Whistleblower Protection Provided Under SEC Law Federal law mandates that, if a company is publicly traded, they must report earnings and other financial information to the Securities Exchange Commission (SEC).  In 2002, the Sarbanes-Oxley Act was enacted in response to an increase in the mishandling of required SEC filings and corporate fraud. The legislation afforded employee whistleblower protection and helped the SEC further regulate corporations. The Act also made retaliation against a whistleblower a crime, for which the employer can be prosecuted.... Read More

What is a Section 327 Appointment?   According to Section 327(a) of the Bankruptcy Code, a Section 327 appointment involves an attorney appointed by a bankruptcy trustee to assist in a Chapter 7, 11 and 13 bankruptcy proceeding.  Special counsel appointed in this capacity must first sign a sworn affidavit that they do not represent any materially adverse interest to the estate and is not an interested party.  Special Counsel in a Section 327 appointment is also prohibited from assisting the trustee in... Read More

Employee Lawsuits May Proceed Under PAGA California and federal laws generally uphold arbitration waivers in employment agreements signed by an employees.  These arbitration agreements often prevent employee lawsuits should a dispute arise regarding wages or other workplace conditions. In Iskanian v. CLS Transportation Los Angeles, LLC, however, the California Supreme Court entertained the issue of whether an arbitration agreement containing a waiver for class actions also applies to a disgruntled employee bringing or participating in a representative claim under the Private Attorneys General Act ("PAGA"). What... Read More

Unsolicited Phone Calls Continue to Run Afoul of the Telephone Consumer Protection Act In an effort to curb unscrupulous solicitors and telemarketers, the federal government passed the Telephone Consumer Protection Act ("TCPA") in 1991. The TCPA allows a member of the public to file a lawsuit and collect damages for receiving unsolicited phone calls, faxes, text messages, pre-recorded calls or autodialed calls. The TCPA imposes severe monetary penalties on companies if they violate the provisions of the Act. Courts will award a minimum of... Read More

What is a Whistleblower? A whistleblower is a person, usually an employee, who reports the illegal practices or misconduct of an individual, company or even a government contractor. There can be both internal and external whistleblowers. For example, an employee could report the misconduct of a co-worker to their supervisor or they could report the company to an outside entity, such as the media, a watchdog organization or a government agency. It is important to note that a whistleblower must reasonably believe... Read More

Class Action Lawsuits   Class action lawsuits are brought when a sizable number of people (the "class") suffer similar injuries due to the actions of a particular defendant, usually a company. In order to proceed as a class action, however, certain criteria must be met. “Certification” is the process by which a judge will decide if a class action is appropriate. Generally, a case will be “certified” if there are similar legal or factual issues and the class is large enough to make... Read More

Audet & Partners, LLP reports that a New York consumer has launched a class action lawsuit in the U.S. District Court for the Southern District of New York against Rite Aid Corp. alleging violations of the Telephone Consumer Protection Act ("TCPA").  In the lawsuit seeking class action certification, lead plaintiff Robert Zani has alleged that Rite Aid placed pre-recorded, unauthorized calls to the cell phones a nationwide class of consumers seeking to market its products and services including flu shots. Under the... Read More

Audet & Partners, LLP reports that Wells Fargo NA has agreed to pay $14.5 million to settle class action claims that the bank illegally called customers on their cell phones in the process of debt collection.  Lead plaintiff Lillian Franklin had brought the lawsuit against Wells Fargo in August 2014 alleging violations of the Telephone Consumer Protection Act ("TCPA"). The lawsuit, filed in the U.S. District Court for the Southern District of California claimed that Wells Fargo had repeatedly dialed the... Read More

Audet & Partners, LLP reports that C.R. Bard, Inc., a major transvaginal mesh manufacturer  and defendant in transvaginal mesh lawsuits, has argued against consolidation of the mesh litigation.  In a West Virginia federal court, Bard argued against consolidation in multidistrict litigation (MDL) fearing that such consolidation would paint a picture among juries that "something must be wrong" with Bard's pelvic mesh product. Arguing in favor of consolidation, attorneys representing women injured by transvaginal mesh implants have argued that consolidating the page... Read More

Audet & Partners, LLP reports that the U.S. Securities and Exchange Commission ("SEC") has released its report on whistleblower complaints for Fiscal Year 2014 which ended on September 30, 2014.  The Report stated that the SEC received 3,620 tips from whistleblowers in 2014, an increase from 3,238 in fiscal 2013. Perhaps most interesting is the growth in whistleblower complaints reported from outside the United States including 70 tips from the United Kingdom (up 6% from 2013), 69 tips from India (up... Read More

