U.S. District Judge John Chun for Western Washington in Seattle denied the motion of Amazon and three of its executives to dismiss the FTC’s amended Amazon Prime complaint, said Chun’s signed order Tuesday (docket 2:23-cv-00932). The FTC’s Sept. 20 amended complaint alleges Amazon for years has tried to enroll consumers into its Prime program without their consent "while knowingly making it difficult" for them to cancel their Prime subscriptions (see 2309200069). Newly named in the amended complaint were Neil Lindsay, Russell Grandinetti and Jamil Ghani, Amazon executives with current or former Prime oversight. Amazon’s motion to dismiss argued that its Prime enrollment processes don’t violate the FTC Act or the Restore Online Shoppers’ Confidence Act (ROSCA), as the FTC alleged. Because this matter comes before the court on Rule 12(b)(6) motions to dismiss, the court must accept as true the allegations in the amended complaint and must view them in the light most favorable to the FTC, said the judge’s order. The FTC alleges that Amazon’s online cancellation process for Prime “required consumers to click six times and go through four screens, seeking to entice consumers not to cancel the subscription, or merely pause the subscription, before the consumer could finally cancel Prime,” it said. Viewing the amended complaint in the light most favorable to the FTC, the court can’t dismiss the claim that cancellation method wasn't a “simple mechanism,” as ROSCA requires, said the order. A "reasonable company in Amazon’s position" would be aware that state and federal laws, including ROSCA, "regulate negative option marketing and require that material terms be clearly and conspicuously disclosed and that they must obtain express informed consent before charging consumers," said the order. Viewing the amended complaint in the light most favorable to the FTC, the court concludes that the allegations "sufficiently indicate that Amazon had actual or constructive knowledge that its Prime sign-up and cancelation flows were misleading consumers," it said.

A Dish Network marketing contractor “met or exceeded” impression metrics specified in a marketing services agreement for the provider’s Boost Mobile phone services, but Dish never paid the amounts owed, alleged the contractor's fraud complaint Tuesday (docket 1:24-cv-01501) in U.S. District Court for Colorado. Los Angeles marketing firm Russell Westbrook Enterprises alleges Dish has refused to pay more than $1.4 million it owes for services provided under a “valid and enforceable contract.” RWE invoiced Dish four times from Dec. 31, 2022, to Aug. 31 last year, but the Boost parent never paid the amounts owed, never claimed the marketing firm failed to perform the work under their contract, never claimed the invoices were improper and “provided no explanation for its failure to pay the amounts owed,” it said. RWE notified Dish April 24 of its breach of contract for not paying the owed amounts, but the defendant didn’t respond, said the complaint. The plaintiff suffered and continues to suffer “significant damages” due to Dish’s breach of contract, breach of implied covenant of good faith and fair dealing and unjust enrichment, alleges the complaint. RWE seeks the amount due, plus interest; compensatory damages; and attorneys’ fees and costs. Dish didn't comment Wednesday.

Lisa Bodenburg is appealing the May 8 dismissal of her iCloud+ fraud class action against Apple to the 9th U.S. Circuit Court of Appeals, said her notice of appeal Friday (docket 3:23-cv-04409) in U.S. District Court for Northern California in San Jose. The plaintiff alleges that the iCloud+ service delivers consumers 5 GB less cloud storage than it contracted for when it accepted their monthly subscription payments (see 2308270001). In addition to breach of contract, the lawsuit alleges violations of several statutes, including California’s Consumer Legal Remedies Act and its Unfair Competition Law. Bodenburg received 200 GB of paid cloud storage that was stated in the plans and pricing information accessible through the link in her written iCloud+ agreement, said U.S. District Judge Trina Thompson’s signed dismissal order. Bodenburg thought she was receiving a different type of 200 GB, composed of 5 GB of free cloud storage and 195 GB of paid cloud storage, but in fact, she received 200 GB of paid cloud storage, said the order: “Clearly, she did receive the GB amount that was in the plans and pricing information, and therefore there are insufficient facts to support a breach of contract claim.” The judge also found that because the GB listed in the plans and pricing is more storage than the free 5 GB, Bodenburg can’t point to any false statements that Apple made. “Consequently, the heightened pleading standard is not met,” and the complaint “fails to state sufficient facts for any of the consumer protection claims,” said Thompson’s order.

