Combating Class Settlement Objectors: Overview of Proposed Rule - - PowerPoint PPT Presentation

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Combating Class Settlement Objectors: Overview of Proposed Rule - - PowerPoint PPT Presentation

Presenting a live 90-minute webinar with interactive Q&A Combating Class Settlement Objectors: Overview of Proposed Rule Amendments, Key Preventive Measures and Tactics Minimizing and Defending Against Challenges by Professional Objectors,


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Presenting a live 90-minute webinar with interactive Q&A

Combating Class Settlement Objectors: Overview of Proposed Rule Amendments, Key Preventive Measures and Tactics

Minimizing and Defending Against Challenges by Professional Objectors, Government Officials, and Public Interest Groups

THURSDAY, SEPTEMBER 29, 2016

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Today’s faculty features:

1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific

Ross Good, Esq., Anderson + Wanca, Rolling Meadows, Ill. Andrew J. Trask, Senior Counsel, McGuire Woods, Los Angeles

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SLIDE 3

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Professional Objectors

www.serialobjector.com

Professional Objectors

www.serialobjector.com

By Ross Good Anderson + Wanca rgood@andersonwanca.com

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Section I. Professional Objectors

 Objections to class action lawsuits can serve a legitimate purpose, but they also allow an individual to hold up class- wide settlements.  Often the goal for a Professional Objector is to lose at the final approval stage while preserving the ability to appeal. This enables the Professional Objector to bargain for money by threatening to delay the appeals process for as long as possible.  Professional Objectors typically attempt to get a confidential payoff after their Notice of Appeal is filed but before doing substantive work on the appeal.  www.serialobjector.com  Most Professional Objectors are fairly transparent about their motivation to obtain a confidential payoff outside the courtroom.  Objections to class action lawsuits can serve a legitimate purpose, but they also allow an individual to hold up class- wide settlements.  Often the goal for a Professional Objector is to lose at the final approval stage while preserving the ability to appeal. This enables the Professional Objector to bargain for money by threatening to delay the appeals process for as long as possible.  Professional Objectors typically attempt to get a confidential payoff after their Notice of Appeal is filed but before doing substantive work on the appeal.  www.serialobjector.com  Most Professional Objectors are fairly transparent about their motivation to obtain a confidential payoff outside the courtroom.

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Best Practices on Handling Professional Objectors

 Be proactive regarding the content of class notice

 Disclosure of documentation evidencing membership of the

  • bjector in the proposed class

 Disclosure of all previous objections  In-person appearance of objector/counsel at Final Approval Hearing

 Background research using PACER, WestLaw/Lexis, and www.serialobjector.com  Do the discovery:

 Get all retainer agreements  Depose objectors

 Filings to Consider

 Motion to Strike  Appeal Bond  Expedited Appeal

 DO NOT PAY!  Be proactive regarding the content of class notice

 Disclosure of documentation evidencing membership of the

  • bjector in the proposed class

 Disclosure of all previous objections  In-person appearance of objector/counsel at Final Approval Hearing

 Background research using PACER, WestLaw/Lexis, and www.serialobjector.com  Do the discovery:

 Get all retainer agreements  Depose objectors

 Filings to Consider

 Motion to Strike  Appeal Bond  Expedited Appeal

 DO NOT PAY!

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Retainer Agreements

 The snapshot above is part of the retainer agreement between attorney Kirk Kennedy and A7 Realty LP d/b/a Austin Distributing Company for its objection to the

  • bjection in Fauley v MetLife (Cir. Ct. Lake Co., IL, 14 CH

1518).  Rule 5.4 of Illinois Rules of Professional Conduct states that “[a] A lawyer or law firm shall not share legal fees with a nonlawyer”  Documentation of unethical agreements can be used to support final approval of the settlement, appeal bonds and expediting appeals.  Retainer agreements that violate the forum state’s Rules of Professional Conduct should be reported to the forum state’s attorney disciplinary commission.  The snapshot above is part of the retainer agreement between attorney Kirk Kennedy and A7 Realty LP d/b/a Austin Distributing Company for its objection to the

  • bjection in Fauley v MetLife (Cir. Ct. Lake Co., IL, 14 CH

1518).  Rule 5.4 of Illinois Rules of Professional Conduct states that “[a] A lawyer or law firm shall not share legal fees with a nonlawyer”  Documentation of unethical agreements can be used to support final approval of the settlement, appeal bonds and expediting appeals.  Retainer agreements that violate the forum state’s Rules of Professional Conduct should be reported to the forum state’s attorney disciplinary commission.

