- “American Express Settlement Collapses Amid Charges Of Collusion” [Daniel Fisher]
- Some on Capitol Hill would like U.S. Treasury to return money seized from South Mountain Creamery in now-notorious structuring case [Washington Post, our earlier coverage]
- CEO pay shaming theory has been tried and failed twice, but why not one more try? [Marc Hodak, earlier]
- Another big courtroom reverse for SEC in use of in-house administrative law judges [Reuters]
- Judge Easterbrook on competitive federalism, Delaware, and incorporation [Robert Goddard, Corporate Law and Governance quoting Corre Opportunities Fund, LP v. Emmis Communications Corp.]
- How far will California go to tax one wealthy ex-resident? Consider saga of Gilbert Hyatt vs. Franchise Tax Board [Lloyd Billingsley, Daily Caller]
- Apparently so: “Is Securities Litigation’s Future Secure?” [Nick Goseland, Above the Law]
“Only two of the estimated 232,000 class members claimed the coupons” in a class action led by Edelson McGuire LLP. Defendant Dick’s Sporting Goods “agreed not to oppose the plaintiff’s request for $210,000 in attorney fees and costs and a $3,500 incentive award,” but an Orange County, Calif. judge took away a large chunk of that sum because… why? Because some of the lawyers angling for it had not been admitted to practice in California, that’s why. [Kenneth Ofgang, Metropolitan News-Enterprise; Golba v. Dick’s Sporting Goods, unpublished]
- “Lawyers Won 10x Fee Payoff By Avoiding Competition, Objector Claims” [Daniel Fisher, Center for Class Action Fairness on Capital One TCPA settlement]
- DMCA surprise: “Automakers are supporting provisions in copyright law that could prohibit home mechanics and car enthusiasts from repairing and modifying their own vehicles.” [Mike Masnick, TechDirt; Pete Bigelow, AutoBlog]
- Comments deadline May 19 on proposed Indian Child Welfare Act regulations; American Academy of Adoption Attorneys files comments warning they go beyond statute, will harm kids [related group, earlier and general]
- Asbestos lawsuits are “economic engine” of rural Edwardsville, Ill. [Associated Press]
- Chicago pays damages to victims of police torture, suggestively labeled “reparations” [Sandhya Somashekhar, Washington Post, thanks for quote]
- Court dismisses pro se litigant’s handwritten “God v. gays” complaint for lack of basis for federal jurisdiction, other predictable deficiencies [Volokh, Lowering the Bar and followup]
- “Starbucks not liable in police coffee-spill case, jury decides” [WRAL, earlier]
The Target Corporation’s settlement of class action litigation over a major consumer data security breach is not as groundbreaking as all that, and in particular falls far short of the enormous liability payouts that were being talked of for a while [Paul Karlsgodt; Minnesota Public Radio] It does however feature attorney’s fee payouts “not to exceed $6.75 million, which is on the high end of the historical range” [Paul Bond, Lisa Kim, and Christine Czuprynski, Reed Smith] Earlier here. More: Randy Maniloff, Minneapolis Star-Tribune.
“Judge Richard Posner of the Seventh Circuit Court of Appeals has unleashed another zinger at class-action attorneys, trashing a settlement over joint-pain pills that would have paid attorneys $2 million in fees, more than double what their clients got.” [Daniel Fisher, Forbes, whose own writing gets cited; opinion in Pearson v. NBTY] From the ABA Journal:
The opinion was a victory for Ted Frank of the Center for Class Action Fairness, who objected to the settlement as a class member. He told the Am Law Litigation Daily he will be citing the case in new objections to class-action settlements. So far, he says, his group has persuaded courts to wipe out $271 million in attorney fees in the 39 cases in which the center achieved some success.
“This is the best opinion out there” on class settlement issues, Frank told the Litigation Daily. “I think it will have a dramatic effect on class action settlements negotiated.”
