United States District Court, D. Nebraska
JANNETTE TAYLOR, on behalf of herself and all others similarly situated; Plaintiff,
MERCHANTS CREDIT ADJUSTORS, INC., and PANSING, HOGAN, ERNST & BACHMAN, L.L.P., Defendants.
MEMORANDUM AND ORDER
F. Bataillon Senior United States District Judge
matter is before the court on the plaintiff's motion for
final approval of a class action settlement after a final
fairness hearing on May 17, 2018, Filing No. 76.
This is a class action for alleged violations of the Fair
Debt Collection Practices Act (“FDCPA”), 15
U.S.C. § 1692. Defendants Merchants Credit Adjusters,
Inc. (“MCA”) and Pansing, Hogan, Ernst &
Bachman, LLP (“Pansing”) (collectively
“Defendants”) do not oppose the plaintiff's
approving a class settlement, the district court must
consider whether it is fair, reasonable, and adequate.
DeBoer v. Mellon Mortgage Co., 64 F.3d 1171, 1178
(8th Cir. 1995). A district court is required to consider
four factors in determining whether a settlement is fair,
reasonable, and adequate: (1) the merits of the
plaintiff's case, weighed against the terms of the
settlement; (2) the defendant's financial condition; (3)
the complexity and expense of further litigation; and (4) the
amount of opposition to the settlement. Huyer v.
Njema, 847 F.3d 934, 939 (8th Cir. 2017). “The
first factor is the ‘single most important
factor.'” Id. (quoting Van Horn v.
Trickey, 840 F.2d 604, 607 (8th Cir. 1988)). A court may
also consider procedural fairness to ensure the settlement is
“not the product of fraud or collusion.” In
re Wireless Tel. Fed. Cost Recovery Fees Litig., 396
F.3d 922, 934 (8th Cir. 2005). The experience and opinion of
counsel on both sides may be considered, as well as whether a
settlement resulted from arm's-length negotiations, and
whether a skilled mediator or magistrate judge was involved
in settlement negotiations. See DeBoer, 64 F.3d at
1178 (noting that multiple layers of scrutiny further
militate in favor of the settlement). With respect to notice,
due process is satisfied where class members receive notice
of a settlement proposal and are able to argue their
objections to district court. Id. at 1176.
the terms of the proposed settlement, Pansing will pay $23,
320.00 to class members in the class designated FDCPA Fund 1
and $75, 000.00 to class members in the class designated NCPA
Fund 2. Filing No. 67-1, Settlement Agreement. The
defendants will be released from the individual and class
claims alleged in the lawsuit. Id. The court finds
the proposed settlement satisfies all of the requirements for
class certification under Fed.R.Civ.P. 23 and is fair,
adequate and reasonable.
court approved the parties' procedure for providing
notice of the settlement to all class members identified from
the defendants' records under Rule 23(c)(2)(B).
Filing No. 68, Findings and Recommendation
(“F&R”) at 6; Filing No. 69, Order
at 2. The record shows the defendants furnished the initial
class list, containing just over 12, 000 records, to the
class administrator, Dahl Administration. Filing No.
78-1, Ex.1, Affidavit of Kelly Kratz (“Kratz
Aff.”) at 2. Prior to mailing the notices, the class
administrator, Dahl Administration, followed its standard
practice of checking for and removing exact duplicate records
within the class list. Id. The parties notified the
proposed class members of the proposed settlement by mailing
written notice of the proposed class action settlement to
each of the 11, 326 class members in the form approved by the
court. Id. Of the 11, 326 notices sent, 2, 363 were
returned as undeliverable and sent to a professional address
search firm for tracing. Id. The search firm was
able to locate 2, 022 updated addresses for those that had
been returned. One request for exclusion was received by the
class administrator. Id. The class members also had
an opportunity to object to the proposed settlement by filing
a written objection. Id. No objections were filed or
served on counsel. Id. No one appeared at the
hearing to object to the settlement.
court has granted the plaintiff's unopposed motion for an
award of attorneys' fees in the amount of $57, 000.00 and
for statutory penalties and incentive payments to the class
representative in the amount of $6000.00. Filing No.
79. The parties have shown that payments to members of
Settlement Fund 2 for the NCPA class range from $746.77 to
$4.54 and the total amount paid to class members from
Settlement Fund 2 is $34, 919.44. Filing No. 78-5,
Ex. 2, Declaration of William Reinbrecht (“Reinbrecht
Decl.”) at 2; id., Ex. 2A, Spreadsheet. The
balance of $40, 080.56 from the Actual Damages class will be
paid on a pro rata basis to the 2, 504 members of the FDCPA
class. Filing No. 78-4, Ex. 2, Reinbrecht Decl. at
2. The parties have shown that each of the over 2, 500 FDCPA
Fund 1 class members will receive a check for approximately
court approves payment to all class members of the FDCPA
Class No. 1 and FDCPA Class No. 2 in the amount of each class
member's pro rata share of Settlement Fund No. 1 plus the
funds remaining after payment of claims from Settlement Fund
No. 2. The court also approves the distribution to the
members of NCPA Class No. 1 and NCPA Class No. 2 that is set
forth in Filing No. 81 (Hearing Exhibit 1) and in the
Spreadsheet at Filing No. 78-5.
settlement provides that any funds remaining from settlement
checks un-cashed (i.e., checks not cashed 90 days after the
check date) or other undistributed funds shall be awarded to
the mutually agreed-upon cy pres recipient. Filing
No. 78-4 at 3. The court approves Legal Aid of Nebraska as
the cy pres recipient. Id. At the final
fairness hearing, the plaintiff orally moved for approval of
payments from cy pres funds to seven class members
who submitted claims after the deadline. The defendants are
not opposed to that distribution. The court finds that
request should be approved.
parties have also shown compliance with the Class Action
Fairness Act of 2005, Pub. L. No. 109-2, 119 Stat. 4
("CAFA"). Pursuant to 28 U.S.C. § 1715, the
Settlement Administrator, served written notice of the
proposed settlement on the appropriate state and federal
regulators. Filing No. 78-1, Ex. 1, Kratz Aff. at 2.
No. response or objection was received from any regulatory
settlement purposes the court preliminarily ruled that the
proposed class satisfies each of the Fed.R.Civ.P. 23(a) and
(b) prerequisites. See Filing Nos. 68, Findings
& Recommendation; 69, Order of Preliminary Approval. The
court's findings in those orders are incorporated herein.
court now finds the settlement should be granted final
approval. The court further finds that the requirements of
due process have been met as to the method and content of the
notice to the class members. The court has reviewed the
notices and proofs of service and finds them satisfactory.
The court further finds that the settlement agreement is fair
and reasonable. In addition to providing some monetary
compensation to class members, the proposed settlement
provides the important benefit of injunctive relief in that
the defendants have altered their business practices. There
are no objections to the settlement. Under the circumstances,
the court finds the settlement is fair, reasonable, adequate
and in the best interests of the class. Accordingly, the
court finds that the proposed settlement should be approved.
IT IS ORDERED:
plaintiff's motion for final approval of a class action