The complete retainer agreement is available at http://www.serialobjector.com/cases/1

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Depositions of objectors

 Review past depositions of the objectors  Class Notice Questions  Settlement Questions  Retainer Agreement Questions  Marketing of attorney(s) for the objector being represented  Goals for the objection  Review past depositions of the objectors  Class Notice Questions  Settlement Questions  Retainer Agreement Questions  Marketing of attorney(s) for the objector being represented  Goals for the objection

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Appeal Bond

 FRAP Rule 7: “In a civil case, the district court may require an appellant to file a bond or provide other security in any form and amount necessary to ensure payment of costs on appeal.”  The bond is permissive  Research your judge  Use the discovery on the objector(s) to support your motion  Use objector’s past objections to support your motion  FRAP Rule 7: “In a civil case, the district court may require an appellant to file a bond or provide other security in any form and amount necessary to ensure payment of costs on appeal.”  The bond is permissive  Research your judge  Use the discovery on the objector(s) to support your motion  Use objector’s past objections to support your motion

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Case Study #1: In Re: Checking Account Overdraft Litigation (US District Court for S.D. FL, 09-md-02036)

 Objection of Kirk A. Kennedy (Kennedy) et al. Doc. 1920  Plaintiffs ask for appeal bond of $621,338 for all 49 timely objectors. Doc. 2335  Order Mandating Appeal Bond of $616,338 for all

  • bjectors to pay. Doc. 2473

 Notice of Appeal of Objector Kennedy filed on December 9, 2011 by Elliot B. Kula and Daniel M. Samson of Kula & Samson, LLP. Doc. 2208  Appeal of Objector Kennedy voluntarily dismissed on June 22, 2012.  Objection of Kirk A. Kennedy (Kennedy) et al. Doc. 1920  Plaintiffs ask for appeal bond of $621,338 for all 49 timely objectors. Doc. 2335  Order Mandating Appeal Bond of $616,338 for all

  • bjectors to pay. Doc. 2473

 Notice of Appeal of Objector Kennedy filed on December 9, 2011 by Elliot B. Kula and Daniel M. Samson of Kula & Samson, LLP. Doc. 2208  Appeal of Objector Kennedy voluntarily dismissed on June 22, 2012.

http://www.serialobjector.com/cases/7

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Case Study #1: Ancillary Proceeding: Sattiewhite and Kennedy v Kula & Samson (US District Court for S.D. FL, 12-cv-24178)

 According to Kennedy, a settlement was reached with class counsel on or about January 12, 2012. Doc. 128-3  Objectors Kennedy and Sattiewhite sue the attorneys representing them on appeal (Kula & Samson) for In Re: Checking Account Overdraft Litigation.  The settlement amount was $1,100,000 which was transferred to Kula & Samson’s Client Trust Account.

  • Doc. 102-8

 Kennedy claimed to have “an immediate right to at least 40% of that money.” Doc 128-3  Documents available in this case are ordinarily privileged  According to Kennedy, a settlement was reached with class counsel on or about January 12, 2012. Doc. 128-3  Objectors Kennedy and Sattiewhite sue the attorneys representing them on appeal (Kula & Samson) for In Re: Checking Account Overdraft Litigation.  The settlement amount was $1,100,000 which was transferred to Kula & Samson’s Client Trust Account.

  • Doc. 102-8

 Kennedy claimed to have “an immediate right to at least 40% of that money.” Doc 128-3  Documents available in this case are ordinarily privileged

All filings are available for download at no cost at http://www.serialobjector.com/cases/7 under Kennedy’s objection to In Re: Checking Account Overdraft Litigation. Click on the link for “Kennedy and Sattiewhite v. Kula & Samson.zip”

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Case Study # 2: Dennings v. Clearwire Corporation (US District Court for W.D. WA, 10-cv-01859)

 District Court grants Final Approval of Class Settlement on December 19, 2012. Doc. 98  Christopher A. Bandas filed Notice of Appeal on behalf of his clients on January 18, 2013. Doc 101.  District Court orders $41,150 appeal bond on March 11,

  • 2013. Doc. 117.

 9th Cir. Court of Appeals granted expedited appeal on April 22, 2013. Doc. 126.  9th Cir. Court of Appeals issued Order Denying Motion to Vacate Sanctions on July 26, 2013. Doc. 156.  On August 20, 2013 the District Court ruled that the appropriate sanction is to revoke Mr. Bandas' authorization to practice in the Western District of Washington. Doc. 166.  District Court grants Final Approval of Class Settlement on December 19, 2012. Doc. 98  Christopher A. Bandas filed Notice of Appeal on behalf of his clients on January 18, 2013. Doc 101.  District Court orders $41,150 appeal bond on March 11,

  • 2013. Doc. 117.

