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1 been or could have been asserted in the Litigation based upon the
2 Defendants’ furnishing of consumer reports that contained or were
3 alleged to contain false or misleading reporting of debts, accounts,
4 judgments, or public records, or other obligations, that had been
5 discharged in bankruptcy or their alleged failure to have properly
6 reinvestigated such inaccuracies, by Plaintiffs or the 23(b)(3)
7 Settlement Class Members or any of their respective heirs, spouses,
8 executors, administrators, partners, attorneys, predecessors, successors,
9 assigns, agents and/or representatives, and/or anyone acting or
10 purporting to act on their behalf. Released Claims include, but are not
11 limited to, all claimed or unclaimed compensatory damages, damages
12 for emotional distress, statutory damages, consequential damages,
13 incidental damages, treble damages, punitive and exemplary damages,
14 as well as all claims for equitable, declaratory or injunctive relief under
15 any federal or state statute or common law or other theory that was
16 alleged or could have been alleged based on the facts forming the basis
17 for the Litigation, including but not limited to any and all claims under
18 deceptive or unfair practices statutes, or any other statute, regulation or
19 judicial interpretation. Released Claims further include interest, costs
20 and fees arising out of any of the claims asserted or that could have
21 been asserted in the Litigation. Notwithstanding the foregoing,
22 nothing in this Settlement Agreement shall be deemed a release of the
23 Parties’ respective rights and obligations under this Settlement
24 Agreement.
25 1.39 “Released Parties” means and refers to: (a) Equifax and its present,
26 former and future officers, directors, partners, employees, agents,
27 attorneys, servants, heirs, administrators, executors, members, member
28 entities, shareholders, predecessors, successors, affiliates (including,
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1 1.44 “Settlement Web site” means the Internet Web site established by the
2 Settlement Administrator for purposes of facilitating notice to, and
3 communicating with, the 23(b)(3) Settlement Class.
4 1.45 “TransUnion” means TransUnion LLC.
5 1.46 “TransUnion’s Counsel” means Stroock & Stroock & Lavan LLP.
6 1.47 “23(b)(2) Settlement Class” means the same as defined in Section 2.32
7 in the Approval Order Regarding Settlement Agreement and Release
8 entered by the Court in the Litigation on August 19, 2008.
9 1.48 “23(b)(3) Settlement Class” or “23(b)(3) Settlement Class Member”
10 shall mean and refer to all Consumers who have received an order of
11 discharge pursuant to Chapter 7 of the United States Bankruptcy Code
12 and who, any time between and including March 15, 2002 and the
13 present (or, for California residents in the case of TransUnion, any
14 time between and including May 12, 2001 and the present), have been
15 the subject of a Post-bankruptcy Credit Report issued by a Defendant
16 in which one or more of the following appeared:
17 a. A Pre-bankruptcy Civil Judgment that was reported as
18 outstanding (i.e., it was not reported as vacated, satisfied, paid,
19 settled or discharged in bankruptcy) and without information
20 sufficient to establish that it was, in fact, excluded from the
21 bankruptcy discharge;
22 b. A Pre-bankruptcy Installment or Mortgage Loan that was
23 reported as delinquent or with a derogatory notation (other than
24 “discharged in bankruptcy,” “included in bankruptcy” or similar
25 description) and without information sufficient to establish that
26 it was, in fact, excluded from the bankruptcy discharge;
27 c. A Pre-bankruptcy Revolving Account that was reported as
28 delinquent or with a derogatory notation (other than “discharged
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1 proceeding against Defendants. Defendants have denied and continue to deny each
2 and all of the claims and allegations in the Litigation. Neither this Settlement
3 Agreement nor any document referred to herein, nor any action taken to carry out
4 this Settlement Agreement and/or the Settlement, or their willingness to enter into
5 this Settlement Agreement, nor any or all negotiations, communications, and
6 discussions associated with them are, or may be construed as, or may be used in
7 any proceeding as, an admission by or against any or all Defendants of any fault,
8 wrongdoing or liability whatsoever, or any infirmity of any defenses asserted by
9 any or all Defendants
10 2.2 No Admission by Defendants of Elements of Class Certification
11 Defendants deny that a class should be certified other than for purposes of
12 this Settlement and reserve their rights to contest any litigation class motion.
13 Defendants contend that this Litigation could not be certified as a class action under
14 Federal Rule of Civil Procedure 23(b)(3) and, indeed, this Court has issued a
15 written tentative ruling denying certification of a litigation class that had been
16 proposed by Plaintiffs. Nothing in this Settlement Agreement shall be construed as
17 an admission by any Defendant that this Litigation or any similar case is amenable
18 to class certification for trial purposes. Furthermore, nothing in this Settlement
19 Agreement shall prevent any Defendant from opposing class certification or
20 seeking de-certification of the conditionally certified 23(b)(3) Settlement Class if
21 Final Approval of this Settlement is not obtained, or not upheld on appeal,
22 including review by the United States Supreme Court.
23 III. MOTION FOR PRELIMINARY APPROVAL
24 3.1 On or before April 24, 2009, Proposed 23(b)(3) Settlement Class
25 Counsel shall file this Settlement Agreement with the Court together
26 with a motion for Preliminary Approval that seeks entry of an order
27 that would, for settlement purposes only:
28
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1
[Signature]
2
e. Publication Notice: Between August 31, 2009 and September
3
30, 2009, the Settlement Administrator shall cause the
4
Publication Notice (in a form substantially similar to that
5
attached hereto as Exhibit B and approved by the Court) to be
6
published one time in a nationally distributed newspaper or
7
magazine. Not later than seven (7) days before the Final
8
Fairness hearing, the Settlement Administrator shall cause proof
9
of the publication of the Publication Notice to be filed with the
10
Court.
11
f. Telephone Assistance Program: The Settlement Administrator
12
will establish a toll-free telephone number, which will be staffed
13
by the Settlement Administrator, to answer questions from
14
23(b)(3) Settlement Class Members. The toll-free number will
15
provide access to live support, a voice response unit (“VRU”) or
16
a combination of live support and VRU. Not later than seven
17
(7) days before the Final Fairness hearing, the Settlement
18
Administrator will cause proof of the establishment and
19
maintenance of the Telephone Assistance Program to be filed
20
with the Court.
21
4.4 Expenses of Notice and Administration
22
a. All notice, claims and other administration costs, excluding the
23
costs associated with CAFA Notice as described in Section 4.5,
24
shall be invoiced by the Settlement Administrator and paid
25
promptly from the Settlement Fund.
26
b. Within thirty (30) days after the Effective Date, the Settlement
27
Administrator will provide to the 23(b)(3) Settlement Class
28
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1 current postal address, current telephone number, and last four digits of the class
2 member’s Social Security number. The 23(b)(3) Settlement Class shall also be
3 required to select one of the monetary relief options identified in the Mail Notice.
4 Registrations submitted by U.S. mail shall contain the same information contained
5 in the electronic registration form and the 23(b)(3) Settlement Class Member’s
6 signature and shall be mailed to a separate, dedicated post office box established by
7 the Settlement Administrator exclusively for the purpose of receiving such
8 registrations as provided herein.
9 b. Deceased Claimants
10 Claims may be filed by deceased Claimants through representatives of their
11 estate if appropriate documentation is provided. Any claims paid to a deceased
12 Claimant shall be made payable to the estate of the deceased Claimant.
13 c. Determining Adequacy of Claims
14 Registration forms, whether submitted electronically via the Settlement
15 Website or by U.S. Mail, that do not meet the requirements as set forth in this
16 Settlement Agreement and in the registration form instructions shall be rejected.
17 This shall include but is not limited to any failure to provide accurate information,
18 any failure to make the required representations and attestations concerning
19 membership in the 23(b)(3) Settlement Class, and any failure to sign a registration
20 form submitted by U.S. Mail.
21 The Settlement Administrator shall have the authority to determine whether
22 registration by any 23(b)(3) Settlement Class Member is complete and timely. The
23 Settlement Administrator’s determinations in this regard shall be final and non-
24 appealable. Any 23(b)(3) Settlement Class Member whose claim is rejected shall
25 be barred from receiving any payment from the Settlement Fund, but shall in all
26 other respects be bound by the terms of this Settlement Agreement and by the Final
27 Approval Order entered in the Litigation, unless such 23(b)(3) Settlement Class
28 Member has submitted a timely request to opt out pursuant to Subsection 5.2a.
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1 the date set by the Court in its order preliminarily approving this
2 Settlement Agreement.
3 b. All responses to Objections submitted pursuant to Section 5.3a
4 shall be filed by October 30, 2009.
5 VI. FINAL FAIRNESS HEARING AND FINAL APPROVAL
6 6.1 Final Fairness Hearing
7 The Court will hold the Final Fairness Hearing to consider approval of the
8 Settlement of the Litigation as provided for herein on November 9, 2009. On or
9 before October 19, 2009, Proposed 23(b)(3) Settlement Class Counsel shall file a
10 motion for entry of the Final Approval Order. The Parties agree that the Final
11 Approval Order constitutes a dismissal of this Litigation with prejudice.
12 6.2 Final Approval
13 All of the affirmative relief contemplated by this Settlement Agreement is
14 expressly contingent upon the Settlement Agreement receiving the Court’s Final
15 Approval.
16 VII. SETTLEMENT FUND
17 7.1 Creation of and Deposit Into Settlement Fund
18 a. Within ten (10) days following Preliminary Approval, if by that
19 date the Injunctive Relief Fee Agreement has been signed by the
20 Parties to this Agreement, the Parties will petition the Court for
21 approval to deposit the Settlement Fund with the Registry of the
22 Court, pursuant to Fed. R. Civ. P. 67. By the later of (1) seven
23 (7) days thereafter or (2), June 15, 2009, each Defendant shall
24 cause to be deposited into the Registry of the Court an amount
25 equal to fifteen million dollars ($15,000,000.00). The
26 Defendants’ payments are several, and not joint.
27 b. Until such time as the Settlement Fund shall be used or
28 disbursed as provided in this Settlement Agreement and as
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1
Type Amount of Award
2
3. Other Credit Inquires If the Actual Damage Award Claimant’s File
3
shows a Post-bankruptcy Hard Inquiry within
4
six (6) months of the date provided by the
5
Actual Damage Award Claimant, and such
6
Claimant has not opted for an Employment or
7
a Mortgage/Housing award, then the award
8
shall be $150.
9
(iv) The Settlement Administrator shall pay to the Actual
10
Damage Award Claimant the highest award for which he
11
or she is eligible. Awards hereunder shall not be
12
cumulative. The applicable award for each category will
13
be increased or decreased, pro rata, to reflect (i) the
14
number of valid claims in each category of Actual
15
Damage Awards, and (ii) the funds available for
16
distribution to the Actual Damage Award Claimants,
17
including the addition of any unclaimed or uncashed
18
Convenience Awards as set forth in Section 7.7b.
19
(v) If the Settlement Administrator determines that a Actual
20
Damage Award Claimant is ineligible for a Actual
21
Damage Award, then such Actual Damage Award
22
Claimant’s claim shall be converted into a Convenience
23
Award Claim.
24
7.8 Capped Fund
25
Except for the costs of CAFA Notice pursuant to section 4.5 hereof, all of the
26
following must be paid from the $15,000,000.00 (fifteen million dollars) paid into
27
the Settlement Fund by each Defendant: (i) notice and administration costs,
28
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1 including without limitation the costs incurred by each Defendant in providing any
2 additional information requested by Plaintiffs and/or 23(b)(3) Settlement Class
3 Counsel, which shall be reimbursed promptly to each Defendant from the
4 Settlement Fund; (ii) payments to the Claimants; and (iii) payments to 23(b)(3)
5 Settlement Class Counsel for Monetary Relief Fees. The Parties and their
6 respective counsel agree that under no circumstances will each Defendant pay or
7 cause to be paid more than $15,000,000.00 (fifteen million dollars) pursuant to this
8 Settlement.
9 VIII. RELEASE OF CLAIMS
10 8.1 Release of All Claims
11 Upon the Effective Date, Plaintiffs and each member of the 23(b)(3)
12 Settlement Class who has not opted out and his or her respective spouses, heirs,
13 executors, administrators, representatives, agents, attorneys, partners, successors,
14 predecessors and assigns and all those acting or purporting to act on their behalf
15 acknowledge full satisfaction of, and shall be conclusively deemed to have fully,
16 finally and forever settled, released and discharged the Released Parties of and from
17 all Released Claims. Subject to the Court’s approval, all 23(b)(3) Settlement Class
18 Members shall be bound by this Settlement Agreement and all of their Released
19 Claims shall be dismissed with prejudice and released as against the Released
20 Parties, even if they never received actual notice of the Settlement prior to the
21 hearing on final approval of the Settlement.
22 8.2 Waiver of California Civil Code Section 1542
23 Plaintiffs, for themselves and for each 23(b)(3) Settlement Class Member,
24 acknowledge that they are aware that they may hereafter discover facts in addition
25 to or different from those that they or 23(b)(3) Settlement Class Counsel now
26 knows or believes to be true with respect to the subject matter of these releases, but
27 it is their intention to, and they do hereby, upon the Effective Date of this
28 Settlement Agreement, fully, finally and forever settle and release any and all
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1 under this Settlement Agreement to any of the Defendants in the event that any two
2 of the three Defendants exercises their right to terminate this Settlement Agreement
3 pursuant to Section 9.1 hereof, and Plaintiffs exercise their termination right within
4 thirty (30) days of the second Defendant’s exercise of its termination right.
