Wednesday, March 4, 2020
Lawyers to Receive $3.89 Million in Fees, Costs in Case Where Injunctive Relief Is Attained, but No Damages
By a MetNews Staff Writer
The Ninth U.S. Circuit Court of Appeals yesterday affirmed the District Court’s approval of the settlement of a nationwide class action against Facebook under which class members are to receive no damages, but do gain injunctive relief against the pilfering and commercial use of web addresses contained in private messages, with the class attorneys receiving $3.89 million in fees and costs.
Judge Michelle T. Friedland wrote the opinion in which she spurns contentions by the objector, Anna St. John. Friedland said the District Court judge, Phyllis J. Hamilton of the Northern District of California, fulfilled her duty of looking for possible “warning signs” of collusion between class counsel and Facebook and committed no abuse of discretion in finding no indications of that existed.
“To be sure, in a case where the class primarily receives non-monetary relief, but class counsel obtain millions of dollars, it may be an abuse of discretion not to at least attempt to approximate the value of injunctive relief and use that valuation in an assessment of disproportionality,” she said. “But in this case, the district court did not abuse its discretion by declining to do so.”
She noted that Hamilton had already ruled out any damages being awarded, and said:
“When further litigation may result in substantial monetary relief to class members, the failure to include meaningful monetary relief in a settlement might be (but is not necessarily) a subtle sign that class counsel bargained away something valuable to benefit themselves. In such settlements, in order to show that nothing was unfairly bargained away by counsel, it may be necessary for settling parties to show why their non-monetary settlement is at least as good for the class as any monetary figure that would approximate what they could expect from further litigation.”
“But where, as here, further litigation of the case being settled is extremely unlikely to result in a damages award, the assessment of whether counsel got more fees by bargaining away valuable relief for the class is more qualitative, and more context-specific.”
Not ‘Worthless’ Relief
Rejecting the contention that the settlement was an unfair one because class members only obtained “worthless injunctive relief,” Friedland said:
“The settlement requires, in relevant part, that Facebook make a plain English disclosure on its Help Center page that tells users that Facebook ‘use[s] tools to identify and store links shared in messages.’ The settlement requires Facebook to display the relevant language on its Help Center page for a year. In light of the nature of the claims here, a year-long requirement to make such a disclosure has value: it provides information to users about Facebook’s message monitoring practices, making it less likely that users will unwittingly divulge private information to Facebook or third parties in the course of using Facebook’s messaging platform.”
She added that “the class did not need to receive much for the settlement to be fair because the class gave up very little” given the weakness of the claims for monetary relief, which could only have been secured, at that point, by appealing the order barring damages and succeeding.
The case is Campbell v. St. John, 17-16873.
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