1 Capitalized terms not otherwise defined in this Order shall have the same meaning as ascribed

to them in the Class Action Settlement Agreement in this action dated March 13, 2006.

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

In re CMS ENERGY ERISA LITIGATION

This Document Relates To: 

ALL ACTIONS 

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Master File No. 02-72834

Honorable George Caram Steeh

 Class Action

ORDER AND FINAL JUDGMENT1

And now this 27th day of June, 2006:

(a) Upon consideration of all documents filed in support of (i) Plaintiffs’ Motion for

Final Approval of ERISA Class Action Settlement Agreement (“Final Approval Motion”); (ii)

Plaintiffs’ Motion and Memorandum for Approval of Plan of Allocation (“Plan of Allocation

Motion”); and (iii) Class Counsel’s Motion for Attorneys’ Fees, Reimbursement of Expenses,

and Award of Compensation to Class Representatives (“Compensation Motion”) (collectively,

the "Motions"); as well as (iv) Certain Class Members’ Objections to Class Counsel’s Motion for

Award of Attorneys’ Fees, Reimbursement of Expenses, and Award of Compensation to Class

Representatives and to Certain Definitions Set Forth in the Plan of Allocation (“SPARE

Objection”) and (v) Plaintiffs’ Response To Certain Class Members’ Objections To Class

Counsels’ Motion For Attorneys; Fees, Reimbursement Of Expenses, And Award Of

Compensation To Class Representatives And To Certain Definitions Set Forth In The Plan Of

Allocation (“Plaintiffs’ Response to SPARE Objection”). 

(b) the Court having entered on March 23, 2006 an Order Granting Preliminary

Approval of Settlement, Approving Form and Method of Notice, and Setting a Date and Time

for Fairness Hearing (“Preliminary Approval Order”); 

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(c) the Court having received declarations attesting to the mailing of the Notice of

Class Action Settlement and the publication of the Court-Ordered Legal Notice (Summary) and

the Compensation Motion in accordance with the Preliminary Approval Order; and the Court

having been advised that US Trust, the Independent Fiduciary retained by the Company to

approve the Settlement on behalf of the Plan, has given its approval to the Settlement; and 

(d) a hearing having been held before this Court on June 15, 2006 (the “Final

Approval Hearing”) (i) to determine whether to grant the Final Approval Motion; (ii) to

determine whether to grant the Plan of Allocation Motion; (iii) to determine whether to grant the

Compensation Motion; and (iv) to rule upon such other matters as the Court might deem

appropriate, 

IT IS HEREBY ORDERED, ADJUDGED AND DECREED AS FOLLOWS:

1. The Court has jurisdiction over the subject matter of this action, all members of

the Settlement Class, and all Defendants pursuant to 29 U.S.C. § 1132(e).

2. In accordance with Federal Rule of Civil Procedure 23 and the requirements of

due process, the Settlement Class has been given proper and adequate notice of: the Settlement

Agreement, the Fairness Hearing, the Compensation Motion; and the Plan of Allocation Motion,

such notice having been carried out in accordance with the Preliminary Approval Order. The

notice, summary notice and notice methodology implemented pursuant to the Settlement

Agreement and the Court’s Preliminary Approval Order (a) constituted the best practicable

notice; (b) constituted notice that was reasonably calculated, under the circumstances, to apprise

members of the Settlement Class of the pendency of the litigation, their right to object to the

Settlement, and their right to appear at the Fairness Hearing; (c) were reasonable and constituted

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due, adequate and sufficient notice to all persons entitled to notice; and (d) met all applicable

requirements of the Federal Rules of Civil Procedure, and any other applicable law. 

3. The Settlement Agreement in this action warrants final approval pursuant to

Federal Rule of Civil Procedure 23(e)(1)(A) and (C) because it is fair, adequate, and reasonable

to those it affects and in the public interest based upon (a) the likelihood of success on the merits

weighed against the amount and form of relief offered in the Settlement; (b) the risks, expense,

and delay of further litigation; (c) the judgment of experienced counsel who have competently

evaluated the strength of their proofs; (d) the amount of discovery completed and the character

of the evidence uncovered; (e) the fairness of the Settlement to the unnamed class members; (f)

the lack of objections raised by class members and the independent fiduciary identified in the

Settlement Agreement; (g) the fact that the Settlement is the product of arm’s length negotiations

as opposed to collusive bargaining; and (h) the fact that this Settlement is consistent with the

public interest. In re Cardizem CD Antitrust Litig., 218 F.R.D. 508, 522 (E.D. Mich. 2003)

(citing Granada Invs., Inc. v. DWG Corp., 962 F.2d 1203, 1205 (6th Cir. 1992); Williams v.

