Seifi et al v. Mercedes-Benz USA, LLC

Filing 149

ORDER by Judge Thelton E. Henderson granting 142 Motion for Preliminary Approval of Class Action Settlement. Motion for Final Approval due 08/03/2015. Fairness Hearing set for 08/17/2015 at 10:00 AM in Courtroom 2. (tehlc1, COURT STAFF) (Filed on 4/8/2015)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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MAJEED SEIFI, et al.,

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Plaintiffs,
v.

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MERCEDES-BENZ U.S.A., LLC,
Defendant.

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Case No. 12-cv-05493-TEH
ORDER GRANTING
PRELIMINARY APPROVAL OF
CLASS ACTION SETTLEMENT,
VACATING HEARING, AND
SETTING FAIRNESS HEARING

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Plaintiffs moved this Court for an Order preliminarily approving the parties’

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United States District Court
Northern District of California

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settlement, certifying a settlement class, appointing settlement class counsel, setting a

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hearing on the final approval of the settlement, and directing notice to the class (the

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“Motion”). Mercedes-Benz USA, LLC (“MBUSA”) joined in Plaintiffs’ request for an

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order preliminarily approving the parties’ settlement. Upon considering the Motion, the

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parties’ Class Action Settlement Agreement and Release, an Addendum, and all exhibits

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thereto (collectively, the “Settlement Agreement” or “Settlement”), the materials

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previously submitted in this case, and other materials relevant to this matter, it is hereby

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ORDERED that:

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1.

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The Court grants preliminary approval of the Settlement based upon the

terms set forth in the Settlement Agreement filed with the Motion.
2.

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The terms of the Settlement Agreement are sufficiently fair, reasonable, and

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adequate to allow dissemination of the Notice according to the Notice Plan.1 This

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determination is not a final finding that the Settlement Agreement is fair, reasonable, and

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adequate, but instead is a determination that there is good cause to submit the proposed

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Settlement Agreement to Settlement Class Members and to hold a hearing concerning final

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approval of the proposed settlement, and ultimately approve the settlement.

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To the extent capitalized terms are not defined in this Order, they shall have the meaning
set forth in the Settlement Agreement.

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3.

The parties have made a sufficient showing, under the provisions of Rule 23

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of the Federal Rules of Civil Procedure, as applicable in the context of settlement classes,

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to establish reasonable cause, following Notice to members of the proposed Settlement

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Class, to hold a hearing to determine if a Class should be certified for settlement purposes

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only, consisting of persons who meet the following criteria:

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All current and former owners and lessees of Mercedes-Benz
branded automobiles equipped with M272 or M273 engines
bearing serial numbers up to 2729..30 468993 or 2739 ..30
088611, found in the Subject 2005 – 2007 Model Year
Vehicles respectively (the “Subject Vehicles”), who purchased
or leased their Subject Vehicles within the United States.

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Excluded from the Settlement Class are: Persons who validly
and timely exclude themselves; Persons who have settled with,
released, or otherwise had claims adjudicated on the merits
against MBUSA that are substantially similar to those alleged
in this matter; Persons with only claims relating to personal
injury, wrongful death or property damage (relating to property
other than the Subject Vehicles) as a result of the defects
alleged; employees of MBUSA; insurers or other providers of
extended service contracts or warranties for the vehicles owned
by settlement class members; and the Honorable Thelton E.
Henderson and the Honorable Jacqueline Scott Corley and
members of their respective families.

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United States District Court
Northern District of California

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If, for any reason, the proposed settlement is not approved, any order certifying a

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settlement class shall be vacated nunc pro tunc and the Litigation shall proceed as though

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the Settlement Class had never been certified, without prejudice to the parties’ rights to

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either request or oppose class certification for purposes of litigation.

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4.

In making the findings set forth in Paragraph 3, the Court has exercised its

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discretion in conditionally certifying the Settlement Class on a nationwide basis. Named

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Plaintiffs Majeed Seifi, Tracey Deakin and Ronald Reyner are designated as the Class

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Representatives.

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5.

The Court hereby appoints the following attorneys as counsel for the

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Settlement Class: Roy A. Katriel of the Katriel Law Firm, and Gary S. Graifman of

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Kantrowitz Goldhamer & Graifman, P.C., and the successors of these law firms

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(collectively, “Class Counsel”). For purposes of these settlement proceedings, the Court

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finds that the Katriel Law Firm and Kantrowitz Goldhamer & Graifman, P.C., are
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competent and capable of exercising their responsibility as Class Counsel.
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This Court has both subject matter jurisdiction and personal jurisdiction as to

this action and all parties before it.
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The Settlement Agreement is for settlement purposes only. Neither the fact

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of, any provision contained in, nor any action taken under the Settlement Agreement shall

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be construed as an admission of the validity of any claim or any factual allegation that was

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or could have been made by Plaintiffs and Settlement Class Members in the Action, or of

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any wrongdoing, fault, violation of law, or liability of any kind on the part of Defendant or

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the Released Persons. The Settlement Agreement shall not be offered or be admissible in
evidence by or against Defendant or the Released Persons or cited or referred to in any

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United States District Court
Northern District of California

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other action or proceeding, except one (1) brought by or against the parties to enforce or

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otherwise implement the terms of the Settlement Agreement, or (2) involving any Plaintiff

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or Settlement Class Member to support a defense of res judicata, collateral estoppel,

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release, or other theory of claim preclusion, issue preclusion, or similar defense.
8.

