Sanders et al v. RBS Citizens, N.A.

Filing 124

ORDER Granting Joint 123 Motion for Approval of Cy Pres Beneficiaries of Residual Settlement Funds. Signed by Judge Cynthia Bashant on 2/5/21. (dlg)

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UNITED STATES DISTRICT COURT

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FOR THE SOUTHERN DISTRICT OF CALIFORNIA

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LINDA SANDERS, on behalf of herself
and all others similarly situated,

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Plaintiff,

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v.

Case No. 13-cv-03136-BAS-RBB
ORDER GRANTING JOINT
MOTION FOR APPROVAL OF
CY PRES BENEFICIARIES OF
RESIDUAL SETTLEMENT FUNDS
(ECF No. 123)

RBS CITIZENS, N.A.,

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Defendant.

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Before the Court is the parties’ Joint Motion for Approval of Cy Pres Beneficiaries

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of Residual Settlement Funds (“Joint Motion”). (ECF No. 123.) For the foregoing reasons,

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the Court GRANTS the Joint Motion.

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I.

BACKGROUND

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Plaintiff Linda Sanders brought this action on behalf of a class under the Telephone

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Consumer Protection Act (“TCPA”), 47 U.S.C. § 227 et seq., on December 20, 2013. (ECF

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No. 1.) The parties ultimately reached a settlement, which establishes in relevant part that

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“[a]ny funds not paid out as the result of uncashed settlement checks shall be paid out as a

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cy pres award, to a recipient agreed to by the parties and approved by the Court.”

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(Settlement Agreement § 11.02, ECF No. 104-3.) The agreement also states that on the

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final distribution date, or 210 days after the date which the last check for an award was

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issued, the Claims Administrator will pay the remaining amount in the Settlement Fund to
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one or more cy pres recipients. (Id. § 8.05(f).) The Court granted preliminary approval of

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the settlement on July 1, 2016 and final approval on January 27, 2017. (ECF Nos. 107,

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117.)

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Now before the Court is the parties’ Joint Motion designating cy pres beneficiaries.

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The parties state that the claims administrator has issued 40,661 settlement checks to

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facilitate disbursement of the funds, of which 37,650 were cashed. (Decl. of Alex Thomas

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¶ 2, ECF No. 123-2.) The 3,011 remaining were not cashed within 180 days or have been

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voided, leaving $164,065.89 remaining for cy pres distribution. (Id.) The parties have

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agreed to two cy pres beneficiaries, one chosen by Plaintiff’s counsel and one chosen by

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Defendant’s counsel: (1) the University of Santa Clara Law School’s (“SCU”) Privacy Law

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Certificate and High Tech Law Institute; and (2) the Local Initiatives Support Corporation

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(“LISC”). (Decl. of Douglas J. Campion ¶ 4, ECF No. 123-3.)

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II.

LEGAL STANDARD

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“[T]he ‘cy pres doctrine allows a court to distribute unclaimed or nondistributable

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portions of a class action settlement fund to the ‘next best’ class of beneficiaries.’” Lane

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v. Facebook, Inc., 696 F.3d 811, 819 (9th Cir. 2012) (quoting Nachshin v. AOL, LLC, 663

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F.3d 1034, 1036 (9th Cir. 2011)). “The district court’s review of a class action settlement

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that calls for a cy pres remedy is not substantially different from that of any other class-

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action settlement except that the court should not find the settlement fair, adequate, and

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reasonable unless the cy pres remedy ‘account[s] for the nature of the plaintiffs’ lawsuit,

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the objectives of the underlying statutes, and the interests of the silent class members[.]”

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Id. (quoting Nachshin). “The court has ‘broad discretionary powers in shaping’ a cy pres

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award.” In re Easysaver Rewards Litig., 906 F.3d 747,761 (9th Cir. 2018), cert. denied

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sub nom. Perryman v. Romero, 139 S. Ct. 2744 (2019) (citing Six (6) Mexican Workers v.

