mantra is the court american alan isaacson counsel for object repellant sarah mcdonald i'd like to reserve five minutes for a bottle if i may and i'm going to be sharing my argument with david hawks who is counsel for object repellent  of the reasoned response to all non frivolous objections that is required by this court's precedents i'm going to be focusing on issues related to standing to the rule twenty three age requirement that the  application and fim ocean be available before the time for objections is run and attorneys fee and cafe coupon issues so that it doesn't get lost i would like to begin with a point that's come up in several of the arguments already this morning which goes to caf is requirement that attorneys fees in a coupon settlement case be based on the value of coupons that are reading and doesn't say will be redeemed or might be redeemed it says that our reading and i think there's been a feeling with some members of the panel that it can't mean what it says well i don't know whether that's i mean if you're taking more of my questions or to suggest that that's what it was nobody get side of me that language before maybe you want to maybe you want to suggest to me then they if you want to start there why is it that i can determine that just like you do in every other case as to what is redeemed or what will be redeemed or what is or can be why have i got to put that off until the end why can't i do it like i would any kind of damages case where the damages or if you will to come but i measure them as of today and i give them to somebody well one of the problems is going to be difficulty of estimating or guesstimating what redemption rates are going to be they vary have we have those same difficulties in every damage they vary widely and i would not want to defend an expert reporting incident bear bear analysis on points like that i think it makes more sense to construe the statute as written and it's not a requirement that you delay the plaintiff's lawyers getting fees intil some day long in the future a company like kohl's has very sophisticated accounting systems they've got to account for coupons they give they've got to account for gift cards and redemptions of coupons and gift cards it's got to go in there  reports for credit for pick for goodness sake they know it will know when the gift cards are being used and being redeemed but if they don't expire and the fact that they don't expire is being argued as an important distinction makes them not coupons then you'll never know when it's done they can be sitting in there in your drawer forever if they sit in the drawer for ever because people don't really value them the lawyers shouldn't get paid for that know on a monthly basis or on a quarterly basis how many are being used if they're really valuable and people run right out to the store and seven spend them right away they'll be millions of dollars in redemptions in the first month or the first quarter and kohl's can cut the check  on the value of the coupons that are redeemed and it's not i mean it's it's not extremely unusual for layers to get paid over a period of time i was a partner for twenty six years at a couple of big class action firms milberg weiss and then coghlan which is now robbins geller back in the days of milk had a big quick tobacco class actions that settlement the attorneys fees were set up in a way that they get paid over a period of twenty five or thirty years every three months i get a check for six thousand dollars and tell the time has run we are talking about companies like kohls with big coupon settlements or gift card settlements that could be structured in a way that coles knows how they are how long it takes from the when they're being redeemed and can cut the attorney's fees checks at that time it honors the statutory tax it gives class council an incentive to make sure that whatever in relief they get is going to be valuable and will be used so it creates the right incentives for cafe as well i'd like to point out that with respect to the timing of the class notice alan versus says that you need to have a really notice of the entire class you're talking about notice under twenty three you're concerned about the ability of a large number of class members to come in and respond that's what pretend you represent i represent sarah mcdonald and so mcdonald comes toward this comes into this particular situation and gets additional time to brief the attorney for the issue right she was the one person who got it didn't understand that nobody else said anything about it why have they not waived i don't think it's true that nobody else said anything about i want to do you want to have just a minute what do we have in the record which would suggest that anybody else objected what we've got mr hock's objection for and you've got the fact that a class members don't know what the basis of the fia ward is going to be especially make a where you've got a coupon settlement it gets very complicated then it doesn't make sense to say that they've waived it they didn't get the notice it was necessary to make a meaningful objection but put it seems to me that you premise your prejudice argument entirely on the bridges other members of the class who don't file objections have either to the scheduling order the attorneys fees and i just kept reading about this and i said but mcdonald has has none of that all your your whole argument as to what those people who didn't say anything about it you're on it the class is prejudiced if the notice doesn't go out and any individual minute the class is prejudice but if the class doesn't even care they don't even give let suggest he's a he's an exception all of your arguments are about a class who did nothing did not file objections either to the scheduling or to the attorney's fees and you filed the objection and you got additional time well  a ten page brief and mr hawkes didn't have notice of that it was in the civil minutes and nobody in the class knew that they had that opportunity besides my client it's not fair to the class and it's not fair to my client because somebody like mr hawks can come in and have all kinds and we're going again we're going on mr hawke's let mr arcs talk about this what did what prejudice to you have you had it all you had all of notice and you had extra time i'm prejudiced as in any yes or no is that the bottom line i don't see any prejudice to mcdonald at all that i i think that rule twenty three h will become a knowledge and that anybody who comes in and makes an objection will be deemed to have had notice and if they're given some extra time fine nobody else can object and will twenty three any other argument and i ask you about your standing argument i'm quite confused about why you're saying the plaintiffs don't have standing that don't have an injuries to support standing because that would