Price Fixing-Class Action

Listen to this article

7^th Circuit Court of Appeals

Case Name: John Andren v. End User Consumer Plaintiff Class

Case No.: 22-2889

Officials: Sykes, Chief Judge, and Brennan and Pryor, Circuit Judges.

Focus: Price Fixing-Class Action

Three separate groups of plaintiffs made allegations of price fixing within the broiler chicken market. This included a class of end users, encompassing individuals and entities that indirectly bought specific broiler types from the defendants or accused co-conspirators for personal consumption in specific jurisdictions during the designated class period. This class reached a settlement agreement with a subset of the defendants, resulting in a $181 million resolution. The district court issued a judgment (pursuant to FRCP 54(b)) concerning the parties that had settled. Class counsel was granted one-third of the settlement amount, which totaled $57.4 million after excluding expenses and incentive awards. However, one class member named Andren contended that the court had made errors by undervaluing bids presented by class counsel in auctions from other cases. Andren also disagreed with the court’s implication that the Seventh Circuit had rejected the use of fee structures that decrease over time, and questioned the credibility given to expert reports. When determining the fee award, the district court had considered actual agreements made between the parties, fee arrangements established in the legal services market, the initial risk of not being paid at the case’s outset, the performance of class counsel, and the fee awards granted in comparable cases.

Upon review, the Seventh Circuit invalidated the fee award. According to Seventh Circuit legal doctrine, the district court’s responsibility was to grant fees that aligned with a theoretical “ex-ante bargain” that would have been struck before the case commenced. In this regard, the court’s assessment had failed to take into account the bids class counsel had submitted in auctions for other cases and fee awards from jurisdictions outside their own.

Vacated and remanded

Decided 08/30/23

Full Text