The hourly rates that plaintiffs STC Two and Global Signal claimed for three attorneys in their breach of contract suit against defendant Thomas Branham are reasonable, but their total hours billed, nearly 370, “are beyond excessive,” said Branham’s memorandum Thursday (docket 2:23-cv-00764) in U.S. District Court for Southern Ohio in Columbus in opposition to the plaintiffs’ motion for attorneys’ fees and court costs. The plaintiffs seek an attorneys’ award of nearly $135,000 in the case, in which the court granted summary judgment in the plaintiffs' favor. Branham is permanently enjoined from blocking or otherwise interfering with plaintiffs’ access easement over the property to the cellsite 24/7, after plaintiffs sued him from maintaining a padlock on the gate at the entrance of the property without providing them a key. The defendant’s Thursday memorandum said the lodestar approach used to calculate total hours is considered by virtually all authority to be reasonable, but a court may adjust the lodestar in accordance with relevant considerations based on the degree of difficulty in the prosecution of a case and whether its issues were “novel or challenging,” said the memorandum. The “lack of novelty of the issues and the reduced degree of difficulty of prosecution are evident by the existence of the single issue in the case, i.e., defendant padlocked the gate to the leased cell tower premises,” it said: “This simple act denied plaintiff its right of access as set forth in the lease and in the site agreement.” Though Branham conceded that he did “vacillate during the case as to certain issues,” which “may have resulted in certain work by plaintiff’s counsel which otherwise might have been avoided,” he maintained “the totality of the hours of work by plaintiff’s attorneys is disproportionate to the issue in the case which issue is wholly singular.” Defendant’s counsel received payment of about $12,000 for 40 hours worked, said the memorandum. “The disparity in the hours worked by each side supports a finding that the total hours expended by the three plaintiff’s lawyers are excessive," it said. "Any award of attorneys’ fees should be greatly reduced from plaintiff’s requested amount."

Senior officers of Cambium Networks made “materially false” or misleading statements and failed to disclose “material adverse facts” about their business, operations and prospects between May 8, 2023, and Jan. 18, 2024, alleged Benjamin Hamby’s Securities Exchange Act class action Wednesday (docket 1:24-cv-04240) in U.S. District Court for Northern Illinois in Chicago. Cambrium designs, develops and manufactures wireless broadband and Wi-Fi networking infrastructure solutions. The complaint alleges that the company, its former and current CEOs and its former chief financial officer failed to disclose that the company’s distribution channels had an inventory buildup, that the company and its distributors were reasonably likely to offer aggressive discounts to reduce the high channel inventories and that revenue “would decline sequentially until the excess channel inventory was sold through,” it said. They also failed to disclose that Cambium was likely to incur “significant charges” to write down excess and obsolete inventory, and that as a result, its fiscal 2023 revenue and earnings would be “adversely affected,” it said. The complaint further alleges that the defendants’ positive statements about the company’s business, operations and prospects lacked “a reasonable basis,” it said. As a result of the defendants’ wrongful acts and omissions, and the “precipitous decline” in the market value of Cambium’s stock, Hamby and other class members “have suffered significant losses and damages,” it said. The complaint cites the example of Cambium’s Oct. 4, 2023, announcement that preliminary third-quarter 2023 revenue would fall between $40 million and $45 million, compared with the previous outlook of $62 million to $70 million. The company blamed the shortfall on a decrease in orders and an increase in stock rotations from distributors in the enterprise business, plus pressure from channel inventories, said the complaint. The disclosure sent Cambium shares tumbling 36.2% the next trading day on “unusually heavy trading volume,” it said. The market for Cambium’s securities “was open, well-developed and efficient at all relevant times,” said the complaint. As a result of the defendants’ materially false or misleading statements or failures to disclose, the company’s securities traded at “artificially inflated prices” during the class period, it said. Hamby and other members of the class purchased Cambium’s stock, “relying upon the integrity of the market price” of the company’s securities and market information relating to Cambium, “have been damaged thereby,” it said.

