Delacruz v. Cytosport, Inc.

Filing 72

AMENDED ORDER by Judge Claudia Wilken PRELIMINARILY APPROVING CLASS ACTION SETTLEMENT, PROVISIONALLY CERTIFYING A NATIONWIDE SETTLEMENT CLASS, APPROVING PROPOSED NOTICE, AND SCHEDULING FAIRNESS HEARING. (terminating 58 Motion for Settlement and granting 67 Motion for Settlement) (ndr, COURT STAFF) (Filed on 11/18/2013)

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BARON & BUDD, P.C.
ROLAND TELLIS, SBN 186269
[e-mail]
MARK PIFKO, SBN 228412
[e-mail]
15910 Ventura Boulevard, Suite 1600
Encino, CA 91436
Telephone: [phone]
Fax: [phone]
Attorneys for Plaintiff
CLAIRE DELACRUZ individually, and
on behalf of other members of the public similarly situated

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GIBSON, DUNN & CRUTCHER LLP
G. CHARLES NIERLICH, SBN 196611
[e-mail]
TIMOTHY W. LOOSE, SBN 241037
[e-mail]
MATTHEW L. BERDE, SBN 260615
[e-mail]
555 Mission Street, Suite 3000
San Francisco, CA 94105-2933
Telephone: [phone]
Fax: [phone]

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Attorneys for Defendant
CYTOSPORT, INC., a California Corporation

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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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OAKLAND DIVISON
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CLAIRE DELACRUZ, individually, and on
behalf of other members of the general public
similarly situated,
Plaintiff,

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v.
CYTOSPORT, INC., a California
Corporation,

CASE NO.: 4:11-cv-03532-CW
AMENDED ORDER PRELIMINARILY
APPROVING CLASS ACTION SETTLEMENT,
PROVISIONALLY CERTIFYING A
NATIONWIDE SETTLEMENT CLASS,
APPROVING PROPOSED NOTICE, AND
SCHEDULING FAIRNESS HEARING

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Defendant.

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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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Upon review and consideration of the First Amended Settlement Agreement And Release, and
the attachments thereto (Dkt. No. 66), and the Plaintiff’s Motion for Preliminary Approval (Dkt. No.
58), which have been filed with the Court, it is HEREBY ORDERED, ADJUDGED and DECREED
as follows:
1.

The Court has carefully reviewed the First Amended Settlement Agreement And

Release, as well as the files, records, and proceedings to date in the Action. The definitions in the
First Amended Settlement Agreement And Release are hereby incorporated as though fully set forth
in this Order, and capitalized terms shall have the meanings attributed to them in the First Amended
Settlement Agreement And Release.
2.

The parties have agreed to settle the Action upon the terms and conditions set forth in

the First Amended Settlement Agreement And Release, which has been filed with the Court. The
First Amended Settlement Agreement And Release, including all exhibits thereto, is preliminarily
approved as fair, reasonable, and adequate. Plaintiff in the Action, by and through her counsel, has
investigated the facts and law relating to the matters alleged in her complaint, including extensive
pretrial discovery, pretrial motions practice, legal research as to the sufficiency of the claims, and an
evaluation of the risks associated with continued litigation, trial, and/or appeal. The settlement was
reached as a result of extensive arm’s length negotiations between counsel for Plaintiff, on the one
hand, and counsel for CytoSport, on the other hand, occurring over approximately one year and
multiple mediation sessions with two respected mediators—the Honorable Edward A. Panelli and the
Honorable Carl J. West, both currently affiliated with JAMS. The settlement confers substantial
benefits upon the Settlement Class, particularly in light of the damages that Plaintiff and Class
Counsel believe are potentially recoverable or provable at trial, without the costs, uncertainties,
delays, and other risks associated with continued litigation, trial, and/or appeal.
3.

The Court conditionally certifies, for settlement purposes only: a class of all persons

who purchased one or more Muscle Milk® Ready-to-Drink beverages (the “RTD”) and/or Muscle
Milk® bars (the “Bar,” together with the RTD, the “Products”) at retail in the United States from July
18, 2007 through December 31, 2012 (the “Settlement Class”). Excluded from the Settlement Class

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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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are all persons who are employees, directors, officers, and/or agents of CytoSport or its subsidiaries
and affiliated companies, as well as the Court and its immediate family and staff.
4.

