The Eleventh Circuit recently imparted an important message to the class action bar, and in particular to attorneys representing different named plaintiffs in competing class actions: there is “only one gatekeeper under Rule 23,” so any challenge to a proposed class action settlement should be presented to the district judge deciding whether to approve that settlement, not to a different judge by way of a collateral attack on the proposed settlement. Several years ... Keep Reading »
Class Action Settlement Articles
The latest class action settlement developments and trends, including news, key cases, and strategies.
A Class Action Settlement With a Chocolate Company Melts Away: Eleventh Circuit Issues En Banc Decision on Article III Standing Principles
On October 28, 2020, the Eleventh Circuit Court of Appeals issued a split (7-3) en banc decision applying Spokeo principles to a claim that a vendor issued a receipt that included more digits from the plaintiff’s credit card than allowed by federal law. The en banc court ruled that the plaintiff did not establish Article III standing. As I reported two years ago after the panel’s decision, the basic background is as follows. This class action lawsuit alleged ... Keep Reading »
An Unauthorized Bounty: Eleventh Circuit Strikes Named Plaintiff Incentive Payment
This week, an Eleventh Circuit panel, in a 2-1 decision, reversed the approval of an incentive payment to the named plaintiff, calling the payment an unauthorized bounty. The case involved a Telephone Consumer Protection Act (TCPA) class action settlement that the majority characterized as being "just like so many others that have come before it." But this familiarity was "exactly the problem." According to the court, the district court "repeated several errors that, ... Keep Reading »
Considerable Deference With a Caveat: Third Circuit Addresses Fee Awards
The Third Circuit Court of Appeals recently issued a decision regarding the fee award in the National Football League concussion injury litigation. The decision is non-precedential but still instructive. One takeaway is that appellate courts will show “considerable deference” to district court fee awards. The other takeaway, however, is that district courts still must provide enough of an explanation for appellate courts to meaningfully review the award. When they do ... Keep Reading »
Take Notice: FTC Reports on Claims Rates and Settlement Notices
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 »
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 »
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