 9th Cir. Court of Appeals granted expedited appeal on April 22, 2013. Doc. 126.  9th Cir. Court of Appeals issued Order Denying Motion to Vacate Sanctions on July 26, 2013. Doc. 156.  On August 20, 2013 the District Court ruled that the appropriate sanction is to revoke Mr. Bandas' authorization to practice in the Western District of Washington. Doc. 166.

http://www.serialobjector.com/cases/57

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Case to Watch: Garber v. Commissioner of Baseball (US District Court for S.D. NY, 12-cv-03704)

 Motion for Sanctions against Bandas filed April 28, 2016.

  • Doc. 564

 Hearing held before Judge on July 14, 2016. Doc. 591  On August 12, 2016 Bandas’s attorneys filed memorandum on why Rule 11 sanctions should not be imposed on Bandas for representing the objector. Doc. 599  This is an ongoing case that may decide the issue of whether an attorney representing an objector without an appearance on file can be sanctioned.  Motion for Sanctions against Bandas filed April 28, 2016.

  • Doc. 564

 Hearing held before Judge on July 14, 2016. Doc. 591  On August 12, 2016 Bandas’s attorneys filed memorandum on why Rule 11 sanctions should not be imposed on Bandas for representing the objector. Doc. 599  This is an ongoing case that may decide the issue of whether an attorney representing an objector without an appearance on file can be sanctioned.

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Dr Jekyll and Mr Hyde: The Ted Frank Story

 Ted Frank is the founder and president of the Competitive Enterprise Institute’s (CEI’s) Center for Class Action Fairness (CCAF). CCAF is a 501(c)(3) organization.

 CCAF files objections to class action settlements it thinks are unfair. CCAF is open and transparent regarding the objections CCAF files and the results it obtains.  According to Ted Frank, his annual pay from CCAF is $199,200. See Declaration of Theodore H. Frank, In re Capital One, 7th Cir Ct. of Appeals, 15-1490, Doc. 56-2 Page 22.  Saltzman v Pella (U.S. Dist. Ct. for N.D. IL, 06-cv-04481) is available at https://www.serialobjector.com/cases/150 - My firm worked with Ted Frank on

  • bjections to the settlement which ultimately led to the 7th Cir. overturning the

settlement.

 In the past, Ted Frank has also performed work for professional objectors independent of CCAF:

 According to Ted Frank, he grossed about $253,000 from Bandas between 2013 and 2015 ”…and incurred about $32,000 of expenses on contract attorneys…” See Declaration of Theodore H. Frank, In re Capital One, 7th Cir Court of Appeals, 15- 1490, Doc. 56-2 Page 22. The website serialobjector.com has identified some of these cases including:

 Fauley v. Metropolitan Life (Cir. Ct. of Lake Co., IL, 14 CH 1518): On June 29, 2015, Ted Frank said that he never made an appearance in this case nor is he working on this case now. https://www.serialobjector.com/cases/1  Fladell v. Wells Fargo Bank (US Dist. Ct. for S.D. FL, 13-cv-60721) is available at https://www.serialobjector.com/cases/49  In re Certainteed Fiber Cement Siding Litigation (US Dist. Ct. for E.D. PA, 11-md-02270) is available at https://www.serialobjector.com/cases/129  In re Capital One Telephone Consumer Protection Act Litigation (US Dist. Ct. for N.D. IL, 12- cv-10064) and ancillary proceeding Chrisotpher A. Bandas v. Ted Frank (Nueces County, TX Dist Ct. 2015DCV-2704-A) is available at https://www.serialobjector.com/cases/10

 Ted Frank is the founder and president of the Competitive Enterprise Institute’s (CEI’s) Center for Class Action Fairness (CCAF). CCAF is a 501(c)(3) organization.

 CCAF files objections to class action settlements it thinks are unfair. CCAF is open and transparent regarding the objections CCAF files and the results it obtains.  According to Ted Frank, his annual pay from CCAF is $199,200. See Declaration of Theodore H. Frank, In re Capital One, 7th Cir Ct. of Appeals, 15-1490, Doc. 56-2 Page 22.  Saltzman v Pella (U.S. Dist. Ct. for N.D. IL, 06-cv-04481) is available at https://www.serialobjector.com/cases/150 - My firm worked with Ted Frank on

  • bjections to the settlement which ultimately led to the 7th Cir. overturning the

settlement.

