Saturday, June 8, 2002
The other day, I opened my mailbox, and mixed in between the ubiquitous junk mail (“You may have already won...”) and the recurrent pile of bills (which sparked a deja vu epiphany “Didn’t I just pay these?”), was a missive bearing the phrase “Important Legal Notice.”
Now, like most people, I lead a fairly nondescript life, and endeavor not to run afoul of the law, be it civil or criminal. So I was warily curious as to the circumstances that would warrant delivery of an “Important Legal Notice.” With subtle trepidation, I tore open the envelope and perused the contents.
It was a Notice of Pendancy of Class Action, which simply meant someone was suing someone else and I had been invited along for the ride. The someone of the first part was a Mr. Gerald D. Broder and the someone of the second part was MBNA, a large bank and issuer of credit cards (and ubiquitous junk mail).
It seems Mr. Broder had obtained a credit card through an MBNA offer of a special low interest rate on cash advances. The offer stated MBNA “may” allocate payments to cash advances before purchases. This, of course, means MBNA could, at its discretion, apply the payment toward the cash advance balance (at the lower interest rate) or the purchases balance (at the higher rate). Mr. Broder claims MBNA’s solicitation was misleading and should have used the word “will” instead of “may.” So he is suing MBNA for fraud and breach of contract.
Ignoring the obviously shaky legal merits of the case, ephemeral dollar signs danced like sugar plums before my eyes. A wave of good will flooded over me, as I imagined what a kind man Mr. Broder must be, to invite me, a complete stranger, to share in his good fortune, should he recover damages from the scoundrels! And how would I spend this windfall from Providence? Amidst the beckoning siren call of the beaches of Nice, I flipped the pages to ascertain an inkling of the amount of my pending good fortune.
Surely, over the years as a customer of MBNA, I too must have been victimized by this dastardly ploy, as evidenced by my unsolicited admission to the class of litigants. Then, on page four, preceding the caveat “assuming plaintiff were 100 percent successful at trial” (okay, so this is the high end of what we might recover), was the telltale phrase “A significant factor relied upon by plaintiff and Class Counsel is that the $3.57 made available to each member of the class under the terms of the proposed settlement represents a significant percentage of the maximum amount recoverable, assuming plaintiff were 100 percent successful at trial.” Quickly, my mind translated the legalease to everyday parlance: If we win all of what we are asking for, the most any class member gets is $3.57; but this amount may be reduced if we get less than what we are asking.
No, I thought. I must have misread it. I could not have wasted all that time reading four pages of legalease to discover that my angel of Providence was cheaper than the tooth fairy! Surely, Mr. Broder would not sue MBNA to recover $3.57? And surely, Mr. Broder’s lawyers would not take on such a case. No, this required continued reading, at least to page six.
Alas, it was on page six that the truth did out. While listing no exact size, the class consists of the potential millions of present and former MBNA cardholders, each entitled to $3.57 (or less) should we win, and Mr. Broder, who is named as “class representative.” You see, in a class action lawsuit with thousands (or millions) of plaintiffs, someone’s name has to go on the paperwork as what they call the “lead” plaintiff; otherwise the case title would be longer than the case. For lending his name to the case, Mr. Broder’s attorneys asked that he receive a little bit more than his other plaintiffs, sort of a “first among equals” position. Thus, they decided that an extra $9,996.43, just to round it out to an even $10,000, would help compensate Mr. Broder for the use of his name.
Of course, Mr. Broder’s attorneys, the law firm of Lowey, Dannenberg, Bemporad & Selinger. P.C., also asked the court to award it a modest amount in legal fees (after all, it is helping people like me get as much as $3.57 in damages) not to exceed $2.5 million, to be paid by MBNA.
I’m glad they put the “not to exceed” in their request; otherwise the court might have gone hog-wild and thrown $5 million at them. How considerate and responsible of Mr. Broder’s lawyers!
So, Mr. Broder stands to gain $10,000 for doing nothing, his lawyers stand to gain $2.5 million for doing considerably more than nothing, and I, and my fellow victimized consumers may get as much as $3.57. More than likely, MBNA will settle the suit , and those numbers may be discounted by 25 percent.
Is there something wrong with this picture? Is there something wrong with a legal system where lawyers can initiate a class action suit using a straw man (purchased for less than 1/2 of one percent of their profits) to compel a large corporation to settle a nuisance suit for millions of dollars?
And lawyers still wonder why we hate lawyers.
