Davidson v. Henkel Corporation et al

Filing 157

JUDGMENT AND ORDER APPROVING FINAL SETTLEMENT. Signed by District Judge Gershwin A. Drain. (TBan)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

JOHN B. DAVIDSON, individually and on behalf
of others similarly situated,
Plaintiff,
v.

Case No. 12-cv-14103

HENKEL CORPORATION, HENKEL OF AMERICA,
INC., & HENKEL CORPORATION DEFERRED
COMPENSATION AND SUPPLEMENTAL
RETIREMENT PLAN and its COMMITTEE AS
ADMINISTRATOR OF THE HENKEL
CORPORATION DEFERRED COMPENSATION AND
SUPPLEMENTAL RETIREMENT PLAN,

UNITED STATES DISTRICT COURT JUDGE
GERSHWIN A. DRAIN
UNITED STATES MAGISTRATE JUDGE
DAVID R. GRAND

Defendants.
/
JUDGMENT AND ORDER APPROVING FINAL SETTLEMENT
WHEREAS, the Named Plaintiff John B. Davidson, on behalf of himself and members of
the class (“Class”) and Henkel Corporation, Henkel of America, Inc., and Henkel Corporation
Deferred Compensation and Supplemental Retirement Plan and its Committee as Administrator
of the Henkel Corporation Deferred Compensation and Supplemental Retirement Plan
(collectively “Henkel” or “Defendants” and together with Named Plaintiff and Class, collectively
the “Settling Parties”) entered into a Settlement Agreement dated September 18, 2015, that
provides for the payment of $3,350,000 (inclusive of attorneys’ fee and costs) and a complete
dismissal against Defendants on the terms and conditions set forth in the Settlement Agreement,
subject to the approval of this Court (the “Settlement”);
WHEREAS, by Order dated September 28, 2015 (the “Preliminary Approval Order”),
this Court (a) preliminarily approved the Settlement; (b) ordered that notice of proposed

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Settlement be provided to members of the Class; (c) provided Class Members with the
opportunity to object to the proposed Settlement; and (d) scheduled a hearing regarding final
approval of the Settlement;
WHEREAS, due and adequate notice has been given to the Class; and
WHEREAS, the Court conducted a hearing on December 8, 2015 (“Final Approval
Hearing”) to (a) determine whether the Settlement should be approved by the Court as fair,
reasonable and adequate; (b) determine whether judgment should be entered pursuant to the
Settlement Agreement, inter alia, dismissing the Action against Defendants with prejudice
and extinguishing and releasing all Released Claims (as defined therein) against all Henkel
Releasees; (c) rule on Class Counsel’s application for an award of Attorneys’ Fees and the
reimbursement of Litigation Expenses and Notice and Administration Costs; (d) rule on the
Named Plaintiff’s request for a Service Award; and (e) rule on such other matters as the
Court may deem appropriate.
The Court has considered all matters submitted to it at the Final Approval Hearing
and otherwise, the pleadings on file, the applicable law, and the record.
NOW, THEREFORE, IT IS HEREBY ORDERED THAT:
1.

The Court, for purposes of this Final Order adopts all defined terms as set forth in the
Settlement Agreement, and incorporates them herein by reference as if fully set forth.

2.

The Court has jurisdiction over the subject matter of the Action, and all matters relating
to the Settlement, as well as personal jurisdiction over all of the Settling Parties and
each of the Class Members.

3.

The Notice and the notice methodology implemented pursuant to the Settlement
Agreement and the Court’s orders: (i) constituted the best notice practicable under

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the circumstances to all persons within the definition of the Class; (ii) constituted notice
that was reasonably calculated, under the circumstances, to apprise Class Members of the
pendency of the Action, of the effect of the Settlement Agreement, including releases,
of their right to object to the proposed Settlement, of their right to participate in the
Settlement, and of their right to appear at the Final Approval Hearing; (iii) were
reasonable and constituted due, adequate and sufficient notice to all persons or entities
entitled to receive notice; and (iv) met all applicable requirements of the Federal Rules
of Civil Procedure, the United States Constitution (including the Due Process Clause),
the Rules of the Court and any other applicable law.
4.

