Sarelson Law Firm is investigating allegations that several private "career" or "technical" colleges used deceptive advertising campaigns to encourage enrollment. Enrolled students frequently pay nothing out of pocket because the college goes to great lengths to ensure federally insured student loans cover the cost of tuition. Students' dreams of a good job upon graduation are just that - pipe dreams.
In recent months several federal government reports have concluded that many private, for-profit colleges routinely use unfair and deceptive business practices to lure students. The blog has previously discussed the government reports and is currently representing individuals who were employed or enrolled at several private career colleges.
If you are disappointed in the quality of your education at a private, for-profit college, or you were employed by a career college and witnessed improper and unethical business practices, Sarelson Law Firm would be interested in speaking with you.
In an effort to keep investors and clients informed about Sarelson Law Firm's continuing prosecution of the Paragon Properties of Costa Rica class action, here is a copy of the Second Amended Complaint (without the hundreds of pages of exhibits) filed on August 24, 2010. The lawsuit now has well over 100 named plaintiffs and 33 defendants. The document is 125 pages long - so please be patient.
The blog has previously covered its putative class action lawsuit pending against Paragon Properties of Costa Rica and dozens of related entities and persons. Earler today the Fort Lauderdale-based Sun-Sentinel wrote a lengthy article describing the fraud and the lawsuit.
Normally the blog doesn't cover gossip or personal interest stories. I leave that to David Marcus and SFL (both great blogs that I read daily).
But the blog is compelled to write about Juck Huck's decision to take senior status. Judge Huck is one of the finest district court judges in the United States. He is exceptionally bright, always prepared for hearings, and promotes quick and efficient justice.
But what makes Judge Huck stand out is his selfless abilility to admit when he's made a wrong decision. I'm reminded of the famous "Joe Cool" murder on the high seas trial. After the defendants were found guilty, Judge Huck, on his own initiative without any motion by the defense team, issued an order where he stated that he gave an incorrect jury instruction and that he had no choice but to grant a mistrial. Very few judges would so confidently admit that they made a mistake (without someone pointing it out) and declare, sua sponte, a mistrial. David Marcus covered the issue on his blog here. The blog wishes more judges would be as open to reconsideration as Judge Huck is.
Some lawyers have criticized Judge Huck for being difficult and too demanding -- but he's difficult and demanding of both plaintiffs and defendants, and that makes it completely fair.
Congratulations Judge Huck. Hopefully he will remain active as a senior judge.
Most banks hire so-called "foreclosure mills" to churn out hundreds, if not thousands of residential foreclosure lawsuits throughout Florida. Several judges have been very critical of these foreclosure mills because the files are not fully reviewed by lawyers (many procedures are outsourced overseas) and because important bank documents are frequently inaccurate or missing.
Florida AG Bill McMCollum (who is in a neck-and-neck race with Rick Scott for the Republican nomination for Governor) opened an investigation into potentially unfair and deceptive trade practices at three of the biggest foreclosure mills in Florida -- the Law Offices of David J. Stern, the Law Offices of Marshall C. Watson, and the law firm of Shapiro & Fishman. Julie Kay at the DBR has the story here.
The blog has previously covered two federal lawsuits (one a class action alleging deceptive trade practices and one alleging securities fraud) filed just last week against David J. Stern and his DJSP Enterprises.
The blog commends the AG for opening these investigations. Many smaller firms who handle foreclosure cases on a more personal level are being shoved aside and the end result of shady litigation practices. No one benefits from high-volume, cookie-cutter litigation.
If you are facing a foreclosure lawsuit by any of these companies, or any other large foreclosure mills such as the Tampa-based Florida Default Law Group, the Firm would be happy to speak with you regarding your rights and options.
A recent report by the non-partisan United States Government Accountability Office has undercovered massive fraud at numerous for-profit private colleges. The highlight is here:
"Our covert testing at 15 for-profit colleges found that four colleges encouraged fraudulent practices, such as encouraging students to submit false information about their financial status. In addition all 15 colleges made some type of deceptive or otherwise questionable statement to undercover applicants, such as misrepresenting the applicant's likely salary after graduation and not providing clear information about the college's graduation rate. Other times our undercover applicants were provided accurate or helpful information by campus admissions and financial aid representatives."
The full report is here. It is both fascinating and disturbing.
The Washington Post identified several for-profit colleges found to be engaged in fraudulent business practices. They include Kaplan University (which is owned by the Washington Post), the University of Phoenix (which is based in South Florida), MedVance Institute of Florida (with locations all over Florida), Westech College, and Everest College.
The report and the article were published several months after Sarelson Law Firm filed a False Claims Act lawsuit against MedVance. The MedVance lawsuit was covered in an earlier blog posting.
If you or somone you know was or is a student at one of the private, for-profit career colleges, we would be interested in speaking with you to determine if your rights have been violated.
Sarelson Law Firm is lead counsel in a putative nationwide class action against Paragon Properties of Costa Rica. At an August 3, 2010 hearing, the presiding district judge gave the plaintiffs until August 24, 2010 to add additional plaintiffs.
Anyone interested should contact Sarelson Law Firm in advance of the August 24, 2010 deadline.
E-books such as the Kindle, E-reader and Niche are all the rage. As it turns out, the major players in the industry - the equipment maker (Apple), the distributor (Amazon) and the content provider (the publishers) - may have colluded to set prices and to avoid competition from smaller publishers. The story is here.
This could be huge. The market for e-books is growing exponentially (and some analysts predict it will be the beginning of the end for print publishing). Consumers benefit from having bookstores compete for business by lowering prices and by putting pressure on publishers to lower their prices. If there is any collusion between or among these industry players, it would only hurt consumers and booklovers.
