No one has a precise count of the class action settlements that include cy pres payments, and Frank said many may be included in quiet agreements that are never disclosed to the class. Federal courts dispose of about 275,000 cases a year, with 350 of them class actions.
"This case is really about attorneys selling out their clients," Holyoak told the Washington Free Beacon. "We are arguing that this is unfair, and this is an abuse of the class action system, and an abuse of the cy pres system."
The who, what, why, and how of CCAF's Supreme Court argument.
Enter Ted Frank and Melissa Holyoak, who objected to the settlement. They argued that the distribution of funds violates the federal rule for civil procedures that a class-action settlement be “fair, reasonable, and adequate.” The class counsel must also “fairly and adequately represent the interests of the class.”
"The fact that legal aid organizations do good things and could use the money doesn't justify the means," said Frank, who is also director of the Center for Class Action Fairness at the Competitive Enterprise Institute.
“The settlement at issue in Frank vs. Gaos epitomizes cy pres abuse in class actions, where money is funneled to a slush fund for lawyers to send to their alma maters and pet causes rather than their clients,” CEI Senior Attorney Melissa Holyoak told Legal Newsline.
“EasySaver is a disturbing example of how the Ninth Circuit’s lenient approach to cy pres in class action settlements creates an incentive for class attorneys to favor sending money to their preferred causes and institutions even when distribution of funds to the class is feasible,” said [Ted] Frank.
Today the Center for Class Action Fairness filed a supplemental brief with the Supreme Court, arguing the Ninth Circuit’s decision in the EasySaver case earlier this month underscores the need for its proposed standard governing cy pres settlements in class action suits when the court decides Frank v. Gaos. “EasySaver is a disturbing example of how the Ninth Circuit’s lenient approach to cy pres in class action settlements creates an incentive for class attorneys to favor sending money to their preferred…
Our class action legal team at Center for Class Action Fairness, has a video explainer on their upcoming case before the U.S. Supreme Court this term, Frank v. Gaos.
NYT: Theodore H. Frank is familiar with the adage that a lawyer who represents himself has a fool for a client. But later this month, he will stand before the Supreme Court to argue his own case.