The other day, I opened my mailbox, and mixed in between the ubiquitous junk mail (“You may have already won...”) and the recurrent pile of bills (which sparked a deja vu epiphany “Didn’t I just pay these?”), was a missive bearing the phrase “Important Legal Notice.”
Now, like most people, I lead a fairly nondescript life, and endeavor not to run afoul of the law, be it civil or criminal. So I was warily curious as to the circumstances that would warrant delivery of an “Important Legal Notice.” With subtle trepidation, I tore open the envelope and perused the contents.
It was a Notice of Pendancy of Class Action, which simply meant someone was suing someone else and I had been invited along for the ride. The someone of the first part was a Mr. Gerald D. Broder and the someone of the second part was MBNA, a large bank and issuer of credit cards (and ubiquitous junk mail).
It seems Mr. Broder had obtained a credit card through an MBNA offer of a special low interest rate on cash advances. The offer stated MBNA “may” allocate payments to cash advances before purchases. This, of course, means MBNA could, at its discretion, apply the payment toward the cash advance balance (at the lower interest rate) or the purchases balance (at the higher rate). Mr. Broder claims MBNA’s solicitation was misleading and should have used the word “will” instead of “may.” So he is suing MBNA for fraud and breach of contract.
Ignoring the obviously shaky legal merits of the case, ephemeral dollar signs danced like sugar plums before my eyes. A wave of good will flooded over me, as I imagined what a kind man Mr. Broder must be, to invite me, a complete stranger, to share in his good fortune, should he recover damages from the scoundrels! And how would I spend this windfall from Providence? Amidst the beckoning siren call of the beaches of Nice, I flipped the pages to ascertain an inkling of the amount of my pending good fortune.
Surely, over the years as a customer of MBNA, I too must have been victimized by this dastardly ploy, as evidenced by my unsolicited admission to the class of litigants. Then, on page four, preceding the caveat “assuming plaintiff were 100 percent successful at trial” (okay, so this is the high end of what we might recover), was the telltale phrase “A significant factor relied upon by plaintiff and Class Counsel is that the $3.57 made available to each member of the class under the terms of the proposed settlement represents a significant percentage of the maximum amount recoverable, assuming plaintiff were 100 percent successful at trial.” Quickly, my mind translated the legalease to everyday parlance: If we win all of what we are asking for, the most any class member gets is $3.57; but this amount may be reduced if we get less than what we are asking.
No, I thought. I must have misread it. I could not have wasted all that time reading four pages of legalease to discover that my angel of Providence was cheaper than the tooth fairy! Surely, Mr. Broder would not sue MBNA to recover $3.57? And surely, Mr. Broder’s lawyers would not take on such a case. No, this required continued reading, at least to page six.
Alas, it was on page six that the truth did out. While listing no exact size, the class consists of the potential millions of present and former MBNA cardholders, each entitled to $3.57 (or less) should we win, and Mr. Broder, who is named as “class representative.” You see, in a class action lawsuit with thousands (or millions) of plaintiffs, someone’s name has to go on the paperwork as what they call the “lead” plaintiff; otherwise the case title would be longer than the case. For lending his name to the case, Mr. Broder’s attorneys asked that he receive a little bit more than his other plaintiffs, sort of a “first among equals” position. Thus, they decided that an extra $9,996.43, just to round it out to an even $10,000, would help compensate Mr. Broder for the use of his name.
Of course, Mr. Broder’s attorneys, the law firm of Lowey, Dannenberg, Bemporad & Selinger. P.C., also asked the court to award it a modest amount in legal fees (after all, it is helping people like me get as much as $3.57 in damages) not to exceed $2.5 million, to be paid by MBNA.
I’m glad they put the “not to exceed” in their request; otherwise the court might have gone hog-wild and thrown $5 million at them. How considerate and responsible of Mr. Broder’s lawyers!
So, Mr. Broder stands to gain $10,000 for doing nothing, his lawyers stand to gain $2.5 million for doing considerably more than nothing, and I, and my fellow victimized consumers may get as much as $3.57. More than likely, MBNA will settle the suit , and those numbers may be discounted by 25 percent.
Is there something wrong with this picture? Is there something wrong with a legal system where lawyers can initiate a class action suit using a straw man (purchased for less than 1/2 of one percent of their profits) to compel a large corporation to settle a nuisance suit for millions of dollars?
And lawyers still wonder why we hate lawyers.
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