O'Bannon Case Ordered To Mediation

Last week, Judge Claudia Wilken referred the pending O’Bannon lawsuit to Magistrate Judge Nathanael Cousins for "a settlement conference to be held as soon as it is convenient."

The mediation is to involve issues raised by a group of class-action and individual anti-trust plaintiffs led by former UCLA basketball player Ed O'Bannon, as well as those raised by former Arizona State and Nebraska football player Sam Keller.

The Keller case is a presumptive class action relating to the use of college athletes' names and likenesses in video games.

In the O'Bannon case, the plaintiffs, on a class-action basis, are seeking an injunction that would bar the NCAA from limiting what Division I men's basketball players and football players can get for participating in their respective sports. Individual named plaintiffs also are seeking a jury verdict — and damages — relating to the alleged misuse of their names and likenesses in the past.

The O'Bannon plaintiffs and the NCAA had each asked Wilken to decide the case in their favor without a trial. As covered in my blog previously, Wilken said she would not grant a full summary judgment to either side, and she set a June 9th trial date. However, she has not yet made a formal ruling on the summary judgment requests, or a series of other pending matters. She did state that at least some of the issues will go to trial.

Jon Solomon, who writes for The Birmingham News/al.com, has written another excellent piece on the story. He has covered the lawsuit for the last few years and I have put links to his articles on my blog many times. For more on his take, click on the link below:

http://www.al.com/sports/index.ssf/2014/02/judge_orders_settlement_talks.html

RECENT ALABAMA APPELLATE OPINIONS

In Health Care Authority for Baptist Health v. Davis, No. 1090084 (Ala. Feb. 28, 2014), the Alabama Supreme Court reversed course and, upon reconsideration, determined that a private hospital which entered into an agreement with UAB or the University of Alabama to manage the facility with the private entity regaining possession of the property upon termination of the agreement did not enjoy sovereign immunity. 

The gist of the analysis was that a franchise was created, as opposed to the hospital becoming an agency or arm of the state.  One gets the sense that the hospital could only become a state agency or entity if a state agency fully purchased the hospital and renamed the facility, for example, as UAB-Montgomery. 

Additionally, the Supreme Court held the $100,000 cap applicable to municipalities and counties could not be constitutionally extended to the HCA which was not created by municipalities or counties.

JPMorgan Chase Settles Force-Placed Insurance Class Action Lawsuit

A class action lawsuit against JPMorgan Chase over force-placed insurance practices has reportedly settled. The case is pending in Miami, Florida before Chief Judge Federico A. Moreno of the United States District Court for the Southern District of Florida. Although Chase entered into the settlement agreement in September 2013, the final approval hearing before Judge Moreno is scheduled for February 14, 2014.

The settlement could pay more than $300 million to about 750,000 mortgage borrowers. The plaintiffs have also entered into a separate settlement for $4.75 million with Chase relating to forced-placed insurance for policies covering wind damage. The $300 million settlement relates to polices that cover fire and other risk.

The settlement does more than extract money damages from the behemoth bank, it also achieved injunctive relief. The national settlement prohibits the bank for six years from getting commissions, kickbacks or reinsurance from the insurance, which it obtains when a homeowner's policy lapses. This is known colloquially as “inflating premiums”. The estimated value of injunctive relief from the bank changing its practices is thought to be $690 million.

Class members can file claims to recover part of the premiums they were charged between 2008 and Oct. 4, 2013.

Premiums for force-placed insurance, which were deducted from a homeowner's escrow account or added to the mortgage loan balance, were often much higher than the homeowners' initial premiums. Many of those covered by the lawsuit lost their homes to foreclosure.

Chase unsuccessfully sought to dismiss the lawsuit this past May, claiming that the contracts granted the lender substantial discretion in placing coverage and that the plaintiffs did not dispute that they breached their mortgage agreements by failing to maintain continuous coverage.

From the period of 2008 to the present, the homeowners alleged that Chase force-placed more than $2.3 billion in insurance coverage, netting Chase approximately $600 million. The settlement requires that Chase refund 12.5 percent of the annual premiums for forced-placed policies to all class-members, and that it refrain from inflating premiums for six years.

This class action lawsuit against Chase and Assurant is not the first large-scale litigation over forced-placed insurance. Earlier this year, Wells Fargo and QBE Insurance Group Ltd. announced that they agreed to settle a similar claim, also pending in Miami before U.S. District Judge Robert Scola, for $19.3 million in favor of 30,000 borrowers.

Similar settlements are expected to follow in lawsuits against some other major banks.