§1712 — Title 28 Judiciary and Judicial Procedure | U.S. Code

Summary

When a class action settlement gives class members coupons, the part of lawyers’ fees tied to those coupons must be based on how much the redeemed coupons are really worth to the class. If some of the fee is not based on coupon value, then that part must be based on the reasonable time the lawyers spent working on the case. The court must approve those fees and can include pay for getting non-money relief, like an injunction. The court may allow an expert to testify about the real value of redeemed coupons. The court can only approve a coupon settlement after a hearing and a written finding that the deal is fair and good for class members. The court may also require unused coupon value to go to agreed charities or government groups. Any money from those unclaimed coupons cannot be used to figure lawyers’ fees.

Title 28, §1712

Judiciary and Judicial Procedure — Source: USLM XML via OLRC

(a)If a proposed settlement in a class action provides for a recovery of coupons to a class member, the portion of any attorney’s fee award to class counsel that is attributable to the award of the coupons shall be based on the value to class members of the coupons that are redeemed.

(b)(1)If a proposed settlement in a class action provides for a recovery of coupons to class members, and a portion of the recovery of the coupons is not used to determine the attorney’s fee to be paid to class counsel, any attorney’s fee award shall be based upon the amount of time class counsel reasonably expended working on the action.

(2)Any attorney’s fee under this subsection shall be subject to approval by the court and shall include an appropriate attorney’s fee, if any, for obtaining equitable relief, including an injunction, if applicable. Nothing in this subsection shall be construed to prohibit application of a lodestar with a multiplier method of determining attorney’s fees.

(c)If a proposed settlement in a class action provides for an award of coupons to class members and also provides for equitable relief, including injunctive relief—

(1)that portion of the attorney’s fee to be paid to class counsel that is based upon a portion of the recovery of the coupons shall be calculated in accordance with subsection (a); and

(2)that portion of the attorney’s fee to be paid to class counsel that is not based upon a portion of the recovery of the coupons shall be calculated in accordance with subsection (b).

(d)In a class action involving the awarding of coupons, the court may, in its discretion upon the motion of a party, receive expert testimony from a witness qualified to provide information on the actual value to the class members of the coupons that are redeemed.

(e)In a proposed settlement under which class members would be awarded coupons, the court may approve the proposed settlement only after a hearing to determine whether, and making a written finding that, the settlement is fair, reasonable, and adequate for class members. The court, in its discretion, may also require that a proposed settlement agreement provide for the distribution of a portion of the value of unclaimed coupons to 1 or more charitable or governmental organizations, as agreed to by the parties. The distribution and redemption of any proceeds under this subsection shall not be used to calculate attorneys’ fees under this section.

Statutory Notes and Related Subsidiaries

Effective Date

Section applicable to any civil action commenced on or after Feb. 18, 2005, see section 9 of Pub. L. 109–2, set out as an

Effective Date

of 2005 Amendment note under section 1332 of this title.

§1712 Coupon Settlements

Summary

Title 28, §1712

Notes & Related Subsidiaries

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Citations & Metadata