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Supreme Court Mulls Case That Would Trim Fees In Class Actions

Thursday, February 9, 2017 11:57
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Forbes writer Daniel Fisher discusses CEI’s Supreme Court petition in Blackman v. Gascho:

Blackman v. Gascho reprepresents a split between the Sixth Circuit and the Seventh, which adopted a stricter test of fairness penned by Judge Richard Posner in a typically acerbic opinion, Pearson v. NBTY. In that decision (which quotes FORBES at page 7), Posner rejected a settlement that would have yielded lawyers $1.9 million in fees based on the plaintiff lawyers’ estimated value of $20.2 million, when less than $1 million was actually paid out to class members.

The “Posner Rule” is to “judge settlements by what they actually deliver to the class,” said Ted Frank, a lawyer with the Competitive Enterprise Institute’s Center for Class Action Fairness who represents the objectors in Global Fitness. “It’s a problem when the attorneys compromise the class to take more fees for themselves.”

“This isn’t a case where it was hard to get money to the class,” said Frank. “They knew the addresses. They knew what every class member was owed. They could have mailed checks.”

Thursday, February 9, 2017
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Ted Frank
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