“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”)]
Posts Tagged ‘Ted Frank’
Class action roundup
- Whichever way high court rules in Hood v. AU Optronics, new Fifth Circuit decision will fuel parens patriae actions by AGs in state courts [Alison Frankel, earlier]
- Justice Alito blasts federal district judge Harold Baer for insisting on race quotas for class action lawyers [Michael Greve/Liberty Law, Tom Goldstein/SCOTUSBlog]
- “Unfortunately, even if SCOTUS does away with fraud on the market, plaintiff lawyers will still bring omission cases” [Bainbridge, earlier]
- Ted Frank’s adventures, as documented at Point of Law [Pampers Dry Max (earlier), L’Oreal salon hair products, Korean Air, Wyeth]
- Does it cost too much to provide class action defendants with due process? [Andrew Trask] Related on Mark Moller’s work [same] Should class actions be understood as creating trusts? [same]
- Avery v. State Farm billion-dollar aftermarket-parts class action seeks RICO resuscitation, in Monty Python echo [Chamber-backed Madison County Record]
- If you didn’t know distinguished proceduralist Arthur Miller as a Milbergian, you might detect it from his writing [Trask]
Supreme Court asked to review cy pres settlements
We have often reported on controversies over cy pres class action settlements, in which part or all of a settlement fund goes to charities, universities, advocacy groups, or other unrelated institutions as opposed to actual victims of the sued-over conduct. Most appeals courts have agreed that cy pres raises distinctive issues that call for judicial oversight, yet the various federal circuits have marched off in different directions as to the appropriate nature and extent of such oversight, leading to inconsistency at least, and perhaps also to forum-shopping by lawyers seeking lenient standards.
Now figures well known to many of our readers — Ted Frank of the Center for Class Action Fairness, and David Rifkin and Andrew Grossman of Baker & Hostetler — have petitioned the Supreme Court for certiorari in a case arising from a privacy suit against Facebook over its Beacon program that eventuated in a cy pres settlement. “More than $6 million of [the] money was directed to the establishment of a new Internet privacy foundation with an advisory board that includes a Facebook representative and a plaintiffs’ lawyer from the case.” [Alison Frankel; Ted Frank/PoL; CCAF] Related: the “real problem with cy pres has never been that it is too costly. The real problem is that it creates an incentive for class counsel to act against the interests of the class.” [Andrew Trask]
Class action roundup
- Judge Alsup “shopping for new plaintiffs lawyers” for class action against Wells Fargo “because he isn’t happy with the team that brought suit”
[Recorder] - “Sixth Circuit Rejects Class Settlement in Pampers Case” [Adler] More: William Peacock, FindLaw (“something stinks”)
- Supreme Court to decide whether quasi-class-actions spearheaded by state attorneys general (“parens patriae”) can dodge CAFA’s mandate of removal to federal court [Deborah Renner, WLF]
- Channeling Google settlement funds to the Google-favored Lawrence Lessig center at Stanford is already a dubious use of cy pres, but thanking the lawyers makes it worse [Ted Frank]
- “Class actions ending in ‘ridiculous results’ continue to plague California, critics say” [Legal NewsLine]
- Big Ninth Circuit win for Ted Frank big win in inkjet coupon class action [Recorder, PoL, more]
- “Sixth Circuit Can’t Take A Hint From SCOTUS, Reinstates Whirlpool Smelly-Washer Case” [Daniel Fisher; earlier on Sears v. Butler, Business Roundtable; PoL, Fisher and our coverage]
Big Ted Frank victory on attorney fee markups
Longtime Overlawyered blogger Ted Frank just saved class members more than $25 million in a case in which his Center for Class Action Fairness had objected to the attorneys’ fee request in a settlement against Citigroup. Ted argued that the plaintiff’s lawyers were marking up to associate-level rates, at $400/hour or more, the work of contract attorneys who were being paid $50/hour or less for document review and similar tasks. Accepting the critique in part, the “order by U.S. District Judge Sidney Stein in New York cut the fee award to Kirby McInerney by $26.7 million to $70.8 million.” [Daniel Fisher/Forbes, WSJ, Point of Law and more]
Class action roundup
- “David Marcus on The History of the Modern Class Action” [Andrew Trask]
