CEI Wins $500,000 for Consumers in Similasan Corp. Class Action
The U.S. District Court of the Southern District of California recently granted preliminary approval of a much improved class action settlement in Allen v. Similasan. The underlying suit alleged Similasan falsely marketed its homeopathic products as “Naturally Effective & Safe,” and violated FDA regulations, among other claims.
In a victory for the Competitive Enterprise Institute’s Center for Class Action Fairness (CCAF), the new settlement provides a $700,000 fund, which will provide more than $500,000 in relief to class members, a result of CCAF’s involvement in the case. The new settlement also reduces the attorneys’ original, excessive windfall to 25 percent of that fund.
“I’m happy my objection sent the parties back to the negotiating table and resulted in hundreds of thousands of dollars in cash relief for the class,” said objector and Center for Class Action Fairness attorney Frank Bednarz.
The original settlement gave attorneys a $545,000 payday, while the class members received nothing but meaningless label changes.
“We objected that the attorneys took 100% of the settlement benefit for themselves,” said Ted Frank, director of CEI’s Center for Class Action Fairness. “Sure enough, when courts insist that attorneys won’t get paid unless their clients do, they magically find ways to structure settlements so that the class members benefit. Incentives matter.”
The final hearing for settlement approval is set for August 7, 2017.
See more information on this case: Allen v. Similasan Corp.
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.