Van Orden et al v. Healthlink, Inc. et al

Filing 547

MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that the parties shall confer and attempt to reach agreement with respect to any changes to the proposed class notice that may be necessary in light of this Order, and on or before July 21, 2016, shall fi le a copy of their proposed revised class notice or, if they cannot reach agreement, their respective positions. Following review and approval of the class notice, the Court will grant the parties' joint motion to approve and direct notice to the certified class of the proposed settlement, and will schedule a fairness hearing on the proposed settlement. IT IS FURTHER ORDERED that John H. Quinn, III is appointed as counsel to represent the class representatives who object to the proposed settlement and any other class members who object to the proposed settlement and wish to be represented by Mr. Quinn. IT IS FURTHER ORDERED that Eric Selig's oral motion to withdraw as lead class counsel is DENIED without prejudice. Signed by District Judge Audrey G. Fleissig on July 7, 2016. (BRP)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
JOHN VAN ORDEN, et al.,
Plaintiffs,
v.
KEITH SCHAFER, et al.,
Defendants.

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Case No. 4:09CV00971 AGF

MEMORANDUM AND ORDER
This matter is before the Court on the parties’ joint motion (Doc. No. 526) to approve
and direct notice to the certified class of the parties’ proposed settlement regarding
remedies.1 The Court held a status conference on this motion on May 25, 2016. Shortly
before the status conference, the Court learned that class counsel and the class
representatives disagreed about whether the proposed settlement was in the best interest of
the class. Lead class counsel, Eric Selig, and all supporting class counsel except one
attorney (John H. Quinn) informed the Court that they believed the proposed settlement was
fair, reasonable, and adequate, and should proceed to a fairness hearing.2 However, Mr.
Quinn objected to the settlement, ultimately on behalf of all of the class representatives.

1

At the parties’ request, the Court bifurcated trial in this case into two phases: liability
and remedies. After a bench trial on liability, the Court found that Defendants were liable
on some but not all of Plaintiffs’ claims. The parties’ proposed settlement addresses
remedies for the claims on which the Court found Defendants liable.
2

At the status conference and in light of the disagreement among class counsel, Mr.
Selig also made an oral motion to withdraw as lead class counsel in this case. The Court
deferred ruling on the oral motion until it considered the matter.

Before lead class counsel filed the joint motion to approve and direct notice of the proposed
settlement to the class, at least one class representative had expressed approval of the
proposed settlement. However, that class representative later changed his mind, and at the
time of the status conference in this case, all class representatives were opposed to the
proposed settlement. The class representatives also, by letter to class counsel, expressed
their desire that Mr. Quinn represent them in objecting to the proposed settlement.
At the May 25 status conference, Mr. Quinn expressed a desire to file a short brief
regarding whether class counsel had authority to enter the proposed settlement, whether the
Court should schedule a fairness hearing, and if so, the proper role going forward for any
class counsel who objected to the proposed settlement; and the Court set a deadline for that
brief. The Court also permitted any other counsel of record to respond to Mr. Quinn’s brief
within one week.
Mr. Quinn has submitted a brief arguing that the motion to approve the proposed
settlement notice should be denied but suggesting that, if the proposed settlement proceeds
to a fairness hearing, class counsel opposed to the proposed settlement (i.e., Mr. Quinn)
should be permitted to represent any objecting class members, including the class
representatives. Lead class counsel and Defendants have responded to Mr. Quinn’s brief,
arguing that the proposed settlement is authorized and should proceed to a fairness hearing.
Lead class counsel also agrees that the Court may appoint Mr. Quinn as counsel for the
objecting class representatives
Upon review of the parties’ submissions and for the reasons stated below, the Court
is inclined to grant the parties’ joint motion to approve and direct notice to the certified class

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of the proposed settlement. However, the Court will ask the parties to confer and attempt to
reach agreement with respect to any changes to the proposed notice that may be necessary in
light of this Order. Following any necessary revision to the proposed notice, the Court will
grant the parties’ joint motion to approve and direct notice to the certified class of the
proposed settlement, and will schedule a fairness hearing on the proposed settlement. The
Court will also appoint Mr. Quinn to represent the objecting class representatives, and any
other objecting class members who wish to be represented by him, at the fairness hearing.
DISCUSSION
“Inherent in any class action is the potential for conflicting interests among the class
representatives, class counsel, and absent class members.” Maywalt v. Parker & Parsley
Petroleum Co., 67 F.3d 1072, 1077 (2d Cir. 1995). But “[t]he ultimate responsibility to
ensure that the interests of class members are not subordinated to the interests of either the
class representatives or class counsel rests with the district court.” Id. Thus, where there is
a dispute between class counsel and the class representatives, or among class counsel, as to
the course to be followed, including with regard to settlement, the decision “cannot rest
entirely with either the named plaintiffs or with class counsel.” Pettway v. Am.Cast Iron
Pipe Co., 576 F.2d 1157, 1177 (5th Cir. 1978). The decision must be left to the district
court, which must consider the best interests of the class as a whole. Maywalt, 67 F.3d at
1077; see also Manual for Complex Litigation (Fourth) §§ 21.641, 21.642 (noting that,
although class counsel must “discuss with class representatives the terms of any settlement
offered to the class,” neither class counsel nor class representatives have “veto power” over
settlement of class actions).