 In the past, Ted Frank has also performed work for professional objectors independent of CCAF:

 According to Ted Frank, he grossed about $253,000 from Bandas between 2013 and 2015 ”…and incurred about $32,000 of expenses on contract attorneys…” See Declaration of Theodore H. Frank, In re Capital One, 7th Cir Court of Appeals, 15- 1490, Doc. 56-2 Page 22. The website serialobjector.com has identified some of these cases including:

 Fauley v. Metropolitan Life (Cir. Ct. of Lake Co., IL, 14 CH 1518): On June 29, 2015, Ted Frank said that he never made an appearance in this case nor is he working on this case now. https://www.serialobjector.com/cases/1  Fladell v. Wells Fargo Bank (US Dist. Ct. for S.D. FL, 13-cv-60721) is available at https://www.serialobjector.com/cases/49  In re Certainteed Fiber Cement Siding Litigation (US Dist. Ct. for E.D. PA, 11-md-02270) is available at https://www.serialobjector.com/cases/129  In re Capital One Telephone Consumer Protection Act Litigation (US Dist. Ct. for N.D. IL, 12- cv-10064) and ancillary proceeding Chrisotpher A. Bandas v. Ted Frank (Nueces County, TX Dist Ct. 2015DCV-2704-A) is available at https://www.serialobjector.com/cases/10 15

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Serial Objector Index www.serialobjector.com

 This website seeks to identify attorneys and individuals who repeatedly hold up settlements by objecting and appealing, often in the hopes of receiving confidential payoffs in exchange for dropping their objections.  Objectors  Signers  Attorneys  Documents available for download  This website seeks to identify attorneys and individuals who repeatedly hold up settlements by objecting and appealing, often in the hopes of receiving confidential payoffs in exchange for dropping their objections.  Objectors  Signers  Attorneys  Documents available for download

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Section II. Governmental Objectors

 CAFA Notice  Heightened scrutiny under CAFA for coupon settlements  Figueroa v. Sharper Image Corp., 517 F.Supp.2d 1292 (US District Court for S.D. FL, 2005-cv-21251): “What distinguishes this case from other class actions, however, is the singular appearance of the Attorneys General of thirty-five states and the District of Columbia, representing hundreds of thousands, if not millions, of eligible class members.”  CAFA Notice  Heightened scrutiny under CAFA for coupon settlements  Figueroa v. Sharper Image Corp., 517 F.Supp.2d 1292 (US District Court for S.D. FL, 2005-cv-21251): “What distinguishes this case from other class actions, however, is the singular appearance of the Attorneys General of thirty-five states and the District of Columbia, representing hundreds of thousands, if not millions, of eligible class members.”

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Click to edit Master title style Combatting Class Settlement Objectors

www.mcguirewoods.com

Click to edit Master title style

www.mcguirewoods.com

Andrew Trask, Senior Counsel atrask@mcguirewoods.com

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III – Public Interest Group Objections

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The Boogeyman

  • Ted Frank, Center for Class Action

Fairness (CCAF)

– “[A]mong class action lawyers' most feared objectors.” - Alison Frankel, Reuters

  • Representative cases

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  • Representative cases

– Jones v. GM Netcom, Inc., 654 F.3d 935 (9th Cir. 2011) (reverses settlement, court must look for signs of collusion). – In re Dry Max Pampers Litig., 724 F.3d 713, 715 (6th Cir. 2013)(vacates settlement; counsel was overpaid; class received worthless injunctive relief) – Redman v. Radio Shack Corp.,768 F.3d 622 (7th Cir. 2014) (vacates coupon settlement).

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Basics on Public-Interest Objectors

  • Nonprofit entities

– Harder to buy off or deter

  • Tend to object on principle

– i.e., are concerned about specific violations or outcomes – Want to change the law

  • Usually transparent about criteria

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  • Usually transparent about criteria

– High fees compared to class payout – Coupons (e.g., Feder v. Frank, 2013 U.S. App. LEXIS 9744 (9th Cir. May 15, 2013).) – Misuse of cy pres

  • Have strong ethos-based arguments

– “[O]bjectors play an essential role in judicial review of proposed settlements

  • f class actions … .” Pearson v. NBTY,

Inc., 772 F.3d 778 (7th Cir. 2014) (Posner, J.) (CCAF).

