Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-00530/USCOURTS-azd-2_10-cv-00530-0/pdf.json

Nature of Suit Code: 450
Nature of Suit: Interstate Commerce
Cause of Action: 15:0053 Federal Trade Commission Act

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

IN RE LIFELOCK, INC., MARKETING

AND SALES PRACTICES LITIGATION

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MDL Docket No. 08-1977-PHX-MHM

PRELIMINARY APPROVAL ORDER

Currently pending before the Court are the Parties’ Joint Motion for Preliminary

Approval of Class Action Settlement, Approval of Class Notice, and Conditional

Certification of a Settlement Class, (Dkt.#146), and Joint Motion to Transfer Fed. Trade

Comm’n v. LifeLock, Inc., CV-10-0530-PHX-NVW to this Court. (Dkt.#141). 

With respect to the Parties’ Joint Motion to Transfer, IT IS HEREBY ORDERED

granting the Motion on the grounds that the FTC Action is related to multidistrict litigation

case styled as In re LifeLock, Inc., MDL Docket No. 08-01977-PHX-MHM. (Dkt.#141.)

These two actions are inextricably related on the following bases: (1) they arise out of a

similar series of transactions and events, (2) they involve common questions of law and fact,

and (3) transfer of these cases to the same judge will avoid unnecessary costs and prevent

substantial duplication of labor.

Case 2:10-cv-00530-MHM Document 17 Filed 04/16/10 Page 1 of 8
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With respect to the Parties’ Joint Motion for Preliminary Approval of Class Action

Settlement, Approval of Class Notice, and Conditional Certification of a Settlement Class,

IT IS HEREBY ORDERED granting the Motion as follows. (Dkt.#146).

The PARTIES, acting through their counsel, subject to Court approval following

notice to the SETTLEMENT CLASS and a hearing, have agreed to settle the matters

consolidated in these proceedings, as set forth in the settlement agreement attached hereto

as Exhibit A (the "AGREEMENT"). The PARTIES' unopposed Joint Motion for Preliminary

Approval of Class Action Settlement, Approval of Class Notice, and Conditional

Certification of a Settlement Class (the "Motion") was presented on April 12, 2010, before

this Court. Having considered the papers and the arguments of counsel, the Court orders the

following:

1. All of the definitions contained in the AGREEMENT shall apply to this Order

and are incorporated by reference as if fully set forth herein.

2. The Motion is GRANTED. The AGREEMENT is preliminarily approved by

the Court as fair, adequate, reasonable, and in the best interests of the putative class

members. The Court hereby conditionally certifies for settlement purposes only and for no

other purposes, the following Class:

SETTLEMENT CLASS: All persons in the United States who are current or past

subscribers of LIFELOCK's identity theft protection services. Excluded from the Class are

employees, officers and directors of LIFELOCK; any judge or employee of any court

assigned to work on the MDL PROCEEDINGS, the RELATED STATE COURT ACTIONS

and the UNDERLYING ACTIONS; and PLAINTIFFS' and LIFELOCK's attorneys and staff.

3. The Court conditionally and preliminarily finds that this action satisfies the

requirements for class action approval under Federal Rule of Civil Procedure ("Rule") 23(a)

and (b)(2). In support of this ruling, and for purposes of this Rule 23(b)(2) settlement, the

Court conditionally and preliminarily finds that the class is so numerous that joinder of all

members is impracticable, there are questions of law or fact common to the class; the claims

or defenses of the representative parties are typical of the claims or defenses of the class; and

Case 2:10-cv-00530-MHM Document 17 Filed 04/16/10 Page 2 of 8
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the representative parties will fairly and adequately protect the interests of the class. The

Court further conditionally and preliminarily finds that LIFELOCK has acted on grounds that

apply generally to the class so that final injunctive relief is appropriate respecting the

SETTLEMENT CLASS as a whole.

4. The Court approves and appoints as Plaintiffs' CLASS COUNSEL the

following:

Robert B. Carey

Leonard W. Aragon

Hagens Berman Sobol Shapiro LLP

11 W. Jefferson St., Ste 1000 

Phoenix, AZ 85003 

5. The Court approves and appoints as class representatives Plaintiffs Melvyn

Blake, Alva Blake, Franco Vega, Byrl Lane, and Jason Sbalcio.