STC Two and Global Signal seek an attorneys’ fees award of $134,866.50 and a court costs award of $2,214.50, plus “other and further relief” as the court deems just and proper, said their motion (docket 2:23-cv-00764) Wednesday in U.S. District Court for Southern Ohio in Columbus in a fraud suit vs. a cell tower property owner. The plaintiffs' Feb. 24, 2023, fraud complaint (see 2302280015) alleged defendant Thomas Branham “willfully breached” a lease with STC for a 2,500-square-foot section of his property that employees of Global Signal, STC’s attorney-in-fact for the cellsite, had been accessing for over 20 years when he installed a padlock on the gate at the entrance to the cellsite and refused to remove it. In an April 25 opinion and order, U.S. District Judge James Graham granted summary judgment to STC Two and Global Signal in an award of attorneys’ fees pursuant to the terms of the lease (see 2404260008). Graham also granted plaintiffs’ motion for a permanent injunction against Branham, determining that plaintiffs’ injury suffered -- no unfettered access to the leased premises and potential for future harm -- “is irreparable, and cannot be adequately remedied with monetary damages.” Branham is permanently enjoined from blocking or otherwise interfering with plaintiffs’ access easement over the property to the cellsite 24/7 and from maintaining a padlock on the gate at the entrance of the property without providing plaintiffs a key, the order said. Permanently enjoining Branham from interfering with plaintiffs’ access serves the public interest “by ensuring reliable wireless communications services,” it said.

Plaintiff Lee Thompson seeks to recover “compensable damages” caused by Luna Innovations’ violations of the Securities Exchange Act on behalf of himself and others who owned Luna stock between May 2022 and April 19, said his securities fraud class action Wednesday (docket 2:24-cv-04068) in U.S. District Court for Central California in Los Angeles. Thompson alleges that the fiber-optic company, former CEO Scott Graeff and former Chief Financial Officers Eugene Nestro and George Gomez-Quintero made “materially false and misleading statements” about the company’s performance during the class period. The financial statements that Luna and its top executives issued for the first three quarters of 2022 and for Q1 of 2023 failed to disclose that they contained “unearned revenues that should not have been recognized,” and that the company would need to restate those financial statements, said the complaint. The reports also failed to mention that Luna’s disclosure controls and procedures didn’t provide “reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles,” it said. The statements also omitted mention that Luna’s disclosure controls and procedures weren’t effective, and that as a result, the company’s statements about its business, operations, and prospects “were materially false and misleading and/or lacked a reasonable basis at all times,” it said. The truth began to emerge March 12, after the markets closed, when Luna filed an 8-K with the SEC announcing that it would need to restate its financial statements for the second and third quarters of 2023 because the company “improperly recognized” revenue during those periods, the complaint said. The same day, Luna also filed notice that its annual 10-K report would be delayed so that a special committee of its board could investigate the circumstances under which the faulty quarterly financial statements were released to the investing public in the first place, it said. The notice of the late 10-K disclosed that the company anticipated reporting “material weaknesses in internal controls related to evaluating customer arrangements for proper revenue recognition and other controls,” and that the company would be “working to remediate these issues.” The news sent Luna shares plummeting nearly 36% the next trading day, March 13, said the complaint. Then on March 25, after the markets closed, Luna filed another 8-K with the SEC disclosing that CEO Graeff had retired, effective immediately, said the complaint. Upon information and belief, it said, defendant Graeff “retired as a result of the misconduct detailed in this complaint.” In early May came the termination, for cause, of Chief Technology Officer Brian Soller and the resignation of CFO Gomez-Quintero, it said. Luna also disclosed that CEO Graeff’s misconduct had triggered clawback provisions in his separation agreement, including the cancellation of all future severance payments, it said.