The Court conditionally finds, for settlement purposes only and conditioned upon the

entry of this Order and the Final Order and Judgment that the prerequisites for a class action under
Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure have been satisfied in that: (a) the
number of Settlement Class Members is so numerous that joinder of all members thereof is
impracticable; (b) there are questions of law and fact common to the Settlement Class; (c) the claims
of the Plaintiff are typical of the claims of the Settlement Class they seek to represent for purposes of
settlement; (d) the Plaintiff has fairly and adequately represented the interests of the Settlement Class
and will continue to do so, and the Plaintiff has retained experienced counsel to represent her; (e) for
purposes of settlement, the questions of law and fact common to the Settlement Class Members
predominate over any questions affecting any individual Settlement Class Member; and (f) for
purposes of settlement, a class action is superior to the other available methods for the fair and
efficient adjudication of the controversy. The Court also concludes that, because this Action is being
settled rather than litigated, the Court need not consider manageability issues that might be presented
by the trial of a nationwide class action involving the issues in this case. See Amchem Prods., Inc. v.
Windsor, 521 U.S. 591, 620 (1997). In making these findings, the Court has exercised its discretion
in conditionally certifying the Settlement Class on a nationwide basis. See Hanlon v. Chrysler Corp.,
150 F.3d 1011 (9th Cir. 1998).
5.

The Court appoints the law firm of Baron & Budd, P.C. as counsel for the Class

(“Class Counsel”). For purposes of these settlement approval proceedings, the Court finds that this
law firm is competent and capable of exercising its responsibilities as Class Counsel. The Court
designates named Plaintiff Claire Delacruz as the representative of the Settlement Class.
6.

The Final Fairness Hearing shall be held before this Court on May 15, 2014 at 2:00

p.m. to determine whether the First Amended Settlement Agreement And Release is fair, reasonable,
and adequate and should receive final approval. The Court will rule on Class Counsel’s application
for an award of attorneys’ fees, costs, and expenses (the “Fee Application”) at that time. Papers in
support of final approval of the First Amended Settlement Agreement And Release and the Fee
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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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Application shall be filed with the Court according to the schedule set forth in Paragraph 15 below.
The Final Fairness Hearing may be postponed, adjourned, or continued by order of the Court. After
the Final Fairness Hearing, the Court may enter a Final Order and Judgment in accordance with the
First Amended Settlement Agreement And Release that will adjudicate the rights of the Settlement
Class Members (as defined in the Settlement Agreement And Release) with respect to the claims
being settled.
7.

proceedings necessary to carry out or enforce the terms and conditions of the First Amended
Settlement Agreement And Release and this Order, are stayed.
8.

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And Release. As soon as possible after the entry of this Order, but not later than December 12, 2013,
CytoSport will coordinate with the Settlement Administrator concerning notice to the Settlement
Class as follows:
(a)

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described in Exhibit F to the Settlement Agreement; and, in addition, posting of the mutually agreedupon press release described in Exhibit F on the websites of both Class Counsel and Defendant.;
(b)

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providing a link in the Long Form Notice and the Summary Notice to a

settlement website to be designed and administered by the Settlement Administrator that will contain
the settlement documents (including but not limited to the Long Form Notice and the Claim Form), a
list of important dates, and any other information to which the parties may agree; and

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commencing publication on the Notice Date (as that term is defined in the First

Amended Settlement Agreement) of the Summary Notice in accordance with the plan of publication

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The Court approves, as to form and content, the Long Form Notice and Summary

Notice, attached as Exhibits “D” and “E,” respectively, to the First Amended Settlement Agreement

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Pending the Final Fairness Hearing, all proceedings in the Action, other than

(c)

having the Settlement Administrator contact by email all of CytoSport’s

customers who purchased the Products during the Class Period for whom CytoSport has valid email
addresses, to provide such customers with the Summary Notice.
9.

