A New York bankruptcy court will reportedly allow Chemtura Corp. to resolve 90 percent of the respiratory disease claims pending against it for $50 million, or one-third of the $150 million sought by factory workers allegedly exposed to the popcorn-flavoring ingredient diacetyl. In re: Chemtura Corp., No. 09-11233 (S.D.N.Y., settlement approved August 23, 2010). Responding to claims by co-defendants that the settlement may not meet “good faith” requirements, the court reportedly indicated that it was “within the range of reasonableness.” The settlement will apparently resolve 15 lawsuits and 347 proofs of claim filed by individuals alleging personal injury from diacetyl exposure. The company has indicated that eight additional individual and five corporate diacetyl claims remain pending. According to a news source, the company has also reached an agreement with its insurers to cover half the cost of the settlement and provide up to a maximum of $10 million to indemnify…
Category Archives 2nd Circuit
Renowned restaurateurs Mario Batali and Joseph Bastianich have reportedly been sued by workers in their East and West Coast restaurants. A complaint filed in late July 2010 by current and former employees of New York City’s Babbo Ristorante e Enoteca was amended to include a class of employees who work in five additional east coast eateries. They reportedly allege that the Batali-Bastianich enterprise “unlawfully confiscated a portion of their workers’ hard-earned tips in order to supplement their own profit. At the end of every shift, instead of distributing customers’ credit card tips to the workers who earned them as the law requires, Mr. Batali, Mr. Bastianich, and their restaurants took from the tip pool an amount equal to approximately 4-5% of the restaurants’ wine sales (and sometimes other beverage sales) for the night and put it in their own pockets.” The New York plaintiffs are apparently seeking class certification and…
According to news sources, a New York woman is seeking $5 million in damages in a putative class action against General Mills, alleging that the company falsely promotes its Fruit Roll-Ups® and other fruit snacks as nutritious and healthy while failing to properly disclose to consumers that partially hydrogenated oil is a product ingredient. McClure v. General Mills, Inc., No. 10-05015 (S.D.N.Y., filed June 29, 2010). Plaintiff Payton McClure, who reportedly describes herself as a “lifelong consumer” of General Mills products, contends that partially hydrogenated oil is “dangerous” and “unhealthy.” She apparently seeks compensatory and punitive damages, among other remedies. See Reuters and NYDailyNews.com, June 29, 2010.
The attorneys for a woman who recently reportedly sued General Mills for failing to properly disclose that its fruit snack products contain partially hydrogenated oil also represent a man who has filed similar claims against the companies that make and sell Yoo-Hoo®, a chocolate beverage. Dahl v. Mott’s LLP, No. __ (E.D.N.Y., filed June 29, 2010). Information about the General Mills lawsuit appears elsewhere in this Update. According to plaintiff Timothy Dahl, the defendants promote Yoo-Hoo® as a nutritious and healthy product, claiming that it contains vitamins and minerals, has no preservatives and is 99 percent fat free and 99 percent caffeine free. The complaint states, “Unfortunately for consumers and, in certain cases their children, all these claims are false and misleading. Defendants’ healthful claims are misleading since the Product fails to properly disclose they contain a highly unhealthy, non-nutritious ingredient known as partially hydrogenated oil. This partially hydrogenated oil…
A federal magistrate in New York has recommended that the district court deny the class certification motion filed by plaintiffs who allege either personal or economic injury from the purchase of frozen ground beef products purportedly tainted with E. coli. Patton v. Topps Meat Co., No. 07-654 (W.D.N.Y., recommendation entered May 27, 2010). The defendants include the meat processor and a number of retailers, and the claims are based on a 2007 recall involving more than 20 million pounds of ground beef. Forty cases of E. coli infection in eight states were allegedly traced to the product. The plaintiffs sought to certify two nationwide classes of those who consumed the product and have personal injury claims and those who purchased the products subject to the recall and allege economic losses. Because specific causation, that is, “whether the contaminated meat caused the personal injuries of the individual class members,” would require an…
