2009 D e c i sion s O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit

9-8-2009 

# In Re: Ins ur ance
P r e c e de nt i al or N on-P r e c e de nt i al : P r e c e de nt i al D ocke t N o . 07-3687

F o llow thi s and a dd it ion al work s at : http://d i git alc ommon s .l a w . vi ll anova . e du/thir dc ir c uit_2009

Thi s de c i sion i s br ou ght t o you for f r e e and ope n a c c e s s b y the O p inion s of the U nit e d S t at e s C our t of Appe al s for the Thir d C ir c uit at V i ll anova U nive r sity S choo l of L a

w Di git al Reposit ory

. It h as be e n a c c ept e d for inclusion in 2009 D e c i sion s b y an author i z e d a dmini s tr at or of V i ll anova U nive r sity S choo l of L a

w Di git al Reposit ory

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" In Re: In s ur anc e " (2009). 2009 D e cisio n s . P ape r 552. http://d i git alc ommon s .l a

w . vi ll anova . e du/thir dc ir c uit_2009/552P RE CE DE NT I AL
UN I TED STATES CO UR T OF A PP EALS F O R T H E T H IR D C IR C U IT

N os . 07- 1759, 07- 1763, 07- 1769, 07- 1779, 07- 1786, 07- 1793, 07- 1796, 07- 1826, 07- 2935, 07- 2957, 07- 3037, 07- 3038, 07- 3039, 07- 3040, 07- 3041, 07- 3042, and 07- 3687

I N R E : I NS UR ANC E BR OKE RA GE A N T I T R U ST L I T I G A T I O N ( M D L N o. 1663)
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f ma n Le g a l Gr o u p , LL C, L acyR edd and C ross & S i r, O bject ors, A ppel l ant s , N o. 07- 1759

R o m ero G en era l C o n stru cti o n C o rpo rati o n , O b jector, A ppel l ant , N o. 07- 1763

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P alom ar G rad ing an d P av ing , Inc

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H aro ld F o lsom Jen sen , O b jector, A ppel l ant , N o. 07- 1826

V an E n terprises, I n c., O b jector, A ppel l ant , N o. 07- 2935

C l as s M ember s I aad O I nc. , T rus t ee of 8 P a c i f i c S t r e e tTru s ta n d Zo r k e s s LL C, A ppel l ant s , N o. 07- 2957

Shapi r o & L odw i ck C o. L PA , and S p o rt s & S p in e P h y s ic a l T h e ra p y , In c ., A ppel l ant s , N o. 07- 30373 L ac yR ed d an d C ross & S ir , A ppel l ant s , N o. 07- 3038

I r e n e P e k o e a n d Ho f

f ma n Le g a l Gr o u p , LL C, A ppel l ant s , N o. 07- 3039

R o m e ro G e n e ra l C o n s tru c tio n C o rp ., A ppel l ant , N o. 07- 3040

E m e ra ld F in a n c ia l G ro u p , In c ., P a lo m a r G ra d in g a n d P a v in g , In c ., and H ar ol d Fol s om J ens en, A ppel l ant s , N o. 07- 3041

D a n C .D . S tu rd e v a n t, A ppel l ant , N o. 07- 3042

V a n E n te rp ri s e s , In c ., A ppel l ant , N o. 07- 3687

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OPI NI ON O F THE COURT11 F IS H E R , C i r cui tJudge

. A ti ssue i n thi s consoli dated app eal are the st and ards a d i s t r i c tc o u r ta p p l i e s w h e n d e c i d i n g w h e t h e rt o c e rt i f y a s et t l ement

- onl ycl as s , appr ove a c l as s sett l ement , and appr ove c l a s s c o u n s e l ’ s p e t i t i o n f o ra t t o r n e ys ’ f

e e s . M o r e s p e c i f

i c a l l y, w e a re p rese n ted w ith ch all en g es to the D istri ct C o u rt ’s ord ers gr ant i ng fi nal appr oval of a $121, 8 0 0 , 0 0 0 s et t l ementand a $28, 000, 000 s et t l ement , as w el l as t o t he D i s t r i ctC our t ’ s or der appr oving an aw ar d of $29, 500, 000 forat t orney s ’ fee s and exp enses i n co njunct i on w i t h the l argerof the t w o set t l em ents

. A ppel l ant s ar e mem ber s of the s et t l ement cl as s i n one orboth of t he s et t l ement s w ho obj ect ed t o var i ous as pect s of t he s et t l ement agr eement s pr i ort o t he D i s t r i ct C our t gr ant i ng fi nal appr oval of t hos e agr eement s . A ppel l ees ar e t he sett l i ng par t i es , cons i s t i ng o f t h e p l a i n t i f

f s , s e t t l i n g d e f

e n d a n t s , a n d i n t e r v e n o ra t t o r n e ys gener al i n one s et t l ement , an d the pl ai nt i ffs and s et t l i ng defe ndant s i n t he others ett l ement

. B eca use w e concl ude that th e c las s c e rtific a tio n re q u ire m e n ts o f F e d e ra l R u le o f

C iv il P ro c e d u re 2 3 (a ) a n d (b ) w e re sa tisf ied w ith re sp e c t to b o th s et t l ementcl as s es and thatboth s et t l ement s w er e fa i runder Federa l R u l e of Ci vi l Pr ocedur e 23( e) , w e w i l l aff i r m the D istric t C o u rt’s o rd e rs g ra n tin g f in a l a p p ro v a l o f

b o th s et t l ement s . W e w i l l al s o aff i r m the D i s t r i ct C o u r t ’ s or der gr ant i ng at t or ney s ’ fee s beca us e w e conc l ude thatt he D i str ic t C our tact ed w i t hi n i t s di s cr et i on i n aw ar di ng a r eas onabl e fe e.
I . Backg r ound
T he or i gi ns of t hi s cas e dat e back t o O ct ober 2004 w hen th e N e w Y o rk S tate A tto rn e y G e n e ra l, E lio t S p itze r, f iled a c iv ilJ udge Fai t h S. H ochber g i ni t i al l ypr es i ded overt he 1 co n so li d ated ca ses; h o w ev er, C h ief Jud g e G arrett E

. B row n , Jr. re p lac e d h e r o n Ja n u a ry3 , 2 0 0 7 , d u e to h e r re c u sa l. 12 compl ai ntagai ns tt he i ns ur an ce b r okerM ar s h & M cLennan ( M a r s h ) i n New Y o r k s t a t e c o u r t , a l l e g i n g th a tM a r s h h ad s ol i ci t ed fi xed bi ds fr om i ns ur anc e compani es and had then recei ved i m proper pay m ents for di rect i ng cust om ers t o th o se compani es . I n N ovember2004, a mul t i

- s t at e gr oup cons i s t i ng of tw el v e at t or ney s gener al and s ever al s t at e i ns ur ance depart m ent s began i nves t i g ati n g t he al l eged bi d r i ggi ng and s t e e r i n g a c t i v i t i e s o f b r o k e r s a n d i n s u r e r s i n t h e p r o p e r t yand cas ual ty insur ance i ndus t r y . Pr i vat e part i es comm ence d num er ous put at i ve cl as s act i ons i n fede r al cour t s acr os s t he c o u n trya s w e ll.
O n February17, 2005, t he Judi ci al Panel on M ul t i di s t r i ct L iti g a tio n c o n so lid a ted th e se p riv a te c iv il ac tio n s f ro m m u lti p le j ur i s di ct i ons und er 2 8 U

. S. C

. § 1407 and tr ans ferr ed the ca s es t o t he U ni t ed St at es D i s t r i ctC our tfort he D i s t r i ctof N ew J er s ey for pretri al proceed i ng s. I n r e I ns
. B r oker age Ant i tr us tLi t ig. , 1 360 F. Supp. 2d 1371 ( J

. P. M

. L

. 2005)

. T he pl ai nt i ffs cl ai m ed a vas tcons pi r acybetw een s om e of the nat i on’ s l ar ges ti ns ur ance br oker s ( t he B r okerD efe ndant s ) and i n sur ance carr i er s ( t he I ns ur erD efe ndant s ) i nvol vi ng bi d r i ggi ng and al l ocat i ng or s t eer i ng cus t om er s t o defe atcompet i t i on i n t he i ns ur ance m arket i n excha nge forhi gh br oker age c om m i s s i ons . T he D i s t r i ct C our t i ni t i al l y s ever ed t he var i ous act i ons and r eal ign ed them i nt o t wo c o n s o l i d a t e d docket s – one cons ol i dat ed ca s e pert ai ni ng t o pr oper t yand ca s ual tycomm er ci al i ns ur ance ( t he C om m er ci al13 C as e) and the othercons ol i dat ed ca s e pert aini ng t o empl oy ee b e n e f its in s u ra n c e (t h e E m p lo y e e B e n e f its C a s e ). See In re Ins. B r oker age Ant i tr us tLi t ig. , 20 06 W L 2 8 5 06 07 , at*2 (D

. N

. J. O ct. 3 , 2 0 0 6 ).
T he pl ai nt i ffs i n t he C o m m er ci al C as e ar e a pr opos ed cl as s of bus i nes s es , i n d ivi dual s , and publ i c ent i t i es w ho, betw een A ugus t26, 1994 and Sept ember 1, 2005, engage d t he s ervi ces of the B r oker D efe ndant s t o obt ai n advi ce w i t h r es pect t o t he pr ocur em en t orr enew al of comm er ci al pr oper t yand cas ual tyi ns ur ance and ent er ed i nt o orr enew ed an i ns ur ance pol i cyw i t h t he I ns ur erD ef endant s . T he pl ai nt i ffs i n the E m pl oy ee Benefi t s C as e ar e both empl o y ers w ho ut i l i zed the s ervi ces of the B r okerD efe ndant s t o o b ta i n gr oup i ns ur ance cover age f

r om t he I ns ur erD efe ndant s fort hei rempl oy ees as par tof thei rempl oy ee be nefi t s pl ans and empl oy ees w ho o b tain e d in su ra n c e f

ro m th e In su re r D e f

e n d a n ts th ro u g h th e ir em ploy ers ’ benefit s pl ans.
I n A ugus t 2005, t he pl ai nt i ffs fi l ed sepa r at e cons ol i dat ed amended compl ai nt s in t he C om m er ci al C as e and i n t he E m ploy ee B enef

i t s C ase. T he plai nti ffs i n the C om m erci al C ase a lleg e d th a t “[ t]h e B ro k e r D e f e n d a n ts a n d In su re r D e f e n d a n ts eng ag ed i n a combi nat i on and cons pi r acyt o s uppr es s and el i m i nat e compet i t i on i n the s al e of i ns ur ance bycoor di n ati ng and r i ggi ng bi ds fori ns ur ance pol i ci es , al l ocat i ng i ns ur ance m arket s and cus t om er s and r ai s i ng, m aint ai ni ng ors t abi l i zi ng p re m ium pri ces abo ve co m peti t i ve level s. ” (C orr ect ed F i rs t C ons ol i dat ed A m . C om m er ci al C l as s A ct i on C om pl

. ¶ 1. ) T he pl ai nt i ffs i n t he Em pl oy ee Benefi t s cas e al l eged thatthe B r oker D e f e n d a n ts a n d In su re r D e f e n d a n tsA d di t i onal l y , t he empl oy ee- pl ai nt i ffs i n t he Em pl oy ee 2 B enef i t s C as e as s er t ed cl ai m s agai ns tt he I ns ur erD efe ndant s for b r e a c h o f f

i d u c i a r yd u tyu n d e rth e Em p l o y e e Re t i r e me n tI n c o me S e c u r i t yAc t of 19 74 ( ERI S A) , S e c t i o n 5 0 2 ( a ) ( 2 ) , 2 9 U. S

. C. § 1 1 3 2 (a)(2). 14 “have consp ir ed t o m ani pul at e the i ns ur ance m ar ket t hr ough u n d i s cl os ed pr ofi t

- s har i ng ag ree m en ts an d k ickb ac k s in an ef fo rt to ca p ture l arge rm arkets har es and pr ofi t s t o the detr i m ent of t hei r unw i t t i ng cl i ent s and i ns ur eds

. A l t hough t he B roker D efen dan t s ar e hir ed to fi nd the b est i ns ur ance cover age at t he l ow es tpr i ce, t he I ns ur er D e fe n d a n ts p a y th e B roker D e fe n d a n ts undi s cl os ed or i nadequa t el ydi s cl os ed C ont i ngent C om m i s sions , C om m uni cat i on Fees , and other c o m p e n sa tio n so th a t th e B ro k e r D e f e n d a n ts w ill s te e r t h e irc lie n ts to th e m .” (C orr e ct ed F i rs tC on sol i dated A m . E m ploy ee B enef i t s C l ass A c tio n C o m p l. ¶ 1 .)
T h e pl ai nt i ffs i n bot h the C om m er ci al C as e and the E m pl oy ee Benefi t s C as e br oughtcl ai m s agai ns tthe B r okerand I n s u r e rDe f

e n d a n t s f

o rv i o l a t i ng t h e S h e r ma n Ac t , 1 5 U. S

. C. § 1, t he R acke t eerI nfl uence d and C orrup t O r gani zat i ons A ct ( R I C O ) , 1 8 U

. S

. C

. § 1 9 6 2 ( c )

- ( d ) , th e a n t i t r u s tl a w s o f f o r t yei ght s t at es and t he D i s t r i ct of C ol um bi a, and s t at e comm on l aw d u ti es (i. e., u n

just en ri ch m en t and b rea ch o f f idu ciaryd u ty ). 2 T h e p l a i n t i f

f s i n b o t h c a s e s s o u g h tr e s t i tu t i o n , c o m p e n s a t o r y,15 puni t i ve and tr ebl e damages , di s gor gement , i nj unct i v e and declar at oryrel i ef, and at t orney s’ fees and cost s. A ft er the p l ai nti ffs fi l ed their fi rs tam end ed co m plai nts , th e d e f e n d a n ts f

iled m o tio n s to d ism iss th e f e d e ra l cla im s in b o th ca ses pu rsua n t to Fe d era l R u le o f C ivil P roc ed u re 1 2 (b)(6 ), ar gui ng t hatt he fa ct s al l eged i n t he compl ai nt s w er e i ns uffi ci ent t o s t at e a caus e of a ct i on fora Sherm an A ctorR I C O vi ol at i on. A lm o st a y ea r l ater, o n O ctob er 3 , 2 0 0 6 , the D istri ct C o u rt gr ant ed the def

endant s ’ m ot i ons t o di s m i s s for fai l ur e t o s t at e a c a u se o f a c tio n a s to th e S h e rm a n A c t an d R IC O c laim s, b u t d id s o w it h o u tpr ej udi ce a nd gave l eave t o the pl ai nt i ffs t o amend th e ir p le a d in g s . I

n r e I ns
. B r oker age Ant i tr us tLi t ig. , 2 0 0 6 WL 2850607 ( D

. N

. J

. O ct

. 3, 200 6 ). Subse quent l y , the pl ai nt i ffs fi l ed a s uppl ement al s t at ementof part i cul ar i t yi n eac h cas e for t hei rfede r al ant i t rus tcl ai m s and an amended cas e s t at ementfor th e ir R I C O c la im s. T h e d e f e n d a n ts re n e w e d th e ir m o tio n s to di s m i s s t h e s e c l a i ms p u r s u a n tt o Rul e 1 2 ( b ) ( 6 )

. On Apr i l 5, 20 07 , t he D i stri ctC ou rton c e a gain grant ed the defen dan t s’ m ot i ons t o di s m i s s t hes e cl ai m s , w i t hout pr ej udi ce, and gave the p la in tif f s le a v e to a m e n d th e irp le a d in g s . I n r e I ns
. B r oker age A nt i tr us tLi t ig. , 2007 W L 1062980 ( D

. N

. J

. A pr . 5, 2007)

. N ot l ong t her eaf

t er , t he pl ai nti ffs fi l ed a Sec ond A m ended C o m p lain t in th e C o m m e rc ial C a se a n d E m p lo y e e B e n e f its C ase, and t he defe nd ants again r enew ed thei r m oti on s t o d i sm i ss t he fede r al cl ai m s . O n A ugus t31, 2007 and Sept ember28, 2007, t he D i s t r i ct C our t di s m i s s ed t he S herm an A ctcl ai m s and R IC O c laim s in b o th c a s e s o n R u le 1 2 (b )(6 ) g ro u n d s a n d , this tim e , d id s o w ith p re

ju d ic e . I n r e I ns
. B r oker age Ant i tr us tLi t ig. , 2 0 0 7 W L 2 5 3 3 9 8 9 (D .N .J. A u g . 3 1 , 2 0 0 7 ); I n r e I ns
. B r oker age A nt i tr us tLi t ig. , 2 0 0 7 W L 2 8 9 2 7 0 0 (D

. N

. J. S ep t. 2 8 , 2 0 0 7 ).T h e Z u ri ch D ef en d an ts are a g rou p o f in su rers 3 compri s ed of Zur i ch Fi nanci al Ser vi ces , Z u ri ch A m er i can I ns ur ance C om pa n y , St e a dfas tI ns ur ance C om pany , Fi del i t yand D ep o s i tComp a n yo f

M a r y l a n d , Emp i r e Fi r e a n d M ar i ne In su ra n c e C o m p a n y , A m e r ic a n G u a ra n tee a n d L iab ili ty I ns ur ance C ompan y , Emp i r e I n d e mni tyI n s u r a n c e Comp a ny , and A s s ur ance C om panyof A m er i ca. 16 A . The Z ur i c h Se t t l e m e nt
I n A ugus t2005, t he Z ur i ch D efe ndant s w er e adde d t o the C om m er ci al C as e put at i ve cl as s act i on. A t t he s ame t i m e as t he 3 l i t i gat i on w as pr ocee di ng, t he Zuri ch D efe ndant s w er e al s o t he s u b j e c to f i n v e s t i g a t i o n s c o n d u c t e d b y v a r i o u s s t a t e a t t o r n e ys gener al and s t at e depa r t m ent s o f ins ur ance s t emm i ng fr om the s ame al l eged pr act i ces i n the mar ket i ng and s al e of c om m er ci al i ns ur ance . O n O ct ober14, 2005, t he Zuri ch D efe ndant s and the p lai n ti ff s en tered into a M e m o ra n d u m o f U n d e rs ta n d in g (M O U ), wh i c h s e tf

o r t h t h e p r i n c i p a l t e r ms o f a s e t t l e me n to f

t h e c l a i ms a g a i n s tt h e Z u r i c h De f e n d a n t s . S p e c i f

i c a l l y , t h e M OU es t abl i s hed thatanycl ai m s ar i s i ng outof tr ans act i ons w i t h the Z ur i ch D efe ndant s fr om A ugus t26, 1994 t hr ough Sept ember1, 2005 w oul d be r es ol ved byt he s ett l ementand that , i n r eturn, t he Z ur i ch D efe ndant s w oul d es t abl i s h a $100, 000, 000 s et t l ement fund fort he bene fi tof the Set t l em en t C la s s . T he Set t l ement C l as s i ncl uded
“al l indi vi dual s orent i t i es , w ho dur i ng t he Set t l ementC l as s Per i od, engage d t he servi ces of (i ) o n e of the B rok er D ef

en d an ts or an ysu b sidiary17 oraff i l i at e of a B r okerD efe ndanti n connec t i on w i t h a Set t l ementC l as s Pol i cy Pur chas e fr om any Z ur i ch I ns ur er , anyI nsu r erD efe ndantorany i ns ur ance companyt hati s notan af fi l i at e or s ubs i di aryof a Zur i ch I ns ur er , o r (ii ) anyother broker .

. . i n con necti on w i t h a S et t l em ent C l ass P o lic yP u rc h a s e f

ro m a n yZ u ri c h In s u re r.”
T h e M O U w a s s u b

je c t to th e c o m p letio n o f f u ll c o n f irm a to ryd isc o v e rya n d th e p lain tiff s re se rv e d th e rig h t to t erm inate the M O U if, fo ll o w ing co m p let ion o f th e c o n firm atory di s covery , t hey r eas onabl y and i n good fai t h di d notbel i eve the t erm s of the s et t l ementw er e fa i r , r eas onabl e, and adequat e. T he M O U w as al s o cont i ngentupon t he succ es s ful r es ol ut i on of the ongoi ng s t at e i nves t i gat i ons and t he s ucce s s ful negot i at i on and ex e c u t i o n o f

a s t i p u l a t i o n o f

s e t t l e me n tb e t wee n th e Zu r i ch D efen dan t s and the plai nti ffs.
O n M ar ch 20, 2006, t he Zuri ch D efe ndant s r eac hed an agr eement( M ul t i

- St at e A gr eement ) w i t h t en st at es – C al i forni a, Fl or i da, H aw ai i , M ar y l and, M as s achus et t s , O r egon, Penns y l vani a, T exas , V i r gi ni a, and W es t V i r gi ni a – w hi ch res olved t he in vest i gati on s of t he att orney s general i n those s t at es agai ns tt he Zuri ch D efe ndant s . A tthe sam e t i m e, the Z ur i ch D efe ndant s r eac hed a Regul at orySet t l ementA gr eement w i th fi ft een s t at e depa r t m ent s of i ns ur ance , w hi ch cont ai ned p ro v isio n s th a t m irro re d th o se c o n tain e d in th e M u lt i- S tate A gr eementand r es ol ved the i nves t i gat i ons o f the i ns ur ance depart m ent s i n t hos e var i ous s t at es againstt he Zuri chIt is u n c lea r f ro m th e re c o rd w h ich sta tes p a rticip a ted in 4 th e R e g u lato ryS e ttl e m e n t A g re e m e n t. T he val ue of priva t e cl as s act i on l aw s ui t s occurr i ng 5 concurr ent l yw i t h, orfol l ow i ng fr om , s t at e att orneygener al in v e s tig a tio n s h a s b e e n th e s u b je c t o f s c h o la rl yd e b a te

. See , e. g. , J ohn H

. B ei s ner , M at thew S h or s & J es s i ca D avi ds on M ille r, C la ss A c tio n “ C o p s” : P u b lic S e rv a n ts o r P riv a te E ntr eprene urs? , 5 7 St a n . L. Re v . 1441 ( 2 0 0 5 ) ; “ FTC W or ks hop, ” C l as s A ct i ons as an A l t er nat i ve t o R egulat i on: The U ni que C hal l enges P r es ent ed by M ul t i pl e Enf or cer s and Fo llo w -O n L a w su its , 1 8 G eo . J. L eg al E thics 1 3 1 1 (20 0 5 ). C r i t i cs of conc ur r entpr iva t e cl as s act i on l aw s ui t s and governm enti nves t i gat i ons , i n w hi ch pr i vat e l aw y er s and at t or ney s gener al w or k t ogether , cl ai m thatthe pr act i ce may t r a n s f o r m t h e o f

f i c e o f t h e a t t o r n e y g e n e r a l i n t o a m o n e ym aki ng appar atus w her e pr i vat e att orney s r ep ea te dl yt ake on p rojec ts w ith th e g o v e rn m e n t in o rd e r t o g a in a c c e ss to its i nves t i gat i ve fi ndi ngs and succ eed i n l ucr at i ve cl as s act i on l aw s ui t s . O n t he ot her hand, s uppor t er s of part ner s hi ps betw een at t or ney s gener al and pr i vat e cl as s act i on at t orney s ar gue that cl as s act i on s ui t s fi l l t he gaps r es ul t i ng fr om i ns uffi ci ent 18 D efe ndant s . U ndert he t erm s of the M ul t i

- St at e A gr eement , t he

4 Z ur i ch D efe ndant s agr eed t o pr ovi de $51, 700, 000 i n r es t i tut i on t o t he Set t l ement C l as s , w hi ch w oul d s uppl ementt he s et t l ement r el i ef t o be pr ovi ded purs uant t o anyfi nal s ett l ementagr eement r eac hed byt he par t i es and w oul d be di s t r i but ed t o the Set t l ement C l as s i n acc or dance w i t h the pl an of al l ocat i on s etfor t h i n s uch a se ttl e m e n t ag re e m e n t. 5governm ent r egul at i on and enfor cement , and hel p t o d eter in d u stryb a d b e h a v io r. P ro p o n e n ts also c laim th a t w o rk in g w ith at t or ney s gener al cr eat es a h i gherl evel of pol i t i cal a c c o u n tab ili tyf

o r p riv a te a tto rn e y s, a n d th a t th e p a rtn e rsh ip m ethod i s an ef

fi ci entm eans of s har i ng i nform at i on betw een the go vernm ent and t he p ri vate att orney s. 19 O n M arc h 2 7, 2006, t he Zuri ch D efe ndant s exec ut ed a s epar at e agr eementw i t h the att orney s gener al i n the s t at es of N ew Y o rk, C o n n ec ti cu t, an d Il li n o is ( T h ree -S tat e A g ree m en t) , w h ich re so lv e d th e in v e stig a tio n s a g a in st th e Z u ric h D e f e n d a n ts i n t hos e s t at es . T he Thre e- St at e A gr eementr equi r ed t he Zuri ch D e f e n d a n ts to e sta b lish a n $ 8 8 ,0 0 0 ,0 0 0 se ttl e m e n t f u n d to pr ovi de r el i ef t o a gr oup of pol i cyhol der s s peci fi ed i n the Thre eSt at e A gr eement

. A ny di s t r i but i ons m ade pur s uantt o t he Thre eSt at e A gr eementw er e t o be sepa r at e fr om t hos e made pur s uant t o any fi nal s et t l ement agr eementr eac hed bythe part i es and the M u lti -S tate A g re e m e n t.
O n Ju ly2 6 , 2 0 0 6 , fo llo w in g th e re so lu tio n o f th e sta te i nves t i gat i ons , t he Z ur i ch D efe ndant s ent er ed i nt o a St i pul at i on o f S ett l ementw ith the p lai n ti ff s (Z u ri ch S ett lem en t A g ree m en t)

. T he t erm s of t he Zuri ch Set t l ementA gr eementpr ovi ded thatt he Z u ri ch D ef

en d an ts w o u ld p ay$ 1 0 0 , 0 0 0 , 000 t o the pol icyh o lders w h o m e e t the d ef

init ion o f th e S ett lem en t C lass; ho w ev er, b ec au se som e of the po tential S ett lem en t C lass M em b ers w ere a lso e lig ib le to se e k re lief u n d e r th e s e p a ra te T h re e -S tate A gr eement , t he Zuri ch Set t l ementA gr eemental l ow ed the Z ur i ch D ef

en dant s t o i ni t i al l ycr eat e a f und i n the amountof $70, 100, 000 w hi l e des i gnat i ng t he r emai ni ng $29, 900, 000 forA s t he attorney s gener al expl ai n, “[m]os ti ns ur ance 6 cu stom ers s tr u c tu re the irinsu ran ce co v era g e in th ree ti ers[ :] a l evel of s el f- i ns ur ance , a l evel of pr i m aryi ns ur ance , and one or m ore l evels o f e x c ess i nsurance. T he clas s i ncludes tho se per s ons w ho bought t he pr i m ary and exce s s i ns ur ance fr om t he 20 pol i cyhol der s w ho qual i fy as Set t l ement C l as s M ember s butopt t o cl ai m r ei m bur s ementundert he Thre e-Stat e A gr eement i ns t ead of

t he Z ur i ch S et t l ement A gr eement

. O nl y i f the Zuri ch D efe ndant s fai l ed t o di s bur s e atl eas t$29, 900, 000 thr ough t he T h ree -S tat e A g ree m en t ( all o f w h ich w o u ld g o to p o li cy h o lders w ho w ere el i gi bl e forr el i ef unde rt he Zuri ch Sett l ement A gr eement ) w oul d t he Zu r i ch D efe ndant s be r equi r ed t o fund t he bal ance t o t he Sett l ementC l as s fu n d