- NYC pols, hotel interests unite in the cause of suppressing AirBnB [CNBC, Matthew Feeney/Cato, more, NY mag]
- David Bernstein on Justice Sotomayor’s dissent in Schuette, the Michigan affirmative action case [Cato Supreme Court Review via Volokh Conspiracy, and thanks for quoting my views]
- Restaurant’s amusing response to “do you know I’m a lawyer?” [Above the Law]
- Cronyism in city governance: its enablers, consequences and possible cures [Aaron Renn, Urbanophile, first, second, third, fourth posts; Lincoln Steffens, 1905, on the evils of Rhode Island]
- N.J. toll-taker’s suit: it’s my right to tell motorists “God bless you” whether turnpike authority likes it or not [AP/CBS New York]
- “Q: What has worse terms than gym memberships and class action settlements? A: This class action over gym memberships.” [Center for Class Action Fairness on Twitter]
- US border security great at keeping out bagpipes and Kinder Eggs, not so great at keeping out Ebola [Mark Steyn, more Steyn on bagpipes and earlier on musical instrument confiscations here, here, etc.]
- Posner smacks lawyers, vindicates objectors in Radio Shack coupon settlement [CCAF, Fisher, more]
- “Germany To Consider Ban On Late-Night Work Emails” [Alexander Kaufman, Huffington Post]
- 7th Circuit overturns Wisconsin John Doe ruling, sends back to state judges [Milwaukee Journal-Sentinel, ruling; more, Vox] John Doe case prosecutor John Chisholm, via columnist Dan Bice, strikes back against source in office who talked to Stuart Taylor, Jr. [Taylor, Althouse]
- Trial lawyer/massive Democratic donor Steve Mostyn also dabbles in Texas Republican primaries [Robert T. Garrett, Dallas Morning News; Mostyn’s national spending from Florida and Arizona to New Hampshire and Minnesota]
- Sad: immigration lawyer known for Iraqi Christian advocacy faces asylum fraud charges [Chicago Tribune]
- Might have been entertaining had Bruce Braley opponent Joni Ernst in Iowa argued in favor of nullification, but that’s not what evidence shows [Ramesh Ponnuru]
- California hobbles insurers with diverse-procurement regulations [Ian Adams, Insurance Journal]
“A federal appeals court has rejected an ‘inequitable — even scandalous’ class-action settlement, removed the lead lawyer and reinstated ‘defrocked’ lead plaintiffs who had objected to the deal.” The ruling, involving a class action against the Pella Corp., window manufacturers, is another triumph for Ted Frank, former contributor to this blog and now a prominent objector through his Center for Class Action Fairness. [ABA Journal, Chicago Daily Law Bulletin (“attorneys would receive $11 million in fees while their clients would get, at most, $8.5 million — and likely much less”)]
Information hardly ever gets onto the public record about what percentage of notional claims are actually redeemed following a class action settlement, which means there’s generally no way to evaluate participants’ forecasts of robust redemption rates (these forecasts help support not only large fee requests by lawyers in the case at hand, but also the general repute of the class action mechanism as one with genuine benefits for class members — the “consumers win $30 million” sorts of headlines). One class of people who do know a lot about this question are settlement administrators, those who manage the mostly obscure private firms set up to handle payout requests as they come in. But they don’t talk to the press.
That’s why a declaration submitted last month in a false-labeling class action involving Duracell batteries is so tantalizing. … defense lawyers at Jones Day submitted a declaration from Deborah McComb, a senior consultant at Kurtzman Carson Consultants, a settlement administrator. KCC is administering the Duracell settlement, and the point of McComb’s declaration is that the rate of claims in this case is consistent with what KCC typically sees in similar settlements that have received final approval.
McComb provides some hard numbers to support the point — and this is why the declaration is significant. KCC, she said, has administered hundreds of consumer class actions in which class members received notice indirectly rather than directly through the mail. These cases “will almost always have a claims rate of less than 1 percent,” she said.
In fact, the “median claims rate for cases in the KCC analysis” was .023 percent, far lower than 1 percent. The Duracell settlement was said to be worth $49 million, including a stated $6 million to charity, but the amount headed to class members was likely going to come in below $345,000. Class actions with mail notice to class members may perform somewhat better — it’s hard to know how much so — but these revelations tend to back up reformers’ belief that where dollar amounts per claimants are not large enough to justify the time and trouble of redemption, the great majority of redistribution will go on for the benefit of lawyers and other middlemen. [Alison Frankel, Reuters; Daniel Fisher, Forbes]