Oct 13, 2021
On September 23, 2021, the Honorable William H. Orrick, U.S. District Judge for the Northern District of Californ
• LIFE INSURANCE SALES PRACTICES – Joe was co-lead counsel for policyholders in a series of deceptive life insurance sales practice class actions involving replacement, vanishing premium and other sales schemes by MetLife, MassMutual and other of the largest life insurers in the United States. These class actions struck at the heart of one of the most massive deceptive sales schemes in life insurance industry history. They spurned numerous market conduct investigations, enforcement actions and hundreds of millions of dollars in fines by insurance regulators.
The MetLife and MassMutual class actions alone spanned more than a decade with dozens of depositions taken, millions of documents reviewed, multiple appeals argued, and numerous contested motions for summary judgment, class certification, experts and discovery. MassMutual itself lasted nine years and was litigated as a certified class until it was settled just a few weeks before a trial in New Jersey state court was scheduled to start.
Ultimately, Joe and his co-counsel recovered more than $2.4 billion in benefits for millions of MetLife and MassMutual policyholders nationwide victimized by these practices. See Varacallo v. Massachusetts Mutual Life Insurance Company, 226 F.R.D. 207 (D. N.J. 2005) and 752 A.2d 807 (N.J. App. Div. 2000); Gaidon v. Guardian Life Insurance Company of America and Russo v. Massachusetts Mutual Life Insurance Company, 96 N.Y.2d 201 (2001); In Re Metropolitan Life Insurance Company Sales Practices Litigation, 1999 WL 33957897 (W.D.Pa.); Cope v. Metropolitan Life Insurance Company, 696 N.E. 2d 1001 (Ohio 1998); Richard v. Metropolitan Life Insurance Company (a/k/a In re Metropolitan Life Insurance Company Policyholders Litigation),707 A.2d 512 (Pa. 1998).
• INFLATED APPRAISALS FOR MORTGAGE BORROWERS – Joe was co-lead counsel for mortgage borrowers in a class action against eAppraiseIT involving its scheme with Washington Mutual to inflate the value of appraisals to enable Washington Mutual to justify over-valued, sub-prime home loans. This practice by eAppraiseIT and Washington Mutual was identified by a bi-partisan committee report of the United States Senate as one of the causes of the 2008 sub-prime crisis that was the worst economic crisis since the Great Depression. Permanent Committee on Investigations, United States Senate, Wall Street and the Financial Crisis: Anatomy of a Financial Collapse, pp. 187-190 (April 13, 2011). The New York Attorney General and the FDIC also filed enforcement actions against eAppraiseIT for these practices, recovering millions of dollars in fines and penalties, but without compensation for borrowers.
Joe was the primary counsel arguing before the Court in the eAppraiseIT class action, which sought compensation for borrowers. It was hotly litigated for seven years as a certified class with dozens of depositions, hundreds of thousands of documents, dozens of motions and numerous experts. It was settled just before trial was to begin, recovering nearly $10 million. Spears v. First American eAppraiseIT, 2014 WL 4647679 and 2015 WL 1906126 (N.D. Cal.).
• LENDER’S FORCED PLACED INSURANCE – When a home or auto loan borrower fails to maintain insurance on the home or auto, the lender will force place insurance and charge it to the borrower. Lender forced place insurance covers far less and costs far more, and typically entails kickbacks and other improper charges that the borrower is asked to pay.
Joe started in the mid-1990s representing classes of borrowers with forced placed auto insurance and, along with Ellen Doyle, recovered millions of dollars for borrowers victimized by these practices. See Kenty v. Bank One, 650 N.E. 2d 863 (Ohio 1995) (companion case 92 F.3d 384 (6th Cir. 1996)); George v. BancOhio National Corporation, Civil Action No. C2-92-314 (S.D. Ohio); Regina G. Bates v. National City Bank, Case No. 279634 (Cuyahoga Co., OH).
