Class-Action Lawsuit May Cost Sharper Image $900 Million

267 Views
Since 1999, 3 million consumers have bought the $300 Ionic Breeze, and while the product is made to clear the air of dust, pollen, and other pollution, many were "ineffective" and "in some cases caused more health problems such as allergies," says an article on law.com.

The lawsuit, which is being pushed by 27 state attorneys general and several plaintiffs attorneys, could push Sharper Image into bankruptcy. However, if the company can convince U.S. District Judge Cecilia Altonaga in a final hearing that compensating consumers in cash could severely damage the company, then Sharper Image can possibly escape bankruptcy.



According to the article, James Hitchner of the Financial Valuation Group of Atlanta is expected to show and to "testify about his conclusions that the company is 'both weak and underperforming' and has a 'high probability of bankruptcy within the next 12 months.'"

What, then, is the solution?

Attorney Robert Parks, representing a plaintiff's group, "is seeking final approval for a settlement that would provide consumers with $19 coupons for future purchases, plus an 'ozone-guard' attachment to the machine, subject to availability," continues the article.

While Parks thinks they have a "strong, viable settlement," Miami attorney Michael Tein "who represents an estimated 2 million consumers in a parallel class-action lawsuit...argued in court papers that class members should be fully compensated in cash. He said the coupon settlement would provide plaintiffs with, after shipping and handling, socks, a holiday CD, or a trick gold ball."

Other lawyers representing the consumers agreed. One of their arguments is "that the settlement does not meet the spirit of the 2005 Class Action Fairness Act." And according to the same article, "recent studies suggest that only 13% of coupons are redeemed in consumer class actions."

Lead counsel Amy Radon also said that "the fact that the only way in which class members can obtain value from their coupons is by spending more money at Sharper Image raises serious questions about the fairness of this agreement."



Featured Testimonials

I like the volume of jobs on LawCrossing. It is a good site to refer to anyone concerned with the legal profession.
Darren


Facts

LawCrossing Fact #114: We talk to real people and know that communication is key.


Date
Location
Job Title
Sep 01, 16
US-NY- New York City

Litigation Paralegal The candidate will work on a class action lawsuit involving a l...

 

NOW TRENDING ON BCG ATTORNEY SEARCH

MOST POPULAR ARTICLES

Testimonial of the Week

LawCrossing has the most listings of any job board I have used. It's actually a great site. The website had a lot of detail. It’s nice that you don't have to go through a recruiter if you don't want to. You can actually contact the law firm directly for the positions listed. LawCrossing had a ton of great features.
  • Brian McMillan San Francisco, CA
Job of the Day

Corporate Attorney in Clayton, MO

USA-Clayton

Senior Counsel The candidate will provide legal counsel on a range of primarily commercial matters within the CAP&V...

Employer: Olin Corporation

Job Search Tip

Don't burn bridges. You'll need former employers and bosses as references. Leave graciously, even if involuntarily. Show them what a professional you really are and that's how they'll remember you.