The Center for Class Action Fairness objected to and then appealed the approval of a nationwide class settlement where 0.2% of the class received a cash benefit, a total of $225,000, and the remaining class members received low-value coupons. In the same settlement, $8.85 million went to the plaintiffs' lawyers and $3 million to local San Diego universities.
The Center represented a shareholder objecting to a securities class action wherein the $16.5M plaintiffs’ attorneys’ fee request was 4.2 times their normal billing rate. The district court reduced the excessive fee request by $3M.
CCAF objected to the fees in a securities class action in which class counsel sought an outsized percentage of the $590 settlement fund. Ultimately, the parties agreed to waive their cy pres provision in favor of distributing more money to class members.
CCAF represented an objecting class representative on appeal. The Eighth Circuit adopted all of CCAF's arguments; it held that charitable donation of class monies was inappropriate and that cy pres payments should only be used if further distribution to the class is not feasible. In addition, the court criticized the choice of the cy pres recipient because the St. Louis legal aid society was unrelated to the securities injuries alleged in the lawsuit.
The Third Circuit held that the disproportionate ratio requires scrutiny from a district court, and that courts and class counsel should not be indifferent to whether recovery goes to class members or cy pres. On remand, the parties modified the settlement to provide approximately $15 million of additional direct recovery to class members, and the district court awarded CCAF fees for its role in improving the settlement.
CCAF sought Supreme Court review for a challenge to a lopsided class action settlement agreement that left over 90 percent of the class with nothing while the lawyers got an outsized, 60 percent share of the settlement fund.
The Center objected to a settlement that paid the class $0, established meaningless corporate governance changes, and paid the attorneys over $10 million: the court agreed that fees were excessive and reduced the request by $4.6 million.
In this settlement over Apple power adapters, the district court failed to appraise class relief compared to the $3M that the settlement awarded to plaintiffs’ lawyers, and ordered an abusive appeal bond when the objectors appealed to the Ninth Circuit. CCAF prevailed on appeal.
As a result of CCAF’s objection, more than $2.3 million was distributed to class members instead of unrelated organizations. The parties had originally requested that these dollars be awarded to organizations unrelated to the litigation, a practice known as cy pres.
The Sixth Circuit agreed with CCAF that the district court should not have given credit to imaginary and illusory valuations of class relief. The landmark decision acknowledged that the fairness of a class settlement must be analyzed by how it treats class members versus class counsel-a distinction that far too many judges fail to make.