seem to suggest neither does your client and then it would seem to suggest there's no reason for you to be worried about this case and i'm just  may not even be members of the class with respect to russell the district court well that's a different point let's assume they are members of the class the class as defined has standing if your client does right the class as defined may have standing if it has standing yes i think i mean the the allegations of the complaint are sufficient there is not however evidence sufficient for rule twenty three stage classer to vacation and settlement approval to find by preponderance of the evidence that those folks had standing the court found that russell's claim does not fall within the class definition that's a supplemental excerpt of record for thirty two because i say the client caffie is done but doesn't matter because they're only looking for injunctive relief it doesn't matter that she got a refund while the class is defined as defined as people who did not get a refund so it looks looking at the record like no other caffeine or russell is a member of the class and you don't have article three standing to represent a class you're not a member of i am running into my colleagues time your honor i need thank you sit down good morning and may please the court david hawkes on the half of an appellant bobbie c c oh i'd like to address two basic but very very important issues first the district court erred when it completely ignored and otherwise failed to address my client's timely objection which raised a very serious concerns about this settlement and second the district court also erred when it failed to engage in the requisite heightened scrutiny and analysis one of the you waiting in approving this settlement the fia ward and also in certifying the settlement class the district courts failure to satisfy these procedural safeguards and protections which are mandated by this court effectively precludes this court go ahead and gauging in any meaningful appellate review and also fails to protect the rights of absent class members who are giving up their rights as our demise or it's my standard or a view as to the approving of the settlement it's abuse of discretion clear abuse what difference what is clear abuse i mean i mean usually i just have abuse and i have clear abuse what's the difference i'm not quite sure what the legal difference is you're i'll read then i'm a little worried about how you would attack this then because if i'm looking into standard or review for a settlement and i'm saying is this an abuse of discretion that's one standard if i'm looking at a clear abuse one's got i make a higher showing and my worry is that you haven't made a higher showing because the final order there's no question did not conduct an individualized analysis of various factors however the factors were addressed at various stages of the proceedings and at various hearings and so i'm trying to figure out why on a clear abuse of discretion this wasn't sufficient to support the conclusion in the final order approving the settlement two things your honor one that when the when the order is not supported by sufficient findings just minutes of his findings all i'm trying to do is i gave you what you had you said it was an individualized analysis i understand that but then i looked at all the other stages of the proceedings and what the court did in those stages and there were those factors were grassed of those proceedings with respect to the earlier certification decisions and at various here other hearings and the analysis then i said why isn't that sufficient under clear abuse of discretion but your honor when the order is not supported by sufficient findings it's not entitled to the same deference and i think there's a difference between clear abuse of discretion when you comply with procedural safeguards of this court versus when you don't well all i all i'm trying to get you to do is focus on the fact that when i'm looking for a clear abuse of discretion i'm just going to just look at the final order i'm going to look at all of the things the district court did to get to the end result and so therefore i go to various stages of proceedings and i look at what the district court does there and i'm trying to suggest whether they did way it ought to be done with the individualized analysis of the factors and upon based on they had they did how can that be a clear abuse of discretion i would question whether the court actually did engage in a meaningful analysis of annalyn factors and i don't believe that it's very well i thought it was interesting because as i read what you get brief to me it seemed to me that you didn't go to any other stages of the proceedings and look what happened i did indeed your honor in fact i looked back at the class certification opinion where the court found that these these plaintiffs were not members of the class they argued if you had the opportunity if you'd had notice of the fees and the opportunity because it seems like you're saying we have this in right mercury error but you haven't really said what you would have said if you'd had the right notice and the right opportunity i think that the fees should have been based on the value of the gift cards and that needs to be decreased and there's certain precedent out there here in the ninth circuit that says that they're valued at eighty five percent of the value and then also valued based on how many of those gift cards are actually used as opposed to the total so if we disagree with that and we think that these are coupons and start not coupon this is a we don't agree with you on that th would there be any harm from the n r a mercury air i think there would be because i think that's a procedural safeguard that we don't want to let district courts know that they're free to disregard any time they don't think they need to comply we don't want to set a precedent where there are certain circumstances where district courts don't need to comply with the procedural safeguards announced by this court to protect absent class members and to allow this court to engage in meaningful appellate review so what should happen to fix the in re mercury problem i think that the court needs to send the case back to the district court there needs to be another notice provided and in fact my client never received notice despite being a member of the yes loyalty program they had her physical address they had her e mail address and yet somehow she never received direct notice she put this into a objection plaintiff's counsel never addressed it and the court below never addressed it and anything in my client's objection they completely ignored it and again that's another procedural safeguard the district court ignored and so i think there's a clear error by not satisfying the procedural safeguards designed to protect