- Ted Frank profiled [American Lawyer] Related: “Expert in legal-fee fight blasts ‘make believe’ game over cost of contract lawyers to do doc review” [ABA Journal; CCAF on games case]
- “Statutory Penalties and Class Actions: Social Justice or Legalized Extortion?” [Paul Karlsgodt, DULR Online]
- Lawyers in Ford Explorer case claimed $500M benefit to class, on way to pocketing $25M fee; actual coupon redemptions $74,000 [Lawrence Schonbrun, American Thinker]
- Genesis Health Care Corp. v. Symczyk: can defendant moot class action by settling lead plaintiff’s complaint? [Karlsgodt, Trask, Fed Soc]
- Incentive problems of cy pres: a mini-roundup [Jennifer Johnston comment, JLEP, via Trask, Alison Frankel/Reuters on Ben & Jerry’s case, PoL on U. of South Carolina, Daniel Fisher on Facebook case]
- Reactions to SCOTUS ruling in Comcast v. Behrend [Richard Epstein, Point of Law; Max Kennerly with a plaintiff’s view; Fed Soc podcast with Ken Lee (Jenner & Block); Manhattan Institute podcast with Ted Frank]
March 18 roundup
- Justice done in Tewksbury, Mass. as feds won’t appeal loss in Motel Caswell forfeiture case [Institute for Justice]
- Oh, FTC: “Government Now Says Tweets Have To Include ‘The Fine Print'” [Business Insider]
- Judge lifts “no Facebook posts” order against class action objector [Paul Alan Levy, ABA Journal, earlier]
- House Judiciary Committee hearing on litigation abuse feature Ted Frank, John Beisner [link to video, Chamber-backed LNL]
- Update: minister who aided Miller-Jenkins custody-napping gets 27 month sentence [AP,earlier]
- Pennsylvania high court judge convicted on charges of using state staff for campaign [AP] Also in Pa., wife/chief aide of high court justice “has received 18 payments as referral fees for connecting law firms with clients” [Philadelphia Inquirer] “Arkansas Supreme Court Justice reports $50k gift from plaintiff lawyer” [LNL]
- Widow sues church for refusal to accept NASCAR-themed cemetery headstone [IndyStar]
Groupon customer “remedy”
It may be worse than before class action lawyers got involved, argues Ted Frank [Point of Law]
Victories for Ted Frank’s Center for Class Action Fairness
Ted’s successful 7th Circuit objection in June in a Sears shareholder class action (Easterbrook: “The only goal of this suit appears to be fees for the plaintiffs’ lawyers”), which raised widespread discussion, is just one in a string of wins for his Center for Class Action Fairness in recent months. In a settlement involving complaints against Classmates.com, the judge agreed with the arguments of CCAF client (and George Mason lawprof) Michael Krauss, rapped class counsel’s knuckles with a $100,000 sanction for discovery tactics that amounted to harassment (see section III-D), and ordered a better deal for class members [PoL] And in yet another noteworthy case: “The Third Circuit Court of Appeals has rejected a settlement of a class action over potentially leaky Volkswagen sunroofs that would have paid the lawyers who negotiated it $9.2 million in fees and the majority of car owners nothing.” [Daniel Fisher/Forbes, Ted at PoL, earlier]
July 25 roundup
- Town of Gold Bar, Wash. (pop. 2,100) brought to brink of bankruptcy by multiple lawsuits following political feuds; “We are going broke winning lawsuits,” says mayor [Monroe Monitor via ABA Journal]
- “No one in Youngstown Ohio has a Swiss bank account…except maybe that big new Swiss employer in town?” [Matt Welch, earlier] William McGurn: FATCA and the IRS’s reach abroad [WSJ via TaxProf, earlier here, here] Politicians and lawyers demand “improvements” to IRS bounty-paid-informant program, but what if anything they improve may depend on your point of view [TaxProf, earlier]
- A human rights professor endorses a new model of residential facility that comes with names like “Freedom Place.” But what’s that on the door — could it be a lock to prevent escape? [Maggie McNeill] Romney spokesman says he’ll smite smut, Gov. Gary Johnson takes a more libertarian view [Daily Caller]
- New Mark Herrmann book on in-house lawyering [Victoria Pynchon, Scott Greenfield, Paul Karlsgodt]
- Mortgage eminent-domain seizure plan raises serious constitutional concerns [Andrew Grossman, earlier here, here]
- Central casting? Send over one “business basher,” please: Sidney Wolfe says $3 billion Glaxo settlement too lenient [CL&P, earlier]
- Ted Frank pre-vets the possibilities for Romney VP [PoL] Romney’s law and legal policy team [Brian Baxter, AmLaw Daily]