5 9.4 Plaintiffs’ Right To Seek Modification Of This Settlement Agreement
6 Plaintiffs shall have the unilateral and unfettered right to seek from the Court
7 a modification of this Settlement Agreement in the event that: (a) one of the three
8 Defendants exercises its right to terminate this Settlement Agreement pursuant to
9 Section 9.1 hereof; or (b) prior to the dissemination of class notice, one or more of
10 the Defendant’s class lists provided to the Settlement Administrator pursuant to
11 Section 4.1 hereof exceeds twelve million (12,000,000) class members. Plaintiffs’
12 right to seek such modification extends to, but is not limited to, the amount and
13 manner of payments of Convenience Awards or Actual Damage Awards, the
14 manner and method of notice to the Class, and the general administration of the
15 Settlement, but shall expressly exclude any modification to the scope of the releases
16 provided herein or any modification to the amounts paid by Defendants as provided
17 herein.
18 9.5 The failure of any Court to approve the Monetary Relief Fees or the
19 Injunctive Relief Fees in the requested amounts or any amounts whatsoever, shall
20 not be grounds for Named Plaintiffs or Proposed 23(b)(3) Settlement Class Counsel
21 to terminate this Settlement Agreement.
22 9.6 Effect of Termination on This or Future Litigation
23 If this Settlement Agreement is terminated and only as to those Parties to the
24 extent the Settlement Agreement has been terminated as to them:
25 a. the class-certification portions of the Settlement Agreement
26 shall have no further force and effect and shall not be offered in
27 evidence or used in the Litigation or any other proceeding;
28
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1 b. counsel for the Parties shall seek to have any Court orders,
2 filings, or other entries in the Court’s file that result from this
3 Settlement Agreement set aside, withdrawn, and stricken from
4 the record;
5 c. the Settlement Agreement and all negotiations, proceedings, and
6 documents prepared, and statements made in connection with
7 either of them, shall be without prejudice to any party and shall
8 not be deemed or construed to be an admission or confession by
9 any Party of any fact, matter, or proposition of law; and
10 d. the Parties shall stand in the same procedural position as if the
11 Settlement Agreement had not been negotiated, made, or filed
12 with the Court.
13 9.7 Effect of Termination on Monies Paid by Defendants Pursuant to
14 Settlement Agreement
15 If this Settlement Agreement is terminated and only as to those Defendants to
16 the extent that the Settlement Agreement is terminated as to some of them: The
17 Settlement Fund, including interest earned, less Taxes, Tax Expenses, and notice,
18 claims, and other administration costs (including fees, costs, and other expenses of
19 the Court Registry) that have been properly disbursed pursuant to this Settlement
20 Agreement, shall be returned to such Defendant(s) and such Defendant’s insurers in
21 equal proportions to their contributions into the Settlement Fund.
22 X. PUBLIC STATEMENTS
23 10.1 The Parties will negotiate and agree upon the language that may be
24 used in press releases and other forms of public statements concerning the
25 Settlement that would be issued prior to entry by the Court of the Final Approval
26 Order.
27 The Parties and/or their counsel shall make no statements to any third party
28 regarding the Settlement prior to entry by the Court of the Final Approval Order,
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1 without the reasonable consent of the other Parties or his, her or its counsel, unless
2 such statements are reasonably necessary in effecting the terms of this Settlement
3 Agreement, or are required by law, including, without limitation, any disclosure
4 obligations imposed on Defendants by federal or state securities or tax laws.
5 Subsequent to the entry by the Court of a Final Approval Order, no party shall
6 make any public statements concerning this Settlement or this Litigation that
7 contains disparaging language of any of the Parties or their counsel.
8 10.2 Proposed 23(b)(3) Settlement Class Counsel and all Defendants’
9 Counsel agree that all extra-judicial statements in regard to the Settlement will
10 comport with Rule 5-120 of the California Rules of Professional Conduct.
11 Proposed 23(b)(3) Settlement Class Counsel may communicate with Claimants,
12 23(b)(3) or 23(b)(2) Settlement Class Members, clients, or potential clients.
13 XI. MISCELLANEOUS PROVISIONS
14 11.1 Admissibility of Settlement Agreement
15 This Settlement Agreement shall not be offered or be admissible in evidence
16 in any action or proceeding except (1) the hearings necessary to obtain and
17 implement Court approval of this Settlement; or (2) any hearing to enforce the
18 terms of this Settlement Agreement or any related order by the Court.
19 11.2 Successors and Assigns
20 The terms of this Settlement Agreement shall apply to and bind the Parties as
21 well as their heirs, successors and assigns.
22 11.3 Communications Relating to Settlement Agreement
23 All notices or other formal communications under this Settlement Agreement
24 shall be in writing and sent by mail to counsel for the party to whom the notice is
25 directed at the following addresses:
26
27
28
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1 Equifax:
2 Craig E. Bertschi, Esq.
Cindy Hanson, Esq.
3 KILPATRICK STOCKTON LLP
1100 Peachtree Street, Suite 2800
4 Atlanta, GA 30309-4530
5 Experian:
Daniel J. McLoon, Esq.
6 Michael G. Morgan, Esq.
JONES DAY
7 555 South Flower Street
Fiftieth Floor
8 Los Angeles, CA 90071-2300
9 TransUnion:
10 Julia B. Strickland, Esq.
Stephen J. Newman, Esq.
11 STROOCK & STROOCK & LAVAN LLP
2029 Century Park East, Suite 1800
12 Los Angeles, CA 90067
13 Plaintiffs:
Michael W. Sobol, Esq.
14 LIEFF CABRASER HEIMANN & BERNSTEIN, LLP
275 Battery Street, 30th Fl.
15 San Francisco, California 94111
16 Michael Caddell, Esq.
CADDELL & CHAPMAN
17 1331 Lamar, Suite 1070
Houston, TX 77010
18
Lee A. Sherman, Esq.
19 CALLAHAN, MCCUNNE & WILLIS, APLC
111 Fashion Lane
20 Tustin, California 92780-3397
21
Any Party may, by written notice to all the other Parties, change its designated
22
recipient(s) or notice address provided above.
23
11.4 Defendants’ Communications with Consumers in the Ordinary Course
24
of Business
25
Defendants reserve the right to continue communicating with their customers
26
and Consumers, including 23(b)(3) Settlement Class Members, in the ordinary
27
course of business. To the extent Consumers initiate communications regarding
28
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1 this Settlement Agreement, Defendants may confirm the fact of a settlement and
2 refer inquiries to the Settlement Administrator. Nothing herein is intended to
3 prohibit Defendants from communicating with Consumers regarding disputes
4 relating to tradelines and the reporting of Chapter 7 bankruptcies.
5 11.5 Efforts to Support Settlement
6 The Parties and their counsel agree to cooperate fully in seeking Court
7 approval for this Settlement Agreement and to use their best efforts to effect the
8 consummation of the Settlement and to protect the Settlement Agreement by
9 applying for appropriate orders enjoining others from initiating or prosecuting any
10 action arising out of or related to facts or claims alleged in the Litigation, if so
11 required.
12 11.6 Procedures for Disputes Between Parties Relating to the Settlement
13 Agreement
14 To the extent any disputes or issues arise with respect to documenting or
15 effecting the Settlement Agreement, the Parties agree to use their best efforts to
16 informally resolve any such disputes or issues; but in the event any such dispute or
17 issue cannot be resolved informally, to bring any such dispute or issue to the Court
18 for resolution.
19 11.7 Entire and Voluntary Agreement
20 The Parties intend the Settlement Agreement to be a final and complete
21 resolution of all disputes between them, except for those disputes relating to the
22 Injunctive Relief Fee Agreement and except as further specifically provided for
23 herein. The Parties agree that the terms of the Settlement Agreement were
24 negotiated at arm’s length and in good faith and were reached voluntarily after
25 consultation with competent legal counsel. This Settlement Agreement contains the
26 entire agreement and understanding concerning the subject matter between the
27 Parties, excluding those subjects that relate to the Injunctive Relief Fee Agreement,
28 and supersedes all prior negotiations and proposals, whether written or oral. No
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1 other party or any agent or attorney of any other party has made any promise,
2 representation or warranty whatsoever not contained in this Settlement Agreement
3 and the other documents referred to in this Settlement Agreement to induce them to
4 execute the same. The Parties represent that they have not executed this instrument
5 or the other documents in reliance on any promise, representation or warranty not
6 contained in this Settlement Agreement and the other documents referred to in this
7 Settlement Agreement.
8 11.8 Headings for Convenience Only
9 The headings in this Settlement Agreement are for the convenience of the
10 reader only and shall not affect the meaning or interpretation of this Settlement
11 Agreement.
12 11.9 Settlement Agreement Controls
13 All of the exhibits attached hereto are hereby incorporated by reference as
14 though fully set forth. To the extent that there is any conflict between the terms of
15 this Settlement Agreement and the exhibits attached hereto, this Settlement
16 Agreement shall control.
17 11.10 Amendments
18 The Settlement Agreement may be amended or modified only by a written
19 instrument signed by Defendants and 23(b)(3) Settlement Class Counsel, or their
20 respective successors-in-interest.
21 11.11 Authorization of Counsel
22 a. Proposed 23(b)(3) Settlement Class Counsel, on behalf of the
23 23(b)(3) Settlement Class, are expressly authorized by Plaintiffs
24 to take all appropriate action required or permitted to be taken
25 by the 23(b)(3) Settlement Class pursuant to the Settlement
26 Agreement to effectuate its terms, and also are expressly
27 authorized to enter into any modifications or amendments to the
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Case 8:05-cv-01070-DOC-MLG Document 726 Filed 10/20/10 Page 1 of 2 Page ID
#:10724
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
Case No. SACV 05-1070 DOC (MLGx) Date: October 20, 2010
Title: TERRI N. WHITE et. al. v. EXPERIAN INFORMATION SOLUTIONS, INC. et.al.
PRESENT:
THE HONORABLE DAVID O. CARTER, JUDGE
On July 8, 2010, Settling Plaintiffs filed a Submission Complying with the Court’s Order
Conditionally Granting Request for Second Notice and Alternative Notice Proposal (“July 8
Submission”) (Docket 704). The contents of Settling Plaintiffs’ July 8 Submission caused the Court to
treat the July 8 Submission as a motion for reconsideration. Accordingly, the Court set a briefing
schedule on the matter, allowing White Plaintiffs to file an opposition and Settling Plaintiffs to file a
Reply. See Order Setting Briefing Schedule, Aug. 6, 2010 (Docket 713). In their moving, opposing
and replying papers, the parties put forth conflicting factual accounts regarding the data used to
generate the initial class notice list as well as the number, and description, of consumers who actually
received notice. In order to resolve this factual dispute, the Court hereby ORDERS the parties to
submit supplemental briefing on this issue.
In their Motion for Reconsideration, Settling Plaintiffs aver that the group of consumers
who received the original class notice was overinclusive, exceeding the number of legitimate class
members by “perhaps millions.” Settl. Pl.’s Subm at 8. In support of this claim, Settling Plaintiffs
assert that “notice was sent to any consumer with an archived credit file reflecting a questionable
tradeline, followed by a credit inquiry, even if the next archived ‘snapshot’ showed that the
questionable tradeline had been corrected or dropped.” Id. Settling Plaintiffs explain that “[i]n many of
those cases, of course, the tradeline in question may have been corrected or dropped prior to the credit
inquiry response.” Id. However, Settling Plaintiffs contend that, in the interests of caution, class notice
was sent to consumers who showed a corrected tradeline subsequent to the issuance of a credit report,
In their Opposition, White Plaintiffs contest Settling Plaintiffs’ factual account of the data
used to generate the class notice list. According to White Plaintiffs, “the problem with [Settling
Plaintiffs’ above-described] hypothetical is that it could never happen.” White Pl.’s Opp. at 10 n.2.
Rather, White Plaintiffs assert that “[u]nder the terms of the Settlement, the Class List is generated by
looking at an archive snapshot, which shows both a ‘questionable tradeline’ and a credit report having
been issued during the year preceding the snapshot.” Id. (emphasis in original). Relying on the factual
contention that class notice was sent only to people whose archived snapshots indicated a questionable
tradeline subsequent to the issuance of a credit report, White Plaintiffs argue that, in the case of every
person who received the initial class notice, the questionable tradeline could not possibly have been
corrected before their credit report was issued.
In Reply, Settling Plaintiffs appear to concede that notice was sent only to consumers
who showed “an errant tradeline at the end” of the archive period during which a credit report was
published. Settl. Pl’s Rep. at 7 (emphasis added). However, Settling Plaintiffs proffer a dynamic view
of credit tradelines in their Reply, arguing that tradelines can vacillate from non-questionable to
questionable during the span of one archive period. They submit that “a consumer who shows an errant
tradeline at the end of an archive period may have had a credit report published only at an earlier time
when the tradeline was not in questionable status.” Id.