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Caselaw produced by public interest objectors

  • In re Walgreen Co. Stockholders Litig., No. 15-3799, 2016 U.S. App.

LEXIS 14684 (7th Cir. Aug. 10, 2016) (reverses approval of disclosure-

  • nly settlement in merger class action; attorneys should not receive fees

for worthless disclosures) (Posner, J.) (CCAF).

  • In re BankAmerica Corp. Secs. Litig., 775 F.3d 1060 (8th Cir. 2015)

(reverses settlement with questionable cy pres component) (CCAF).

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(reverses settlement with questionable cy pres component) (CCAF).

  • Vassalle v. Midland Funding LLC, 708 F.3d 747 (6th Cir. 2013)

(reverses approval of settlement that provided only “perfunctory relief” to class members) (National Consumer Law Center).

  • Klier v. Elf Atochem N. Am., Inc., 658 F.3d 468 (5th Cir. 2011)

(reverses settlement with questionable cy pres component) (Georgetown

  • Univ. Law Center, Institute for Public Representation).
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IV – The Proposed Rule 23 Amendments

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The proposed Rule 23(e)(5)

(5) Class-Member Objections. (A) In General. Any class member may object to the proposal if it requires court approval under this subdivision (e); the objection may be withdrawn only with the court’s approval. The objection must state whether it applies only to the objector, to a specific subset of the class, or to the entire class, and also state with specificity the grounds for the objection. (B) Court Approval Required For Payment to an Objector or Objector’ s Counsel. Unless approved by the court after a hearing, no payment or other consideration may be provided to

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approved by the court after a hearing, no payment or other consideration may be provided to an objector or objector’s counsel in connection with:

(i) forgoing or withdrawing an objection, or (ii) forgoing, dismissing, or abandoning an appeal from a judgment approving the proposal.

(C) Procedure For Approval After an Appeal. If approval under Rule 23(e)(5)(B) has not been obtained before an appeal is docketed in the court of appeals, the procedure of Rule 62.1 applies while the appeal remains pending.

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The Committee’s Thinking

  • “An objector should be free to withdraw on concluding that an objection is not
  • justified. But Rule 23(e)(5)(B)(i) requires court approval of any payment or
  • ther consideration in connection with withdrawing the objection.”
  • “Good-faith objections can assist the court in evaluating a proposal under Rule

23(e)(2). It is legitimate for an objector to seek payment for providing such assistance under Rule 23(h). …

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assistance under Rule 23(h). … But some objectors may be seeking only personal gain, and using objections to

  • btain benefits for themselves rather than assisting in the settlement-review
  • process. At least in some instances, it seems that objectors—or their

counsel—have sought to extract tribute to withdraw their objections or dismiss appeals from judgments approving class settlements. And class counsel sometimes may feel that avoiding the delay produced by an appeal justifies providing payment or other consideration to these objectors.”

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SLIDE 26

How will it play out?

  • Requiring sunlight on
  • bjector deals may deter

some professional objectors.

– Less likely to bring

  • bjections if can’t do easily.
  • Likely won’t affect public-

interest objectors.

– They’re not in it for the payoff.

  • Some defendants concerned

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  • bjections if can’t do easily.
  • Some defendants concerned

it will make settlement more difficult in general

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V- Best Practices for Objector-Proofing Settlements

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SLIDE 28

Basic strategies

  • Prevention
  • Negotiation
  • Litigation

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  • Litigation
  • Coercion

NOTE – Each of following strategies discussed has actually been employed in cases.

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SLIDE 29

Prevention

  • Objector-proof the settlement
  • Show that settlement is good idea
  • Works best with

– Competitors

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– Competitors – Public Interest – Can also mitigate professionals

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Prevention – Settlement Structure

  • Structure settlement to frustrate litigation over fairness
  • Quick-pay provisions

– pay plaintiffs’ counsel immediately, class after approval

  • Brief objection periods

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  • Brief objection periods
  • Injunctive rather than monetary relief
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Prevention - Competitors

  • Play fair with other counsel

– Be transparent about auctions – Be “fair” in settlement allocations

  • Drawbacks

– Can lose advantage in competitive settings

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allocations – Don’t use bar provisions that will alienate co- defendants – Can annoy corporate clients

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Prevention – Ideologues (Judge Alsup’s Red Flags)

  • Due diligence
  • Cost-benefit for absent class

members

  • Scope of the release (larger than

complaint).

  • Expansion of class (started out

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  • Expansion of class (started out

small, got big in settlement)

  • Reversions (favor defendants)
  • Claim procedure (if it

discourages claims)

  • Incentive payments (why does

the named plaintiff need more than the class member?)

