Duane Morris Class Action Review - 2023 - Report - Page 296
to assert any claims against the other party as a representative or member in any class
representative action.” Id. at *4. The defendants contended that the provisions required
striking the plaintiffs’ class allegations before the plaintiffs filed a motion for class
certification. The plaintiffs asserted that they sufficiently alleged that the MCA
agreements were void in their entirety, and thus the class action waivers could not be
enforced. The court explained that as applied here, the theory of RICO liability requires
demonstrating that the MCA agreements are “unenforceable . . . in whole or in part”
under New York's usury laws, which states that “criminal usury” involves making and
collecting on loans at a greater than 25% interest rate. Id. at *6. The plaintiffs alleged
that the effective interest rates charged by the MCA agreements were over 50%. Thus,
the court determined that the plaintiffs adequately alleged that the MCA agreements
operated as and would be considered usurious loans under New York law. Therefore,
the court opined that New York law would consider the agreements void, including the
class action waiver. The court reasoned that if it were to grant the defendants the relief
requested, it would necessarily have to enforce against the plaintiffs a provision in an
allegedly void contract before any determination as to the validity of that contract had
been made Id. at *16. The court therefore declined to strike the plaintiffs’ class
allegations.
In Rosenfeld, et al. v. Talamantes, 2022 U.S. Dist. LEXIS 195869, (C.D. Cal. Aug. 10,
2022), the plaintiffs, the parents of Scott Rosenfeld (the decedent), an individual who
died in detention after he suffered from heart, lung, and liver failure, filed a class action
alleging constitutional violations and for violation of the RICO. The defendants filed a
motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6) and to strike the
class claims, and the court granted the motion. The court found that the plaintiffs failed
to plausibly allege a specific injury to their business or property resulting in concrete
financial loss, as required to establish an injury under the RICO. The plaintiffs
contended that the defendants caused the concrete financial loss of the plaintiffs having
to pay for the funeral expenses of their deceased son, the financial loss of the cost of a
forensic pathologist to examine their son’s remains, the cost and expense of having to
investigate their son’s death, and the cost of legal representation to vindicate and
compensate for their son’s death. Id. at *16-17. The Court ruled that even assuming the
plaintiffs’ allegations plausibly pled an injury, the injury was not cognizable under the
RICO. The court explained that the Ninth Circuit has clarified that when financial loss is
a mere “downstream effect” of the original injury and “not an independent harm itself,”
that loss does not support RICO standing. Id. at *17. The court reasoned that in this
matter, the plaintiffs alleged specific expenses they incurred “to vindicate and
compensate for” the decedent’s death, but those expenses are all “downstream effects”
of the alleged constitutional violations, and were not independent injuries. Id. For these
reasons, the court granted the defendants’ motion to dismiss the plaintiffs’ RICO claim.
The Court also dismissed the class claims, finding that Plaintiffs failed to meet any of
the requirements of Rule 23.
In Zantac (Ranitidine) Products Liability Litigation Plumbers & Pipefitters Local Union
630 Welfare Fund, et al. v. Glaxosmithkline LLC, 2022 U.S. App. LEXIS 30823 (11th
Cir. Nov. 7, 2022), the plaintiffs, the Plumbers & Pipefitters Local Union 630, the NECAIBEW Welfare Trust Fund, and the Indiana Laborers Welfare Fund, filed a class action
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Duane Morris Class Action Review – 2023
