18th Annual Workplace Class Action Report - 2022 Edition

Annual Workplace Class Action Litigation Report: 2022 Edition 525 also determined that Plaintiffs’ claims were typical of the claims asserted on behalf of the class members, as they all executed materially identical to the form agreements, and all sought monetary damages against Defendants for the same claims and based on the same alleged injuries. The Court further held that Plaintiffs and Plaintiffs’ counsel met the adequacy requirement. As to the Rule 23(b) requirements, the Court opined that common issues predominated because Plaintiffs and every class member suffered the same type of alleged injury, i.e. , the deprivation of the loan principal invested toward the Harbourside Project and deprivation of their membership rights in the developer following Defendants’ improper exercise of the EB-5 Loan Agreement conversion clause. Id . at *23. Finally, Plaintiffs argued that the superiority requirement had been satisfied because class certification would promote the preservation of judicial resources, the core liability inquiries arose from the same uniform documents that were entered into by all class members, and granting class certification would not hinder the Court’s management of the case. The Court agreed that a class action would be the superior method of adjudication. For these reasons, the Court granted Plaintiffs’ motion for class certification. Plavin, et al. v. Group Health Inc., 2021 U.S. App. LEXIS 15189 (3d Cir. May 21, 2021). Plaintiff, a government employee and participant in Group Health Incorporated’s (“GHI”) Comprehensive Benefits Plan (“the Plan”), filed a class action alleging that GHI made misleading statements about reimbursement for out-of- network services under the Plan in violation of New York’s General Business Law (“GBL”) and Insurance Law and for unjust enrichment. The District Court previously had granted Defendant’s motion to dismiss. On appeal, the Third Circuit vacated and remanded the District Court’s ruling. New York City offered its employees and retirees eleven health insurance plans, including the Plan. The City paid for the Plan, and members did not pay out-of-pocket premiums. GHI also provided coverage for non-participating providers and reimbursement for these services was made "under the NYC Non-Participating Provider Schedule of Allowable Charges (Schedule)." Id . at *2. The Summary of Benefits & Coverage provided coverage examples, but also stated that the examples were only estimates and that costs will be different. Id . at *3. GHI also offered an "Optional Rider" and catastrophic coverage, which stated "Enhanced schedule for certain services increases the reimbursement of the basic program’s non-participating provider fee schedule, on average, by 75%." Id . Under the Plan, participants were eligible for "catastrophic coverage" if they "choose non-participating providers for predominantly in-hospital care and incur $1,500 or more in covered expenses." Id . Plaintiff’s wife received medical services in 2013 and 2014 that GHI deemed out-of-network. Plaintiff contended that based on GHI’s marketing materials, he thought that he would be reimbursed for a higher percentage of these services, but only received a slight reimbursement. Plaintiff contended that the: (i) the coverage examples were deceptive; (ii) the description of the Schedule was deceptive; (iii) GHI’s statement that reimbursement amounts "may be less" than the fee charged when in fact they would always be less: (iv) the optional rider description did not disclose that it excluded all out-patient out-of-network services; and (v) the description of catastrophic coverage was deceptive because the coverage was not actually additional. The Third Circuit held that Plaintiff adequately pleaded materially misleading statements and that the materials portrayed a misleading picture of the Plan’s out-of- network benefits. Thus, the Third Circuit determined that the District Court erred in dismissing the GBL claims at this stage, especially given the fact-based reasonableness standard. Finally, since the parties did not submit the contract to the District Court, it could not have determined whether the contract governed the subject-matter of the dispute and therefore it was premature to dismiss the unjust enrichment claim because of this contract. Accordingly, the Third Circuit vacated and remanded the District Court’s ruling for further proceedings. Van, et al. v. LLR, Inc., 2021 U.S. Dist. LEXIS 176071 (D. Alaska Sept. 16, 2021). Plaintiffs, a group of consumers, filed a class action alleging that Defendant, a multi-level marketing clothing company, engaged in sales practices that violated the Alaska Unfair Trade Practices and Consumer Protection Act (“UTPCPA”) due to incorrectly applied sales tax to transactions. Plaintiffs filed a motion for class certification pursuant to Rule 23, and the Court granted the motion. Plaintiffs asserted that Defendant’s point of sale system incorrectly charged sales tax to consumers in Alaska, where no sales tax is assessed. Plaintiffs sought class certification of a class consisting of “all persons who were assessed tax on purchases of LuLaRoe products and whose purchases were delivered into a location in Alaska that does not assess a sales or use tax on the clothing that LuLaRoe sells.” Id . at *11. The Court determined that the class consisted of approximately 10,369 potential class members, and therefore was sufficiently numerous. As to the commonality requirement, the Court found that Plaintiff and the proposed class members were all customers of Defendant’s retailers who lived in jurisdictions that did not impose a sales tax and who were billed for a sales tax based on Defendant’s point of sale system,