Pursuant to and in accordance with Rule 23 of the Federal Rules of Civil Procedure,
the Settlement, including, without limitation, the Settlement Amount, the releases set
forth therein, and the dismissal with prejudice of the Released Claims against the
Released Parties set forth therein, is finally approved as fair, reasonable and adequate.
The Settling Parties are hereby authorized and directed to comply with and to
consummate the Settlement in accordance with the Settlement Agreement, and the
Clerk of this Court is directed to enter and docket j u d g m e n t in the Action
accordingly.

5.

The Action and the Complaint and all claims included therein, as well as all Released
Claims (defined in the Settlement Agreement), are dismissed with prejudice as against
each and all of the Henkel Releasees (defined in the Settlement Agreement). All Class
Members on behalf of themselves and their respective predecessors, successors and
assigns, are hereby deemed to have finally, fully, and forever released, relinquished,
and discharged all of the Henkel Releasees from the Released Claims.

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6.

Except as otherwise provided in the Settlement Agreement, the Settling Parties are to
bear their own attorneys’ fees and costs.

7.

Notwithstanding Paragraph 5, nothing in this Final Order shall bar any action or claim by
any of the Settling Parties to enforce or effectuate the terms of the Settlement Agreement
or this Final Order.

8.

This Final Order and the Settlement Agreement, including any provisions contained in
the Settlement Agreement, any negotiations, statements, or proceedings in connection
therewith, or any action undertaken pursuant thereto:
a. shall not be admissible in any action or proceeding for any reason, other than an
action to enforce the Settlement terms; and
b. is not, and shall not be deemed, described, construed, offered or received as
evidence of any presumption, concession, or admission by any person or entity of
the truth of any fact alleged in the Action; the validity or invalidity of any claim
or defense that was or could have been asserted in the Action or in any litigation;
the amount of damages, if any, that would have been recoverable in the Action; or
any liability, negligence, fault, or wrongdoing of any person or entity.

9.

Henkel Corporation, or its designee, shall be responsible for making all payments and
distributions from the Gross Settlement Fund pursuant to the Plan of Allocation and as
provided in the Settlement Agreement.

10.

The Plan of Allocation is approved as fair and reasonable, and Class Counsel is directed to
administer the Settlement in accordance with the terms and provisions of the Settlement
Agreement.

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11.

The Court further finds that the Named Plaintiff and Class Counsel adequately
represented the Class Members in entering into and implementing the Settlement.

12.

No Class Member shall have any claim against Class Counsel or Defendants based on
the distributions made substantially in accordance with the Settlement A g r e e m e n t
and Plan of Allocation as approved by the Court and further orders of the Court.

13.

Any order approving or modifying the Plan of Allocation set forth in the Notice, the
application by Class Counsel for an award of Attorneys’ F ees and reimbursement of
Litigation Expenses and Notice and Administration Costs, or the application for Named
Plaintiff’s Service Award, shall not disturb or affect the finality of this Final Order or the
Settlement Agreement.

14.

The Notice stated that Class Counsel would move for Attorneys’ F ees in an amount
not to exceed $1,290,000 from the Gross Settlement Fund, and Litigation Expenses in
an amount not to exceed $36,000. In their Motion for Final Approval, Class Counsel
requested Attorneys’ F ees of $1,286,023.08 from the Gross Settlement Fund and
Litigation Expenses of $35,858.92.

15.

Class Counsel is hereby awarded a total of _______ in Attorneys’ Fees and _____ in
Litigation Expenses pursuant to 29 U.S.C. §1132(a) and (g), which sum the Court finds to
be fair and reasonable. The foregoing award of fees and expenses shall be paid to Class
Counsel, The Miller Law Firm, P.C., from the Gross Settlement Fund, and such payment
shall be made at the time and in the manner provided in the Settlement Agreement.

16.

The Named Plaintiff, John B. Davidson as a Service Award is awarded $15,000 for his
service, costs and expenses directly relating to the representation of the Class, which sum
the Court finds to be fair and reasonable. The foregoing award shall be paid to the

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Named Plaintiff from the Gross Settlement Fund, and such payment shall be made at the
time and in the manner provided in the Settlement Agreement.
17.