Vukovich, 720 F.2d 909 (6th Cir. 1983)). 

4. The Final Approval Motion hereby is GRANTED, and the Settlement hereby is

APPROVED as fair, reasonable, adequate, and in the public interest and the terms of the

Settlement are hereby determined to be fair, reasonable and adequate, for the exclusive benefit of

participants and beneficiaries of the Plan in compliance with ERISA. The Parties are directed to

consummate the Settlement in accordance with the terms of the Settlement Agreement.

5. The Allocation Motion hereby is GRANTED, and the Amended Plan of

Allocation attached hereto as Exhibit A hereby is APPROVED as fair, adequate, and reasonable. 

In re Cardizem CD Antitrust Litig., 218 F.R.D. at 529. Class Counsel and the Settlement

Administrator or its designee are directed to administer the Distribution Amount in accordance

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therewith, and to distribute the Net Proceeds to all eligible members of the Settlement Class

(who include current and former Plan participants and their beneficiaries, but exclude the

individual named defendants in this action) in accordance with the Settlement Agreement and

the Amended Plan of Allocation, and to do so without the necessity of obtaining further order of

the Court. In this regard, pursuant to the terms of the Settlement Agreement, Class Counsel are

expressly authorized to pay the costs of implementing the Plan of Allocation from the Settlement

Fund without the necessity of obtaining further order of the Court, notwithstanding that this

Order has not yet become Final as that term is defined in the Settlement Agreement. 

6. Based on the work performed by Class Counsel and the results achieved, the

Compensation Motion hereby is GRANTED. Having reviewed the record, and the evidence

presented in support of the Compensation Motion, including, but not limited to, the declarations

of Class Counsel, the Court finds that Class Counsel adequately represented the Settlement Class

for purposes of entering into and implementing the Settlement Agreement. The Settlement was

negotiated at arm’s length by experienced counsel who were fully informed of the facts and

circumstances, and strengths and weaknesses of their respective positions. The Settlement was

not reached until after the Court had resolved Defendants’ motions to dismiss and granted Class

certification, and the parties had engaged in extensive document and deposition discovery, and

trial preparation, as well as extensive negotiations directly and with the assistance of

professional mediators. Class Counsel and counsel for Defendants, thus, were well-positioned to

evaluate the benefits of the Settlement, taking into account the expense, risk, and uncertainty of

protracted litigation over numerous questions of fact and law.

7. Class Counsel’s requested fee award of 28.5% is reasonable when evaluated in

light of (a) the value of the benefit rendered to the Plaintiff Class; (b) the value of the services on

an hourly basis; (c) the fact that the services were undertaken on a contingent fee basis; (d)

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society’s stake in rewarding attorneys who produce such benefits in order to maintain an

incentive to others; (e) the complexity of the litigation; and (f) the professional skill and standing

of counsel involved on both sides. Bowling v. Pfizer, Inc., 102 F.3d 777, 779 (6th Cir. 1996).

8. Having reviewed the SPARE Objection and Plaintiffs’ response thereto, and

heard argument by counsel on their respective positions, the Court find that SPARE has failed to

present facts sufficient to show that the attorneys’ fees, expenses, and Class Representative

Compensation sought in the Compensation Motion are unreasonable or in any way improper. In

order to avoid the expense and delay of further litigation over the SPARE Objection, Class

Counsel have agreed to reduce their request for reimbursement of expenses by $128,000 in

exchange for which the SPARE Objection is withdrawn, and SPARE by and through its counsel

of record expressly relinquishes its right to appeal the resolution of the SPARE Objection.

9. Accordingly, Class Counsel are hereby awarded attorneys’ fees in the amount of

28.5% of the cash Settlement Fund ($28 million, plus interest earned on the Settlement Fund),

which the Court finds to be reasonable under the circumstances of this case. Class Counsel are

further awarded the sum of $424,268.35 as reimbursement of costs and expenses, which the

Court finds were reasonably incurred for the benefit of the Class in prosecuting the Class’s

claims and in obtaining the Settlement, including expenses incurred in connection with experts

and consultants, travel and other litigation-related expenses. The awarded attorneys’ fees and

costs and expenses are to be paid out of the Settlement Fund to Class Counsel fifteen (15) days

after the Effective Date. The awards of attorneys’ fees, costs and expenses shall be allocated

among Class Counsel as such counsel mutually agree for their respective contributions in the

prosecution of the Action.