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A district court may approve a class action settlement only if it is “fair, reasonable,
and adequate.” Fed. R. Civ. P. 23(e)(2). A settlement can be fair notwithstanding a large
number of objectors and even when all named plaintiffs oppose the settlement. See
Marshall v. Nat’l Football League, 787 F.3d 502, 513 (8th Cir. 2015) (citing Elliott v.
Sperry Rand Corp., 680 F.2d 1225, 1226–27 (8th Cir. 1982) (finding no abuse of discretion
in district court’s approval of class action settlement even though both named plaintiffs and
790 of approximately 3,000 members objected to it)). In evaluating the fairness of a
settlement, “the court should take into account not only the presentations of counsel but also
information from other sources, such as comments from class representatives and class
members, presentations by objections, [and] the court’s own knowledge of the case . . . .”
Manual for Complex Litigation (Fourth) § 21.641.
The Court believes that the best course of action to protect the interests of the class as
a whole is to provide notice and a copy of the proposed settlement to the class and to
schedule a fairness hearing at which the presentations of counsel and any objections may be
heard fully and on the record. However, the Court agrees with Mr. Quinn and lead class
counsel that any objecting class representatives should be separately represented at such
hearing. See, e.g., Elliott, 680 F.2d at 1226 (affirming approval of class action settlement
over objections of the class representatives where the district court held a fairness hearing,
objections were heard on the record, and the objecting class representatives were
represented by separately retained counsel); Flinn v. FMC Corp., 528 F.2d 1169, 1174 (4th
Cir. 1975) (same).

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The Court also agrees that Mr. Quinn may represent the objecting class
representatives, and any other objecting class members who wish to be represented by him,3
at the fairness hearing. “[T]he traditional rules that have been developed in the course of
attorneys’ representation of the interests of clients outside of the class action context should
not be mechanically applied to the problems that arise in the settlement of class action
litigation.” In re Agent Orange Prod. Liab. Litig., 800 F.2d 14, 19 (2d Cir. 1986). Rather,
in deciding whether attorneys who have represented the class may thereafter represent only
a faction of the class opposed to a proposed class settlement, the Court must “balanc[e] the
interests of the various groups of class members and of the interest of the public and the
court in achieving a just and expeditious resolution of the dispute.” Id. Relevant
considerations include prejudice to the parties, the ease with which class members could
obtain new counsel, the factual and legal complexity of the case, and the time that it would
take new counsel to familiarize himself with the proceedings. Id. Given the complexity of
the factual and legal issues in this case, the time it would take new counsel to familiarize
himself with the proceedings, which have continued over the course of seven years, and the
absence of any prejudice identified by the parties, the Court believes that Mr. Quinn should
be appointed to represent the objecting class representatives and any other objecting class
members who wish to be represented by him.
CONCLUSION
For the reasons set forth above,

3

The parties may desire to revise the proposed class notice to reflect that objecting
class members are free to retain their own counsel or to request to be represented by Mr.
Quinn.
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IT IS HEREBY ORDERED that the parties shall confer and attempt to reach
agreement with respect to any changes to the proposed class notice that may be necessary in
light of this Order, and on or before July 21, 2016, shall file a copy of their proposed
revised class notice or, if they cannot reach agreement, their respective positions. Following
review and approval of the class notice, the Court will grant the parties’ joint motion to
approve and direct notice to the certified class of the proposed settlement, and will schedule
a fairness hearing on the proposed settlement.
IT IS FURTHER ORDERED that John H. Quinn, III is appointed as counsel to
represent the class representatives who object to the proposed settlement and any other class
members who object to the proposed settlement and wish to be represented by Mr. Quinn.
IT IS FURTHER ORDERED that Eric Selig’s oral motion to withdraw as lead
class counsel is DENIED without prejudice.

_______________________________
AUDREY G. FLEISSIG
UNITED STATES DISTRICT JUDGE
Dated this 7th day of July, 2016.

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