$1.5M Attys’ Fees Scuttle HP Printer Defect Deal In 9th Circ.

Law 360 reports on the Center for Class Action Fairness' victory in their objection to the Hewlett-Packard Co. settlement which benefited the plaintiffs' lawyers more than the class members.

The Ninth Circuit on Wednesday scrapped the settlement of a consumer class action alleging Hewlett-Packard Co. deceptively marketed printer ink cartridges, finding the trial judge's award of $1.5 million in attorneys' fees was incorrectly calculated under the Class Action Fairness Act.

A 2-1 majority of the appeals court sided with class action reform activist Ted Frank, who objected to the settlement, arguing that U.S. District Judge Jeremy D. Fogel failed to apply CAFA provisions designed to prevent class counsel from being unfairly compensated when they obtain coupon — rather than cash — relief for class members.

As part of the settlement of a consolidated class action that Judge Fogel preliminarily approved in October 2010, HP agreed to provide eligible class members with up to $5 million in “e-credits” redeemable for printers and printer supplies on HP’s website. The appeals panel reversed the order approving the settlement and remanded it back to the district court for further proceedings consistent with the opinion.

Read the full article at Law 360.