. T hus , t he Zuri ch D efe ndant s w er e r equi r ed t o pay$70, 100, 000 undert he t erm s of t he Zuri ch Set t l ementA gr eementand $51, 700, 000 undert he t erm s o f t he M ul t i

- St at e A gr eementfora t ot al fund of $ 1 2 1 ,8 0 0 ,0 0 0 f

o r th e S e ttl e m e n t C las s M e m b e rs, w h ile $2 9, 90 0, 00 0 of t he am ou nt desi gn at ed for t he S et t l em ent C l ass in the M O U w o u ld b e u sed to f u n d the $ 8 8 , 0 0 0 , 0 0 0 aw ard e sta b lish e d b yth e T h re e -S tate A g re e m e n t.
U n d e r th e te rm s o f

th e Z u ric h S e ttl e m e n t A g re e m e n t, 5 1

. 7 % o f th e sett lem en t f u n d is a ll o tt ed to Z u ri ch p o li cy h o lders w h o p u rc h a se d e x c e ss c a su a ltyin su ra n c e d u rin g th e 2 0 0 1 to 2004 t i m e per i od, w hi l e Zuri ch pol i cyhol der s w ho pur chas ed otherl i nes of

com m erci a l in surance, or w ho pu rchased exce ss cas ual t y pol i ci es i n ot her t i m e per i ods , ar e al l ot t ed 33. 9% of the sett lem en t fu n d , an d tho se S ett lem en t C lass M em b ers w h o are notZ ur i ch pol i cyhol der s ar e al l ot t ed 9% of t he s ett l ementfund. 6d e f e n d a n t b ro k e rs .” A dd i t i on al l y , a t otal of 1, 06 7 p otent i al S et t l em ent C l ass 7 M embers fil ed t i m el yexcl us i ons , opt i ng outof the Zuri ch S e ttl e m e n t A g re e m e n t. 21 T he Zuri ch D efe ndant s al s o agr eed t o s epar at el ypayany admi ni s t r at i on and di s t r i but i on cos t s as s oci at ed w i t h t he Zuri ch S e ttl e m e n t A g re e m e n t.
O n N ovember8, 2006, the D i s t r i ctC our tent er eda n o r der p re lim in a rilyc e rtifyi n g th e S e ttl e m e n t C las s a n d p re lim in a r ily appr ovi ng t he pr opos ed Z u r i ch Sett l ementA gr eement

. T he D i s t r i ctC our ts etJ anuary11, 2007 as a dea dl i ne for fi l i ng any obj ect i ons t o t he Zuri ch Set t l ementA gr eementand s chedul ed a fai rness hear i ng forJ anuary26, 2007. Pur s uantt o t he D i s t r i ct C o u rt ’ s or der , an admi ni s t r at orm ai l ed not i ce of the pr opos ed set t l e mentt o o ve r 3, 79 0, 00 0 S et t l em ent C l ass M em bers and als o pu bli shed n oti ce of t he fai rness heari ng i n m ult i ple per i od i cal s, i ncl udi ng The N

ew Y ork Ti m es , The W

al lStr eet Jour nal , U

SA Today , B us i nes s I

ns ur ance M

agaz i ne , R is k M

anagem ent Ma g a zine , and the new s paperw i t h t he l ar ges tci r cul at i on i n eac h of the fi ftys tat es an d the D i s t r i ctof C ol um bi a. T he a d m in istra to r a lso e sta b lish e d a w e b site a n d to ll-fr e e n u m b e r to pr ovi de det ai l s of the pr opos ed s ett l ementand off eras s i s t ance t o the Sett l em ent C l ass M em bers.
A total of

fiftee n p o tential S ett lem en t C lass M em b e rs fi l ed t i m el yobj ecti o ns t o the pr opos ed Zuri ch Set t l ement A gr eement

. T he obj ect i ons per t ai ned t o t he s uffi ci encyof the

7T h e a tto rn e y s g e n e ra l w h o p a r ti c ip a te d in th e M u lti -S tate 8 A g ree m en t fil ed a m o ti o n to interv en e in th e li ti g ati o n in su p p o rt of the appr ov al o f t he Zuri ch Set t l ementA gr eement , and on Sept ember18, 2006, the D i s tr i ctC our tgr ant ed thi s m ot i on. 22 not i ce, s cope of

t he r el eas e and ba ror der , req ui r ement s for s ubm i t t ing c l ai m s form s , pr ocedur es forr eques t i ng excl us i on, P l a n o f Al l o c a t i o n , c l a s s c e r t i f i c a t i o n , a n d a t t o rn e y s ’ f e e s . At t he s chedul ed fa i r nes s hear i ng befor e the D i s t r i ctC our t , ei ghtof t he obj ect or s w er e r epr es ent ed bycouns el ; how ever , V an E nt erpr ises, I nc. ( V an Ent erpr i s es ) , one of the curr ent ap p ell an ts, w as n o t am o n g th e o bjectors w h o ap p ea red b ef o re t he D i s t r i ct C our t , des pi t e havi ng fi l ed a N ot i ce of A ppear ance . I n addi t i on t o C l as s C ouns el , t he Z ur i ch D efe ndant s , and ei ght of the obj ect or s , a r epr es ent at i ve fr om t he O ffi ce of the A t t orney G ener al of T exas appea r ed atthe fa i r nes s hear i ng on behal f of th e in ter v e n in g a tto rn e y s g e n e ra l. 8
O n February16, 2 0 0 7 , the D i s t r i ctC our ti s s ued an op i nion gr anti ng t he Z uri ch D efen dan t s’ and t he plai nti ffs’ m o tio n f o r f in a l ap p ro v a l o f

th e se ttl e m e n t an d d ism iss in g , w ith p re ju d ic e , th e Z u ri c h D e f

e n d a n ts f ro m th e litig a tio n . In re I ns. B r oker age A nt i tr ust Lit ig. , 2007 W L 542227 ( D

. N

. J

. Feb. 16, 2 0 0 7 ) (Z u ri ch S ett lem en t Fina l A p p rov al O p inion ). In e x p lain in g its d e c isio n to g ra n t f in a l ap p ro v a l o f

th e se ttl e m e n t, t he D i s t r i ctC our t chos e nott o s um m ar i ze e ach of t he i ndi vi dual chal l enges r ai s ed byt he obj ect or s , buti tdi d di s cus s the gene r al cat egor i es of obj ect i ons t hatw er e r ai s ed and di s m i s s ed each of t hes e types of obj ect i on. A ft er r ej ect i ng al l of the obj ect i ons , t he D i s t r i ct C our t cert i fi ed t he Sett l ementC l as s , fi ndi ng t hati tm etT h e p lain tiff s a sk e d th e D istric t C o u rt to c o n sid e r o n ly 9
w h e th e r th e p ro p o se d c la s s m e t th e sta n d a rd s s e t f o rth in R u le 23( b) ( 3) and nott o cons i derw hetherR ul e 23(b)(2) w as s at i s fi ed. W hen thes e i ndi vi dual amount s ar e added t ogether , the 10 total is onl y$29, 910, 000 and thus i s $40, 000 s hor tof the re q u e ste d f

e e o f $ 2 9 ,9 5 0 ,0 0 0 . T h e p a rties d o n o t ad d re ss th is d i s c r e p a n c y. 23 al l of the r equi r ement s of R ul e 23( a) and ( b) ( 3) , and appr oved 9 t he Z uri ch S et t l em ent A greem ent, fi nd i ng t hat al l of the fai rness re q u ire m e n ts o f

R u le 2 3 (e ) w e re m e t.
A ddi t ion all y , t he Zuri ch D efe ndant s agr eed w i t h the plai nti ffs t o payup t o $ 29 , 95 0, 00 0 fo r att orney s’ fees, exp ense rei m bu rs em ents , and i ncen t i ve aw ards for the n am ed p l ai nti ffs, w hi ch w oul d not be subtr act ed fr om t he Set t l ementC l as s fund. T he pa r t i e s a l s o a gr e e d tha ti f the D i s t r i c tCour tgr a nt e d l e ss t han the r eques t ed fee s and expe ns es ori f thi s amount w as l at er reduced , t he Z uri ch D e f e n d a nts – n ot the S et t l em ent C l ass M em bers – w ou l d b e enti t l ed to t he d i fference in am ou nt. C l ass C o u n se l f

iled a m o tio n f

o r a n a w a rd o f

f e e s in th e D istric t C o u rt, r eques t i ng t hatt he D i s t r i ctC our tdi s t r i but e the $29, 950, 000 as foll ow s: “$3 , 95 7, 00 0 fo r r ei m bu rs em ent of l i t i gati on exp enses; $1 50 , 00 0 fo r paym ent of i ncen t i ve aw ards t o fift een P l ai nti ffs; and $25, 803, 000 forat t orne y s fee s i ncurr ed i n t he pr os ecut i on of thi s l i t i gat i on. ” V ar i o u s S ett l ementC l as s M ember s fi l ed 10 obj ect i ons i n oppos i t i on t o t he mot i on foran aw ar d of fe es . T he obj ect i on s chal l eng ed the value of b enef i t s to Sett l em ent C l ass24 M ember s cr eat ed byC l as s C ouns el i n l i ghtof the i nvol vement of the att o rney s gener al , the i ncl us i on of t i m e s penton nonZ u ri ch S ett lem en t m att ers in the ca lculati o n o f th e lod estar, C l as s C ouns el ’ s per form ance of t hei rgat ekee perfunct i on, and t he over al l amount of the fe es . O n J un e 5, 2007, the D i s t r i ct C our tappr oved the r eque ste d fee aw ar d, r ej ect i ng al l of the o b je c tio n s . I

n r e I ns
. B roker age Ant i tr us tLi t ig. , 2 0 0 7 WL 16 52 30 3 (D

. N

. J. June 5 , 20 07 ) ( Z uri c h S et t l em ent A t t orney s’ F ee s O p inion ).
T he fo ll ow i ng obj ect or s fi l ed t i m el ynot i ces of appe al from th e D i stri ctC ou rt ’s order grant i ng t he set t l i ng part i es’ m ot i on forfi nal appr oval of t he sett l ement : Shapi r o & L odw i ck C o. , L PA , Spor t s & Spi ne P hy s i cal T her apy , I nc. , I r ene Pekoe , H o f f m a n L e g a l G r o u p , L L C , L a c yR e d d a n d C ro ss & S ir ( 07- 1759) ; R om er o G ener al C o n stru cti o n G rou p (07 -17 6 3 ); D an C

. D

. S turd ev an t ( 0 7 -17 6 9 ); V an E n terprises, I n c. (07 -17 7 9 ); I a a d O. , I n c . ( Tru s t e e o f 8 Pa c i f i c Str e e t Tru s t ) a n d Zo r k e s s LLC ( 07- 1786) ; E m er al d Fi nanci al G r oup, I nc. ( 07- 1793) ; Pal om ar G r adi ng and Pavi ng, I nc. ( 07- 1796) ; and H ar ol d Fol s om J ens en (07 -18 2 6 ).
T he fol l ow i ng obj ect or s fi led ti m el ynot i ces of appe al fr om t he D i s t r i ctC our t ’ s or deraw ar di ng at t orney s ’ fee s and expens es : V an Ent erpr i s es , I nc. ( 07- 2935) ; I aad O

. , I n c . ( Tru s t ee o f 8 P ac ifi c S tr ee t T rust) a n d Z o rke ss L L C (07 -29 5 7 ); S h ap ir o & L odw i ck C o. , L PA and Spor t s & Spi ne Phy s i cal T her apy , I nc. ( 07- 3037) ; L acy R edd and C r os s & Si r( 07- 3038) ; I r ene Pekoe and H offman L egal G r oup, L L C ( 07- 3039) ; R o m er o G ener al C o n stru cti o n C o rp. (0 7 -30 4 0 ); D an C

. D

. S turd ev an t ( 0 7 -30 4 2 );A pp el l ants S hap i ro & L od w i ck C o. , L P A ; S po rt s & 11 Spi ne Phy s i cal T her apy , I nc. ; I r ene Pekoe ; H offm an Legal G roup, LL C ; L acy R edd ; C ross & S i r; Iaad O

. , Inc. ; and Z orkess L L C jo in tly f

iled o n e a p p e llate b rie f. In a d d re ss in g a rg u m e n ts pr es ent ed byt hi s gr oup, w e w i l l r efe r to the m as the Ia a d /Z o rk e ss o b

jec to rs. A p p e llan t V a n E nterpri ses s u b m itt e d its o w n a p p e llate b rie f; th e re f o re , w e w ill id e n tifya rg u m e n ts pr es ent ed i n t hi s br i ef byr efe r r i ng t o V an E nt erpr i s es . T he r emai ni ng appel l ant s fi l ed a mot i on t o adoptthe br i efs s ubm i t t ed on beh al f of

t he Iaad/Zo rkess obj ect ors and V an E nterpri ses. T he G al l agherD efe n d ant s ar e a gr oup of i ns ur ance 12 brokers com pri sed of

A rthu r J

. G al l agh er & C o. , A rthu r J

. G al l agherR i s k M anage m entSer vi ces , I nc. , an d G al l agher B enef it S ervi ces , I nc. T he G al l agherD efe ndant s r emai ned p a rties to b o th th e C o m m e rc ial C a se a n d th e E m p lo y e e B e n e f its 25 E m er al d F inanci al G r oup, I nc. , Pal om arG r adi ng and Pavi ng, Inc

. , an d H aro ld F o lsom Jen sen (07 -30 4 1 ). 11

T hroug h v ari ou s consoli dati o ns, the ap peals of these obj ect or s fr om bot h t he D i s t r i ct C our t ’ s fi nal appr oval or derand it s att o rne y s’ fe es ord er ha v e be en joine d tog ethe r. A lt o g ethe r, t her e ar e s i xt een c ons ol i dat ed a ppeal s r el at ed t o t he Zuri ch S e ttl e m e n t.
B. The G al l ag he r Se t t l e m e nt
I n D ece m ber2004, the G al l agherD efe ndan t s wer e added to the class a cti o n li ti g ati o n . T h e G all ag h er D ef en d an ts w ere 12C as e af t ert he D i s t r i ctC our tcr eat ed tw o di s t i nct docket s forthe cl as s act i on l i t i gat i on. I ti s uncl earfr om t he r ec or d w hethert he G al l agher 13 D efe ndant s ent er ed i nt o s i m i l ar agr eement s w i t h other s t at es or w ere ab le t o reso lve a ll o f th e state inv est ig a tio n s tha t w ere pen ding aga i nstt hem t hroug h these agreem ents

. 26 al s o s ubj ectt o ongoi ng i nves t i gat i ons bys t at e att orney s gener al and s t at e i ns ur ance depart m ent s forpos s i bl e ant i com pet i t i ve act i vit i es. O n M ay18 , 20 05 , t he G al l agh er D efen dan t s, w ho se p rin c ip a l p lac e o f b u sin e ss a n d h e a d q u a rte rs a re lo c a te d in I l l i no is , ent er ed i nt o an A s s ur ance of V ol unt aryC om pl i ance w i t h t he A t t or neyG ener al of I l li n o is and the D i r ect orof the I l l i noi s D i vi s i on of I ns ur ance , and a St i pul at i on and C ons ent O r derw i t h t he D i r ect orof the I l l i noi s D i vi s i on of Ins ur ance . U n d e r th e ter m s o f

th e se a g re e m e n ts, th e G a llag h e r D e f e n d a n ts vol unt ar i l yi m p l ement ed var i ous bus i nes s r eform s and tr an sfe rr ed $ 2 6 , 9 6 2 , 5 0 0 into a fu n d fro m w h ich a m o u n ts w ere dis t ri bu t ed to cert ai n q uali fy i ng G al l agh er cust om ers . 13

I n A pr i l 2005, t he G al l a g h e rDef e n d a n t s b e g a n s e tt l ement agr eementnegot i at i ons w i t h t he pl ai nt i ffs and, m or e than a y ear a n d a h a lf

late r, o n D e c e m b e r 2 9 , 2 0 0 6 , the p a rties e n ter e d in to a S ti p u lat ion o f S ett lem en t ( G all ag h er S ett lem en t A g ree m en t)

. Sever al amendm ent s t o t he G al l ag h er Sett l ementA gr eement w er e fi l ed i n t he fol l ow i ng m onths , one of w hi ch inc lude d t he s ubm i s s i on of a Pl an of A l l ocat i on. T h e p r opos ed G al l agher Set t l ementA gr eementcal l ed forthe cr eat i on of a $28, 000, 000 s et t l ementfund t o be pai d t o ins ur eds w ho fel l w i t hi n the27 defi ni t i on of t he Set t l ement C l as s and w as i nt ended t o “r es ol ve a ll cla im s th a t h a v e b e e n , o r c o u ld h a v e b e e n , a s s e r te d in th is act i o n b yPl a i n t i f

f s a g a i n s tth e Gal l a g h e rDef e n d a n t s . ” The Set t l ement C l as s w as defi ned as “al l i ndi vi dual s orent i t i es ” w ho “p u rch ase [d ] or ren ew [e d ] co m m erc ial ins ur ance , orr ei ns ur ance t her eof, obt ai ned t hr ough engagi ng the servi ces of the G al l agher D efe ndant s ” oranyB r okerD efe n d an t dur i ng t he cl as s per i od, and “a l l i ndi vi dual s or ent i t i es ” t hat “w er e empl oy er s pr ovi di ng empl oy ee benef

i t s i ns ur ance ” and empl oy ees recei vi ng “empl oy ee benef

i t s i ns ur ance ” t hr ough an empl oy ers pons or ed pl an t hat w as obt ai ned thr ough t he G al l agherD efe ndant s orany B r okerD efe ndantdur i ng t he cl as s per i od. ( G al l agher A pp. 409- 10. ) Forpurpos es of al l ocat i on, t he S ett l ementC l as s w as divi ded i nto si x separat e cl ai m ant gr ou ps: “C om m er ci al C las s m ember s w ho pur chas ed or r enew ed comm er ci al i ns ur ance ei t her thr ough a G all ag h er E n ti ty

(‘C o m m er c ia l D ir e ct C lai m an ts’ ) ora C om m er ci al B r okerDef e ndant( ‘ C om m er ci al C ons pi r acyC l ai m ant s ’ ) , E m pl oy erm ember s of t he Em pl oy ee Benefi t s C l as s w ho pur chased or r enew ed empl oy ee be nefi t s i ns uran ce e i t her t hr ough a G al l agherE nt i t y( ‘ E m pl oy erD i r ect C l ai m ant s ’ ) oran Em pl oy ee Benefi tB r oker D ef en d an t ( ‘E m p loy er C o n sp ir ac yC lai m an ts’ ), and al l E m pl oy ee mem ber s of the Em pl oy ee B enef i t s C l as s w ho pur chas ed orr enew ed empl oy ee benefi t s i ns ur ance ei therthr ough a G all ag h er E n ti ty(‘E m p loy ee D ir ec t C lai m an ts’ ) ort hr ough an Em p loy ee Benefi t s B r oker D e f e n d a n t (‘E m p lo y e e C o n s p ir a c yC la im a n ts ’) .”28 T hus t he cl ai m ant gr oups w er e ca t egor i zed ba s ed on the type of i ns ur ance i nvol ved and w hethert he i ns ur ance w as pur chas ed th ro u g h th e G a llag h e r D e f e n d a n ts or a n o th e r B ro k e r D e f e n d a n t. U nderthe P l an of A l l ocat i on, t he fund w as t o be di s t r i but ed among the cl ai m ant gr oups as fol l ow s : 68% t o C o m m erci al D i rect C l ai m ants , 13

. 2% t o C om m erci al C on spi racyC l ai m ants , 3. 6% t o E m pl oy erD i r ectC l ai m ant s , 0. 5% t o E m pl oy er C on spi racyC l ai m ants , 13

. 3% t o E m ploy ee D i rectC l ai m ants , and 1. 4% t o E m ploy ee C on spi racyC l ai m ants

. I n addi t i o n t o e s t ab l i s h i ng a s et t l ementfund, the pr opos ed G al l agherSet t l ementA gr ee m ental s o r equi r ed the G al l agher D efen dan t s t o m ake ce rt ai n ch ang es t o thei r al l eged bu si ness pr act i ces – s uch as pr o h ibit i ons on acc ept i ng cont i ngent compe n s at i on, “payt o pl ay ” arr angement s , “bi d r i ggi ng” arr angement s , r ei ns ur ance l ever agi ng, and i nappr opr i at e us e of w hol es al e i ns ur ance br oker s – and t o m ak e cer t ai n di s cl os ur es t o cu st om ers and i m plem ent cert ai n t rai ning for i t s em ploy ees. T he G al l agherD efe ndant s al s o agr eed t o pay t he admi ni s t r at i on and di s t r i but i on cos t s as s oci at ed w i t h the G al l agherSet t l ement A g re e m e n t.
O n A pr i l 13, 2007, the D i s tr ict C our tent er ed an or der p re lim in a rilyc e rtifyi n g th e S e tt lem e n t C las s a n d p re lim in a rily appr ovi ng t he G al l agherSet t l ementA gr eement

. T he D i s t r i ct C ou rt set J une 29, 2007 as t he dea dl i ne fort he fi l i ng of excl us i ons and obj ect i ons t o t he propos ed G al l agherSet t l ement A gr eement and s chedul ed a f ai r nes s hear i ng forJ ul y24, 2007. Pur s uantt o t he D i s t r i ct C our t ’ s or der , t he admi ni s t r at orm ai l ed not i ce of t he pr opos ed G al l agherSet t l ementA gr eement t o over 288, 000 pot ent i al Set t l ementC l as s M ember s and al s o publ i s hedIn a d d iti o n , the D istric t C o u rt a lso re c e iv e d 2 0 6 tim e ly 14
r eques t s forexcl us i on fr om t he pr opos ed G al l agherSet t l ement A g re e m e n t. 29 not i ce of t he G al l agher Set t l ement A gr eementt w i ce i n The N ew Y ork Ti m es , The W

al lStr eet Jour nal , and U

SA Today , o n c e in B us i nes s I

ns ur ance M

agaz i ne and R is k M

anagem ent

Magaz i ne , and once i n t he new s paper w i t h t he l ar ges t ci r cul at i on i n eac h of t he fi ftys t at es and the D i s t r i ct of C ol um bi a. T he admi ni s t r at or al s o es t abl i s hed a w ebs i t e and t ol l

- fr ee hot l i ne t o pr ovi de m at er i al r el evantt o t he pr oposed G al l agherSet t l ement A g re e m e n t.
O n lytw o S e ttl e m e n t C las s M e m b e rs f iled o b jec tio n s to t he Gal l a g h e rSe tt l e mentA gr eement

. T he obj ect i ons per t ai ned 14 t o t he amountof the s et t l ement , r equi r ement s of t he s ett l ement cl ai m form , the al l ocat i on of the s et t l ement , and w hethert he r equi r eme n ts o f cl as s cert i fi cat i on w er e s at i s fi ed. O ne of the tw o o b jec to rs, a p p e llan t V a n E n terp rise s – w h o a lso o b jec ted to t he Zuri ch Set t l ement – fai l ed t o appea r atthe fa i r nes s hear i ng des pi t e havi ng fi l ed a N ot ice o f I nt ent i on t o A ppear . T he D i s t r i ctC our ti s s ued an or deron Sept ember 4 , 2 0 07, gr ant i ng t he G al l agher D efe ndant s ’ and pl ai nt i ffs ’ m ot i on for f inal appr oval of the s et t l ementand di s m i s s i n g the G al l agher D efe ndant s fr om t he l i t i gat i on w i th pr ej udi ce, det erm i ni ng that al l of the obj ect i ons l acke d m er i tand conc l udi ng t hatthe Set t l ementC l as s coul d be ce r t i fi ed and the G al l agherSet t l ement A g r eementcoul d be appr oved cons i s t entw i t h t he R ul e 23A s i n t he Zuri ch Set t l ement , the pl ai nt i ffs as ked the 15 D istric t C o u rt to c o n sid e r o n lyw h e th e r th e re q u ire m e n ts o f R u le 2 3 (b )(3 ) w e re m e t. 30 requi rem ents

. I

n r e I ns
. B r okerage Ant i tr us tLi t ig. , 2 0 0 7 WL 15 2589950 ( D

. N

. J

. Sept

. 4, 2007) ( G al l agherSet t l ementFi nal A p p rov al O p inion ).
S e p a ra tely , the G a llag h e r D e f e n d a n ts a g re e d to p a yu p to $8, 885, 000 fo r C l as s C ouns el ’ s at t orney s ’ fee s , l i t i gat i on expens es , and i ncent i ve aw ards foreac h of the tw enty - fi ve named pl ai nt i ffs

. T hes e fees w er e not t o be deduct ed fr om t he $28, 000, 000 s et t l ementfund. N o par t y obj ect ed t o the pet i t i on f o r f e e s, a n d th e D istric t C o u rt a p p ro v e d it.
V an Ent erpr i s es fi l ed a t i m el ynot i ce of appea l fr om t he D i s t r i ctC our t ’ s or dergr ant i ng the mot i on for fi nal appr oval of th e se ttl e m e n t (0 7 -3 6 8 7 ) a n d is th e o n lyo b jec to r th a t re m a in s in th is a p p e a l.
I I . Juri s di ct i on T he D i s t r i ctC our thad j ur i s di ct i on overt he Sherm an A ct a n d R IC O c laim s, w h ich in v o lv e d f e d e ra l q u e stio n s, p u rsu a n t to 28 U

. S. C

. § 1331 and had s uppl ement al j ur i s di cti o n overt he s t at e l aw cl ai m s , w hi ch ar os e out of t he same com m on nucl eus of oper at i ve fa ct s , pur s uantt o 28 U

. S. C

. § 1367. E ach of t he t hr ee de ci s i ons of the D i s t r i ctC our tt hat i s undercons i der at i on w as a fi nal or derand w e have j ur i s di ct i on to rev i ew themW e cons o li d ated the a p p ea ls from the Z u ri ch Sett l ement 16 and the G al l agherSet t l ementforpurpos es of ora l ar gum entand di s pos i t i on. 31 pur s uantt o 28 U

. S. C

. § 1291. “W e r evi ew a cl as s cert i fi cat i on 16 o rde r fo r ab u se o f d iscreti o n , w h ich o cc u rs i f th e d istri ct co u rt ’s deci s i on r es t s upon a cl ear l yerr oneous fi ndi ng of fact , an err ant concl us i on of l aw or an i m pr oper appl i cat i on of l aw t o fac t