6. The PARTIES have agreed to provide individual notice to all CLASS

MEMBERS by electronic or first class mail, as well as publication notice via a dedicated

Internet settlement website and a hyperlink that will reside on LIFELOCK's website home

page. The PARTIES have also agreed that CLASS MEMBERS may exclude themselves

from the settlement. The Court acknowledges that a Rule 23(b)(2) class may be certified on

a mandatory basis, i.e., without the right to opt out, and without receipt of notice of the

settlement. Here, the AGREEMENT provides for notice and opt-out rights and thus ensures

ample protection of CLASS MEMBERS' due process rights. Indeed, the Court finds that the

proposed notice plan is the appropriate and the best practicable notice under the

circumstances and adequately informs the CLASS MEMBERS regarding the terms of the

proposed settlement. See, e.g., Rodriguez v. West Pub. Corp., 563 F.3d 948, 962 (9th Cir.

2009) ("Notice is satisfactory if it 'generally describes the terms of the settlement in sufficient

detail to alert those with adverse viewpoints to investigate and to come forward and be

heard.'") (quoting Churchill Vill., LLC v. Gen. Elec., 361 F.3d 566, 575 (9th Cir. 2004) and

Mendoza v. Tucson Sch. Dist. No. 1, 623 F.2d 1338, 1352 (9th Cir. 1980)). The Court

further finds that the time period provided in the AGREEMENT for CLASS MEMBERS to

object or request exclusion - eight (8) weeks after notice is initially provided - is sufficient

Case 2:10-cv-00530-MHM Document 17 Filed 04/16/10 Page 3 of 8
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and complies with the requirements of due process. Torrisi v. Tucson Elec. Power Co., 8

F.3d 1370, 1375 (9th Cir. 1993) (settlement providing for twenty-six (26) days to opt-out

adequate; settlement providing for thirty-one (31) days to object adequate). Accordingly, the

Court hereby directs that notice be given in the form and manner proposed in the

AGREEMENT, as set forth below.

7. The Court further finds that the settlement recited in the AGREEMENT falls

within the range of settlements qualified for judicial approval and warrants the dissemination

of notice to CLASS MEMBERS. The Court's finding is based upon its analysis of the

relevant facts presented in the PARTIES' joint motion and considered the six factors

expressly enunciated by the Ninth Circuit as relevant to the fairness determination at the

preliminary approval stage: (1) the strength of plaintiffs' case; (2) the risk, expense,

complexity, and likely duration of further litigation; (3) the risk of maintaining class action

status throughout the trial; (4) the consideration offered in settlement; (5) the extent of

discovery completed, and the stage of the proceedings; and (6) the experience and views of

counsel. Molski v. Gleich, 318 F.3d 937, 953 (9th Cir. 2003).

a. The strength of plaintiffs' case. The Court has pending before it

LIFELOCK'S Motion for Judgment on the Pleadings and PLAINTIFFS' Motion Regarding

Choice of Law. Based on these motions, and all other pleadings before it, the Court notes

that nothing suggests that PLAINTIFFS' claims are either so weak or so strong as to preclude

the proposed settlement. The two pending motions independently have the potential to

significantly impact the ultimate resolution on the merits, and thus the Court concludes that

this factor strongly favors granting preliminary approval of the proposed settlement.

b. The risk, expense, complexity, and likely duration of further litigation;

the risk of maintaining class action status throughout the trial, the extent of discovery

completed, and the stage of the proceedings The Court finds that the following facts satisfy

the second, third and fifth fairness factors. This litigation has proceeded in the MDL

PROCEEDING and RELATED STATE COURT ACTIONS for more than two years with

significant efforts and expenses by the PARTIES. Depositions of many of the named

Case 2:10-cv-00530-MHM Document 17 Filed 04/16/10 Page 4 of 8
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plaintiffs have been completed and extensive discovery has been exchanged on an informal

basis. Dispositive motions have been filed and fully briefed and are under consideration by

this Court. There is no doubt that further litigation would be expensive, complex, time

consuming and that this Court and multiple state courts would be required to resolve difficult

and complicated issues of state and federal law relevant to both the propriety of class

certification as well as ultimate liability and damages issues. The mature status of these

cases, the anticipated cost of continued litigation, and the uncertainty regarding their ultimate

outcome strongly favors preliminary approval. 

c. The consideration offered in settlement. The Court finds that the fourth

factor is met because of the substantial injunctive relief provided under the AGREEMENT

that benefits past, present and future LIFELOCK subscribers, which included LifeLock's

assurances that it would discontinue certain practices that had been challenged by

PLAINTIFFS. The AGREEMENT also specifically preserves CLASS MEMBERS' right to

participate in the $11 million FTC consumer-redress program, as well as the right to opt out

of the settlement and seek further recovery from LIFELOCK on an individual basis. Thus,

the consideration to be provided under the AGREEMENT also favors preliminary approval.

d. The experience and views of counsel. Finally, regarding the sixth

factor, the Court finds that settlement was reached through extensive and rigorous

arms-length negotiations between the PARTIES and was not a product of collusion. Multiple

written demands and offers were exchanged and rejected by the PARTIES and numerous

meetings were convened among counsel before a final resolution was achieved. The

proposed settlement was achieved only after, and as a result of, the settlement between

LIFELOCK, the FTC, and the various States' Attorneys General. Plaintiffs' cases were, at

least in part, a precipitating factor in the FTC settlement. The agreed-upon settlement terms

are fair and reasonable and not a product of collusion.

