Class-Action Objector Ted Frank Has Another ‘Cy Pres’ Challenge at SCOTUS
“The circuit split is still there,” Frank said. “They granted cert on it before and the Ninth Circuit is still signing off on some really appalling cy pres settlements.”
Supreme Court sends consumers suing Google over privacy issues back to court
Frank, litigation director at the Hamilton Lincoln Law Institute, said the case would now go back to appellate judges in the Ninth Circuit, who would decide whether to kick it to the Northern District of California or decide the matter themselves. “The day of reckoning has been postponed,” he told MarketWatch. “But the writing is on the wall.”
US Justice Dept. Says Cookie Class Action Settlement Not So Sweet
In the original settlement with Lenny & Larry’s, the DOJ estimated only $350,000 in cash went to the class members, and suggested that fees should be in the range of $228,000 to $463,000. The government was particularly critical of a provision that gave potentially $3.15 million in free cookies to General Nutrition Centers Inc. and The Vitamin Shoppe in the event that not enough class members make claims.
Appeals Court Returns Class Action To Lower Court After Only $225,000 Paid Out To Class Members, But $12M Awarded To Attorneys And Third-Party Universities
"We think the court got it half right," attorney Adam Schulman, who argued the CEI's position before the appeals court, told the Northern California Record, adding that the remanding of the attorney fees was welcome, but it still allowed millions of dollars to be disbursed to non-class members. The institute objects to the way the "cy pres" doctrine is used in class actions.
photo credit: www.proflowers.com
Money For Nothing: SCOTUS Could Stop Class Action Funds From Being Steered To Non-Parties
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.
SCOTUS Hears Case Against Google Giving Away Settlement Money To Friends
"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."
Class-Action ‘Charity’ Racket
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.”
High Court Case Threatens Key Source Of Legal Aid Funding
"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.
Supreme Court Case To Decide Issue Of Class Action Funds Directed To ‘Pet Causes’
“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.
Disputers Of Google Privacy Deal Cite 9th Circ. Award Ruling
“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.
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