Fighting the robber barons: Illegal debt card charges for overdrafts

News today that West Coast Bank reached an agreement with the FDIC relating to its “courtesy coverage” overdraft protection. According to Brent Hunsberger’s report in The Oregonian, the issue was ineffective opt outs. But there is a bigger problem with Oregon banks ordering transactions in a way that triggers a cascade of overdraft charges.

I’m particularly interested in this area and looking at various cases. If you have had multiple overdraft charges assessed by Umpqua Bank, I’m interested in talking to you about the problems.

While it’s good that the FDIC stepped in, I am concerned that they did not fully take care of consumers who were affected by West Coast Bank’s overdraft charges. Still, enforcement is essential. Failing that, those of us who dare to fight the robber barons provide the next best thing.

Feel free to contact me if you have a story about Umpqua or any other Oregon bank that is overcharging on overdraft fees.

David Sugerman

ARCO debit card fees–Again?

Oregon readers know about our gasoline rules. In Oregon, there is no self-service. So when you pull up to the pump and ask the attendant to gas it up, you commit to the purchase the minute the gas starts flowing into your tank.

ARCO does not take credit cards. Consumers can pay cash or with debit cards.

Over a decade ago, I did my first consumer class action against ARCO in Oregon. They were charging an undisclosed debit card fee for consumers who paid with debit cards.

After a hard-fought battle, we settled that class action case many years ago. Part of the settlement required ARCO to post debit card fee disclosure signs at the pump. We demanded the fee notices so that consumers would know before committing to the purchase that they were paying an extra charge.

That extra charge is now 45 cents per purchase. So when you buy five gallons worth of gas, it is nine cents per gallon more than the posted price if you pay with a debit card.

That’s right. It appears that ARCO, which is now a subsidiary of Gulf oil spill British Petroleum, is back to nickel and diming consumers. My annoyance knows no bounds…I really dislike nickel and diming consumers.

If you have had a problem with ARCO debit card charges in Oregon, I would appreciate a call or an email so that we can properly analyze and address this problem.

Providence data breach case: Oregon Supreme Court argument

I had the pleasure of watching my dear friend and colleague Maureen Leonard argue Paul v. Providence in the Oregon Supreme Court today. She did a fabulous job of articulating our position, both in her briefing and at oral argument.

The Oregon Supreme Court was not at full strength. Justice Durham has been out of town this week but will participate in decision of the case. Justice Kistler apparently recused himself. One of the things that struck me as I listened to argument and the questions from the bench is how lucky we are in Oregon to have the kind of judiciary that we do.

Don’t misunderstand me. We could easily lose this case. Some of the individual questions from the judges were not friendly to us or our theories about why Providence should have to account for breaching confidentiality of 350,000 patients’ medical records. But still, there is a genuine desire in the Supreme Court to get things right and an openness that strikes me as Oregon at its best.

The defense argued strongly. They have the benefit of having won at the trial court and Oregon Court of Appeals. Still, I like how things went today.

It can take the Supreme Court a long time to issue an opinion. All of us who toil in the courts know that how oral argument felt is often not much of a predictor of the outcome. So I don’t put a lot of significance in Maureen’s great day. Still, you have to feel good when it seems like the court understands your position.

All of this is from something of a skewed perspective. I am the guy who lost in both lower courts. My work was the basis of heavy defense criticism in oral argument today. Still, I am convinced that we are right. And of course we will see it through to the end.

 

Update: Western Culinary Institute/Le Cordon Bleu Portland and CEC consumer fraud class action

For those tracking this case, two updates worth noting.

1. As noted recently, Western Culinary/LCB Portland and Career Education Corp filed a motion to compel arbitration and to dismiss this case. More info on that motion here. The hearing date on the motion has been changed to October 7, 2011.

2. There have been many media reports on the settlement of California Culinary Academy (CCA) class action. Some have erroneously reported that the settlement includes this case against Western Culinary Institute. Not correct. I am not connected with the CCA case, so I don’t pretend to know what is going on there. But our case has not settled. That is why we are pushing forward toward trial.

Thanks for checking back and for your continuing patience and interest in the case. If you’re a class member, know that our team continues the long fight. Call or email if you have questions.

David

Consumer fraud class action update: Western Culinary Institute, Le Cordon Bleu, Career Education Corp.

Late yesterday, Career Education Corp and Western Culinary Institute/Le Cordon Bleu Portland filed a motion to compel arbitration in our consumer fraud class action. More on the case here.

Short version is that three years after we filed the case, after the trial court certified a class action, after class notice went out, and after the opt out period ran, the defendants filed a motion to compel arbitration. The motion will require a lot of work from the class legal team, but of course, that is why we are here.

