Ninth Circuit Also Gives Some Clues Relating To Approved Fee Settlement On Remand, In 2-1 Decision.
The Ninth Circuit, in In re Hyundai & Kia Fuel Economy Litig., Case Nos. 15-56014 et al. (9th Cir. Jan. 23, 2018) (published), faced an appeal of a class action settlement in the Hyundai fuel efficiency litigation. Among other things, the district judge approved $8.9 million in fees to a series of class counsel, with a positive multiplier of 1.22 – 1.5521 depending on the counsel involved. On appeal, the settlement got remanded mainly on settlement class certification merits bases, but the majority did have some guidance for the district court when relooking at the fee recovery—over a dissent by Circuit Judge Nguyen.
The majority decision faulted the district court with not making a finding regarding the settlement value given that various figures were reported – ranging from $44 million to $210 million, but with no express determination of valuation being made by the district judge. Although the district judge found the matter was complex so as to justify a positive multiplier, the majority was not so sure given the belief the class action benefit was modest and given that the fees were to be paid separately such as to raise an inference of collusion. Circuit Judge Nguyen, in her dissent, articulated that the majority determinations were interesting because (1) objectors below only challenged the awarded multipliers, (2) the majority used a $44 million claims-made number as of a certain date, ignoring $65 million in pending claims afterwards, and (3) the $8.9 million fee award was only 14% of the pending $65 million in claims, which was well below the presumptive 25% benchmark approved many times by the Ninth Circuit already.