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Class Action Clash in Receipts Cases

Posted Aug 27, 2007 8:03 AM CDT
By Debra Cassens Weiss

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Plaintiffs lawyers bringing class action lawsuits against companies for financial privacy violations are running into a roadblock, and his name is U.S. District Judge John Walter.

The suits claim the companies printed too much credit card information on receipts in violation of the federal Fair Credit Reporting Act, the Recorder reports. Damages can be as high as $1,000 for every improper printout.

Walter is one of several judges who have refused to certify nationwide class actions in such cases, prompting plaintiffs lawyers to seek class action status for more limited numbers of plaintiffs, the legal newspaper says.

Walter refused to certify a nationwide class action against Cost Plus in May on the ground that the minimum statutory damages of $340 million would exceed the company’s net worth and put it out of business. As a result, a class action was not a superior method for resolving claims, he said.

But the Los Angeles federal judge wasn’t satisfied with efforts to limit a class action against U-Haul to customers who rented vehicles in four California cities. On Aug. 15, he said minimum damages in the more limited action would still amount to around $115 million, about equal to the company’s net worth. He also said the smaller class would leave the company open to “piecemeal litigation” and cause disparate treatment of consumers.

Farris Ain, a Claremont, Calif., lawyer who represents plaintiffs in the U-Haul case, is representing plaintiffs in about 30 lawsuits brought under the law. He expects rulings next month on class action requests against Adidas, MGM Grand, Costco and other companies.

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