. ” In r e H ydr ogen Pero xi de Ant i tr us tLi t ig. , 552 F. 3d 305, 312 ( 3d C i r . 2008) ( i nt ernal quot at i on m arks om i t t ed)

. “The deci s i on of w hethert o appr ove a pr opos ed s ett l ement of a cl as s act i on i s l eft t o t he s ound di s cr eti o n o f t he di s t r i ctcour t

. ” I n r e Prudent i al I ns
. C o. A m
. Sal es P r act i ce Li t ig. A gent A ct i ons , 148 F. 3d 283, 2 9 9 ( 3 d C i r . 1 9 9 8 ) ( i n t e r n a l q u o t a t i o n m a r k s o m i t t e d )

. We r evi ew a di s t r i ctcour t ’ s aw ar d of att orney s ’ fee s for an abus e of d iscretion , takin g into c o n side rati o n w h ethe r th e d istri ct co u rt empl oy ed the pr operl egal s t andar ds , fol l ow ed the pr oper p ro c e d u re s, a n d m a d e f in d in g s o f

f a c t th a t ar e n o t cle a rly e rr o n e o u s . I

n r e C endant

C or p. PR ID E S Li t ig. , 243 F. 3d 722, 7 2 7 (3d C ir

. 2 0 0 1 ).
I I I . A nal ys i s of

t he Fi nalA ppr ov alof t he Set t l em ent s and the A w ard of F ees W e begi n our anal y s i s w i t h an overvi ew of the s t andar ds forcert i fy i ng a s et t l ementcl as s and appr o v ing a cl as s act i on se ttl e m e n t. N e x t, w e re v iew th e D istric t C o u r t’s d e c isio n s in bot h t he Zuri ch Set t l ementand the G al l agherSet t l ementand c o n sid e r th e a rg u m e n ts th a t t h e o bjec to rs r a ise w ith re sp e c t to eac h of t hes e deci s i ons . Fi nal l y , w e pr ovi de an ove r vi ew of the32 s t a n d a r d s f

o ra p p r o v i n g a n a war d o f a t t o r n e y s ’ f

e e s , a n d we rev iew th e D istri ct C o u rt ’s de cisi o n g ran ti n g C lass C o u n sel’s pet i t i on foran aw ar d of fe es in the Z u r i ch Set t l ement , t aki ng i nt o con side rat i on t he ar gum ent s t hatt he obj ect or s r ai s e on a p p e a l.
A . R eq u irem en ts for A p p ro v ing C lass S ettlem en ts
In o rd e r t o a p p ro v e a c la s s s e ttle m e n t a g re e m e n t, a dis t ri ctcou rtm ustdeterm i ne thatt he requ i rem ents for cl ass cert i fi cat i on under Feder al R ul e of C i vi l Pr ocedur e 23( a) and ( b) are m etand m ustdeterm i ne thatt he set t l em ent i s fai r t o the clas s u n d e rF e d e r a l Ru l e o f

Ci v i l P r o c e d u r e 2 3 ( e )

. As th e S u p r e me C o u rth as m ad e c lear:

“ C o n f r o n ted w ith a re q u e st f o r se ttl e m e n t-o n ly class c erti fica ti o n , a d istri ct c o u rtn ee d n o t i n q u ir e w hethert he ca s e, if t r i ed, w oul d pr es ent i nt r act abl e managementprob l ems, fort he pr opos al i s t hatther e be no tr i al

. B utother sp e c if ic a tio n s o f

[ R u le 2 3 ] – th o se d e sig n e d to pr ot ectabs ent ees bybl ocki ng unw arr ant ed or overbr oad cl as s defi ni t ion s – dem and undi l ut ed, even he i ght ened, at t ent i o n i n t he s et t l ement c o n te x t.”
A m chem P r ods

. , I

nc. v. W i nds or , 521 U

. S. 591, 620 ( 1997) ( ci t ati o n om i t t ed)

. “[I ] f a f ai r nes s i nqui r yunderR ul e 23( e) contr ol led cer t i fi cat i on, ecl i ps i ng R ul e 23( a) and ( b) , and p erm i t t i ng cl as s des i gnat i on des pi t e the i m pos s i bi l i t yof l i t i gat i on, bot h cl as s couns el and cour t w oul d be di s arm ed. ” I d.33 at621. T hus , i ti s i m por t antt o “appl y [] t he cl as s cert i fi ca t i on r equi r ement s of R ul es 23( a) and ( b) s epar at el yfr om [the] fai rnes s det erm i nat i on under R ul e 23(e )

. ” In re Pru den t i al I ns. C o. , 148 F. 3d at308.
“The r equi r ement s of [R ul e 23] ( a) and ( b) ar e des i gned t o i ns ur e thata pr opos ed cl as s has ‘ s uffi ci ent uni t ys o thatabs ent cl ass m em bers can fai rl ybe b ou nd bydecis i o n s o f cl ass r epr es ent at i ves . ’ ” I

d. at309 ( quot i ng A m chem , 521 U

. S. at 621)

. U nderR ul e 23( a) , the pr er equi s i t es t o cl as s cert i fi cat i on ar e:

“ (1 ) th e c las s is so n u m e ro u s th a t jo in d e r o f a ll m ember s i s i m pr act i cabl e; ( 2) t her e ar e ques t i ons o f l a w o rf a c tc o mmo n t o th e c l a s s ; ( 3 ) th e c l a i ms o r def ens es of the r epr es ent at i ve part i es are t ypi cal of t he cl ai m s or defe ns es of t he cl as s ; and ( 4) t he r epres ent at i ve part i es w i l l fai r l yand a d e q u a te ly p ro te c t th e in te re s ts o f th e c la s s .”
F e d . R . C iv . P . 2 3 (a ); s ee Am chem , 521 U

. S. at613. I f al l of the pr er equisi tes o f R ul e 23( a) ar e s at i s fi ed, a cl as s act i on m aybe m ai nt ai ned i f t he st andar ds s et for t h i n R ul e 23(b) ar e s at i s fi ed as w ell

. F ed

. R

. C iv. P. 23 (b). R u le 2 3 (b)(3 ) re q u ir es “the co u rt [t o] fi nd [] that the q ue stio ns of law or factcom m on t o clas s m e m b e rs p re d o m in a te o v e r a n yq u e stio n s a f f e c tin g o n ly i ndi vi dual m ember s , and thata cl as s act i on i s s uper i ort o other avai l abl e met hods forfai r l yand ef fi ci ent ly ad

j udi cat i ng the c o n tro v e rsy. ” F e d . R . C iv . P . 2 3 (b )(3 ); s ee al so A m chem , 521 U

. S. at 618 ( “A m ong curr entappl i cat i ons of R ul e 23( b) ( 3) , t he

‘ s et t l ementonl y ’ cl ass has become a s t ock devi ce. ”)

. T he34 “[f ] actual det erm i nat i ons nece s s aryt o m ake R u l e 23 fi ndi ngs m us tbe made bya pr ep o nder ance of the evi dence

. I n other w or ds , t o cert i fya cl as s the di s t r i ctcourtm us t fin d t hatthe e v id e n c e m o re lik e lyth a n n o t es tab lish e s e a c h f a c t n e c e ss a ryto m eetthe requi r ement s of R ul e 23. ” I n r e H ydr ogen Perox i de A nt i tr ustLi t ig. , 55 2 F

. 3d at32 0. A ccordi ng l y , “[c]l ass ce rt ifi ca ti o n is pro p er o n ly if th e tri al co u rtis sati sfied , af ter a r i gor ous anal y s i s , t hat t he pr er equi s i t es of R ul e 23 ar e met

. ” I d. at 30 9 (i n terna l qu o tat ion m ark s o m itted).
“Even i f i thas s at i s fi ed the re qui r ement s forcert i fi cat i on underR ul e 23, a c lass ac t i on cannotbe s ett l ed w i t houtt he appr oval of the courtand a d eter m i nat i on t hatt he pr opos ed s et t l ementi s fai r , r eas onabl e and a dequat e. ” I n r e Prudent i al I ns
. C o. , 1 4 8 F .3 d a t 3 1 6 (in ter n a l q u o tatio n m a rk s o m itt e d ); s ee Fed. R

. C i v. P. 23( e) ( 2) ( s t at i ng t hat a di s t r i ctcour tm ayappr ove a pr opos ed s et t l ement “onl y aft era hea r i ng and on fi ndi ng that i ti s fa ir , r eas onabl e, and ade quat e”)

. I n G i rs h v. Jeps on , our C our tar t i cul at ed ni ne f ac tor s t o be cons i der ed w hen d e ter m in in g th e f

a irn e ss o f

a p ro p o se d se ttl e m e n t:

“‘ ( 1) t he compl exi t y , expens e and l i kel ydur at i on of the l i t i gat i on; ( 2) t he r eac t i on of t he cl as s t o t he s et t l ement ; ( 3) the s t age of the proc eedi ngs and t he amountof di s coverycompl et ed; ( 4) the r i s ks of es t abl i s hi ng l i abi l i t y ; ( 5) the r i s ks of es t abl i s hi ng damages ; ( 6) t he ri s ks of m ai nt ai ni ng t he cl as s act i on t hr ough t he tr i al ; ( 7) the abi l i t yof th e d e f e n d a n ts to w ith sta n d a g re a ter ju d g m e n t; ( 8) t he r ange of

r eas onabl enes s of the s ett l eme nt fund i n l i ghtof the bes tpos s i bl e r ecove r y ; ( 9) the35 ra n g e o f re a so n a b len e ss o f th e se ttl e m e n t f u n d to a pos s i bl e r ecove r y i n l i ght of al l t he at t endant ri sk s o f li ti g ati o n . ’”
521 F. 2d 153, 157 ( 3d C i r . 1975) ( i nt ernal quot at i on m arks and al t er at i ons om i t t ed)

. “[W ] her e s et t l ement negot i at i ons pr ece de cl as s cert i fi cat i on, and appr oval for s et t l ementand ce r t i fi cat i on ar e s oughts i m ul t aneous l y , w e r equi r e di s t r i ctcour t s t o be eve n m or e s crupul ous t han us ual w hen exa m i ni ng t he fa i r nes s of the pr opos ed s et t l ement

. ” I n r e War f a r i n S o d i u m Ant i tr u s tLi t ig. , 391 F. 3d 516, 5 3 4 (3d C i r . 2004) ( i nt ernal quot at i on m arks o m itted).
B . C hal l enges t o t he A pproval

of t he Z ur i c h Se t t l e m e nt
1 . T h e D istr ict C o u r t’s A n a ly sis
T he D i s t r i ctC ourt gr ant ed fi nal appr oval of the Zuri ch S ett lem en t after co n clud ing that the R u le 23 req u ir em en ts w ere s ati s fi ed. Speci fi cal l y , t he D i s t r i ctC our tdet erm i ned thatt he pr opos ed Zuri ch Set t l ementC l as s m ett he s t andar ds es t abl i s hed byR ul e 23( a) beca us e the l ar ge, nat i onw i de cl as s of pl ai nt i ffs “ea s i l ys at i s fi es t he numer os i t yr equi r ement ” of s ubs ect i on ( a) ( 1) ; t he “m any comm on ques t i ons of l aw and fact ” sat i s fyt he comm onal i t yr equi r ement of s ubs ect i on ( a) ( 2) ; t he cl ai m s of the named pl ai nt i ffs ar e “i ndi s t i ngui s habl e” f r o m t hos e made on behal f of the s et t l ementclass and “ encompas s [] i dent i cal al l egat i ons ” ar i s i ng “fr om t he s ame cour s e of a ct i on t aken byt he Z ur i ch D efe ndant s , ” w hi ch s at i s fi es the typi cal i t yr equi r ement of s ubs ect i on ( a) ( 3) ; and the dual component s of the adequacy36 of r epr es ent at i on r equi r ementof subs ect i on ( a) ( 4) ar e s at i s fi ed b ec au se th e a tt o rne y s rep rese n ti n g th e n am ed p lai n ti ff s are “c le a rl y‘w e ll q u a lif

ie d a n d e x p e ri e n c e d c la s s a c tio n att o rne y s, ’” a n d th e in ter e sts o f th e n a m e d p lain tiff s “ a re n o t an tag o n istic to t hos e of the abse n t clas s m ember s . ” Zuri ch Set t l ementFi nal A ppr oval O pi ni on at*13- 15.
T he D i s t r i ctC our tal s o concl uded thatt he st andar ds of R ul e 23( b) ( 3) w er e met , fi nding t hatt he pr edomi nance re q uir em ent w as sat i sfi ed d ue to the “identi cal cl ai m s of b o th t he name d Pl a i nt i ffs and the abs entcl as s m ember s ar i s [i ng] fr om t he s ame se tof fa ct s r egar di ng the all eged c ol l us i ve and ant i compet i t i ve beha vi orof the Zuri ch D efe ndant s , ” and the s uper i or it yr equi r ementw as s at i s fi ed bec aus e l i t i gat i ng al l of t hes e cl ai m s “i n one ac t i on i s . . . fa r m o re de s i r abl e than num er ous s epar at e ac ti ons l i t i gat i ng the s ame i s s ues . ” I d. at *1 6. T hu s, t he D i stri ctC ou rtcon cl ud ed th a t the cl ass es t abl i s hed byt he Zuri ch Set t l ementA gr eem ent m etal l of the r equi r ement s of R ul e 23( a) and ( b) ( 3)

. T he D i s t r i ctC our tnot ed t hatV an Ent erpr i s es had as s ert ed i n i t s w r i t t en obj ect i on t hatt he Set t l ementC l as s “l acks com m onal i t y , t ypi cal i t y , adequa cyof r epr es ent at i on and a pr edomi nance of com m on i s s ues , ” butt he D i s t r i ctC our tr ej ect ed thes e cont ent i ons beca us e V an E n terp rise s “ p ro v id e [ d ] n o c o g e n t ar g u m e n t o r l e g a l b a sis to s uppor t t hes e ass er t i ons , fai l i ng t o r efe r ence a sin g le cas e, fr om t hi s oranyot herC our t , th at m i ghtexpl ai n i t s al l egat i ons . ” I d. at*17.
T he D i s t r i ctC our tal s o cons i der ed the fa i r nes s of the Z ur i ch Set t l ementA gr eementand found t hat none of the G i rsh “fa ct or s s ugges t [s ] thatt he pr opos ed s et t l ements houl d notbe37 appr oved. ” I

d. at *4. T he D i s t r i ctC our tfound thatt he fi r s tfi ve G i rsh fac t or s “overw hel m i ngl yw ei gh in favorof appr oval of [ t h e ] s e t t l e ment

. ” I

d. A s t o t h e f

i r s tf a c t o r– c o m p l e x i t y, ex p en se, an d li k elyd u rati o n o f th e li ti g ati o n

– the D istri ct C o u rt det erm i ned that “this cas e i nvol ves hi ghl ycompl ex l egal and fac tual i s s ues . . . [that ] w oul d undoubt edl y[l ead t o] a cos t l yand len g th y[ lit ig a tio n ] p ro c e ss f o r a ll p a rties ” a n d th a t “[ t]h is pr opos ed s et t l ementpr ovi des an i m m edi ate benefi tt o t he Pl ai nt i ffs

. ” I

d. A p p ly ing the s ec o n d fa ctor, th e D istri ct C o u rt “con cl u d e [ d ] that the sm al l nu m ber of o bject i on s byC l ass M ember s t o t h e sett l ementaw ar d, m or e s peci fi cal l y , t o t he cal cul at i on of the s et t l ementaw ar d and damages r es ul t i ng fr om t he conduc tof the Zuri ch D efe ndant s , s t r ongl yw ei ghs i n favor o f a p p r o v a l

. ” I

d. a t * 5 . T h e D istric t C o u rt d e ter m in e d th a t, undert he thi r d fac t or , t he s t age of pr ocee di ngs and the amount of di s coverycompl et ed w ei ghed i n favor of s et t l ementbeca us e,

“ [ b ]a se d u p o n th e a m o u n t o f tim e C o u n se l ex p e n d e d in negot i at i ons and the ext ent of t he di s covery pr oces s , . . . C ouns el h a d a th o ro u g h a p p re c iatio n f o r th e m e rits o f

th e c a se p rio r to s et t l ement

. ” I

d. a t * 6 . W ith re sp e c t to th e f o u rth a n d f

if th fact o r s , t he D i s t r i ctC our tconcl uded thatt he r i s ks of es t a b l i s h i n g b o t h l i a b i l i t ya n d d a ma g e s wei g h e d i n f a v o rof s et t l ementbeca us e “[ t ] hi s cas e i nvol ves di ffi cul t f actual and l egal i s s ues w h ich w oul d have tr ans l at ed i nt o pr otr act ed litig a tio n a n d a c c u m u la tin g e x p e n s e s , in b o th tim e a n d m o n e y .” I d. T he D i stri ctC ou rtcon cl ud ed it s G i rsh anal y s i s byA s w e not ed i n I n r e Prudent i alI

ns ur ance Co. A m er i ca 17 Sal es P r act i ce Li t igat i on A gent A ct i ons , 148 F. 3d 283, 323 ( 3d C i r . 1998 ), d ependi ng on the fa ct s of a gi ven ca s e, “i tm aybe u se f u l to e x p a n d th e tra d iti o n a l G i rsh fac t or s t o i ncl ude, w hen app ropri at e, ” add i t i on al fact ors “that bear on t he abi l i t yt o assess t he pr obabl e out come o f a tr ial on t he mer i t s of l i abi l i t yand in d iv id u a l d a m a g e s,” a s w e ll as “ th e e x iste n c e a n d p ro b a b le out come of cl ai m s b yot hercl as s es and s ubcl as s es ; t he compar i s on betw een the r es ul t s achi eved bythe s ett l ementfor i ndi vi dual cl as s or s ubcl as s m ember s and the r es ul t s achi eved – orl i kel yt o be ac hi eved – for other cl ai m ant s ; w hether cl as s or s ubcl as s m ember s ar e acc or ded t he r i ght t o opt outo f the sett lem en t; w h ethe r an yp rov isi o n s fo r att o rne y s’ fe es a re r eas onabl e; and w hetherthe pr ocedur e forpr oces s i ng i ndi vi dual cl ai m s undert he s et t l ementi s fai r and r eas onabl e. ” The P r udent i alfac t or s r el evant h ere w ei gh i n favorof the Zuri ch S e ttl e m e n t. F o r e x a m p le, c las s m e m b e rs h a d a rig h t to o p t o u t, a n d s o m e d id s o , s ee Z ur i ch Set t l ementFi nal A ppr oval O pi ni on at *5 ; th e D istri ct C o u rt fo u n d the claim s p roc essin g p roc ed u re f a i r a n d re a s o n a b le , s ee i d. at*10, and w e agr ee; and the att o rne y s’ fe es a w a rd e d in co n jun cti o n w ith the s ett lem en t are re a s o n a b le , see i nfr a P a r tI I I

. D. 38 det erm i ni ng t hatt he fi nal fourfac t or s w ei ghed “s l i ght l yor m oder at el yi n favorof appr oval

. ” I d. at*8. 17

Pr i ort o cert i fy i ng the class and appr ovi ng the Zuri ch Set t l ement , t he D i s t r i ctCou rta d d r e s s e do b j e ct i ons r egar di ng t he fai l ur e t o ut i l i ze s ubcl as s es . C ert ai n obj ect or s cl ai m ed thatt hr ee s ubcl as s es w er e nec es s arydue t o the al l ocat i on of funds underT he sug gest i on w as t o creat e t hree subclas ses: E x c ess 18 C l ai m ants , N on -Ex cess C l ai m ants , and C on spi racyC l ai m ants

. See sup ra not e 11. 19 39 t he Z uri ch S et t l em ent A greem e n t, and that each of these s ubcl as s es w as ent i t l e d t o s epar at e r epr es ent at i on. T he D i s t r i ct 18 C o u rt ackn ow l edg ed thatthe u se of sub cl asses i s approp ri ate w here m em bers o f a cl ass ha ve “i nter est s di vergen tfrom t he rest o f th e c la ss ,” b u t d e ter m in e d th a t th e o b jec to rs h e re “ f

a iled to ra is e , le t al o n e d e s c ri b e , any d iv e rg e n t o r a n tag o n istic in ter e sts betw een the thr ee gr oups . ” I d. at *1 8. T he D i stri ctC ou rtal so n o ted th a t “ [ a ] c las s n e e d n o t b e d iv id e d in to su b c las se s m e re ly beca us e di ffe r entgr oups have a l t ernat i ve l egal t heor i es for r ec o v e r y , o rb e c a u s e t h o s e g r o u p s h a v e d i f f e r e n tf a c tu a l b as es forr el i ef. ” I

d. at *17. T her efor e, t he D i s t r i ct C our t r ej ect ed the obj ect i on.

2. T he O bj ect ors ’ A rgum ent s on A ppeal
O n ap peal, t here are tw o p ri ncipal group s of obj ect ors: V an Ent erpr i s es , w ho s ubm i tt ed a br ief on i t s ow n behal f, and th e Ia a d /Z o rk e ss o b

jec to rs, w h o su b m itt e d a jo in t b rie f o n b e h a lf of s ever al obj ect or s . V an E nt erpr i s es pr es ent s n u m er ous 19 ar gum ent s i n i t s openi ng br i ef befor e t hi s C our t

. B r i efl ys t at ed, V an E n terprises cu rren tl ych all en g es th e D istric t C o u rt ’s c e rtif ic a tio n o f

th e c las s, a rg u in g th a t itf a iled to rig o ro u sly anal y ze th e R ul e 23 r equi r ement s and, i n par t i cul ar , thatthe Set t l ementC l as s i s overbr oad, r es ul t i ng i n a pr edomi nance of i ndi vi dual i s s ues as oppos ed t o comm on ones . V an Ent erpr i s esA l t hough V an Ent erpr ises obj ect ed t o the pet i t i on for 20 at t or ney s ’ fee s and fi l ed a not i ce of appea l fr om the D i s t r i ct C ou rt ’s order grant i ng at t orney s’ fees, i t did n ot, on app eal , rai se anyargum ents rel at ed to the aw ard of fee s. 40 al s o ar gues t hat t he named pl ai nt i ffs l ack s t andi ng beca us e they have notdemonstr at ed an i nj uryi n fac t

. B oth V an Ent erpr i s es an d the Ia ad /Z o rk e ss o b jectors c h all en g e the D istri ct C o u rt ’s fai l u r e t o u t i l i z e s u b c l a s s e s d e s p i t e t h e a l l o c a t i o n o f t he s et t l ementfund t o var i ous t ypes of pol i cyhol der s . T he Iaa d /Z o rke ss o b

jectors a lso c h all en g e the D istri ct C o u rt ’s aw ard of $ 29 , 95 0, 00 0 in at t orney s’ fees and exp enses. 20

a. F ai l ure t o P res erve A rgum ent s on A ppeal
A tt he out s et , the p lai nt i ffs as s ertthatV an Ent erpr i s es fai l ed to pr oper l ypr es erve i t s ar gum ent s w i t h r es pectt o t he Z ur i ch Set t l ement

. T heycont end thatt he ar gum ent s V an E nt erpr i s es now r ai s es on appea l w er e notpr es erv ed byV an E nt erpr i s es ’ w ri tt en obj ect i on i n the D i s t r i ctC our t , i n w hi ch V an Ent erpr i s es at t empt ed t o m er el y“i ncorpor at e byr efe r ence i nt o i t s obj ec ti o n everyar gum entr ai s ed i n everybr i ef, d e c lar a tio n a n d e x h ib it th a t w a s s u b m itt e d in c o n n e c tio n w ith Pl ai nt i ffs ’ m ot i on forcl as s cert i fi cat i on, as w el l as the D efe ndant s ’ m ot i on to d i s m i s s . ” I n ot herw or ds , the pl ai nt i ffs ar g u e t h a tt h i s “ c o n c l u s o r y ” wr i t t e n o b j e c t i o n “ s i mpl yc a n not s erve t o pr es erve forappea l the s pr aw l i ng ar gum ent s i tnow r ai s es conce r ni ng cert i fi cat i on of the Set t l eme n tC l as s . ” The plai nti ffs al so po i nt outthat “V an fa i l ed to at t e n d th e F ai rness H e a rin g , d u rin g w h ich it c o u ld h a v e e lab o ra ted o n its c ryp ticT h e f a c t th a t V a n E n terp rise s re p e a ted lyre f e rs to 21 document s w hi ch the non- s ett l i ng B r okerand I n s ur er D efe ndant s i n t he C om m er ci al C as e l i t i gat i on s ubm i t t ed t o t he D i s t r i ctC our ti s t r oubl i ng. W e fi nd i tpecul ia rt hatV an E nt erpr i s es ’ i nt er es t s ar e s o cl os el yal i gned w i t h t he non- s et t l i ng defe n d a n t s , b u tn o n e t h e l e s s we a c c e p tth e s e a r g u me n t s a tfac e val ue. 41 ar gum ent s m ade e nt i r el ybyr efe r ence . ” Thu s, the pl ai nt i ffs cont end that t he onl y ar gum ent s V an E nt erpr i s es pr es erved for appea l per t ai n t o t he Pl an of A l l ocat i on and t he purpor t ed nee d for subclas ses. A l t hough V an Enterp r i s es fr equent l yci t es s ubm i s s i ons t o t he D i s t r i ct C our t i n the C om m er ci al C as e l i t i gat i on – i ns t ead of i t s ow n w r i t t en obj ect i on – as s u p p o rt for the var i ous a rg u m e n ts it a d v a n c e s o n a p p e a l, V a n E n terp rise s a ss e rts th a t it s w r i t t e n o b

j e c t i o n p r e s e r v e d a l l o f t h e s e a r g u me n t s b e c a u s e t he obj ect i on “i nco rporat ed the m oti on s, res po n ses, bri efs, d e c lar a tio n s a n d e x h ib its f iled b y th e P lain tiff

s a n d D e f

e n d a n ts conce r ni ng cl as s cert i fi cat ion of a l i t i gat i on cl as s . ” V an E nt erpr i s es ar gues t hatt he D i s t r i ctC our t err ed bynot co n side ri n g thes e “ a d v e rsarial m o ti o n s an d b ri ef ing fo r a L i t i gat i on C l as s des pi t e emphat i c r eques t s fr om t he non- s et t l i ng D e f e n d a n ts a n d V a n E n te rp ri s e s .” 21
A s an i ni t i al m at t er , al t hough V an Ent erpr i s es di d not appea ratt he fa i r nes s hear i ng t o ar gue i t s obj ect i ons , i t s abs ence fr om t he hear i ng di d not caus e i t t o for fei t t he obj ect i ons i thad t i m el ys ubm i t t ed t o the D i s t r i ctC our ti n w r i t t en form . V an42 E nt erpr i s es act ed i n acc or dance w i t h t he not i ce pr ovi ded t o t he pot ent i al Set t l ementC l as s M ember s, w h i ch s t at ed that at t endanc e att he hea r ing w as notnece s s arys o l ong as an ob j e c t i o n was p r o p e r l y f i l e d wi t h t h e Di s t r i c t Cou r t b yt he deadl i ne: “I f y ou ar e a Set t l ement C l as s M ember

