Federal Judge Freezes Starbucks Cold Drinks Lawsuit

By: Libby Casale*| Staff Writer 

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A federal judge recently threw out a proposed class action lawsuit that accused Starbucks of misleading customers about the amount of ice in its cold drinks.  The Plaintiff alleged that Starbucks “systematically defrauds its customers by advertising its cold drinks as containing more liquid than they do by ‘underfilling’ its cups with liquid and then adding ice to make the cups appear full.”  The complaint alleged that because Starbucks fills its cups to a “fill” line and then adds ice, that the actual amount of drink does not correspond to the listed amount.  The complaint cites the Venti Starbucks drink as an example.  As a result of the fill lines, the Plaintiff alleged that a Venti will contain approximately 14 ounces of liquid instead of the 24 ounces listed on the menu.   The complaint alleged claims for breach of express warranty, breach of implied warranty, negligent misrepresentation, unjust enrichment, fraud, and violation of California’s Consumer Legal Remedies Act. Continue reading »

IS WELLS FARGO OUT OF THE WOODS? DON’T BANK ON IT

By: Zack Young*| Staff Writer 

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By Ildar Sagdejev (Specious) – Own work, GFDL, https://commons.wikimedia.org/w/index.php?curid=17445718

Wells Fargo, the San Francisco-headquartered banking titan, has come under fire from seemingly all angles after creating nearly 2 million fraudulent bank and credit card accounts for customers without their permission. Lauded above competitors for its ability to remain profitable following the 2008 financial crisis, performance supposedly fueled by Wells’ operational discipline and internal controls, Wells Fargo has significantly undercut the goodwill its name had as a bank by creating sham accounts and charging customers fees on these accounts. In the wake of its fraud, Wells Fargo has been through the ringer. The Bank has settled civil charges with the city and county of Los Angeles, been charged with $185 million in fines, refunded close to $2.5 million to customers for the wrongful fees it charged, and received subpoenas from three different United States Attorneys’ offices. But the worst may still be yet to come for Wells Fargo. Continue reading »

Tumultuous Past Leads ITT Tech to Close All Campuses

By: Libby Casale*| Staff Writer

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ITT Technical Institute Canton, MI campus. Photo credit: Dwight Burdette

ITT Technical Institutes was founded at the end of World War II as part of International Telephone & Telegraph.  It split off from the corporation in the mid-1990s.  The spin off came at a time when privatization was embraced.  Investors flocked to the for-profit education sector. From 2000 to 2003 spending in the education sector was higher than any other sector on Wall Street. Continue reading »

Old Statute, New Tricks, and the Spirit of the Law

By: Santiago Herrera*| Guest Writer

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US Securities and Exchange Commission headquarters in Washington, D.C. The Trust Indenture Act of 1939 (“TIA”) is administered by the Securities and Exchange Commission. By D Ramey Logan – Own work, CC BY 4.0, https://commons.wikimedia.org/w/index.php?curid=36799399

The Trust Indenture Act (TIA) is a depression-era statute that was passed to protect retail investors and minority bondholders from majority bondholders and insiders who occasionally operated in collusion with the issuer to the detriment of minority bondholders and outsiders.

This is the purpose or spirit of the TIA: protecting the little guy.  Minority bondholders, however, are not always “little guys” in today’s financial markets.  Far from it.  Sometimes they are specialized distressed-debt funds or event-driven funds which buy minority positions—sometimes at a deep discount—to exert pressure on an anticipated debt restructuring, hoping to drive the price of the minority position up, and thus turn a profit on the investment. Continue reading »

Credit Rating Agencies Dodge Investors’ Lawsuits

By: Brad Fleming*| Guest Writer

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The “Big Three” credit rating agencies (CRAs)—Moody’s, Standard and Poor’s (S&P), and Fitch Ratings—have come under intense scrutiny in the wake of the global financial crisis.

Meant to provide investors and regulators with credit ratings which weigh the riskiness of various kinds of securities, companies, and governments, CRAs have instead exacerbated the financial crisis by skewing assessments to please their clients instead of providing accurate credit ratings.  In turn, these reckless credit ratings helped the financial system undertake far more risk than it could safely handle. Continue reading »

Coal Titans’ Bankruptcies May Cost Taxpayers

By: Rachel Raimondi*| Guest Writer 

https://upload.wikimedia.org/wikipedia/commons/0/05/Coal_mine_Wyoming.jpgAs the coal industry faces declining demand and struggles to recover from several “ill-timed multibillion-dollar acquisitions,” it becomes increasingly likely that taxpayers will be on the hook for exorbitant environmental cleanup costs.

Continue reading »

Driving With No Hands: How Tesla’s Autonomous Vehicle System Escapes Liability

By: Khalif Timberlake*| Guest Writer 

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As driver assistant technologies have developed, liability from vehicle accidents has increasingly become a topic of discussion. Exactly who should be responsible when these technologies fail and a person or property is damaged? Tesla Motors is widely considered one of the leading companies pioneering the trail of autonomous vehicle operations. Its system, named “Autopilot” can control steering, braking, and acceleration when activated. It uses a combination of cameras and sensors around the vehicle to determine its proximity to other objects and to map the road around the vehicle. Tesla vehicle owners have posted numerous videos online demonstrating showing Autopilot in use. Continue reading »

“Ooh, it makes me wonder” … Did Led Zeppelin Steal “Stairway to Heaven?”

By: Meredith Pace*| Guest Writer 

https://upload.wikimedia.org/wikipedia/commons/d/d3/Jimmy_Page_with_Robert_Plant_2_-_Led_Zeppelin_-_1977.jpgFor nearly half a century, Led Zeppelin’s “Stairway to Heaven” has touched the souls of guitar shredders across the globe.  The masterpiece is regarded as the “cut that was to FM radio what The Godfather was to cinema.”  Released in 1971 on Led Zeppelin IV, the eight-minute composition truly captures the psychedelic vibes of early rock and roll.  Yet, in later years, the mystical tune will surface not music charts, but court dockets. Continue reading »

Musicians Fight for a Change in Law to Stop Streaming from Cutting into their Royalties

By: Charity Barger*| Guest Writer

 

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By Concerttour – Own work, CC BY-SA 3.0

Over the last several decades, the ways in which music has become available to the public have been numerous: records, 8-track tapes, compact cassettes, CDs, downloaded music, and, now, streaming.  Nowadays, it is rare for a teenager to race to the music store to buy the latest CD from their favorite band.  In fact, CD sales have dropped 84 percent in the last decade.  Downloads, which were thought of as the “industry’s savior,” have been in a three-year decline. These changes are all due to the efficient trend known as streaming. Efficiency aside, streaming has started a fight between musicians and streaming providers.  YouTube has been accused of paying too little in royalties. “Last year, YouTube and sites like it generated $385 million in  royalties. In comparison, vinyl records . . . brought in $416 million.”  With an 84 percent decline in CD sales, the streaming statics are hardly comforting to musicians. Continue reading »

Arbitration: A Double-Edged Sword for Start-Up Employees

By: Michael Fleming*| Guest Writer 

https://pixabay.com/en/business-signature-contract-962364/For many, start-ups represent an opportunity to become a part of the next Uber, Venmo, Tinder, or to the most auspicious, Apple or Google.  Employees are willing to work longer than normal hours not only to be a part of something bigger, but also because they are rewarded with perks like daily catered lunches, company sponsored happy hours, and lavish trips.  In 2013, over 47% of college graduates were working for companies who employed less than 100 employees. A start-up’s mission goal, the culture, the pay scale, and the perks are simply too tempting for a college graduate to turn down. Continue reading »