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What is the Northern District of CA Procedural Guidance for Class Action Settlements?

As many class action practitioners are aware, on November 1, 2018, The Northern District of California expanded upon its already widely-accepted guidelines for class action settlements.. These guidelines represent the most detailed notes for settlement administrators in the country. The additions to the guidelines, which originated in 2014, seek to make class action settlement litigation, administration, and reporting more transparent.

The Northern District of California is one of the largest and most respected courts in the country, and it is expected that other districts will adopt their own versions of these guidelines in the near future.

Preliminary Approval Guidelines

  • Preliminary approval information shall include: differences between settlement class and proposed class; explanation of differences; anticipated class recovery; proposed allocation plan for the settlement fund; an estimate of class members expected to submit a claim form; and any known circumstances where class recovery funds may revert back to the defendant.
  • The proposed settlement administrator and selection process should be provided in the Motion for Preliminary Approval, along with the anticipated administrative costs.
  • The class notice should be easy to understand and include the contact information for those with authority to answer questions, a web address maintained by class counsel, instructions on accessing the case docket, and a listing of the date of the final approval hearing. Class members who wish to opt-out should be advised of the methods, deadlines, and consequences of doing so. Class members who wish to object should be advised of the protocol for submitting an objection as well as the deadline.
  • Attorney fees must be outlined for preliminary approval, including expert fees and expenses.
  • Incentive awards may not be requested until the final approval hearing, but any anticipated awards should be provided in advance, along with supporting evidence.
  • Cy Pres awardees should be identified with any preexisting relationships between the recipient and counsel disclosed.
  • Parties should ensure class members have at least 35 days to opt-out or object to a settlement and the motion for attorney costs and fees.
  • Preliminary procedures should comply with the Class Action Fairness Act and Rule 23.
  • Electronic versions must be submitted.

Final Approval Guidelines

  • The Motion for Final Approval should contain information about the number of undeliverable notices and claim packets, the number of valid claims, the number of opt-outs, and the number of objections.
  • Requests for attorney fee approval should include the number of hours spent on various categories of activities, along with a sufficient hourly billing rate.
  • Requests for incentive awards must be supported by evidence of the proposed awardees’ worthiness.
  • Electronic versions must be submitted.

Post-Distribution Guidelines

  • A post-distribution accounting should be submitted within 21 days after distribution of the settlement funds, which includes: the total settlement fund, number of class members, un-deliverables, percentage of claim forms submitted, average and median recoveries per claimant, the largest and smallest amounts paid to class members, what percentage of checks not cashed, administrative costs, and the attorney fees. The number of non-monetary relief discount coupons or debit cards should also be included. These post-distribution accounting charts should be posted on the settlement website.

What California’s Procedural Guidance Means for You

Failure to follow any portion of these guidelines could mean delay or denial of approval. Therefore, it is imperative that you understand the finer points of class action administration or partner up with class action settlement administrators who do. If you have questions about the new Northern District guidelines and how they pertain to your class action settlement, our experts are trained to help by adhering to the industry’s best practices. Contact Heffler Claims Group for a free consultation. 

Heffler Claims Group
Heffler Claims Group is a national leader in class action settlement administration, specializing in the notice and administration of complex legal matters. Together with Prime Clerk, the leading bankruptcy claims and noticing agent and another Duff & Phelps company, we offer the most comprehensive administrative services in the industry.


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