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UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

ALEXIS RICHARDSON, et al.,

individually and on behalf of all others 

similarly situated,

Plaintiffs, Civil Action No. 13-508 (JDB)

v. 

L’ORÉAL USA, INC.,

 Defendant.

MEMORANDUM OPINION

In this case, plaintiffs allege that defendant L’Oréal USA, Inc., falsely and deceptively 

labeled several products as available exclusively in salons. The parties have moved for 

preliminary approval of a proposed settlement and preliminary certification of the settlement 

class. After careful consideration of the supporting memorandum and the accompanying 

exhibits, the Court will grant the motion for preliminary approval of the settlement and 

preliminary certification of the settlement class. 

BACKGROUND

Plaintiffs filed this action on April 15, 2013, alleging that defendant L’Oréal falsely and 

deceptively labeled its Matrix Biolage, Redken, Kérastase, and Pureology products as available 

only in salons when the products can be purchased in non-salon retail establishments including 

Target, Kmart, and Walgreens. See Compl. [Docket Entry 1] ¶¶ 1, 29 (Apr. 15, 2013). Plaintiffs 

allege that the salon-only label implies a superior quality product and builds a cachet that allows 

L’Oréal to demand a premium price. See id. ¶ 27. Plaintiffs acknowledge that L’Oréal has 

developed a campaign to fight the diversion—i.e., the sale of salon-only products through stores 
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that do not have a salon—for each of the product lines at issue in this litigation. See id. ¶¶ 30-37. 

But plaintiffs allege that, despite L’Oréal’s efforts, the products are available in non-salon 

establishments, and argue that L’Oréal’s labeling and advertising for these products is hence 

deceptive and misleading. See id. ¶ 46. 

Soon after filing this case, the parties filed a motion for preliminary approval of their 

proposed settlement. The terms of the proposed Settlement Agreement include the following:

 Settlement Class: A Settlement Class of “all consumers nationwide who 

purchased the L’Oréal Products for personal, family or household use on or after 

August 30, 2008.” The Class excludes a few specific categories of consumers, 

such as those who purchased the products for resale, stylists, salon owners, those 

employed by L’Oréal or by plaintiffs’ counsel, and Court staff connected to this 

action. See Proposed Settlement Agreement [Docket Entry 9-2] ¶ 1.13 (May 15, 

2013). 

 Relief: The settlement provides for injunctive relief only. L’Oréal will remove the 

contested claims from U.S. advertising and from labeling on products for U.S.

distribution, except for certain products also sold or distributed in European 

countries using the same packaging; L’Oréal will not use the claims for at least 

five years, and, after five years, it may resume using the claims in markets with a 

60% reduction from 2012 levels of non-salon sales; L’Oréal will cease 

manufacturing labels for U.S. products that carry the claims and will remove the 

claims from websites and promotion materials shortly after the agreement 

becomes effective, but it will not destroy products or product packaging in its 

inventory. Id. ¶ 2.4.
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 Treatment of Class Representatives: Class representatives will petition for an 

incentive award of no more than $1000 each. Id. ¶ 2.5.

 Attorneys’ Fees: L’Oréal will not oppose an application by plaintiffs’ counsel for 

attorneys’ fees, costs, and expenses up to $950,000. The Agreement provides that 

the award of fees is separate from settlement; if the Court approves only a lower 

fee award, the remainder of the settlement will remain binding. Id. ¶ 2.6.

 Notice: Because L’Oréal lacks records to identify the vast majority of consumers 

who purchased the relevant products and where such purchases were made, the 

parties will publish a short-form notice in the legal notices section of USA Today 

for one week in the Monday-Thursday edition. The notice will refer proposed

class members to a comprehensive website that will contain additional 

information, including a copy of the proposed agreement. Objections by class 

members will have to be filed no fewer than 30 days prior to the Fairness Hearing. 

Id. ¶¶ 3.2, 3.5.

 Release: Upon final approval of the settlement, class members will release 

L’Oréal from liability for the alleged conduct or any related conduct, except as to 

individual (as opposed to class-wide) claims for monetary relief. Id. ¶ 4.6. 

ANALYSIS

I. Preliminary Approval of Proposed Settlement

“Preliminary approval of a proposed settlement to a class action lies within the sound 

discretion of the court.” See In re Vitamins Antitrust Litig., No. 99-197, 1999 WL 1335318, at 

*5 (D.D.C. Nov. 23, 1999). The Court will generally grant preliminary approval of a class action 

settlement if it appears to fall “within the range of possible approval” and “does not disclose 
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grounds to doubt its fairness or other obvious deficiencies, such as unduly preferential treatment 

of class representatives or of segments of the class, or excessive compensation for attorneys.”

