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Hanover Direct emerges victorious from legal battles

10
Sep '05
Branded merchandiser Hanover Direct Inc announced favorable outcomes in three litigations in which it was a defendant.

Previously the Company was named as a defendant in four class action and representative lawsuits involving allegations that the Company's charges for insurance on merchandise shipments was a deceptive trade practice under various state consumer protection statutes. Two of these lawsuits have had favorable outcomes.

In Jacq Wilson v. Brawn of California Inc filed under a California statute that permitted suits to be brought by non-class representatives of the general public, the Company had appealed a 2003 adverse decision where the trial court directed the Company to refund insurance charges and awarded plaintiff's counsel approximately $445,000 of attorneys' fees. On September 2, 2005 the California Court of Appeals reversed both the trial court's findings on the merits and its award of attorneys' fees. The plaintiffs have 30 days to appeal the decision.

In John Morris v. Hanover Direct Inc, the plaintiff alleged that the Company improperly added a charge for insurance on merchandise shipments that violated the New Jersey Consumer Fraud Act. Class certification was denied and the Company and plaintiff agreed to settle the action for approximately $40,000 comprised of a nominal amount of damages and attorneys' fees.

The Company is also a defendant in a class action filed in California, Teichman v. Hanover Direct, Inc., which has been stayed pending the outcome of the Wilson case and a class action filed in Oklahoma, Martin v. Hanover Direct, Inc. The Company appealed the class certification in Martin in 2002.


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