Publications

American Family Enterprises (commonly known as American Family Publishers “AFP”), Ed McMahon, and Dick Clark have retained Wiggin & Dana to represent them in connection with far-reaching legal challenges to the legality of the popular sweepstakes AFP operates to promote sales of magazine subscriptions. Numerous state attorneys general, including Connecticut’s, have challenged the sweepstakes. AFP’s sweepstakes are also the subject of over 40 private class actions filed in state and federal courts across the country. These actions raise a host of legal claims. The federal class actions have been transferred to a single federal court in New Jersey for coordinated pretrial proceedings.

An aggressive defense strategy has forced the plaintiffs in the Connecticut State Court class action, captioned DeMichiel v. America Family Publishers, to indefinitely suspend prosecution of their claims. These plaintiffs must await the resolution of the federal litigation now pending in New Jersey rather than pursuing their claims. The Connecticut class plaintiffs will only be permitted to move forward if the pending federal litigation does not resolve all of the issues raised by the Connecticut litigation. By stopping the Connecticut litigation in its tracks, the Court was able to significantly reduced the expense of the private class actions and provide a blueprint for similar motions across the country.

Relying upon a newly promulgated Connecticut rule, AFP successfully had the case designated “complex litigation”. Under the new rule, complex litigation is assigned to a judge experienced in dealing with such cases, who is given wide discretion in the conduct of the litigation.

Immediately upon the case’s transfer to the complex litigation docket, AFP moved to stay the case until the parallel federal court litigation was resolved, arguing that litigating the same claims in different courts wasted resources, and presented a distinct risk of inconsistent and irreconcilable outcomes. The plaintiffs opposed the motion to stay, claiming that their claim was legally distinct from the claims asserted in the other cases.

The Court flatly rejected the plaintiffs’ argument, holding that the critical issue in assessing the propriety of a stay was the existence of common facts, not common legal theories. Indeed, the claims made by the Connecticut plaintiffs were factually identical to those raised by the other class plaintiffs. Recognizing that the prosecution of similar claims in different courts created the potential for waste, inefficiency, and inconsistent results, the court stayed the plaintiffs’ putative class action until the resolution of the federal actions pending in New Jersey.

Wiggin & Dana has also been actively working with AFP’s New York counsel to negotiate resolution of the actions brought by state attorneys general. To date, AFP has successfully negotiated settlements with 36 states, including, most recently, New York and Maryland. Negotiations are continuing with several other states with pending claims, including Connecticut.