The Second Circuit Court of Appeals has returned to a federal district court litigation alleging that a karate instructor was fired because he was obese in violation of a New York City law that forbids disability-based workplace discrimination. Spiegel v. Schulmann, No. 06-5914 (2d Cir., decided May 6, 2010). According to the appeals court, no cases have yet addressed whether the city law applies to the obese, and the lower court was directed to consider whether the plaintiff had made a prima facie case of discrimination under that law. The plaintiff, who claimed his roommate was fired from a similar position after the plaintiff notified the defendant that he intended to file an employment discrimination charge, also alleged unlawful retaliation under the Americans with Disabilities Act (ADA). Affirming the lower court’s dismissal of this claim, the appeals court found that the ADA does not permit an individual to be held liable…
Alleging that her habit of consuming two to three bags of microwave popcorn daily between 1991 and 2007 caused her severe lung disease, a New York resident has sued a host of defendants, including 100 “John Does,” in state court. Mercado v. ConAgra Foods, Inc., No. __ (N.Y. Sup. Ct., Queens Cty., filed May 3, 2010). Agnes Mercado, who claims that her lung disease requires the regular use of an oxygen tank and will likely require a lung transplant, contends that the diactyl in Act II buttered popcorn caused her injury. She sued the product’s manufacturer, flavoring companies and unknown companies that “manufactured, designed, packaged, marketed, labeled and sold added diacetyl to Givaudan for use in its butter flavorings that were sold and distributed to ConAgra for use in ConAgra’s Act II Lite microwave popcorn.” The plaintiff claims that any statutes of limitations have been tolled by defendants’ concealment of information…
A group of insurance companies has sued another group of insurers, seeking a declaration that the defendants are also required to indemnify and defend flavoring companies that have been named as defendants in lawsuits by former microwave popcorn- and candy-plant employees alleging injuries from exposure to diacetyl. Arrowood Indem. Co. v. Atl. Mut. Ins. Co., No. 10600881 (N.Y. Sup. Ct., N.Y. County, filed April 7, 2010). While the plaintiffs anticipate that additional diacetyl exposure lawsuits will be filed, they allege that they have been defending, subject to a reservation of rights, seven cases already filed in Illinois, Missouri, Montana, and Ohio. The plaintiffs contend that the defendants have either wrongfully denied any coverage obligations or refused to respond to requests for contribution to the litigation defense or indemnity costs. Seeking declaratory relief, the plaintiffs also ask for damages, attorney’s fees, interest, and costs.
Old Republic Insurance Co. has filed a lawsuit in a New York state court, seeking a declaration that it is entitled to reimbursement for the costs it has incurred defending a company that distributed diacetyl and has been sued with other companies for personal injuries allegedly sustained from exposure to the butter-flavored chemical. Old Republic Ins. Co. v. The Travelers Indemnity Co., No. 10103533 (N.Y. Sup. Ct., filed March 18, 2010). According to the complaint, some 21 active lawsuits are currently pending against Old Republic’s insured, Citrus & Allied Essence, Ltd. The carrier claims that it has successfully defended the company for three years at a cost of more than $1 million in cases where other carriers, including one that is now insolvent, share coverage and defense responsibilities.
The U.S. district court judge now presiding over the obesity-related claims in Pelman v. McDonald’s Corp. has ordered the parties to refile a number of documents previously submitted on motions addressing class certification. Pelman v. McDonald’s Corp., No. 02-7821 (S.D.N.Y., order entered March 24, 2010). Among the documents the court has requested are the defendant’s motion for an order striking the class allegations in plaintiffs’ second amended complaint and plaintiffs’ cross motion to certify a class and motion for an order further denying the defendant’s motion to strike. Filed in 2002 and appealed twice to the Second Circuit Court of Appeals, this litigation seeks damages for the obesity-related health conditions of teenagers who contend they were misled by fast food advertising. Claims that the food consumed in defendant’s restaurants caused the plaintiffs’ health problems are no longer in the case.
