S. Department of Justice investigation into possible manipulation of the Treasury market. It was consolidated into multidistrict litigation later that year.
The suit particularly accuses Goldman, JPMorgan, Barclays, Citigroup, Bank of America, Morgan Stanley and Credit Suisse of colluding with a trading platform called Tradeweb to block the emergence of new platforms where better prices could be obtained for Treasury securities traded after the auctions.
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The investors are represented by Quinn Emanuel Urquhart & Sullivan LLP, Cohen Milstein Sellers & Toll PLLC, and Labaton Sucharow LLP.
Citgo Petroleum Corp. shortchanges the pensions of certain retirees by calculating their benefits using “punitive” and “severely outdated” lifespan data, according to a proposed class action filed in the Northern District of Illinois.
The lawsuit, filed Tuesday by Citgo retiree Leslie Urlaub, challenges how Citgo calculates the benefits of married workers who choose pension formats that allow their surviving spouses to continue receiving benefits after their death. Urlaub says that before 2018, Citgo calculated these pensions using 50-year-old actuarial data that didn’t account for recent increases in lifespan, causing these workers to see their benefits unfairly reduced compared to employees receiving traditional, single-life pensions.
According to Urlaub, this practice violates the Employee Retirement Income Security Act’s requirement that all pension formats be the “actuarial equivalent” of a single-life pension.
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Causes of Action: Fiduciary breach and violations of the Employee Retirement Income Security Act.
Relief: Declaration of ERISA violations and fiduciary breach, plan reformation, injunctive relief, disgorgement, restitution, surcharge, order prohibiting the use of challenged actuarial assumptions, interest, attorneys’ fees, and costs.
Potential Class Size: Thousands of participants and beneficiaries in the Citgo pension plan who had their joint and survivor annuity calculated pursuant to the challenged actuarial assumptions.
Attorneys: The proposed class is represented by Cohen Milstein Sellers & Toll PLLC, Feinberg Jackson Worthman & Wasow LLP, Stris & Maher LLP, and the University of San Diego Law School.
Retired employees in two pension plans operated by Citgo Petroleum Corp. have sued the company, the pension plans and fiduciaries saying they were shortchanged in their retirement benefits.
The plaintiffs, seeking class-action status, allege they and other pensioners were harmed because the Citgo pension plans used out-of-date actuarial tables to calculate retirement benefits.
“Plaintiffs and class members receive pension benefits in the form of a joint and survivor annuity — a benefit that pays an annuity both to the participant for his life and for the life of the participant’s surviving spouse,” said the complaint filed Tuesday in a U.S. District Court in Chicago.
“In determining the amount of plaintiffs’ and class members’ joint and survivor annuities, however, defendants employed actuarial assumptions 50 years out of date,” according to the complaint.
Plaintiffs argued that this calculation meant pensioners “receive less than the ‘actuarial equivalent’ of their vested accrued benefit, contrary to ERISA,” said the complaint in the case of Leslie Urlaub and Mark Pellegrini vs. Citgo Petroleum Corp. et al.
The alleged shortchanging affects people who retired before Jan. 1, 2018, the complaint said
“Defendants appear to have recognized that these actuarial assumptions did not pass muster,” the lawsuit said.
“Effective January 1, 2018, they amended the plan to ensure that for those commencing benefits after January 1, 2018, the Plan employs updated and reasonable actuarial assumptions,” the lawsuit said. “But for people who began receiving benefits before 2018, defendants continue to employ punitive, unreasonable and severely outdated assumptions, which result in the class receiving less than their full pensions.”
Oregon officials believe a $90 million settlement it has reached with the parent company of Victoria’s Secret guarantees an end to its “culture of harassment and fear.”
Under the settlement, Victoria’s Secret and Bath & Body Works, owned by L Brands Inc., each committed to invest $45 million over at least five years to protect employees from harassment and discrimination and require accountability from executives when misconduct occurs, Oregon Attorney General Ellen Rosenblum and Treasurer Tobias Read said in a statement sent by email Monday.
It also releases former employees from non-disclosure agreements, allowing them to speak publicly about their experiences.
The settlement is on behalf of the Oregon Public Employees Retirement Fund and other shareholders who alleged that L Brands’ board of directors failed to investigate former CEO and Chairman Emeritus Leslie Wexner’s close personal ties with pedophile Jeffrey Epstein, and ignored a widespread culture of sexual harassment at the company, the two Oregon officials said.
According to a New York Times article published in February 2020, Wexner and his former chief marketing officer, Ed Razek, presided over an entrenched culture of misogyny, bullying and harassment at Victoria’s Secret, an underwear and lingerie company.
“By allowing a pattern of sexual misconduct, bullying and retaliation to go unaddressed the board of directors of L Brands failed to act in the best interests of stockholders,” Rosenblum said. “The days of promoting a culture of silent harassment and fear are over at Victoria’s Secret and other L Brands companies.”
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The settlement comes as Victoria’s Secret is splitting from L Brands to become its own public company.
L Brand’s board chair, Sarah Nash, said the settlement marks the full and final resolution of the stockholders’ claims of workplace misconduct.
“This global resolution, with its commitment to industry-leading governance policies, is an overwhelmingly positive result for the company and its stockholders,” Nash said. “It further prepares both Bath & Body Works and Victoria’s Secret for success as independent public companies with strong management teams and boards of directors committed to principles of diversity, equity and inclusion.”
The Oregon officials said the settlement resolves allegations from the state of Oregon and the Oregon Public Employees Retirement Fund as well as litigation filed by another shareholder, Milton Rudi, in the U.S. District Court of the Southern District of Ohio.
The owner of Victoria’s Secret will release current and former employees from certain nondisclosure agreements as part of a settlement of a shareholder lawsuit.
L Brands, the owner of Victoria’s Secret and Bath & Body Works, will release current and former employees from nondisclosure agreements tied to sexual harassment claims and take steps to promote diversity, equity and inclusion as part of a settlement with shareholders announced on Friday.
The company, which plans to separate Victoria’s Secret and Bath & Body Works into two public companies next week, said that each brand will spend $45 million each in the next five years to fund its new policies. Other changes include the establishment of a diversity, equity, & inclusion council and an overhaul of internal policies and training for sexual harassment and discrimination. The company will also exempt claims of sexual harassment, gender discrimination and related retaliation from mandatory arbitration.
The settlement followed allegations from shareholders, including the Oregon Public Employees Retirement Fund, that officers and directors of L Brands breached their fiduciary duties by fostering a culture of misogyny at the company, including around models, and by maintaining ties with Jeffrey Epstein, the sex criminal who was close to Leslie H. Wexner, the former chief executive of L Brands.
L Brands formed a special committee last year to investigate the allegations. The committee was led by two female independent board members and involved a different law firm than the company’s typical counsel.
“When our state invests public retirement dollars in a company, we have a duty to make sure our investments are sound — and the board acts in our best interest,” Ellen F. Rosenblum, Oregon’s attorney general, said in a statement. “There was a clear pattern at L Brands of a board that allowed key executives to use their power to promote a culture of fear, discrimination, and harassment.”
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Victoria’s Secret has revamped its executive team, and women occupy all but one seat on its new board of directors.
Mr. Wexner, a retail billionaire who is considered the modern-day founder of Victoria’s Secret, and his wife, Abigail, departed the L Brands board earlier this year. The brand has come under scrutiny since Mr. Wexner’s close ties to Mr. Epstein came to light in 2019 and a Times investigation showed that Mr. Wexner and his former chief marketing officer, Ed Razek, presided over an entrenched culture of misogyny, bullying and harassment.