Hohenberg v. Ferrero USA, Inc

Filing 154

ORDER denying 145 Motion to Vacate Final Approval of Class Settlement. Signed by Judge Marilyn L. Huff on 12/03/2012. (All non-registered users served via U.S. Mail Service)(ag) (jrl).

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1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 SOUTHERN DISTRICT OF CALIFORNIA 9 CASE NO. 11-CV-205-H (KSC) 10 11 IN RE FERRERO LITIGATION ORDER DENYING MOTION TO VACATE FINAL APPROVAL OF CLASS SETTLEMENT 12 13 14 15 On November 5, 2012, Objectors Courtney Drey and Andrea Pridham filed a motion 16 to vacate the Court’s order approving the class settlement pursuant to Federal Rule of Civil 17 Procedure 60(b). (Doc. No. 145-1.) Plaintiffs Athena Hohenberg and Laura Rude-Barbato 18 and Defendant Ferrero USA, Inc. filed a joint opposition on November 19, 2012. (Doc. No. 19 151.) Drey and Pridham filed their reply on November 28, 2012.1 (Doc. No. 152.) For the 20 reasons set forth below, the Court denies Objectors’ motion. Background 21 22 This is a consolidated consumer class action lawsuit brought on behalf of people who 23 have purchased Ferrero’s Nutella® spread after relying on allegedly deceptive and misleading 24 labeling and advertisements. (Doc. No. 14, Cons. Compl.) After two settlement conferences 25 before the magistrate judge, as well as a private mediation with a retired district judge, the 26 parties reached an agreement to settle the claims. (Doc. No. 127 at p. 6.) On January 23, 2012, 27 1 28 Per Civil Local Rule 7.1.e.3, Objectors were required to file their reply on or before November 26, 2012. The Court exercises its discretion pursuant to Civil Local Rule 1.1.d and accepts Objectors’ untimely filing. However, the Court instructs Objectors and their counsel to strictly adhere to this Court’s local rules if they should make any subsequent filings in this case. -1- 1 the Court granted preliminary approval to the proposed settlement. (Doc. No. 114.) On June 2 8, 2012, class members Courtney Drey and Andrea Pridham filed objections to the proposed 3 settlement, including an objection as to the adequacy of the Weston Firm to represent the class. 4 (Doc. No. 123.) On July 9, 2012, the Court held a fairness hearing to decide whether to grant 5 final approval to the proposed settlement. (Doc. No. 128.) Counsel for Objectors Drey and 6 Pridham appeared at the hearing. (Doc. No. 127.) After considering all objections, the Court 7 granted final approval of the proposed settlement. (Doc. No. 127.) Objectors Drey and 8 Pridham filed a notice of appeal on August 7, 2012. (Doc. No. 130.) Discussion 9 10 I. Jurisdiction 11 “Once an appeal is filed, the district court no longer has jurisdiction to consider motions 12 to vacate judgment.” Davis v. Yageo Corp., 481 F.3d 661, 685 (9th Cir. 2007). “However, 13 a district court may entertain and decide a Rule 60(b) motion after notice of appeal is filed if 14 the movant follows a certain procedure, which is to ‘ask the district court whether it wishes to 15 entertain the motion, or to grant it,’” and then file a motion in the appellate court to remand the 16 case. Id. (quoting Gould v. Mut. Life Ins. Co. of N.Y., 790 F.2d 769, 772 (9th Cir. 1986)). 17 This procedure is often referred to as seeking an indicative ruling. Fed. R. Civ. P. 62.1 18 advisory committee’s note. Upon a request for an indicative ruling, the district court may “(1) 19 defer considering the motion; (2) deny the motion; or (3) state either that it would grant the 20 motion if the court of appeals remands for that purpose or that the motion raises a substantial 21 issue.” Fed. R. Civ. P. 62.1. 22 As Objectors Drey and Pridham filed their Rule 60(b) motion after they filed a notice 23 of appeal, the Court lacks jurisdiction to grant the motion. Davis, 481 F.3d at 685. Therefore, 24 the Court’s jurisdiction is limited to that provided in Rule 62.1. 25 II. Rule 60(b) Motion to Vacate 26 The decision whether to vacate a prior judgment is committed to the sound discretion 27 of the district court. Price v. Seydel, 961 F.2d 1470, 1473 (9th Cir. 1992). Rule 60(b) provides 28 that a court “may relieve a party or its legal representative from a final judgment, order, or -2- 1 proceeding”2 on the following grounds: 2 (1) mistake, inadvertence, surprise, or excusable neglect; 3 (2) newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether previously called intrinsic or extrinsic), misrepresentation, or misconduct by an opposing party; 6 (4) the judgment is void; 7 (5) the judgment has been satisfied, released, or discharged; it is based on an earlier judgment that has been reversed or vacated; or applying it prospectively is no longer equitable; or (6) any other reason that justifies relief. 