The U.S. Soccer Federation, with its new legal team at Latham & Watkins LLP and a new president, appears ready to settle a pay discrimination lawsuit by players on the U.S. Women’s National Team, but experts say a misstep by former lead counsel at Seyfarth Shaw LLP has put the federation at a disadvantage in negotiations and could lead to bigger concessions.
Following an outcry over U.S. Soccer’s recent legal arguments that the men have more skill and their competitions are more difficult, the federation replaced Seyfarth Shaw and brought in Latham to lead its defense. U.S. Soccer also forced former president Carlos Cordeiro to step down earlier this month.
His successor, Cindy Parlow Cone, a former women’s national team player herself, said on Tuesday that “the comments and the language in the last filing I think not only hurt our relationship with our Women’s National Team but hurt women and girls in general.” Cone said that mending the relationship with the women’s team — and resolving the case to avoid trial — is now a top priority.
But experts say the women’s team has the leverage, at least for now, and that any settlement will likely require wider changes to the federation’s pay system to address the players’ complaints moving forward — especially as the men are poised for a new and potentially more lucrative labor agreement of their own.
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Now the question becomes: What offer will the federation make to the players?
“I think this group is actually looking forward to the future of soccer as well,” said Christine E. Webber, a partner in Cohen Milstein Sellers & Toll PLLC’s civil rights and employment practice group. “I actually think this a group that will get back pay for themselves but also use this as an opportunity to push U.S. Soccer to do better in the future.”
One complicating factor is that the men’s and women’s teams are represented by separate unions, and the men are playing under an expired collective bargaining agreement. The men’s players union has recently come out in support of the women’s players, saying the federation should “pay the women significantly more than our recently expired men’s deal.”
But the union is going to have an interest in pushing for even more pay in the next deal, making equal pay somewhat of a moving target.
U.S. Soccer is also now leaning on the argument that disparities in men’s and women’s team compensation is attributable to the separate labor agreements, reflecting different priorities among the players. The federation argues that the women negotiated for more guaranteed money and stability as opposed to the high risk, high reward bonus structure the men wanted.
Even so, the federation said it paid the women better than the men’s team over the past five years when factoring in all compensation including wages, bonuses and benefits. The women’s team has been far more successful on the pitch than the men’s team, though, winning the FIFA Women’s World Cup last summer.
The players have said that is not a legitimate defense and have even asked the judge to preclude the federation from bringing it up at trial. A ruling in their favor would significantly hamstring the federation’s legal defense and motivate it more to get a deal done rather than risk losing outright in a trial, attorneys said, though a decision may not come until the day of trial.
An impending ruling on both sides’ bids for summary judgment could narrow the issues or introduce more uncertainty. Waiting for that ruling could be a risk for both sides.
The players “certainly have enough to get to trial on, so I think there is more risk on U.S. Soccer than the women’s team, but both have a chance of not having summary judgment go their way,” Webber said. “So it is an opportune time for settlement discussions.”
A hearing scheduled for next week on both side’s bids for summary judgment was canceled due to the COVID-19 pandemic, increasing uncertainty about the May 5 trial date.
The parties may have a desire to strike now while there is time pressure to get a deal done, experts said.
“I think litigants are often very dug into their positions,” Webber said. “But this is a group of women who are very strategic. I don’t think they would be unable to think through the pros and cons of a good settlement.”
The complete article can be viewed here.
New information has emerged in a class action lawsuit against the social media giant.
Advertisers who turned to Facebook for the massive reach of its platform have been bamboozled by a faulty metric that executives have known about for years, according to an amended complaint filed last week in a lawsuit originally filed in 2018. The “potential reach” metric, supposed to estimate an ad’s target audience, is misleading because it could include fake and duplicate accounts, according to the filings.
The filings allege the potential reach metric for certain U.S. states and demographics exceeded U.S. census figures, a clear case of inflation. For example, in every state, the true population between 18 and 34 years old was lower than the potential reach Facebook reported.
The amended lawsuit claims that Facebook was aware it was misleading customers as early as 2015. Chief Operating Office Sheryl Sandberg and Chief Financial Officer David Wehner were named in the filings, but their remarks and actions were mostly redacted.
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Will any of this matter?
Facebook has had issues with inflated metrics in the past. In 2016, the company disclosed it was overestimating viewing times for video ads. Facebook settled the related lawsuit, although it blamed a calculation error and denied any wrongdoing.
While Facebook’s revenue growth has slowed in recent years, it probably has more to do with its size than any negative impact from that scandal. In 2019, the company reported revenue of $70.7 billion, up 27% from 2018.
The amended lawsuit over the potential reach inflation makes a stronger case that Facebook was aware of the problem, but it also seems unlikely to drive advertisers away.