absent class members like my coupons and cafes and so i'd like to address at first but i really think that the most important issue here from my perspective is the twenty three h issue because i believe that the record below adequately supports the courts of terminations that the settlement here was fair adequate and reasonable as your honor mentioned if we look at the entirety of the record in the proceedings below there were motions to dismiss as there was a motion for certification there was a motion for reconsideration another ruling on the motion for reconsideration for certification  they sent out they had e mail addresses which they mailed out postcards publication notice fact we had so why didn't you submit something that is just a court saying look here's our administrators or they can show that they sent an e mail to c c i mean i'd feel a lot better if there had been some response but it was seems like it was totally ignored in my right eye i don't believe that i could have access that information within that short period of time for c c l personally and i didn't and i you know i did not or administrator submitted declarations of their notice efforts and they detail them and we received over three hundred fifty south fifty seven thousand claims from class  members we also reference them to a website so we did the best notice practicable under the circumstances and what do you see as arguments about the fees and how they seem unrealistic the things over the holidays it couldn't really have been spent no response to that so what happened there why weren't there responses to c c s objections to how the fees were claimed i'm confused by the court's question well maybe because you didn't address it so c s brief to us and in the district court since he was making arguments about that couldn't really have been these fees spent on discovery the billing shows the time over christmas they couldn't really have worked that i mean maybe the answer is you really did work then but you didn't respond  course we did we responded with a supplemental declaration in support of the female version of the hours that we spent on the case and it was before the court and he considered it i were unfortunately almost every day of the year and sometimes i'm christmas i don't know if i worked on christmas at any on a particular year my office is a mile from my house so it's easier has a whole brief about this to us or a part of the brief and i don't see a response this perhaps i didn't think it was i crucial to the case your honor perhaps because i think that there's clear evidence in the record to support our fee request first of all the fee request was based on a percentage of the recovery and it had a across jacka lodestar cross check when we went to the hearing there were object there were there had been objections filed as you can see from the from the docket it's part of the record when we went to the you know on the timing there was the attorney for the motion was filed august fifteenth the objection deadline was a week before so a month  attorney for the motion was filed we had the hearing on september twelfth at the hearing counsel for mcdonald was present and argued all the various subjects does that satisfy the the problem under mercury that the rest of the class did not have notice that's a separate issue and i i would say that mercury did not analyze harmless error in that case and i think for a good reason because the facts before mercury that were that the attorney for the motion was filed one week before the hearing and there were no efforts to cure that problem when when i went to the hearing on september twelfth i requested klausner that we continue the hearing for three weeks and we give the objectors an opportunity to submit supplemental briefing which which he did i mean they had two additional opportunities to file objections but they that the members of the class have their own right to file objections i understand that they have been selected these objectors to represent them and they haven't received notice in terms of the motion itself they've got the original settlement agreement that gives parameters and so maybe there's a harmless error analysis here but if the cases don't read that way well i would i would say this under twenty three h one that's the section that requires the class be notified of the fee application and that's that's what we did in the class and notice we told them that we're seeking twenty five percent of the common find as attorneys fees and costs so there's little dispute that that was to interrupt you for meetings i don't understand why that's accurate and twenty three eight says a claim for an award must be made by motion and notice of the motion must be served on all parties and for motions by class directed to class members in a reasonable manner how did that ever happen when did that happen that the section says that under one its notice of the motion must be served which is what we did with the class notice under subsection two it's the class member has an opportunity to object to the motion i agreed and therefore mercury has interpreted that to mean although of some other circuit that the class members are entitled to review the motion for some period of time prior to the hearing now the objectors had an opportunity now the question is i guess twofold one did the class or was it sufficiently cured was two was it harmless and i'd like to address both quickly in terms of cure which i think is maybe separate from harmless here  i'm not sure whether he received them or not so i think that's the c e o is saying to us that that happened and i don't didn't see a response from you about that either i'm just i think i may have misspoken earlier when i said objections in the district court because i think they probably didn't because they didn't have the opportunity and they say that in that notice but they're making them now which i think maybe goes to the harmlessness question like if they had gotten notice maybe they would have made all of these arguments that exist on pages twenty five to the end of their brief that you ignored here and it gives us not much to go on to show why it's harmless that those things should have been addressed in the district court i would say this if you look at the supplemental  page six fifty four on august ten twenty sixteen she she oh filed an objection to the class so it's in the record so he must have had notice i understand he says he didn't have notice but he must have he was subject is that before or after the fees application it was five days before the few right so how does he have know what's in the field location and whether it's reasonable h two problem but i'm addressing first his contention that he never had notice well but i think what he said is he didn't have notice of the case and even though he was objector or the things