Coulter-Owens v. Rodale, Inc.

Filing 44

ORDER Granting 42 Motion for Preliminary Approval of Class Action Settlement Agreement, Conditionally Certifying Settlement Class, Appointing Class Representative, Appointing Class Counsel,Approving Notice Plan and Setting Final Approval Hearing for 9/7/2016 at 10:00 a.m.. Signed by District Judge Robert H. Cleland. (LWag)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
ROSE COULTER-OWENS,
individually, and on behalf of all
others similarly situated,
Plaintiff,
Case No. 2:14-cv-12688

v.
RODALE INC.,
Defendant.

ORDER GRANTING PRELIMINARY APPROVAL
OF CLASS ACTION SETTLEMENT AGREEMENT, CONDITIONALLY
CERTIFYING SETTLEMENT CLASS, APPOINTING CLASS
REPRESENTATIVE, APPOINTING CLASS COUNSEL, AND
APPROVING NOTICE PLAN
Pending before the court is a proposed class action settlement. (Dkt.
# 42.) The attached Class Action Settlement Agreement, together with the
related exhibits, sets forth the terms and conditions for the proposed
settlement and dismissal of the action with prejudice as to Defendant. The
court has considered the proposed settlement, preliminarily approves of it,
and conditionally certifies the settlement class, appoints a class
representative and class counsel, and approves the notice plan with some
modifications,
Accordingly, IT IS ORDERED:
1.

Terms and phrases in this Order shall have the same meaning
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as ascribed to them in the Settlement Agreement.
2.

The Parties have moved the court for an order approving the

settlement of the Action in accordance with the Settlement Agreement,
which, together with the documents incorporated therein, sets forth the
terms and conditions for a proposed settlement and dismissal of the Action
with prejudice, and the court having read and considered the Settlement
Agreement, hereby preliminarily approves the Settlement Agreement
subject to the various modifications explained in this Order and subject to
the Final Approval and Fairness Hearing.
3.

This court finds that it has jurisdiction over the subject matter of

this action and over all Parties to the Action.
4.

The court finds that, notwithstanding the concerns highlighted

below, and subject to the Final Approval Hearing, the Settlement
Agreement is fair, reasonable, and adequate, within the range of possible
approval, and in the best interests of the Settlement Class set forth below.
The court further finds that the Settlement Agreement substantially fulfills
the purposes and objectives of the class action, and provides substantial
relief to the Settlement Class without the risks, burdens, costs, or delay
associated with continued litigation, trial, and/or appeal. The court also
finds that the Settlement Agreement (a) is the result of arm’s-length
negotiations between experienced class action attorneys; (b) is sufficient to
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warrant notice of the settlement and the Final Approval Hearing to be
disseminated to the Settlement Class; (c) meets all applicable requirements
of law, including Federal Rule of Civil Procedure 23 and the Class Action
Fairness Act (“CAFA”), 28 U.S.C. § 1715; and (d) is not a finding or
admission of liability by the Defendant or any other parties.
Certification of the Settlement Class
5.

For purposes of settlement only: (a) Jay Edelson, Ari J. Scharg,

and Benjamin S. Thomassen of Edelson PC are appointed Class Counsel
for the Settlement Class; and (b) Rose Coulter-Owens is named Class
Representative. The court finds that these attorneys are competent and
capable of exercising the responsibilities of Class Counsel and that Plaintiff
Coulter-Owens will adequately protect the interests of the Settlement Class
defined below.
6.

For purposes of settlement only, the court conditionally certifies

the following Settlement Class as defined in the Settlement Agreement:
All persons with Michigan street addresses who, between
July 1, 2009 and the date of Preliminary Approval,
purchased a subscription to a Rodale Publication.
Final certification of the class will occur after the Final Approval
Hearing, when the court enters a final judgment in this case.
7.

The court finds, notwithstanding the concerns highlighted

below, and subject to the Final Approval Hearing, that the Settlement
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Agreement is fundamentally fair, adequate, and reasonable, and that the
Settlement Class satisfies the requirements of Rule 23 of the Federal Rules
of Civil Procedure, specifically, that: the Settlement Class is so numerous
that joinder of all members is impracticable; there are questions of fact and
law common to the Settlement Class (e.g., whether Defendant obtained
consent before disclosing to third parties Plaintiff’s and the Settlement
Class’s Subscriber Information, whether Defendant’s disclosure of
Plaintiff’s and the Settlement Class Members’ Magazine Subscriber
Information violated the Michigan Video Rental Privacy Act, M.C.L. §§
445.1712, et al. (“VRPA”), and whether Plaintiff and the Settlement Class
members are entitled to uniform statutory damages under the VRPA); the
claims of the Class Representative are typical of the claims of the members
of the Settlement Class; the Class Representative and Class Counsel will
fairly and adequately protect the interests of the members of the Settlement
Class; common questions of law or fact predominate over questions
affecting individual members; and a class action is a superior method for
fairly and efficiently adjudicating the Action.
8.

