Reviewing 5 of July's top stories

Angry law school graduates, continuing cruise ship lawsuits, the Penn State fallout and more

Grouchy Grads

Many law school graduates are having a tough time finding jobs, evidently leaving them with plenty of spare time to sue their alma maters. The flurry of lawsuits started in February, when a group of recent graduates sued 12 law schools, including DePaul Law, Golden State, Hofstra Law and John Marshall Law School, claiming that the institutions misled them about their post-graduation job prospects. The plaintiffs’ lawyers continued their crusade in March, suing 20 more schools, several of whom filed motions to dismiss the lawsuits.

Those efforts were successful for two schools: Back in March, a Manhattan judge tossed the $200 million class action suit against New York Law School, ruling that would-be lawyers should be well aware of the dismal state of the economy. And last week, a Michigan court dismissed a similar $250 million suit against Cooley Law School, saying that the students “unreasonably relied upon” employment data when opting to attend Cooley.

Scandal Sanctions

After months of anticipation, the hammer finally fell on Pennsylvania State University Monday, when the National Collegiate Athletic Association (NCAA) announced severe sanctions against the school’s football program.

Penn State’s ordeal began last November, when it was revealed that former defensive coordinator Jerry Sandusky had molested multiple young boys over a 15-year period, with several incidents occurring on the university’s campus. Following these revelations, the university reportedly faced lawsuits from Sandusky’s victims and former assistant coach Mike McQueary, who witnessed one of the assaults.

The situation only worsened when former FBI Director Louis Freeh released the results of his independent investigation into the scandal. The so-called “Freeh Report” sharply criticized Penn State officials, including former general counsel Cynthia Baldwin, who allegedly failed to inform the Penn State board about a grand jury investigation into Sandusky’s conduct.

Following the report, the NCAA handed down a list of penalties that include a $60 million fine, a four-year ban on postseason play and the surrender of all football wins from 1998 to 2011. The university also removed the statue of former head coach Joe Paterno that had stood outside the stadium for more than a decade.

Continuing Claims

It’s been more than six months since the Costa Concordia cruise ship disaster, but the lawsuits just keep on coming. After charging the ship’s parent company, Carnival Corp., with gross negligence and fraud in January, a group of passengers recently filed a new suit against Carnival and the ship’s architect, claiming the cruise line knew that the ship’s hull design and power systems were defective. This comes on the heels of another complaint from four cruise ship performers, who are seeking $200 million for physical and emotional trauma.

In a separate case, an 18-year-old Panamanian fisherman is suing Carnival-owned Princess Cruises, for negligence, claiming that a cruise ship abandoned him and two friends when they were stranded at sea. Several cruise ship passengers spotted Adrian Vasquez and his two friends, who had been adrift for 15 days, and notified a crew member. But the cruise line says the ship’s captain never heard the news. Vasquez’s friends both died before the Ecuadorian navy rescued the boat almost two weeks later.

Patent Problems

Eastman Kodak Co. got some much-needed good news Thursday, when a district court declined Apple Inc.’s request to hear a patent suit dispute between the two companies, instead returning the case to bankruptcy court. The companies are feuding over numerous patents on technologies such as digital cameras, tablets and smartphones.

Just last week, the U.S. International Trade Commission ruled against Kodak in a patent fight with Apple and BlackBerry maker Research In Motion Ltd. Several days later, however, the Federal Circuit sided with the photo company, deciding that its digital cameras did not infringe Apple patents.

The outcome of these suits is especially significant for Kodak, which is hoping to raise money through upcoming patent auctions. The company filed for Chapter 11 reorganization earlier this year, after efforts to stave off bankruptcy through patent sales and leadership changes failed.

Settlement Snag

Most people would be happy with a $7.25 billion chunk of change. But several national retailers, including Wal-Mart and Target, aren’t so pleased with last week’s antitrust settlement over credit and debit card fees. Visa Inc., MasterCard Inc. and more than a dozen U.S. banks agreed to pay up to settle retailers’ charges that they fixed card fees. The fees, known as swipe fees or interchange fees, charge retailers 2 percent each time a customer makes a purchase using a card.

But the celebration didn’t last long. On Tuesday, Wal-Mart publicly objected to the settlement, saying that it allows credit card companies to raise fees in the future. “We encourage all merchants to put consumers first and refuse the settlement,” the company urged. The retail giant’s objection could jeopardize the settlement’s chances of winning approval from a federal judge.

Contributing Author

Alanna Byrne

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