. . . and do notexclude y ou rs el f from the S et t l em ent C l ass, y o u m ay o b

ject t o the Z u ri ch S ett lem en t, an yterm of the Z u ri ch Set t l ementA gr eement , the Pl an of A l l ocati on or Plai nti ffs’ app l i cat i on for at t orney s’ f e e s a n d e x p e n se s. S u c h o bje c tio n m u st b e in w r i t i ng and mustpr ovi de evi dence o f y our m ember s hi p i n t he Set t l ement C l as s . T he w r i t t en o b jecti o n also sh o u ld stat e the s p ec ifi c re aso n (s), i f any , fort he obj ect i on, i ncl u di ng anyl egal s uppor ty ou w i s h t o br i ng t o the C our t ’ s att ent i on an d an yev iden ce y o u w ish to introd u ce in su p p o rt of the obj ect i on. A w r i t t en objec ti on ( and any s uppor tfori t ) m us t be re cei ved byt he C our tand t he fol l ow i ng couns el by no l at ert han J anuary11, 2007.
* * *
If (a n d o n lyif

) y o u m a k e a w ritten o b je c ti o n to t he Zuri ch Set t l ement a s s etoutabove, y ou m ay choos e t o s peak – e i t heri n per s on ort hr ough an at t or neyhi r ed aty ourow n expens e – att he hear i ng . . . t he C our t has s et t o cons i derw hether t o appr ove the Zuri ch Set t l ement

. Y ou ar e not43 r equi r ed t o at t end t he hear i ng. L ack of att endanc e att he hea r i ng w i l l notpr eventthe C our tfr om c o n s id e ri n g y o u r o b

je c tio n .” ( Z ur i ch A pp. 30 7 7 -79. ) T hus , w hi l e i tw as nece s s aryforV an E nt erpr i s es t o pr ovi de the gr ounds fori t s obj ect i ons i n w r i t i ng in ord er t o p rese rve it s arg u m en ts fo r ap p ea l, itw as u n n ec essa ry fori tt o appea ratt he hea r i ng.
H ow ever , we a r e n o to b l i g a t e d t o e n t e r t a i n a l l o f t he ar gum ent s t hatV an Ent erpr i s es pr es ent l yadvanc es . “A bs ent exce p t i onal ci r cumst ance s , thi s C our tw i l l notcons i deri s s ues r ai s ed fort he fi r s tt i m e on appe al

. ” D el

. N at i on v. P e n n sy lva n ia , 446 F. 3d 410, 416 ( 3d C i r . 2006) ( ci t i ng H a rr is v. C i t y of P hi l a. , 3 5 F .3 d 8 4 0 , 8 4 5 (3 d C ir. 1 9 9 4 )); see al so Salvat i on A r my v. D ep’ tof C m t y. A f f ai rs of N

. J. , 919 F. 2d 183, 196 ( 3d C i r . 1990) ( “The m att er of w hatques t i ons m aybe t aken u p a n d re so lv e d f

o r th e f irst tim e o n a p p e a l is o n e lef t p rim a rily t o t he di s cr et i on of the court s of appea l s , t o be exer ci s ed on the fa cts o f ind ividu al ca ses.” (interna l qu o tat ion m ark s o m itted)). F or an i ssue t o b e preserved for app eal , a p a rt y“m ust unequi vocal l yputi t s pos i t i on befor e t he t r i al cour t at a poi ntand i n a manner t hat perm i t s t he cour t t o cons i deri t s m er i t s . ” Sh e ll P etr ol eum , I

nc. v. U ni t ed Stat es , 1 8 2 F

. 3 d 2 1 2 , 2 1 8 (3 d C ir

. 1 9 9 9 ). A f

lee tin g re f

e re n c e o r v a g u e a llu sio n to a n iss u e w ill nots uffi ce t o pr es erve i tforapp ea l , s o “the cruci al ques t i on r egar di ng w ai veri s w hether defe ndant s pr es ent ed t he ar gum ent w i t h s uffi ci ents peci fi ci t yt o al ertt he di s t r i ctcour t

. ” Keenan v
. C i t y of P hi l a. , 9 8 3 F .2 d 4 5 9 , 4 7 1 (3 d C ir. 1 9 9 2 ); s ee al s o Fr ank v
. Col t I

n d u s
. , I nc. , 910 F. 2d 90, 100 ( 3d C i r . 1990) (“P arti cu larl yw h ere im p o rt an t and co m p lex is s u es o f law areB eca us e V an Ent erpr i s es fai l ed t o appea rbefor e the 22 D i s t r i ctC our tatt he fa i r nes s hear i ng, V an Ent erpr i s es for fei t ed t he oppor tuni t yt o zea l ous l yadvoca t e i t s obj ect i ons i n p erson and expound upon the cha l l eng es tha ti tr ai s ed i n i t s w r i t t en o b jecti o n . A p rac ti ca l con seq u en ce o f V an E n terprises’ fa il u re t o appea r att he fa i r nes s hear i ng, combi ned w i t h i t s s ubm i s s i on of a r el at i vel ys par s e w r i t t en obj ect i on, i s thati t s gr ounds for c h a llen g in g th e a p p ro v a l o f th e se ttl e m e n t w e re n o t w e lldevel oped and, nots urpri sing ly , w er e notper s uas i ve t o t he D istric t C o u rt. 44 pr es ent ed, a far m or e det ai l ed expos i t i on of ar gum enti s r equi r ed to p re se rv e a n iss u e .”). T h u s, th e a rg u m e n ts th a t w e re p ro p e rly pr es erved for appea l ar e l i m i t ed t o t hos e w hi ch V an Ent erpr i s es pr es ent ed w i t h atl eas ta mi ni m um l evel of thor oughnes s t o t he D i s t r i ctC our tt hr ough i t s w r i t t en obj ect i on and, w i t houtt he e x iste n c e o f

c o m p e lli n g c irc u m sta n c e s, w e n e e d n o t en ter tain ch all en g es to the a p p rov al o f th e Z u ri ch S ett lem en t w h ich w ere n o t b e f o re th e D istric t C o u rt. 22

T ur ni ng t o t he subst ance of V an Ent erpr i s es ’ w r i t t en obj ect i on, w e ar e abl e t o di s cern t hatV an Ent erpr i s es ’ pr i nci pal chal l enges t o t he appr oval of t he Z ur i ch Set t l ement ar e thatt he Set t l ementC l as s i s overbr oad – w hi ch i m pact s t he R ul e 23 r equi r ement s of comm onal i t y , typi cal i t y , and pr edomi nance of com m on i ssues – and that ant ago nis t i c i nter est s am on g the cl ass m em bers exi stsuch t hat, i n the absence o f separat e subclass es, t he ade quacyof re pr es ent at i on r equi r ement i s nots at i s fi ed and t he Pl an of A l l ocat i on i s notfai r . ( Z ur i ch A pp. 2439. ) V an E nt erpr i s es di d not o ff

er m uch s uppor ti n i t s w r i t t en obj ect i onI n t ot al , V an E nt erpr i s es pr es ent ed ei ght een sub- 23 ar gum ent s i n i t s openi ng br i ef on a ppeal

. W hi l e w e have id e n tifie d th e o b

jec tio n s th a t w e re p re se rv e d , w e w ill n o t li st a ll of the curr entobj ect i ons thatw er e notpr es erved. 45 to su b stan ti ate it s arg u m e n t th at th e R u le 23 req u ir em en ts are n o t sa tisf ied , b u t ra th e r po site d th a t th e S e ttl e m e n t C las s s h o u ld not b e c e r t i f

i e d u n l e s s th e l i t i g a t i o n c l a s s c a n p r o p e r l ybe cert i fi ed, and thus V an Ent erpr i s es as s ert ed thatt he D i s t r i ct C our t neede d t o cons i der al l of t he fi l i ngs i n t he cl ass act i on l i t i gat i on t hathave a bear i ng on w hethercer t i fi cat i on of the l i t i gat i on cl as s i s appr opr i at e. V an Ent erpr i ses als o di d not su b stan ti ate it s arg u m en t th at s u b classe s w ere n ee d ed to en su re a fa i ral l ocat i on of t he sett l ement fund ot her t han t o s aythatthe P lan o f A ll o ca tio n tr ea ts va ri o u s typ es o f p o li cy h o lders d i f f e r e n t l y. A lth o u g h V a n E n terp rise s d e tra c ts fro m th e c r e d ib ili ty and per s uas i venes s of i t s obj ect i ons by pr es ent i ng t hem i n s uch a c o n c lu so ryf

a sh io n , w e n o n e th e les s w ill c re d it i ts e x p licit m ent i on of the comm onal i t y , t ypi cal i t y , and pr edomi nance r equi r ement s of R ul e 23( a) and ( b) , as w el l as i t s br i ef d isc u ss io n o f

th e n e e d f

o r su b c las se s – w h ic h to u c h e d o n b o th t he adequ acyof r epr es ent at i on r equi r ementof R ul e 23( a) and t h e f a i r n e s s o f t h e Pl a n o f Al l o c a t i o n u n d e r Rul e 2 3 ( e ) – and w i l l cons i dert hes e s peci fi c cha l l enges o n appea l

. B utbey ond th e se o b jec tio n s, V a n E n terp rise s h a s f o rf e ited th e o p p o rtu n ity to c h a llen g e o th e r a sp e c ts o f th e D istric t C o u rt’ s d e c isio n to appr ove t he Z ur i ch Set t l ement by fai l i ng t o m ake an ym ent i on of thos e ar gum ent s i n i t s w r i t t en obj ect i on. 2346 T he att or ney s gener al ar gue thatamong t he i s s ues that V an E nt erpr i s es has fai l ed t o pr es erve forappea l i s i t s chal l enge to the n am ed p lai n ti ff

s’ stan d ing

. T h e a tt o rne y s g en era l assert t hatt h e standi ng i s s ue “w as notaddr es s ed i n V an’ s or i gi nal obj ect i on. . . . I f V an had s er i ous l ybel i eved ther e w as an i s s ue o f s ta n d in g , it c o u ld h a v e ra is e d it a t t h e D i s t r i c t C o u rt le v e l.” T heyal s o not e that“[i ] n t he r el at ed ‘ G al l agher ’ s et t l ement , V an r a i s e d t h e [ s t a n d i n g ] a r g u me n ta n d w a s de ni e d b yt h e s a me D is tr ic t J u d g e a s h e re .”
W e agr ee thatV an Ent e rpr i s es ’ obj ect i on i s devoi d of any r efe r ence , expr es s ori m pl i ed, t o t he nam ed pl ai nt i ffs ’ s t andi ng and ther e i s no bas i s forcons t rui ng the obj ect i on as cont ai ni ng s uch a c hal l enge. I n a s om ew hatt el l i ng sta t ement , V an E nt erpr i s es now ar gues that“no s t andi ng i s s ues w er e addr es s ed byt he Set t l i ng Par t i es and D i s t r i ctC our ti n connec t i on w i t h [the Z ur i ch] Set t l ementC l as s . ” The l i kel yexpl anat i on forthe a b se n c e o f a sta n d in g a n a ly sis is th a t n o c h a llen g e w a s m a d e to t he pl ai nti ffs’ st and i ng and t he D i stri ctC ou rtdid not otherw i se dis cern a reas on t o incl ud e a dis cussio n of the plai nti ffs’ stan ding i n it s opini on . T hat s ai d, becau se “[s] t and i ng i s a t hr es hol d j ur i s di ct i onal r equi r ement , and w e have an obl i gat i on to e x a m in e o u r o w n ju ri s d ic tio n a n d th a t o f th e d is tr ic t c o u rt s ,” w e w i l l br i efl yaddr es s w hether t he named pl ai nt i ffs have s ta n d in g . I

nt er f ai th C m t y. O r g. v. H oneywel lI

nt ’ l , I nc. , 399 F. 3d 248, 254 ( 3d C ir

. 2005) ( i nt ernal quot at i on m arks and cit ati o n o m itted).
T ur ni ng t o t he “i r r educi bl e cons t i tut i o n al m i ni m um ” of st and i ng , t he S up rem e C ou rt has art i culat ed thr ee requir em ents :47 “F ir st, the p lai n ti ff m u st ha v e su ff ere d an ‘i n

jury i n fact ’ – an i nvas i on of a l egal l ypr ot ect ed i nt er es tw hi ch i s ( a) concr et e and pa r t i cul ar i zed and ( b) ‘ actual ori m m i nent , notconj ectur al or hyp ot het i cal

. ’ Second, t her e mustbe a c aus al connec t i on betw een the inj uryand the conduc t c o m p la in e d o f

– th e i n ju ry h a s to b e ‘f

a ir ly . . . tr ac e[a bl e] t o t he cha l l enged a ct i on of the defe ndant , an d n ot

. . . th[e] r es ul t[of] the ind ep en d en t acti o n o f so m e thir d p arty n o t bef o re t he cour t

. ’ T hi r d, i tm us tbe ‘ l i kel y , ’ as oppos ed t o m er el y‘ s pecul at i ve, ’ thatt he i nj uryw i l l be ‘red resse d b ya f

av o rab le de cisi o n . ’”
L u ja n v . D e

fen d e rs o

f W ild lif e , 504 U

. S. 555, 5 6 0 -61 ( 1992) (i n terna l ci tat ion s an d selec t qu o tat ion m ark s o m itted).
V an Ent erpr i s es ar gues that “the nam ed P l ai nt i ffs do not al l ege a nd have not s how n t hat any of t hei r pol i ci es w er e s ubj ect t o t he i m pr oper us e of cont i ngent comm i s s i on agr eement s , ” and t hus t heyhave not es t abl i s hed an i nj uryi n fac t

. V an Ent erpr i s es c o n ten d s tha t, a t b e st, “ P lain tiff s a lleg e th a t th e e n tire c las s p a id ‘hi gh er pr i ces that ar gu ablyensued i n [t he] e nti re i nd ust ry ’ as a r es ul to f Def e n d a n t s ’ al l egedl yant i compet i t i ve conduc tdi r ect ed a t s o m e s u b s e t o f

C la s s M e m b e rs .”
In r esp o nse, t he att orney s general assertthat “atl east s even of t he named pl ai n ti ffs pur chas ed Zuri ch i ns ur ance pol i ci es , ” and thatt hi s “i s s uffi ci entt o establ i s h s t andi ng for cl as s cert i fi cat i on purpos es ” bec aus e “[o] nce a named Pl ai nt i ff h a s b e e n sh o w n to h a v e sta n d in g a n d th e re f o re [ is] p ro p e rly48 befor e the C our t , ” the focus s hi ft s t o “compl i ance w i t h t he pr ovi s i ons of R ul e 23. ” A l t ernat i vel y , the pl ai nt i ffs ar gue that “b ec au se th e S ett lem en t C lass is l im it ed to tho se p o li cy h o lders w i t h a ‘ di r ectand i m m edi at e r el at i ons hi p’ t o a D efe ndantcocon spi rat or i n thi s A ct i on , and becau se al l S et t l em ent C l ass M em bers purchased insur ance a tpr i ces el evated byD efen dan t s’ unl aw ful s cheme, al l m em b ers of the Set t l ementC l as s have been i nj ur ed byt he ant i compet i t i ve cond u ct desc r i bed i n t he C om pl ai ntand ther efor e have s t andi ng. ” They ad d that“the p a y m ent of conti ng ent com m i ssi on s drove up the cost s of a ll i ns ur ance pol i ci es ” bec aus e “[ t ] hr ough a proc ess ca l l ed ‘pre m i um bui l d- up’ the cont i n g en t com m issi o n s p aid b yinsu rers w e re b u ilt in to f

o rm u la s u s e d to d e ri v e a ll r a te s .”
V a n E n terp rise s’ a rg u m e n ts m u st b e re jec ted b e c a u se it i s cl eart hatt he named pl ai nt i ffs a ll eged a concr et e and p a rticu lar ize d in

ju ry in f a c t. T h e p lain tiff

s a lleg e d th a t th e yp a id su p ra -c o m p e tit iv e p ric e s f o r th e ir in su ra n c e p o licie s a s a re su lt of the cont i n g entcomm i s s i on arr angement s and other a n tico m p e tit iv e c o n d u c t o f th e Z u ric h D e f

e n d a n ts. T h is incre ase in p ri ce co n sti tutes a c o n cre te i n juryin f ac t. M o reo v er, beca us e the nam ed pl ai nt i ffs pur chas ed i ns ur ance pol i ci es fr om th e Z u ric h D e f

e n d a n ts d u rin g th e re lev a n t cla ss p e rio d , the ir in ju rie s a re n e ith e r g e n e ra lize d n o r sp e c u lativ e . T h is is n o t to s ayt hatt he named pl ai nt i ffs have pr oven thattheyw er e i nj ur ed by the Z ur i ch D efe ndant s , butt heyar e notr equi r ed t o pr ove th e ir in ju rie s in o rd e r to e sta b lish th a t th e y a re a p ro p e r p a rtyto br i ng t hei r cl ai m s befor e the court

. A ddi t i onal l y , the pl ai nt i ffs a lleg e d th a t th e e c o n o m ic h a rm th e ysu f f e re d c a n b e tra c e d to t he Z ur i c h Def

e n d a n t s ’ c o n d u c ta n d t h e s e i n j u r i e s c a n be redr essed byi m p o sin g l i abil i t yon t he Z uri ch D efen dan t s.T her e i s no i ndi cat i on thatV an Ent erpr i s es cont es t s t he 24 D istric t C o u rt’s f

in d in g th a t th e su p e rio rity re q u ire m e n t o f R u le 23( b) ( 3) w as s at i s fi ed and i tis b ey o n d di s put e thatno s uch ar gum ent w as pr es erved i n V an Ent erpr i s es ’ w r i t t en obj ect i on. T h ere fo re, w e w il l no t add ress this asp ec t of R u le 23 (b)(3 ). 49 T herefore, w e are s at i sfi ed thatthe case an d co ntr o v e rsy r equi r ement of A r t i cl e I I I i s m et and t hat t he n am ed p la i nt i ffs had s t andi ng t o br i ng thi s cas e.

b. C hal l enges t o C l as s C ert i f i cat i on T ur ning t o t he mer i t s of V an Ent erpr i s es ’ pr es erved obj ect i ons t o cl as s cert i fi cat i on, V an ar gues t hat“[t ] he D i s t r i ct C o u rt fa il ed to r igo rou sly an aly ze the R u le 2 3 crit er ia b ef o re cert i fy i ng t hi s Set t l ementC l as s . ” A l t hough V an Ent erpr i s es speaks i n g e ne r a l t e r ms a bo uta l l of the Rul e 23 r e qu i r e ment s, V an’ s ar gum ent s ar e pr i m ar i l ydi r ect ed att he pr edomi nance compone n t o f R ul e 23( b) ( 3)

. N onethel es s , t o the ext entt hat 24 V an Ent erpr i s es cont i nues t o ar gue t hatthe comm onal i t yand typ ica lityre q u ire m e n ts o f R u le 2 3 (a ) w e re n o t sa tisf ied (a s it d id i n i t s w r i t t en obj ect i on) , w e r ej ectany su ch ar gum ent

. T he D i s t r i ctC our tcorr ect l y n o ted that“‘ comm onal i t ydoes not req u ir e a n iden ti tyo f c lai m s o r fa cts am o n g class m em b er s ’; r ather , ‘ [t ] he comm onal i t yr equi r ementw i l l be s at i s fi ed i f the n a m e d p lain tiff

s s h a re a t lea st o n e q u e stio n o f f a c t o r law w ith t h e g r i e v a n c e s o f

t h e p r o s p e c t i v e c l a s s . ’ ” Zu r i c h Se t t l e ment Fi nal A ppr oval O pi ni on at*13 ( quot i n g N e w to n v . Me rr ill Lynch, P i er ce, Fenner & Sm i th, I nc. , 2 5 9 F

. 3 d 1 5 4 , 1 8 3 (3d C ir

. 2001) )

. I ndeed, t he D i s t r i ct C o u rt l i s t ed s ever al comm on50 ques t i o n s of l aw and fa ctbefor e conc l udi ng t hatthe c o m m o n a lity re q u ire m e n t w a s sa tisf ied

. W e f in d n o e rro r in th is d e ter m in a tio n . A n d w ith re sp e c t to th e typ ica lityre q u ire m e n t, t he D i s t r i ctC our ts t at ed that“‘ i f the cl ai m s of the named pl ai nt i ffs and c las s m ember s i nvol ve the s ame conductbyt he defe ndant , t ypi cal i t yis e s t abl i s hed. ’ ” I d. at*14 ( quot i ng N ew t on , 259 F. 3d at18 3 -84 ). B as ed on thi s s t andar d, t he D i s t r i ctC our texpl ai ned:
“H er e, t he cl ai m s m ade b y named Pl ai nt i ffs and t ho se m ade on beha l f of t he Sett l em e n t C l ass M ember s ar e i ndi s t i ngui s habl e, encompas sing id e n tica l alle g a tio n s th a t th e Z u ric h D e f e n d a n ts viola ted R IC O , fede ral and st at e anti t rustl aw s, a n d t h e c o m m o n l a w o b l i g a t i o n o f f i d u c i a r y d u t y. Th e s e c l a i m s a r i s e i n e a c h c a s e f r o m th e s a me cou rs e of a ct i on t aken by t he Z uri ch D efen dan t s. C o n seq u en tly , the n am ed P lai n ti ff s’ claim s are t ypical of those bro u g h tbyt he S et t l em ent C l ass M e m b e rs a t la rg e .”
I d. W e d iscern n o erro r i n this find ing eith er. A lth o u g h w e a re sa tisf ied w ith th e D istric t C o u rt’s a n a ly sis o f th e c o m m o n a lity and typi cal i t yr equi r ement s of R ul e 23( a) , w e t h ink t hatV an E n terp rise s’ c h a llen g e to th e p re d o m in a n c e re q u ire m e n t o f R u le 23( b) ( 3) cal l s fora cl os erl ook.
A s par t of i t s chal l enge t o t he D i s t r i ct C our t ’ s fi ndi ng of pr edomi nance , V an E nt erpr i s es ar gues t hat“the Set t l i ng Par t i es a n d th e D istric t C o u rt d id n o t a d d re ss h o w a n titru st in ju ryc o u ld be s how n w i t h co m m on pr oof forthi s overbr oad Set t l ementN one of thes e part i cul arar gum ent s w as r ai sed i n V an 25 E nt erpr i s es ’ w r i t t en obj ect i on. N o nethel es s , beca us e of the m agni tude of this se tt le m ent– bot h i n t erm s of the amountof m o n e yin v o lv e d a n d th e n u m b e r o f p e rso n s a f

f e c ted – w e w ill exer ci s e ourdi s cr et i on t o cons i dert hes e ar gum ent s. T he s i gni fi canc e of thi s l i t i gat i on, i n combi nat i on w i th our i ndepende ntobl i gat i on t o ens ur e the fai r nes s of the s et t l ement f o r a b se n t cla ss m e m b e rs, p e rsu a d e s u s to e n ter tain th e se n e w ly devel oped ar gum ent s on appea l

. B utourdeci s i on t o cons t rue l i be r a l l y Van En t e rp r i s e s ’ wr i t t e n o b j e c t i o n t o e n c o mpa s s t he m or e det ai l ed r eas ons now o ffer ed fori t s chal l enge t o the 51 C l ass that i ncludes c las s m em bers w ho did not purchase i ns ur ance fr om anyI ns ur erD efe ndantorw ho ut i l i zed a br oker w ho i s noteven a l l eged t o be pa rt o f t he cons pi r acy ” and that “[d] ue t o t he overbr oad cl as s defi n it i on, even the ques t i on of w h e th e r th e re is a n a n titru st c o n sp ira c yu n d e r f e d e ra l o r sta te l aw i s notcomm on t o t he cl as s . ” V an E nt erpr i s es m akes s i m i l ar a rg u m e n ts i n th e c o n tex t o f th e p lain tiff

s’ R IC O c laim a s w e ll. B r i efl ys t at ed, V an Ent erpr i s es ar gues : “The Sett l i ng Par t i es and t he D i s t r i ctC our tdi d notaddr es s w hethert he named Pl ai nt i ffs o rS e t t l e me n tCl a s s me mb e r s h a d s t a n d i n g t o b r i n g a RI CO cl ai m , w hethert her e w as a uni form m i s r epr esent at i on or om i s s i on t o t he cl as s , w hether pr oxi m at e caus at i on and fi nanci al l os s w ere comm on t o the cl as s , orthe appl i cabi l i t yof the fi l ed r at e do ctr i ne. ” Through thes e ar gum ent s , V an Ent erpr i s es a ttem p ts to d e m o n stra te th a t co m m o n iss u e s d o n o t p re d o m in a te wi t h r e s p e c tt o t h e a n t i t ru s tc l a i ms a n d th a t“ [ i ] n d i v i d ual q u e stio n s re m a in th a t w o u ld h a v e to b e se p a ra tely a d ju d ic a te d .” 25pr edomi nance r equi r ements houl d in no w aybe i nt erpr et ed as s a n c t i o n i n g Van E n t e rp r i s e s ’ c o n d u c t

. F o rth i s r e a s o n , we rei t erat e t hat V an E n ter p ri ses s ho uld have present ed these argument s t o t he D i s t r i ctC our ts o t hati tcoul d have i ncorpor at ed su ch cons i der at i ons i nt o i t s ow n anal y s i s , and or di nar i l ycl ai m s r ai s ed i n t hi s m anner w i l l be deemed w ai ved. A d d it ion ally , w h il e w e re co g n ize tha t th e D istri ct C o u rt ’s d isc u ss io n o f

th e p re d o m in a n c e re q u ir em ent w as not part i cu lar ly det ai l ed, w e thi nk t hati t s tr eatm entof this re qui r ementw as under s t andabl e gi ven th e concl us oryobj ect i on thatV an E n terprises m ad e to p red o m inan ce . T h e D is tr ictC o u rt ’s analy si s, t ho ug h bri ef, w as m ore tho rough than V an E nterpri ses’ o b jec tio n o n th is p o in t. 52 T he pl ai nt i ffs r es pond t hat “V an’ s ar gum ent s r egar di ng com m on i m pact and co m m on i njuryi gn ore that Plai nti ffs’ c laim s a n d th e S e ttl e m e n t C las s M e m b e rs’ c laim s a re id e n tica lly predi ca ted on t he Z uri ch D efen dan t s’ act i on s” and that , as a r es ul t , “the di s t r i ctcour t ’ s fi ndi ng of pre dom i nance w as notan abus e of d iscr et i on. ” The pl ai nt i ffs al s o ar gue thatV an E nt erpr i s es ’ chal l enges t o t he m eri t s of the cl ai m s “have no r el evanc e t o t he det erm i nat i on of w hether t o cert i fy a s et t l ement cl as s . ” To t hi s ar gum ent , t he att orney s gener al ad d t hatV an E nt erpr i s es s i m pl y acc us es t he D i s t r i ct C our t of “notr ead[ i ng] enough br i efs, enough dec l ar at i ons , enough r epor t s , enough m em o ran d a, en o u g h ca ses or en o u g h ev iden ce to s u p p o rt a p p ro v a l o f

c la s s c e rt if

ic a tio n a n d s e ttle m e n t.”
T h e S u p re m e C o u rt h a s e x p lain e d th a t “[ t]h e R u le 23( b) ( 3) pr edomi nance i nqui r yt es t s w hether p ropos ed cl as s es53 ar e s uff

ici ent l ycohes i ve t o w arr antadj udi cat i on by rep rese n tat ion , ” w h ich im p o ses a stan d ard “f ar m o re d e m a n d in g ” th a n th e R u le 2 3 (a ) c o m m o n a lityre q u ire m e n t. A m chem , 5 2 1 U

