Sometimes, a law blogger has to look for compelling legal issues to write about, and sometimes the issues come to them, like when Lady Gaga gets hit with a class action for fraud:
The $5 million class action suit alleges that Gaga and her co-defendants, including Universal Music Group and its merchandising company, Bravado, retained a portion of the wristband proceeds and inflated shipping charges. The Michigan-based law firm claims to have uncovered evidence of racketeering through sources including “a review of publicly available documents and interviews with confidential witnesses,” according to the complaint.
The complaint is available here. (It’s not really a “$5 million class action.” Instead, the complaint alleges damages in excess of $5 million to satisfy the Class Action Fairness Act and create federal jurisdiction.)
The Claims Aren’t Frivolous, But Might Be Dismissed Anyway
There could be something to the lawsuit. The “Pray For Japan” bracelet website doesn’t identify any particular charity or non-profit the money is going to, appears to charge sales tax for what is supposed to be a donation, and adds shipping and handling fees that appear excessive. The plaintiff’s complaint doesn’t allege any specific facts demonstrating fraud, but that’s understandable: plaintiffs rarely have concrete evidence of fraud before filing a lawsuit. Apparently, some of the defendants previously admitted not providing “all” of the proceeds to charity, which at least gives the plaintiff probable cause for the claims.
The claims alleged — federal racketeering, consumer protection violations in all fifty states, and unjust enrichment in all fifty states — aren’t frivolous, and they’re plead fairly well without any obvious deficiencies, but they still might not survive the inevitable motions to dismiss and the opposition to class action status. Years of anti-consumer judicial rulings have gutted most of the force of these laws; as but one example, on the RICO Act claim, there are many courts which hold that a racketeering pattern needs to take place for more than a year and involve continuing, systematic mail or wire fraud — certainly something more than a handful of Lady Gaga’s tweets saying “all proceeds.”
As much as I would prefer that consumers could use these statutes to recover damages after consumer fraud, truth is, it’s extremely hard to win RICO Act cases (dismissing RICO claims against insurance companies), nationwide consumer fraud class actions are rarely permitted (federal appellate court noting, “In certification of litigation classes for claims arising under the laws of the fifty states, we have previously noted that the district court must determine whether variations in state laws present the types of insuperable obstacles which render class action litigation unmanageable”), and nationwide unjust enrichment claims are also rarely permitted (federal court holding “Yet state laws about theories such as those presented by our plaintiffs differ, and such differences have led us to hold that other warranty, fraud, or products-liability suits may not proceed as nationwide classes”).
Nonetheless, if the allegations are true, then the courthouse doors shouldn’t be shut to people wondering what happened with their donations meant for Japan. The suit raises legitimate questions, questions that the Gaga people aren’t answering.
The Plaintiff’s Counterproductive Media Blitz
The problem, though, is that the plaintiffs’ law firm has bent over backwards to make the case look like a sleazy effort to market themselves as personal injury lawyers. As if it wasn’t bad enough that they sent out press releases the same day they filed their complaint, on the complaint they eschewed the actual name of their law firm, Kresch Oliver, in favor of a marketing name, 1-800-LAW-FIRM.
Go see the 1-800-LAW-FIRM website. I dare you. I double-dog dare you. Within seconds of opening it, a massive floating box appears with a picture of Lady Gaga (likely copyrighted—did they obtain permission to use it?) and requests your name, email and zipcode. The site then claims:
Welcome to 1-800-LAW-FIRM, America’s most trusted legal network. Comprising a national network of the country’s top legal experts, the lawyers of 1-800-LAW-FIRM bring experience, knowledge, compassion, and commitment to every case and every client. We cover the entire spectrum of legal areas including accidents and injuries, bankruptcy, consumer protection, defective products, pharmaceuticals, employment/labor law, professional malpractice, veterans claims, and whistle-blower cases. Call 1-800-LAW-FIRM we’ll answer questions and concerns about your individual situation. Talk to us. You’ll quickly understand why we’re the nation’s most trusted legal network.
Emphasis mine. That’s a pretty tall claim: the “most trusted legal network” made up of the “top legal experts” in “the entire spectrum of legal areas?” Consider this article from the Michigan Bar Journal (Michigan is 1-800-LAW-FIRM’s home state), which says:
… an attorney may not use the generic terms “certified,” “specialist,” or “expert” if the claim cannot be factually verified. Without certification by a reputable organization or facts supporting a generic claim of expertise, an attorney risks violating [Michigan Rule of Professional Conduct] 7.1.
Maybe they have that “expertise” — too bad the website doesn’t bother to identify any of the lawyers, much less “facts supporting a generic claim of expertise” in “the entire spectrum of legal areas.” Indeed, it seems they only identified their own firm by accident on pages they didn’t mean to post, like an empty biographical page for a lawyer named “Johnny Doe.”
I imagine they paid quite a lot for this ‘social media marketing strategy’ to ‘get the conversation going’ about their website (they’ve tried to generate various Twitter hashtags related to the lawsuit), and I suppose the media blitz has worked to some extent: thousands of “Little Monsters” with no need for a lawyer now know the tacky name of their “most trusted legal network.” Hope that was worth it. Watch some Brian Tannebaum before you begin your next campaign.
On the flip side, judges have internet access. So do jurors. Neither is supposed to consider the lawyer or the lawyer’s marketing when making their decisions, but sometimes they do. Walking into court, the lawyers at Kresch Oliver might feel like Lady Gaga, but to everyone else they’re going to look like Weird Al.
And we haven’t even discussed what Lady Gaga’s lawyers will do with this embarrassing bonanza.