The court takes this opportunity to raise, for proponents of

settlement and certification, certain concerns with the proposed class and
settlement, which the court expects to address at the Final Approval
Hearing.
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a. The proposed settlement contemplates a $5,000 incentive
award for the named plaintiff in this action; this payment
raises serious concerns about the adequacy of the named
plaintiff as a representative of the class. The Sixth Circuit
has held that adequacy of a class member’s representation
is based on two factors: “1) the representatives must have
common interests with the unnamed members of the class,
and 2) it must appear that the representatives will vigorously
prosecute the interests of the class through qualified
counsel.” In re Dry Max Pampers Litigation, 724 F.3d 713,
721 (6th Cir. 2013) (quoting Vassalle v. Midland Funding
LLC, 708 F.3d 747, 755 (6th Cir. 2013)). “[T]he linchpin of
the adequacy requirement is the alignment of interests and
incentives between the representative plaintiffs and the rest
of the class.” Id. (quoting Dewey v. Volkswagen
Aktiengesellschaft, 681 F.3d 170, 183 (3d Cir. 2012)). The
Sixth Circuit has also expressed the “sensibl[e] fear that
incentive awards may lead named plaintiffs . . . to
compromise the interest of the class for personal gain.” Id.at
722 (quoting Hadix v. Johnson, 322 F.3d 895, 897 (6th Cir.
2003)). This fear is at its height when the incentive award
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makes the class representative whole or more than whole,
as is the case here, because in such cases the class
representative has no reason to care whether the award to
class members provides adequate relief. Id. However, an
incentive award may be appropriate where it is tailored to
compensate a class representative for her actions, time, and
effort in prosecuting the action. See Enterprise Energy Corp.
v. Columbia Gas Transmission Corp., 137 F.R.D. 240, 250
(S.D. Ohio 1991). Class counsel and proponents of the class
should be prepared to justify, with specific facts, the
incentive payment proposed here as compensation for work
done. Otherwise, such an award risks rendering the
proposed class representative inadequate under Rule 23.
b. Plaintiff indicates that the proposed settlement will result in
an estimated $100 award to each class member. The Motion
in support of preliminary settlement approval, however,
provides inadequate evidence that such an estimate has any
basis in fact or is a truly considered estimate. Footnote three
to the motion states merely, “[t]his estimation is based upon
typical participation rates in consumer class action
settlements.” (Pl.’s Mot. 2 n.3.) The court has a duty to
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evaluate the settlement’s fairness by weighing the plaintiff’s
likelihood of success on the merits against the amount and
form of relief offered in the settlement.” Int’l Union, United
Auto.. Aerospace & Agr. Implement Workers of Am. v. Gen.
Motors Corp., 497 F.3d 615, 631 (6th Cir. 2007). Without
sound justification for the estimated payment to each class
member, the court cannot say whether class members are
likely to receive a fair deal. The court expects such
justification to be offered at the Fairness Hearing.
9.

Should the Settlement Agreement not receive the court’s final

approval, should final approval be reversed on appeal, or should the
Settlement Agreement otherwise fail to become effective, the proposed
Class Representative would once again bear the burden of establishing the
propriety of class certification. In such case, neither the certification of the
Settlement Class for settlement purposes, nor any other act relating to the
negotiation or execution of the Settlement Agreement shall be considered
as a factor in connection with any class certification issue(s).
Notice and Administration
10.

The court approves, subject to the few notations below, the

form, content, and distribution, the Claim Form attached to the Settlement
Agreement as Exhibit A, the Notice Plan and all forms of Notice to the
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Settlement Class as set forth in the Settlement Agreement and Exhibits B,
C, and D thereto, and finds that such Notice is the best notice practicable
under the circumstances, and that the Notice complies fully with the
requirements of the Federal Rules of Civil Procedure. However, Class
Counsel should be sure to take note of and amend notice as to the
following issues:
a. As proposed, the current notice lists this court’s former
address and courtroom number. The Final Approval and
Fairness Hearing will be held at the United States District
Court in the Federal Building, 526 Water Street, Port Huron,
MI 48060. Notice should be amended to reflect the proper
address.
b. Notice should make explicit that class members are not to
contact the court with questions, but should direct all
inquiries to class counsel, instead.
11.