More recently, Joe, along with his partner Jim Pietz, was co-lead counsel representing approximately 550,000 California homeowners against American Security Insurance Company (ASIC) for placing duplicative hazard insurance coverage and charging homeowners for this unnecessary coverage. The Court certified the class which ASIC’s lawyers called the largest litigation class ever certified for insurance policyholders. In 2011, the case settled for class-wide relief valued at $86 million, including prospective relief in the form of reduced premiums. Wahl v. American Security Insurance Company, 2010 WL 1881126 (N.D. Cal.).
• PRODUCT MISLABELING – Joe was co-lead counsel in several food and cosmetic mislabeling class actions seeking compensation for consumers against some of the largest manufacturers, including Kashi, Trader Joe’s, Diamond Foods and Hain Celestial.
The Kashi class action challenged Kashi’s “Nothing Artificial” and “All Natural” labeling. Joe was the primary counsel arguing before the Court for the class. Kashi was the first “All Natural” case certified as a litigation class. Kashi was heavily litigated until weeks before trial, ultimately resulting in a $5 million class settlement for California consumers, which at the time was the largest single state class settlement in a food labeling case. Astiana v. Kashi Company, 291 F.R.D. 493 and 295 F.R.D. 490 (S.D. Cal. 2013).
Likewise, Diamond Foods was litigated to the brink of trial and resulted in a $2.8 million class settlement involving unlawful Omega-3 heart health claims. Diamond Foods was one of only a few nationwide litigation classes certified for food mislabeling. Zeisel v. Diamond Foods, Inc., 2011 WL 2221113 and 2012 WL 4902970 (N.D. Cal.).
Trader Joe’s was an “All Natural” mislabeling case that resulted in a $3,375,000 nationwide class settlement. Larsen v. Trader Joe’s Company, 917 F.Supp.2d 1019 and 2014 WL 3404531 (N.D. Cal.).
In Hain Celestial, Joe was successful in having the Court of Appeals refine the legal standards for federal preemption and primary jurisdiction in cosmetic and food mislabeling cases, arguing before the United States Court of Appeals for the Ninth Circuit in Astiana v. The Hain Celestial Group, Inc., 783 F.3d 753 (9th Cir. 2015).
• FORCED ARBITRATION AND CLASS ACTION WAIVERS – In 2011, the United States Supreme Court issued its opinion in AT&T Mobility LLC v. Concepcion, 563 U.S. 333 (2011) reversing the Ninth Circuit and creating a new standard heavily favoring the enforceability of forced arbitration and class action waiver clauses in consumer agreements. Joe argued the appeal before the Ninth Circuit where Concepcion was joined for oral argument with another class action in which Joe was co-lead counsel, Kaltwasser v. Cingular Wireless LLC, 543 F.Supp.2d 1124 (N.D. Ca. 2008), aff’d 2009 WL 3157688 (9th Cir., Oct. 1, 2009). Joe also filed an amicus curie brief in support of Concepcion before the Supreme Court.
The fallout from the Supreme Court’s decision has been severe, effectively preventing millions of consumers from vindicating their rights and enabling massive corporate fraud such as the recent Wells Fargo unauthorized accounts scheme to go unchecked for years as recognized by members of the United States Senate committee investigating that scheme. The Consumer Financial Protection Bureau (CFPB) has announced its intention to ban forced arbitration and class action waivers, but that would only apply to consumer financial agreements. Public Justice and others, including Joe, continue to fight to overturn Concepcion or at least limit its harsh application.
• INSURANCE POLICYHOLDERS – Joe has fought for policyholders’ rights in a variety of other class actions. They include:
Recovered $110 million for a class of over a half million participating policyholders deprived of a few hundred million dollars of dividend payments withheld in violation of state surplus fund laws. Harshbarger v. The Penn Mutual Life Insurance Company, 2017 WL 6525782 and 2014 WL 1409445 (E.D. Pa.).
A class action for failing to pay participating policyholders adequate compensation for the loss of their ownership rights in an insurer’s demutualization. Cranley v. National Life Insurance Company of Vermont, 318 F.3d 105 (2nd Cir. 2003).