There is one wild card in all of this: The global novel coronavirus pandemic. With heavy advertisers like the travel industry in tatters, Facebook and all advertising platforms will probably see lower demand from certain advertisers in the coming weeks and months. With Facebook needing to fight for advertising dollars amid a global recession, its questionable actions could come back to bite it.
It now seems clear Facebook took the low road as it worked to maximize its revenue. Only time will tell whether any of this will affect its gigantic advertising empire.
New court documents claim company was aware key ad metric was exaggerating marketing reach.
Facebook executives allegedly “knew for years” that a key advertising metric was exaggerating how many users might see commercials on its site, but have failed to disclose or fix the problem, according to filings from a class-action lawsuit against the company.
New court documents from the lawsuit, which was filed in Northern California in 2018 by a small-business owner, claim that Facebook personnel knew that its so-called potential reach metric, used to inform advertisers of their potential audience size, was “inflated and misleading”.
The documents go on to name chief operating officer Sheryl Sandberg and David Wehner, Facebook’s financial officer, in the context of internal communications in which they were involved in 2017. Their remarks and actions have largely been redacted from the documents, however, on the grounds that they are commercially sensitive for Facebook.
The lawsuit claims that Facebook represents the potential reach metric as a measure of how many people a given marketer could reach with an advertisement. However, it actually indicates the total number of accounts that the marketer could reach — a figure that could include fake and duplicated accounts, according to the allegations.
In some cases, the number cited for potential audience size in certain US states and demographics was actually larger than the population size as recorded in census figures, it claimed.
“Facebook’s failure to remove duplicate and fake accounts from its potential reach metric makes the metric fundamentally misleading,” the complaint said. Facebook, as of March 3, “still has not removed the fake and duplicate accounts from its potential reach calculation”, the documents claim.
Facebook’s own estimates in financial filings suggest that duplicate accounts represented approximately 11 per cent of its 2.5bn monthly active user count for the fourth quarter of 2019, while fake ones accounted for another 5 per cent.
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The new court documents allege that some employees “expressed concerns” about the alleged “inflation” of potential reach but no action has been taken.
One filing alleged that Ms. Sandberg made “substantive comments” in a meeting in October 2017 where potential reach was discussed.
Mr. Wehner also discussed fake and duplicate accounts in a meeting the same month, but on a later earnings call “did not disclose the direct impact of duplicate and fake accounts . . . on potential reach”, according to the complainants.
Social-media giant says estimates weren’t guarantees, didn’t harm customers; court filing includes employee worrying about possible lawsuit in email
Facebook Inc. employees were aware that the company was overestimating how many people advertisers could reach, according to an amended complaint filed this week in a nearly two-year-old lawsuit accusing the company of misrepresenting that data.
“This is a lawsuit waiting to happen,” a Facebook product manager wrote to colleagues in October 2018, regarding the company’s alleged overstatements, according to the amended complaint filed Thursday. The emails were produced as part of the discovery process in the lawsuit, which is seeking class-action status and was originally filed by a small-business owner in federal court in San Francisco in 2018.
A Facebook spokesman declined to comment on the material in the amended complaint, but the company has previously said the estimates were never meant to be precise guarantees and couldn’t plausibly have harmed customers.
Facebook defines the “potential reach” to advertisers as an estimate of an ad’s target audience. According to the amended lawsuit, Facebook’s potential reach among the 18- to 34-year-old demographic in every state exceeded the actual population of those 18- to 34-years-old.
This isn’t the first time Facebook has been accused of inflating metrics relied upon by advertisers. In 2016, the company disclosed that it had overestimated viewing time for video ads. Advertisers sued after the disclosure, and Facebook later settled that lawsuit, saying it made an error in calculating its metrics and denying the other allegations.
According to the amended lawsuit, Facebook first learned about concerns that it was misleading customers about how many people could see their ads in 2015 but did nothing about it. The complaint says Facebook held at least four meetings in early 2018 to discuss the alleged reach inflation but didn’t provide further details.
In the 2018 email, the product manager likened the alleged overstatement to the 2016 revelation that Facebook’s video viewership statistics were erroneously inflated.
Other employees shared the product manager’s concern, according to the amended lawsuit. “My question lately is: How long can we get away with the reach overestimation?” one employee wrote, according to the Thursday filing.
Some sections of the complaint are redacted, including descriptions of emails written and actions taken allegedly by Chief Operating Officer Sheryl Sandberg and other executives.
Participants in a 401(k) plan offered by Wells Fargo & Co. sued the company and fiduciaries, alleging that plan executives violated ERISA by using several proprietary investments and failing to explore cheaper and better-performing options.
The defendants chose investments “that benefited Wells Fargo & Co. and its subsidiaries and executives,” said the complaint filed March 13 in a U.S. District Court in San Francisco.
