Source - Developments in Class Action Law

Class Action Decisions Published February 2023

Highlights from this issue include:

Arbitration. The Ninth Circuit held Xerox waived its right to compel arbitration against putative class members when it acted inconsistently with its right to arbitrate prior to class certification in litigation against a named representative to which it unquestionably could not request arbitration. 

Attorneys’ Fees. The Federal Circuit vacated an $185 million award of attorneys’ fees in a class action settlement. The Federal Circuit vacated the award for three reasons.

  • First, the Claims Court failed to perform a lodestar cross-check as expressly guaranteed in the court-approved class notices.
  • Second, the declaration submitted by Class Counsel indicated the lodestar amount would be no more than $10 million, and the $185 million award was approximately 18 to 19 times more. The Federal Circuit noted that a number of courts have awarded multipliers in the range of 1 to 4 but a multiplier of 18 or 19 “is far outside the evidence relevant norm and so would require exception justification.”
  • Third, the Federal Circuit held the Claims Court “misconceived its task as one in which the request for fees was presumptively to be granted, subject only to challengers’ demonstration that the request is outside the range of reasonableness and must be reduced.”

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