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Bluetooth ripples: Dennis v. Kellogg Co.

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You might recall the Rice Krispies class action settlement, Weeks v. Kellogg that the Center for Class Action Fairness successfully objected to, resulting in a modification of cy pres and a reduction of attorneys' fees.

Dennis v. Kellogg was a similar case in the Southern District of California, except over Frosted Mini-Wheats cereal, and Kellogg agreed to an even worse settlement: millions of dollars for the attorneys, less than a million dollars for the class, and cy pres to undisclosed charities indistinguishable from those Kellogg was already giving tens of millions of dollars to. CCAF didn't have a client in that case, so didn't object, and the judge rubber-stamped. But Friday, the Ninth Circuit, citing CCAF victories in Bluetooth and Nachshin v. AOL, reversed on two independent grounds.

First, the failure to identify cy pres recipients precluded appellate review: "trust me" is not an appropriate limiting principle. "To approve this settlement despite its opacity would be to abdicate our responsibility to be 'particularly vigilant' of pre-certification class action settlements." Second, even if the cy pres had been acceptable, the attorneys' fees, reflecting both a gigantic multiplier of lodestar and more than twice the class recovery, were excessive. [LA Times via Bashman; Dennis v. Kellogg (9th Cir. Jul. 13, 2012)]

CCAF has some Rule 28(j) letters to write.

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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.