My lawyers will be in touch (whoever they are…)
I picked up three pounds of shrimp at Frostman’s yesterday. They were on special for $10 a pound and the best part was that I got one pound of them essentially for free, because I had an extra $10 from a class action settlement. I’d tell you what it was for, except I can’t remember. But it gives me a chance to recycle something about class action settlements that never made it to this site, so it’s win-win (since it’s time to post something anyway and it’s been a quiet week for me.)
Class action lawsuits are more fun than coupon clipping. I received another notification recently that informed me that I’m a member of a yet another aggrieved class. I’d tell you more about it, but I can’t remember what that one was about either. I’ll just wait to see what shows up in the mail in a few years because the lawyers will take care of everything. Most of the time, it’s a pittance, like the $10 I put toward my shrimp – but you just never know. Sometimes you have to actually file a claim, but it’s a lot easier than it used to be because you can do it online.
Up until 2009, my all-time record amount for my personal share of a settlement was $60. It had to do with the way utilities were calculated in an apartment complex that we lived in for several years in Indiana. As it turned out, the developer had thousands of apartments all over the country, so it was well worth it for the lawyers to assemble the class. They made millions and I got $60, but that’s the way the best class action suits go. You get a huge number of people, each of whom has a relatively small, but perfectly legitimate stake. (If they each had a substantial amount of money involved, then they would just get their own lawyers and sue for themselves.)
There was one for baby formula and another for CDs. I remember one where an insurance company was incorrectly rounding monthly payment amounts so that they ended making an extra dime a year per customer over the premiums they quoted or something like that. Well, you take millions of policies and stretch it out over a few years and you’ve got enough to put some lawyers in Bentlys for awhile. (Policyholders probably got $1.50 credit each or something. I don’t remember.)
Anyway, my best ever was a check for $126.63 from the LiPuma vs. American Express suit. It had to do with the manner in which American Express failed to disclose its foreign exchange fees and it was a long and treacherous journey through the courts. The suit was originally filed in 2003 and at the time, “our” lawyers felt that the settlement could end up being as high as $800 million. I’m happy that it wasn’t because I would have come out with a lot less. The reason is because they would have paid off everybody and we’re talking about many millions of people. As it was, it ended up being a few hundred thousand of us and everyone didn’t get the same thing. (I monitored things on a travel site where people were reporting what they received. The low is $13.47 and the high was around $1,500.)
Some people like to dash off e-mails to all their friends when they hear about a class action lawsuit with a link to the claim form. While I certainly appreciate it, I never do that myself. When it’s time to divvy up the money, how many more people do you really want in there competing for a share? (So just send me an e-mail and it will be our little secret, okay?)
At $75 million in the LiPuma case, (with $11 million of that going for attorney fees), the lawyers for American Express more than earned their money by establishing smaller parameters for the settlement class and the total amount. Instead of simply crediting everybody with foreign exchange transactions on their accounts during the period with a share of the settlement on their respective American Express bills, people had to file a claim to share in the pot.
Of course, this was appealed by another group of lawyers looking for some justice — (and perhaps a piece of the action, I suppose) — but thankfully, they lost. Sure, it cut down the total amount. But more importantly, it cut down the number of people who would get anything at all. I have no problem with them shaking loose more than 90 percent of the potential claimants, so long as I happen to be one those left standing and the reduction to the pot is less than impact of splitting it with the massive crowd that got thrown under the bus. I’d rather split a $20 bill with you than $1,000 with 200 other people, you know?
The amount of the refund was based on how much time you spent outside of the U.S. between a couple of dates and there was a special premium for people who had gone to Turkey during the period, which I had. I guess Ed LiPuma got a chance to file for $10,000 from the court. (I don’t know if he got it or not, but I’m guessing he probably got a Christmas card or two from our legal team.)
So, you might be wondering if all of this meant that American Express — (along with Visa and MasterCard, who had similar suits brought against them for the same thing) – ever stopped fleecing their customers on their foreign exchange transactions. The answer is no. They still rake off the same fees that got them into trouble in the first place and maybe they’ve even increased them, for all I know. But they DO disclose the charges and it’s somewhere in the fine print of your cardholder agreement now. You feel better knowing that, right? Case closed. Time for a shrimp sandwich.