It’s a bit hard to fathom why the Career Education Corp and its school waited so long to file their motion. Their story is that they could not have won their motion until the U.S. Supreme Court decided AT&T Mobility v. Concepcion. For reasons best left to the briefing, they are so very wrong in a number of ways.

In many places in their brief, they make arguments that remind me of this video:

Inconceivable!

I suppose in the end we are talking about delay. But of course that’s a problem that bites them as hard as it bites the class. They are on the hook for prejudgment interest if we prevail. That means that every day of delay is more interest on the amounts at issue. With approximately 2500 in the class, we are talking about a lot of money.

Comcast Oregon cable TV late fee class action settlement update

This seven year old consumer class action case is coming into its final stages. The time to file claims ended. Next Monday, July 11, the money for fees and charitable contributions gets paid. A month later, August 11, 2011, consumers who made claims should begin to see credits on their bills for those who continue as Comcast subscribers and checks for those who are former subscribers.

Keep in mind that Comcast can dispute claims. We have not been notified that Comcast intends to do so. We continue to serve the class through the claims process in case there are any problems.

We’ll keep watching, of course. If you made a claim and do not receive your credit or check. Keep in mind that Comcast is entitled to off set unpaid balances.

Feel free to contact us if you have questions.

 

Hot Coffee, frivolous lawsuits and HBO

HBO premiers Hot Coffee, The Movie tonight. The documentary is Oregon attorney Susan Saladoff’s labor of love. Susan put aside her law practice to will this film into being. She is a force of nature.

Susan makes no bones about her point of view. Like me, she is an Oregon consumer-side attorney who represents injured Oregonians in tough cases. I’ve tracked her cases over the years–we’re buddies–and she is the real deal. Susan grew weary of the fog machine’s distortion of the civil justice system. So she set out to make a film to publicize some of the misconceptions of our system.

By all accounts, she had no real experience as a filmmaker. I imagine that many thought her to be a modern-day Quixote riding off to do battle with the menacing windmills. As with any audacious plan, there are many ways to fail. But she is a force, and her improbable work wound up at Sundance with great recognition.

The well-known McDonald’s hot coffee case serves as a starting point for her film. While everyone knows the McDonald’s case, Susan gets the evidence and shows why the jury correctly decided it and how the pro-corporate fog-machine turned it into a cause by totally misrepresenting the facts. After watching some of the early cuts of the film-in-progress, I was awed by how she brought the evidence to life. Once you see this movie, you will never think about the McDonald’s hot coffee case the same way again.

The corporate fog machine’s favorite catch phrase, “frivolous lawsuit,” is at issue here. It’s a bastardized meme, arising from the rules of civil procedure. It used to mean that a case had no legal or factual basis and that the lawyer pursuing the matter did so in bad faith. Now it has come to mean any case in which a consumer seeks justice for wrongs heaped upon them.

Corporate interests took aim at the civil justice system because our civil justice system provided the only means through which consumers and members of the middle class could hold wrongdoers accountable. In doing so, the frivolous lawsuit meme has nullified the Seventh Amendment right to trial by jury. The film is part of a growing movement to restore the Seventh Amendment and consumers’ access to the civil justice system.

I am planning to watch it tonight and planning to record it as well. Susan is a jewel for her commitment and her achievement. All of us who work in the trenches of the civil justice system are indebted to her.

Comcast Oregon late fee class action settlement receives final approval

On Monday, May 2, 2011, Multnomah County Circuit Court Judge Henry Kantor granted final approval to the class settlement entered between Comcast and Oregon consumers billed cable TV late fees. Under the terms of the settlement, Comcast pays $16 per late fee to claiming class members, up to $23 million, together with attorney fees and costs of $5 million, and a $75,000 charitable contribution split between the Oregon Food Bank and the United Way.

Class counsel decided to leverage the charitable giving by adding $100,000 from our fees to be divided between five groups that provide legal services to low and moderate Oregonians and national groups that advocate for consumers. The five non-profits that will split the legal team’s contribution are Oregon’s Campaign for Justice, St. Andrews Legal Clinic, Oregon Law Center (through the Campaign for Justice), National Consumer Law Center, and Public Justice Foundation. We’re really pleased to be able to make these contributions.

If you’re a consumer who was billed a late fee you need to file your claim before July 1. Here is the link to the claim form. Fill it out. If you paid one or two late fees, you only need to sign it and return it. If you paid more than two, you need to sign the claim form in front of a notary or provide documentation of how many late fees you paid.

Under Oregon law, unclaimed monies are returned to Comcast. So if you paid a cable TV late fee in the class period and you want to make a difference, it would be a good thing to make a claim.

