Candy corn, pumpkin pie, egg nog . . . no wonder that three months from now we’ll all be joining gyms.
Main Question: Is it fair for a settlement to so privilege attorneys with “preferential treatment” over their clients? Sixth Circuit law suggests the answer is, “No.”
Bonus Question: What is the value to the class of a settlement that pays the class $1.6 million? The answer: $8.5 million, according to the magistrate judge below, who literally split the difference between the amount that class members actually received and the $15.5 million they would have received if every single one of them–even those who hadn’t been notified of the settlement–submitted a claim. Respectfully, CCAF and Professor Blackman believe that’s a legally erroneous approach.
1“The ratio that is relevant to assessing the reasonableness of the attorneys’ fee that the parties agreed to is the ratio of (1) the fee to (2) the fee plus what the class members received.” Redman v. Radioshack Corp., — F.3d –, 2014 U.S. App. LEXIS 18181, *16, 2014 WL 4654477 (7th Cir. Sept. 19, 2014) (Posner, J.). The higher the ratio, the worse the settlement.