Class Action & MDL Roundup – Spring 2021 – Litigation, Mediation & Arbitration
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The numerous class actions filed in the wake of the COVID-19 pandemic continue to make their way through the courts. In this section, we highlight some of those recent decisions and provide updates on some of the trends that have developed.
Employee warns COVID is not a natural disaster
Benson v. Enterprise Holdings Inc., et al., n ° 6: 20-cv-00891 (MD Fla.) (January 4, 2021). Judge Dalton.
Justice Dalton dismissed Enterprise’s motion to dismiss a class action lawsuit brought by rental car workers claiming Enterprise violated Worker Adjustment and Retraining Notification (WARN) law by “dismissing them with little or no notice “due to the COVID-19 pandemic. The court dismissed the company’s defense on the basis of the WARN Act’s notice exception, which exempts employers from the notice requirement if a “collective dismissal is the direct result of a natural disaster.” Instead, COVID-19 caused changes in travel habits and an economic downturn, which affected defendants, so the defense against natural disasters does not apply. Dalton J. found that the “exception for unforeseeable business circumstances” was “the appropriate objective”. Since this exception to the WARN law does not completely exempt employers but only relaxes the notice requirement, Enterprise employees have filed a complaint for breach of the WARN law sufficient to survive the motion to dismiss.
Higher education class actions and COVID: courts split on tuition reimbursement cases
v. Pace University, # 1: 20-cv-03210;
Action to reimburse tuition fees in Colombia, n ° 1: 20-cv-03208 (SDNY) (February 26, 2021). Judge Furman.
Courts across the country continue to grapple with the dozens of class actions filed against colleges and universities over their switch to online education in the wake of the COVID-19 pandemic. Although many courts have granted dismissal requests filed by higher education institutions, some courts have allowed student complaints to be dealt with.
Generally speaking, the courts which dismissed these cases on the basis of the pleadings have done so when the claims for reimbursement of tuition fees were based on general allegations that the tuition and fees had been paid in assuming that in-person instruction would take place. In the absence of specific promises from a college or university that classes would be delivered in person, courts have generally granted the defendants’ motions.
Some courts, however, have denied the dismissal, in part or in full. For example, Judge Furman dismissed Pace University’s motion to dismiss the student-plaintiffs’ contractual claim for instructional format services because the university allegedly promised on its course registration portal that courses on the campus would be taught in person. In contrast, Judge Furman rejected the Columbia students’ teaching format contract request because they were unable to report a specific in-person teaching promise made by the school and the waves “Campus Experience” marketing statements were insufficient to substantiate a claim. The Pace and Columbia students also alleged that they paid a mandatory fee for the semester to use campus facilities and participate in campus activities and that those fees were not reimbursed. Based on these allegations, Judge Furman denied attempts by the two institutions to dismiss the contractual claims based on the availability of campus facilities and activities.
Conditions of Carry Airline Cases
Idé, et al. vs. British Airways PLC, # 1: 20-cv-03542 (SDNY) (Mar 26, 2021); Bombin v. Southwest Airlines Co., # 5: 20-cv-01883 (ED Penn.) (Mar 29, 2021); Rudolph, et al. vs. United Airlines Holding Inc., et al., n ° 1: 20-cv-02142 (ND Ill.) (February 12, 2021); Fensterer v. Capital One Bank (United States), NA, # 1: 20-cv-05558 (DNJ) (March 5, 2021).
In recent decisions on airline ticket reimbursement lawsuits, the courts have continued to consider the conditions of carriage to prevail. Ide c. British Airways ruled that the general conditions of carriage, which allow customers to choose one of the three remedies, apply to all customers, and Bombin v. Southwest ruled that the plaintiff has asserted a valid breach of contract claim based on the failure to function as a scheduled clause in the contract of carriage, which allows for refunds. The courts have also rejected force majeure arguments in the context of airline ticket reimbursement cases. The judge in Rudolph v. United Airlines dismissed the defendants’ motion to dismiss in part because, under the contract of carriage, the cancellation of the flight in question constituted a schedule change or an irregular operation and not a case of force majeure.
Regular round of layoffs for PPP officers
M&M Consulting Group LLC v. JP Morgan Bank NA, et al., No. 8:20 cv-01318 (CD Cal.) (Jan 6, 2021). Judge Selna.
The Central District of California continued the consistent trend in federal courts to dismiss agent fee claims under the Paycheck Protection Program (PPP). The plaintiff alleged that the defendant banks did not pay the fees to the agents who helped small businesses acquire federal loans under the P3. The court ruled that “in the absence of an agreement between the agent and the lender … lenders are not required to pay agent fees under the text of the CARES Act or its regulations. application “.
Coronavirus vaccine case survives dismissal
McDermid v. Inovio Pharmaceuticals Inc., n ° 2: 20-cv-01402 (ED Pa.) (February 16, 2021). Justice Pappert. Rejection of the motion for dismissal.
While many coronavirus securities class actions alleging falsity based on statements expressing a positive outlook despite the pandemic have struggled to survive the motions to dismiss, the plaintiffs won at the hearing stage when the court dismissed the defendant’s motion to dismiss. The plaintiff alleged that the company manipulated its share price by exaggerating its ability to create a vaccine against the coronavirus. The company has said publicly that it “built” a vaccine in three hours, while it “designed” only one vaccine in that time. The court concluded that the plaintiff had sufficiently pleaded causation of the losses and an inference of scienter and that the statements were misleading. The result gives plaintiffs a model for success in the otherwise unsuccessful arena of pandemic title claims.
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