  • Arellano v. T-Mobile USA,

Inc., 2011 U.S. Dist. LEXIS 21441 (N.D. Cal. Mar. 3, 2011).

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SLIDE 33

Prevention – Other red flags

  • Coupons

– Feder v. Frank

  • Excessive cy pres relief

– In re Baby Prods. Antitrust

  • Subclasses with competing

interests

– Dewey v. Volkswagen Aktiengesellschaft, 681 F. 3d

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– In re Baby Prods. Antitrust Litig., 708 F.3d 163 (3d Cir. 2013). Aktiengesellschaft, 681 F. 3d 170 (3d Cir. 2012).

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Negotiation

  • Not all objectors are the

enemy:

– They are constituents of the settlement, even if not the majority.

Drawbacks

  • Annoys plaintiffs

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majority. – They can help drive down fees in settlement negotiations. – May help strengthen settlement.

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SLIDE 35

Negotiation

  • Genuine compromise

– Remove offending provisions – Add value for class members – Reduce fees

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SLIDE 36

Negotiation - Buyoff

  • Pay the objector to go away

– Competitors – may require fees

  • Drawbacks

– Can look like collusion

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– Professionals – will require fees – Public Interest– client can sometimes be induced to fold – May alienate ideologues

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Litigation

  • Discovery
  • Sanctions
  • Separate lawsuits
  • Fight fees
  • Appeals bonds

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  • Appeals bonds
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SLIDE 38

Litigation - Discovery

  • Depositions into adequacy
  • Explore relationships with
  • bjector counsel
  • Information of objection

history.

  • Drawbacks

– Tensions with usual plaintiff procedures.

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history.

– DeHoyos v. Allstate Corp., 240 F.R.D. 269, 316 (W.D.

  • Tex. 2007) (disclosure of

attorneys’ objection history would not chill objections).

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SLIDE 39

Litigation - Sanctions

  • Can deter some objectors

– Turner v. Murphy Oil USA, Inc., 582 F. Supp. 2d 797, 806 n.32 (E.D. La. 2008) (objector withdrew motion after sanction motions

  • Drawbacks

– Courts may be reluctant to grant – Will make subsequent

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after sanction motions filed). – Will make subsequent negotiations more difficult

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Litigation – Separate Lawsuit

  • Bruce Greenberg

recommends

  • If evidence allows:

– RICO claim

  • But see – Lexecon Inc. v.

Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998).

– Plaintiff’s firm filed lawsuit

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– Plaintiff’s firm filed lawsuit against defendant expert – Wound up losing huge amount of money

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Litigation - Opposition to fees

  • Oppose fees entirely
  • Require submission of

timesheets & expenses

  • Drawbacks

– Tension when plaintiffs’ counsel requests fees – Not as effective against public

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  • Require lodestar

– Not as effective against public interest

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Litigation – Appeals bonds

  • FRAP 7 – “In a civil case,

the district court may require an appellant to file a bond or provide other security in any form and amount necessary

  • Language is permissive
  • Means there may be inquiry

into equities of situation

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form and amount necessary to ensure payment of costs

  • n appeal. Rule 8(b) applies

to a surety on a bond given under this rule.”

  • Means there may be inquiry

into equities of situation

  • Courts generally reluctant
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Coercion

  • Embarrassment
  • Threats
  • Payback

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  • Payback
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Coercion - Embarrassment

  • Public embarrassment

related to settlement

– Characterize as holdouts, greedy, etc.

  • Unlikely to work with public

interest

– May dig in

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  • Example: Letter to class

members by plaintiffs in Cobell v. Salazar.

  • Requires “clean hands”
  • May violate ethical rules
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Coercion – Threats

  • Public embarrassment

unrelated to settlement

– Personal peccadilloes

  • Litigation
  • Drawbacks

– Potentially unethical

  • Model Rule 3.4(e)
  • Model Rule 3.6

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  • Litigation
  • Any other leverage one may

hold

  • Model Rule 3.6

– May backfire if used (cf. Lerach-Fischel feud)

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Coercion – Payback

  • Objectors may be repeat

players

  • Implicit threat of non-

cooperation in subsequent

  • Most effective against

– Competitors – Professionals

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cooperation in subsequent cases

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For more, see

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Chapter 8 – Settlement tactics Chapter 3 – Multiple Parties

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Questions or Comments?

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www.mcguirewoods.com Classactioncountermeasures.com