A class action for long-term care policyholders who were victims of massive premium increases and alleged deceptive sales practices. Taylor v. Bankers Life & Casualty Co., Civil Action No. C08-0447 (W.D. Wash.).
Class actions for an insurer’s under-reimbursement of out-of-network health care provider charges by using artificially low UCR rates, causing policyholders to make more out-of-pocket payments. In re: WellPoint, Inc. Out-Of-Network “UCR” Rates Litigation, 865 F. Supp. 2d 1002 (C.D. Cal. 2011).
A class action for charging non-smoking juveniles smoker-based life insurance rates. Bethea v. Metropolitan Life Insurance Company, 2009 WL 690852 (N.J., App. Div.) (reinstated by Appellate Division).
A class action for failing to refund pro rata life insurance premiums upon surrender. Lambros v. Metropolitan Life Insurance Company, 111 Cal.App. 4th 43, 3 Cal. Rptr. 3d 320 (2003).
A class action recovering millions of dollars for rental car customers purchasing unnecessary, duplicative and high priced insurance products and collision damage waiver from Enterprise. Delaney v. Enterprise Rent-a-Car Company, Inc. and ELRAC, Inc., Docket No. OCN-L-1160-01 (Superior Ct. of NJ, Ocean County).
• DATA BREACH – Consumers expect that when their medical, financial, social security numbers and other personal information are entrusted to credit reporting agencies and health insurers that they will take reasonable precautions to prevent hackers from accessing consumers’ personal information leading to identity theft or other financial harm to consumers.
Joe is currently litigating and has litigated class actions to help data breach victims. Joe was a member of the Plaintiffs’ Steering Committee in a class action for victims of a credit reporting agency’s data breach of identification information for 15 million people, which resulted in a settlement valued at more than $170 million for class members. In re: Experian Data Breach Litigation, Case No. SACV 15-1592 AG (DFMx) (C.D. Cal.). Joe is also Plaintiffs’ counsel in a class action for victims of a health insurer data breach of insureds’ medical and identification information of several million insureds. In re: Premera Blue Cross Customer Data Security Breach Litigation, Case No. 3:15-md-2633-SI (D. Oregon).
• ERISA AND PENSIONS – Employees expect that when they retire they will receive the pension and health insurance benefits their employer promised. All too often employers try to cut those benefits after you retire. FDPK has and continues to pursue numerous class actions to keep companies from cutting promised retiree benefits. Joe has litigated some of those cases with his partners.
Joe, along with his partner Bill Payne, were co-lead counsel in a class action that recovered $13 million for retirees of a church affiliated hospital whose pension plan (a/k/a Church Plan) was underfunded. Orlowski v. St. Francis Health Systems, No. GD 02-17811 (Allegheny County, Pa.). Joe, again with his partner Bill Payne, were co-lead counsel in an ERISA class action recovering health insurance premium overcharges from an employee health plan for charging Medicare eligible participants a higher non-Medicare eligible premium rate. Magliulo v. Metropolitan Life Insurance Company, 205 F.R.D. 55 (S.D.N.Y. 2002). Joe was also co-lead counsel in an ERISA class action against employer’s pension plan for not paying deferred vested retirees the cost-of-living increases “COLA” paid to all other retirees. Brubaker v. Metropolitan Life Insurance Company, 482 F.3d. 586 (D.C. Cir. 2007).
• WAGE AND HOUR – Employees expect to be paid the wages they earned for hours they worked. Many employers either fail to pay the state required minimum wage or overtime wage. Joe has litigated class actions in multiple states seeking to recover these unpaid wages for employees. See Baum v. AstraZeneca, 605 F. Supp. 2d 669 (W.D. Pa. 2009), Hummel v. AstraZeneca, 575 F. Supp. 2d 568 (S.D. N.Y. 2008), Brody v. AstraZeneca, 2008 WL 6953957 (C.D. Cal., June 11, 2008) (Joe was class counsel in PA, NY and CA state wage and hour class actions for unpaid overtime).