. S

. at 62 3 -2 4 . W h ere as “ R u le 23 (a)(2)’s co m m o n ali tyelem en t r eq u ir es th at th e pro p o sed class m em b ers s har e atl eas tone ques t i on of fa ctorl aw i n comm on w i t h eac h ot her , ” the R ul e 23( b) ( 3) pr edomi nance el ement“r equi r es that c o m m o n iss u e s p re d o m in a te o v e r iss u e s a f f e c tin g o n ly i ndi vi dual cl as s m ember s . ” In re W arf ari n S od ium A nti trust L it ig. , 3 9 1 F. 3 d a t5 2 7

- 2 8

. Hen c e , we c o n s i d e rth e Rul e 2 3( a) co m m o n ali tyreq u ir em en t t o b e in c o rpo rated into the m o re s t r i ngentR ul e 23( b) ( 3) pr edomi nance r equi rem ent , and there fo re de em it ap p rop ri ate t o “a n aly ze the tw o f a ctors t ogether , w i t h par t i cul arfocus on the pre dom i nance r equi r ement

. ” I

d. a t 5 2 8 ; acco rd D an vers M otor C o . v
. Ford Mo tor Co. , 5 4 3 F. 3 d 1 4 1 , 1 4 8 ( 3 d Ci r . 2 0 0 8 ) ( “ [ W ] h e r e an a c tio n is to p ro c e e d u n d e r R u le 2 3 (b )(3 ), th e c o m m o n a lity re q u i r e m e n t is s u b s u m e d b yth e p re d o m in a n c e re q u ir e m e n t.” ( i nt ernal quot at i on m arks om i t t ed) )

. B eca us e cl as s cert i fi cat i on i s unsuit able w here “proof of the ess enti al el em ents of the cause o f act i on r equi r es i ndi vi dual tr eatm ent , ” N ew t on , 259 F. 3d at 172, w e w i l l “exa m i ne t he el ement s of pl ai nt i ffs ’ cl ai m thr ough the p ri sm o f R u le 23 to d eterm ine w h eth e r th e D istri ct C o u rt pr oper l ycert i fi ed the cl as s , ” In re H ydrog en P eroxi de A nti trust Li t ig. , 5 5 2 F

. 3 d at 31 1 (i n terna l qu o tat ion m ark s o m itted).
H ere , t he D i s t r i ctC our tr el i ed on i t s R ul e 23( a) comm onal it y an aly sis in asse ssi ng the pr edomi nance r e q u i r e me n to f

Rul e 2 3 ( b ) ( 3 )

. Aft e rs e t t i n g f o r t h g e n er al pr i nci pl es aboutt he p redom i nance r equi r ement , the D i s t r i ct C our t , i nt erpr eti n g pr ece dentfr om ourC our t , not ed thatW e do n o tr e a d th e Di s t r i c tCou r t ’ s s t a t e me n tas 26 im p ly ing that co m m o n issue s n ec essa ri lyp red o m inate in e v ery a n titr u s t ca s e ; su c h a p ro p o s itio n w o u ld b e in c o rr e c t. See In re H ydr ogen Perox i de Ant itru s tLi t ig. , 5 5 2 F

. 3 d a t3 2 1

- 2 2 ( “ We r ec o g n ize the S u p rem e C o u rth as o b serv ed that ‘[p ]redom i nance i s a t es tr eadi l ym eti n cert ai n cas es al legin g co ns um eror s ecur i t i es fr aud orvi ol at i ons of the ant i t rus t l aw s . ’ B uti tdoes notfol l ow t hata court s houl d r el ax i t s cert i fi cat i on anal y s i s , or presum e a requir em ent fo r cert i fi cat i on i s m et , m erel ybecau se a pl ai nt i ff’ s cl ai m s fal l w i t hi n one of t hos e s ubs t ant i ve c a teg o rie s. ” (c itatio n o m itt e d )). R a th e r w e c o n stru e th is s t atem en tt ogetherw i t h t he D i s t r i ctC our t ’ s i dent i fi cat i on of vari ou s i ssues i n the p res ent cas e t hat ar e com m on t o the cl ass. I n d o ing so, w e i nt erpr ett he D i s t r i ctC our t ’ s s t at ementas i ndi cat i ng t hat , i n t hi s cas e, gi ven the comm on i s s ues of l aw and fac t w h i ch s t em from t he conduc tof the def endant s , the p re d o m in a n c e re q u ire m e n t is n e c e ss a rilym e t. 54 “bec aus e the ‘ cl ear [] focus ’ of an ant i t rus tcl as s act i on i s ‘ on the al l egedl y d ece pt i ve conduc tof def endant ’ and noton ‘ t he conductof i ndi vi dual cl as s m ember s , ’ comm on i s s ues nece s s ar i l y pr edomi nat e. ” Z ur i ch Set t l ementFi nal A ppr oval 26 O pi ni on at*15 ( quot i ng I n r e W ar f ar i n Sodi um A nt i tr us tLi t ig. , 391 F. 3d at528)

. T he D i s t r i ctC our tthen pr ovi ded the fol l ow i ng expl anat i on i n s upport of fi ndi ng t he pr edomi nance r equi r ements at i s fi ed:
“H er e, as di s cus s ed i n the s ect i ons on c o mmo n a l i t ya n d typ i c a l i t y , th e i d e n t i c a l c l a i ms of b oth the n am ed P l ai nti ffs and the ab sentcla ss55 m e m b e r s a rise f

ro m th e sa m e se t o f f a c ts r egar di ng t he al l e g e d c o l l us i ve and ant i compet i t i ve b e havi or of t he Zuri ch D efe n d ant s . C ons equent l y , the pr edomi nance re q u ir e m e n t is s a tis f

ie d .”
I d. a t * 1 6 . In its e a rlier d isc u ss io n o f th e c o m m o n a lity r equi r ement , t he D i s t r i ct C our t l i s t ed t he fol l ow i ng as exampl es o f th e c o m m o n q u e stio n s o f law a n d f

a c t:

“ (1 ) w h e th e r th e Z u ric h D e f e n d a n ts e n ter e d in to a cons pi r acyt o al l ocat e the mar ket for t he s al e of i nsurance; ( 2) w heth e r the Z uri ch D efen dan t s’ al leged c ons pi r acyhad the purpos e and e ffe ctof unlaw fu ll y r es t r ai ni ng compet i t i on i n t he i ns ur ance i ndus t r y ; ( 3) w hethert he Zuri ch D efe ndant s ’ conductvi ol at ed Sect i on 1 of the S herm an A ct ; (4) w hethert he Z uri ch D efen dan t s’ c o n d u c t b re a c h e d th e ir f id u c iar yd u tyto th e ir cl i ent s ; and (5) w hethert he ac t i ons of the Zuri ch D e f e n d a n ts v io la te d th e R IC O s ta tu te .”
I d. at*13.
R eadi ng t he D i s t r i ctC our t ’ s com m o nal i t yand p re d o m in a n c e a n a ly se s to g e th e r, as is a p p ro p ria te in th is c o n te x t, s ee I

n r e W ar f ar i n Sodi um A nt i tr us tLi t ig. , 391 F. 3d at 5 2 8 , iti s cl eart hatt he D i s t r i ctC our ti dent i fi ed s ever al s i gni fi cant

– albei tbr oad – comm on i s s ues , even i f i tdi d not fur therr efi ne i t s anal y s i s byas s es s i ng t he i ndi vi dual el ement s of t he pl ai nt i ffs ’ cl aim s . H ow ever , as w e i ndi cat ed ea r l i er , the56 D is tr ic t C o u rt w a s n o t p re se n ted w ith a v ig o ro u s c h a llen g e to th e p re d o m in a n c e re q u ire m e n t, w h ich m a yh a v e in f lu e n c e d its deci s i on nott o pr ovi de a mor e thor ough anal y s i s o f thi s i s s ue. I n or dert o ens ur e that t he D i s t r i ct C our t appl i ed t he corr ectl egal st and ard and act ed w i t hin i t s di scr et i on i n cert i fy i ng t his cl ass, w e w i l l conducta R ul e 23( b) ( 3) pr edomi nance anal y s i s for our s el ves , bui l di ng on the founda t i on pr ovi ded b yt he D i s t r i ct C o u rt.
B eca us e ourt as k cal l s for us t o “exa m i ne the el ement s of pl ai nt i ffs ’ cl ai m t hr ough the pr i s m of R ul e 23, ” I n r e H ydr ogen P er oxide A n t i tr us tLi t ig. , 552 F. 3d at311 ( i nt ernal quot at i on m arks om i t t ed ), w e beg i n w i t h the el em ents of the plai nti ffs’ f e d e ra l an titru st c laim

. S e c tio n 1 o f th e S h e rm a n A c t p ro h ib its “[e ] verycontr act , combi nat i on i n t he form of t rus t orot herw i s e, orcons pi r acy , in res t r ai ntof tr ade orcomm er ce a m ong t he s e v e r a l St a t e s , o rwi t h for ei g n n a t i o n s . ” 1 5 U. S. C. § 1

. “ To es t abl i s h a vi ol at ion o f S ect i on 1, a pl ai nt i ff mustpr ove: (1 ) c o n c e rte d a c tio n b y the d e f e n d a n ts; (2 ) th a t p ro d u c e d a n tic o m p e tit iv e e f

f e c ts w ith in th e re lev a n t p ro d u c t a n d g e o g ra p h ic m arket s ; ( 3) t hat t he conc ert ed ac t i ons w er e i l l egal ; and ( 4) that it w a s in ju re d a s a p ro x im a te re s u lt o f th e c o n c e r t e d a c tio n .” G or don v. Lew is t ow n H os p. , 423 F. 3d 184, 207 ( 3d C i r . 2005) ( ci t i ng P etr uz

z i ’s IGA Super m arket

s , I nc. v. D ar l i ng-D el

. C o. , 998 F. 2d 1224, 1229 ( 3d C i r . 1993) )

. T he Supr eme C our thas e x p lain e d th a t S e c tio n 1 o f th e S h e rm a n A c t “‘ d o e s n o t p ro h ib it [ a ll] u n re a so n a b le r e stra in ts o f tra d e . . . b u t o n lyre stra in ts eff ect ed bya contr act , combi nat i on, orcons pi r acy , ’ ” and t her efor e “‘ [t ] he cruci al ques t i on’ i s w hetherthe chal l enged ant i compet i t i ve conduc t‘ s t em[s] fr om i ndepende ntdeci s i on or fr om an agr eement , t aci torexpr es s . ’ ” B el lA t l

. C or p. v.57 T w o m b ly , 5 5 0 U .S . 5 4 4 , 5 5 3 (2 0 0 7 ) (c itatio n s o m itt e d ); s ee G or don , 4 2 3 F .3 d a t 2 0 7 (“ T h e e ss e n c e o f a S e c tio n 1 c laim is the e x ist en ce o f a n ag ree m en t. ”).
T ur ni n g t o t he pl ai nt i ffs ’ al l egat i ons , w e cons i der w h e th e r c o m m o n q u e stio n s o f law a n d f a c t ex ist w ith re sp e c t to eac h of t hes e el ement s . B eca us e the fi r s tand thi r d el ement s of a S herm an A ctviol at i on focu s on t he con du ct of the defe nd ants , w e fi nd t hat comm on ques t i ons abound w i t h r es pectt o w hether t he defenda nt s engage d i n i l l egal , conce r t ed ac t i on. For e x a m p le, c o m m o n q u e stio n s re lev a n t to th e se tw o e lem e n ts i ncl ude w hethe rt he Zuri ch D efe ndant s agr eed w i t h anyof the B r oker D efe ndant s t o pay cont i ngent comm i s s i ons i n excha nge foran al l ocat i on of a cert ai n amount of busi nes s i n the i ns ur ance m arket , w hethert he Zuri ch D efe ndant s co n sp i r ed w i t h any I ns ur erD efe ndant s t o r educe compe ti ti on and al l ocat e the m arketam ong a s el ectgr oup of i ns ur er s , w hethert he Zuri ch D efen dan t s agreed no t t o com pete fo r other I nsurerD efen dan t s’ c u s t o me r s i n r e tu r n f

o ri n c u mb e n tp r o t e c t i o n o f th e i ro wn cus t om ers, w hethert he Zuri ch D efe ndant s s har ed a c om m on obj ect i ve of r educi ng compet i t i on among t he oth er I ns ur er D e f e n d a n ts a s o p p o se d to m e re ly e n g a g in g in p a ra llel c o n d u c t, w hethert her e w as a di s cerni bl e di vi s i on of the i ns ur ance m arket w hi ch amount ed t o an i l l egal r es t r ai ntof tr ade, and w hether t hes e agr eement s cons t i tut ed hor i zont al r es t r ai nt s of tr ade that ar e pers e i l l egal

. T he s econd e l ementof a She rm an A ct viol at i on , w hich focu ses on t he effects of the defe nd ants ’ chal l enged c onduct , al s o i nvol v es comm on ques t i ons i n t he pr es ent cas e, i ncl udi ng w hetherthe Zuri ch D efe ndant s ’ act i ons r educe d competi ti on fori ns ur ance , w hetherthe Zuri ch D efe ndant s ’ act i ons r es ul t ed i n a consol i dat i on of the i ns ur ance58 i ndus t r y , and w hetherthe Zuri ch D efe ndant s ’ act i ons pr oduced an i ncr eas e i n t he cos tof pr emi um s forcomm er ci al i ns ur ance . T he fourt h el ementof a Sher m an A ctvi ol at i on, w hi ch addr es s es w hether t he pl ai nt i ffs s uffe r ed an ant i t rus t i nj ury , i s at the c en ter o f V an E n terprises’ ch all en g e to th e D istri ct C o u rt ’s R ule 23(b)( 3) predom i nan ce fi nd ing. I n the con t ext of cl ass cert i fi cat i on s, w e hav e st at ed that“i m pact oft en is cri t i ca lly im p o rt an t fo r th e p u rpo se o f e v alua ti n g R u le 23 (b)(3 )’s p re d o m in a n c e re q u ire m e n t b e c a u se it i s a n e lem e n t o f th e c laim t hatm aycal l for i ndi vi dual , as oppos ed t o comm on, pr oof. ” In r e H ydr ogen Perox i de Ant i tr us tLi t ig. , 552 F. 3d at311. A c c o rd in g ly , fo r p u rp o se s o f c las s c e rtific a tio n p u rsu a n t to R u le 23( b) ( 3) , “th e task fo rpl ai nt i ffs

. . . i s t o demonstr at e thatt he el ement o f ant i t rus ti m pacti s capa bl e of pr oof att r i al t hr ough e v id e n c e th a t is c o m m o n to th e c las s ra th e r th a n in d iv id u a l to its m ember s . ” I

d. a t 3 1 1 -1 2 . F o r th is re a so n , alth o u g h th e f o u rth el ementfocus es on w hetherthe pl ai nt i ffs w ere i nj ur ed bythe defe ndant s ’ conduct , i tm ays t i l l i nvol ve comm on ques t i ons of l aw and fa ct i f pr oof of i nj ury can be es t abl i s hed on a c l as s - w i de basi s. V an Ent erpr i s es ar gues that an t i t rus ti nj urycannotbe proven on a cl ass- w i de b asi s bec a u se the S et t l em ent C l ass i ncl udes cl as s m ember s w ho di d notpur chas e i ns ur ance fr om an I ns ur erD efe ndantorut i l i ze a B r oker D efe ndant

. T he pl ai nt i ffs count er t hat ant i t rus t i nj ury i s a ques t i on thati s comm on t o t he cl as s beca us e “C ont i ngent C om m i s s i ons . . . ar e i ncl uded i n eac h in su re r’s ra tem a k in g f

o rm u las a n d a re c o n se q u e n tly‘b u ilt ’ in to e v e r y c o m m e r c i a l p r e m i u m f o rc o m m e rc ia l in s u ra n c e p ro d u c ts ,” and “the cons pi r at or i al conductof al l D efen d an t s ( i ncl udi ng59 Z ur i ch) r educe d orel i m i nat ed com pet i t i on fori ns ur ance pr oduc t s , t h e r e b yr a i s i n g th e i n s u r a n c e p r e mi u ms p a i d by Pl ai nt i ffs and al l m ember s of the cl as s . ” Thus, theyar gue that al l cl ass m em bers w ere i njur ed b ythe Z uri ch D efen dan t s’ ant i compet i t i ve conduc t , ev en i f the ext entof thei ri nj ur i es var i ed. T he att or ney s gener al l i kew i s e ar gue that“[c ] ont i ngent c o mmi s s i o n s p a i d b yi ns ur e r s we r e b u i l ti n t o t h e p r e mi u ms ch arg ed to m em b ers o f th e c lass w h ich re su lted in su p ra compet i t i ve pr emi um pr i ces t o i ns ur ance cons um er s , ” and that “[a ] s a resu l tof the D efe ndant ’ s conduct , Pl ai nt i ffs and u n n a m e d c las s m e m b e r s h a v e p a id in su ra n c e p re m iu m s in e x c e ss o f w h a t th e y w o u ld h a v e p a id h a d th e B ro k e r D e f e n d a n ts a c ted in a c c o rd a n c e w ith th e ir f id u c iar yd u ties a n d th e ir re p re s e n ta tio n s to th e irc lie n ts .”
A s t he ar gum ent s of the pl ai nt i ffs and at t orney s gener al i l l ust rat e, w hethert he n am ed p l ai nti ffs and abs e n t cl ass m ember s w er e pr oxi m at el yi nj ur ed byt he conduct of the Zuri ch D efe ndant s i s a quest i on t hat i s capa bl e of pr oof on a cl as s - w i de bas i s . C ont r aryt o V an Ent erpr i s es ’ asse rt i on, the Set t l ement C l as s onl yi ncl udes pol i cyhol der s w ho pur chas ed i ns ur ance di r ect l yfr om t he Zuri ch D efe ndant s and pol i cyhol der s w ho ut i l i z e d o n e o f

t h e Br o k e rDef

e n d a n t s , a n d t h e r e f

o r e t he p lain tiff s’ th e o ry f

o r pr o v in g a n titru st i n

ju ry w o u ld a p p lyto a ll o f t h e c l a s s me mbe r s . Con s e q u e n t l y , we a r e s a t i s f i e d t h at t he e lem e n t o f

a n titru st in

ju ry– th a t is , th e f

a c t o f d a m a g e s – is s us cept i bl e t o comm on pr oof, even i f t he amountof damage that eac h pl ai nt i ff s uffe r ed coul d notbe es t abl ishe d bycomm on p ro o f

. U n lik e in I

n r e H ydr ogen Perox i de Ant i tr us tLi t igat i on , w her e the ce r t i fi cat i on i nqui r yw as s etagai ns tthe bac kdr op of a n im p e n d in g trial, h e re w e a re n o t a s c o n c e rn e d w ith60 “form ul at [i ng] s om e pr edi ct i on” as t o how thi s el ementof a Sher m an A ct vi ol at i on w oul d “pl ay out ” at t r i al , 552 F. 3d at311 (i n terna l quotati o n m ark s o m itted), “fo r th e p rop o sal i s tha t th ere be no tr i al , ” A m chem , 5 2 1 U

. S

. at 62 0 , an d instead o u r i n q u iry i nt o t he el ementof ant i tru st injuryi s s ol el yfort he purpos e of ens ur i ng that i s s ues comm on t o t he cl as s pr edomi nat e over i nd i vidual on es. A s the forego i ng analy si s dem on strat es, comm on ques t i ons exi s teven w i t h r espectt o t he el ementof ant i t rus ti nj ur yand ther efor e anyi ndi vi dual i s s ues do not overw hel m t he comm on ones . B eca us e eac h of the el ement s of a Sherm an A ct vi ol at i on i nvol ves comm on ques t i ons of l aw and fac t , w e conc l ude thatcomm on ques t i ons pr edomin at e over i n d i v i d u a l o n e s wi t h r e s p e c tt o th e f e d e r a l a n t i t ru s tc l a i m. N ext, w e con si der the essent i al el em ents of the plai nti ffs’ R IC O c laim . T h e R IC O sta tu te p ro v id e s, in re lev a n t p a rt:
“I ts hal l be unl aw ful foranyper s on empl oy ed by oras s oci at ed w i t h an yent erpr i s e enga ged i n, or t he ac t i vi t i es of w hi ch affec t , i nt er s t at e orfor ei gn comm er ce, t o conductorpart i ci pat e, d ir ect l yor ind ir ec tl y , in the co n d u ct of su ch en ter p ri se’s a f f a irs th ro u g h a p a ttern o f ra c k e tee rin g a c tiv ity . . . .”
18 U

. S. C

. § 1962( c)

. E s t abl i s hi ng l i abi l i t yunderthi s s ect i on of t he R IC O st atute “requi res (1) con du ct (2) of an e n terpri se (3) thro u g h a p att ern (4) o f rac k etee ri n g ac ti v ity , ” p lus a n injury t o “bus i ness o r prope r t y . ” Sedi m a, S. P

. R

. L. v. I m r ex Co. , 473 U .S . 4 7 9 , 4 9 6 (1 9 8 5 ) ( f o o tn o te o m itt e d ); s ee Lum v. B ank of A m. , 3 6 1 F

. 3 d 2 1 7 , 2 2 3 (3d C ir

. 2 0 0 4 ). U n d er S ec ti o n 1 9 6 2 (d),61 “ [ i]t is a lso u n law f

u l f o r a n y o n e to c o n s p ire to v io late § 1962( c)

. ” Lum , 3 6 1 F

. 3 d a t2 2 3

. Se c t i o n 1 9 6 1 ( 1 ) o f RI CO p ro v id e s a li s t o f

th e f e d e ra l an d sta te c rim e s w h ich c o n stitu te “r acke t eer i ng act i vit y ” and i ncl udes m ai l and w i r e fr aud, and S e c tio n 1 9 6 1 (4 ) o f

R IC O d e f

in e s th e ter m “ e n ter p r is e ” to “i ncl ude[] anyi ndi vi dual , par t ner s hi p, corpor at i on, as s oci at i on, o r o th e r le g a l en tity , an d a n yu n io n o r g ro u p o f in d iv id u a ls a s s o c ia te d in f

a c t a lth o u g h n o t a le g a l e n tity.”
P rovi ng t he fi rs t el em ent of a R IC O viol at i on i n thi s case w oul d i nvol ve com m on ques t i ons aboutt he ac t i vi t i es of the Z ur i ch D efe ndant s and, i n par t i cul ar , w hetherthe Zuri ch D efe ndant s par t i ci pat ed orengage d i n conductw i t h other I ns ur erD efe ndant s a n d Br o k e rDef endant s . T he s econd e l ement a lso in v o lv e s c o m m o n q u e stio n s o f law a n d f

a c t, na m e ly w hetheran ent erpr i s e of Broke rD efe ndant s and I n sur er D efe ndant s exi s t ed ( of w hi ch the Zuri ch D efe ndants w er e a par t ) ei t heras an as s oci at i on i n fac toras a more form al o rg a n iza tio n o r e n tity . P ro v in g th e th ird a n d f o u rth e lem e n ts w o u ld e n c o m p a ss c o m m o n q u e stio n s o f la w a n d f a c t as w e ll, inclu d ing w h ethe r ac ti v it ies th at co n sti tute rac k etee ri n g w ere t aki ng pl ace t hr ough the ent erpr i s e ( s uch as m ai l orw i r e fr aud) and w hether t hes e r acke t eer i ng act i vi t i es w er e r ecurr i ng s uch that a p att ern co u ld b e estab li sh ed

. W h il e e stab li sh ing an injury is n o t a s co n d u c iv e to c o m m o n p ro o f b e c a u se it req u ire s th a t a pl ai nt i ff de m ons t r at e harm t o hi s p rop ert yorbus i nes s , fort he r eas ons al r eadys etfor t h i n ourdi scu ssion of t he el ementof an ti t rus ti m pact , w e ar e s at i s fi ed thatt he pl ai nt i ffs have pr es ent ed a pl aus i bl e theoryforpr ovi n g a cl as s - w i de i nj uryas a r es ul tof t he r acke t eer i ng act i vi t i es of the al l eged e nt erpr i s esA gain, “N on -Ex cess C lai m ants ” refer s t o those 27 pol i cyhol der s w ho pur chas ed a pr i m ary i ns ur ance pol i cy from or th ro u g h on e of the def end ants w hereas “E xcess C l ai m ants ” r efe r s t o th o s e p o l i c yh o l d e r s who p u r c h as ed addi t i onal i ns ur ance pol i ci es – i n exce s s of thei rpr i m aryi ns ur ance cover age – fr om or throug h o ne o f t he d efen dan t s. 62 ati s s ue her e. T hus , eac h el ementof the al l eged RICO vi ol at i on in v o lv e s c o m m o n q u e stio n s o f law a n d f

a c t.
B as ed on ouranal y s i s of th e es s ent i al el ement s of the p lai n ti ff s’ fe d era l cl aim s, w e a g ree w ith the D istri ct C o u rt ’s c o n c lu sio n th a t c o m m o n q u e stio n s o f law a n d f a c t p re d o m in a te overanyi ndi vi dual ones, and ther efor e the pr edomi nance r equi r ementof R ul e 23( b) ( 3) i s s at i s fi ed.

c. C hal l enges t o t he P l an of A l l ocat i on B o th V an E n terprises an d the Ia ad /Z o rke ss o b jectors pr es entchal l enges r el at ed t o t he Pl an of A l l ocat i on, ar gui ng t hat s ubcl a s s e s wer e n e e d e d t o ens ur e ade quat e r epr es ent at i on forthe var i ous t ypes of pol i cyhol der s and t o ens ur e a fai r al l ocat i on of the s ett lem en t fu n d

. S p ec ifi ca ll y , the Ia ad /Z o rke ss o b jectors a rg u e t hat the D i stri ctC ou rtabu sed i t s di scr et i on byfai l i ng to re q u ire th e e sta b lish m e n t o f su b c las se s a n d se p a ra te repr esent at i on fo r t he E xcess and N on -Ex cess C l ai m ants

. 27 T h e y a ls o c o n ten d th a t “n o in f o rm a l p ro c e d u re s d e sig n e d to m im ic su b -classing w e re e m p lo y e d ” a n d “ th e in c re a s e d re c o v ery of one s ub- cl as s w as achi eved at the expe ns e of a not hers ubc las s’ d im in ish e d re c o v e ry .” V a n E n ter p r ise s a rg u e s th a t,A lth o u g h V a n E n terp rise s a rg u e s t h a t “ [ t]h e re is 28 s i gni fi cant d i s par at e tr eatm ent ” betw een the thr ee gr oups that r es ul t s fr om t he Pl an of A l l ocat i on, V an Ent erpr i s es does not sp e c if y w h y th e se ttl e m e n t is n o t f a ir, re a so n a b le, a n d a d e q u a te fo r an yp arti cu lar typ e o f p o li cy h o lder. 63 beca us e notal l of the cl as s m ember s pu r chas ed i ns ur ance di r ect l yfr om t he Zuri ch D efe ndant s, the cl as s m ember s have ant agoni s t i c i nt er es t s and s houl d notbe r epr es ent ed byone s et of l aw y er s . I ns t ead, acc or di ng t o V an Ent erpr i s es , s ubcl as s es sh o u ld hav e be en ce rt ifi ed an d , as a r esu lt o f th e D istri ct C o u rt ’s deci s i on nott o r equi r e s ubcl as s es and s epar at e r epr es entat i on, the P lan o f A ll o ca ti o n w as n o t fair. 28

