18th Annual Workplace Class Action Report - 2022 Edition

468 Annual Workplace Class Action Litigation Report: 2022 Edition Hill, et al. v. Canidae Corp., 2021 U.S. Dist. LEXIS 214023 (C.D. Cal. April 2, 2021) . Plaintiffs filed a consumer class action alleging breach of contract, breach of implied warranty of merchantability; unjust enrichment; violation of the California Consumers Legal Remedies Act, violation of the California False Advertising Law, violation of the California Unfair Competition Law, and violation of New York common law in connection with Defendant’s sale of dog food labeled “grain free” that actually contained grain products. The parties ultimately settled the matter and the Court granted preliminary settlement approval. Under the terms of the settlement, class members could obtain a $5 credit for each $50 spent, up to a total not to exceed $125. The settlement also allowed for incentive awards of $5,000 for the named Plaintiffs and up to $1.3 million in attorneys’ fees. The Court determined that the proposed settlement class met the Rule 23 requirements. The Court also found that the parties engaged in extensive research prior to mediation, exchanged confirmatory discovery on sales figures and product testing results, and reached the settlement after extensive negotiations facilitated by a mediator. The Court opined that the agreement provided meaningful relief to the class members, which supported preliminary approval. The Court also believed the risk, expense, and likely duration of further litigation weighed in favor of preliminary approval. While the requested incentive award might be reasonable, the Court advised Plaintiffs to provide additional information about their involvement in the action and their efforts in pursuing the claims. Id . at *23. Finally, in determining the fairness of attorneys’ fees, the Court reasoned that since there was no common fund in the settlement, it would consider class counsel’s lodestar, the number of potential class members, the total number of claims filed, and the total payout in considering whether the requested attorneys’ fees were reasonable at the final approval stage. In Re Bank Of America Corp., 2021 U.S. App. LEXIS 30218 (8th Cir. Oct. 8, 2021). Plaintiffs, a group of shareholders of NationsBank and BankAmerica, filed securities fraud class actions in 1999, after the publicly held companies merged to form Bank of America Corp. The parties subsequently settled the litigation and the Court granted settlement approval and awarded approximately $58 million in fees to class counsel. Subsequently, almost two decades later, attorney David Oetting, one of the lead Plaintiffs for the class, filed a motion to reconsider the fee award and to order disgorgement of some $38 million in fees previously paid to class counsel based on their poor performance, mismanagement of the settlement fund, and abandonment of the class. Id . at *2. The District Court denied Oetting’s motion on the grounds that it was barred by the equitable doctrine of laches. On appeal, the Eighth Circuit affirmed the District Court’s ruling. Plaintiff asserted that the attorneys’ fee award could be analyzed using the "look back" provision in the Private Securities Litigation Reform Act of 1995 ("PSLRA"). Id . at *10-11. The Eighth Circuit concluded that there were three overriding factors in finding that the District Court did not abuse its discretion in applying laches to bar Plaintiff’s equitable disgorgement claims, including: (i) he never asserted the claim that all class counsel who were awarded fees in 2002 should be required to disgorge all fees paid above the lodestar amount used as a comparative benchmark when reducing the percentage-of-recovery fee award; (ii) in arguing that the initial approved fee awards should be dramatically reduced, Plaintiff only asserted contentions that were rejected by the District Court and/or the Eighth Circuit previously; and (iii) the Eighth Circuit agreed that the challenged actions occurred seven to 15 years before Plaintiff sought total disgorgement in his redetermination motion. Therefore, the Eighth Circuit held that Plaintiff’s motion was based on an inexcusable delay. Accordingly, the Eighth Circuit determined that the District Court did not abuse its discretion in applying laches to bar Plaintiff’s motion for redetermination. In Re General Motors LLC Ignition Switch Litigation , 2021 U.S. Dist. LEXIS 72423 (S.D.N.Y. April 13, 2021). Plaintiffs in a multi-district class action sought to recover for economic losses allegedly sustained by owners of certain General Motors (“GM”) branded cars due to defects in the ignition switches. The original named Plaintiff in the litigation was represented by James Zonas, who then moved to reopen the case and to enforce an attorneys’ lien for fees. The Court granted the motions and directed Zonas to file an accounting of his fees and expenses. Id . at *154. Zonas thereafter filed a motion seeking an award of $17,270 in fees and $4,646.97 in expenses. The Court granted in part the motion. The Court previously had held that the charging lien was valid only for work performed before August 11, 2017, the date on which the Court found Zonas had been fired by the original named Plaintiff. The Court concluded that the account prepared by Zonas included expenses that he had been reimbursed for previously, and for work not reasonably done (or done at all) or for which he already received payment. The Court determined that Zonas was effectively seeking to triple-bill for the expert expenses incurred for which he already received payment under the terms of the parties’ settlement agreement. As to the attorneys’ fee petition, Zonas requested 46.6 attorney hours and 12 law clerk hours. The