The court also finds that the Notice, with the above corrections,

constitutes valid, due and sufficient notice to all persons entitled thereto,
and meets the requirements of Due Process. The court further finds that
the Notice is reasonably calculated to, under all circumstances, reasonably
apprise members of the Settlement Class of the pendency of this action,
the terms of the Settlement Agreement, and the right to object to the
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settlement and to exclude themselves from the Settlement Class. In
addition, the court finds that no notice other than that specifically identified
in the Settlement Agreement is necessary in this Action. The parties, by
agreement, may revise the Notice and Claim Form in ways that are not
material, or in ways that are appropriate to update those documents for
purposes of accuracy or formatting for publication.
12.

The court approves the request for the appointment of Epiq

Systems, Inc. as Settlement Administrator of the Settlement Agreement.
13.

Pursuant to paragraph 4.1 of the Settlement Agreement, the

Settlement Administrator is directed to publish the Notice and Claim Form
on the Settlement Website and to send direct notice via U.S. Mail and email
in accordance with the Notice Plan called for by the Settlement Agreement.
The Settlement Administrator shall also maintain the Settlement Website to
provide full information about the Settlement and allow for the filing of
claims online.
14.

Not less than fourteen (14) days prior to the Final Approval

Hearing, counsel for Defendants and Class Counsel shall jointly file with
the court an affidavit from a representative of the Settlement Administrator
confirming that the plan for disseminating Notice has been accomplished in
accordance with this Order and the Settlement Agreement. The affidavit
should state how many class members were identified on the “Class List,”
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how many class members were notified by email, and how many class
members were notified by U.S. mail.
Exclusion
15.

Members of the Class who wish to receive benefits under the

Settlement Agreement must complete and submit their Claim Form(s) in
accordance with the instructions contained therein. All Claim Forms must
be postmarked or received by the Settlement Administrator within forty-five
(45) days after the date of the entry of the Final Judgment.
16.

Members of the Settlement Class who wish to exclude

themselves from the Class may do so if, on or before the
Objection/Exclusion Deadline of seventy-seven (77) days after entry of this
order they comply with the exclusion procedures set forth in the Settlement
Agreement and Notice. Any members of the Class so excluded shall
neither be bound by the terms of the Settlement Agreement nor entitled to
any of its benefits.
17.

Any members of the Settlement Class who elect to exclude

themselves or “opt out” of the Settlement Agreement must file a written
request with the Settlement Administrator, received or postmarked no later
than the Objection/Exclusion Deadline. The request for exclusion must
comply with the exclusion procedures set forth in the Settlement
Agreement and Notice and include the Settlement Class member’s name
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and address, the name of the Rodale publication to which he or she is a
subscriber, a signature, the name and number of the case, and a statement
that he or she wishes to be excluded from the Settlement Class for the
purposes of this Settlement. So called “mass” or “class” opt-outs shall not
be allowed.
18.

Members of the Settlement Class who opt out of the Settlement

Agreement will relinquish their rights to benefits under the Settlement
Agreement and will not release their claims. However, members of the
Settlement Class who fail to submit a valid and timely request for exclusion
shall be bound by all terms of the Settlement Agreement and the Final
Judgment, regardless of whether they have requested exclusion from the
Settlement Agreement.
Objections
19.

Any members of the Settlement Class who have not timely filed

a request for exclusion may object to the fairness, reasonableness, or
adequacy of the Settlement Agreement or to a Final Judgment being
entered dismissing the Action with prejudice in accordance with the terms
of the Settlement Agreement, or to the attorneys’ fees and expense
reimbursement sought by Class Counsel in the amounts specified in the
Notice, or to the award to the Class Representative as set forth in the
Notice and Settlement Agreement. At least fourteen (14) days prior to the
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Objection/Exclusion Deadline, papers supporting the Fee Award shall be
filed with the court and posted to the settlement website. Members of the
Class may object on their own, or may do so through separate counsel at
their own expense.
20.

To object, members of the Class must sign and file a written

objection no later than on or before the Objection/Exclusion Deadline of
seventy-seven (77) days after entry of this Order. To be valid, the objection
must comply with the objection procedures set forth in the Settlement
Agreement and Notice, and include his or her name and address; an
explanation of the basis upon which he or she claims to be a Settlement
Class Member, including the Rodale publication to which he or she is or
was a subscriber; a signature; all grounds for the objection, including all
citations to legal authority and evidence supporting the objection; the name
and contact information of any and all attorneys representing, advising, or
in any way assisting him or her in connection with the preparation or
submission of the objection or who may profit from the pursuit of the
objection (the “Objecting Attorneys”); and a statement indicating whether
he or she intends to appear at the Final Approval Hearing (either personally
or through counsel who files an appearance with the court in accordance
with Eastern District of Michigan Local Rules). If a Settlement Class
Member or any of the Objecting Attorneys has objected to any class action
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settlement where the objector or the Objecting Attorneys asked for or
received any payment in exchange for dismissal of the objection, or any
related appeal, without any modification to the settlement, then the
objection must include a statement identifying each such case by full case
caption.
21.