T h e p la in ti f

f s r e s p o n d th a t t h e r e a r e n o d iv e r g e n t in ter e sts am on g the cl ass m em bers b ecause “[t ]he g roups fo r i ntr a-cl ass al l ocat i on w er e cr eat ed sol el y for economi c re as ons t o pr ovi de a fa i rdi s t r i but i on of the Sett l ementpr ocee ds am o n g t he Set t l ementC lass M ember s , ” and e xpl ai n t hat“[t ] he r el i ef w as t ai l or ed t o t he i ndi vi dual pol i cyhol der s ’ ci r cumst ance s , and the s tru c tu re o f

th e d istri b u ti o n d o e s n o t c re a te in tr a -c la s s c o n f lic ts .” T heycont end that “[t ] he Set t l ement C l as s M ember s ar e al l i n the sam e p o sit ion v is- a-v is th e Z u ri ch D ef en d a n ts; th eyare pol i cyhol der s t hat w er e ham per ed by t he same al l eged a ct i vi t i es engage d i n byt he Zuri ch D efe ndant s . ” M or eover , t heydefe nd t he P l an o f A l l ocati on byargui ng that i t “w as prepared byC l ass C ouns el , wi th t he s ubs t ant i al as s i s t ance of ec onom i c expe r t s and th e In ter v e n o r A tto rn e y s G e n e ra l, in su c h a w a ya s to f a irly a llo c a te th e re c o v e rya m o n g S e ttl e m e n t C las s M e m b e rs in acc or dance w i t h Pl ai nt i ffs ’ theor i es of pot ent i al damages i n the64 A ct i on. ” They m ai nt ai n t hat t he obj ect or s “fa i l t o r ecogni ze that t he P l an of A l l ocat i on i s des i gned t o r efl ectcert ai n di ffe r ence s i n t h e i mpa c to f

t h e Def e n d a n t s ’ c o n d u c ti n c e r t a i n l i n e s of in s u ra n c e d u ri n g d if

f e re n t yea rs .”
T he att or ney s gener al al s o ar gue t hat s ubcl as s es w er e not nece s s ary i n t hi s s et t l ement and t hat t he Pl an of A l l ocat i on w as f a ir

. T heycon t end that the o bject ors ar e essent i a lly “compl ai n[i ng] t hat t he compar at i vel y w eak cl ai m s rec ei ve compar at i vel yl es s economi c r edr es s ” and that“[t ] hi s typ e of di s par i t y i s comm on i n cl as s cas es w i t houtestabl i s hi ng s ubcl as s es . ” A dd i t i o n a l l y , th e a tt orney s gener al s t at e: “Paym ent among cl as s m ember s w i l l varydependi ng on the t ype of i ns ur ance p o li cy t heypur chas ed, butthattype of va r i at i on has neverbeen he l d t o w arr ants ubcl as s es , es peci al lyw her e the var i at i on i n paym ent i s bas ed on t he var i at i ons i n t he s t r ength of c a s e s i n v o l v i n g p a r t i c u l a r i n s u r a n c e p r o d u c t s . ” T h e a t t o r n e ys gener al al s o as s er tt hatbecaus e “the pur chas er s of exc es s and n o n -ex ce ss i n su ran ce are all k n o w n , h av e b ee n n o ti ce d an d are t he s ame per s ons , ” t hi s cas e i s di s t i ngui s habl e fr om othercas es i n w hi ch s ubcl as s es w er e r equi r ed. I n s um , t he att orney s gener al as s er tt hat“ther e ca n be no need fors ubcl as s es w her e the d i f f e r e n c e i n v o l v e d d i f

f e r e n tc l a i m s b ym a n yo f t h e s a me p e rs o n s .”
Feder al R ul e of Ci vi l Pr ocedur e 23( c) ( 5) s t at es that

“ [ w ]h e n a p p ro p ria te, a c las s a c tio n m a yb e d iv id e d in to s u b c l a s s e s t h a ta r e e a c h tr e a t e d a s a c l a s s u n d e rth i s ru l e . ” An advi s or ycomm i t t ee not e forR ul e 23( c) i ndi cat es t hats ubcl as s es ar e appr opr i at e “[ w ] her e a c l as s i s found to i ncl ude s ubcl as s es di ver genti n i nt er es t

. ” A ccor di ngl y , “[ a] di s t r i ctcourthear i ng65 a c las s a c tio n h a s th e d isc re tio n to d iv id e th e c las s in to s ubcl as s es and cer t i fyeac h s ubcl as s s epar at el y . ” I n r e C endant Cor p
. S e c
. Li t ig. , 4 04 F. 3d 173, 202 ( 3d C i r . 2005)

. W e have e x p lain e d th a t th e o p tio n to u til ize su b c las se s “ is d e sig n e d to pr eventconfl i ct s of i nt er es ti n cl as s r epr es ent at i on. ” I d. N onethel es s , “[w ] hi l e sub clas s es can be us eful i n pr event i ng confl i ct s of i nt er es t, t heyhave thei rdr aw backs

. ” I d. ( ci t i ng a se c o n d a ryso u rc e f

o r th e p ro p o sitio n th a t s u b c las sin g c a n c re a te a “ B a lk a n iza tio n ” o f

th e c las s a c tio n a n d p re se n t a h u g e o b sta c le to se t t l ementi f ea ch s ubcl as s has an i ncent i ve t o hol d outfor m o r e m o n e y)

. B e c a u s e “ t h e d e c i s i o n w h e t h e rt o c e r t i f y a subclas s requi res a balanci ng of cost s and ben efi t s t hat can best be per form ed bya di s t r i ctj udge, ” w e ac cor d s ubs t ant i al d e f e re n c e to d istric t co u rts w ith re sp e c t to th e ir re so lu tio n o f th is is s u e . I d. ; s ee A l exande rv. G i no’s , I nc. , 621 F. 2d 71, 75 ( 3d C ir. 1 9 8 0 ) (n o tin g th a t “th e d istric t co u rt h a s c o n sid e ra b le dis cret i on i n u t i l i zi ng subclas ses” u n d e r R ule 23(c) ). T hu s,

“ [ w] h e r e t h e d i s t r i c t c o u r t h a s d e c l i n e d t o c e r t i f y a s u b c l a s s , we w i l l ordi nari l ydefe r t o it s deci si on un l ess i t con st i tuted an ab use of di s cr et i on. ” I

n r e C endant

C or p. Sec. Li t ig. , 404 F. 3d at202; cf

. I n r e Prudent i alI

ns
. C o. , 148 F. 3d at 316 ( expl ai ni ng thatt he obj ect or had “ no tdem on strat ed that[on e t ype o f] cl ai m ants di ffe rfr om ot hercl as s m ember s s o as t o r equi r e the cr eat i on of a s ubcl as s , ” and con cludi ng t hat“[b] eca us e the [one type of] cl ai m ants di d notr equi r e s peci al i zed ordi s t i nctt r eatm ent , t he c o u rt’s f a ilu re to c re a te a se p a ra te su b c las s f o r th o se c laim a n ts

. . . w as n o t an a b u se o f d iscreti o n ”).
U ndert he ci r cumst ance s of t hi s cas e, w e cannot s ayt hat th e D istric t C o u rt a b u se d its d isc re tio n in re f u sin g to c re a te s ubcl as s es or r equi r e s epar at e r epr es ent at i on. W e ac know l edge66 t h at the obj ect or s ’ ar gum entt hats ubcl as s es s houl d have be en ut i l i zed ha s s om e appea l t o i t , gi ven t hat t he Pl an of A l l ocat i on di vi des t he t ot al s et t l ementaw ard o n t he bas i s of the type of i ns ur ance , t her ebycr eat i ng di ffe r entgr oups forthe p u rpose of r ei m bur s ement , an d the gr oups do nothave a cce s s t o an equa l per cent age of

t he fund. B ut s ubcl as s es ar e onl ynece s s aryw hen m ember s of the cl as s have di ver genti nt er es t s and t he D i s t r i ct C our t found t hat no s uch di ver genti nt er es t s exi s t ed betw een the al l ocat i on gr oups . T he D i s t r i ct C our t expl ai ned that the o b jectors

“ f a ile d to ra is e , le t a lo n e d e s c ri b e , any di ver gent or antagon i st i c i nter est s betw een the three group s, as i s r equi r ed i n or der f o r subcl as s es t o be m andat ed. I ns t ead, [the obj ect or s ] s t at e[] w i t hout expl anat i on t hatt hes e gr oups have ‘ cl ai m s of vary i ng m er i t ’ – a s t at ementthatappea r s t o have been deri v ed ent i r el yfr om t he fa ctt hatt he S e ttl e m e n t’s p lan o f

a llo c a tio n h a s c h o se n to di s t r i but e di ffe r entper cent ages of t he s ett l ement m o n ie s to th e s e g ro u p s .”
Z ur i ch Set t l ement F ina l A ppr oval O pi ni on at*18 ( ci t at i on om i t t ed)

. T he D i s t r i ct C our t r eas oned t hat s i m pl y bec au se the re lief v a rie d a m o n g th e d if

f e re n t g ro u p s o f

c las s m e m b e rs d id n o t d e m o n stra te th a t th e re w e re c o n f lic tin g o r a n tag o n istic i nt er es t s w i t hi n t he cl as s . T he D i s t r i ctC ourt ’ s anal y s i s of the adequa cy of r epr es ent at i on r equi r ementof R ul e 23( a) pr ovi des addi t i onal s uppor tfor i t s concl us i on t hat t her e ar e no di ver gent i nt er es t s among t he cl as s m ember s . I n t hi s cont ext , t he D i s t r i ct C our tfound that67 “itis cl ea r th at th e n am ed P lai n ti ff s’ i n terests are no tan tag o n i st i c t o those of the absent cl ass m em bers. T he cen t ral q u e sti on s i n thi s case rega rdi ng the Z uri ch D efen dan ts’ a lleg e d c o n d u c t, and the i m pact of t hatconducton bot h the named Pl ai nt i ffs and t he abse nt cl as s m ember s , ani m at es in a n id e n tica l f

a sh io n th e c laim s o f b o th gr oups . . . . Pl ai nt i ffs have a dvocat ed as vi gor ous l yfort he ab sen tcl as s m ember s as t hey h a v e f o r t h e m s e lv e s .”
I d. at*15.
M o re o v e r, o n a p p e a l, th e o b jec to rs s til l f

a il t o a rticu late how t he i nt er es t s of the var i ous m ember s ar e di v ergent , and i ns t ead theycont i nue t o poi ntt o the fa ct that the fund w as al l ocat ed i n s u ch a w aythata gr eat erper cent age of the s et t l ement val ue i s des i gnat ed for cl as s m ember s w ho pur chas ed e x c e ss in su ra n c e d u rin g c e rta in y e a rs. H o w e v e r, th is i s s im p ly a re flec ti o n o f th e ex tent o f the in jurythat ce rt ain c lass m em b ers i ncurr ed and doe s notcl ear l ys ugges tt hatt he cl as s m ember s had ant agoni s t i c i nt er es t s . A ddi t i onal l y , as the att orney s gener al em ph asi zed at oral a rg um ent, m anyof the S et t l em ent C l ass M ember s ar e bo th E x ces s and N on- E xces s pol i cyhol der s and w i l l be ent i tl ed to r ecove rdamages foroverpaym entof pr emi um s fo r b ot h t ypes of i ns ur ance . T hi s i l l us t r at es thatthe Pl an of A l l ocat i on di d not cr eat e de fac t o s ubcl as s es among t he cl as s m em ber s butm er el ycr eat ed a s t ructur e forens ur i ng t hat r ei m bu r s e me n t i s t i e d t o t h e e x t e n t o f d a ma g e s i n c u r r e d on cert ai n p o li ci es of i ns ur ance . T hi s m ethod fordi s t r i but i ng t he fund, i n w hi ch i ndi vi dual s and ent i t i es m ay h av e cl ai m s t hat68 s pan s ever al of the al l ocat i on gr oups , d id notpr oduce a d iverg en c e o f in terests am o n g the c lass m em b ers. R athe r, r egar dl es s of the t ype of i ns ur ance at i s s ue and the t i m e per i od dur i ng w hi ch i t w as pur chas ed, al l of the cl as s m ember s s har ed a u n if ied in ter e st in e sta b lish in g th e Z u ric h D e f e n d a n ts’ lia b ili ty forengagi ng i n an t i compet i t i ve conduc tw hi ch i ncr eas ed the costof p rem i um s for al l po l i cyho l ders.
A ddi t i onal l y , t he D ist r i ctC our tfound thatthe Zuri ch S ett lem en t A g ree m en t and the P lan o f A ll o ca ti o n w ere fa ir , r eas onabl e, and adequat e, and i n s uppor tof thi s fi ndi ng cr edi t ed t he r epr es en tat i on of the att orney s gener al t hatt he Pl an of A l l ocat i on “ac cur at el yr efl ect s di ffe r ence s i n t he i m pactof the D efe ndant s ’ conducti n ce rt ai n l i nes of i ns ur ance dur i ng di ffe r enty ear s . ” I

d. a t * 1 1

. A s th e p lain tiff s e x p lain e d in th e ir m emora ndum i n s uppor t of t hei r m ot i on for fi nal appr oval of the se ttl e m e n t,

“ [ f ]o r e a c h g ro u p o f

c laim a n ts, th e d istrib u tab le amount fr om t he C om bi ned Sett l ementA m ount w ill b e c a lcu late d b yd iv id in g th e p re m iu m p a id byeac h cl ai m ant for t he appl i cabl e pol i ci es byt he to tal p re m iu m s p a id b ya ll cla im a n ts

. . . . W ith r es pectt o anySet t l ementC l as s Poli cy Pur chas e, no C ons pi r acyC l ai m antcan rec overa hi gher perc ent age of

t he pr emi um pai d than that recovered byan E xcess C l ai m ant ora N on -Ex cess C l ai m ant

. I n addi t i on, t o t he ext entt hatany of the C om bi ned Set t l ementA m o untal l ocabl e t o t he C ons pi r acyC l ai m ant s i s notdi s t r i b u te d, t hat r e ma i n i n g a mou n ts h a l l b e r e a l l o c a t e d t o t he69 E xcess C l ai m ants and t he N on -Ex cess C l ai m ants , w i t h 6 2. 7% al l ocated t o the E xcess C l ai m ants , and 37

. 3% al l ocated t o the N on -Ex cess C la im a n ts .” ( Z ur i ch A pp. 2906. ) T hi s i nform at i on fur t herdemonstr at es t hat th e P lan o f

A llo c a tio n w a s c a re f

u llyd e v is e d to e n su re a f a ir di s t r i but i on of the s et t l ementfund t o the var i ous types of claim an ts an d w as all o ca ted i n su ch a w ay that p o licyh o lders who l i k e l yi n c u r r e d t h e mos td a ma g e a r e e n t i t l e d t o a l ar ger p ro p o rtion o f t he recov erythan tho se w ho se i njur i es w ere l ess s ever e. E ven i f s om e pot ent i al benef i t s m ayhave be en r eal i zed fr om ut i l i zi ng s ubcl as s es , i t i s not at al l cl eart hatt he adva nt ages w o u ld h a v e o u tw e ig h e d th e d is a d v a n tag e s, a n d th e re f o re it i s di ffi cu lt to sa yt hatt he D i s t r i ctC our tabus ed i t s di s cr et i on by nott aki ng t hi s s t ep. C ons equent l y , w e concl ude t hat t he D i s t r i ct C o u rt ’s de cisi o n n o t t o c e rt ifysep ara te su b classe s o r req u ir e s epar at e r epr es ent at i on di d not cons t i tut e an abus e of di s cr et i on and l i k ew ise i t s appr oval of the Zuri ch Sett l ementA gr eement and Pl an of A l l ocat i on w as al s o w i t hi n i t s di s cr et i on.

C . C hal l enges t o t he A pproval of t he G al l ag he r Se t t l e m e nt
1 . T h e D istr ict C o u r t’s A n a ly sis
I n t he G al l agherSet t l ement , the D i s t r i ctC our tut i l i zed t he s ame appr o ach i tus ed i n appr ovi ng the Zuri ch Sett l ement w i t h respectt o the R u le 2 3 requir em ents for app rovi ng cl ass act i on s ett lem ent s . T he D i s t r i ctC our taddr es s ed the pr er equi s i t es of R ul e 23( a) and concl uded t hatthe exi s t ence of70 over288, 0 0 0 pot ent i al cl as s m ember s “ea s i l ys at i s fi es t he n u m e ro sityre q u ire m e n t [ o f su b se c tio n (a )(1 )], a s n u m b e rs in exce s s of for t y , par t i cul ar l y t hos e exc eedi ng one hundr ed orone th o u sa n d h a v e su sta in e d th e re q u ire m e n t”; th e c o m m o n a lity requi rem ent of subsect i on (a) (2) w as “cl earl ysat i sfi ed” b ecause o f th e “ m a n yc o m m o n q u e stio n s o f law a n d f

a c t”; th e typ ica lity r e q u i r e me n to f

s u b s e c t i o n ( a ) ( 3) w a s me tb e c a u s e “ t h e c l a i ms m ade bynamed Pl ai nt i ffs and thos e made o n b eh al f of the Set t l ementC l as s M ember s ar e i ndi s t i ngui s habl e, encompas s i ng i dent i cal al l egat i ons ” and s uch cl ai m s ar os e “i n eac h cas e fr om t he s ame cour s e of ac t i on t aken bythe G al l agherD efe ndant s ”; and the adequ ac yof r epr es ent at i on r equi r ementof s ubs ect i on (a )(4 ) w a s m e t b e c a u se C la s s C o u n se l w e re “ c lea rlyw e ll qual i fi ed and e xper i ence d cl as s act i on at t orney s w ho have be en i nvol ved i n s i m i l ar. . . li ti g at i on ar ound t he countr y , ” and becau s e “i ti s cl eart hatt he named Pl ai nt i ffs ’ i nt er es t s ar e not ant agoni s t i c t o t hos e of t he abs entcl as s m ember s . ” G al l agher Set t l ementFi nal A ppr oval O pi ni on at *9- 11 ( i nt ernal quot at i on m ark s o m itted).
W ith resp ec t t o R u le 2 3 (b)(3 ), the D istri ct C o u rt con cl ud ed thatt he p redom i nan ce r equ i rem ent w as m etbecau se “the i dent i cal cl ai m s of both t he nam ed P l ai nt i ffs and the abs ent cl as s m ember s ar i s e fr om t he s ame se tof fa ct s reg ard i ng t he al l eged c ol l us i ve and ant i compet i t i ve behavi or of the G al l agher D efe ndant s . ” I

d. at*12. T he D i s t r i ctC our tal s o det erm i ned t hatt he s uper i or i t yr equi r ementof R u l e 23( b) ( 3) w as s at i s fi ed byt he cl as s act i on i n l i ght of the pr es ence of m or e than 288, 000 po t enti al c las s m em bers and m i l l i on s of pa ges of do cum ents , w hi ch, acc or di ng t o t he D i s t r i ct C our t , m ade i t“more des i r abl e”T h e su p p lem e n tal P r udent i alfact ors r el evan there al so 29
w e ig h in f

a v o r o f th e G a lla g h e r S e ttle m e n t. See sup ra not e 17 ( quot i ng I

n r e Prudent i alI

ns
. C o. , 148 F

. 3 d at 323) ( not i ng fac t or s t hatm aybe appr o p ri at e t o cons i deri n addi t i on t o the ones enumer at ed i n G i rsh )

. Pr i ort o t he s et t l ement , “[c ] ouns el forthe Pl ai nt i ffs obt ai ned appr oxi m at el y70 m il li o n pages of document s fr om var i ous defe ndant s and thi r d part i es , i ncl udi ng ro u g h ly1 .4 m ill io n p a g e s o f d o c u m e n ts a n d v o lu m e s o f d a ta fr om t he G al l agherdefe ndant s al one. D ur i ng t hi s p eriod, Pl ai nt i ffs ’ couns el al s o m etand conf err ed w i t h defe ns e couns el num er ous t i m es and conduc t ed appr oxi m at el y181 depos i t i ons i n connec t i on w i t h t he a ct i on. ” G al l agherSet t l ementFi nal A p p r o v a l O p i n i o n a t* 2 ( c i t a t i o n o m i t t e d )

. A c c o r d i n g l y, couns el had an e xt ens i ve opportuni t yt o as s es s the mer i t s of the cas e. I n addi t i on, cl as s m ember s had a ri g h tt o optout , and so m e did so

. S ee i d. at*5. T he obj ect or s do notdi s put e the fai rnes s of th e aw ar d of att orney s ’ fee s on appea l , butt he D i s t r i ctC our tappr oved i t as fai r and r eas onabl e, and w e fi nd no re a s o n to d o u b t it s ju d g m e n t. N o r d o w e se e c a u se to d isp u te 71 t o li t i gate these cl ai m s i n o ne acti on , rather than i n “n um erous, s epar at e ac t i ons l i t i gat i ng the s ame i s s ue. ” I d. at*13.
T he D i s t r i ctC our tal s o co ncl uded thatthe Set t l ement A g ree m en t sat isfied R u le 23 (e) b ec au se th e a g ree m en t w as f air, re a so n a b le, a n d a d e q u a te. T h e D istric t C o u rt re a c h e d th is concl us i on aft eranal y zing ea ch of the G i rsh fac t or s and d e ter m in in g th a t th e f

irst f iv e f a c to rs “ o v e rw h e lm in g lyw e ig h in fa v o r o f ap p rov al o f sett lem en t” an d the fina l f o u r f ac tors “w ei gh s l i ght l yorm oder at el yi n favorof appr oval

. ” I d. at*4. 29th e f a ir n e s s o f

th e c la im s -p ro c e s s in g p ro c e d u re . See i d. at*15 (rejecti n g o b

jecti o n s to the p rop o sed claim fo rm ).

72 Pr i ort o cert i fy i ng t he cl as s and appr ovi ng t he G al l agher Set t l ementA gr eement , the D i s t r i ctC our taddr es s e da n d r ej ect ed t he ch al l eng es r ai sed bythe tw o o bject ors. 2. V an E nt erpri s es ’ A rgum ent s on A ppeal
A s p re v io u sly m e n tio n e d , V a n E n terp rise s is th e o n ly o b jec to r-a p p e llan t w ith re sp e c t to th e G a llag h e r S e ttl e m e n t. V an Ent erpr i s es pr es ent s near l yi dent i cal cha ll enges t o t he D istri ctC ou rt ’s app roval of the G al l agh er Set t l em ent as i tdid w i t h r e s p e c tt o t h e Zu r i c h Se t t l e me n t , a r g u i n g th a tth e n a med pl aint i ffs l ack s t andi ng, t he Sett l ementC l as s i s overbr oad and t he ce r t i fi cat i on r equi r ement s of R ul e 23( a) and ( b) ( 3) w er e not sati sfied , an d the P lan o f A ll o ca ti o n is no t fair.

a. C hal l e nge s t o t he Pl ai nt i f f s ’ St andi ng U nl i ke the Z ur i ch S et t l ement , V an E nt erpr i s es di d obj ect i n w r i t i ng t o t he G al l agher Set t l ement on the bas i s of the named p lai n ti ff s’ l ac k o f st an d ing , an d there fo re th ese arg u m en ts w ere cons i der ed byt he D i s t r i ct C our t

. T he D i s t r i ct C our tfound that

“ [ t] h e n a m e d P lain tiff

s h e re h a v e su f

f icie n tlya lleg e d in

ju ryin fac t– ar t i fi ci al l y i nfl at ed i ns ur ance pr emi um s – as a r es ul tof the G al l agherD efe ndant s ’ part i ci pat i on i n t he al l eged c us t om er al l ocati on schem e and otheral l eged con du ct , ” and that , as a re su lt, “ u n n a m e d P lain tiff s in th e c las s n e e d n o t m a k e a se p a ra te73 sh o w in g o f

in ju ryin f a c t, an d sta n d in g is n o t an o b sta c le to cert i fi cat i on fort he cl as s fors ett l ementpurpos es . ” I d. at*14.
V an Ent erpr i s es cont ends that “the named pl ai nt i ffs do n o t al lege an d h av e n o t sho w n that an yo f th eir po li cies w ere s ubj ectt o t he i m pr oper u se of cont i ngentcomm i s s i on agr eement s ” and t hat “[n] one of the named pl ai nt i ffs cl ai m that t he r ece i pt of cont i ngent comm i s s i ons caus ed anybr okert o s t eer t h e m t o a p o l i c y t h a t c o s t mor e t h a n i t s h o u l d h a ve. ” V an E nt erpr i s es ar g u es that , atbes t , t he pl ai nt i ffs as s ertt hatt hey have s t andi ng beca us e “the I ns ur erD efe ndant s ‘ pas s ed thr ough’ t heir pay m ents of con t i ng ent co m m i ssi on t o all of thei r i nsureds, r egar dl es s of the geogr aphi c ar ea ort he l i ne of c om m er ci al i ns ur ance ” and thatt hi s am o u n ts t o a non- par t i cul ar i zed a nd c o n j e c tu r a l a l l e g a t i o n o f

i n j u r y. T h e d e f e n d a n ts re sp o n d th a t V a n E n terp rise s’ a rg u m e n ts are u n av ail ing b ec a u se “ three d iffe ren t nam ed class m em b ers pur chas ed i ns ur ance cover age thr ough G al l agherthati ncl uded p o lic ie s is su e d b yD e f e n d a n t In su re rs w h o h a d e n ter e d in to con t i ng ent com m i ssi on agreem ents w i t h G al l agh er, ” and “t hese named p lai n ti ffs w er e i ndi vi dual l yharm ed bythe exi s t ence of undi s cl os ed c ont i ngentcomm i s s i ons . ” The pl ai nt i ffs add that “b ec au se th e S ett lem en t C lass is l im it ed to tho se p o li cy h o lders w i t h a ‘ d i r e ctand i m m edi at e r el at i ons hi p’ t o a B r okerD efe ndant co-con spi rat or in t his A ct i on , and becau se all S et t l em ent C l ass M em bers purchased insur ance a tpri ces el evated byD efen dan t s’ unl aw ful s cheme, al l m ember s of the S ett l ementC l as s have s t andi ng and have been i nj ur ed by t he ant i compet i t i ve conduc t des cr i bed i n t he C om pl ai nt s . ” The pl ai nti ffs als o cont end that t hey“have s uffered i m m edi at e conc r et e ec onom i c harm – an74 out

