.................with apologies to Alistair Cook

Sunday, 3 May 2009

Bluetooth Phone Headset Makers in Class Action Lawsuit - Give Me a Break

Bluetooth Phone Headset Makers in Class Action Lawsuit- Give Me a Break: "

headset-lawsuit-noticeHave you ever received a letter notifying you that you are involved in a class action lawsuit and that your rights may be affected? Usually it involves the fact that you purchased something from a list of companies who have been sued and that a proposed settlement has been made that will determine what your damages will be. I got one of these letters yesterday that involves a suit against Motorola, Plantronics and Jabra concerning Bluetooth headsets they sold. The suit was filed because these companies did not warn consumers of a ‘risk of hearing loss and that Defendants acted wrongfully when they did not warn consumers of the risk (if it exists).’

I had to read that part twice, they are being sued because they didn’t warn about a risk that might not exist. That’s what it says and that’s what it means. Can you say frivolous lawsuit? I knew you could. This is what is wrong with this system in the US. Why bring a class action suit like this in the first place?  The answer is money. Millions of dollars are being pursued from these big, bad companies and all under the guise of trying to protect us, the unknowing public.

Don’t get me wrong, I am not railing against the ability to take recourse against companies that wrong us as consumers. It is important that we have an avenue of redressing wrongs. I am no legal expert but from all that I’ve seen of these class action suits I can’t say I have ever seen any consumer get fairly represented when the redressing takes place. It seems to me only the lawyers involved get any redressing and they deserve it, you can never have enough Armani suits.

This becomes glaringly obvious when you read through the aforementioned document above. The defendants in the suit ‘deny their Bluetooth headsets are unsafe or that they did anything wrong. Defendants are settling only to avoid the risk and expense of trial.’ In other words the law firms representing you and I bullied these companies into accepting a class action settlement to keep their potential risk as small as possible. This is how class action suits work and what is wrong with them.

If my best interests are being served by those who brought this class action suit against these companies what does this settlement mean for me and the other millions who bought headsets? Nothing it turns out.

‘It is not practical or economical to provide benefits directly to individual Class Members because the Class is very large and the amount each Class Member would receive is very small. Therefore, the Class Representative, the attorneys for the Class, and the Defendants agree that the cost of distributing any kind of benefit directly to Class Members would consume too much of the Porposed Settlement benefits. Instead, they believe that providing funding to non-profit organizations that focus on preventing hearing loss will indirectly benefit all Class Members’.

In other words there are too many of us consumers so we wouldn’t get much anyway.  That’s the reason for the part of the settlement that ‘will donate $100,000 to one or more non-profit organizations that focus on preventing hearing loss.’  This sounds like a drop in the bucket to me but a brilliant strategy because who among us can complain about a law suit that gives part of the settlement to charity?

The full settlement agreement shows the real purpose behind this (and many) class action lawsuits.  In addition to the $100k generously donated to several charities the proposed settlement will pay this:

Class Counsel will ask the court for up to $800,000 in attorneys’ fees and up to $38,000 for reimbursement of documented expenses.  Class Counsel will also request up to $12,000 total for the Class Representatives, who helped the lawyers on behalf of the whole Class.  The Court may award less than these amounts.  Defendants will separately pay the fees and expenses the Court orders.  These payments will not reduce the amount Defendants will donate to charity.

Defendants will also separately pay the costs to provide notice to the Class and administer the Proposed Settlement, up to $1.2 million.  If those costs are less than $1.2 million, Class Counsel may request reimbursement for additional documented expenses up to $12,000, which Defendants will pay upon approval by the Court.

It’s easy to see where the money will really go and who gets it- the law firms working in our best interests. No doubt the ultimate take will be in excess of $2 million as evidenced by these documents and what is really going on. To recap, the aggrieved parties (us) get nothing, a charity gets a pittance and the seven law firms handling the suit get a few million bucks. Sounds fair to me.

I win as a consumer in this suit because my best interests are being looked after. When I buy a Bluetooth headset in the future there will no doubt be a sticker on the box warning me that if I keep the volume too high I risk my hearing. That’s a big win for me. I am consumer hear me roar.


(Via jkOnTheRun.)