As this thing winds to completion, it’s hard not to reflect on the ups and downs of a long (seven year!) case. It’s been a tough haul, but we knew it would be. In the end I am pleased with the outcome. It’s a big settlement, and a win for consumers. Those are rare, so we savor them.

If you’re class member and you have questions, feel free to contact me, as I will work with class members to make sure that you get your claim filed.

David Sugerman

Our own worst enemies-lawyer ads, solicitation letters and internet marketing

Via Twitter, the law blog world and a few local lists, I’ve spent the better part of a week thinking about lawyer advertising. First thing: I am biased. I believe that the law is a profession.  As such, our clients come first, the justice system next, and we come third.

The U.S. Supreme Court long ago said that truthful lawyer advertising is subject to First Amendment protection. There is good reason for that rule. But–and this may seem like heresy–too many believe that the inquiry ends there. The rights secured by the First Amendment are critically important. But so are the 5th amendment rights of equal protection, the 6th amendment rights of the accused, the 7th amendment right to trial by jury, and the 14th amendment right to a fair trial.

The problem is not advertising, but the content and methods that lawyers use to reach prospective clients. A recent discussion with a nameless younger lawyer highlights the problem. He proudly sends accident solicitation letters to Oregon drivers who have been in motor vehicle collisions. He defends the process by saying that he provides important information to consumers, that insurance companies will take advantage of unsophisticated consumers, and that he is sticking it to the man.

The same young attorney trumpets on his website his aggressive and hands-on approach to handling motor vehicle collisions. The same young attorney recently posted on a local list a question about motor vehicle collisions that revealed a stunning lack of mastery of the subject matter area.

In discussions about lawyer advertising, the one thing that lawyer advertising advocates invariably mention is that they have to make a living, too. Sometimes they add that we who criticize are really just trying to squelch competition because we got ours.

Whatever success I’ve had in building a law practice has come through years of hard work. It took me nearly a decade to attain basic mastery in the practice of law. I am in my 25th year of practice now. My particular areas of practice are such that some years I earn a lot of money, and some years I do not. There are simply no guarantees of fabulous income.

So there are a few things nagging at me here. The problem is the advertising lawyer who resort to ads that make you and me wince do not recognize any obligation to the justice system.

Here are some not-very-far-fetched examples. How about screaming, boosted volume TV ads: CALL 1-800 LETS SUE!!! Or how about the snake-oil peddlers who sell internet marketing for lawyers and then spam the firm web page across the internet. Or there’s the unsolicited letter mailed or emailed to people who have been in motor vehicle accidents about how “I can help you and/or your loved ones in this time of need” for a mere third of the recovery.

Don’t get me wrong. I see fabulous web pages out there. I know attorneys who provide great information about their practices and their areas of law by use of advertising. I see some of my colleagues’ use of media and think that they are doing great work. But none of them are racing to the bottom through the bad ads.

Invariably, those who are running in the race to the bottom use one or all of the following excuses: 1. “Everyone is doing it.” 2. “It’s perfectly legal.” 3. “I’m just trying to make a living.” The problem is that each one of these “legal” marketing approaches cheapens the justice system.

Trial lawyers wonder why the public holds them in low regard. Part of the answer comes from the work of very powerful and wealthy interests dedicated to making sure that consumers surrender their rights to trial by jury. If you’ve heard the phrases, “frivolous lawsuit,” or “lawsuit lottery,” you’ve been exposed to their handiwork.

And we who dare to represent consumers know this. We know it in our bones. Still the advertisers are so intent on getting theirs that they simply do not care. Because that’s what it’s about at the bottom: Getting theirs. So the mass marketers run ads to collect cases that they will never try and in doing so give the Cato Institute and various anti-consumer forces great material for their campaigns to lock consumers from our courthouses.

For those of us dedicated to the proposition that this is a profession, every bad, screaming ad, every invasive solicitation letter, every SEO spam comment is another nick in a badly damaged system of justice. Even so, those of us who dare to demand higher standards will not go quietly into the night.

 

Culinary schools face regulatory pressure

Here is the link to a recent NPR story regarding culinary schools and the disconnect between culinary careers and the costs of culinary school. Interesting quote from the of Career Education Corp. executive Kirk Bachmann about the calculations of placement rates. He notes that CEC schools do not include Starbucks barristas in their placement rates. As we say at the beginning of a deposition, “Swear the witness. I have a few questions.”

On a side note, Le Cordon Bleu Portland/Western Culinary Institute recently announced plans to drop its associates degree.  We’ll be interested in finding out more about that as well.

Meanwhile, our class action case continues forward against these defendants.  Cases like this are slow, but we are on track.