Class Action Two-Fer: Class Counsel Fee Recovery Affirmed In Face Cream Class Action And Plaintiff Class Action Representative Suffers Adverse Fee Award Under The Consumers Legal Remedies Act For Bad Faith Prosecution

 

#1: Choi v. Mario Badescu Skin Care, Case No. B257480 (2d Dist., Div. 3 Apr. 29, 2016) (Unpublished).

     Caption: “Testing cosmetics. Washington D.C. July 10, 1937. The department of Agriculture is making tests everyday in order to get cosmetics under the Pure Food and Drug Act, Mrs. C.W. West seated is helping Mrs. R. Goodman make a test on cold cream and other facial creams.”  Library of Congress.

     In this class action, defendants agreed to settle a nationwide class of face cream purchasers claiming that not all the ingredients were disclosed (which could lead to certain physical injuries). The settlement gave class members a $45 certificate discount, valued at around $2.4 million and excepted out from releases any personal injury claims. Class counsel requested $1.2 million based on a “clear sailing” clause (a clause saying the defense would not challenge such a request), and the lower court awarded $864,324 (which involved a 1.8 multiplier and was 72% of the requested amount). Nine objectors challenged the fee award to no avail on appeal. California has no prohibition on “clear sailing” agreements (Consumer Privacy Cases, 175 Cal.App.4^th 545, 553 (2009)), and no evidence of fraud/collusion was present in the settlement process. Given that there were 80,000 class members, the fee amount was reasonable also.

#2: Roehrig v. Area 55, Inc., Case No. D066790 (4^th Dist., Div. 1 Apr. 29, 2016) (Unpublished).

     This decision is a rare one, where a plaintiff class representative was hit with attorney’s fees for prosecuting a false labeling wine aerator class action—claiming the aerator was not made in the U.S.A.—in bad faith, which can give rise to fee exposure under Civil Code section 1780(e) of the Consumer Legal Remedies Act. The appellate court first delineated that the “not in good faith” language of section 1780(e) encompasses a subjective test, not an objective speciousness test. (Corbett v. Hayward Dodge, Inc., 119 Cal.App.4^th 915, 922-924 (2004).) Now, we recite the facts which sealed the deal for plaintiff class representative: (a) plaintiff owned and purchased numerous consumer goods made in whole or in part outside the U.S., with no problem in making such purchases; (b) plaintiff talked to a friend about the aerator before he purchased it, failing to look at other aerators for “where made” information and seemingly did so in an attempt to “buy” a lawsuit to help the friend; (c) plaintiff tried to change deposition testimony to hide the involvement of his friend; and (d) plaintiff abandoned his claim—leading to an involuntary dismissal—because he failed to list it in his bankruptcy filings before even seeking class certification. Ouch!