The Court finds that the Long Form Notice and Summary Notice are reasonable, that

they constitute due, adequate, and sufficient notice to all persons entitled to receive notice, and that
they meet the requirements of due process and Rule 23 of the Federal Rules of Civil Procedure.
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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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Specifically, the Court finds that the manner of dissemination of the Long Form Notice and Summary
Notice described in Paragraph 8 complies with Rule 23(e) of the Federal Rules of Civil Procedure as
it is a reasonable manner of providing notice to those Settlement Class Members who would be
bound by the settlement. The Court also finds that the manner of dissemination of the Long Form
Notice and Summary Notice described in Paragraph 8 complies with Rule 23(c)(2), as it is also the
best practicable notice under the circumstances, provides individual notice to all Settlement Class
Members who can be identified through a reasonable effort, and is reasonably calculated, under all
the circumstances, to apprise the members of the Settlement Class of the pendency of this Action, the
terms of the settlement, and their right to object to the settlement or exclude themselves from the
Settlement Class. See, e.g., Farinella v. PayPal, Inc., 611 F. Supp. 2d 250, 256-57 (E.D.N.Y. 2009)
(court approved plan disseminating notice by email, internet posting, and publication); In re Grand
Theft Auto Video Game Consumer Litig., 251 F.R.D. 139, 145 (S.D.N.Y. 2008) (same); see also Todd
v. Retail Concepts, Inc., No. 07-0788, 2008 WL 3981593, at *2 (M.D. Tenn. Aug. 22, 2008) (court
approved plan disseminating notice by email, in-store posting, and website posting).
10.

Settlement Class Members will have until March 12, 2014, to submit their Claim

Forms, which is due, adequate, and sufficient time.
11.

Each Settlement Class member who wishes to be excluded from the Settlement Class

and follows the procedures set forth in this Paragraph shall be excluded. Putative members of the
Settlement Class who wish to opt out of the settlement must send a letter by fax, U.S. mail, or e-mail
in the form specified in the First Amended Settlement Agreement And Release and Long Form
Notice to: Delacruz v. CytoSport c/o GCG, P.O. Box 35069, Seattle, WA 98124-3508, postmarked
(or the equivalent for fax or e-mail), with copies to Class Counsel and Defense Counsel, postmarked
(or the equivalent for fax or e-mail) no later than March 12, 2014. All persons or entities who
properly elect to opt out of the settlement shall not be Settlement Class Members and shall relinquish
their rights to benefits with respect to the First Amended Settlement Agreement And Release, should
it be approved.
12.

Any member of the Settlement Class who has not timely submitted a written request

for exclusion from the Settlement Class, and thus is a Settlement Class Member, may object to the
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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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proposed settlement contained in the First Amended Settlement Agreement And Release, the
certification of the Settlement Class, the entry of the Final Order and Judgment, the amount of fees
requested by Class Counsel, and/or the amount of the incentive awards requested by the named
Plaintiffs. Any Settlement Class Member who intends to object to the First Amended Settlement
Agreement And Release must send a written objection by fax, U.S. mail, or e-mail to the Settlement
Administrator, with copies to Class Counsel and Defense Counsel at the addresses set forth below,
postmarked (or the equivalent for fax or e-mail) no later than March 12, 2014. Settlement Class
Members who fail to file and serve timely written objections in the manner specified above shall be
deemed to have waived all objections and shall be foreclosed from making any objection (whether by
appeal or otherwise) to the settlement. No Settlement Class Member shall be entitled to be heard at
the Final Fairness Hearing (whether individually or through separate counsel) or to object to the
settlement, and no written objections or briefs submitted by any Settlement Class Member shall be
received or considered by the Court at the Final Fairness Hearing, unless written notice of the
objecting class member’s intention to appear at the Final Fairness Hearing and copies of any written
objections and/or briefs shall have been filed with the Court and served on Class Counsel and
Defense Counsel by March 12, 2014. Settlement Class Members who object must set forth their full
name, current address, and telephone number.
Settlement Administrator

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Delacruz v. CytoSport
c/o Garden City Group
P.O. BOX 35069
Seattle, WA 98124-3508
Counsel for the Class

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Baron & Budd, P.C.
Roland Tellis
Mark Pifko
15910 Ventura Boulevard, Suite 1600
Encino, California 91436
Telephone: [phone]
Facsimile: 818.986.9698
E-mail: [e-mail]
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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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Counsel for CytoSport

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Gibson, Dunn & Crutcher LLP
G. Charles Nierlich
Timothy W. Loose
Matthew L. Berde
555 Mission St., Suite 3000
San Francisco, CA 94105
Telephone: [phone]
Facsimile: 415.393.8306
E-mail: [e-mail]

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13.

