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CLASS ACTION CERTIFIED AGAINST H&R BLOCK PHILADELPHIA — Suits filed against H&R Block alleging unnecessary fees for electronically filing clients’ tax returns may be tried as a class action and need not be arbitrated individually, the Pennsylvania Superior Court has ruled. According to the opinion in McNulty v. H& ., H&R Block asserted that all claims against it must be settled in arbitration, because the plaintiffs entered into a contract with a separate entity for refund anticipation loans available in connection with H&R Block’s e-filing services. “The trial court determined that the arbitration provision did not cover the present claims because the e-filing fee was too removed from the loan application contract that contained the arbitration provision,” Judge Richard Klein wrote for the panel. “After careful review of the parties’ submissions — we affirm, both on the rationale of the lower court and additional grounds.” The court also found that the arbitration clause was unconscionable as applied in this case. Klein was joined by Judge John Bender and Senior Judge Peter Paul Olszewski. The plaintiffs were represented by Pete Winebrake of Trujillo Rodriguez & Richards in Philadelphia. He said that he anticipates the e-filing class to eventually include thousands of members. When a client utilizes H&R Block’s e-filing system, the opinion states, the client can either have the refund check sent back in due time (usually about two weeks) or apply for a refund anticipation loan (RAL). According to the opinion, the RAL is an agreement made not with H&R Block but with another entity — in the McNulty case, Household Bank — in which the taxpayer receives cash within several days of filing using the promise of a tax refund as security for the loan. — The Legal Intelligencer

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