Law360 cited CEI Senior Attorneys Ted Frank and Melissa Holyoak on Frank v. Gaos.
“Challengers to Google’s $8.5 million privacy settlement, the fairness of which the U.S. Supreme Court will consider next week, have cited a recent Ninth Circuit approval of a “cy pres” deal distributing class action awards to third parties and not consumers as reason for the high court to wade into the issue.
“Petitioners Theodore H. Frank and Melissa Ann Holyoak of Washington D.C.-based think tank Competitive Enterprise Institute warned Tuesday that the circuit court’s approval earlier this month of a lower court distributing leftover funds from a $38 million settlement to local San Diego universities instead of to class members encourages class counsel to steer money to their chosen charities instead of consumers.
“EasySaver is a disturbing example of how the Ninth Circuit’s lenient approach to cy pres in class action settlements creates an incentive for class attorneys to favor sending money to their preferred causes and institutions even when distribution of funds to the class is feasible,” said Frank, CEI’s director of litigation, in a press release. “This permissive approach underscores the need for the Supreme Court to adopt the proportionality standard used by other circuit courts of appeal to align the interests of class counsel with the class members they supposedly represent.”