In September 2019, the Federal Trade Commission issued a staff report titled "Consumers and Class Actions: A Retrospective and Analysis of Settlement Campaigns." The FTC staff studied 149 consumer class action settlements and conducted an internet-based consumer research study to explore consumer understanding of class action notices. Among the salient findings were: The overall claims rate of the cases in the sample was less than 10%. Specifically, the median ... Keep Reading »
Class Action Settlement Articles
The latest class action settlement developments and trends, including news, key cases, and strategies.
Objectors to Class Settlement Concerning Alleged Misrepresentations of Fuel Efficiency Run out of Gas in Ninth Circuit by Waiving Arguments
The Ninth Circuit recently addressed the propriety of applying California law to a nationwide settlement class. The Central District of California had hosted a consolidated multidistrict litigation of individuals who bought Hyundai and Kia automobiles and claimed to have been misled by the companies' allegedly inaccurate fuel efficiency estimates. The trial court originally denied certification of a litigation class, citing "material differences" in state law. ... Keep Reading »
Florida Supreme Court Refuses to Approve Amendment to Class Action Rule to Encourage Cy Pres Distribution of Residual Settlement Funds
Cy pres distribution of residual settlement funds has come under increased scrutiny in recent years. Perhaps for this reason, the Florida Supreme Court on May 16, 2019, refused to approve an amendment to Florida Rule of Civil Procedure 1.220, the state class action rule, that would have encouraged settling parties to distribute residual funds to The Florida Bar Foundation or another nonprofit legal services organization. The court, however, declined to provide any ... Keep Reading »
Third Circuit Finds Class Members’ Cash Advance Agreements May Fall Short of a True Assignment
On April 26, 2019, the Third Circuit Court of Appeals reversed in part and affirmed in part a district court order purporting to void cash advance agreements entered into by and between class members and litigation funding companies in In re National Football League Players' Concussion Injury Litigation. Following settlement of the underlying litigation, hundreds of class members entered into cash advance agreements with various litigation funding companies, including ... Keep Reading »
No Standing, No Settlement?
In a recent decision, the Eighth Circuit weighed in on the requirement that federal courts assess Article III standing before approving a settlement agreement. In the case at issue, plaintiff filed a putative class action for purported violations of the Fair Credit Reporting Act (“FCRA”) against a data company in state court. Defendant removed to the District Court for the Western District of Missouri. Shortly after the parties reached a tentative settlement ... Keep Reading »
The Bitter and the Sweet
On October 3, the Eleventh Circuit Court of Appeals affirmed the district court’s approval of a class settlement, an award of attorney’s fees to class counsel, and the provision of an incentive award for the class representative. The court affirmed in the face of objections to the class representative’s Article III standing, the notice pursuant to Rule 23(h), the award of attorney’s fees, and the incentive award to the class representative. The basic background is as ... Keep Reading »
Tenth Circuit Finds Plaintiffs’ Settle and Dismiss Strategy Unappealing
Following Supreme Court precedent, the Tenth Circuit recently held that plaintiffs’ settlement and voluntary dismissal of their claims did not transform the court’s interlocutory order denying class certification into a final, appealable order under 28 U.S.C. § 1291. Plaintiff trusts brought a putative class action against an energy company, alleging various claims related to royalty interests under gas leases, and sought to certify a class. The district court denied ... Keep Reading »
Volkswagen Passes Fairness Test for Class Settlement in Dispute Over “Defeat Devices” to Bypass Emission Tests
Last month the Ninth Circuit affirmed a district court decision approving a class settlement regarding Volkwagen’s marketing of clean diesel vehicles that used so-called “defeat devices” to circumvent emissions tests. Hundreds of “defeat device” lawsuits against Volkswagen were consolidated in the Northern District of California for pretrial proceedings. The proposed settlement provided over $10 billion in potential damages and class members’ recovery depended on whether ... Keep Reading »
Seventh Circuit Approves Cy Pres Settlement
We previously reported on the uncertainty of cy pres settlements in class action lawsuits. Although the Supreme Court granted cert on the issue, the Seventh Circuit weighed in during the interim by approving a settlement that included a potential payout to cy pres recipients. The case arose out of a million phone calls made to consumers throughout 2011 and 2012 in which people were offered a chance to go on a free cruise if they agreed to participate in a political ... Keep Reading »
Are Administrative Fees and Costs a Benefit to the Class as a Whole? A Circuit Split Continues
In 2017, the Eighth Circuit reversed the certification of a settlement class in the Target 2013 security breach litigation. See In re Target Corp. Customer Data Sec. Breach Litig., 847 F.3d 608, 613 (8th Cir. 2017). The court remanded the case to the district court to conduct a proper class certification analysis. On remand, the district court again certified the settlement class. A second appeal was taken by two objectors and, this time, the Eighth Circuit affirmed the ... Keep Reading »
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