As the above paragraphs demonstrate, the parties have presented the Court with
conflicting factual accounts, both concerning the nature of credit reporting and the number, and
description, of people who received the original class notice. Notably, however, none of the factual
assertions put forth in the parties’ submissions are supported by evidence. The present record,
therefore, does not allow the Court to resolve this factual dispute.
Accordingly, the Court ORDERS the parties to submit supplemental briefing on this
factual issue. The parties’ arguments shall be supported by affidavits signed under the penalty of
perjury, as well as any other evidence that the parties deem appropriate. The supplemental briefs shall
be limited to fifteen pages, not including exhibits. The parties shall submit this supplemental briefing
no later than November 4, 2010.
If, after reviewing the parties’ supplemental briefs, the Court determines that an
evidentiary hearing on this matter is necessary, the Court will schedule a hearing in a subsequent Order.
The Clerk shall serve this minute order on all parties to the action.
1
I. INTRODUCTION AND BACKGROUND
2
On December 14, 2010, the Court granted the Settling Plaintiffs’ Motion for
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Reconsideration with respect to the re-noticing of the entire notice list in the above-
4
captioned matter. (Dkt. No. 732.) The Court ruled that, in addition to those who
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previously submitted Actual Damage Award and Convenience Award claims,
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secondary notice should be sent only to individuals who previously opted out of, or
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objected to, the settlement. (Id. at 9.) On December 22, 2010, in compliance with
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the Court’s December 14, 2010 order, the Settling Plaintiffs filed their Submission
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Complying with the Court’s Order Granting Plaintiffs’ Motion for Reconsideration
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(Dkt. No. 733), which submitted proposed subsequent notices to Convenience
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Award claimants, Actual Damage Award claimants, and opt-outs and objectors.
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(Id. at Ex. D.)
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On January 5, 2011, Defendants filed a Joint Statement Regarding Settling
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Plaintiffs’ Submission Complying with the Court’s Order Dated December 14,
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2010. (Dkt. No. 734.) On January 10, 2011, the White Plaintiffs filed Objections to
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Settling Plaintiffs’ Proposed Supplemental Notice Forms Submitted in Response to
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the Court’s Order Dated December 14, 2010. (Dkt. No. 737.)
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Settling Plaintiffs revised the proposed supplemental notices to include both
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the Defendants’ proposed language as well as the White Plaintiffs’ suggestions, and
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filed their Notice of Revised Supplemental Notices on January 19, 2011. (Dkt. No.
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739.)
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II. APPROVAL OF SUPPLEMENTAL NOTICE
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Having reviewed Plaintiffs’ Submission Complying with the Court’s Order
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Granting Plaintiffs’ Motion for Reconsideration, Defendants’ Joint Statement
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Regarding the Settling Plaintiffs’ Submission, the White Plaintiffs’ Objections to
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Settling Plaintiffs’ Submission, and the Plaintiffs’ revised supplemental notices, the
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Court now FINDS, CONCLUDES, and ORDERS as follows:
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[PROPOSED] ORDER APPROVING PLTFS’
899871.2 -1- REVISED SUPPLEMENTAL NOTICES
CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 742 Filed 02/04/11 Page 3 of 3 Page ID
#:11814
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The Court approves the form of the revised Supplemental Notices to
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Convenience Award Claimants, Actual Damage Award Claimants, and opt-outs and
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objectors that Plaintiffs submitted on January 19, 2011. (See Dkt. No. 739.)
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On or before February 15, 2011, the Settlement Administrator shall cause the
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Supplemental Notices to be mailed to the Convenience Award Claimants, Actual
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Damage Award Claimants, opt-outs and objectors.
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The Cost of sending the secondary notice shall be deducted from whatever
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fees the Court awards to Settling Plaintiffs’ Counsel.
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IT IS SO ORDERED,
10
11 February 04, 2011 ______________________________
HON. DAVID O. CARTER
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[PROPOSED] ORDER APPROVING PLTFS’
899871.2 -2- REVISED SUPPLEMENTAL NOTICES
CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 732 Filed 12/14/10 Page 1 of 9 Page ID
#:11698
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
Case No. SACV 05-1070 DOC (MLGx) Date: December 14, 2010
Title: TERRI N. WHITE et. al. v. EXPERIAN INFORMATION SOLUTIONS INC., and related cases
PRESENT:
THE HONORABLE DAVID O. CARTER, JUDGE
Before the Court is Settling Plaintiffs’ Motion for Reconsideration of the Court’s Order
Conditionally Granting Request for Secondary Notice in the above-captioned case (“Motion”) (Docket
704 by 713). In addition to Settling Plaintiffs’ Motion, the Court also received an Opposition filed by
the White Plaintiffs (Docket 715), a Reply filed by Settling Plaintiffs (Docket 720), and a Joint
Response filed by Defendants (Docket 721). In order to settle a factual dispute that arose from the
above-listed submissions, the Court requested and received supplemental briefs from all parties. After
considering each of these submissions, and for the reasons set forth below, the Court hereby GRANTS
Settling Plaintiffs’ Motion for Reconsideration.
I. BACKGROUND
On April 24, 2009, the parties presented to the Court a motion for preliminary approval of
a settlement of monetary relief. On May 7, 2009, the Court granted that motion for preliminary
approval and conditionally certified the class. The first hearing regarding final approval for the
settlement was held January 11, 2010. At that time, the Settling Parties indicated that the
administration of the class was ongoing and they were not yet able to provide the Court with any
concrete estimates regarding the awards for the “convenience” and “actual damages” categories based
on responses to the class notice. As the Court required these numbers for its final fairness
determination, the Court continued the hearing on the motion for final approval and requested a status
The Supplemental Report stated, inter alia, that 744,809 timely and signed claim forms
for both actual and convenience awards were received, and, after a first-level analysis, that 345,268
actual damage award claims were remaining as of May 7, 2010. Pursuant to the monetary settlement,
there are three categories of actual damage awards: employment claims, mortgage/housing claims; and
other credit claims. The Settlement Administrator exercised its discretion pursuant to the settlement
agreement to conduct an audit of 1,000 of the actual damage award claimants’ files. The Supplemental
Report stated that, while the audit was still in progress, of the employment claims evaluated in the
audit, 34% had already been invalidated; of the mortgage/housing claims, 24% had been invalidated;
and of the other credit claims, 22% had been invalidated.
Settling Plaintiffs argued that given these audit results, there were likely to be many
invalid claims in the remaining 345,268 actual damage claims, and that paying out these invalid claims
would "result in potentially millions of dollars being paid out for invalid . . . claims," which would "not
[be] tenable for the Class," largely because it would substantially diminish the payout to those with
valid claims. Supp. Report at 7. As a remedy for this high percentage of purportedly invalid claims,
Settling Plaintiffs proposed a secondary validation process requiring claimants to provide additional
information. Supp. Report at 8. Whereas the first notice required only that the class member certify to
a belief that he had been damaged through a denial of employment, mortgage loan, or credit, the
proposed second notice would require the class member to list the date of the denial, the prospective
employer/lender/or creditor, and to provide corroborating documentation.
The Court agreed with Settling Plaintiffs’ proposal and ordered that secondary notice be
sent to all actual damage award claimants informing them of the new documentation requirement.
Order Conditionally Granting Request for Secondary Notice, June 30, 2010 (“Secondary Notice
Order”) (Docket 703). The Court further mandated that secondary notice be sent to convenience award
claimants, finding that the possibility of actual damage claimants being shifted to the convenience class
“changes the evaluation by the convenience award claimants in addition to the actual damages
claimants about whether they want to assert a claim or opt out of the process.” Secondary Notice Order
at 3. The Court then examined the content of the initial notice disseminated to all people appearing on
the notice list. The Court focused on the attestation requirement contained in the notice, which asked
notice recipients to determine if they qualified as a class member before submitting a claim by attesting
to their “belie[f] that there have been one or more errors in [their] credit reports regarding debt
discharged in bankruptcy.”
In the Secondary Notice Order, the Court ultimately ordered that the attestation
requirement be removed from the class notice on the grounds that it was burdensome and misleading.
The Court mandated that a revised notice of settlement, free of this provision, be sent to the entire
In response, Settling Plaintiffs filed the instant Motion for Reconsideration (Docket 704),
accepting the Court’s decision to re-notice both convenience claimants and actual damage claimants but
contesting the Court’s decision to re-notice the entire initial notice list.1 Settling Plaintiffs agreed to
bear the costs of secondary notice to convenience and actual damage claimants, but not the costs of
renoticing the entire initial list – a cost that Settling Plaintiffs estimated at approximately $5 million.
Federal Rule of Civil Procedure 60(b) “provides for reconsideration only upon a showing
of (1) mistake, surprise, or excusable neglect; (2) newly discovered evidence; (3) fraud; (4) a void
judgment; (5) a satisfied or discharged judgment; or (6) ‘extraordinary circumstances’ which would
justify relief.” School Dist. No. 1J, Multnomah County v. Acands, Inc., 5 F.3d 1255, 1263 (9th Cir.
1993) (quoting Fuller v. M.G. Jewelry, 950 F.2d 1437, 1442 (9th Cir. 1991)). These grounds are
further limited by the Local Rules. Local Rule 7-18 provides that a motion for reconsideration of a
decision on any motion may be made only on the following grounds: “(a) a material difference in fact
or law from that presented to the Court before such decision that in the exercise of reasonable diligence
could not have been known to the party moving for reconsideration at the time of such decision, or (b)
the emergence of new material facts or a change of law occurring after the time of such decision, or (c)
a manifest showing of a failure to consider material facts presented to the Court before such decision.”
L.R. 7-18.
A district court, however, has inherent discretionary power to revisit previously issued
orders and to reopen any part of a case still pending before the court. See Marconi Wireless Tel. Co. v.
United States, 320 U.S. 1, 47-48 (1943); Natural Resources Defense Council v. Evans, 243 F. Supp. 2d
1046, 1048 (N.D. Cal. 2003); Kapco Mfg. Co. v. C & O Enterprises, Inc., 773 F.2d 151, 154 (7th Cir.
1985).
III. DISCUSSION
The Court finds that when Settling Plaintiffs submitted their Motion for Reconsideration,
they believed in good faith that the Court had manifestly failed to consider material facts and/or had
relied on erroneous facts, as required for the filing of a motion for reconsideration under the Local
Rules. Settl. Pl.’s Mot. at 4 (“The Court’s concern ... appears rooted in an oft-repeated false
1
Settling Plaintiffs titled their submission a “Response” to the Court’s Secondary
Notice Order. The Court, however, construed this submission as a Motion for
Reconsideration and set a briefing schedule on the matter. Order Setting Briefing
Schedule, Aug. 6, 2010 (Docket 713).
After review, the Court finds that its decision in the Secondary Notice Order arose from a
misunderstanding of the relevant facts. The Court exercises its discretionary power to modify the
Secondary Notice Order.
For a variety of reasons, the Court reconsiders its position on the propriety of re-noticing
the entire initial notice list. As explained in more detail below, secondary notice to the entire list would
prove both unnecessary and unwise. The Court thus GRANTS Settling Plaintiffs’ Motion for
Reconsideration with respect to this portion of the Secondary Notice Order.
1. Attestation Requirement
The Court’s decision to re-notice the entire notice list arose from concerns over the
attestation requirement included in the current class notice. Specifically, at the time of issuing the
Secondary Notice Order, the Court was persuaded by the White Plaintiffs’ argument that instructing
notice recipients to “first determine if [they were] a class member,” Notice of Final Forms of Notice of
Class Action Settlement, Ex. C at 4, Aug. 18, 2009 (Docket 458), before submitting a claim amounted
to an affirmative misrepresentation of the notice recipient’s class status. The Court reached this
conclusion in reliance on the White Plaintiffs’ factual contention that the notice list had been screened
to include only people who presumptively met the definition of a settlement class member. If this were
the case, instructing notice recipients to first “determine” whether they qualified as presumptive class
members before filing a claim constituted an affirmative misrepresentation, as it implied that notice was
received by people who did not presumptively qualify for relief.
The Court worried about the chilling effect that this seeming misrepresentation might
have had on class members’ responses. Although the attestation requirement is minimal – it merely
asks notice recipients to declare a “belief” that they qualify as a class members – the Court was
unwilling to allow affirmative misstatements to influence class members’ decisions, even in a de
minimis manner.
The Court’s position changed when it received Settling Plaintiffs’ Motion for
Reconsideration. There, Settling Plaintiffs challenged the Court’s view of the facts. In so doing,
Settling Plaintiffs necessarily challenged the conclusions reached in reliance on those “facts.” Contrary
to the White Plaintiffs’ assertions, Settling Plaintiffs urged that many people other than qualifying class
members received the initial settlement notice and that the attestation requirement was thus necessary to
ensure that non-qualified individuals did not drain the recovery pool for rightful class members. The
supplemental briefing and accompanying affidavits submitted by Settling Plaintiffs and Defendants –
The 23(b)(3) Settlement Class in this case includes “all Consumers who have received an
order of discharge pursuant to Chapter 7 of the United States Bankruptcy Code and who, at any time
between and including March 15, 2002, and May 11, 2009 (or, for California residents in the case of
TransUnion, any time between and including May 12, 2001 and May 11, 2009) have been the subject of
a Post-bankruptcy Credit Report issued by a Defendant that contained possible errors regarding debts
discharged in bankruptcy.” Order, inter alia, Granting Preliminary Approval To Proposed Class Action
Settlement at 5, May 7, 2009 (“Preliminary Approval Order”) (Docket 423). According to Defendants’
affidavits, the nature of Defendants’ record-keeping made it impossible to generate a list limited to
people who met the above criteria without also excluding people who met the criteria. In other words,
any list generated by Defendants would be either overinclusive or underinclusive. In order to ensure
that all qualified class members received notice of the action, Defendants and Settling Plaintiffs
rightfully erred on the side of overinclusiveness.