“Defendants selected and retained Wells Fargo products over materially identical, yet cheaper, non-proprietary alternatives,” said the complaint in the case, Becker vs. Wells Fargo & Co. et al.
They “selected Wells Fargo products that had no performance history that could form the basis of a fiduciary’s objective decision-making process,” said the plaintiffs in seeking class-action status. The defendants also “failed to remove proprietary funds despite sustained under performance.”
Among the specific products criticized by the plaintiff was a target-date series using a collective investment trust that was added to the plan lineup in 2016. This series “had no prior performance history or track record which could demonstrate that they were appropriate funds for the plan,” the lawsuit said. Still, the plan mapped $5 billion of participants’ assets into this option from the existing target-date series.
The plaintiff argued that a “prudent fiduciary process” requires at least a three-year performance history of an investment before it should be considered for a plan lineup. The lawsuit also criticized fiduciaries for retaining a Wells Fargo money market fund “without adequately considering non-proprietary alternatives,” adding that this fund has experienced “more than a decade of underperformance and high fees.”
Wells Fargo & Co. has been hit with a proposed class action accusing the financial services company of mismanaging its $40 billion 401(k) plan by steering more than $5 billion of its workers’ retirement savings into proprietary funds that have cost them $100 million in losses.
Yvonne Becker, a former Wells Fargo employee, lodged her Employee Retirement Income Security Act suit against the company, its board of directors, two committees, Galliard Capital Management and others in California federal court Friday.
Becker alleges in her complaint that the defendants — which she contended were fiduciaries to the Wells Fargo & Co. 401(k) Plan — ran afoul of their duties under the federal benefits law. Galliard is a subsidiary of Wells Fargo that acted as an investment manager for the plan, according to the pleadings.
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Daniel R. Sutter, an attorney for Becker, told Law360 on Monday that it was “especially important that Ms. Becker and other participants’ retirement savings are restored and protected from Wells Fargo’s conflicts of interest during this time of historic economic uncertainty.”
“Disregarding basic fiduciary norms, Wells Fargo selected proprietary investments for its employees’ retirement savings that lacked any performance history and have significantly underperformed their benchmarks since their inception,” Sutter said.
Becker is represented by Michelle C. Yau, Mary J. Bortscheller and Daniel R. Sutter of Cohen Milstein Sellers & Toll PLLC, and Todd Jackson and Nina Wasow of Feinberg Jackson Worthman & Wasow LLP.
Five years ago, lead seeped into the tap water in Flint, Michigan, while state and local officials said everything was fine. Now, the same doctor who proved something was wrong is taking the first comprehensive look at the thousands of kids exposed to lead in Flint.
You may remember the pictures from the water crisis five years ago in Flint, Michigan. Hundreds of angry residents holding up bottles of rust-colored water and demanding answers. Months of protests were waved off by officials who denied anything was wrong. The turning point came when a local pediatrician found conclusive proof that the children of Flint were being exposed to high levels of lead in their water and prompted the state to declare an emergency. Now, that same doctor is working to solve a mystery that still worries parents in Flint: What lasting damage did the water do to their kids? Tonight, you will hear her initial findings which she says are worse than she feared. But we begin with the legacy of Flint’s water crisis.
Once a week, hundreds of cars line up for bottled water at the Greater Holy Temple Church of God in Flint.
Sandra Jones is in command. She is a pastor’s wife with the voice of a four-star general. Jones keeps the cars moving and the water coming. Each family is allowed four cases of water. On this day, they gave away 36,000 bottles.
Sharyn Alfonsi: It just strikes me. It’s been five years and you’re still doing this.
Sandra Jones: Five years. And– and the thing about it is it’s not lightening up. I could see it if it was lightening up. But it isn’t.
It is not. The state stopped giving away bottled water two years ago because it said the water is safe. Sandra Jones relies on donations of water.
Sharyn Alfonsi: What’s it been like?
Larry Marshall: It’s been kinda hard…
Larry Marshall was second in line. The widowed father of four got here at 5 a.m. He’s been waiting five hours for water.
Larry Marshall: Water should be a basic necessity that — we shouldn’t have to wait or stand in line for, you know. This is not a third world country. But we’re living like one.
Marshall, like many in Flint, still refuses to drink tap water.
Sharyn Alfonsi: And if they come to you the city or the state and they say, “You’re drinking water’s safe. Are you gonna believe them?
Larry Marshall: No. They lie so much and we know they lie, and I– when they say something, it’s like– talking to the wind, you know. I don’t believe nothing they say. None of the politicians, none of them.
Flint, once a prosperous hub of the American auto industry was nearly bankrupt back in 2014. Officials hoped to save money by switching the city water source from the Great Lakes to the Flint River.
Almost immediately, residents began noticing something wasn’t right. The water was rust colored and many people had rashes.