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Application, shall be filed with the Court on or before April 11, 2014.
15.

completed within 45 days thereafter;
(b)

(c)

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(d)

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All objections to the First Amended Settlement Agreement And Release and

written notices of the objecting class member’s intention to appear at the Final Fairness Hearing shall
be filed and served no later than 90 days following the Notice Date;
(e)

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Class Counsel shall file their Fee Application on or before 75 days following

the Notice Date;

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Settlement Class members may submit Claim Forms or may submit requests

for exclusion postmarked no later than 90 days following the Notice Date;

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The Notice Date shall occur on or before December 12, 2014 and the notice

provided in accordance with Exhibit F to the First Amended Settlement Agreement shall be

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In summary, the dates of performance are as follows:
(a)

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Papers in support of final approval of the First Amended Settlement Agreement And

Release, and in response to objections to the Settlement Agreement And Release or the Fee

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Class Counsel shall file their Fee Application on or before February 25, 2014.

14.

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Papers in support of final approval of the First Amended Settlement

Agreement And Release, and in response to objections to the Settlement Agreement And Release or
the Fee Application, shall be filed with the Court on or before 120 days following the Notice Date;
and
(f)

The Final Fairness Hearing shall be held on May 15, 2014 at 2:00 p.m.

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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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shown, without further notice to the Settlement Class. Settlement Class Members must check the
settlement website at www.CytoSportSettlement.com regularly for updates and further details
regarding extensions of these dates of performance.
17.

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the First Amended Settlement Agreement And Release, or the First Amended Settlement Agreement
And Release is terminated pursuant to its terms for any reason, then the following shall apply:
(a)

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referred to for any purposes whatsoever, and shall not be admissible or discoverable in this or any
other proceeding;
(b)

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never been certified pursuant to this First Amended Settlement Agreement And Release and such
findings had never been made;
(c)

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as to any facts or claims alleged or asserted in the Action, or in any actions or proceedings, whether
civil, criminal or administrative;
(d)

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Nothing in this Order or pertaining to the First Amended Settlement

Agreement And Release, including any of the documents or statements generated or received
pursuant to the claims administration process, shall be used as evidence in any further proceeding in
this case; and

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Nothing contained in this Order is, or may be construed as, a presumption,

concession or admission by or against CytoSport or Plaintiff of any default, liability or wrongdoing

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The conditional certification of the Settlement Class pursuant to this Order

shall be vacated automatically, and the Actions shall proceed as though the Settlement Class had

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All orders and findings entered in connection with the Settlement Agreement

And Release shall become null and void and have no force and effect whatsoever, shall not be used or

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In the event the First Amended Settlement Agreement And Release is not approved by

the Court, or for any reason the parties fail to obtain a Final Order and Judgment as contemplated in

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These dates of performance may be extended by order of the Court, for good cause

(e)

All of the Court’s prior Orders having nothing whatsoever to do with class

certification shall, subject to this Order, remain in force and effect.
18.

Pending final determination of whether the proposed settlement should be approved,

no Settlement Class Member directly, derivatively, in a representative capacity, or in any other
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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW

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capacity, shall commence or continue any action against any of the Released Parties (as that term is
defined in the First Amended Settlement Agreement And Release) in any court or tribunal asserting
any of the Released Claims (as that term is defined in the First Amended Settlement Agreement And
Release).
19.

Garden City Group, Inc. is hereby appointed as Settlement Administrator for this

settlement and shall perform all of the duties of the Settlement Administrator set forth in the First
Amended Settlement Agreement And Release.
20.

Class Counsel and Defense Counsel are hereby authorized to use all reasonable

procedures in connection with approval and administration of the settlement that are not materially
inconsistent with this Order or the First Amended Settlement Agreement And Release, including
making, without further approval of the Court, minor changes to the form or content of the Long
Form Notice, Summary Notice, and other exhibits that they jointly agree are reasonable or necessary.
IT IS SO ORDERED, this 18th day of November, 2013

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__________________________________________
THE HONORABLE CLAUDIA WILKEN
UNITED STATES DISTRICT COURT JUDGE

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[PROPOSED] ORDER PRELIMINARILY APPROVING CLASS ACTION
SETTLEMENT, PROVISIONALLY CERTIFYING CLASS, AND SCHEDULING HEARING

Case No.: 4:11-cv-03532-CW