For example, the screening criteria did not filter out consumers whose qualifying
tradelines or collections were added to their credit file only after the credit report was issued (meaning
that the credit report itself did not contain an error). People whose file met this description would have
received the notice of settlement – but they would not qualify as a class member.
In addition, Defendants and Settling Plaintiffs point to the practice of “riding through”
revolving debt to indicate the overinclusiveness of the notice list. A consumer “rides through” a
revolving debt account when, for instance, a consumer continues to use a credit card for purchases
subsequent to the bankruptcy filing. Morgan Decl., Exh. 16. Any debt that the consumer incurs post-
bankruptcy would not be subject to a bankruptcy discharge. Id. A showing of delinquency on this
post-bankruptcy debt would not qualify a consumer for membership in this class action – but it would
qualify the consumer for a position on the notice list, given the limitations of Defendants’ records.
Defendants offer additional examples of such situations, but the Court need not belabor
the point. The above-listed examples suffice to change the Court’s position on the need for secondary
notice to every initial notice recipient. In light of Defendants’ limited records, it is entirely likely that
the parties disseminated notice to an overinclusive group of individuals. At the very least, there is no
way to ensure that this did not occur. In instructing class members to “first determine if [they were] a
class member,” before submitting a claim, the initial class notice contained no affirmative misstatement.
Rather, the attestation requirement served the vital and legitimate goal of screening out individuals who
did not qualify for settlement relief.
White Plaintiffs argue that, even if the attestation requirement was not affirmatively
misleading, the chilling effect that this requirement may have exerted on legitimate claimants cannot be
justified, given that the large majority of notice recipients were rightful class members. The Court,
however, must balance the possible disincentivizing effect of the attestation requirement against the
provision’s benefits. See Churchill Village, L.L.C. v. General Electric, 361 F. 3d 556, 575 (9th Cir.
2004) (“Fed. R. Civ. P. 23(c)(2) prescribes the “best notice practicable under the circumstances.”)
(emphasis added). Given that each class member’s recovery depends on the number of other class
members who submit a claim, some stringency in the claims process is only fair. On the other hand,
unnecessary burdens discourage legitimate class members from participating in the settlement. The
attestation requirement – which requires only a stated “belief” that a class members fits the class
definition and no documentary evidence – strikes a balance between these competing concerns. The
original notice, with the attestation requirement included, constituted the fairest possible notice under
the circumstances. Redrafting the notice to eliminate the attestation provision would prove both
unnecessary and unwise.
2. Reevaluation Rationale
The White Plaintiffs contend that the attestation requirement was not the only factor
motivating the Court’s decision in the Secondary Notice Order. Rather, the White Plaintiffs submit that
the Court also ordered wholesale re-noticing in order to give the notice recipients who previously did
not respond to the settlement a chance to reevaluate their decision in light of the newly imposed
documentation requirement to become a damages class member. The Court clarifies that it did not base
its decision to re-notice the entire notice list on this theory. Nor does the Court finds this theory
persuasive now.
As presented by the White Plaintiffs, the “reevaluation rationale” is based on two distinct
The alternative basis of the White Plaintiffs’ theory speculates that notice recipients who
previously did nothing in response to the notice of settlement might, for self-interested reasons,
reconsider their decision to file a claim in light of the documentation requirement for actual damage
claims. Specifically, the White Plaintiffs surmise that potential actual damage claimants with
documents to support their claims might have remarked on the lack of documentation requirement in
the initial notice and decided not to file a claim, assuming that any payout would be minimal because of
the ease of claiming actual damages. White Plaintiffs contend that this same person – who previously
took no action in order to secure compensation or to preserve his or her right to bring a separate suit –
might now decide to file an claim on the assumption that the documentation requirement will make the
pro rata recovery of each actual damages claimant higher.
The Court finds this scenario as far-fetched as the last. White Plaintiffs’ hypothetical
asks the Court to believe that class members with the most supported, and thus arguably the strongest,
claims for actual damages previously would have elected to receive nothing under the settlement (and
to relinquish their right to sue at a later time) but would now prove motivated to file a claim solely
because of the documentation requirement. The Court cannot imagine that many notice recipients
would behave in accordance with the White Plaintiffs’ theory – certainly not enough to justify a $5
million re-noticing effort.
Finally, the White Plaintiffs remind the Court of its stated concerns regarding the fact that
only five percent of absent class members responded to the notice of settlement. The Court continues
to believe that a five percent response rate to a notice disseminated by direct mail is low. See Zimmer
Paper Products, Inc. v. Berger & Montague, P.C., 758 F.2d 86, 93 (3d Cir. 1985) (finding that even
though a response rate of 12% “appears low ... [i]t is in line with response rates in similar situations”)
(citing Newberg on Class Actions § 2695, Feb. 1984). A low response rate alone, however, does not
necessarily require re-noticing. Cf. Williams v. MGM-Pathe Communications Co., 129 F.3d 1026, 1027
(9th Cir. 1997) (accepting a settlement where only $3,300 was claimed out of a $4.5 million class fund
and holding that attorneys fees should have been calculated as a percentage of the $4.5 million fund).
Nor is there any guarantee that resending notice would generate a significantly higher response rate,
In any event, the Court must balance the possible benefits of secondary notice against the
costs. Here, secondary notice would cost approximately $5 million, removing $5 million from the
settlement fund and decreasing the compensation of each participating class member. Although White
Plaintiffs contend that the cost of resending notice could be borne by Settling Plaintiffs counsel or
Defendants, neither Settling Plaintiffs nor Defendants have offered to bear this cost. The Court finds it
unfair to impose this cost on them. As set forth above, aside from the later-discovered need to require
documentation for participation in the actual damages class, the Court finds that the original notice was
proper. The $5 million cost of secondary notice would impact the class. The costs of this notice
outweigh the benefits. See Churchill Village, 361 F.3d at 575 (upholding the district court’s decision
not to renotice the class, citing Fed. R. Civ. P. 23(c)(2)’s mandate of the “best notice practicable under
the circumstances.”)
Accordingly, the Court hereby GRANTS Settling Plaintiffs’ Motion for Reconsideration
with respect to the re-noticing of the entire notice list. Secondary notice need not be sent to the entire
initial notice list.
The “reevaluation rationale” that the Court rejected as applied to notice recipients who
previously ignored the notice of settlement applies with much greater force to individuals who
previously objected to, or opted out of, the settlement. Far from exhibiting apathy to the proposed
settlement, opt-outs and objectors evinced strong reactions to it. Fairness dictates that these individuals
be provided an opportunity to reevaluate their position in light of the changes to the settlement –
namely, the newly-added documentation requirement for actual damages claims.
The Court therefore finds that secondary notice should be sent to any notice recipients
who previously objected to, or opted out of, the settlement. Given that the rationale for re-noticing both
convenience claimants and actual damage claimants applies with equal force to the re-noticing of opt-
outs and objectors, it stands to reason that Settling Plaintiffs’ willingness to bear the costs of re-noticing
convenience claimants and actual damage claimants extends to the costs of re-noticing opt-outs and
objectors.
The Court ORDERS that Settling Plaintiffs’ file a submission confirming or denying their
willingness to bear these costs by noon on December 22, 2010. In this submission, Settling Plaintiffs
shall also provide the Court with the estimated costs of such re-noticing. Finally, this submission must
include a proposed draft of the secondary notice to opt-outs and objectors.
For the reasons stated above, the Court GRANTS Settling Plaintiffs’ Motion for
Reconsideration with respect to the re-noticing of the entire notice list. Secondary notice need not be
sent to the entire initial notice list. However, secondary notice should be sent to individuals who
previously opted out of, or objected to, the settlement.
The Court ORDERS Settling Plaintiffs to file a submission confirming or denying their
willingness to bear the costs of re-noticing opt outs and objectors by noon on December 22, 2010. In
this submission, Settling Plaintiffs shall also provide the Court with the estimated costs of such re-
noticing. Finally, this submission must include a proposed draft of the secondary notice to opt-outs and
objectors.
Other parties, including the White Plaintiffs, shall have until 5pm on Monday January 10,
2011 to object to the content of the proposed secondary notice to opt outs and objectors. Submissions
objecting to the content of the proposed secondary notice to opt outs and objectors shall not exceed ten
pages.
The Clerk shall serve this minute order on all parties to the action.
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8 UNITED STATES DISTRICT COURT
9 FOR THE CENTRAL DISTRICT OF CALIFORNIA
10
11 TERRI N. WHITE, et al. ) CASE NO. SACV 05-1070 DOC (MLGx)
) (Lead Case)
12 Plaintiffs, )
)
13 v. ) O R D E R CONDITIONALLY
) GRANTING REQUEST FOR
14 EXPERIAN SOLUTIONS, INC., ) SECONDARY NOTICE
)
15 Defendant. )
)
16 )
)
17 )
)
18 )
)
19 _________________________________ )
20 Before the Court is the request made by Settling Plaintiffs and the 23(b)(3) Settlement
21 Class in the Supplemental Report on Settlement Administration (“Supp. Report”) that a
22 secondary notice be sent to the Class. Dkt. 667.
23 On April 24, 2009, the parties presented to the Court a motion for preliminary approval of
24 a settlement of monetary relief. On May 7, 2009, the Court granted that motion for preliminary
25 approval and conditionally certified the class. On May 21, 2009, the White Plaintiffs moved for
26 reconsideration of the Court’s grant on the basis that Settling Plaintiffs’ counsel had engaged in
27 misconduct, but the Court denied that motion. The first hearing regarding final approval for the
28 settlement was held January 11, 2010. At that time, the Settling Parties indicated that the
Case 8:05-cv-01070-DOC -MLG Document 703 Filed 06/30/10 Page 2 of 5
1 administration of the class was ongoing and they were not yet able to provide the Court with any
2 concrete estimates regarding the awards for the “convenience” and “actual damages” categories
3 based on responses to the class notice. As the Court required these numbers for its final fairness
4 determination, the Court continued the hearing on the motion for final approval and requested a
5 status report from the Settling Parties prior to the next hearing. The Settling Plaintiffs filed an
6 Interim Report and the Supplemental Report on Settlement Administration. The Court then held
7 a second hearing on the final fairness determination on May 20, 2010.
8 The Supplemental Report stated, inter alia, that 744,809 timely and signed claim forms
9 for both actual and convenience awards were received, and, after a first-level analysis, that
10 345,268 actual damage award claims were remaining as of May 7, 2010. Pursuant to the
11 monetary settlement, there are three categories of actual damage awards: employment claims,
12 mortgage/housing claims; and other credit claims. The Settlement Administrator exercised its
13 discretion pursuant to the settlement agreement to conduct an audit of 1,000 of the actual
14 damage award claimants’ files. The Supplemental Report stated that, while the audit was still in
15 progress, of the employment claims evaluated in the audit, 34% had already been invalidated; of
16 the mortgage/housing claims, 24% had been invalidated; and of the other credit claims, 22% had
17 been invalidated.
18 Settling Plaintiffs argue that given these audit results, there are likely to be many invalid
19 claims in the remaining 345,268 actual damage claims, and that paying out these invalid claims
20 would "result in potentially millions of dollars being paid out for invalid . . . claims," which
21 would "not [be] tenable for the Class," largely because it would substantially diminish the payout
22 to those with valid claims. Supp. Report at 7. As a remedy for this high percentage of
23 purportedly invalid claims, Settling Plaintiffs propose a secondary validation process in which
24 claimants are required to provide additional information. Supp. Report at 8. Whereas the first
25 notice required only that the class member certify to a belief he had been damaged through a
26 denial of employment, mortgage loan, or credit, the proposed second notice would require the
27 class member to list the date of the denial, the prospective employer/lender/or creditor, and
28 provide corroborating documentation.
2
Case 8:05-cv-01070-DOC -MLG Document 703 Filed 06/30/10 Page 3 of 5
1 Sending a secondary notice form is within the power of the court. See Zimmer Paper
2 Products, Inc. v. Berger & Montague, P.C., 758 F.2d 86, 93 (3d Cir.1985) (explaining that
3 “[b]efore approving any distribution of settlement proceeds to class members,” if the district
4 court finds cause for concern in the provision of notice, the court may “order[ ] further notice
5 procedures”). Settling Plaintiffs provided a proposed secondary notice to the Court at the May
6 hearing on the final settlement approval. The Court approves sending out a secondary notice for
7 the purpose of requiring additional information from the actual damage claimants. Such a notice
8 will effectuate the ultimate purpose of providing different awards to persons who suffered
9 different types of damage from errors in their credit report.