• ANTITRUST – Businesses often conspire to fix the price of goods over which they collectively have a monopoly or market dominance. Such a price-fixing conspiracy violates federal and state anti-trust laws causing consumers and other purchasers to pay more than they would in a free market. Joe has litigated several class actions for victims of these price-fixing conspiracies. Erie Forge and Steel, Inc. v. Cypress Minerals Company, 1994 WL 485803, 1994 Trade Cases P 70, 653 (W. D. Pa., Jun. 7, 1994) (No. Civ. 94-404) (Joe was class counsel for antitrust price-fixing conspiracy that inflated the price of molybdenum used as an additive in steel production and petroleum products); In re Flat Glass Antitrust Litigation (II), 2009 WL 331361 (W.D. Pa., Feb. 11, 2009) (Joe was counsel in an antitrust price fixing claims against manufacturers of flat glass used in windows and other products).
• SECURITIES FRAUD AND DERIVATIVE – Joe represented shareholders in securities fraud class actions and derivative actions who lost money or rights from corporate fraud, misrepresentations or non-disclosure. In Re Tollgrade Communications, Inc. Derivative And Class Action Litigation, Consolidated Case No. GD-11-003755 (Court of Common Pleas Alleg. Co. 2011) (Joe was co-lead counsel in a derivative and shareholder class action for withholding and concealing information regarding sale of public company to private equity firm); Warden v. Crown American Realty Trust, 1998 WL 725946 (W.D.Pa.); and Bell v. Fore Systems, Inc., 17 F. Supp. 2d 433 (W.D. Pa. 1998) (Joe was shareholders’ counsel in a securities fraud class action).
Additional class actions in which Joe has or had a leadership or other counsel role:
• Loan Servicer Overcharges – Joe is co-lead counsel in a class action for borrower victims of an alleged RICO conspiracy to inflate default service charges on homeowners’ loans. Giotta v. Ocwen Financial Corporation, Case No. 5:15-cv-00620-BLF (N.D. Cal.).
• Student Loan Abusive Practices – Joe was co-lead counsel for student loan borrowers in a class action for unlawful late fees and usury on Sallie Mae (now Navient) student loans. Ubaldi v. SLM Corp., 852 F.Supp.2d 1190 (N.D. Cal. 2012).
• Auto Manufacturer’s Fraudulent Practices – Joe was co-lead counsel in a series of state-wide class action against Ford for charging for upgraded radiators and not providing them. Ultimately, the class actions settled recovering millions of dollars of overcharges for truck purchasers. Zeno v. Ford Motor Company, 238 F.R.D. 173 (W.D. Pa. 2006) and 480 F.Supp.2d 825 (W.D. Pa. 2007). Joe is also counsel in a consolidated class action for owners of vehicles Volkswagen fraudulently marketed as “clean diesel,” when Volkswagen knew the vehicles did not meet the EPA’s “clean diesel” requirements and deliberately designed the vehicles’ computer to evade government emissions testing. In re: Volkswagen “Clean Diesel” Marketing, Sales Practices, and Products Liability Litigation, Civil Action No. 3:15-md-02672-CRB (N.D. Cal.).
• Investment Brokerage Fraud – Joe was co-lead counsel in an investors’ class action for failure to properly invest mutual fund dividends held through a Merrill Lynch ROTH IRA or other custodial account. Payne v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 2003 WL 21940609 (4th Cir. (MD) August 14, 2003).
• Illegal Credit Card Fees – Joe represented the State of West Virginia on behalf of credit card consumers who were alleged to have been overcharged due to a variety of illegal and unconscionable practices by Capital One. West Virginia ex rel. McGraw v. Capital One Bank USA, N.A., 2010 WL 2901801 (S.D. W.Va.).
• Oil and Gas Royalty Underpayments – Joe is co-lead counsel in a class action for oil and gas royalty holders who have been underpaid by leaseholder’s deducting arbitrary flat rates for “shrinkage” costs rather than using the actual amounts. Regmund v. Talisman Energy USA, Inc., Civil Action No. 4:16-cv-02960 (S.D. Tex.).
On September 23, 2021, the Honorable William H. Orrick, U.S. District Judge for the Northern District of Californ