Members of the Class who fail to file and serve timely written

objections in compliance with the requirements of this paragraph and the
Settlement Agreement shall be deemed to have waived any objections and
shall be foreclosed from making any objections (whether by appeal or
otherwise) to the Settlement Agreement or to any of the subjects listed in
paragraph 23, below.
22.

To be valid, objections must be filed with the court and sent to

Class Counsel: Ari J. Scharg of Edelson PC, 350 North LaSalle, Suite
1300, Chicago, IL 60654, and to Defendant’s Counsel: Natalie Spears of
Dentons US LLP, 233 South Wacker Drive, Suite 5900, Chicago, IL 60606631. In addition, any objections made by a Class member represented by
counsel must be filed through the court’s CM/ECF system.
Final Approval Hearing
23.

The Final Approval Hearing shall be held before this court on

September 7, 2016 at 10 a.m. at the United States District Courthouse
at 526 Water Street, Port Huron, MI 48060 to determine (a) whether the
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proposed settlement of the Action on the terms and conditions provided for
in the Settlement Agreement is fair, reasonable, and adequate and should
be given final approval by the court; (b) whether a judgment and order of
dismissal with prejudice should be entered; (c) whether to approve the
payment of attorneys’ fees and expenses to Class Counsel; and (d)
whether to approve the payment of an incentive award to the Class
Representative. The court may adjourn the Final Approval Hearing without
further notice to members of the Settlement Class.
24.

Class Counsel shall file papers in support of their Fee Award

and Class Representative’s Incentive Award (collectively, the “Fee
Petition”) with the court on or before sixty-three (63) days after entry of this
Order, (i.e., 14 days before the Objection/Exclusion Deadline).
25.

Papers in support of final approval of the Settlement Agreement

and any supplementation to the Fee Petition shall be filed with the court on
or before 14 days before the Final Approval Hearing.
Further Matters
26.

All further proceedings in the Action are ordered stayed until

Final Judgment or termination of the Settlement Agreement, whichever
occurs earlier, except for those matters necessary to obtain and/or
effectuate final approval of the Settlement Agreement.
27.

Members of the Settlement Class shall be bound by all
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determinations and judgments in the Action concerning the Action and/or
Settlement Agreement, whether favorable or unfavorable.
28.

If the Settlement Agreement is not approved by the court in

complete accordance with its terms, each party will have the option of
having the Action revert to its status as if the Settlement Agreement had
not been negotiated, made, or filed with the court. In such event, the parties
will retain all rights as if the Settlement Agreement was never agreed upon.
29.

In the event that the Settlement Agreement is terminated

pursuant to the provisions of the Settlement Agreement or for any reason
whatsoever the approval of it does not become Final then (i) the Settlement
Agreement shall be null and void, including any provision related to the
award of attorneys’ fees, and shall have no further force and effect with
respect to any party in this Action, and shall not be used in this Action or in
any other proceeding for any purpose; (ii) all negotiations, proceedings,
documents prepared, and statements made in connection therewith shall
be without prejudice to any person or party hereto, shall not be deemed or
construed to be an admission by any party of any act, matter, or
proposition, and shall not be used in any manner or for any purpose in any
subsequent proceeding in this Action or in any other action in any court or
other proceeding, provided, however, that the termination of the Settlement
Agreement shall not shield from subsequent discovery any factual
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information provided in connection with the negotiation of this Settlement
Agreement that would ordinarily be discoverable but for the attempted
settlement; (iii) other than as expressly preserved by the Settlement
Agreement in the event of its termination, the Settlement Agreement shall
have no further force and effect with respect to any party and shall not be
used in the Action or any other proceeding for any purpose; and (iv) any
party may elect to move the court pursuant to the provisions of this
paragraph, and none of the non-moving parties (or their counsel) shall
oppose any such motion.
IT IS SO ORDERED, this 3rd day of May, 2016.

S/Robert H. Cleland
ROBERT H. CLELAND
UNITED STATES DISTRICT JUDGE
Dated: May 3, 2016
I hereby certify that a copy of the foregoing document was mailed to counsel of record
and/or pro se parties on this date, May 3, 2016, by electronic and/or ordinary mail.
S/Lisa Wagner
Case Manager and Deputy Clerk
[phone]

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