10 Additionally, the Court agrees with the White Plaintiffs that this secondary notice should
11 be sent out to the entire class, not solely the actual damage award claimants. By requiring
12 additional information to be provided by actual damage award claimants for verification of their
13 claims, there will naturally be a number of actual damage award claimants who are unable to
14 provide this information or provide information that does not correspond to a query, and as a
15 result, they will be shifted to the convenience damage award claimant category. As such, it
16 changes the evaluation by the convenience award claimants in addition to the actual damage
17 award claimants about whether they want to assert a claim or opt out of the process.
18 The Court separately considers the somewhat low response rate to the notice, an issue
19 raised at the final fairness hearing. There were 744,809 timely claim forms1 out of a class of 15
20 million, which is a five percent response rate. Roughly 14.25 million class members did not
21 respond. A low response rate may, in some situations, be indicative of a defect in the class
22 notice. See In re TJX Companies Retail Sec. Breach Litigation, 584 F.Supp.2d 395, 404-5 (D.
23 Mass. 2008). Therefore, while the Court originally approved the form of the Notice sent out to
24 the class, since it has already determined that the secondary notice needs to be sent to the entire
25 class, the Court reexamines the Notice at this time.
26
27
1
28 This number does not account for opt-outs and objectors.
3
Case 8:05-cv-01070-DOC -MLG Document 703 Filed 06/30/10 Page 4 of 5
1 The White Plaintiffs have strongly objected to the class notice's requirement that class
2 members were required to sign a response form attesting, "I believe that there have been one or
3 more errors in my credit reports regarding debt discharged in bankruptcy." They object on the
4 basis that the notices were already sent to everyone who had errors in their credit report, and
5 therefore there was no justification for requiring class members to attest to their personal belief
6 as to this fact. Furthermore, they contend that many debtors would not know that there was an
7 error and that it would be very difficult for them to now investigate and confirm whether there
8 was an error.
9 Settling Plaintiffs argue that this phrasing is appropriate because it is possible that
10 someone could fall within the class definition but still be excluded from the class because, for
11 example, they previously released all of their claims against the defendant. S. Pl.’s Responses to
12 Obj. to Final Approval, at 19. However, the Court finds that the original attestation did not
13 accomplish the limited objectives now purported by Settling Plaintiffs–to ensure that none of the
14 class exclusions applied to the claimant–and a rephrasing of the attestation for convenience
15 award claimants should be used in the revised notice. Instead of the previously-required
16 attestation, convenience award claimants should only be required to attest that they believe that
17 none of the listed exclusions are applicable.
18 At oral argument, it became clear that the need for a secondary notice was at least
19 partially due to the parties’ underestimation of the number of actual damage award claims that
20 would be received. Perhaps as an acknowledgment of that fact, Settling Plaintiffs agreed to pay
21 for the cost of the re-notice to all actual damage claimants out of any attorneys’ fees award. In
22 other words, the administrative fees of the notice would not diminish the claimant award fund.
23 While the possibility of sending the secondary notice to the entire class was discussed, the costs
24 and payment of those costs were not settled at the hearing.
25 As such, Plaintiff SHALL submit to the Court with seven (7) days:
26 1. A proposed revised secondary notice incorporating the Court’s ruling.
27 2. A statement regarding the estimated administrative cost of the secondary
28 notice directed by the Court and the effect that cost would have upon the
4
Case 8:05-cv-01070-DOC -MLG Document 703 Filed 06/30/10 Page 5 of 5
1 settlement fund, including what segment of the fund would bear the
2 administrative cost.
3 The White Plaintiffs, or any other objectors, may file an objection to the submitted revised
4 secondary notice that extends solely to the wording of the notice, not its scope, as the Court has
5 ruled upon that issue here. Any objection must be filed within seven (7) days of the filing of the
6 revised notice by Settling Plaintiffs.
7 Should the Court be satisfied with the additional submissions provided by Settling
8 Plaintiffs, the Court shall provide further direction regarding secondary notice at that time.
9 IT IS SO ORDERED.
10 DATED: June 30, 2010
11
12 _______________________________
DAVID O. CARTER
13 United States District Judge
14
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Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 1 of 11
1 Award claims were invalidated (30.34% of the total) before any individual claims
2 files were reviewed. The remaining 345,268 Actual Damage Award claims were
3 therefore treated by the Settlement Administrator as “initially valid,” pending
4 review of the individual credit files.
5 B. Audit Of 1,000 Actual Damage Award Claims
6 In light of the high percentage of invalid actual damage award claims
7 resulting from the initial review, the Settlement Administrator has exercised its
8 discretion, pursuant to the Settlement Agreement and Release (“Agreement”), to
9 require Defendants to produce the archived credit files of 1,000 Actual Damage
10 Award claimants to confirm the validity of such claims. Agreement § 7.7(c)(ii).
11 To conduct the review, GCG randomly selected a statistical sampling of
12 1,000 Actual Damage Award Claims that appeared initially valid (for example,
13 excluding claims with a date after the effective date of the injunctive relief). GCG
14 provided a unique identification number for each of the 1,000 claims, and
15 information was provided by at least one Defendant for all 1,000 claims. By
16 necessity, because of the nature in which their respective data is recorded, each of
17 the Defendants provided GCG with data for the 1,000 claim audit in a different
18 format.
19 GCG reviewed and attempted to validate any and all of the categories
20 claimed by the claimant on the claim form rather than following the hierarchy of
21 categorical validation for a given claim as outlined in the Settlement Agreement
22 (whereby a claim will be paid for the highest award for which it is eligible).
23 1. Employment Claims
24 Four hundred twenty-two (422) of the 1,000 claims in the audit claimed a
25 denial of employment. For each of these, GCG searched each Defendant’s data
26 files to confirm the existence of an employment inquiry “flag” and then reviewed
27 the data as directed by each Defendant to determine whether the employment
28 claims were valid. For the employment claims for which one of the Defendants had
SUPPLEMENTAL REPORT –
877975.3 -2- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 4 of 11
1 the claimant on its respective list of employment inquiry flags, GCG thereafter
2 confirmed that the date of the employment inquiry occurred after the bankruptcy
3 discharge date. Where GCG confirmed an inquiry after the discharge date, those
4 claims were validated.
5 Essentially, for any claimant who had a post-bankruptcy employment flag –
6 no matter how many years after discharge and without respect to the date identified
7 by the claimant – their employment claim was validated. Despite this permissive
8 criteria, more than one-third of the employment claims were invalidated.
9 Nonetheless, for the remaining two-thirds of the employment claims, GCG is taking
10 a second look. One Defendant’s results for valid employment claims was
11 significantly higher than the other two Defendants. When GCG examined the
12 overlapping validated employment claims among the three Defendants, the number
13 of overlapping validations between each set of two Defendants was less than half
14 the total for the anomalous Defendant. Therefore, that Defendant is re-examining
15 the methods by which it reported employment inquiries. After this re-review, either
16 the number of invalid claims will increase even more as the anomalous Defendant’s
17 claims fall more in line with the other two Defendants or will remain the same if the
18 review of the Defendant’s data confirms its accuracy or does not provide any basis
19 to dispute it. Thus, at a minimum, over a third of the initially valid employment
20 claims in the audit have been invalidated, and that number could increase.
21 2. Mortgage/Housing Claims
22 For claims related to mortgage/housing and other credit, GCG reviewed the
23 archive data provided by the Defendants with the class lists and looked for
24 qualifying tradelines and a hard inquiry in the archive files going backward at least
25 one, if not two, years.1 GCG then examined the archived individual credit files
26 maintained by each Defendant to determine whether the inquiry in question from
1
27 Each Defendant provided one archive in each year, and the months of the archives
provided were staggered to include as much information as possible from all three
28 Defendants.
SUPPLEMENTAL REPORT –
877975.3 -3- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 5 of 11
1 their claim form fell within the relevant time period under the agreement, allowing
2 a seven-month window on either side to be inclusive of claims that may fall just
3 before or after the date of the archived credit file within the requisite months
4 (“within six (6) months of the date indicated by the Actual Damage Award
5 Claimant on the Claim Form,” Agreement § 7.7(c)(i)).
6 For example, if Claimant A was solely provided by Experian and Claimant A
7 claimed a Mortgage/Housing denial in January 2006, GCG was looking for a hard
8 inquiry sometime between July 2005 and July 2006 (six months on either side of
9 the claimed date). Because Experian provided reports as of June of each year, and
10 each of the Defendant’s reports provided inquiries for a two-year period, Experian’s
11 2006 report would include inquiries for June 2004 through June 2006. Therefore,
12 Experian’s reports for 2006, 2007, or 2008 could possibly contain a qualifying hard
13 inquiry for Claimant A. Furthermore, in order to review any of those files, a hard
14 inquiry flag was required to exist in either Experian's 2006, 2007, or 2008 initial
15 data. Finally, in order for Claimant A’s claim to be validated, there must exist a
16 hard inquiry on the credit report(s) with the appropriate Kind of Business
17 Classification (“KOB”) and/or type code within the seven‐month window claimed
18 by this Claimant (e.g., prior or subsequent to sometime between July 2005 and July
19 2006).
20 The coding for the mortgage or housing claims is much less definitive than
21 the Employment inquiries. GCG was advised by Counsel for the Defendants that a
22 complete list of relevant or validating Mortgage/Housing KOBs/codes does not
23 exist. Further, GCG was advised that there would be certain inquiries for which
24 Defendants would not be able to identify the inquiry as a certain Mortgage/Housing
25 inquiry versus some other type of credit inquiry. As a result, each Defendant
26 provided separate direction with respect to the identification of the KOBs/codes
27 which validate or possibly validate a given claim within their respective data.
28 There remain a small number of KOBs/codes which may validate
SUPPLEMENTAL REPORT –
877975.3 -4- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 6 of 11
1 Mortgage/Housing and/or Other Credit claims that two of the Defendants are
2 continuing to research.
3 Where a hard inquiry flag was present for the claimant within the requisite
4 timeframe, GCG reviewed the specific inquiry coding from each Defendant’s credit
5 file, looking for an industry code or KOB that would indicate a Mortgage or
6 Housing rental inquiry. If there was a “hit,” GCG confirmed that the inquiry and
7 the date claimed by the claimant fell within the time period required by the
8 Settlement. GCG looked at the inquiries in all three Defendants’ credit files to see
9 if they could validate the claim.
10 Though there are a few codes still being investigated by two Defendants, at
11 this time more than 25% of the total of eight hundred ninety-nine (899) “initially
12 valid” mortgage/housing claims are in fact invalid and another 17% are only
13 “possibly valid” because of indeterminate coding. There is also some doubt as to
14 the validity of even some of the apparently validated claims, because only 57% of
15 those were validated by all three Defendants, which is somewhat surprising given
16 the pervasive use of the tri-merge reports (i.e., credit reports from all three major
17 Credit Reporting Agencies) in connection with mortgage applications.
18 3. Other Credit Claims
19 GCG engaged in a similar review procedure for the Other Credit claims as
20 the Mortgage/Housing claims. GCG examined the claims to see if they matched
21 credit inquiry codes in the credit files of Defendants. Where a hard inquiry flag
22 was present for the claimant within the requisite timeframe, GCG reviewed the
23 specific inquiry coding from each Defendant’s credit file, looking for an industry
24 code or KOB that would indicate an Other Credit inquiry. If there was a “hit,”
25 GCG confirmed that the inquiry and the date claimed by the claimant fell within the
26 time period required by the Settlement. Only one Defendant’s validating inquiry
27 was required to validate an Other Credit claim.
28 Eight hundred sixty-six (866) of the 1,000 “initially valid” claims in the audit
SUPPLEMENTAL REPORT –
877975.3 -5- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 7 of 11
1 claimed Other Credit. Of those, more than 22% were invalid, and another 6% were
2 only “possibly valid” because of indeterminate coding.
3 C. Actual Damage Award Claimants And Next Steps
4 The 1,000 claim audit of “initially valid” claims demonstrates that there are a
5 significant number of damage award claimants who do not meet the criteria for any
6 of the three categories of actual damage awards. Settling Plaintiffs believe the only
7 viable option in proceeding with Settlement Administration and the validation of
8 the 495,699 actual damage claims is to request more information from the claimants
9 to validate their claims. In order to practically serve the best interests of the Class
10 and to avoid depleting the Settlement fund on the validation of claims, a second
11 round of Notice is needed to reach out to the actual damage claimants and obtain
12 more information from them. See, e.g., Manual for Complex Litigation (Fourth) §
13 21.66 (2004) (“it may be appropriate to require substantiation of the claims (e.g.,
14 through invoices, confirmations, or brokers records)”); Tarlecki v. Bebe Stores,
15 Inc., 2009 U.S. Dist. LEXIS 40774, at *12 (N.D. Cal. May 13, 2009)
16 (acknowledging that parties could undertake a further round of claim notices before
17 settlement proceeds); In re Shell Oil Refinery, 136 F.R.D. 588, 591 (E.D. La. 1991)
18 (court established two-step claims process that included first step of gathering
19 preliminary information about claimants’ identities and general nature of each
20 claim and second proof of claims process of gathering detailed information about
21 each claim).
