Legal Roundup: Pizza Hut Driver Sues for Minimum Wage, Lead Paint Manufacturers Under Scrutiny and More

A look at recent court decisions and how their rulings have an impact on risk management and the insurance industry.
By: | August 2, 2019

After 19 Years, California Lead Paint Claim Is Finally Settled

The Case: Back in 2000, a group of cities and counties in California sued paint manufacturers Sherwin-Williams, ConAgra Grocery Products Co. and NL Industries over lead paint used years — and even decades — ago.

They argued that the paint was a major driver of lead poisoning and that the companies were responsible for remediation.

Scorecard: The companies recently agreed to pay a $305 million settlement, according to a filing in the Santa Clara County Superior Court in California. But getting to that figure took years of litigation.

“A trial judgment in 2014 ordered the paint companies to pay $1.15 billion, but an appeals court decision led to the amount being slashed by more than half in 2017,” according to Reuters.

Once the companies had exhausted the appeals process, they threatened to sue individual property owners who received help cleaning up their properties, by claiming they had failed to properly maintain their housing.”

Takeaway: The settlement may not be as high as the cities and counties were hoping for, but these types of cases are hard to win.

Reuters explains: “The resolution marks a rare success for a public nuisance claim, under which counties and municipalities can sue corporations for past activities — including those conducted decades ago — they say have harmed communities. High-profile public nuisance claims have proliferated in recent years in the United States as local governments try to use the courts to make corporations pay for societal ills like lead poisoning, the opioid addiction crisis and climate change.”

Paralyzed Woman Who Was Repeatedly Denied MRI Sues Insurer

The Case: Was a woman unfairly denied a life-saving MRI?

That’s the question in the case of former school nurse Carolyn Daigle.

She has sued CIGNA Health and Life Insurance Company and others for allegedly denying her repeated requests for a lumbar-spine MRI she claims could have found a tumor that left eventually her paralyzed. She eventually got approval for the MRI but by then, the tumor did irreversible damage to her spine, she claims.

According to the New Hampshire Union Leader, her attorney Nick Abramson said Daigle’s “bright future has been sacrificed to avoid paying for a $2,000 MRI.” 

Scorecard: The case has just been filed. A CIGNA rep told the newspaper it does not comment on pending litigation.

Takeaway: It’s a tough call to determine what, exactly, is “medically necessary” — and getting it wrong can do serious damage.

Pizza Hut Delivery Drivers Sue Over Minimum Wage Discrepancy

The Case: Do pizza delivery drivers make below minimum wage if you factor in car repairs, gas and other costs?

That’s certainly the claim by Heath Jennings, who delivered pizzas for Dayton, Ohio-area Pizza Hut restaurants from 2013-2019. He’s suing franchise owner Hallrich Inc., claiming the company violated federal and state minimum wage laws.

Dayton.com reports that: “Similar lawsuits have been filed against other national pizza chains, and some law firms tout their success in such pizza-delivery class-action lawsuits on their web sites. The Nashville, Tennessee-based law firm that filed the Dayton lawsuit against a Pizza Hut franchisee has also filed a similar lawsuit against Papa John’s International in federal court in Kentucky earlier this year.”

The story goes on to say that at least “two of those similar lawsuits resulted in six-figure and seven-figure settlements right here in southwest Ohio, according to court records.”

Scorecard: Attorneys for Jennings are trying to expand the case to a class-action. We’ll see how it progresses.

Takeaway: We’ve seen this before in services as well as ridesharing.

In fact, New York City just mandated that rideshare drivers make a minimum wage of $17.22 per hour. As the gig economy gets more mature, expect to see more and more cases like this popping up in plenty of sectors. &

Jared Shelly is a journalist based in Philadelphia. He can be reached at [email protected]

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The R&I Editorial Team can be reached at [email protected]