A leading federal court recently announced a detailed procedure for proposed settlements in class action litigation.
On November 1, 2018, the United States District Court for the Northern District of California announced a new and revised protocol, entitled ”Procedural Guidance for Class Action Settlements.” The Guidance provides advice to judges and lawyers who are working on class action settlements in that courthouse, with detailed suggestions for: (a) information to be included in a Motion for Preliminary Approval of a Class-Wide Settlement; (b) the form and content of the Notice to Class Members; (c) the procedure for handling opt-outs and objections; (d) the information to be provided in a request for attorneys’ fees; (e) the information to be included in a Motion for Final Approval of a Class Action Settlement; and (f) the accounting information to be reported as a follow-up to a Final Distribution of settlement funds. The Guidance calls for more specificity than most people are accustomed to providing. A copy of the Guidance is here.
The Guidance is advisory, which means that judges in that courthouse are not required to reject settlements if the record does not answer each question raised in the Guidance. But the Guidance is important, because the District now requires class action counsel to confirm that they have reviewed the Guidance. (See Standing Order, at ¶9.) And the judges there might ask lawyers to explain any departure from the Guidance.
To date, no other courthouse has followed the lead of the California court. That is, no other District has adopted the Guidance as its own. But any individual federal judge — no matter where they serve — could adopt some or all of the Guidance as part of their own Standing Orders. And any judge could use the Guidance in a particular case, especially when asking questions about a proposed settlement.
Before proceeding in any class action in the Northern District of California, lawyers should carefully study the Guidance. And over the next few years, all of us should monitor how judges are using the Guidance, in California and elsewhere.
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