22 Though there are still a few claims that are being re-reviewed and a few
23 codes are still being interpreted by two of the Defendants (which additional
24 information will be given to GCG), the audit has already demonstrated that a
25 substantial number of the actual damage claims are clearly or potentially invalid.
26 Even in the broadest, most easily validated category of Other Credit, more than
27 one-fifth of the “initially valid” claims are invalid. If GCG were to pay out all the
28 claims according to what is stated on the actual damage claim forms, they would be
SUPPLEMENTAL REPORT –
877975.3 -6- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 8 of 11
1 paying out millions of dollars in invalid claims at a huge cost to the Class. As an
2 example, of the 495,699 actual damage claimants, there were 57,040 “initially
3 valid” employment claims (with some claimants selecting employment and one or
4 more other categories). Projecting from the 1,000 claim audit that showed 34% of
5 those “initially valid” employment claims were actually invalid, that would mean
6 19,393 “initially valid” employment claims were invalid. The Settlement provides
7 for employment claims to be paid out at the highest level. Even if pro rated down,
8 payment of the initially invalid employment claims and the projected invalid
9 employment claims would result in potentially millions of dollars being paid out for
10 invalid employment claims. Such a result is not tenable for the Class.
11 Examining all of the actual damage claims on an individual basis following a
12 similar procedure as the audit is also not feasible. The audit of 1,000 claims has
13 taken place from December 2009 through early May 2010 and involved
14 approximately 1900 hours of work by GCG, at a cost of $140,526. The cost of
15 providing the data to GCG was borne by Defendants, who only committed to turn
16 over the files for the 1,000 claims in the audit. Even five months later, there are
17 still codes that are being determined by two of the Defendants at the request of
18 GCG. If GCG had to undertake the same detailed level of analysis of seven-year
19 time periods for all three Defendant for the almost half a million actual damage
20 claims, it would take years and would be cost-prohibitive.
21 After the almost-complete analysis by GCG, approximately 34% of the
22 employment claims are invalid, 25% of the mortgage/housing claims are invalid,
23 and 22% of the Other Credit category are invalid. The parties believe that the
24 continuing analysis will, if anything, increase the number of invalid claims.
25 Projecting these same percentages onto the 345,268 “initially valid” actual damage
26 claims for illustrative purposes only, a similar pattern of validations would result in
27 more than 19,000 invalid employment claims (out of a total of 57,040), more than
28 45,000 invalid mortgage/housing claims (and more than 30,000 claims only
SUPPLEMENTAL REPORT –
877975.3 -7- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 9 of 11
1 “possibly valid” out of a total of 181,389), and more than 69,000 invalid other
2 credit claims (and more than 18,000 only “possibly valid” claims out of a total of
3 310,546 other credit claims). If half of the “possibly valid” claims were validated,
4 it would result in over 61,000 invalid mortgage claims and over 78,000 invalid
5 other credit claims. Absent consideration of claim overlap, more than 158,000 total
6 “initially valid” claims would actually be invalid, an unacceptably high number.
7 When added to the number of claims invalidated as a result of the initial review
8 (150,431), there would be more than 308,431 invalid claims, or 62.2% of the total
9 Actual Damage Award claims. Thus, more than half of the actual damage claims
10 would be invalid.
11 Even if the effect of claim overlap evidenced by the 1,000 claim audit holds
12 true for the remaining “initially valid” claims, the audit reflects that 13.7% of the
13 “initially valid” Actual Damage Award claims are not valid in any category. Again,
14 assuming that one half of the “possibly valid” claims are in fact invalid (another
15 11.5%), and including the 150,431 claims that were invalidated as part of the initial
16 review process, this would still mean that 47.9% of the Actual Damage Award
17 claims would be invalid – still far too many.
18 Though the 1,000 claim audit is still ongoing, Settling Plaintiffs believe the
19 actual damage claims cannot be validated without further scrutiny. Moreover, it
20 would be cost-prohibitive for the Settlement Administrator to conduct a detailed
21 analysis of the almost half a million actual damage claims in a similar manner as
22 the audit. Therefore, Settling Plaintiffs believe it is necessary to allow claimants to
23 provide additional documentation to try to prove their claims. If they cannot or do
24 not submit such documentation, these claimants will have their claims converted to
25 a Convenience Award, pursuant to the Agreement § 7.7(c)(v), with a notification
26 accompanying their claim payment that informs them that their claim was
27 inconsistent with the data in their credit file.
28
SUPPLEMENTAL REPORT –
877975.3 -8- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 10 of 11
1
Dated: May 7, 2010 Respectfully submitted,
2
CADDELL & CHAPMAN
3
By: /s/ Michael A. Caddell
4 Michael A. Caddell
5 Michael A. Caddell (State Bar No. 249469)
(mac@caddellchapman.com)
6 Cynthia B. Chapman (State Bar No. 164471)
(cbc@caddellchapman.com)
7 George Y. Niño (State Bar No. 146623)
(gyn@caddellchapman.com)
8 1331 Lamar, Suite 1070
Houston, TX 77010
9 Telephone: (713) 751-0400
Facsimile: (713) 751-0906
10
Michael W. Sobol (State Bar No. 194857)
11 (msobol@lchb.com)
Allison S. Elgart (State Bar No. 241901)
12 (aelgart@lchb.com)
LIEFF, CABRASER, HEIMANN & BERNSTEIN,
13 LLP
275 Battery Street, 29th Floor
14 San Francisco, CA 94111-3339
Telephone: (415) 956-1000
15 Facsimile: (415) 956-1008
16 Stuart T. Rossman (BBO No. 430640)
(srossman@nclc.org)
17 Charles M. Delbaum (BBO No. 543225)
(cdelbaum@nclc.org)
18 NATIONAL CONSUMER LAW CENTER
7 Winthrop Square, 4th Floor
19 Boston, MA 02110
Telephone: (617) 542-8010
20 Facsimile: (617) 542-8028
21 Leonard A. Bennett (VSB No. 37523)
(lenbennett@cavtel.net)
22 Matthew Erausquin (VSB No. 65434)
(matt@clalegal.com)
23 CONSUMER LITIGATION ASSOCIATES, P.C.
12515 Warwick Boulevard, Suite 201
24 Newport News, Virginia 23606
Telephone: (757) 930 3660
25 Facsimile: (757) 930-3662
26
27
28
SUPPLEMENTAL REPORT –
877975.3 -9- CASE NO. 05-CV-1070 (MLGX)
Case 8:05-cv-01070-DOC-MLG Document 667 Filed 05/07/10 Page 11 of 11
1
BOIES, SCHILLER & FLEXNER LLP
2 David Boies (admitted pro hac vice)
333 Main Street
3 Armonk, NY 10504 NOTE: CHANGES MADE BY THE COURT
Telephone: 914.749.8200
4 Facsimile: 914.749.8300
Email: dboies@bsfllp.com
5
George F. Carpinello (admitted pro hac
6 vice)
Adam R. Shaw (admitted pro hac vice)
7 10 North Pearl Street
Albany, NY 12207
8 Telephone: 518.434.0600
Facsimile: 518.434.0665
9 Email: gcarpinello@bsfllp.com
ashaw@bsfllp.com
10
David L. Zifkin (SBN 232845)
11 3907 Ocean Front Walk
Marina Del Rey, California 90292
12 Telephone: 310.408.5462
Facsimile: 310.578-6020
13 Email: dzifkin@bsfllp.com
14
15 Attorneys for Plaintiffs Robert Radcliffe, Chester Carter, Maria Falcon, Clifton C.
Seale, III, Arnold E. Lovell, and all others similarly situated.
16
19
TERRI N. WHITE, et al., CASE NO. SA 05-CV-1070 DOC
20 (MLGx) (Lead Case)
Plaintiffs, Assigned to the Hon. David O. Carter
21
v. ORDER ON JOINT
22 STIPULATION ESTABLISHING
EXPERIAN INFORMATION
23 SOLUTIONS, INC., et al., NEW DATE FOR STATUS
CONFERENCE AND HEARING
24 Defendants.
REGARDING ETHICAL
25 and Related actions. ISSUES
26
27
28
Case 8:05-cv-01070-DOC-MLG Document 651 Filed 04/01/10 Page 2 of 2
1 Before the Court is the parties’ Joint Stipulation Establishing New Date For
2
Status Conference And Hearing Regarding Ethical Issues. For good cause showing,
3
this Court hereby orders and adjudges as follows:
4
5 A status conference and a hearing regarding the ethical issues shall be set for
6
Friday, May 14, 2010, at 4:30 p.m.
7
8
IT IS SO ORDERED.
10
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1
Case 8:05-cv-01070-DOC-MLG Document 650 Filed 03/26/10 Page 1 of 9
1 TABLE OF CONTENTS
2
Page
3
4 A. Settlement Claims Administration.............................................. 1
B. Audit of 1,000 Actual Damage Award Claims .......................... 2
5 C. Actual Damage Award Claimants and Next Steps..................... 5
6
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-i- INTERIM REPORT - CASE NO. 05-CV-1070 (MLGX)
861732.8
Case 8:05-cv-01070-DOC-MLG Document 650 Filed 03/26/10 Page 3 of 9
1 and a hard inquiry. The Settlement Administrator looked for qualifying tradelines
2 and a hard inquiry in the archive files going backward and forward at least one, if
3 not two, years.1 The Settlement Administrator is then examining the archived
4 individual credit files maintained by each Defendant to determine whether the
5 inquiry in question from their claim form fell within the relevant time period under
6 the agreement. The Settlement Administrator is looking at the seven months before
7 and after each claimed mortgage inquiry to be inclusive of all possible claims,
8 including ones that may fall just before or after the date of the archived credit file
9 within the requisite months.
10 The Settlement Administrator is currently in the process of reviewing the
11 claims of mortgage or housing denials or harm from the 1,000 actual damage
12 claims for the audit. The coding for the mortgage or housing claims is much more
13 complicated than the employment inquiries. The Settlement Administrator is first
14 looking at the Defendants’ files to see whether there is a qualifying tradeline and
15 hard inquiry for each claimant. The Administrator is then confirming coding from
16 the Defendants’ credit files that could indicate a mortgage or rental inquiry and will
17 match those codes with the individual credit files for the claimants. If there is a
18 “hit,” the Settlement Administrator will then check the date given on the claim form
19 to see if the inquiry falls within the time period required by the Settlement. The
20 Settlement Administrator is looking at the seven months before and after each
21 claimed mortgage inquiry to be inclusive of all possible claims, including ones that
22 may fall just before or after the date of the archived credit file within the month.
23 The Settlement Administrator will look at the inquiries in all three Defendants’
24 credit files to see if they can validate the claim.
25 For any claimants whose employment or mortgage claims could not be
26 validated or who only claimed they had been harmed with respect to a credit card,
1
27 Each Defendant provided one archive in each year, and the months of the archives
provided were staggered to include as much information as possible from all three
28 Defendants.
1 auto loan, or other credit applied for, the Settlement Administrator will examine
2 their claims to see if they match credit inquiry codes in the credit files of the
3 Defendants. Again, the Settlement Administrator is working with Defendants to
4 understand the industry codes that would correspond with a credit inquiry.
5 C. Actual Damage Award Claimants and Next Steps
6 The audit of the 1,000 claims is ongoing. The preliminary indications are
7 that the audit will demonstrate that a substantial number of the actual damage
8 claims are questionable and clearly or potentially invalid. Once the review is
9 complete, which Garden City estimates will occur by the end of April 2010, the
10 Settling Plaintiffs will provide a complete report and ask the Court for approval of a
11 process for going forward – but they will make a final determination of what other
12 steps, if any, they believe should be implemented only after the audit is complete.
13 Conclusion
14 The parties and Settlement Administrator are taking all necessary steps to
15 properly validate claims but the process is an extremely time-intensive one. The
16 Settlement Administrator is constantly consulting with the parties in an effort to
17 have the information required to validate all claims. At this time, the parties cannot
18 make a definite determination but they may decide it is necessary to allow certain
19 claimants to submit further documentation to help evaluate their claims. The
20 parties will update the Court before the proposed May 24, 2010 status conference
21 upon the completion of the 1,000 claim audit, but in no event later than May 7,
22 2010.
23
24
25
26
27
28
1
Dated: March 26, 2010 Respectfully submitted,
2
LIEFF, CABRASER, HEIMANN
3 & BERNSTEIN, LLP
4
5 By: /s/ Michael W. Sobol
Michael W. Sobol
6
Michael W. Sobol (State Bar No. 194857)
7 (msobol@lchb.com)
Allison S. Elgart (State Bar No. 241901)
8 (aelgart@lchb.com)
275 Battery Street, 29th Floor
9 San Francisco, CA 94111-3339
Telephone: (415) 956-1000
10 Facsimile: (415) 956-1008
11 Stuart T. Rossman (BBO No. 430640)
(srossman@nclc.org)
12 Charles M. Delbaum (BBO No. 543225)
(cdelbaum@nclc.org)
13 NATIONAL CONSUMER LAW CENTER
7 Winthrop Square, 4th Floor
14 Boston, MA 02110
Telephone: (617) 542-8010
15 Facsimile: (617) 542-8028
16 Michael A. Caddell (State Bar No. 249469)
(mac@caddellchapman.com)
17 Cynthia B. Chapman (State Bar No. 164471)
(cbc@caddellchapman.com)
18 George Y. Niño (State Bar No. 146623)
(gyn@caddellchapman.com)
19 CADDELL & CHAPMAN
1331 Lamar, Suite 1070
20 Houston, TX 77010
Telephone: (713) 751-0400
21 Facsimile: (713) 751-0906
22 Leonard A. Bennett (VSB No. 37523)
(lenbennett@cavtel.net)
23 Matthew Erausquin (VSB No. 65434)
(matt@clalegal.com)
24 CONSUMER LITIGATION ASSOCIATES, P.C.
12515 Warwick Boulevard, Suite 201
25 Newport News, Virginia 23606
Telephone: (757) 930 3660
26 Facsimile: (757) 930-3662
27
28
Cause is called and counsel make their appearances. Parties address the Court with progress on settlement.
