CY PRES SETTLEMENTS SHOULD BE CONSIDERED ON A CASE-BY-CASE BASIS
But Maximizing Proceeds For the Class Should Be the Primary Goal
Most survey respondents – and 80% of attorneys – say cy pres settlements should be considered on a case-by-case basis. Only 21% say cy pres should never be regarded as an alternative to providing more money to the class.
Respondents and interviewees overall say that cy pres-related settlements, such as residual donations, are generally sound and appropriate as part of a multi-phased disbursement. Judges and mediators, in particular, widely agree (83%) on the relevance of cy pres in these situations.DOWNLOAD THE REPORT
The recipient of the cy pres settlement should have some connection to what the purpose of the case was about but not chosen based on relationships.Survey Respondent, Class Action Mediator
“Professional” Objectors Are Viewed With Skepticism, But Good-Faith Objectors Are Seen As Valid and Good For the System
Objectors to class action settlements – which were ﬁled on more than 50% of cases in which survey respondents were involved over the past year – engender strong feelings among attorneys, judges, mediators, and administrators.
Argued with speciﬁcity and in the class’ best interest. These note only make settlements stronger and fairer, but collectively improve the entire class action system.
Frivolous, vague objections aimed at extracting payments for the lawyers who ﬁled them. These remain a detriment to the class action system.DOWNLOAD THE REPORT
Challenging Optics Producing Hesitancy Around Quick-Pay Provisions
Quick-pay provisions have become increasingly popular over the past several years, but many harbor doubts about the optics and value of asking courts to compensate attorneys before class members are paid.
One advantage to seeking quick-pay may be the dampening effect it seems to have on bad-faith objectors seeking to extract payments for themselves. However, many harbor doubts about the optics and ultimate value of asking courts to compensate attorneys before class members are paid — it can sow skepticism about the attorneys’ motivations.DOWNLOAD THE REPORT
If you use quick-pay, [bad faith objectors] are less likely to [object] because the money factor is off the table.Jay Edelson, FOUNDER AND CEO OF EDELSON PC
Rule 23 Impacts Are Viewed with Increasing Positivity Across All Stakeholders
More than two years after implementing the amendments to Rule 23, perceptions among all the stakeholders represented in the survey remain overwhelmingly — and increasingly — favorable. And even as bad-faith objectors have not gone away, the rule change aimed at discouraging their participation grew in popularity from 2020-2021.
The results show that more than two years after the rule changes went into effect, a strong and effective system for adjudicating class actions has been made even more robust.DOWNLOAD THE REPORT
Western Alliance Bank’s Settlement Services Group engaged its third party research and market intelligence partner in speaking to key stakeholders about trends and developments in the class action and appellate process. The research took place from January to April 2021.
The research included 11 in-depth interviews and an online survey of 155 respondents involving 85 attorneys (45 plaintiffs’ counsel and 40 defense counsel), 35 claims administrators, 22 mediators and 13 judges, with questions that covered:
- • Cy pres settlements
- • Quick-pay provisions
- • Appeals and objections process Rule 23 amendments
Half of all survey respondents said they dealt with 50 or more class action cases in their careers.
Western Alliance Settlement Services, a national banking group within Western Alliance Bank, Member FDIC, specializes in banking for law firms, claims administrators and related businesses managing class action, mass tort and bankruptcy settlements. This team of expert bankers brings clients years of experience and offers exceptional service in supporting all phases of the settlement process, from escrow to distribution, with a single point of contact. Western Alliance Bank is the primary subsidiary of Phoenix-based Western Alliance Bancorporation, with approximately $50 billion in assets. The bank is again #1 best-performing of the 50 largest public U.S. banks in the new S&P Global Market Intelligence listing for 2020 and ranks high on the Forbes “Best Banks in America” list year after year. Serving clients across the country wherever business happens, Western Alliance Bank operates individually branded, full-service banking divisions and has offices in key markets nationwide.