Simonet v. GlaxoSmithkline et al, No. 3:2006cv01230 - Document 166 (D.P.R. 2009)
Court Description: OPINION AND ORDER granting 124 Motion for Attorney Fees; granting 125 Motion requesting Order Granting Final Approval of Class Action Settlement . Signed by Judge Gustavo A. Gelpi on 09/4/2009. (RS)
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1 + IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO 2 3 ALMA SIMONET, et al. 4 Plaintiffs, 5 v. 6 GLAXOSMITHKLINE, et al., 7 Defendants. Civil No. 06-1230 (GAG/CVR) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 OPINION AND ORDER Presently before the court is a settlement agreement in the above-captioned class action that has been submitted for the court s final approval. After having held a Final Fairness Hearing on July 27, 2009, the court now APPROVES the proposed settlement agreement and AWARDS the proposed attorney s fees. In evaluating the propriety of a proposed class action settlement, courts are required to make an inquiry to determine whether the proposal, taken as a whole, is fair, adequate, reasonable, and in the best interests of all those who will be affected by it. 7B Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 1797.1 (Civil 3d 2005); see also Giusti-Bravo v. United States Veterans Administration, 853 F. Supp. 34, 36 (D.P.R. 1993). In determining whether a settlement is fair, reasonable, and adequate, the court does not act in a vacuum. Several factors have to be taken into consideration by the court when making the inquiry. Among them are the likelihood of recovery, or likelihood of success on the merits; the amount and nature of discovery or evidence; the settlement terms and conditions; the recommendation and experience of counsel; the future expense and likely duration of litigation; the recommendation of neutral parties, if any; the number of objectors and nature of the objections; the presence of good faith and the absence of collusion. Giusti-Bravo, 853 F. Supp at 36 (citing Herbert B. Newberg & Alba Conte, 2H Newberg on Class Actions § 11.43 (1992)). Civil No. 06-1230 (GAG/CVR) 1 (i) Likelihood of recovery or success on the merits 2 In applying this factor, the court is required to judge the fairness of the proposed compromise 3 by evaluating the probable outcome of the litigation and the terms of the settlement and by weighing 4 the remedies the class could secure from it against the probable costs and results of continued 5 litigation. Carson v. American Brands, Inc., 450 U.S. 79, 88 n. 14 (1981). In doing so, however, 6 the court is not to decide the merits of the case or resolve unsettled legal questions. Id. As discussed 7 in the Final Fairness Hearing, in this case there is an issue as to what proof, if any, can be offered 8 by the members of the class to prove their damages. This issue could make recovery by the class 9 members particularly difficult. The court finds that the amount of the settlement is very adequate 10 and beneficial to the class given that if this case were not settled there is a high probability that the 11 class members would not be able to a secure any amount of damages. 12 (ii) The amount and nature of discovery 13 The court is required to ascertain whether sufficient evidence has been obtained through 14 discovery in order to allow a determination as to the adequacy of a settlement. The facts of this case 15 show that both class counsel and defendant s counsel have been very diligent in conducting 16 discovery and that, by the time the settlement was reached, an extensive amount of discovery had 17 already been completed. The court understands that the amount of discovery conducted so far is 18 sufficient to permit an accurate assessment of each party s strengths and weaknesses. After 19 assessing the strengths and weaknesses of each party, the court finds that this settlement is 20 appropriate. 21 (iii) 22 The court is also required to make a determination that the settlement secures an adequate 23 advantage for the class in return for the surrender of litigation rights against the defendants. That 24 seems to be the case here insofar as the class members are getting a substantial monetary settlement 25 in exchange for surrendering litigation rights which clearly do not guarantee any award of damages 26 or that liability will be established. The settlement terms and conditions 27 28 2 Civil No. 06-1230 (GAG/CVR) 1 (iv) 2 The court must also take into account the recommendation of counsel. The weight accorded 3 to it is dependent on a variety of factors, among them, the length of their involvement in the 4 litigation, their competence, and their experience in this particular type of litigation. As discussed 5 in the Fairness Hearing, counsel for both the class and the defendants have ample experience in class 6 action litigation. Furthermore, they have worked in this case, as well as on the related California 7 litigation, for many years and, thus, are very familiar with the claims and the probability of success 8 in the merits. Therefore, their endorsement of this settlement carries much weight with the court. 9 (v) The recommendation and experience of counsel The future expense and likely duration of litigation 10 This case is already three years old. The court is aware that if this case were not settled it 11 would probably continue for many more years given the extensive discovery that would be needed 12 and the sophisticated nature of the claims. Therefore, this court finds that it would be beneficial for 13 the class members to conclude this litigation as soon as practicable. Also, this case puts and end to 14 the California state court litigation between the same parties. 15 (vi) The number of objectors and nature of the objections 16 There are several objections in this case. The most important ones will be discussed 17 seriatim. Firstly, the objectors claim that the consumer class and the third-party payor class should 18 be represented by separate counsel so that the interests of both sub-classes can be adequately 19 represented. During the Fairness Hearing this issue was clarified and it was stated that both sub- 20 classes are indeed represented by separate counsel. Therefore, the interests of both have been 21 adequately protected in this settlement. 22 Second, the objectors claim that the attorney s fees in this case should not be based on the 23 amount of the settlement fund but instead on the actual amount claimed by class members. There 24 is ample case law which supports the idea of allowing attorney s fees based on a percentage of the 25 total amount of the settlement fund. See, e.g., Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980). 26 Furthermore, ample evidence was offered in the hearing that showed that there was an adequate 27 28 3 Civil No. 06-1230 (GAG/CVR) 1 relationship between the amount of money they would receive under the proposed settlement and 2 the amount that they would be entitled to under a Lodestar analysis. Therefore, this court finds that 3 the award of attorney s fees based on a percentage of the settlement fund is appropriate. 4 Third, the objectors state that any leftover money should not revert back to the defendant if 5 it is not claimed by class members. The present settlement states that any unclaimed money shall 6 revert back to the defendant. The court understands that this is reasonable and beneficial for both 7 parties. First, defendant would probably not be willing to settle this case if it were not for this 8 disposition. And second, if this case were decided on the merits the same situation would develop 9 insofar as any money that was not actually claimed by class members would revert back to 10 defendant. For these reasons, the court rejects this objection. 11 Fourth, some objectors claim that the notification process is flawed and that, therefore, class 12 members should be identified and notified through a court-authorized subpoena process. The court 13 disagrees with this idea. Notification schemes like the one here have been effectively used in class 14 action suits throughout the United States. Furthermore, there are too many privacy implications of 15 a system whereby the court subpoenas private medical information from pharmacies nationwide. 16 (vii) 17 Finally, none of the parties has offered any evidence of collusion or of a lack of good faith 18 by any of the parties to this action. Furthermore, after analyzing all of the pleadings and the 19 settlement agreement, the court concludes that this is a fair and balanced settlement that was 20 achieved through good faith by all parties. 21 22 The presence of good faith and the absence of collusion For the aforementioned reasons, the court APPROVES the proposed settlement agreement and AWARDS the proposed attorney s fees. Judgment shall be entered accordingly. 23 SO ORDERED. 24 In San Juan, Puerto Rico this 4th day of September 2009. 25 S/Gustavo A. Gelpà 26 GUSTAVO A. GELPI United States District Judge 27 28 4 Civil No. 06-1230 (GAG/CVR) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5
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