Posts Tagged ‘Unfair Competition’

Dennis Herrera Throws Down: Announces $5 Million Settlement with Bank of America Subsidiary’s “Arbitration Mill”

Monday, August 22nd, 2011

Here’s another victory for San Francisco’s Happy Warrior, City Attorney Dennis Herrera.

All the deets, below.

“Herrera secures $5 million settlement, tough consumer safeguards against BofA credit card subsidiary

Three-and-a-half-year-old case continues to win industry reforms nationwide to protect credit card holders in debt disputes

SAN FRANCISCO (August 22, 2011) — City Attorney Dennis Herrera today announced a major settlement agreement with the credit card subsidiary of the nation’s largest bank, Bank of America, in his three-and-a-half-year-old litigation against a so-called “arbitration mill,” which banks engaged to virtually assure they prevail over their credit card holders in binding arbitration proceedings. Herrera’s suit sought injunctive relief and penalties. The settlement secures $5 million for City taxpayers, and imposes tough, enforceable protections for California’s credit card holders in their debt disputes with FIA Card Services.

Under the terms of Herrera’s settlement noticed with the San Francisco Superior Court today, FIA will make a one-time settlement payment in the amount of $5 million, and agree not to arbitrate consumer credit card collections in California for two years. The credit card subsidiary has also agreed to not use the National Arbitration Forum in arbitrations with its card holders for at least five years, and to refrain from enforcing unconfirmed arbitration awards obtained through NAF, which was among the nation’s most notoriously anti-consumer arbitrators when Herrera filed his litigation in March 2008. FIA is also prohibited from barring consumer class actions challenging FIA’s practices. Herrera won a preliminary injunction against FIA early in his litigation, in April 2008, to halt the company’s practice of disclosing Social Security numbers and other private information of its customers in publicly available court records in San Francisco.

“This is a very significant settlement — not just because of its blockbuster dollar amount, but because it’s another milestone in a case that has helped reform the credit card industry’s abusive practices,” said Herrera. “For most consumers in debt disputes, binding arbitration was a sham that never gave consumers a chance — and major banks knew it. Credit card holders were often also victimized by outrageous attorneys’ fees and costs, which were illegally tacked onto arbitration awards against them. I’m very proud of a public interest lawsuit that continues to send a powerful message to the financial industry, and that has caused even the nation’s largest financial institutions to reform their conduct.”

Herrera initially filed his litigation against FIA Card Services and the National Arbitration Forum in March 2008 for violations of California’s Unfair Competition Law. The litigation would soon after feature prominently in a BusinessWeek cover story entitled “Banks vs. Consumers (Guess Who Wins),” in June 2008, which relied on key facts from San Francisco’s case, including statistics showing that consumers prevailed in just 30 cases out of more than 18,000 arbitrations brought by businesses that went to a hearing — less than two-tenths of one percent.

In July 2009, the National Arbitration Forum announced that it would cease handling consumer credit card arbitration matters after a state attorney general followed Herrera’s lead in filing a separate consumer protection case. A month later, Bank of America agreed to drop its longstanding requirement that consumers with credit card disputes enter into binding arbitration. That change by the nation’s largest bank freed millions of credit card consumers from binding arbitration requirements, enabling them to pursue civil actions in neutral courts. Herrera’s case remains in active litigation with NAF, which his office continues to pursue for financial penalties and other relief.

The City Attorney’s case is: People of the State of California v. National Arbitration Forum, Inc.; FIA Card Services et al., San Francisco Superior Court No. 473-569, filed March 24, 2008.”

Dennis Herrera Throws Down: Demands Proof of Accuracy for Intelligender Pregnancy Test

Wednesday, March 10th, 2010

City Attorney Dennis J. Herrera can’t abide companies that don’t prove their claims. So today he’s going after Intelligender LLC because of its “in-home fetal gender prediction product” that you can get at Walgreens. For the record:

“IntelliGender, the Plano, Texas, creator of the “Boy or Girl Gender Prediction Test,” says scientists isolated certain hormones that when combined with a “proprietary mix of chemicals” react differently if a woman is carrying a boy or a girl. It claims that within 10 minutes of taking the urine test, a woman will be able to tell her baby’s gender. The specimen will turn green if it’s a boy, and orange if it’s a girl.”

The question is about accuracy, primarily.

San Francisco’s Happy Warrior:

As always, follow the action on the Twitter.

Herrera demands proof of accuracy, safety claims by IntelliGender in-home test

City Attorney invokes authority under Unfair Competition Law in seeking evidence for marketing claims by gender prediction test sold in S.F.

SAN FRANCISCO (March 10, 2010) — City Attorney Dennis Herrera today invoked his legal authority under California’s Unfair Competition Law to demand substantiation for advertising claims by Intelligender LLC that its in-home fetal gender prediction product, which is sold and marketed in San Francisco, is “totally safe” and over 90 percent accurate.

“California law empowers public sector attorneys to seek proof for marketing claims for products sold to the consumers they’re responsible to protect,” said Herrera. “Intelligender is a product that came to our attention in which some of the advertised claims are dubious, and for which supporting evidence is notably unavailable to potential customers. Women and families interested in purchasing products like this are entitled to see the evidence that will enable them to be better informed consumers.”

According to Herrera’s letter to the Plano, Tex.-based manufacturer:

“The IntelliGender Test purports to accurately identify the gender of a fetus as early as 10 weeks after pregnancy, and well before ultrasound confirmation of fetal gender is available to expectant mothers. However, according to online reviews of your product, it appears that your advertising claim that the IntelliGender Test is ‘over 90% accurate’ is questionable. Additionally, as your product packaging does not identify the contents of the IntelliGender Test, there are concerns about the safety and proper means of disposal of the Test.     

“The San Francisco City Attorney hereby requests that you provide evidence of the facts supporting the advertising claims of IntelliGender listed below, pursuant to California Business and Professions Code §17508, which empowers city attorneys to request substantiation of purportedly fact-based advertising claims. For all claims listed below indicating that scientific methods were utilized, please include full reports of experiments, methods, results, and outcomes, in addition to the CVs and biographies of the clinicians retained to perform these trials and tests.”

Herrera asked that Intelligender provide documentation responsive to his request by the end of the month, noting that we would consider seeking “an immediate termination or modification of the claim,” as state law provides, if the information were not forthcoming.

All the deets after the jump.

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