8. All costs in connection with the identification of CLASS MEMBERS,

dissemination of the class notice, and administration of this settlement shall be paid by

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LIFELOCK, as set forth in the AGREEMENT. The Court hereby approves Rust Consulting,

Inc. as SETTLEMENT ADMINISTRATOR. 

9. The SETTLEMENT ADMINISTRATOR shall within fourteen (14) days

following entry of this Order cause to be sent a notice of the settlement to each member of

the SETTLEMENT CLASS by electronic mail to his or her last known e-mail address as

reflected in LIFELOCK's member records. The notice shall be in the form of Attachment

A to the AGREEMENT. The SETTLEMENT ADMINISTRATOR shall cause to be sent the

same notice, in the form of Attachment B to the AGREEMENT, within the same time period

by postcard via first class mail to any member whose e-mail address is not reflected in

LIFELOCK's records. In the event that any e-mail notice is returned as undeliverable, the

SETTLEMENT ADMINISTRATOR will send the same notice within five days of such

return by postcard via first class mail to the last known address reflected in LIFELOCK's

records. Addresses for the sending of notice by first class mail shall be updated by the

SETTLEMENT ADMINISTRATOR through the National Change of Address Database

maintained by the United States Postal Service prior to mailing. 

10. Within fourteen (14) days of entry of this Order, the SETTLEMENT

ADMINISTRATOR shall cause to be active a settlement website at

www.lifelocksettlement.com. The website will remain active through the EFFECTIVE

DATE. The settlement website shall contain, link to, and provide for download of each of

the following: (a) the Case Description and Questions substantially in the form of

Attachment C to the AGREEMENT; (b) a final and fully executed copy of this

AGREEMENT; (c) the Court's Order granting preliminary approval of this AGREEMENT

and conditional certification of the SETTLEMENT CLASS described herein; and (d) a final

and fully executed copy of the AGREEMENT with the FTC. LIFELOCK will include on

its official website at www.lifelock.com a link to the settlement website. The

SETTLEMENT ADMINISTRATOR shall update the settlement website as becomes

necessary to reflect current information regarding the status of the settlement. The e-mail

and first class mail notice described in paragraph 8, above, shall provide the URL of the

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settlement website and shall also provide directions for persons to obtain the information on

and contents of the settlement website by mail or email.

11. Any member of the SETTLEMENT CLASS who wants to object to the

settlement shall file with the COURT and serve on CLASS COUNSEL and LIFELOCK's

COUNSEL any objections to the settlement within seventy (70) days of entry of this Order.

12. Any member of the SETTLEMENT CLASS who wants to be excluded from

the SETTLEMENT CLASS shall submit a written request for exclusion that is postmarked

within seventy (70) days of entry of this Order. The request shall also be mailed by first class

mail to CLASS COUNSEL and LIFELOCK's COUNSEL. Any such request for exclusion

shall set forth the following information to be effective: (a) the person's name and address;

(b) a statement that such person is a member of the SETTLEMENT CLASS; and (c) a

statement that such person is requesting exclusion from the SETTLEMENT CLASS.

CLASS COUNSEL shall file with the COURT all requests for exclusion not less than ten

(10) calendar days prior to the date of the final approval hearing.

13. Any member of the SETTLEMENT CLASS who does not make his or her

objection known in the manner provided in this Order shall be deemed to have waived such

objection and shall forever be foreclosed from making any objection to the fairness or

adequacy of the proposed SETTLEMENT.

14. Any lawyer intending to appear at the hearing on final approval of the

AGREEMENT, other than attorneys already in the case or attorneys for a state or federal

entity, must be authorized to represent a member of the SETTLEMENT CLASS, must be

duly admitted to practice law before the United States District Court for the District of

Arizona or admitted pro hac vice to appear in that court, and must file an appearance no later

than twenty (20) calendar days prior to the final fairness hearing. 

15. The hearing on final approval of the AGREEMENT is hereby set for August

10, 2010 at 1:30 P.M before the Honorable Mary H. Murguia in the United States District

Court for the District of Arizona. The hearing on Plaintiffs' motion for attorneys' fees and

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costs also will be heard on that day. Papers for these motions shall be filed and served within

ten (10) calendar days prior to the date of the final approval hearing. 

DATED this 15th day of April, 2010.

Case 2:10-cv-00530-MHM Document 17 Filed 04/16/10 Page 8 of 8