In making this award of A t torneys’ Fees and Litigation Expenses and the Service
Award to be paid from the Gross Settlement Fund, the Court has considered and found
that:
a. The Settlement includes a gross cash award of $3,350,000 (three million, three
hundred and fifty thousand dollars), which includes Attorneys’ Fees and Litigation
Expenses and provides for recovery of an amount equal to each Class Member’s
decreased benefits attributable to Defendants’ failure to withhold FICA taxes in
accordance with the Special Timing Rule, along with 5% interest on past damages
and a 40% tax gross up as defined in the Plan of Allocation, which will provide
substantial benefit to the Class Members;
b. The Settlement also provides for valuable, yet unquantified relief in the form of an
abatement of the assessment of FICA to the Nonqualified Benefits received by any
Surviving Spouse of any deceased Class Member effective January 1, 2015. The
Settlement further provides for indemnification of the Surviving Spouse in the event
the IRS, an administrative agency, court, audit or Henkel determines that Defendants
must assess FICA to the Nonqualified Benefits received by the Surviving Spouse
after January 1, 2015. The Settlement additionally provides for indemnification of
any Class Member in the event the IRS, an administrative agency or court determines
that any Class Member owes FICA on Nonqualified Benefits for any of the tax years
prior to 2011, arising from Defendants’ failure to properly determine FICA liability
on Class Member Nonqualified Benefits for those tax years.

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c. Notice was disseminated to Class Members stating that Class Counsel were
moving for Attorneys’ F ees not to exceed $ 1 , 2 9 0 , 0 0 0 from the Gross
Settlement Fund, and for Litigation Expenses in an amount not to exceed
$36,000. Class Counsel

filed their application for Attorneys’ Fees and

reimbursement of Litigation Expenses 14 days prior to the deadline for objections
in this Action, and ____objection was filed by a Class Member against the terms
of the proposed Settlement or Attorneys’ Fees and Litigation Expenses
contained in the Notice and Class Counsel’s application;
d. Class Counsel has conducted the litigation and achieved the Settlement in good faith
and with skill, perseverance and diligent advocacy;
e. The Action involves complex factual and legal issues and was actively prosecuted
for over three years, proceeded until trial was imminent, and, in the absence of a
settlement, would involve further lengthy proceedings with uncertain resolution of
the complex factual and legal issues;
f. The parties filed multiple motions including a motion to dismiss, numerous
discovery motions, a motion for class certification and motions for summary
judgment and partial summary judgment, along with extensive supplemental
briefing;
g. Had Class Counsel not achieved the Settlement there would remain a significant risk
that the Named Plaintiffs and the Class may have recovered substantially less from
the Defendants;

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h. The amount of Attorneys’ Fees and Litigation Expenses awarded from the Gross
Settlement Fund are fair and reasonable under all of the circumstances and
consistent with awards in similar cases; and
i. The Service Award is fair and reasonable considering the time commitment and
diligence of the Named Plaintiff in prosecuting this action on behalf of the Class
Members and is consistent with service awards in similar cases.
18.

Without affecting the finality of this Final Order in any way, the Court reserves
exclusive and continuing jurisdiction over the Action for purposes of: (a) supervising
the implementation, enforcement, construction, and interpretation of the Settlement
Agreement, the Plan of Allocation, and this Final Order; (b) supervising the distribution
of the Gross Settlement Fund and/or the Net Settlement Fund; and (c) resolving any
dispute regarding a party’s right to terminate pursuant to the terms of the Settlement
Agreement.

19.

In the event that the Settlement is terminated or does not become Final in accordance with
the terms of the Settlement Agreement for any reason whatsoever, then this Final Order
shall be rendered null and void and shall be vacated to the extent provided by and in
accordance with the Settlement Agreement, and, in such event, all orders entered and
releases delivered in connection herewith shall be null and void to the extent provided by
and in accordance with the Settlement Agreement.

20.

There is no reason for delay in the entry of this Final Order and immediate entry by the
Clerk of the Court is expressly directed pursuant to Rule 54(b) of the Federal Rules
of Civil Procedure.

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21.

Therefore, the Motion for Attorney Fees and Costs and Service Award and the Motion for
Approval of Settlement and Plan of Allocation of Settlement Proceeds are GRANTED.

IT IS SO ORDERED.
Dated: December 8, 2015
Detroit, MI

/s/Gershwin A Drain
HON. GERSHWIN A. DRAIN
United States District Court Judge

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