Settlement nears in lawsuit over Schnucks breach
Thursday, October 24, 2013
ST. LOUIS (AP) — The Schnuks grocery store chain has agreed to settle a class-action lawsuit stemming from a computer system breach that compromised the credit and debit cards of about 2.4 million customers.
In a preliminary deal presented Wednesday to St. Louis Circuit Judge David Dowd, Schnucks Markets would pay customers up to $10 for each credit or debit card that was compromised and had fraudulent charges posted on it that were later credited or reversed, The St. Louis Post-Dispatch (http://bit.ly/1ifPECq) reported.
The chain also would pay customers for certain unreimbursed out-of-pocket expenses such as bank, overdraft and late fees, along with paying $10 per hour up to three hours for documented time spent dealing with the security breach. There would be a cap on those expenses up to $175 per class member.
From December 2012 through March of this year, the Maryland Heights-based grocery chain’s systems were breached by hackers. The class-action suit, filed on behalf of Susan McGann and other Schnucks customers, is one of several lawsuits brought against the chain because of the breach.
A lawyer pursuing a related federal lawsuit that is still pending has filed a motion to intervene in the case, arguing that the proposed settlement may not be a good deal for consumers.
That attorney, Matt Armstrong, said at the hearing Wednesday that his client was not being adequately represented by the proposed deal.
Armstrong claimed that proper discovery had not been done in the case, so a better sense of the scope of damages and losses has not been disclosed.
“Nobody can figure out if this is a good deal,” he said.
Armstrong said he was concerned that the proposed deal could release Schnucks from some federal claims that could hold it responsible for as much as $1,000 for each violation.
Lawyers for the plaintiffs in the class-action case called his attempted intervention highly unusual. The also noted that Armstrong had filed the motion before he had even seen the proposed settlement.
John Steward, one of the settlement class attorneys, said that suggests Armstrong’s motion was more “lawyer-driven.”
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