New York-based VideoShop, an app designed to help individual e-commerce sellers manage the sales process, owes Oves Enterprise, a Romanian software engineering company, $289,764 for unpaid invoices under a professional services agreement, alleged a breach-of-contract complaint Thursday (docket 1:24-cv-03581) in U.S. District Court for Southern New York. Oves “worked diligently” May 22-Oct. 3 to help VideoShops develop its “heavily publicized ‘social commerce’ platform” and sent time sheet invoices that the defendant preapproved, said the complaint. Terms called for VideoShops to pay Oves $54 per hour for software services related to the development of its “social commerce” platform, the complaint said. At least six dedicated Oves software engineers and programmers began work on or about May 22 and continued through Oct. 3, when work was halted due to nonpayment, said the complaint. VideoShops “received and retained” the invoices but “almost immediately defaulted on its payment obligations” to Oves and offered “a litany of ever-changing excuses for non-payment,” while promising to pay, it said. Excuses were accompanied by “false and misleading” promises to pay the outstanding invoices in an effort to induce Oves to continue performing services, the complaint alleged. VideoShop falsely claimed that nonpayment “was the result of bank errors,” said the complaint. The defendant didn’t comment Friday.

Reddit charged online stock trading platform LevelFields for clicks to link to its website, but the plaintiff’s system didn’t log traffic corresponding to the links it was charged for, alleged a breach of contract class action Wednesday (docket 4:24-cv-02760) in U.S. District Court for Northern California. LevelFields contracted with Reddit on Sept. 9, 2022, authorizing Reddit to place its ad on the social networking platform, said the complaint. The plaintiff contacted Reddit for click logs that would show corresponding associated IP addresses, but Reddit claiming it was unable to provide that and instead provided only logs without IP addresses, it said. LevelFields alleges that representation is “false, because Reddit has to know where traffic was coming from for security and monitoring purposes.” Alternatively, the defendant “is failing to provide minimal levels of security and monitoring of clicks on its platform, in violation of its duties,” said the complaint. Plaintiff and class members were charged by Reddit “for fraudulent clicks,” it said. LevelFields also claims violation of California’s Unfair Competition Law. It seeks an order enjoining Reddit from the practices alleged; awards of restitution, damages and disgorgement; attorneys’ fees and costs; and pre- and post-judgment interest.

IT services firm Information Technology Partners (ITP) owes network infrastructure company zColo $95,000 as part of a $175,000 settlement agreement the companies entered into July 15, alleged zColo's complaint Wednesday (docket 1:24-cv-01276) in U.S. District Court for Colorado. The settlement agreement resolved claims zColo previously asserted against ITP for failing to pay for services the plaintiff provided, but ITP hasn’t paid the full amount, the complaint alleged. The defendant failed to pay $1,921,685.74 to zColo, due under eight invoices dated between Aug. 1, 2021, and May 16, 2022, comprising $316,967.04 for services zColo already provided and $1,604,718.70 for the value of the services called for under the remainder of the agreement, said the complaint. Under the agreement, ITP was obligated to pay for the remainder of the order term upon early cancellation of the agreement, but it “terminated zColo’s services early and refused to compensate” it for services the plaintiff already provided and the remaining value of the agreement, said the complaint. The plaintiff filed a breach of contract suit Nov. 8, 2022, and entered into the settlement agreement Jan. 18, 2023, under which ITP agreed to pay $175,000 by July 15, 2023. The defendant made four payments totaling $80,000 but has failed to pay the remaining amount due, it said. The breach of settlement complaint seeks amounts owed zColo, plus attorneys’ costs and legal fees.