Consumers often fall victim to predatory business practices. Companies will overcharge for goods and services or will take additional fees and costs when prohibited by law. In many instances, the consumer’s financial injury amounts to less than $100.00. Depending upon the particular court, fees for simply filing a lawsuit can range from $400.00 to $1,500.00. Of course, the filing fee does not include charges for filing other pleadings, taking depositions, hiring experts, etc. Consequently, the predatory company gets to keep its ill-gotten gains simply because it costs more money to file the lawsuit than the potential recovery amount. Companies know this simple fact and exploit the system to obtain these ill-gotten gains.
On the other hand, class action litigation gives a powerful tool to consumers and other plaintiffs harmed by the predatory practices. Both federal and state law allows a single plaintiff to file suit not only on behalf of his or her individual economic and financial interests but also on behalf of all other persons who were financially harmed by the same or similar predatory practice or injury producing event.
For example, Melancon | Rimes represented two married couples that were overcharged interest on their home mortgage loans. Their national mortgage lender programmed its computers to withdraw late payments from monthly payments before applying the payments to interest and principal. This artificially inflated the principal loan balance in violation of the promissory note’s expressly worded terms, thereby overcharging interest to the couples’ loans. In each case, the overcharge amounted to approximately $100.00. Melancon | Rimes filed suit against the national mortgage lender, which ultimately agreed to provide a settlement fund of approximately $6.7 million to refund for interest overcharges.
In a separate example, Melancon | Rimes represented a single plaintiff, who realized that her insurance company was charging a $65.00 fee in violation of Louisiana’s statutory law. The insurance company charged this fee to over 167,000 other policyholders as well. Melancon | Rimes ultimately forced the insurance company to fund all policyholders the $16.5 million illegally charged to them.
If you believe that you were improperly overcharged or fell victim to a predatory practice, or you are an attorney looking to partner with a law firm with proven class action experience, please call our office today to discuss your case. Melancon | Rimes does not charge any fee for case consultations.