Audet & Partners, LLP has obtained a favorable ruling against Apple in a lawsuit claiming that Apple violated federal law by intercepting text messages sent to former iMessage users who switched to Android or other non-Apple devices.  In the U.S. District Court for the Northern District of California, Judge Lucy Koh denied Apple's Motion to Dismiss claims alleging violations of the federal Wiretap Act.  In so doing, Judge Koh held that although iMessage users may have given consent for Apple... Read More

Audet & Partners, LLP reports that a number of major financial institutions have been sued based on allegations that they illegally conspired to artificially inflate the price of silver.  Deutsche Bank AG, Bank of Nova Scotia, and HSBC Plc are alleged by experienced commodities traders to have colluded to fix the price of silver futures to ensure high returns as part of the London Silver Market Fixing Ltd.  The London Market has fixed the price of physical silver since 1897.... Read More

Audet & Partners, LLP reports that the U.S. Food and Drug Administration (FDA) has issued new formal guidelines that are intended to clarify whether certain changes to marketed medical devices constitute a "recall" or "product enhancement."  This distinction is important to medical device manufacturers and marketers as "recalls" trigger specific reporting requirements with the FDA, while "product improvements" need not be reported to the FDA. The key element of guidance provided by the FDA concerns whether the product change includes "a... Read More

Audet & Partners, LLP reports that a recent ruling by the Ninth Circuit Court of Appeals holding truck drivers to be employees rather than independent contractors of Affinity Logistics Corp. has been appealed to the U.S Supreme Court.  In June, the Ninth Circuit held that delivery drivers had been improperly classified by Affinity as independent contractors based primarily on the degree of control that Affinity maintained over the drivers' working conditions. The Affinity case was originally filed in 2005 by Fernando... Read More

A federal court in California has looked to the Federal Arbitration Act in upholding mandatory arbitration agreements as a bar to employment claims under the California Private Attorneys General Act (PAGA). Sitting in the U.S. District Court for the Central District of California, U.S. District Judge Jesus Bernal granted a Motion to Compel Arbitration brought by defendant 20/20 Communications, Inc. In so doing the court rejected arguments advanced by plaintiffs that pursuant to the California Supreme Court decision in Iskanian v.... Read More

Audet & Partners, LLP reports that a new opinion issued by a California appellate court has revived employment claims brought by a workers under the California Private Attorneys General Act ("PAGA") despite the fact that the worker had signed a mandatory arbitration agreement in connection with her employment.  Reyna Marie Ybarra v. Apartment and Investment Management Co., case number B245901, in the Court of Appeal of the State of California, Second Appellate District. Ms. Ybarra had brought a lawsuit in California in... Read More

Audet & Partners, LLP reports that Gov. Jerry Brown of California has signed into law Assembly Bill 1897 that now makes most companies with 25 or more employees strictly liable for specific violations related to compensation, workers' compensation, and occupational health and safety mandates that impact contractors. The new California law, to become effective on January 1, 2015,  protects contractors by imposing statutory liability on companies in the following general areas: • Payment of wages to the contractor's employees; • A contractor's failure... Read More

Within California, an extensive list of employment-related legal violations may be pursued by individuals acting as "proxies" for the California Attorney General in ensuring safe and fair working conditions.  Under this Private Attorneys General Act, or PAGA, the state has set up specific procedures for pursuing these violations, as well as specific penalties to remedy and discouraging these violations. For many years now in California, however, employers have included arbitration agreements as conditions for employment which have been held to effectively... Read More

In an effort to buttress profits similar to hidden charges imposed by airlines for several years, hotels and resorts are increasingly imposing add-on and use fees to customary rates.  These charges may be for "resort fees," charges for mini-bar or in-room snacks, and the like. to the extent that such charges are not clearly transparent to the consumer, the establishment may run afoul of the law and become subject to class action lawsuits by aggrieved consumers. For example, when offering a... Read More

Audet & Partners, LLP has learned that the Securities and Exchange Commission is poised to pay out around $30 million to an individual who called ongoing fraud to the government's attention.  The fraud in question apparently involved illegal investment-related activity that defrauded investors of millions of dollars.  In a formal Order, the SEC stated that the whistleblower award would have been  more sizable had the informant reported the illegal activity sooner and that the delay in relating information to the government... Read More