I don’t know if my question was partly rhetorical or wholly in earnest. Let’s try to figure that out.

I’ll start with coupon settlements. In billb, for example, we seemingly have someone who frequently finds himself in coupon settlement classes, and who is quite capable of putting substantial energy into composing articulate posts on the web discussing what he perceives as their demerits. I don’t certainly don’t fault him for that. Public debate is a good thing, and maybe billb feels it’s a more effective vehicle than filing objections would be. Or maybe he just views litigation, or some particular kinds of litigation, with distaste, and doesn’t want to involve himself with it.

But I’ve seen *enough* posts on the web by disgruntled coupon-class members — many of those posts the product of substantial effort and art — that I have to wonder why more of that energy isn’t channeled into objecting. One well-crafted objection can make some judges think twice. Even if the judge approves the settlement anyway, the objection may spark the judge to exert his or her influence to move the settlement terms in a more consumer-friendly direction. I don’t say that’s necessarily a likelihood. But if no one ever objects, how are judges to know that anyone objects? In my experience, judges mostly try to be conscientious. But that rubber stamp presumably starts to look more tempting, if no one has shown any sign of giving a hoot.

Meanwhile, departing now from the coupon context, I wonder the following about consumer class actions where the individual class members’ returns are low. I wonder if there isn’t something resembling a marketplace logic at work here. If class members don’t feel it’s worth the time to opt out or object then maybe that’s a rational assessment, given what they perceive as their very low stakes in the matter. If that’s so, then what’s the harm, exactly, in a settlement that makes a culpable defendant pay, thereby encouraging adherence to law, and which also compensates the lawyers who spent time, when nobody else felt it was worth their trouble, to bring the culpable party to account? To me, that all sounds like a salutary check on commercial misbehavior in connection with transactions too small to find other paths to the civil justice system.

You weren’t saying the contrary, of course. But the contrary is sometimes said.

Regards,

Peter

First, given its format, few people are even likely to take the time to read the notice of proposed settlement, let alone to get to the part which describes the procedure for objecting.

Second, individual consumers don’t have much incentive to object; individual recoveries are often so small (that is, after all, one of the justifications for class action in the first place) as to make it not worth anybody’s time, and the difference between a “good” settlement and a “bad” one is even smaller.

Third, there’s not a lot of point, because, despite all the public complaints over bad settlements, most judges rubber stamp them, regardless of objections. No judge wants to send class counsel and defendants back to the drawing board by the time the fairness hearing takes place.

So who objects? A couple of individual cranks, and professional objectors. Judges don’t give much credence to either.

I’m not with you on the proposition that “any burden” is “too much.” The law strikes all sorts of balances between the competing interests of different parties. These comments are not a context in which a full-throated defense of class actions is possible, but among other justifications for them, they do often make it possible to prosecute claims for real wrongs in situations where individual suits would not be economically viable. That’s a legitimate interest that should weigh in the balance — enough of one by itself, in my view, to justify the relatively minimal burden of opting out.

It may be that notice is sometimes deficient in practice (a circumstance that can sometimes relieve a class member from the binding effect of the judgment). But for that, it seems to me the obvious first remedy of choice would be better notice.

So, the effort is often somewhat more than minimal. One has to know about the class (in time), find the website or phone number to call to opt out, and then send a letter or fill out the form. Plus, if the US Mail is involved, one has to pay for the envelope and stamp! Admittedly, that’s all likely to be a pretty small burden, but it seems like any burden to prevent someone from representing you is too much. This is especially true when you not only believe that the settlement is silly but believe that it is actively harmful or at least against good publicy policy (e.g I’m firmly against settlements that give the plaintiffs more of the defendant’s products. That’s just nonsensical.).

What the Supreme Court hasn’t done, so far as I know, is hold in clear fashion that the right of association directly applies, in any full-blooded way, to attorney-client relationships in civil litigation. If it did, then all manner of fascinating questions might arise, up to and including the constitutionality of attorney licensure. (Full disclosure: Over twenty years ago, I published a law review piece suggesting that such a holding is implicit in such decisions as NAACP v. Button, and that attorney licensure is constitutionally suspect on that ground. See Comment, The Petition Clause and Unauthorized Practice Rules, 132 U. Pa. L. Rev. 1515 (1984). But for some reason my arguments haven’t caught on.)

In class cases under Rule 23(b)(3), the question doesn’t really seem implicated, because the rules do give the class member an opportunity to opt out with only very minimal effort (mailing back the opt-out form). As suggested in my first comment, existing rules and legal doctrines do meanwhile afford class members substantial opportunities to assert their rights and protect their interests. These typically include not only the rights to opt out and to object to a settlement, but also the right to bring a separate suit of one’s own notwithstanding the pendency of the class claims. If class members do none of these things, they still have the right, of course, to refrain from cashing the settlement check.

Not much.

Actually, the part that I find most disturbing is that it is essentially like those old credit card offers (they gave you a card without your permission, and you had to cancel the account) that were judged to be so abusable… oh, look! Class actions get abused, too. How very surprising.

re why not more objections: I’ve “been a class member” in half a dozen or so class action suits. In all of these cases I’ve: a) not been interested in the settlement (usually because it’s some stupid coupon to buy a product from a company I’ll never do business with again), and b) had no interest in actually suing the the defendant myself because my losses were so small as to generally be laughable. Given that, the effort required to opt out (even if all I have to do is go fill out a form on a website) is generally not worth it just to uphold my position on principles.

That being said, it still bothers me in my heart of hearts that I’ve been represented in court without specifically asking to be. It seems to me that I should not have to take affirmative steps to not have my free association rights infringed. (OK, maybe that’s overstating things a bit 🙂

As for the question about class membership, the long established approach is that you are in unless you optout. There are arguments for “optin” classes, but that is not the present law. The “law” is basically Rule 23, Federal Rules of Civil Procedure and state counterparts.

Meanwhile, I’m a plaintiffs’ class action lawyer myself, but I’m not a big fan of coupon settlements. They may be appropriate in some circumstances, but there’s a greater than usual potential, with coupon settlements, that the settlement will better serve the interests of the lawyers and the defendants than it will those of the class.

It bears remarking, though, that the courts are required to approve any class action settlement, and the rules do provide that class members must receive notice of the settlement, which generally includes notice of the right to object to it. The question that needs asking may be why such objections are not more common.

When did explicit rejection of class membership become an enforcable part of class-action settlements? Why doesn’t acceptance of the award/benefit from the settlement constitute joining the class with the default being non-membership?

I seek answers from a legal perspective not the obvious benefit to class plaintiffs’ attorneys. I.e., is there case law or statute that enables the status quo?