that happened after like when mcdonald got a chance to brief it i think is saying i didn't have that chance well i believe he did i mean all the class members were directed to first of all they have a they they know what the the case is the case number pacer they've been directed to the website by the notice they're fully aware of what's going on in the case and he filed an objection now the issue is i think they all the people who filed objections in early august were aware of when the final hearing wise it's in their objections they know the final hearing is on september twelfth and they know and they know the website they know the they can go on to pacer because they filed things already and if they check they bothered to check with pace r they would have seen the court's minute order which specifically told them that they could file supplemental briefs and objection to the attorney for the motion they were provided an additional three weeks ok also in my supplemental attorney for the motion i advised that you're saying all everyone was given the additional three weeks as i read the transcript it was just mcdonald has given three weeks well the court did say object or instead of object doors but or anyone else in the class who wants to come along well the court's wording is the court's wording all i can all i can say is i you can read the minutes order and i uploaded all the relevant documents immediately on to the website so the attorney for the motion was on the website the court's minute order and supplemental briefing was on the website so i guess that that would be the no i found the allegation it's in six of their opening brief they say the russell plan of did not serve objector c c l with the attorneys of his motion and i didn't see any response about that in your brief to make a lot of allegations that are troubling that were not responded to by you in your brief and i don't know how what we're supposed to do about whether you waive those responses and so we assume that what they're saying is true i mean you're now telling us they're not true but we're in a bit of a bad spot with well the most the motion is filed online and it was filed five days after she filed this objection anything anything else i would just say that going back to an issue about clear abuse of discretion i think the record is sufficient to support the judge's approval of the settlement is fair adequate and reasonable specially  look at what happened with the child and cases the court heard earlier today and the problems with restitution and proving damages in this case we have six million one hundred fifty thousand dollars a common fund and the same exact exact plaintiffs caffie and russell submitted declarations detailing that they were in fact members of the class because they bought items within the class definition of a discount of thirty percent or more off and that they wouldn't have spent the money absent the alleged false advertising so i think that's done in terms of whether this is a gift card or a coupon i think we satisfy the requirements for gift cards under in re d v d the only distinction that can be made is that the settlement does not offer cash in addition to the gift card there is no requirement in cafe that cash has to be offered if a gift card is off i really could get cast for the gift cards couldn't say that's absolutely correct your honor under civil code section seven hundred forty nine point five hundred kill for your law that's correct so i don't think there's any issue with the gift card the fee if the court decides not to approve the attorneys fees i don't think that should upset the rest of the settlement supplemental excerpt of record one sixty and one seventy nine that's the settlement agreement it makes clear that failure to approve attorneys fees quote shall not be a basis for rendering the entire agreement no void and there was a separate attorney's fees order that the court can deal with without disturbing the entire rest of affected i'm just trying to figure out the logistics of how we could deal with the fees without dealing with the settlement is the money going to come from well if if the plaintiff's lawyers want to collect their attorneys fees and it gets sent back down to just class and says you have to redo the notice they're going to have to figure out how to redo the notice out of the amount that would be that is going to come from out of the amount that we contractually agreed to yes that's right but won't be any lessening  attorney fees end up going to the members of the class they absolutely that's absolutely correct and so what that means is that if that happens the final distribution of of the gift cards or the final amount of the gift cards will that determination will have to wait until after that process is gone through so they are inextricably linked unless you're going to issue one gift card and then another gift card there linked in that the gift card amount might increase if the attorneys fees are decreased but the overall fairness and equity of the settlement should not be affected although we have a weird thing that could it become that they wouldn't then be eligible for cash because then it becomes more valuable than ten dollars if it becomes more valuable than ten dollars then i would then i would argue that there's no requirement in calf or in d v d that a gift card must be accompanied by cash and what you'd be saying otherwise is that every settlement has to be at least partly a cash settlement and i don't think that's what caff says and i don't think that's what in re d v d s all right thank you for your argument i'm not going to give everybody one more time you went over but i'll give the first unless you wanted to exchange between yeah i'll give you a minute appreciate it bobbie check e o was pro se when she appeared below she's so she was not getting anything by you see af with respect to special whose fault is that i guess i'm not i mean she could have signed up for the c f anyway maybe or or what how does that work my understanding is that if you're not a member of the bar they don't let you sign up for e c s filings i don't know i don't know i think made it very from one district court to another i don't know if that's the case in another district court i think that's the case in the southern district of new york i can't tell you what it is in this district as i think about it i think that it's very like online d v d or more like this balancing all these multiple factors you know the congressional intent was clear that if you're getting a valid sure or something other than cash it's a coupon and online d v d ought to be limited to cases where as an on line d v d they could get twelve dollars cash or if they'd rather a twelve dollar gift card that they could take to wal mart because that would be a easier for some people right thank you very very large