The Court orders an interim report to be filed on or before March 26, 2010. The parties will also submit a
briefing schedule. The Court sets a further hearing on these matters for April 20, 2010, at 8:00 a.m.
: 38
Case No. SACV 05-1070 DOC (MLGx) Date: September 21, 2009
DOCKET ENTRY
[I hereby certify that this document was served by first class mail or Government messenger service, postage prepaid, to all counsel (or parties) at their
respective most recent address of record in this action on this date.]
Date:____________ Deputy Clerk: ___________________________________
PRESENT:
THE HONORABLE DAVID O. CARTER, JUDGE
Before the Court is Settling Plaintiffs’ and Defendants’ Joint Ex Parte Application to
Amend the Court’s May 7, 2009 Order (1) Granting Preliminary Approval to Proposed Calss Action
Settlement; (2) Conditionally Certifying Settlement Class; (3) Approving Class Notice; (4) Appointing
Class Counsel; and (5) Scheduling Final Approval Hearing and Related Dates.
Settling Plaintiffs and Defendants have requested an extension of the Final Approval
Hearing and related dates because there has been an unavoidable delay by the Settlement Administrator
in compiling a single class list. The May 7, 2009 Order by this Court set August 31, 2009 as the date
by with Mail Notice should be sent to each identified 23(b)(3) Settlement Class Member, and the
parties now estimate that they will not be able to send the Mail Notice until September 28, 2009.
Therefore, they request that all dates following the Mail Notice date also be pushed back.
The White Plaintiffs object only to the date of December 14, 2009 for the Final Fairness
Hearing, for which they cannot be available.
The Court grants the Ex Parte Application to amend the Final Fairness Hearing and
Related Dates but, as the parties were not able to stipulate to dates acceptable to all, modifies the
proposed dates. It is hereby ORDERED as follows:
1. The Settlement Administrator shall cause the Mail Notice to be sent to each
identified 23(b)(3) Settlement Class Member by September 28, 2009, and shall
establish an Internet web site no later than five days prior to the mailing of the
Mail Notice. Between September 28, 2009 and October 28, 2009, the Settlement
Administrator shall cause the Publication Notice to be published.
2. The deadline for a class member to submit a claim, opt out, or object to the
Settlement shall be November 30, 2009.
4. Any counsel for plaintiffs who wish to apply for an award of fees and costs for
efforts made in connection with the Injunctive Relief Settlement must do so on or
before December 21, 2009.
4. A Final Fairness Hearing shall be set for January 11, 2010 at 8:30 a.m.
The Clerk shall serve this minute order on all parties to the action.
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1 been or could have been asserted in the Litigation based upon the
2 Defendants’ furnishing of consumer reports that contained or were
3 alleged to contain false or misleading reporting of debts, accounts,
4 judgments, or public records, or other obligations, that had been
5 discharged in bankruptcy or their alleged failure to have properly
6 reinvestigated such inaccuracies, by Plaintiffs or the 23(b)(3)
7 Settlement Class Members or any of their respective heirs, spouses,
8 executors, administrators, partners, attorneys, predecessors, successors,
9 assigns, agents and/or representatives, and/or anyone acting or
10 purporting to act on their behalf. Released Claims include, but are not
11 limited to, all claimed or unclaimed compensatory damages, damages
12 for emotional distress, statutory damages, consequential damages,
13 incidental damages, treble damages, punitive and exemplary damages,
14 as well as all claims for equitable, declaratory or injunctive relief under
15 any federal or state statute or common law or other theory that was
16 alleged or could have been alleged based on the facts forming the basis
17 for the Litigation, including but not limited to any and all claims under
18 deceptive or unfair practices statutes, or any other statute, regulation or
19 judicial interpretation. Released Claims further include interest, costs
20 and fees arising out of any of the claims asserted or that could have
21 been asserted in the Litigation. Notwithstanding the foregoing,
22 nothing in this Settlement Agreement shall be deemed a release of the
23 Parties’ respective rights and obligations under this Settlement
24 Agreement.
25 1.39 “Released Parties” means and refers to: (a) Equifax and its present,
26 former and future officers, directors, partners, employees, agents,
27 attorneys, servants, heirs, administrators, executors, members, member
28 entities, shareholders, predecessors, successors, affiliates (including,
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1 1.44 “Settlement Web site” means the Internet Web site established by the
2 Settlement Administrator for purposes of facilitating notice to, and
3 communicating with, the 23(b)(3) Settlement Class.
4 1.45 “TransUnion” means TransUnion LLC.
5 1.46 “TransUnion’s Counsel” means Stroock & Stroock & Lavan LLP.
6 1.47 “23(b)(2) Settlement Class” means the same as defined in Section 2.32
7 in the Approval Order Regarding Settlement Agreement and Release
8 entered by the Court in the Litigation on August 19, 2008.
9 1.48 “23(b)(3) Settlement Class” or “23(b)(3) Settlement Class Member”
10 shall mean and refer to all Consumers who have received an order of
11 discharge pursuant to Chapter 7 of the United States Bankruptcy Code
12 and who, any time between and including March 15, 2002 and the
13 present (or, for California residents in the case of TransUnion, any
14 time between and including May 12, 2001 and the present), have been
15 the subject of a Post-bankruptcy Credit Report issued by a Defendant
16 in which one or more of the following appeared:
17 a. A Pre-bankruptcy Civil Judgment that was reported as
18 outstanding (i.e., it was not reported as vacated, satisfied, paid,
19 settled or discharged in bankruptcy) and without information
20 sufficient to establish that it was, in fact, excluded from the
21 bankruptcy discharge;
22 b. A Pre-bankruptcy Installment or Mortgage Loan that was
23 reported as delinquent or with a derogatory notation (other than
24 “discharged in bankruptcy,” “included in bankruptcy” or similar
25 description) and without information sufficient to establish that
26 it was, in fact, excluded from the bankruptcy discharge;
27 c. A Pre-bankruptcy Revolving Account that was reported as
28 delinquent or with a derogatory notation (other than “discharged
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1 proceeding against Defendants. Defendants have denied and continue to deny each
2 and all of the claims and allegations in the Litigation. Neither this Settlement
3 Agreement nor any document referred to herein, nor any action taken to carry out
4 this Settlement Agreement and/or the Settlement, or their willingness to enter into
5 this Settlement Agreement, nor any or all negotiations, communications, and
6 discussions associated with them are, or may be construed as, or may be used in
7 any proceeding as, an admission by or against any or all Defendants of any fault,
8 wrongdoing or liability whatsoever, or any infirmity of any defenses asserted by
9 any or all Defendants
10 2.2 No Admission by Defendants of Elements of Class Certification
11 Defendants deny that a class should be certified other than for purposes of
12 this Settlement and reserve their rights to contest any litigation class motion.
13 Defendants contend that this Litigation could not be certified as a class action under
14 Federal Rule of Civil Procedure 23(b)(3) and, indeed, this Court has issued a
15 written tentative ruling denying certification of a litigation class that had been
16 proposed by Plaintiffs. Nothing in this Settlement Agreement shall be construed as
17 an admission by any Defendant that this Litigation or any similar case is amenable
18 to class certification for trial purposes. Furthermore, nothing in this Settlement
19 Agreement shall prevent any Defendant from opposing class certification or
20 seeking de-certification of the conditionally certified 23(b)(3) Settlement Class if
21 Final Approval of this Settlement is not obtained, or not upheld on appeal,
22 including review by the United States Supreme Court.
23 III. MOTION FOR PRELIMINARY APPROVAL
24 3.1 On or before April 24, 2009, Proposed 23(b)(3) Settlement Class
25 Counsel shall file this Settlement Agreement with the Court together
26 with a motion for Preliminary Approval that seeks entry of an order
27 that would, for settlement purposes only:
28
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1
[Signature]
2
e. Publication Notice: Between August 31, 2009 and September
3
30, 2009, the Settlement Administrator shall cause the
4
Publication Notice (in a form substantially similar to that
5
attached hereto as Exhibit B and approved by the Court) to be
6
published one time in a nationally distributed newspaper or
7
magazine. Not later than seven (7) days before the Final
8
Fairness hearing, the Settlement Administrator shall cause proof
9
of the publication of the Publication Notice to be filed with the
10
Court.
11
f. Telephone Assistance Program: The Settlement Administrator
12
will establish a toll-free telephone number, which will be staffed
13
by the Settlement Administrator, to answer questions from
14
23(b)(3) Settlement Class Members. The toll-free number will
15
provide access to live support, a voice response unit (“VRU”) or
16
a combination of live support and VRU. Not later than seven
17
(7) days before the Final Fairness hearing, the Settlement
18
Administrator will cause proof of the establishment and
19
maintenance of the Telephone Assistance Program to be filed
20
with the Court.
21
4.4 Expenses of Notice and Administration
22
a. All notice, claims and other administration costs, excluding the
23
costs associated with CAFA Notice as described in Section 4.5,
24
shall be invoiced by the Settlement Administrator and paid
25
promptly from the Settlement Fund.
26
b. Within thirty (30) days after the Effective Date, the Settlement
27
Administrator will provide to the 23(b)(3) Settlement Class
28
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1 current postal address, current telephone number, and last four digits of the class
2 member’s Social Security number. The 23(b)(3) Settlement Class shall also be
3 required to select one of the monetary relief options identified in the Mail Notice.
4 Registrations submitted by U.S. mail shall contain the same information contained
5 in the electronic registration form and the 23(b)(3) Settlement Class Member’s
6 signature and shall be mailed to a separate, dedicated post office box established by
7 the Settlement Administrator exclusively for the purpose of receiving such
8 registrations as provided herein.
9 b. Deceased Claimants
10 Claims may be filed by deceased Claimants through representatives of their
11 estate if appropriate documentation is provided. Any claims paid to a deceased
12 Claimant shall be made payable to the estate of the deceased Claimant.
13 c. Determining Adequacy of Claims
14 Registration forms, whether submitted electronically via the Settlement
15 Website or by U.S. Mail, that do not meet the requirements as set forth in this
16 Settlement Agreement and in the registration form instructions shall be rejected.
17 This shall include but is not limited to any failure to provide accurate information,
18 any failure to make the required representations and attestations concerning
19 membership in the 23(b)(3) Settlement Class, and any failure to sign a registration
20 form submitted by U.S. Mail.
21 The Settlement Administrator shall have the authority to determine whether
22 registration by any 23(b)(3) Settlement Class Member is complete and timely. The
23 Settlement Administrator’s determinations in this regard shall be final and non-
24 appealable. Any 23(b)(3) Settlement Class Member whose claim is rejected shall
25 be barred from receiving any payment from the Settlement Fund, but shall in all
26 other respects be bound by the terms of this Settlement Agreement and by the Final
27 Approval Order entered in the Litigation, unless such 23(b)(3) Settlement Class
28 Member has submitted a timely request to opt out pursuant to Subsection 5.2a.
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1 the date set by the Court in its order preliminarily approving this
2 Settlement Agreement.
3 b. All responses to Objections submitted pursuant to Section 5.3a
4 shall be filed by October 30, 2009.
5 VI. FINAL FAIRNESS HEARING AND FINAL APPROVAL
6 6.1 Final Fairness Hearing
7 The Court will hold the Final Fairness Hearing to consider approval of the
8 Settlement of the Litigation as provided for herein on November 9, 2009. On or
9 before October 19, 2009, Proposed 23(b)(3) Settlement Class Counsel shall file a
10 motion for entry of the Final Approval Order. The Parties agree that the Final
11 Approval Order constitutes a dismissal of this Litigation with prejudice.
12 6.2 Final Approval
13 All of the affirmative relief contemplated by this Settlement Agreement is
14 expressly contingent upon the Settlement Agreement receiving the Court’s Final
15 Approval.
16 VII. SETTLEMENT FUND
17 7.1 Creation of and Deposit Into Settlement Fund
18 a. Within ten (10) days following Preliminary Approval, if by that
19 date the Injunctive Relief Fee Agreement has been signed by the
20 Parties to this Agreement, the Parties will petition the Court for
21 approval to deposit the Settlement Fund with the Registry of the
22 Court, pursuant to Fed. R. Civ. P. 67. By the later of (1) seven
23 (7) days thereafter or (2), June 15, 2009, each Defendant shall
24 cause to be deposited into the Registry of the Court an amount
25 equal to fifteen million dollars ($15,000,000.00). The
26 Defendants’ payments are several, and not joint.
27 b. Until such time as the Settlement Fund shall be used or
28 disbursed as provided in this Settlement Agreement and as
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1
Type Amount of Award
2
3. Other Credit Inquires If the Actual Damage Award Claimant’s File
3
shows a Post-bankruptcy Hard Inquiry within
4
six (6) months of the date provided by the
5
Actual Damage Award Claimant, and such
6
Claimant has not opted for an Employment or
7
a Mortgage/Housing award, then the award
8
shall be $150.
