By: WISCONSIN LAW JOURNAL STAFF//June 3, 2014//
U.S. Court of Appeals for the 7th Circuit
Civil
Civil Procedure — class actions
Where the settlement of a class action effectively provided nothing to class members, it was error for the district court to approve the settlement.
“In sum, almost every danger sign in a class action settlement that our court and other courts have warned district judges to be on the lookout for was present in this case. See, e.g., Synfuel Technologies, Inc. v. DHL Express (USA), Inc., supra, 463 F.3d at 654; Smith v. Sprint Communications Co., 387 F.3d 612, 614 (7th Cir. 2004); Mirfasihi v. Fleet Mortgage Corp., supra, 356 F.3d at 785–86; Reynolds v. Beneficial National Bank, supra, 288 F.3d at 282–83; Crawford v. Equifax Payment Services, Inc., 201 F.3d 877, 880 (7th Cir. 2000); In re Bluetooth Headset Products Liability Litigation, 654 F.3d 935, 946–47 (9th Cir. 2011); Weinberger v. Great Northern Nekoosa Corp., 925 F.2d 518, 525 (1st Cir. 1991). Most were not even mentioned by the district judge, and those that were received a brush-off. The settlement flunked the ‘fairness’ standard by the one-sidedness of its terms and the fatal conflicts of interest on the part of Saltzman and Weiss. This is a case in which ‘the lawyers support the settlement to get fees; the defendants support it to evade liability; the court can’t vindicate the class’s rights because the friendly presentation means that it lacks essential information.’ Kamilewicz v. Bank of Boston Corp., 100 F.3d 1348, 1352 (7th Cir. 1996) (dissent from denial of rehearing en banc).”
Reversed and Remanded.
13-2091, 13-2133, 13-2136, 13-2162 & 13-2202 Eubank v. Pella Corp.
Appeals from the United States District Court for the Northern District of Illinois, Zagel, J., Posner, J.