CEI Objects to Settlement Where Lawyers Make $1 Million, Class Gets Changes to Olive Oil Bottles

WASHINGTON, May 15, 2017 — The Competitive Enterprise Institute’s Center for Class Action Fairness (CCAF) recently objected to the proposed class action settlement, class certification, and class attorneys’ fees request in Kumar v. Salov North America Corp. on behalf of class member Ted Frank. The plaintiffs in this case alleged the defendant deceptively marketed their Filippo Berio brand olive oil as “Imported from Italy,” when many of the olives used to make the oil came from other countries.

In the settlement, class attorneys are seeking nearly $1 million in fees, despite securing less than $200,000 in monetary relief and worthless, duplicative injunctive relief for their clients. Unusually, the agreement allows the defendant to cancel the deal if too many class members filed claims.

“The settlement agreement created a massive conflict of interest between the class and their counsel. Class counsel had an incentive to reduce payouts to class members, because if too many class members filed claims, the lawyers could lose their million-dollar fee,” said CCAF attorney Will Chamberlain. “The poor results speak for themselves.”

Injunctive relief under the settlement requires the defendant to continue using a label that says merely “Imported,” which it started doing in 2015. “The defendant already changed the Filippo Berio label, and the change provides no benefits to class members,” said Chamberlain.

CCAF also argues that the settlement unfairly freezes out certain class members. Even though the class includes anyone who purchased the olive oil in the relevant time frame, only those class members who can actually attest under oath that they relied on the product’s “Imported from Italy” labeling are eligible for compensation. There is no reason for such a limitation and only demonstrates class counsel’s attempt to depress the number of claims filed to protect their fee.

See more information about this case here and read the objection here.

ABOUT: The Competitive Enterprise Institute’s Center for Class Action Fairness represents class members against unfair class action procedures and settlements. Originally founded by Ted Frank in 2009, the center has won millions of dollars for consumers and shareholders and won landmark precedents that safeguard consumers, investors, courts, and the general public.

Unfair settlements generally serve self-interested lawyers and third parties at the expense of absent class members, the group of people whose rights are traded away to settle a class action. Lawyers have an interest in their fees, defendants have an interest in cheaply disposing of a lawsuit, and the class’s interests can take a back seat in the process. CEI seeks to solve these problems by representing such class members pro bono and presenting judges with the other side of the argument.