10. Class Counsel’s request for Class Representative Compensation in the amount of

$15,000 each is fair and reasonable in light of the Class Representatives’ substantial contribution

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to the litigation on behalf of the Class, including providing information to Class Counsel,

reviewing and approving pleadings, assisting with discovery, preparing for and attending their

depositions, and participating in settlement discussions. Accordingly, the Named

Plaintiffs/Class Representatives, Roger Schilling, Karen Potter and Danny Jordan hereby are

awarded $15,000 each, payable from the Settlement Fund fifteen (15) days after the Effective

Date as that term is defined in the Settlement Agreement.

11. Jurisdiction is hereby retained over this Action and the Parties, the Plan, and the

Settlement Class Members for all matters relating to the Action, including (without limitation)

the administration, interpretation, effectuation or enforcement of the Settlement Agreement and

this Final Order and Judgment, and including any application for fees and expenses incurred in

connection with administering and distributing the Settlement proceeds to the members of the

Settlement Class.

12. Without further order of the Court, the parties may agree to reasonable extensions

of time to carry out any of the provisions of the Settlement Agreement.

13. As provided in the Settlement Agreement, the following Definitions are hereby

adopted for purposes of this Order and Final Judgment:

a. “Affiliate” shall mean: any entity which owns or controls, is owned or

controlled by, or is under common ownership or control with, a Person. For purposes of

this definition, “control” shall mean the possession, directly or indirectly, of the power to

direct or cause the direction of the management and policies of such Person, whether

through the ownership of voting securities or otherwise.

b. “Company” shall mean: CMS Energy Corporation, a Michigan corporation,

each of its Affiliates, and includes any and all predecessors or Successors-In-Interest,

local, regional, national, and/or executive offices, divisions, or affiliates (foreign and

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domestic), segments, or divisions thereof, any of its subsidiaries, divisions or affiliates,

including, but not limited to Consumers Energy Company and CMS Energy Resource

Management Company, formerly known as CMS Marketing, Services and Trading

Company, and all of their present and former officers, directors, employees, agents,

directors, attorneys, accountants, advisors, and other persons acting or purporting to act

on their behalf.

c. “Defendants” shall mean: the Company and the following Persons named as

defendants in the Complaint: Kathleen R. Flaherty; Victor J. Fryling; Earl D. Holton;

William Parfet; Kenneth L. Way; Kenneth Whipple; John B. Yasinsky; John M. Deutch;

James J. Duderstadt; Preston D. Hopper; David W. Joos; William T. McCormick, Jr.;

Tamela W. Pallas; Percy A. Pierre; Alan M. Wright; Legal Representative of the Estate

of Thomas McNish; and Laura L. Mountcastle.

d. “Person” shall mean: an individual, partnership, corporation, governmental

entity or any other form of entity or organization.

e. “Successors-In-Interest” shall mean: a Person’s estate, legal representatives,

heirs, successors or assigns, including successors or assigns that result from corporate

mergers or structural changes.

14. Released Claims. Subject to paragraph 17 below, pursuant to the Settlement

Agreement, Plaintiffs (on behalf of each member of the Settlement Class) and the Plan shall

release any and all claims of any nature whatsoever (including claims for any and all losses,

damages, unjust enrichment, attorneys’ fees, disgorgement of fees, litigation costs, injunction,

declaration, contribution, indemnification or any other type or nature of legal or equitable relief),

against any of the Defendants, their current or former subsidiaries and affiliates, and the current

or former officers, directors, employees, insurers, plan fiduciaries or agents of any Defendant,

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whether accrued or not, whether already acquired or acquired in the future, whether known,

unknown, suspected or unsuspected, in law or equity, as well as any claim or right obtained by

assignment, brought by way of demand, complaint, cross-claim, counterclaim, third party claim

or otherwise (collectively, “Claims”), arising out of or in any way related to, directly or

indirectly, any or all of the acts, omissions, facts, matters, transactions or occurrences during the

Class Period: (i) that are, were or could have been alleged, asserted, or set forth in the

Complaint, including, but not limited to claims that: (a) Defendants breached ERISA fiduciary

duties to Plaintiffs in connection with the acquisition and holding of Company stock by the Plan

or the Plaintiffs, (b) the Director Defendants failed to appoint and/or adequately monitor Plan

fiduciaries with respect to Company stock, (c) the Defendants failed to provide complete and

accurate information to plan fiduciaries or participants and beneficiaries of the Plan regarding

the Company or Company stock, (d) Defendants each or any one of them caused the Plan to pay

more than adequate consideration for Company stock for the Plan, (e) the Defendants violated

any ERISA duties related to the acquisition, disposition, or retention of Company stock by the

Plan; (ii) against the applicable fiduciary liability Insurance Policy, AEGIS Policy No.

