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Class Action Roundup – June 16, 2017

Tax Preparers Come Out Victorious in Class Action Lawsuit Against IRS

The Internal Revenue Service (IRS) is on the wrong end of a federal judge’s ruling that states the agency unlawfully charged at least 700,000 paid tax preparers unlawful license fees. The class action lawsuit loss will cost the IRS more than $175 million, Forbes writes.

The three-year class action sprung from the IRS’s attempts to regulate tax preparers, starting with a September 30, 2010 requirement that all paid tax preparers obtain a preparer tax identification number (PTIN). Forbes writes it wasn’t the mandatory fees themselves that were problematic, but rather the IRS’s heavy-handedness in what it charged tax preparers. In 2010, the initial fee for IRS tax preparers was $64.25, with an additional $63 renewal fee in effect every year after.

The class action argued the IRS had no authority to charge tax preparers fees that were not in exchange for a “service or thing of value.”

Writer Kelly Phillips Erb has the details of the result, as well as the court’s reasoning for ruling against the IRS, over at Forbes.com.

Supreme Court Sides with Microsoft in Xbox 360 Row, Denies Class Action

The United States Supreme Court this week unanimously sided with Microsoft by denying a lawsuit filed by some Xbox 360 owners the chance to proceed as a class action. Filed in 2012, the lawsuit, backed by 55,000 consumer complaints, claimed some Xbox 360 consoles contained a defect that could damage discs during normal use. When a federal judge ruled the case could not go forward as a bona fide class action, plaintiffs asked to voluntarily dismiss the case, a strategic move meant to get an appeals court to take a look at the lawsuit.

Microsoft threw a penalty flag and argued against this maneuver. In what Ars Technica calls a “highly nuanced” decision, the Supreme Court ruled proposed class members could not appeal a lower court’s decision denying the case class action status because there was never a final ruling by a trial judge. As a result, individuals who have a beef over the alleged Xbox 360 defect can only sue Microsoft individually, at least for the time being.

Ars Technica senior editor David Kravets has everything you need to know on the ruling.

Here’s Why that Overtime Pay Class Action Against Chipotle Matters

Hundreds of class actions filed over allegedly unpaid overtime wages have come across our desks since ClassAction.org’s Newswire opened for business back in October 2016. One filed in U.S. District Court in New Jersey this week, however, perked our ears up a little higher than usual.

The lawsuit alleges Chipotle owes time-and-a-half hourly overtime wages to employees who work more than 40 hours per week and make less than $47,476 annually under a federal rule that would expand overtime pay to millions of additional workers—even though an injunction passed in late 2016 banned the Department of Labor from enforcing the provision. The workers’ counsel claims despite the injunction, the rule was technically in effect as of December 1 because a final decision or repeal has yet to be issued.

At issue, the Chicago Tribune writes, is that the labor rule, finalized under the Obama administration, would more than double the income threshold deeming workers eligible for overtime pay and could impact millions of other workers nationwide.

Head over to Jonnelle Marte’s piece at ChicagoTribune.com to read more on the lawsuit and its potentially expansive consequences.

Jessica Alba’s Honest Co Settles Labeling Lawsuit in NY for Undisclosed Amount

(Ed. Note: Look, all the good puns to be made out of the company’s name have already been made by other media outlets, so we’ll stick to just the facts.)

A lawsuit filed against Honest Co, an e-commerce site co-founded by actress Jessica Alba, in New York over claims that it misleadingly labeled certain home and personal care products as “natural” has been settled for an undisclosed amount. The deal, Reuters reports, comes a week after Honest Co settled a federal lawsuit in Los Angeles for $1.55 million. That case alleged the company sold laundry detergent, dish soap and surface cleaners that contained a skin irritant it promised to keep out of its products.

The plaintiff in the New York lawsuit named 41 specific Honest Co products that he claimed were deceptively marketed and labeled as having all natural ingredients.

Reuters reporter Jonathan Stempel has the full breakdown.

Injured Rider’s Class Action Goes All-in on SoulCycle

SoulCycle, parent company Equinox Holdings, Inc., and instructor Angela Davis are the defendants in a proposed class action lawsuit filed on May 31 in Los Angeles by a rider who claims multiple factors caused her physical and mental pain and suffering.

Hollywood Reporter, citing “lack of instruction, design of the bike, volume of the music and darkness of the room,” writes the plaintiff claims she was never showed how one of SoulCycle’s bikes worked before being thrown head-first into her first ride, which reportedly took place in a room “cased into a shadowy darkness.” Further, the plaintiff alleges she heard instructors mocking other riders who seemingly couldn’t keep pace with the rest of the class, and was even scorned herself when she got tired and tried to stop pedaling.

“Fatigue and disorientation overcame [the plaintiff] and she fell to the right and off of the saddle of the spinning cycle,” according to the complaint. Though she was now half-off the cycle, the complaint continues, her “left and right foot remained locked to the pedals.”

Still can’t paint the disturbing picture in your head? Hollywood Reporter adds from the complaint:

“The momentum of the flywheel kept the pedals turning and her left ankle was repeatedly dislocated, [the plaintiff] claims, leaving her ‘catastrophically injured.’”

The plaintiff alleges, at the core of her case, SoulCycle and instructor defendant Davis failed to follow the company’s own policies and procedures, which reportedly mandate a 15-minute introduction to spinning and a primer on safety.

Yeah, this one is a doozy. Hollywood Reporter’s Ashley Cullins can bring you up to speed over at the publication’s website.

Dish Network Will Pay $280M for Placing “Millions and Millions” of Robocalls

Satellite cable provider Dish Network has been ordered by a federal judge in Illinois to pay $280 million in fines over allegations the company and its contractors placed “millions and millions” of unwanted telemarketing robocalls to numbers included in the national Do Not Call registry. Dish will pay $168 million to the federal government and $112 million to four states. According to U.S. District Judge Sue Myerscough, whose ruling was 475 pages long, the penalty—possibly the largest monetary fine ever in a robocall lawsuit—represents about one-fifth of Dish’s after-tax revenue for 2016.

In a statement to Reuters, Dish Network said it “respectfully disagrees” with Judge Myerscough’s ruling, adding that it plans to appeal.

Reuters’s David Shepardson and Anjali Athavaley have the full report

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