In Dennis v. Kellogg Company, No. 11-55674 & No. 11-55706, 2012 U.S. App. LEXIS 18576 (9th Cir. Sept. 4, 2012), the Ninth Circuit Court of Appeals reversed the district court’s approval of a class action settlement because the terms of the settlement did not meet the legal standards for cy pres distribution. In particular, the settlement did not (1) sufficiently relate the cy pres distributions to the plaintiff class or the class’s underlying legal claims; (2) identify the ultimate recipients of the cy pres awards; and (3) set forth any limiting restrictions on those recipients or the awards they would receive. Id. at *3.
Continue Reading Dennis v. Kellogg Company: Ninth Circuit Court of Appeals Sets Aside Class Action Settlement Because Terms Did Not Meet Legal Standards for Cy Pres Distribution

In the recently published decision Dennis v. Kellogg Company, No. 11-55674, 2012 WL 2870128 (9th Cir. July 13, 2012), the Ninth Circuit reversed the district court’s approval of a purported $10.64 million settlement between defendant Kellogg and a class of consumers alleging false advertising. The Ninth Circuit rejected the settlement for three reasons: (1) the District Court did not apply the correct legal standard in evaluating the proposed cy pres charities that were to be the recipients of the settlement funds, and thereby abused its discretion; (2) the settlement failed to name the charities that would receive cy pres donations; and (3) the District Court’s award of $2 million in attorneys’ fees, the maximum amount Kellogg had agreed not to oppose, was excessive.
Continue Reading Ninth Circuit rejects class action settlement, clarifies standards for cy pres remedies and plaintiff counsel’s attorneys’ fees

If a defendant in a putative class action settles with the class representative prior to class certification, does the defendant nonetheless have to respond to pre-settlement discovery requests to identify absent class members? According to the California Court of Appeal in Pirjada v. Superior Court, 2011 WL 6144930, Case No. B234813 (Cal. App. Dec. 12, 2011), the answer is no, although the appellate court left open the possibility that the trial court could require some form of notice to protect the interests of absent class members.
Continue Reading Court of Appeal Reminds Litigants That Settling With Named Plaintiff Does Not Necessarily End Putative Class Action

On September 8, 2009, the Third Circuit Court of Appeals upheld the approval of two multimillion-dollar class action settlements in consolidated multi district cases arising from investigations and civil lawsuits alleging bid rigging and steering activities in the insurance industry. See In re Insurance Brokerage Antitrust Litigation, Nos. 07-1759 et al. (3d Cir. Sept. 8, 2009).  Specifically, after rejecting objections to the settlements, the court approved two settlements valued at $150 million, and also approved an award of $29.9 million in legal fees and costs for the larger of the settlements.
Continue Reading Multimillion Dollar Class Action Settlements Approved In Insurance Brokerage Litigations