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The Notice and provisions for disseminating notice substantially as described

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in and attached to the Settlement Agreement and the parties’ Joint Statement submitted on

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March 30, 2015 (Docket No. 147) are hereby approved. The Court approves the Notice

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attached as Exhibit 1 to the Settlement Agreement, as well as the Claim Form, attached as

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Exhibit 2 to the Settlement Agreement.2 These materials (a) provide the best practicable

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notice, (b) are reasonably calculated, under the circumstances, to apprise Settlement Class

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Members of the pendency of the action, the terms of the proposed settlement, and of their

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right to appear, object to, or exclude themselves from the proposed settlement, (c) are

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reasonable and constitute due, adequate, and sufficient notice to all persons entitled to

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receive notice, and (d) fully comply with federal law, the United States Constitution, and

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all other applicable laws.

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The parties shall modify Section 12 of the Notice to reflect the location of the Fairness
Hearing set forth in Section 20 of this Order.
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KCC Class Action Services, LLC (“KCC”), selected pursuant to the terms of

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the Settlement Agreement, shall be responsible for providing notice of the proposed

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settlement to the Settlement Class Members in accordance with the provisions referenced

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above and as directed under the Class Action Fairness Act (28 U.S.C. § 1715). MBUSA

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will pay KCC’s fees and costs.

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10.

To comply with their obligations under the Settlement Agreement, the

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parties must obtain vehicle registration information for Settlement Class Members for the

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purpose of disseminating notice of the proposed settlement to those persons and entities.

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MBUSA and KCC are hereby authorized to obtain vehicle registration information
concerning Settlement Class Members from R. L. Polk or a similar vendor for the sole

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United States District Court
Northern District of California

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purpose of providing notice to those persons and entities.

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11.

KCC shall mail the Notice to the identified Settlement Class Members per

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the Notice Plan within thirty-five (35) days of the entry of this Order. On the same date,

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KCC will make an informational settlement website available to the public, which website

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will include a copy of this Order, the Notice, the Settlement Agreement (including all

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Addenda thereto), the Claim Form, and other important documents. Within fifteen (15)

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days after the deadline to mail the Notice, KCC shall file declarations to the Court,

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attesting to the measures undertaken to provide Notice to the Settlement Class and as

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directed by CAFA.

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12.

Anyone who wishes to be excluded from the Settlement Class must submit a

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written request for exclusion (as described in the Notice and Settlement Agreement) by

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sending it to KCC Class Action Services, LLC, by First-Class U.S. mail to the address

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provided in the Notice. Requests for exclusion must contain all information described in

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the Settlement Agreement. The envelope containing the Request for Exclusion must be

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postmarked on or before the date set forth in the Notice, which shall be forty-five (45) days

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after the completion of mailing (or re-mailing, in the case of Notices returned

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undeliverable) of the Notice pursuant to the Settlement Agreement. The Court shall rule

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on the validity of exclusions at the Fairness Hearing.
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13.

Anyone who falls within the Settlement Class definition and does not submit

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a Request for Exclusion in complete accordance with the deadlines and other specifications

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set forth in this Order and the Settlement Agreement shall remain a Settlement Class

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Member and shall be bound by all proceedings, orders, and judgments of this Court

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pertaining to the Settlement Class.

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14.

Any Settlement Class Member who wishes to object to the proposed

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Settlement must send or file an Objection with this Court. Objections must contain all

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information described in the Settlement Agreement. The envelope containing the

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Objection to the Settlement must be postmarked on or before the date set forth in the
Notice, which shall be forty-five (45) days after completion of mailing (or re-mailing, in

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United States District Court
Northern District of California

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the case of Notices returned undeliverable) of the Notice pursuant to the Settlement

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Agreement. Objections may otherwise be filed within forty-five (45) days after

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completion of mailing (or re-mailing) of the Notice pursuant to the Settlement Agreement.

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Only Settlement Class Members may object to the Settlement. A copy of such papers

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being filed in support of any Objection shall also be mailed to Class Counsel and Defense

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Counsel within the forty-five (45) day period set forth herein.

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15.

Any Settlement Class Member who does not submit an Objection to the

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Settlement in complete accordance with this Order and the applicable provisions of the

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Settlement Agreement shall not be permitted to object to the settlement.

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16.

