Temporary Services Incorporated v. American International Group Inc et al

Filing 373

ORDER granting 372 Joint MOTION for Approval of Cy Pres Distribution. Signed by Honorable Joseph F. Anderson, Jr. on 02/25/2014.(bshr, )

UNITED STATES DISTRICT COURT
IN THE DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION
Temporary Services, Incorporated, a South )
Carolina Corporation, and Charleston
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Steel & Metal Company, on behalf of
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themselves, and all others similarly situated, )
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Plaintiffs,
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v.
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American International Group, Inc.,
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Commerce and Industry Insurance
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Company, and American Home Assurance )
Company,
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Defendants.
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)

C/A No.: 3:08-00271-JFA

ORDER

Jointly, the parties have moved for the approval of a cy pres distribution consistent with
the terms of the Settlement Agreement executed by the parties in the above-styled case and
finally approved by the Court on September 14, 2012. (Dkt. 370) Specifically, the parties request
the Court approve the disbursement of $537,923.62 to the South Carolina Appleseed Legal
Justice Center. For reasons stated below, the joint motion to approve the disbursement of
moneys to the specified cy pres recipient is GRANTED.
The Eighth Circuit Court of Appeals has provided guidance for the review of proposed cy
pres distributions in class action settlements.
The term ‘cy pres' is derived from the Norman French expression
cy pres comme possible, which means ‘as near as possible.’ The cy
pres doctrine originated as a rule of construction to save a
testamentary charitable gift that would otherwise fail, allowing the
next best use of the funds to satisfy the testator's intent as near as
possible. Courts have also utilized cy pres distributions where class
members are difficult to identify or where they change constantly,

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or where there are unclaimed funds. In these cases, the court,
guided by the parties' original purpose, directs that the unclaimed
funds be distributed for the indirect prospective benefit of the
class.
In re Airline Ticket Comm'n Antitrust Litig., 268 F.3d 619, 625 (8th Cir. 2001).
In this case, the parties have produced evidence that the settlement administrator has used
all reasonable efforts to ensure that the settlement benefits have been disbursed to the class
members. Nevertheless, $537,923.62 remains in the escrow account possessed by the settlement
administrator. As a result, the Court must analyze whether the parties’ proposed cy pres
distribution would be appropriate.
The Plaintiffs’ original purpose in bringing their suit was to recover monetary damages
allegedly resulting from inflated workers compensation premiums. Long ago, the South Carolina
Supreme Court set forth the policy objectives of South Carolina’s workers compensation laws.
Compensation laws constitute a form of social legislation and were
enacted primarily for the benefit, protection and welfare of
working men and their dependents, to relieve them of the
uncertainties of a trial in a suit for damages, to cast upon the
industry in which they are employed a share of the burden
resulting from industrial accidents, and to prevent the burden of
injured employees and their dependents becoming charges on
society.
Cokeley v. Robert Lee, Inc., 14 S.E.2d 889, 893-94 (S.C. 1941). A recipient of the unclaimed
funds remaining in the possession of the settlement administrator must be chosen with these
underlying policy objectives in mind.
I find that the parties’ jointly proposed cy pres recipient, the South Carolina Appleseed
Legal Justice Center, is an appropriate beneficiary of the remaining settlement funds which
satisfies the underlying policy objectives of workers compensation laws “as near as possible.”
Appleseed is a private, non-profit law firm dedicated to providing representation, technical
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assistance, and advocacy to low and moderate income citizens of South Carolina and has been
successfully providing these services for thirty-five years. These services extend to pro bono
legal representation in state and federal courts, legislative and administrative policy advocacy, as
well as education, training, and co-counseling in the community and media. Appleseed asserts
that its staff is dedicated to working to ensure that the holistic needs of the community are met.
These needs include adequate health care and education, consumer protection, safe affordable
housing, nutrition, and income supports.
Based upon the foregoing, I find that disbursement of remaining settlement funds to the
South Carolina Appleseed Legal Justice Center will inure to “the benefit, protection and welfare
of working men and their dependents.” Id. at 893-94. Therefore, the parties’ joint motion to
approve the disbursement of $537,923.62 to the South Carolina Appleseed Legal Justice Center
is granted.
IT IS SO ORDERED.

February 25, 2014
Columbia, South Carolina

Joseph F. Anderson, Jr.
United States District Judge

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