But Michigan’s department of environmental quality and the city insisted the water in Flint is safe. Later, a state investigation found those officials hid the fact that the river water was not treated with chemicals that would prevent the pipes from corroding. So, for months the water ate away at Flint’s old pipes, releasing lead into residents’ tap water.
A Virginia federal judge has given the final greenlight to a settlement that knocks Par Pharmaceutical out of a massive suit accusing Merck and Glenmark of plotting to hold off generic versions of Zetia and inflating the cholesterol drug’s costs.
Par, which got roped into the case as a distributor to wholesale and retail drug buyers, reached the deal with direct purchasers in June to exit the case. The buyers allege that Merck and Glenmark entered into an anti-competitive deal to delay cheaper versions of the medication.
U.S. District Judge Rebecca Beach Smith signed off on the deal’s final approval Friday, cementing the settlement between Par and a class of Zetia buyers. Direct purchasers’ underlying claims against Merck and Glenmark continue save for claims covering purchases of Glenmark’s generic Zetia during a period that Glenmark had been given market exclusivity from Merck, which were dismissed Dec. 20.
Friday’s order notes that under terms of the settlement, Par agreed to provide, on an expedited basis, documents, data and deposition testimony, including testimony at trial if necessary, in the ongoing litigation against Merck and Glenmark.
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The direct purchasers are represented by Glasser and Glasser PLC, Hagens Berman Sobol Shapiro LLP, Hilliard & Shadowen LLP, Kessler Topaz Meltzer & Check LLP, Radice Law Firm PC, Sperling & Slater PC, Roberts Law Firm PA, Shepherd Finkelman Miller & Shah LLP, Nussbaum Law Group PC, Taus Cebulash & Landau LLP, Berger & Montague PC, Faruqi & Faruqi LLP and Cohen Milstein Sellers & Toll PLLC.
U.S. District Judge Charles Breyer of the Northern District of California opened the hearing by saying that he clearly thought that the plaintiffs had standing to sue. “I think there was injury, and I think that it’s an important vindication of an individual’s rights to be able to seek redress in a court for an injury, especially for an injury for privacy,” Breyer said.
The federal judge overseeing the long-running civil litigation over claims that Google’s Street View vehicles snooped on unencrypted WiFi networks at the turn of the last decade grappled with objections to a proposed $13 million class action settlement the company has proposed.
U.S. District Judge Charles Breyer of the Northern District of California called the matter before him “a paradigmatic case of injury and non-ascertainable damages” at a fairness hearing Friday over the proposed deal, a so-called cy pres settlement that would provide no direct payout to class members.
The proposed deal faced objection from a group of state attorneys general concerned about the lack of cash going to plaintiffs as well as an objector represented by class action watchdog Ted Frank of the Center for Class Action Fairness.
Breyer opened the hearing by saying that he clearly thought that the plaintiffs had standing to sue. “I think there was injury, and I think that it’s an important vindication of an individual’s rights to be able to seek redress in a court for an injury, especially for an injury for privacy,” Breyer said. Breyer held off ruling, saying he intended to lay out his thoughts in a forthcoming written opinion. But the judge spent much of the hearing probing counsel for the company and the class about issues raised by the deal’s critics.
Representing the proposed settlement class, Cohen Milstein Sellers & Toll’s Daniel Small said that there are an estimated 60 million class members—a number partially based on Google’s disclosure to the Canadian government that its Street View vehicles collected data from 6 million unencrypted commercial and residential wireless networks in that country, which has about a 10th of the population of the U.S. Small said that the proposed deal before Breyer would add at least two years to the injunctive relief, including internal privacy policy changes and additional web disclosures from Google, which state attorneys general secured in their own 2013 settlement with Google.
In settling one dispute over the law that governs retirement plans, the Supreme Court may have opened the door for others down the road.
The court set a new standard for determining the deadline for litigation over 401(k) plans under the Employee Retirement Income Security Act in a unanimous ruling Wednesday, but attorneys for plan sponsors say the decision left additional questions unanswered that could make their way back into court.
Sending employees and retirees plan information online or by mail isn’t enough for employers to shorten the six-year deadline for litigation to three years, the high court found. The justices said plan participants must read those documents because the law requires “actual knowledge” of the alleged violation in order for the lawsuit window to shrink.
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The court explicitly noted that it wasn’t asked, and therefore didn’t address, what exactly a plaintiff must actually know about a defendant’s conduct and the relevant law in order to trigger a shorter filing deadline. The statement came in a footnote and reads like an invitation for defense attorneys to raise the question in future litigation.
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Attorneys for plan participants are less concerned that these questions will become big battleground areas in ERISA litigation.
What information plan participants must know theoretically is an open issue, said Michelle Yau, a partner at Cohen Milstein Sellers & Toll PLLC, but she predicted it won’t see much action in court.