- of- pocket cos t – at t he poi nt they pur chas ed thei ri ns ur ance p o lic ie s th ro u g h th e B ro k e r D e f e n d a n ts .”
B eca us e the pl ai nt i ffs al l eged tha ts ever al of the named pl ai nt i ffs ut i l i zed the G al l agher D efe ndant s ’ br oker age s ervi ces i n or dert o obt ai n i ns ur ance and that the pl ai nt i ffs s uffe r ed economi c harm i n t he form of hi gher pr emi um s as a r es ul tof the defe ndant s ’ ant i compet i t i ve conduct , the named pl ai nt i ffs have s t andi ng for purpos es of t he cl as s cert i fi cat i on. T he al l egat i ons demonstr at e t hat t he named pl ai nt i ffs s uffe r ed an i nj uryi n fac t th a t is c o n c re te a n d p a rticu lar ize d a n d w h ich w a s p ro x im a tely c a u se d b yth e a c tio n s o f th e G a llag h e r D e f

e n d a n ts, a n d th is is suffici ent t o est abli sh t heir st and i ng . W e do no tneed t o assess t he mer i t s of the pl ai nt i ffs ’ ar gum entthat , havi ng pur chas ed i ns ur ance athi gher p ri ces , al l of the cl as s m ember s have s t andi ng, beca us e the cr i t i cal ques t i on i s w hetherthe named pl ai nt i ffs w ho w er e ac tual ly b ef or e the D i s t r i ctC our thad sta n d in g irre sp e ct i ve o f w hether e a c h a b se n t cla ss m e m b e r c o u ld es t abl i s h s t andi ng. T he named pl ai nt i ffs onl yneede d t o al l ege that t hey suffered an i njury i n fact and w ere no t require d to p ro v e th e m e rits o f

th e ir c a se a g a in st th e G a llag h e r D e f e n d a n ts t o es t abl i s h s t andi ng. A ccor di ngl y , w e concl ude thatthe D i s t r i ct C our tc o r r e c t l yd e t e r mi n e d th a tth e n a me d p l a i n t i f f s h ad s t andi ng and thatt he ca s e coul d pr ocee d.

b. C hal l enges t o C l as s C ert i f i cat i on V an Ent erpr i s es ’ chal l enges t o t he ce r t i fi cat i on of the G al l agherSet t l ementC l as s m i m i c i t s ch all enges t o the cert i fi cat i on of the Z uri ch S et t l em ent C l ass. In gene ral t erm s, Va n En t e rp r i s e s a r g u e s : “ A r e v i e w o f t h e p l e a d i n g s , RI CO75 s t at ement , or der s of di s m i s s al and ar gum ent s and evi d ence su b m itt e d b y t h e S e ttl in g P a rties in f a v o r o f c e rtifyi n g th is Set t lem entC l as s m ake c l eart hatt hi s i ncr edi bl ybr oad S e ttle m e n t C l a s s d o e s n o t m e e t th e re q u ir e m e n ts o f R u le 2 3 .” M or e s p e c i f

i c a l l y , Van En t e rp r i s e s c o n t e n d s t h a tt he pr edomi nance r equ ir em entof R ul e 23( b) ( 3) w as notm et beca us e “c om m on ques t i ons di d notpr edo m ina t e fort he ant i t rus tcl ai m s ” and “ ant i t rus ti m pactori nj uryco u ld n o tbe s how n w i t h comm on p roof. ” A s forthe R I C O cl ai m s , V an E n te rpr i s es ar gues t he pr edomi nance r equi r ementi s notm et b e c a u se “ th e re w e re n o t sta n d a rd , u n if o rm m isre p re se n tatio n s to t he cl as s ” a n d i tw as ques t i onabl e “w hetheranyvi ol at i on of R I C O caus ed l os s t o t he cl as s . ” V an Ent erpr i s es al s o ar gues t hat t he D i s t r i ctC our t , by“appl [y i ng] the comm onal i t ys t andar d of [R ul e] 23( a) ( 2) t o det erm i ne w hetherques t i ons of l aw orfac t comm on t o t he mem ber s o f the cl as s pr edomi nat e overany ques t i o n s a f

f e c t i n g o n l yi ndi vi dual m ember s , ” us ed the i ncorr ect l e g a l s t a n d a r d i n ma k i n g i t s Ru l e 2 3 ( b ) ( 3 ) d e t e r mi n a t i o n . As t hes e cha l l enges w er e pr es erve d in V an Ent erpr i s es ’ w r i t t en obj ect i on, w e w i l l cons i dereac h of them i n turn. A lth o u g h V a n E n terp rise s’ a rg u m e n ts a re p rim a r ily f o c u s e d o n t h e p r e d o mi n a n c e r e q u i r e me n to f Ru l e 2 3 ( b ) ( 3 ) , we w ill b ri efl yadd re ss th e c o m m o n a litya n d typ ica lityre q u ire m e n ts o f R u le 2 3 (a ) a s it sp e c if

ica lly c h a llen g e d th e se re q u ire m e n ts in i t s w r i t t en obj ect i on. T he D i s t r i ctC our tfound thatt he comm onal i t yr equi r ementw as s at i s fi e d beca us e “ther e ar e many com m on qu est i on s of l aw and fac t, ” l i st i ng , am on g o t hers, ques t i ons s uch as w hether“the G al l agherD efe ndant s ent er ed i nt o a contr act , combi nat i on orcons pi r acyt o al l ocat e the mar ket f o r sa le o f

in su ra n c e ” a n d w h e th e r “ th e G a lla g h e r D e f e n d a n ts76 engage d in a pat t ern of r acke t eer i ng act i vi t y . ” G al l agher Set t l ementFi nal A ppr oval O pi ni on at*10. B eca us e the comm onal i t yr eq u i r ementi s “s at i s fi ed i f the named pl ai nt i ffs s har e atl eas tone ques t i on of fa ct or l aw w i t h the gr i evanc es of t he pr os pect i ve cl as s , ” N ew t on , 259 F. 3d at183 ( i n t ernal quot at i on m arks om i t t ed), w e do notdi s cern anyerr ori n the D i s t r i ctC our t ’ s fi ndi ng t hatthe comm onal i t yr equi r ementw as sati sfied

. A s fo r t h e typ icali tyreq u ir em en t, the D istri ct C o u rt found that
“t he clai m s m ade b ynam ed P l ai nti ffs and tho se m ad e o n b eh alf o f th e S ett lem en t C lass M em b ers ar e i ndi s t i ngui s habl e, encompas s i ng i dent i cal al l egat i ons t hatth e Gal l a g herD efe ndant s vi ol at ed R I C O , fede r al and s t at e ant i t rus tl aw s, and t he c o m m o n law o b lig a tio n s. T h e se c la im s a rise in eac h cas e fr om t he same cour s e of act i on t aken by t he G al la gherD efe ndant s . C ons equent l y , the nam ed P l ai nti ffs’ cl aim s ar e t ypical of those br oughtbyt he Set t l ementC lass M ember s at la rg e .”
G al l agher Set t l ement Fi nal A ppr oval O pi ni on at *11. W e agr ee w i t h t he D i s t r i ctC our tt hat the claims of the named pl ai nt i ffs and the cl as s m ember s s t em fr om t he conduc tof the G al l agher D ef en d an ts an d that the in tere s ts o f th e n am ed p lai n ti ff s are s uffi ci ent l y al i gned w i t h the i nt er es t s of the ent i r e cl as s s uch that the typ icali tyreq u ir em en t i s satisfied. A cc o rdin g ly , w e d iscern no err orin the D is t r i ctC our t ’ s fi ndi ng on thi s R ul e 23( a) r equi r ementof cl as s cert i fi cat i on.77 T ur ni ng t o V an Ent erpr i s es ’ chal l enge t o the p red o m inan ce req u ir em en t of R u le 2 3 (b)(3 ), the D istri ct C o u rt p ro v id e d a n e a rlyv e rb a tim a n a ly s is o f th is e lem e n t in its G al l agher Set t l ement opi ni on as i t di d i n i t s Z ur i ch S ett lem ent o p in io n . T h e D istric t C o u rt n o ted th a t in o rd e r to sa tisf yth is e lem e n t o f R u le 2 3 (b )(3 ) “ p a rties m u st d o m o re th a n m e re ly demonstr at e a ‘ comm on i nt er es t i n a fai rcompromi s e’ ; i ns t ead, th e ym u s t p r o v id e e v id e n c e th a t th e p ro p o se d c las s is

‘ s uffi ci en t l y c o h e s i v e t o war r a n t a dj u d i c a t i o n by r epr es ent at i on. ’ ” I

d. at *12 ( quot i ng A m chem , 5 2 1 U

. S

. at 62 3 ). T h e D istric t C o u rt re f

e rre d b a c k to its R u le 2 3 (a ) c o m m o n a lity anal y s is in w hi ch i ti dent i fi ed the fol l ow i ng i s s ues as bei ng com m on t o the cl ass: “w hether : ( 1) the G al l agherD efe ndant s ent er ed in to a c o n tra c t, c o m b in a tio n o r co n sp ira c yto all o cat e the mar ketfors al e of i ns ur ance ; ( 2) t he G al l agherD efe ndant s ’ contr act , combi nat i on or cons pi r acyhad the purpos e and ef fec tof r educi ng and unr eas onabl yrest r ai ni ng compet i t i on i n the sal e of i nsurance; (3) t he G al l agh e r D efen dan t s’ conductvi ol at ed § 1 of the Sherm an A ct ; ( 4) the G al l agherD efe ndant s engage d i n a pat t ern of r acke t eer i ng act i vi t y ; and ( 5) t he G al l agher D e f e n d a n ts v io la te d R IC O .”
I d. at*10.
H ow ever , one not abl e di ffe r ence betw een the D i s t r i ct C o u rt’s a n a ly sis o f p re d o m in a n c e in th e G a llag h e r S e ttl e m e n t in contr as tt o i t s di s cus s i on of thi s r equi r ementi n the Zuri ch78 S e ttl e m e n t is th a t th e D is tr ict C o u rt w a s a b le to sp e c if ica lly addr es s V an Ent erpr i s es ’ chal l enge t o the pr edomi nance req u ir em e n t b ec au se V an E n terprises h ad p rov ided a m o re t hor ough expl anat i on of i t s obj ect i on i n i t s w r i t t en subm i s s i on t o t he D i s t r i ctC our t

. T hus the D i s t r ictC our tnot ed thatV an E nterpri ses obj ect ed t o t he foll ow i ng : “[W ]hether anyanti t rust i n j u r yi s c o mm o n t o th e c l a s s ; whe t h e r P l a i n t i f f s c a n s h o w a u n i f o r m f r a u d u l e n tr e p r e s e n t a t i o n s u f f i c i e n tt o c e r t i fya RI CO cl as s ; and w hethercomm on u n jus tenr i chmenti s s ues pr edomi nat e thr oughoutt he cl as s . ” I d. at*14. N otw i t hs t andi ng th e rea so n s fo r V an E n terprises’ o b jecti o n , the D istri ct co u rt d eterm ined : “[N ]am ed P lai n ti ff s an d ab sen t class m em b ers a re a ss e rtin g id e n tica l cla im s th a t ar ise f ro m th e sa m e se t o f

f a c ts r egar di ng col l us i ve and a nt i compet i t i ve beha vi orof the G all ag h er D ef

en d an ts. C o n sist en t w ith the law o f the T h ir d C i r cui t , t hi s s at i s fi es the com m onal i t yr equi r ementof [Rul e] 23( a)

. ” I d.
W hi l e w e acknow l edge thatthe D i s t r i ctC our tw as i m preci se w hen i t referred t o R ule 23 (a) at t his po i nt of its a n a ly sis , as o p p o se d to R u le 2 3 (b )(3 ), it is cle a r f ro m th e e n tirety of the D i s t r i ct C our t ’ s di s cus s i on t hat i tw as as s es s i ng w hether t he pr edomi nance componentof R ul e 23( b) (3) w as s at i s fi ed. S im il arly , at an o ther p o int i n it s d iscu ssion , the D is tr ic t C o u rt r efe r r ed t o “the com m onal i t y r equi r ement of [R ul e] 23( b) ( 3) ” as o p p o s e d to th e p re d o m in a n c e re q u ir e m e n t o f R u le 2 3 (b )( 3 ). I

d. A ltho ug h iti s approp ri at e t o co nsi der the co m m on al i ty r equi r ementof R ul e 23(a) t ogetherw i t h t he pr edomi nance re q u ir e m e n t o f

R u le 2 3 (b )( 3 ), s ee I

n re W ar f ar i n Sodi um A nt i tr us tLi t ig. , 3 9 1 F

. 3 d at 52 8 , d istri c t c o u rt s m u st t ak e c are79 n o t to c o n f

late th e ter m in o lo g yb e c a u se d o in g so re su lts in con fusi on and m ayun derm i ne the di stri ctcou rt ’s con cl usi on s.
T her efor e, t o ens ur e thatt he pr edomi nance r equi r ement of R ul e 23( b) ( 3) w as s at i s fi ed, w e w i l l br i efl yanal y ze w hether comm on ques t i ons of l aw and fact pr edomi nat e overi ndi vi dual o n e s wi t h r e s p e c t t o t h e p l a i n t i f f s ’ f e d e r a l a n t i t ru s t a n d RI CO c laim s. A s w e d isc u ss e d in th e c o n tex t o f th e Z u ric h S e ttl e m e n t, beca us e t he fi r s t and t hi r d el ement s of a Sherm an A ctvi ol at i on f o c u s o n the cond uct of the defen dan t s, i t i s no t diffi cultto i den t i fycom m on qu est i on s r el ev a n t t o est abli shi ng t hese e lem ents , su c h a s w h e th e r th e G a llag h e r D e f e n d a n ts a g re e d w ith anyof the Insur er D efen dan t s t o st eer cust om ers to t ho se i ns ur er s i n exchang e for the paym entof cont i ngent c o m m iss io n s, w h e th e r th e G a llag h e r D e f e n d a n ts c o n sp ire d w ith anyI ns ur erD efe ndant s t o r educe co m p et i t i on i n t he i ns ur ance m arketbys ol i cit i ng non- compet i t i ve bi ds , w hethert he G a llag h e r D e f

e n d a n ts a g re e d w ith o th e r B ro k e r D e f e n d a n ts to s har e thei rcont i ngentcomm i s s i on a rr a n g ement s w i t h eac h ot her bu tn o t t o d i scl ose t hese arr ang em ents t o thei r cust om ers , w hethert he G al l agher D efe ndant s actual l y engage d i n col l us i ve a c tio n s w ith o th e r B ro k e r D e f e n d a n ts a s o p p o se d to m e re ly t aki ng uni l at er al act i ons i n thei row n bes t i nt er es t , w hetherany of the G al l agherD efe ndant s ’ agr eement s cons t i tut ed hor i zont al re stra in ts of tra d e , a n d w h e th e r th e G a llag h e r D e f e n d a n ts s ucce e d e d a ta l l o c a t i n g th e i rb u s i n e s s a mon g a s e l e c tg r o u p of insu rers in restraint of tr ad e. C o m m o n q u esti o n s tha t are r el evantt o t he s econd e l ement of a Sherm an A ctvi ol at i on i ncl ude w hethert he G al l agherD efe ndant s ’ act ion s r educe d com peti t i on for i nsurance, w hether the G al l agh er D efen dan t s’ ac ti ons r es ul t ed i n an al l ocat i on of cus t om er s and a80 cons ol i dat i on of th e i ns ur ance m arket , and w hethert he G al l agherD efe ndant s ’ act i ons caus ed an i ncr eas e i n the cos tof prem i um s for i nsurance. A s fo r t he fou rth el em ent, w e l i kew i se concl ude thatt her e ar e comm on ques t i ons r el evantt o pr ovi ng ant i t rus ti nj ur y . T he pl ai nt i ffs al l eged tha tpr emi um s thr oughout t he i ns ur ance i ndus t r y w er e art i fi ci al l y i nfl at ed as a r es ul t of the c o n tin g e n t co m m iss io n a g re e m e n ts a n d o th e r a lle g e d ly ant i compet i t i ve pr act i ce s tha t th e G all ag h er D ef en d an ts en g aged i n. B as ed on t hi s t heory , ant i t rus ti nj uryi s s us cept i bl e t o pr oof on a cl ass- w i de b asi s and invo l ves com m on qu est i on s. Tu r n i n g t o t h e p l a i n t i f

f s ’ RI CO c l a i m, ma n y o f th e s a me comm on ques t i ons t hat w e i dent i fi ed i n t he cont ext of the Zuri ch S e t t l e me n ta r e a l s o r e l e v a n t h e r e . Th e f i r s t e l e me n to f

a RI CO viol at i on i nvol ves t he comm on ques t i on of w hetherthe G a llag h e r D e f

e n d a n ts p a rticip a ted o r e n g a g e d in c o n d u c t w ith ot herI n su r erD efe ndant s and B r okerD efe ndant s . T he s econd el eme n t , whe t h e ra n e n t e rp r i s e e x i s t e d , a l s o i n v o l v e s c o mmon ques t i ons of l aw and fa ct , s uch as w h ethert he B r oker D efe ndant s and I ns ur erD efe ndant s w er e part of an a s s oci at i on in f a c t o r w h e th e r th e y f

o rm e d a n e n terp rise th ro u g h th e leg a lly recogn i zed C ou nsel of Insurance A gen t s an d B rokers

. Si m i l ar l y , t he thi r d and fourt h el ements i nvol ve comm on ques t i ons of l aw and factas w el l , i ncl udi ng w hetherthe ent erpr i s e w as bei ng us ed t o comm i t m ai l or w i r e fr aud, orot her act s t h a tc o n s t i tu t e r a c k e t e e r i n g , a n d whe t h e rs u c h a c t i v i t i es o c c u r r e d o f

t e n e n o u g h t o e s t a b l i s h a p a t t e r n . Ag a i n , we r ecogni ze tha tes t abl i s hi ng l i abi l i t yunderR I C O al s o r equi r es d e m o n stra tin g th a t th e p lain tiff s s u f f e re d a n in

ju ryto th e ir p ro p e rtyo r b u sin e ss , w h ich m a yre q u ire in d iv id u a l p ro o f in s om e ca s es , buti n t hi s cas e the pl ai nt i ffs ’ “pr emi um bui l dup”81 t h e o r yl e n d s i t s e l f

t o p r o o f o n a c l a s s - wi d e b a s i s . I n s u m, we con cl ud e t hat, becau se the essenti al el em ents of the plai nti ffs’ fede r al cl ai m s i nvol ve com m on ques t i ons of l aw and fa ct , s uch comm on ques t i ons pr edomi nat e overanyi ndi vi d u al ones , and R ul e 23( b) ( 3) i s s at i s fi ed.

c. C hal l enges t o t he P l an of A l l ocat i on V an Ent erpr i s es al s o cont ends thats epar at e s ubcl as s es s houl d h ave be en ce r t i fi ed t o ens ur e ade quat e r epr es ent at i on and a fai r al l ocat i on of the s et t l ement

. V an Ent erpr i s es ar gues that t he si x cat egor i es of cl ai m ant s among w hom t he s et t l ementfund i s al l ocat ed ar e s ubj ectt o di s par at e tr eatm entand that ant agoni s t i c i nt er es t s exi s tbetw een t hes e groups . A s an i ni t i al m at t er , w e not e thatV an Ent erpr i s es m ad e onl ya pas s i ng r efe r ence t o t he us e of s ubcl as s es i n i t s w r i t t en obj ect i on t o t he G al l agherSet t l ement , w h ich fal l s fars hor tof the “s uffi ci ent s peci fi ci t y ” s t andar d of present i ng an i s s ue forcons i der at i on b e f o re th e D istric t C o u rt in o rd e r to p re se rv e it f o r a p p e a l. Keenan , 9 8 3 F .2 d a t 4 7 1 ; accord Shel lP etr ol eum , 182 F. 3d at 218. V an Ent erpr i s es al s o fai l ed t o s u b stan t i at e i t s ar gum ent t hat the P lan of A l l ocat i on w as unfai r , ot hert han t o s t at e that “ther e i s s i gni fi cantdi s par at e tr eatm ent ” of t h e six c l ai m ant group s. N on et heles s, t o the ext ent that V an E nterpri ses’ ar gum ent s cont es tt he ade quacyof r epr es ent at i on – a cha l l enge w hi ch i tdi d pr es erve i n i t s w r i t t en obj ect i on – w e w i l l cons i der a ll o f th e se a rg u m e n ts o n a p p e a l.
T he D i s t r i ct C our t found thatV an Ent erpr i s es ’ chal l enge t o t he Pl an of A l l ocat i on w as actual l ya cha l l enge t o the c e rt i fi cat i on of the cl ass because V an E nterpri ses’ argum e n ts82 r el at ed t o t he ade quacyo f re pr es ent at i on as oppos ed t o t he fai rnes s of the amount s of t he fund thatw er e al l ot t ed t o eac h g ro u p o f c la im a n ts

. See Gal l a g h e rSe t t l e me n tFi n a l App r o v al O pi ni on at*9. W e agr ee w i t h t he D i str ict C our tthatV an E nt erpr i s es di d not r ai s e any s ubs t ant i ve chal l enges t o t he Pl an of A l l ocat i on, n o r d o es i tart i cul at e anys uch cha l l enge on ap p ea l. A cc o rdin g ly , w e f ind n o erro r i n the D is tri ct C o u rt ’s concl us i on t hatt he Set t l ementA gr eemen t and the Pl an of A ll o ca ti o n sati sfied the re q u ir em en ts of R u le 23 (e).
A ddr es s i ng V an Ent erpr i s es ’ chal l enges i n the cont extof t he adequac yof r epr es ent at i on r equi r ementof R ul e 23( a) , t he D istric t C o u rt f

o u n d th a t th e re w e re n o t an ya n ta g o n istic i nt er es t s amo n g t he C l as s M ember s . Speci fi cal l y , t he D i s t r i ct C our tdet erm i ned:
“H ere, iti s cl ear that the n am ed P l ai nti ffs’ i nt er es t s ar e not ant agoni s t i c t o thos e of the abs ent cl ass m em bers. T he cent ral qu est i on s i n thi s case r egar di ng t he G al l agherD efe ndants’ al l eged c o n d u c t, a n d th e im p a c t o f th a t co n d u c t o n b o th t he n a med Pl a i nt i ff

s a nd the a bs e ntc l ass m ember s , ani m at es i n an i dent i cal fas hion the cl ai m s of bo t h g roups. [I] n ad d re ssi ng these comm on ques t i ons , the named P l ai nt i ffs have adv ocated as vi go rou sl yfor the ab sentcl ass m e m b e rs a s th e yh a v e f o r t h e m s e lv e s .”
I d. at*11. T he D i s t r i ctC our tfound thatt he named pl ai nt i ffs di d nothave a nydi ver gentorconfl ic t i ng i nt er es t s w i t h t he a b se n t c la s s m e m b e r s a n d w e r e th e r e f o re a d e q u a te83 re p re se n tativ e s o f

th e c las s, a n d w e d isc e rn n o e rro r in th is fi ndi ng. M or eover , i n the abs ence of di ver genti nt er es t s among t he cl as s m ember s , w e conc l ude t hatthe D i s t r i ctC our tdi d not abu se i t s di scr et i on bycho osi ng no tt o u t i l i ze subc l asses .

D . C h all en ge to the A tt orn ey s’ Fee s i n t he Z ur i c h Se t t l e m e nt
1. St andards f

or A pprovi ng A t t orneys’ F ees R eques t s foraw ar ds of attorn ey s ’ fee s i n a cl as s act i on set t l ementm aybe pr es ent ed as ei t hera per cent age of the t ot al r ecove r yof a c om m on fu n d oras a dol l aramount t hati s not der i vat i ve of the s et t l ementval ue. W hen a pe r cent age of the t ot al r ecove r yof the s ett l ementi s r eques t ed, w e have a r t i cul at ed s ever al fac t or s t hata di s t r i ct cour t s houl d cons i derforas s es s i ng th e re a s o n a b le n e s s o f

th e f e e . See G unt erv. R i dgew ood E ner gy C or p. , 223 F. 3d 190 ( 3d C i r . 2000)

. T he G unt erfac t or s ar e as foll ow s: “( 1) t he s i ze of

the fund cr eat ed and the number of per s ons benef

i t t ed; ( 2) t he pr es ence orabs ence of sub st anti al obj ect i on s by m em bers o f t he clas s t o t he s et t l ementt erm s and/ or fe es r eques t ed by couns el ; ( 3) the skil l and ef fi ci encyof the at t or ney s i nvol ved; ( 4) t he compl ex ityand dur at i on of the l i t igation; ( 5) the r i s k of n o n p a ym ent; (6) the am ou nt of t i m e dev oted to t he ca s e bypl ai nt i ffs ’ couns el ; and ( 7) the aw ar ds in s im ila r c a s e s .”84 I d. a t 1 9 5 n .1

. T h e se f

a c to rs “ n e e d n o t b e a p p lied in a f o rm u laic w a y. . . a n d in c e rt a in c a s e s , o n e f a c to r m a yo u tw e ig h th e re s t.” I d. W e h a v e in stru c ted d istric t co u rts th a t th e ya re “ to e n g a g e in r obus tasse ssm en ts of

the f ee aw ard rea so n ab lene ss fac t or s w hen eval uat i ng a fee r eques t

. ” I n r e R i t e A i d C or

p. Sec. Li t ig. , 396 F

. 3 d 2 9 4 , 3 0 2 (3d C ir

. 2 0 0 5 ).
T he al t ernat i ve t o r eques t i ng a per cent age o f th e t ot al r e c o v e r yi s t o r e q u e s ta p a r t i c u l a rd o l l a ra mou n ti n c o n n e c t i on w ith class c o u n sel’s l o d estar. “The l odes t araw ar d i s cal cul at ed bym ul t i pl y i ng t he numberof h o u rs r eas onabl yw or ked on a c lien t’s c a s e b ya re a so n a b le h o u rlyb ill in g ra te fors uch s ervi ces bas ed on t he gi ven geogr aphi cal ar ea, t he natur e of t he servi ces pr ovi ded, and the e x p eri ence o f t he att orney s. T he m ult i pli er i s a devi ce that at t empt s t o acc ount for t he cont i ngent natur e orr i s k i nvol ved i n a part i cul arcas e and the q u a lity o f

th e a tto rn e y s ’ w o rk .”
I d. at305- 06 ( footnot e omi tt ed). T he r eas onabl enes s of the r eques t ed fe e ca n b e as s es s ed bycal cul at i ng t he l odes t ar m ul t i pl i er , w hi ch i s equal t o the pr opos ed fe e aw ar d di vi ded by t he l odes t ar( i

. e. , t he pr oductof the t ot al hour s and t he bl ended b ill in g ra te) . B u t th e lo d e sta r “ m u lti p lier n e e d n o t f a ll w ith in an yp re-d ef

ined ran g e, pro v ided that the D istri ct C o u rt ’s anal y s i s j us t i fi es t he aw ar d. ” I d. at307.