Any objecting Settlement Class Member may appear at the hearing on the

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fairness of the proposed settlement (the “Fairness Hearing”) held by the Court, in person or

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by counsel, to show cause why the Settlement Agreement should not be approved as fair,

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reasonable and adequate, or to object to any petitions for attorney fees and reimbursement

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of litigation costs and expenses; provided, however, that the objecting Settlement Class

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Member must mail or file with the Clerk of the Court, a notice of intention to appear at the

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Fairness Hearing (a “Notice of Intention to Appear”) on or before the date set forth in the

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Notice, which shall be forty-five (45) days after the completion of mailing (or re-mailing)

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of the Notice pursuant to the Settlement Agreement. The Notice of Intention to Appear
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must include all information and documents required by the Settlement Agreement. Any

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Settlement Class Member who does not provide a Notice of Intention to Appear in

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complete accordance with the deadlines and other specifications set forth in the Settlement

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Agreement, and who has not filed an Objection to the Settlement in complete accordance

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with the deadlines and other specifications set forth in the Settlement Agreement, will be

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barred from speaking or otherwise presenting any views at any Fairness Hearing.

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KCC shall also have the obligations otherwise enumerated in the Settlement

Agreement.
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Class Counsel shall file with the Court their motion for payment of

attorneys’ fees and reimbursement of litigation costs and expenses no later than fourteen

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United States District Court
Northern District of California

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(14) days before the expiration of the deadline for submitting opt-outs from and Objections

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to the Settlement Agreement for Notices that were not returned undeliverable. This

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request shall be consistent with the provisions of Section 9 of the Settlement Agreement.

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19.

Fourteen (14) days prior to the date set for the Fairness Hearing, Plaintiffs

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shall file a motion for judgment and final approval of the Settlement. The parties shall file

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their briefs in support of settlement approval, as well as any supplemental briefs supporting

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Class Counsel’s motion for attorney’s fees and reimbursement of litigation costs, at that

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time. The briefing shall include the parties’ responses to any Objections, as well as a

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declaration setting forth the number of Settlement Class Members who opted-out of the

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Settlement Class. Such briefing shall be served on any other attorneys who have entered

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an appearance in this proceeding, and on any member of the Settlement Class to whose

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Objection to the Settlement the memoranda or other briefing responds.

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If any Settlement Class Members object or opt-out after Plaintiffs file the motion

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for final approval, the parties shall file supplemental briefing no later than seven (7) days

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prior to the date set for the Fairness Hearing, setting forth the parties’ responses to such

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Objections and the number of opt-outs. If appropriate, the parties shall include

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supplemental briefing on Class Counsel’s motion for attorney’s fees at that time.

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On August 17, 2015, at 10:00 AM, the Court will hold the Fairness Hearing.

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It shall be held in Courtroom 2, on the 17th floor of the United States Courthouse, 450

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Golden Gate Avenue, San Francisco, California 94102. This time and place shall be set

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forth in the Mailed Notice. The Fairness Hearing may be continued or rescheduled by the

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Court without further notice to the class members. At the Fairness Hearing, or as soon

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thereafter as practicable, the Court will determine whether the proposed settlement is fair,

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reasonable, and adequate and should be approved by the Court. At the Fairness Hearing,

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the Court will also consider the amount of attorney fees and expenses that should be

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awarded to Class Counsel. If appropriate, the Court will issue a Final Order and Judgment

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memorializing its decision, in the form contemplated by the Settlement Agreement.
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United States District Court
Northern District of California

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Pending further orders by this Court, all proceedings in this case shall be

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stayed, except for proceedings pursuant to this Order. However, the Court declines to stay

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proceedings in any other active cases concerning substantially similar claims, or to enjoin

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Settlement Class Members from prosecuting such claims. “[A] court only has the

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discretion to stay its own action – not to order a stay in another forum . . . .” Rubenstein, 3

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NEWBERG ON CLASS ACTIONS § 10:40 (5th ed. 2013). Moreover, “preliminary approval is

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neither necessary for such an [anti-suit] injunction to be justified, nor often, standing alone,

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sufficient to justify one.” Rubenstein, 4 NEWBERG ON CLASS ACTIONS § 13:19 (5th ed.

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2014).

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The parties’ citation to Hanlon v. Chrysler Corp, 150 F.3d 1011 (9th Cir. 1998) in

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support of their requested injunction is unpersuasive. Hanlon addressed the power of a

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federal district court to enjoin parallel state court class actions under the All-Writs Act and

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the Anti-Injunction Act, where the class representative in one subsequently-filed state

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court suit attempted to opt-out a statewide class from the federal suit. Id. at 1024-25.

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Hanlon does not stand for the proposition that an anti-suit injunction is appropriate

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whenever one of a set of parallel class actions approaches settlement; rather, it supports the

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narrower proposition that a federal court has the discretion to enjoin state court class

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actions that threaten the federal court’s jurisdiction. Id. at 1025. “When an injunction
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sought in one federal proceeding would interfere with another federal proceeding,

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considerations of comity require more than the usual measure of restraint, and such

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injunctions should be granted only in the most unusual cases.” Bergh v. Washington, 535

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F.2d 505, 507 (9th Cir. 1976). This is not such a case.

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The case management conference set for April 13, 2015, and the preliminary

approval hearing set for April 27, 2015, are vacated.

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IT IS SO ORDERED.

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United States District Court
Northern District of California

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Dated: 04/08/15

_____________________________________
THELTON E. HENDERSON
United States District Judge

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