4 5 8 9 10 Fed. R. Civ. P. 60(b). 11 Objectors argue that newly-discovered evidence seriously calls into question the 12 adequacy of the Weston Firm to represent the class. (Doc. No. 145-1.) The newly-discovered 13 evidence includes a September 14, 2010 order in Red v. Unilever PLC, No. 12-387, 2010 WL 14 3629689 (N.D. Cal. Sep. 14, 2010), an August 24, 2010 order in Levitt v. Yelp!, No. 1- 15 1321/10-2351 (N.D. Cal. Aug. 24, 2010), and a September 30, 2010 order in The Weston Firm, 16 P.C. v. Reese Richman LLP, No. 10-1694 (S.D. Cal. Sep. 30, 2010). Id. As to Unilever, 17 Objectors highlight allegations made by the Beck & Lee firm that the Weston Firm, in a 18 different case, had offered a “kickback” to an individual in return for serving as a named 19 plaintiff, had promised one of its paralegals a “finder’s fee” in exchange for “signing up” a 20 named plaintiff, and had compensated its non-lawyer employees on a percentage basis from 21 settlement proceeds. (Doc. No. 145-1, Ex. A at p. 2.) Objectors also point out that the Court 22 expressed concerns regarding the Weston Firm’s ability to hold fees in trust. (Id. at p. 5) 23 (noting the Weston Firm’s fee dispute with the Beck & Lee firm and appointing a special 24 master). As to Yelp!, Objectors point out that the court noted the inexperience of the Weston 25 Firm in obtaining class certification and subsequent litigation and appointed the Ongaro firm 26 as class counsel. (Doc. No. 145-1, Ex. B at p. 2.) As to Weston Firm, Objectors highlight the 27 2 28 Objectors request leave to intervene pursuant to Rule 24 in the event that as non-parties they lack standing to bring their 60(b) motion. (Doc. No. 145-1 at p. 8.) The parties do not oppose. (Doc. No. 151 at p. 5, n.3.) Therefore, the Court grants Objectors request to intervene for the limited purpose of maintaining their 60(b) motion. Fed. R. Civ. P. 24(b). -3- 1 fact that the Court expressed concerns that the Weston Firm “circumvent[ed] the rulings of 2 other district courts” in requesting a temporary restraining order enjoining the Beck & Lee firm 3 from communicating with clients of the Weston Firm. (Doc. No. 145-1, Ex. C at p. 3.) 4 Objectors argue that this newly-discovered evidence, coupled with the issues raised in their 5 prior objections, raises a substantial question that the Weston Firm engaged in similar 6 misconduct in this case. (Doc. No. 145-1 at p. 7.) 7 After considering Objectors’ arguments and the issues discussed in the cases cited, the 8 Court concludes that Objectors have failed to raise a substantial question as to the adequacy 9 of the Weston Firm in this case. The alleged misconduct of the Weston Firm in all three cases 10 cited by Objectors stemmed from the circumstances surrounding Weston Firm’s various 11 disputes with the Beck & Lee firm. (See Doc. No. 145-1, Exs. A-C.) This litigation appears 12 to be outside the scope of that dispute, and there is no evidence to suggest that the Weston 13 Firm engaged in any misconduct in this case. The issues raised in the “newly-discovered 14 evidence” are insufficient to raise a question of impropriety here. 15 In addition, the Court previously considered and overruled objections to the adequacy 16 of the Weston Firm. (Doc. No. 127.) The argument that the Weston Firm is not experienced 17 with class certification and subsequent litigation is mitigated by the fact that the parties have 18 reached a settlement that the Court determined “provid[es] an appropriate remedy to class 19 members” taking “into account the strength of Defendant’s defenses and obstacles to class- 20 wide recovery.” (Doc. No. 127 at p. 7.) Thus, the Weston Firm has demonstrated its ability 21 to obtain appropriate relief, allegations of inexperience notwithstanding. 22 23 24 25 26 27 28 Conclusion For the foregoing reasons, the Court denies Objectors’ motion to vacate its prior judgment granting final approval to class settlement. IT IS SO ORDERED. DATED: December 3, 2012 _______________________________ MARILYN L. HUFF, District Judge UNITED STATES DISTRICT COURT -4-

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