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Ariz. Citrus Growers, 904 F.2d 1301, 1307 (9th Cir. 1990)).

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III.

ANALYSIS

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A.

Nature of the Lawsuit

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This TCPA was brought on behalf of a class claiming that Defendants made

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automated calls to their cell phones to collect past due debts. (Compl. ¶ 1, 29–32, ECF No.

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1.) Thus, this case touches on both privacy rights and financial literacy.

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The proposed cy pres fund recipients align with these interests. The SCU Privacy

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Law Certificate and High Tech Law Institute provide academic and extracurricular

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opportunities focused on helping students develop expertise in the area of privacy law, and

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the cy pres funds will help support the students, faculty, and staff in this endeavor. (See

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Decl. of Eric Goldman (“Goldman Decl.”) ¶¶ 2–9, 12, ECF No. 123-4.) LISC is a non-

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profit corporation in New York that “provid[es] grants, loans, and equity investments and

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technical assistance to hundreds of organizations in urban and rural communities

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throughout the country.” (Decl. of Maurice A. Jones ¶¶ 2, 4, ECF No. 123-5.) The

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organization plans to use cy pres funds “to provide employment and career services,

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financial education, and credit re-building for low-income borrowers.” (Id. ¶ 9.)

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B.

Objective of the TCPA

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“[I]n enacting the TCPA, Congress made specific findings that ‘unrestricted

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telemarketing can be an intrusive invasion of privacy’ and are a ‘nuisance.’” Van Patten

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v. Vertical Fitness Grp., LLC, 847 F.3d 1037, 1043 (9th Cir. 2017). As previously stated,

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the SCU programs educate law students in privacy law, with the goal of furthering privacy

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rights of consumers. The Court finds that the work done by SCU “is directly responsive to

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the issues underlying this litigation.” See Easysaver, 906 F.3d at 762.

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Similarly, because the phone calls at issue in this matter were made in furtherance

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of debt collection efforts, LISC’s concentration on developing financial stability also

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corresponds to the purpose of the statute because improving financial literacy “will benefit

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settlement class members by reducing future debt collection calls.” See In re Midland

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Credit Mgmt. Inc., Tel. Consumer Prot. Act Litig., No. 10-cv-2261-MMA (MDD), 2018

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WL 4927982, (S.D. Cal. Oct. 10, 2018) (quotations omitted).
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C.

Interest of Silent Class Members

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Lastly, the Court finds that the interests of silent class members would be advanced

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by distributing cy pres funds to SCU and LISC.

The SCU’s programs involve

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comprehensive training and education of attorneys regarding the protection and

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enforcement of privacy laws. (Goldman Decl. ¶¶ 2–9). The Court therefore agrees that

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the funds will be used, as the parties state, “to advance the privacy interests of residential

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and cellular telephone subscribers” and “to promote and preserve the privacy rights” of all

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class members and consumers at large. (Goldman Decl. ¶¶ 12–18.) LISC targets the

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underlying cause of the automated calls in this case: the existence of overdue debt. By

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helping individuals develop the skills necessary to keep current on their financial

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obligations, LISC reduces the likelihood that class members and, more broadly, any

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individuals will be on the receiving end of automated debt collection calls.

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IV.

CONCLUSION AND ORDER

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Having considered the parties’ Joint Motion and finding the proposed cy pres

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beneficiaries appropriate, the Court hereby GRANTS the Joint Motion. KCC Class Action

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Services, LLC, as the settlement administrator, IS HEREBY ORDERED to promptly

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distribute the remaining balance in the Cash Component of the Common Fund as a cy pres

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distribution to the (1) University of Santa Clara Law School’s Privacy Law Certificate and

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High Tech Law Institute and (2) Local Initiatives Support Corporation, which charitable

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organizations shall share equally in the cy pres distribution.

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IT IS SO ORDERED.

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DATED: February 5, 2021

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