Forbes profiles the Hamilton Lincoln Law Institute and its director Theodore H. Frank. William Baldwin explains how class action settlements work, and why Ted “is not a popular figure in the litigation bar”:
[L]ong before any witness is called to the stand, the case is settled. The settlement typically has the corporation agreeing to pay rewards to a few named plaintiffs working with the lawyers and a tiny recompense to the millions of consumers or investors who are in the class. This resolution is accompanied by a very generous contribution to the bank account of the plaintiff law firm.
That’s when Ted Frank or one of the six lawyers working with him jumps in. They ask the judge overseeing the litigation to reduce the pay to the plaintiff lawyers, increase the compensation to the victim class or just throw the whole case out. As often as not, they get a result. Frank says that Hamilton Lincoln’s Center for Class Action Fairness has participated in 125 cases and won at least a partial victory in a comfortable majority.
In August Frank’s institute scored a win in the Seventh Circuit when an appeals court threw out a $57 million payday for the lawyers who won $181 million on behalf of consumers who overpaid for broiler chicken. If the lower court goes along, grocery store customers will get a larger share of that $181 million. If you bought raw chicken between 2012 and 2019, submit a claim at overchargedforchicken.com.
A case that had Frank handling an oral argument before the U.S. Supreme Court in 2018 will finally draw to a close in October, when a district court is expected to approve a settlement of litigation over the way Google used search query data between 2006 and 2013. The original deal had Google buying peace by dishing out money to charities, paying victims nothing and rewarding the plaintiff law firms with $2 million. The Supreme Court bought Frank’s argument that this sort of settlement was unacceptable and kicked the matter back to lower courts. In the updated settlement, something like $16 million will be disbursed to the small fraction of web surfers who heard about the case and sent in claims before the July 31 deadline.
What does Hamilton Lincoln extract from such interventions? Not much. “We saved [class members] tens of millions in one case. We asked for $199,000. The court said, ‘Okay, here’s $12,000.’ After two appeals, we got that increased to $34,000.”
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What do investors get out of class actions? Sometimes, a lot. The litigation over securities violations involving Petrobras, the Brazilian oil producer, delivered a $3 billion pot, from which plaintiff lawyers wanted to pull a $299 million fee; Frank’s objections got $95 million of that fee re-routed to the victims.
A sidebar to the article also covers HLLI’s work in speech and regulatory cases like its suit protecting pharmacist speech rights and its challenge to Department of Labor ESG rules.
Hamilton Lincoln Law Institute has broadened its reach into such matters as free speech, fiduciary standards and affirmative action. “People are more interested in the First Amendment than the esoterics of 23(e)(2)(c)(ii),” Ted Frank says, referring to the rule on class action procedure.
HLLI is contesting rules limiting what doctors and pharmacists can say about Covid. It is also suing to stop a U.S. Labor Department rule that allows pension managers to favor nice-guy companies, despite a statute mandating that pensioners’ financial interests come first. “People in the Biden Administration are going off on their own ideological agenda,” Frank says. “The separation of powers is important. This is not a monarchy.”