“ Th e p e r c e n t a g e - o f

- r e c o v e rym ethod i s gener al l yfavor ed i n comm on fund ca s es beca us e i t a l l ow s court s t o aw ar d fee s85 fr om t he fund ‘ i n a manner t hat r ew ar ds couns el fors ucce s s and penal i zes i tforfai l ur e. ’ ” I d. at300 ( quot i ng I

n r e Prudent i al I ns
. C o. , 1 4 8 F

. 3 d at 3 3 3 ). “ T h e lod estar m etho d is m o re t ypi cal l yappl i ed i n s t atutoryfee

- s hi ft i ng cas es , ” but

“ [ r]e g a rd les s o f

th e m e th o d c h o se n , w e h a v e su g g e ste d it i s se n sib le f

o r a c o u rt to u se a se c o n d m e th o d o f f e e a p p ro v a l to cr os s - chec k i t s i ni t ial fe e ca l cul at i on. ” I d. W hen the l odes t ar m e th o d is us e d o n ly a s a cr o ss -c h e c k , it is ap p ro p ria te to a p p ly an abr i dged anal y s i s , but cour t s s houl d s t i l l “expl ai n h o w the appl i cat i on of a m ul t i pl i er i s j us t i fi ed by t he fac t s of a part i cul ar c a s e. ” I n r e Prudent i alI

ns
. C o. , 148 F. 3d at340- 41. “The l odes t ar c r os s - chec k s erves the purpos e of a l ert i ng t he tr i al ju d g e th a t w h e n th e m u lti p lier is to o g re a t, th e c o u rt sh o u ld rec o n side r i ts calcu lat ion u n d er the p erc en tage -of -reco v ery m ethod, w i t h an ey e t ow ar d r educi ng t he aw ar d. ” In re R ite A id C or p. Sec. Li t ig. , 396 F. 3d at306.

2 . T h e D istr ict C o u r t’s A n a ly sis
T he D ist ri ctC our tbegan i t s anal y s i s bycal cul at i ng t he p e rcen t age o f recoveryt hat C l ass C ou nsel ’s fee request r epr es ent ed, anal ogi zi ng t he fee re ques tt o a comm on fund ca s e. T h e D istri c t C o u rt e x p lain e d th a t ac c o rd in g to C las s C o u n se l, the $ 2 9 , 9 5 0 , 0 0 0 fe e a w ard w as 2 3 % o f th e m inim u m rec o v ery at t r ibu ta bl e t o t hei reff or t s or , al t ernat i vel y , i f expe ns es and i ncent i ve aw ar ds w er e subtr act ed fr om the t ot al aw ar d, then the a t t o r n e ys ’ f

e e w o u l d a m o u n tt o 1 9 .9 % o f th e m i n i m u m r e c o v e r y. See Z uri ch S et t l em ent A t t orney s’ F ees O pini on at*2

. C l a ss C ouns el cl ai m ed – and the D i s t r i ctC our tacce p ted fort he purpo ses o f t hi s cal cul at i on – thatt heydes erved cr edi tfort he $100, 000, 000 s et t l em entfund es t abl i s hed underthe M O U and86 t he $29, 950, 000 forfee s and expe ns es , fora combi ned t ot al of $ 1 2 9 ,9 5 0 ,0 0 0

. I

d. T h e D istric t C o u rt a c k n o w led g e d th a t “th is Set t l ement i s not s t r i ct l y a com m on fund, ” but r eas oned thatthe appr opr i at e ana l y s i s “i s anal ogous t o thatper form ed t o t he comm on fund doctr i ne. ” I d. at*3.
T he D i str i ctC our tpr ocee ded t o anal y ze e ach of t he G unt erf a c to rs, a t ti m e s a p p ly in g so m e o f th e sa m e re a so n in g it us ed i n appr ovi ng t he Zuri ch Sett l ementA gr eem ent undert he G i rsh fac t or s . T he D i s t r i ct C our t concl uded thatthe fi r s tfac t or – t he s i ze of

t he fund c r eat ed a nd the numberof per s ons ben efi t t ed – w ei gh ed in favo r of app roval becau se “C l ass C ouns el w er e abl e t o obt ai n a si zea bl e r es ul t , $121, 800, 000, on behal f of the C l as s . ” I d. at *4

. T he D i stri ct C o u rt a l so r efe ren ce d t he numberof peopl e w ho w oul d benef i tfr om the Set t l ementA gr eementand t he fa ctthatthe Set t l ement A gr eementw oul d notbe r educ ed byaw ar di ng at t orney s ’ fee s a n d e x p e n s e s . I

d. T he D i s t r i ct C our t det erm i ned thatt he s econd fac t or– t he pr es ence orabs ence of s ubs t ant i al o bjecti ons by m ember s of the cl as s t o t he s ett l ementt erm s and/ orfee s r eques t ed by couns el – w ei ghed i n favorof appr oval due t o the “sm al l nu m ber of o bject i on s . . . [and t he l ack o f] m eri t s of t ho se obj ect i ons . ” I

d. a t* 6

. The D i s t r i c tCo u r tr e l i e d o n th e s a me reas on i ng i t used i n it s G i rsh an aly sis t o co n clud e tha t th e third and fourt h fac t or s w er e s at i s fi ed – the s ki l l and ef fi ci encyof the at torn ey s i nvol ved and the compl exi t yand dur at i on of the litig a tio n . See i d.
T he D i s tr i ctC our tfound t hat t he fi fth fac t or – t he r i s k of no n -p aym ent – w ei gh ed in favo r of app roval becau se “C l ass C o u n se l in v e ste d a su b sta n tial a m o u n t o f tim e a n d e f

f o rt to87 reach t his po i nt and ob t ai n the favo rabl e S et t l em ent” and “C l ass C ou nsel a c cepted t he respon si bil i t yof p rosecut i ng this cl ass act i on on a con ti n gentfee bas i s and w i t houtanyguar ant ee of s ucce s s oraw ar d. ” I

d. at*7. A s fort he s i xth fac t or– t he amount of t i m e devot ed t o t he ca s e bypl ai nt i ffs ’ couns el – t he D i s t r i ctC o u r tdet erm i ned thati tal s o w ei ghed i n favorof appr oval due t o t he l ar ge amountof t im e ( 200, 000 hour s pr i or t o s et t l ement ) , m oney( aggr egat e l odes t ar of nea r l y$74, 000, 000 and expe ns es of nea r l y$4, 000, 000) , and ef for t p u t f

o r t h by m a n y f ir m s (a p p ro x im a te ly f

if ty la w f ir m s ). See i d. Fi nal l y , the D i stri c t C o u rtdeterm i ned that the aw ard r equ est ed b yC l ass C ouns el ( ei t her23% or19. 9% ) w as r eas onabl e bec aus e i tw as on parw i t h amount s p revi ous l yaw ar ded i n s i m i l ars ett l ement cas es i n the D i s t r i ctof N ew J er s eyand i tw as w i t hi n t he r ange of pr i v a t e l yn e g o t i a t e d cont i ngentfee s forcomm er ci al l i t i gat i on. See i d. at*7- 8. C ons equent l y , the D i s t r i ctC our tconcl uded that

“ th e re q u e ste d f

e e b yC las s C o u n s e l is f a ir a n d re a so n a b le acc or di ng t o t he G unt erfac t or s . ” I d. at*8.
In a d d iti o n to c o n sid e rin g th e p e rc e n tag e o f re c o v e ryin t he cont extof th e G unt erfact ors, the D i stri ctC ou rtal so per form ed a l odes t arcr os s - check and cal cul at ed the l odes t ar m ul t i pl i erbyus i n g C l as s C ouns el ’ s pr opos ed fe e aw ar d of $29, 950, 000, and di vi di ng t hatnum berbyt he val ue of the l odes t art hatC l as s C ouns el cl ai m ed for i t s w or k thr ough J ul y31, 2006 ( t he appr oxi m at e t i m e w hen the Zur i ch Set t l ement A g re e m e n t w a s re a c h e d ). See i d. at *9

. T h e D istrict C o u rt acc ept ed t he t ot al num ber of hour s s ubm i t t ed byC l as s C ouns el and expl ai ned thati t“mayr el yon s um m ar i es s ubm i t t ed bythe a tto rn e y s , a n d is n o t r e q u ir e d to s c ru tin iz e e v e ry b illin g re c o rd .” I d. T he D i s t r i ctC o u rt al s o not ed that“C l as s C ouns el di d not88 p ro v id e d e c la ra tio n s in s u p p o rt o f a n yp a rt ic u l a r h o u rl yra te ,” b u t b a se d o n th e D istric t C o u rt’s o w n c a lcu latio n (w h ich it arrived atbydi vi di ng the t ot al l odes t arbyt he t ot al hours w orked), “[i ]tapp ears that the h ou rl yrat e being u sed byC l ass C ouns el i s appr oxi m at el y$365. ” I d. at *1 0

. T h e D istri ct C o u rt co n side re d this rat e re aso n ab le ba sed o n C lass C o u n sel’s e x p e ri e n c e a n d th e la c k o f o b je c t i o n s t o th e ra te

. Id

. T he D i s t r i ctC our t ’ s cal cul at i on pr oduced a l odes t arm u lt ipl i erof 0. 4, w hi ch t he D i s t r i ct C our t s t at ed w as “w i t hin an acc ept ed r ange. ” I

d. at*9.
B efore con cl ud i ng i t s anal y si s, the D i stri ctC ou rtal so addr es s ed the fi ve obj ect i o n s r ai s ed t o C l as s C ouns el ’ s fee r eques t

. Fi r s t , t he D i s t r i ct C our t r ej ect ed t he cl ai m t hatt he val ue of C l as s C ouns el t o cl as s m em b ers w as l ow erdue t o t he part ici p at i on of s ever al at t orney s gener al , s t at i ng t hat“[b] as ed on det ai l s of t he Set t l ement A gr eement s , i t does notappea rt hat C l as s C ouns el has run afoul of [the Thi r d] C i r cui t ’ s pr ohi bi t i on o f c o lle c tin g f

e e s b a s e d o n th e w o rk o f g o v e rn m e n ta l a g e n c ie s .” I d. at*5. N ext , r el y i ng on Hensl ey v. E ckerha rt , 461 U

. S. 424 ( 1983) , the D i s t r i ct C our t r ej ect ed the cl ai m t hatC l as s C ouns el w as s eeki ng t o r ecove rfee s b ase d on non- Z ur i ch Set t l ement r el at ed issue s , expl ai ni ng that“ther e ar e s i tuat i ons w her e ‘ t he p lain tiff ’s c laim s f

o r re lief w ill in v o lv e a c o m m o n c o re o f f a c ts orw i l l be bas ed on r el at ed l ega l theor i es ’ and that‘ [m ] uch of cou nsel ’s t i m e w i l l be d evo t ed g e n e ra ll yt o the l i t i gati on as a w hol e, m aki ng i tdi ffi cul tt o di vi de the hour s expende d on a cl ai m - by

- cl ai m bas i s . ’ ” Zuri ch Set t l ementA t t orney s ’ Fees O pi ni on at*5 ( quot i ng Hens l ey , 461 U

. S. at 435)

. T he D i s t r i ct C o u rt a lso re

jec ted th e o b

jec tio n s th a t C la ss C o u n se l f a iled to per form t h e i rg a t e k e e p e rf u n c t i o n a n d th a tth e f

e e s r e q u e s t ed89 w er e t oo hi gh, fi ndi ng bot h obj ect i ons “notper s uas i ve. ” I d. at *6. T he D i s t r i ctC our tfi nal l yr ej ect ed the obj ec ti o n t hatt he $10, 000 cl as s r epr es ent at i on fee w as t oo hi gh, s t at i ng t hat“the O b jec to rs f

a il t o p u t f

o rth a n ya u th o r it yto su p p o rt th is ar gum ent

. ” I

d. R el y i ng on i t s G unt eranal y s i s , w hi ch i nvol ved cal culat i ng t he percent age of r ecov ery , and i t s l od est ar c ross chec k, t he D i s t r i ctC our tappr o v ed C l as s C ouns el ’ s r eques t ed at t or ney s ’ fee s , r ei m bur s ementof expe ndi tures, and i ncent i ve aw ards for nam ed p l ai nti ffs.

3. T he O bj ect ors ’ C hal l enges on A ppeal
T h e Ia ad /Z o rke ss o b

jectors a rgu e tha t the D istri ct C o u rt abu sed i t s di scr et i on w hen i t aw arded $ 29 , 95 0, 00 0 in at t orney s’ f e e s an d co sts t o C lass C o u n sel b ec au se th e D istri ct C o u rt “ov eres t i m at ed the set t l em ent fund s cr eat ed solel ybyC lass C ouns el, incl uded t i m e i n C l as s C ouns el ’ s l odes t arthatw as s pentpur s ui ng uns ucce s s ful l i t i gat i on, and fa i l ed t o excl ude f r o m th e l o d e s t a rc a l c ul a t i o n c l e a r l ye x c e s s i v e t i me s ubm i s s i ons . ” In par t i cul ar , t hes e obj ect or s ar gue that“Zuri ch cl as s couns el can t ake cr edi t for no m or e t han $70 mi l l i on of the over al l s et t l ement , ” bec aus e al t hough t he M O U s ec u red $ 1 0 0 , 0 0 0 , 0 0 0 fo r a se tt lem en t fu n d , “ c lass co u n sel w ere e v e n tu a llyf

o rc e d to c e d e $ 2 9 ,9 0 0 ,0 0 0 to th e T h re e -S tate S ett lem en t i n o rde r to m ak e the o v era ll d ea l w o rk.” M o reo v er, th e ya ss e rt th a t b e c a u se “ 5 7 % o f th e S e ttl e m e n t F u n d [ g o e s] to t h e E x c e s s C l a i m a n t s r e p r e s e n t e d b y t h e v a r i o u s a t t o r n e ys g e n e r a l

. . . o n l y 4 3 % o f t h e $ 7 0 mi l l i o n b a l a n c e o f t h e M OU m oni es , or $30 m i l l i on, w i l l be pai d t o t he cl i ent s of the Zuri ch cl as s couns el

. ” T hus t heyar gue thatt he att orney s ’ fee s aw ar ded90 t o C l as s C ouns el r epr es entfart oo hi gh a per cent age of the t ot al s et t l ementval ue thatC l as s C ouns el ’ s eff or t s s ecur ed.
W i t h r es pectt o t he ca l cul at i on of the l odes t ar , the I aad/Z or kes s obj ect or s ar gue that“ther e i s no j us t i fi cat i on for C las s C o u n se l’s in c lu sio n o f a ll o f th e tim e sp e n t to d a te in th is cons ol i dat ed ca s e i n s u p p o r tof thei rr eques t ed fe e i n the s e t t l e me n to f

o n l yo n e s ma l l p o rt i o n o f t h e o v e r a l l M DL l i t i gat i on. ” A ccor di ngl y , thes e obj ect or s conten d t hatthe D i stric t C o u rt sh o u ld n o t h a v e a llo w e d C las s C o u n se l to “ m e re ly s u mma r i z e [ ] t h e t i me a n d e x p e n s e s o f e a c h o f t h e 4 4 l a w f i r ms t hatcl ai m ed t o h av e p erf or m ed w or k t hatcontr i but ed t o t he Z ur i ch s et t l ement

. ” A ddi t i onal l y , t heyar gue that C l as s C ouns el ab u sed their ga teke ep er f u n cti o n w ith resp ec t t o all o ca ti n g w o rk i n s uch a w ayt hatpr om otes ef fici ency , and more overt hatt he “amountof t i m e cl ai m ed bycert ai n fir m s . . . r ai s es t he p o s s ib ility o f

f ra u d .”
I n r es pons e, t he pl ai nt i ffs ar gue thattheyexec ut ed the M O U w i t h t he Zuri ch D efe ndant s “s even mont hs befor e Zuri ch s et t l ed w i t h t he A t t orney s G ener al and otherr egul at or s , ” and th a t “it w a s a re q u ire m e n t u n d e r th e M O U

. . . th a t Z u ric h se ttl e w i t h t he A t t or ney s G ener al ” and ther efor e C l as s C ouns el pl ay ed a cr i t i cal r ol e i n t he s et t l ement

. T heyal s o cont end that “[t ] he ar gum entt hatC l as s C ouns el can onl y r ecove r for t i m e s penton Z u ri ch , m o reo v er, ig n o res the rea li tythat C lass C o u n sel’s e f f o rts c a n n o t b e c o m p a rtm e n taliz e d , as a n u m b e r o f th e ir act i on s agai nstal l t he D efen dan t s p rovi de a ben efi t t o the C l ass a n d c lea rly h a d a b e a rin g o n th e Z u ric h D e f e n d a n ts’ in ter e st in a n d wi l l i ng n e s s t o s e t t l e . ” W i t h r e s p e c tt o t h e o b j e c t o r s ’ t i me cal cul at i on chal l enge, the pl ai nt i ffs ar gue that“eve n i f one91 as s um ed ther e w as so m e d u pl i cat i on, ” the aw ar d w as not exce s s i v e bec aus e i tw as “a f r act i on of C l as s C ouns el ’ s t ot al l odes t ar . ” I n s um , t he pl ai nt i ffs ar gue t hat “s i nce the r eques t ed f e e a m o u n t is n o m o re th a n a f ra c tio n o f th e to tal lo d e sta r to d a te, an d th e re q u e ste d f e e a n d e x p e n se a w a rd is no t b e in g p a id ou tof the com m on set t l em ent fun d, there i s especi al l yl i t t l e ri sk her e thatfi r m s w i l l s om ehow benef i tfr om i neff

i ci entbi l l i ng pr act i ces , ort hatt he C l as s w i l l i n anyw ay b e h armed bythe re q u e s te d a w a rd .”
T he Z ur i ch D efe ndant s do nott ake a pos i t i on as t o t he r eas onabl enes s of the att orney s ’ fee s ; how ever , theydo poi ntout t hatundert he t erm s of t he Z ur i ch S ett l ement A gr eement , “i f the Fees and Expense s aw ar d i s r educe d, as the O bj ect o rs s eek, C l as s C o u ns el m us tr ei m bur s e the Zuri ch D efe ndant s t hat am ou nt, w i t h int eres t.” T he int erveno r att orney s general al so t ake n o p osi t i on rel at i ng t o the pay m ent of at t orney s’ fees.
W e be li ev e th at it w as ap p rop ri ate fo r th e D istri ct C o u rt to ev alua te th e re aso n ab lene ss o f th e f e e a w ard u n d er a per cent age of

r ecoverym ethod even though t he Zuri ch Set t l ementi s nota typi cal comm on fund. I n o rde r to t es tthe rea so n ab lene ss o f the fe e u n d er this m etho d , the D istri ct C o u rt neede d t o det erm i n e w hatamount of the t ot al s et t l ementval ue co u l d b e a t t r i b u t e d t o t h e wor k o f Cl a s s Cou n s e l

. Al t h o ugh at one poi ntt he D i s t r i ct C our t r efe r s t o C l as s C ouns el achi evi ng a siz e a b le re su lt o f

$ 1 2 1 ,8 0 0 ,0 0 0 f

o r th e se ttl e m e n t f

u n d , itis c lea r f ro m th e re m a in d e r of th e D istric t C o u rt’s an a ly sis th a t it w as cr edi t i ng C l as s C ouns el w i t h achi evi ng $129, 950, 000 of the Set t l ementFund bas ed o n the $100, 000, 000 s ecur ed underthe92 M O U and the $29, 950 , 000 s ecur ed underthe s epar at e fe e a g re e m e n t.
It w a s re a so n a b le to in c lu d e th e $ 2 9 ,9 5 0 ,0 0 0 a m o u n t in t he ca l cul at i on of the s et t l ementval ue cr eat ed byC l as s C ouns el i n or dert o det erm i ne the per cent age of t he t ot al r ecoveryt hat t he fe e cons t i tut es beca us e i n the typi cal comm on fund ca s e, cl as s couns el w oul d be aw ar ded a per cent age of t he fund and the b a la n c e w o u l d b e a v a ila b le f o r t h e c la s s m e m b e rs (e .g ., d ef en d ant s agr ee t o pay$100, 000, 000 t o a comm on fund, but cl as s couns el i s aw ar ded 25% of the s et t l ementval ue, l eavi ng onl y$75, 000, 000 fort he cl as s )

. H er e, i ti s pos s i bl e t o vi ew t he agr eementr eac hed betw een the Z ur i ch D efe ndant s and the pl ai nti ffs (abs entt he amountt hatw as contr i but ed t o the s et t l ementfund pur s uantt o t he M ul t i

- St at e A gr eement negot i at ed byt he att orney s gener al ) as t ot al i ng $129, 950, 000 w i t h a 23% fee aw ar d. T hi s i s w hyC lass C ouns el as s ert s that t he i rf e e r e q u e s ta mou n t s t o 2 3 % o f t h e s e t t l e me n tv a l u e f or w hi ch theyw er e r es pons i bl e ( or19. 9% , once e xp ens es and ince n ti v e a w ard s are su b tr ac ted f rom the to tal fe e a w ard ).
T he o bject ors m ake a c olor able ar gu m ent that C l ass C o u n sel s h o u ld n o t be a ll o w ed to tak e c red itfo r th e e n ti re $ 1 0 0 , 0 0 0 , 0 0 0 a s s e tf

o r t h i n th e M OU b e c a u s e , u n d e rth e t e r ms o f th e S ett lem en t A g re em en t, the Z u ri ch D ef en d an ts w ere al l ow ed t o r educe t he t ot al amoun t tha ttheycontr i but ed t o t he cl as s s et t l ementfund by$29, 900, 000 bas ed on t he s epar at e fund th a t th e yw e re c re a tin g p u rsu a n t to th e T h re e -S tate A g re e m e n t. I f C l as s C ouns el can onl ytake cr edi tfor$70, 000, 000 of the val ue of the Zuri ch s et t l ementfund, t hen the per cent age- ofr ecove r yw hi ch C l as s C ouns el r eques t ed i s m uch l ar ger . R ather93 t han as ki ng forappr oxi ma t e l y$ 3 0 , 0 0 0 , 0 0 0 outof $130, 000, 000, C l as s C o uns el ’ s r eques tw oul d amount t o about$30, 000, 000 out of $10 0 , 0 0 0 , 0 0 0 , o r3 0 % o f th e f u n d

. Non e t h e l e s s , we d o n ot bel i eve thatt he D i s t r i ctC our tabus ed i t s di s cr et i on bycr edi t i ng C l as s C ouns el w i t h achi evi ng t he ent i r e $100, 0 0 0 , 000 as p ro v id e d f

o r in th e M O U , b e c a u se e v e n th o u g h n e a rly $30, 000, 000 of thi s amount w as s epar at el yearm arked for d istrib u tio n th ro u g h th e T h re e -S tate A g re e m e n t, th e m o n e ystill benef i t t ed pot ent i al Set t l ementC l as s M ember s i n t hatevery one w ho cho se t o cl ai m un der the T hree- S t at e A greem ent otherw i se w oul d have be en el i gi bl e t o cl ai m under t he Zuri ch Set t l ement A greem e n t. W e agree w i t h the D i stri ctC ou rtt hat C l ass C ouns el ’s e ffort s pr oduced a tl eas t$100, 000, 000 forthe S e ttl e m e n t C las s in a d d iti o n to th e $ 2 9 ,9 5 0 ,0 0 0 s e p a r a tely desi gn at ed fo r theirfees.
N ext w e con si de r the D i stri ctC ou rt ’s l od est ar anal y si s. A l t hough t he D i s t ri ct C o ur tw as onl yut i l i zi ng t he l odes t ar m et ho d as a cross- check of the reas on ableness of the fe e request u n d e r th e p e rc e n tag e -o f -re c o v e rym e th o d , it stil l n e e d e d to cal culat e t he lodest ar m ult i pli er correct l yi n o rderfor the crosscheck t o b e m eaningfu l

. Ini tiall y , despit e t he o bject ors’ arg u m en ts t o the co n tr ary , it w as n o t error fo r th e D istri ct C o u rt t o r e l y o n t i me s u mma r i e s i n s t e a d o f r e v i e wi n g a c tu a l t i me re c o rd s . See I

n r e Ri t e Ai d C or

p. Sec. Li t ig. , 396 F. 3d at306- 07; I n r e Prudent i al

I ns
. C o. , 14 8 F

. 3d at 3 42

. A l t ho ug h C l ass C o u n se l d id n o t d isc lo se th e b ill in g ra te th e yu se d to c a lcu late th e ir lo d e sta r, th e D istric t C o u rt h a d e n o u g h in f o rm a tio n to concl ude thatt he bl ended bi l l i ng r at e w as appr oxi m at el y$365, a n d th e D istric t C o u r t c o n sid e re d th is a “ re a so n a b le h o u rly bi l l i ng r at e fors u ch servi ces bas ed on the gi ven geogr aphi cal94 ar ea, t he natur e of the s ervi ces pr ovi ded, and the expe r i ence of t he att or ney s . ” Z ur i ch Set t l ementA t t orney s ’ Fees O pi ni on at*8 (in ter n a l q u o tatio n m a r k s o m itt e d ). W e h a v e n o re a so n to b eli ev e this fin d ing w as in erro r an d , b ec au se th e D istri ct C o u rt w a s in th e b e st po sitio n to m a k e th is as se ss m e n t, w e d e f e r to its re a so n a b le ju d g m e n t.
T he l odes t ar m ul t i pl i er t hatthe D i s t r i ctC our tcal cul at ed w as l es s t han one a nd t hus r evea l s t hatC l as s C o u n s el ’ s fee re q u e st c o n stitu tes o n lya f ra c tio n o f

th e w o rk th a t th e yb ill e d in conj unct i on w i t h t he Zuri ch Sett l ementA gr ee m ent

. E ven as s um i ng t her e w as s om e i nfl at i on of t he hour s bi l l ed i n r el at i on to th e Z u ric h S e ttl e m e n t o r so m e d u p lica tiv e w o rk in v o lv e d in t he t ot al hour s count , a s i gni fi cant adj us t m entw oul d have t o be m ade t o t he hour s cal cul at i on befor e the l odes t arm ul t i pl i er (h e re , a f

ra c tio n ) w o u ld e v e n b e g in to a p p ro a c h o n e . W h ile di s t r i ct cour t s m us tbe aw ar e of the pot ent i al form ani pul at i on of t he l odes t arand l odes t arm ul t i pl i er , w e ar e s at i s fi ed t hati n t he pr es entcas e the D i s t r i ctC our t ’ s l odes t arcr os s - chec k confi r m ed t he r eas onabl enes s of the fe e r eques t

. A ddi t i onal l y , the D i s t r i ct Cou r t ’ s a n a l y s i s o f

t h e G u n t erfac t or s w as w el l

- r eas oned and t hor ough and ther efor e furt hers uppor t s t he conc l us i on thatt he D i s t r i ctC our t ’ s aw ar d of fe es w as notan abus e of di s cr et i on.

I V . C oncl usi on F o r th e re aso n s set fo rth ab o v e, w e w il l af firm the o rde rs of the D i s t r i ctC our tgr ant i ng fi nal appr oval of the Zuri ch Set t l ementand the G al l agherSet t l ementand appr ovi ng t he m o tio n f o r a n a w a rd o f a tto rn e y s’ f e e s in th e Z u ric h S e ttl e m e n t.