When class action settlement funds are not amenable to individual claims or to a meaningful pro rata distribution, courts have used the cy pres doctrine to distribute the funds to nonprofit charitable organizations whose work indirectly benefits the class members and advances the public interest.
However, cy pres proved unnecessary in Dial Corp. v. News Corp., No. 13CV6802, 2017 WL 5613949 (S.D.N.Y. Nov. 20, 2017). That antitrust action involved the distribution of a $250 million settlement fund, but the claims administrator and lead class counsel performed the distribution so efficiently that only $1.97 in accrued interest remained undistributed.
The court characterized this amount as “a sum so miniscule that attempting to distribute it among class claimants pro rata would be akin to splitting the atom.” It concluded that resorting to cy pres was needless for so small an amount. Instead, the court authorized the claims administrator to “keep the change.”
Dial Corp. v. News Corp., No. 13CV6802, 2017 WL 5613949 (S.D.N.Y. Nov. 20, 2017).