F0136A1A01; (iii) that would be barred by principles of res judicata had the claims asserted in

the Complaint been fully litigated and resulted in a final judgment or order; (iv) that pertain to

any decision made by any of the Parties to enter into or approve this Settlement Agreement; or

(v) that pertain to any conduct related to the direction to calculate, the calculation of, and/or the

allocation of the Class Settlement Amount to the Plan or any participant or beneficiary of the

Plan pursuant to the Plan of Allocation. Except for the obligations arising under the Settlement

Agreement, Plaintiffs shall expressly and completely waive and release any and all rights or

benefits which they have or may have under Section 1542 of the California Civil Code and any

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similar provision in any other jurisdiction, pertaining to the matters set forth in this Action. 

Section 1542 provides as follows: 

A general release does not extend to claims which the creditor

does not know or suspect to exist in his or her favor at the time of

executing the release, which if known by him or her must have

materially affected his or her settlement with the debtor.

In connection with such waiver and relinquishment, Plaintiffs shall acknowledge that they are

aware that they have or may hereafter discover claims presently unknown or unsuspected, or

facts in addition to or different from those which now are known or believed to be true, with

respect to the matters set forth in the Action. Nevertheless, it shall be the intention of Plaintiffs,

through the Settlement Agreement, and with the advice of counsel, to fully, finally and forever to

settle and release all such matters. In furtherance of such intention, the releases herein given by

Plaintiffs shall be and remain in effect as full and complete releases of the matters set forth in the

Action, notwithstanding the discovery or existence of any such additional or different claims or

facts relative hereto.

15. Releases of Named Plaintiffs, the Settlement Class and Class Counsel. Effective

upon the Effective Date, the Defendants shall absolutely and unconditionally release and forever

discharge the Named Plaintiffs, the Settlement Class, and Class Counsel and their

Representatives (collectively, the “Plaintiff Releasees”), from any and all Claims relating to the

institution or prosecution of the Action or the settlement of any Released Claim.

16. Reciprocal Releases among the Defendants. Effective upon the Effective Date,

each Defendant shall absolutely and unconditionally release and forever discharge each and

every other Defendant from any and all Claims in this litigation relating to the Released Claims,

including any and all Claims for contribution or indemnification for such Claims. 

Notwithstanding the foregoing, nothing in this paragraph affects the respective rights of the

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Company and other Defendants relative to one another under the Company’s current corporate

authority and relevant provisions of the Michigan Business Corporation Act with respect to

reimbursement and advancement of an individual Defendant’s legal fees and expenses by the

Company.

17. Scope of Releases. The releases set forth in paragraphs 13, 14, and 15 of this

Final Order and Judgment (the “Releases”) shall not include the release of any rights or duties

arising out of this Settlement Agreement, including the express warranties and covenants in this

Settlement Agreement.

18. Persons and Claims Not Released. Nothing in the Settlement Agreement shall

release, bar, waive, or otherwise affect any Claim that has been asserted in Securities Actions (In

re CMS Energy Corp. Securities Litigation, Master File No. 02-CV-72004-DT, United States

District Court for the Eastern District of Michigan and any and all cases now or in the future

consolidated therewith) or any defense thereto, and Defendants, the Plan, and Named Plaintiffs

shall reserve all rights with respect to positions they may take on that question in that action.

19. Upon this Order becoming Final, all counts asserted in the Second Amended

Consolidated Complaint will be dismissed with prejudice without further order of the Court

pursuant to the terms of the Settlement. In addition, the Named Plaintiffs and the Settlement

Class and the Plan shall be deemed to have, and by operation of this Final Order and Judgment

shall have, fully, finally, and forever released and are forever barred from the prosecution of, any

and all Released Claims. In the event that the Settlement Agreement is terminated in accordance

with its terms, however: (a) this Judgment shall be null and void and shall be vacated nunc pro

tunc, and (b) this action shall proceed as provided in the Settlement Agreement.

20. There is no just reason for delay in the entry of this Final Order and Judgment and

immediate entry by the Clerk of the Court is expressly directed.

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IT IS SO ORDERED, ADJUDGED AND DECREED.

s/George Caram Steeh 

GEORGE CARAM STEEH

UNITED STATES DISTRICT JUDGE

Dated: June 27, 2006

CERTIFICATE OF SERVICE

Copies of this Order were served on the attorneys of record on June 27,

2006, by electronic and/or ordinary mail.

s/Marcia Beauchemin 

Case Manager/Deputy Clerk

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