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CCAF objection in Blessing v. Sirius XM Radio



The Center for Class Action Fairness LLC objected today to a valueless class action settlement: the objection, filed in the Southern District of New York on behalf of a class member, underscores that the proposed Sirius XM Radio settlement would provide valueless injunctive relief to the class but $13 million to class attorneys.

"Certainly, parties to a class action can agree to settle a case for $13 million," said Ted Frank, the lead attorney on the objection and the founder of CCAF. "But if they do, it is inherently unfair and unreasonable for the attorneys to extract 100% of the settlement benefit for themselves. Class actions should be prosecuted on behalf of the class members, not self-serving class counsel."

The settlement of the antitrust class action against Sirius XM requires only that the defendant agree to not raise prices for five months. But this is an entirely valueless promise, given that Sirius XM, facing admittedly heavy competition from Internet music services and MP3 players, has been lowering prices and engaging in deep discounting to keep customers. Yet class counsel (including the Milberg law firm) implausibly claims that the settlement is worth $180 million to the class.

The CCAF objection also targets Judge Harold Baer's class certification order. For several years, Judge Baer has controversially required class counsel to meet racial quotas as a condition of appointment. CCAF has requested that Judge Baer vacate that part of his class certification order as unconstitutional.

The case is Blessing v. Sirius XM Radio Inc., No. 09-cv-10035 (S.D.N.Y.).

The Center for Class Action Fairness, founded in 2009, is a not-for-profit program that provides pro bono representation to consumers and shareholders aggrieved by class action attorneys who negotiate settlements that benefit themselves at the expense of their putative clients. It has won millions of dollars for class members over the last two years.

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Isaac Gorodetski
Project Manager,
Center for Legal Policy at the
Manhattan Institute
igorodetski@manhattan-institute.org

Katherine Lazarski
Press Officer,
Manhattan Institute
klazarski@manhattan-institute.org

 

Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.