9
(iv) The Settlement Administrator shall pay to the Actual
10
Damage Award Claimant the highest award for which he
11
or she is eligible. Awards hereunder shall not be
12
cumulative. The applicable award for each category will
13
be increased or decreased, pro rata, to reflect (i) the
14
number of valid claims in each category of Actual
15
Damage Awards, and (ii) the funds available for
16
distribution to the Actual Damage Award Claimants,
17
including the addition of any unclaimed or uncashed
18
Convenience Awards as set forth in Section 7.7b.
19
(v) If the Settlement Administrator determines that a Actual
20
Damage Award Claimant is ineligible for a Actual
21
Damage Award, then such Actual Damage Award
22
Claimant’s claim shall be converted into a Convenience
23
Award Claim.
24
7.8 Capped Fund
25
Except for the costs of CAFA Notice pursuant to section 4.5 hereof, all of the
26
following must be paid from the $15,000,000.00 (fifteen million dollars) paid into
27
the Settlement Fund by each Defendant: (i) notice and administration costs,
28
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1 including without limitation the costs incurred by each Defendant in providing any
2 additional information requested by Plaintiffs and/or 23(b)(3) Settlement Class
3 Counsel, which shall be reimbursed promptly to each Defendant from the
4 Settlement Fund; (ii) payments to the Claimants; and (iii) payments to 23(b)(3)
5 Settlement Class Counsel for Monetary Relief Fees. The Parties and their
6 respective counsel agree that under no circumstances will each Defendant pay or
7 cause to be paid more than $15,000,000.00 (fifteen million dollars) pursuant to this
8 Settlement.
9 VIII. RELEASE OF CLAIMS
10 8.1 Release of All Claims
11 Upon the Effective Date, Plaintiffs and each member of the 23(b)(3)
12 Settlement Class who has not opted out and his or her respective spouses, heirs,
13 executors, administrators, representatives, agents, attorneys, partners, successors,
14 predecessors and assigns and all those acting or purporting to act on their behalf
15 acknowledge full satisfaction of, and shall be conclusively deemed to have fully,
16 finally and forever settled, released and discharged the Released Parties of and from
17 all Released Claims. Subject to the Court’s approval, all 23(b)(3) Settlement Class
18 Members shall be bound by this Settlement Agreement and all of their Released
19 Claims shall be dismissed with prejudice and released as against the Released
20 Parties, even if they never received actual notice of the Settlement prior to the
21 hearing on final approval of the Settlement.
22 8.2 Waiver of California Civil Code Section 1542
23 Plaintiffs, for themselves and for each 23(b)(3) Settlement Class Member,
24 acknowledge that they are aware that they may hereafter discover facts in addition
25 to or different from those that they or 23(b)(3) Settlement Class Counsel now
26 knows or believes to be true with respect to the subject matter of these releases, but
27 it is their intention to, and they do hereby, upon the Effective Date of this
28 Settlement Agreement, fully, finally and forever settle and release any and all
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1 under this Settlement Agreement to any of the Defendants in the event that any two
2 of the three Defendants exercises their right to terminate this Settlement Agreement
3 pursuant to Section 9.1 hereof, and Plaintiffs exercise their termination right within
4 thirty (30) days of the second Defendant’s exercise of its termination right.
5 9.4 Plaintiffs’ Right To Seek Modification Of This Settlement Agreement
6 Plaintiffs shall have the unilateral and unfettered right to seek from the Court
7 a modification of this Settlement Agreement in the event that: (a) one of the three
8 Defendants exercises its right to terminate this Settlement Agreement pursuant to
9 Section 9.1 hereof; or (b) prior to the dissemination of class notice, one or more of
10 the Defendant’s class lists provided to the Settlement Administrator pursuant to
11 Section 4.1 hereof exceeds twelve million (12,000,000) class members. Plaintiffs’
12 right to seek such modification extends to, but is not limited to, the amount and
13 manner of payments of Convenience Awards or Actual Damage Awards, the
14 manner and method of notice to the Class, and the general administration of the
15 Settlement, but shall expressly exclude any modification to the scope of the releases
16 provided herein or any modification to the amounts paid by Defendants as provided
17 herein.
18 9.5 The failure of any Court to approve the Monetary Relief Fees or the
19 Injunctive Relief Fees in the requested amounts or any amounts whatsoever, shall
20 not be grounds for Named Plaintiffs or Proposed 23(b)(3) Settlement Class Counsel
21 to terminate this Settlement Agreement.
22 9.6 Effect of Termination on This or Future Litigation
23 If this Settlement Agreement is terminated and only as to those Parties to the
24 extent the Settlement Agreement has been terminated as to them:
25 a. the class-certification portions of the Settlement Agreement
26 shall have no further force and effect and shall not be offered in
27 evidence or used in the Litigation or any other proceeding;
28
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1 b. counsel for the Parties shall seek to have any Court orders,
2 filings, or other entries in the Court’s file that result from this
3 Settlement Agreement set aside, withdrawn, and stricken from
4 the record;
5 c. the Settlement Agreement and all negotiations, proceedings, and
6 documents prepared, and statements made in connection with
7 either of them, shall be without prejudice to any party and shall
8 not be deemed or construed to be an admission or confession by
9 any Party of any fact, matter, or proposition of law; and
10 d. the Parties shall stand in the same procedural position as if the
11 Settlement Agreement had not been negotiated, made, or filed
12 with the Court.
13 9.7 Effect of Termination on Monies Paid by Defendants Pursuant to
14 Settlement Agreement
15 If this Settlement Agreement is terminated and only as to those Defendants to
16 the extent that the Settlement Agreement is terminated as to some of them: The
17 Settlement Fund, including interest earned, less Taxes, Tax Expenses, and notice,
18 claims, and other administration costs (including fees, costs, and other expenses of
19 the Court Registry) that have been properly disbursed pursuant to this Settlement
20 Agreement, shall be returned to such Defendant(s) and such Defendant’s insurers in
21 equal proportions to their contributions into the Settlement Fund.
22 X. PUBLIC STATEMENTS
23 10.1 The Parties will negotiate and agree upon the language that may be
24 used in press releases and other forms of public statements concerning the
25 Settlement that would be issued prior to entry by the Court of the Final Approval
26 Order.
27 The Parties and/or their counsel shall make no statements to any third party
28 regarding the Settlement prior to entry by the Court of the Final Approval Order,
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1 without the reasonable consent of the other Parties or his, her or its counsel, unless
2 such statements are reasonably necessary in effecting the terms of this Settlement
3 Agreement, or are required by law, including, without limitation, any disclosure
4 obligations imposed on Defendants by federal or state securities or tax laws.
5 Subsequent to the entry by the Court of a Final Approval Order, no party shall
6 make any public statements concerning this Settlement or this Litigation that
7 contains disparaging language of any of the Parties or their counsel.
8 10.2 Proposed 23(b)(3) Settlement Class Counsel and all Defendants’
9 Counsel agree that all extra-judicial statements in regard to the Settlement will
10 comport with Rule 5-120 of the California Rules of Professional Conduct.
11 Proposed 23(b)(3) Settlement Class Counsel may communicate with Claimants,
12 23(b)(3) or 23(b)(2) Settlement Class Members, clients, or potential clients.
13 XI. MISCELLANEOUS PROVISIONS
14 11.1 Admissibility of Settlement Agreement
15 This Settlement Agreement shall not be offered or be admissible in evidence
16 in any action or proceeding except (1) the hearings necessary to obtain and
17 implement Court approval of this Settlement; or (2) any hearing to enforce the
18 terms of this Settlement Agreement or any related order by the Court.
19 11.2 Successors and Assigns
20 The terms of this Settlement Agreement shall apply to and bind the Parties as
21 well as their heirs, successors and assigns.
22 11.3 Communications Relating to Settlement Agreement
23 All notices or other formal communications under this Settlement Agreement
24 shall be in writing and sent by mail to counsel for the party to whom the notice is
25 directed at the following addresses:
26
27
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1 Equifax:
2 Craig E. Bertschi, Esq.
Cindy Hanson, Esq.
3 KILPATRICK STOCKTON LLP
1100 Peachtree Street, Suite 2800
4 Atlanta, GA 30309-4530
5 Experian:
Daniel J. McLoon, Esq.
6 Michael G. Morgan, Esq.
JONES DAY
7 555 South Flower Street
Fiftieth Floor
8 Los Angeles, CA 90071-2300
9 TransUnion:
10 Julia B. Strickland, Esq.
Stephen J. Newman, Esq.
11 STROOCK & STROOCK & LAVAN LLP
2029 Century Park East, Suite 1800
12 Los Angeles, CA 90067
13 Plaintiffs:
Michael W. Sobol, Esq.
14 LIEFF CABRASER HEIMANN & BERNSTEIN, LLP
275 Battery Street, 30th Fl.
15 San Francisco, California 94111
16 Michael Caddell, Esq.
CADDELL & CHAPMAN
17 1331 Lamar, Suite 1070
Houston, TX 77010
18
Lee A. Sherman, Esq.
19 CALLAHAN, MCCUNNE & WILLIS, APLC
111 Fashion Lane
20 Tustin, California 92780-3397
21
Any Party may, by written notice to all the other Parties, change its designated
22
recipient(s) or notice address provided above.
23
11.4 Defendants’ Communications with Consumers in the Ordinary Course
24
of Business
25
Defendants reserve the right to continue communicating with their customers
26
and Consumers, including 23(b)(3) Settlement Class Members, in the ordinary
27
course of business. To the extent Consumers initiate communications regarding
28
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1 this Settlement Agreement, Defendants may confirm the fact of a settlement and
2 refer inquiries to the Settlement Administrator. Nothing herein is intended to
3 prohibit Defendants from communicating with Consumers regarding disputes
4 relating to tradelines and the reporting of Chapter 7 bankruptcies.
5 11.5 Efforts to Support Settlement
6 The Parties and their counsel agree to cooperate fully in seeking Court
7 approval for this Settlement Agreement and to use their best efforts to effect the
8 consummation of the Settlement and to protect the Settlement Agreement by
9 applying for appropriate orders enjoining others from initiating or prosecuting any
10 action arising out of or related to facts or claims alleged in the Litigation, if so
11 required.
12 11.6 Procedures for Disputes Between Parties Relating to the Settlement
13 Agreement
14 To the extent any disputes or issues arise with respect to documenting or
15 effecting the Settlement Agreement, the Parties agree to use their best efforts to
16 informally resolve any such disputes or issues; but in the event any such dispute or
17 issue cannot be resolved informally, to bring any such dispute or issue to the Court
18 for resolution.
19 11.7 Entire and Voluntary Agreement
20 The Parties intend the Settlement Agreement to be a final and complete
21 resolution of all disputes between them, except for those disputes relating to the
22 Injunctive Relief Fee Agreement and except as further specifically provided for
23 herein. The Parties agree that the terms of the Settlement Agreement were
24 negotiated at arm’s length and in good faith and were reached voluntarily after
25 consultation with competent legal counsel. This Settlement Agreement contains the
26 entire agreement and understanding concerning the subject matter between the
27 Parties, excluding those subjects that relate to the Injunctive Relief Fee Agreement,
28 and supersedes all prior negotiations and proposals, whether written or oral. No
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1 other party or any agent or attorney of any other party has made any promise,
2 representation or warranty whatsoever not contained in this Settlement Agreement
3 and the other documents referred to in this Settlement Agreement to induce them to
4 execute the same. The Parties represent that they have not executed this instrument
5 or the other documents in reliance on any promise, representation or warranty not
6 contained in this Settlement Agreement and the other documents referred to in this
7 Settlement Agreement.
8 11.8 Headings for Convenience Only
9 The headings in this Settlement Agreement are for the convenience of the
10 reader only and shall not affect the meaning or interpretation of this Settlement
11 Agreement.
12 11.9 Settlement Agreement Controls
13 All of the exhibits attached hereto are hereby incorporated by reference as
14 though fully set forth. To the extent that there is any conflict between the terms of
15 this Settlement Agreement and the exhibits attached hereto, this Settlement
16 Agreement shall control.
17 11.10 Amendments
18 The Settlement Agreement may be amended or modified only by a written
19 instrument signed by Defendants and 23(b)(3) Settlement Class Counsel, or their
20 respective successors-in-interest.
21 11.11 Authorization of Counsel
22 a. Proposed 23(b)(3) Settlement Class Counsel, on behalf of the
23 23(b)(3) Settlement Class, are expressly authorized by Plaintiffs
24 to take all appropriate action required or permitted to be taken
25 by the 23(b)(3) Settlement Class pursuant to the Settlement
26 Agreement to effectuate its terms, and also are expressly
27 authorized to enter into any modifications or amendments to the
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