Not a good week for David Stern. A securities fraud lawsuit was filed against him and his company, DJSP Enterprises, Inc. The securities case was assigned to Judge Zloch. The civil RICO case discussed in an earlier blog posting was assigned to Judge Altonaga. A google search indicates that several other plantiffs firms have or are planning similar securities class actions.
A new putative class action lawsuit alleges that David J. Stern, P.A. and the Mortgage Electronic Registrations Systems, Inc. is a criminal enterprise. The complaint makes some pretty scandalous allegations and the major argument is that the way Stern and MERS handles foreclosures is unfair. The blog predicts this lawsuit will end with a wimper. The DBR story is here. The lawsuit is here:
Three Miami-based public adjusters - East Coast Public Adjusters, Inc., Premier Public Adjusting, Inc, and Ameriloss Public Adjusting Corp. - sued the State of Florida over recent legislation that limits the timing of the public adjuster's first contact with the potential client and caps the fees public adjusters can charge their customers. The 2008 amendments were enacted in the wake of several devasting hurricanes that created an opportunity for public adjusters to take advantage of the public.
If you purchased a 5 or 7 year adjustrable rate mortage (ARM) 5 or 7 years ago, your rate is supposed to automatically readjust to the current market rate (normally the "LIBOR" rate) at the end of the 5 or 7 year period. Banks loved these loans because the demand for them was great and the opportunity to have increased loan rates down the road was enticing. Everyone assumed the historically low rates from five years ago (5% or 6% easily) were historical lows and that by now rates would be 7% or higher. The bank, if it kept the note, would benefit from this increase. Consumers loved these loans also because it made the cost of home ownership cheaper and the home owners were all told -- almost as if it became the industry's talking point -- that they'd sell the homes in 2-4 years anyway.
But alas, the ARM period is over and its time for banks to readjust their rates -- downward. Yep, your ARM may actually have to adjust DOWN to comply with the LIBOR rate. So how does a bank make money when the loan rate drops? Simple -- delay dropping the loan rate. The blog is investigating allegations that lenders are waiting several additional months before they lower your rate back to the current prevailing market interest rate.
In a surprising opinion on an issue of first impression throughout the entire federal juridiciary, the Atlanta-based Eleventh Circuit Court of Appeals held that an "original action" brought in federal court under CAFA jurisdiction requires at least one plaintiff to satisfy the $75,000 amount-in-controvery requirement. Let's break it down.
First, CAFA jurisdiction was designed to allow defendants hit with "mass action" lawsuits in state court to remove the action if certain requirements were met -- you had at least 100 plaintiffs and the total amount in controversy was in excess of $5,000,000. Theoretically, federal courts are considered more defense friendly than state courts.
Second, CAFA allows plaintiffs to file suit directly in federal court (frequently because the plaintiffs actually prefer being in federal court). The open question was, if you file suit directly in federal court, are the jurisdictional requirements the same as if you filed in state court and the defendant removed the case to federal court under the same statute.
At first glance, you would think the answer is "yes the same requirements" apply because jurisdiction is jurisdiction. Who cares if your complaint was filed in state or federal court. The most basic premise behind "removal jurisdiction" is that the defendant can remove the case to federal court because the plaintiff could have filed the same exact suit in federal court at the outset.
We now know this is wrong. According to today's opinion in Cappuccitti v. Direct TV, in If you file suit directly in federal court under CAFA jurisdiction, at least one of the plaintiffs has to satisfy, individually, the $75,000 amount in controversy requirement. An original federal action where each plaintiff is owed only a few hundred or a few thousand dollars cannot be brought. Ironically, if the plaintiff filed the exact same lawsuit in state court, the defendant could remove the exact same lawsuit to federal court without having a jurisdictional defect. This seems silly but Judge Tjoflat's analysis of the statute seems hard to dispute. (This may be one of those "it makes no sense but take it up with Congress" opinions).
As a practical matter this opinion should not alter much in the class action world. Defendants are almost always going to remove the case to federal court if they have any possible chance of doing so -- and the parties may even enter into a presuit agreement that the case will be filed in state court and then, by agreement, removed to federal court.
This is an issue of first opinion, concerns a major federal jurisdiction issue, and almost certainly will be criticized by commentators - I'd bet a petition to the U.S. Supreme Court is in the works already. Questions about class actions? Contact Sarelson Law Firm today.
The blog has always wondered how big telecommunications companies get away with charging enormous fees. Wireless communication is essentially a commodity -- the wireless service on Verizon is not materially different from the wireless service on AT&T. Normally commodities are perfectly competitive, meaning competitors should and will continue to lower their prices (i.e., compete against each other for customers) until price equals marginal cost -- i.e., no profit. This is why most young entrepreneurs aspire to work and invest in finance or information technology companies, rather than become corn farmers or cattle ranchers.
Well at least one federal judge in California has now allowed a lawsuit that asks a similar question to move forward as a class action. Apple's enormously popular iPhone is locked to work with only the AT&T wireless network. Apple also signed, at least according to published reports, a secret five-year contract with AT&T to be the exclusive wireless carrier for the iPhone. Anyone wanting an iPhone must sign a two-year agreement with AT&T. At the end of the two-year period, iPhone users must sign a new contract with AT&T because of the secret exclusivity agreement between AT&T and Apple. This is as anti-competitive as it gets. Wireless phones and wireless service are two different services and two different industries with different players in the marketplace. Phone manufacturers are not also wireless carriers, and vice versa.
The AP article is here. Questions about wireless carriers or telecommunications companies? Questions about those nasty unidentified fees you seem to always pay rather than contest? Contact Sarelson Law Firm today to discuss.