Trombley v. Nat’l City Bank, 759 F. Supp. 2d 20, 23 (D.D.C. 2011) (internal quotation marks 

omitted); see also Newberg on Class Actions, § 11:25 (4th ed. 2013). The Court will consider (1) 

whether the proposed settlement appears to be “the product of serious, informed, non-collusive 

negotiations,” (2) whether it falls within the range of possible judicial approval, and (3) whether 

it has any obvious deficiencies, such as granting unduly preferential treatment. See In re

Vitamins Antitrust Litig., No. 99-197, 1999 WL 1335318, at *5 (internal quotation marks 

omitted).

The Court will first consider the process that resulted in the proposed agreement. “When 

a settlement is negotiated prior to class certification . . . it is subject to a higher degree of scrutiny 

in assessing its fairness.” D’Amato v. Deutsche Bank, 236 F.3d 78, 85 (2d Cir. 2001); see also In 

re Vitamins Antitrust Litig., 305 F. Supp. 2d 100, 105 (D.D.C.2004) (observing that settlement 

must not “come too early to be suspicious”). These considerations pose no obstacle here. 

Although the action’s history in this Court has been short, the litigation history between these 

parties as to these claims is substantial, and has allowed time for meaningful arm’s-length 

negotiations. The plaintiffs originally filed some of these claims in the Northern District of 

California. See Ligon v. L’Oréal USA, Inc., No. 12-4585 (N.D. Cal. Aug. 30, 2012). They then 

engaged in negotiations. See Halunen Decl. [Docket Entry 9-3] ¶ 4 (May 15, 2013). In the course 

of those negotiations, L’Oréal provided plaintiffs with extensive documents and information 

relating to its anti-diversion and labeling practices. Id. Plaintiffs’ counsel examined prices 

charged and conducted legal and factual research to determine the most reasonable and attainable 

resolution. Id. ¶¶ 5-6. The parties attended an in-person mediation session before the Honorable 
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Ronald Sabraw and finalized the agreement’s details in telephonic mediation sessions over the 

ensuing weeks. Id. ¶ 7. They worked out attorneys’ fees and costs through a second in-person 

mediation session and additional settlement discussions. Id. ¶ 8. Pursuant to the tentative 

agreement, plaintiffs voluntarily dismissed the California action and filed their claims in this 

Court. See Settlement Agreement ¶¶ D-E. Based on this process, the Court finds that informal 

discovery gave counsel “sufficient information . . . to reasonably assess the risks of litigation visà-vis the probability of success and range of recovery,” Trombley, 759 F. Supp. 2d at 26 (internal 

quotation marks omitted), and that the proposed Settlement Agreement is “the product of serious, 

informed, non-collusive negotiations,” In re Vitamins Antitrust Litig., No. 99-197, 1999 WL 

1335318, at *5 (internal quotation marks omitted).

Turning, then, to the substance of the agreement, the Court asks whether it falls within 

the range of possible approval. Both parties recognize substantial risks of proceeding with the 

litigation, and substantial costs, in terms of both time and money, in doing so. Although the 

proposed settlement provides only for equitable relief, plaintiffs assert that this limit reflects the 

risk they face in attempting to certify a damages class. First, assessing the value of the salon-only 

claims to consumers would be difficult, and L’Oréal has never attempted to do so. Second, 

assessing damages on a class-wide basis would be even more difficult—the information provided 

during the negotiation process revealed substantial price variations among retailers and in 

different regions, and indicated that non-salon retailers often sell the products at a lower price 

than do salon retailers, making damages to those purchasing the product in non-salon 

establishments difficult to analyze. Due to the valuation difficulty, plaintiffs’ counsel represents 

that proving monetary damages for a class of consumers would be challenging. “Opinion of . . . 

experienced and informed counsel should be afforded substantial consideration by a court in 
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evaluating the reasonableness of a proposed settlement.” In re Lorazepam & Clorazepate 

Antitrust Litig., No. 99-0790, 2003 WL 22037741, *6 (D.D.C. June 16, 2003). The Court affords 

counsel’s assessment such deference here. And class members will retain their right to seek 

damages in individual actions, dispelling many concerns about foregone payments. In these 

circumstances, an equitable-relief-only settlement may be approved. The equitable relief that is 

contemplated, moreover, directly addresses plaintiffs’ allegations by resolving the allegedly false 

and deceptive behavior. The Court hence finds that the proposed settlement lies within the range 

of possible approval. 

Finally, the agreement has no obvious deficiencies. The nominal incentive payments of 

up to $1000 for the lead plaintiffs appear reasonable. See Radosti v. Envision EMI, LLC, 760 F. 

Supp. 2d 73, 79 (D.D.C. 2011) (“[I]ncentive awards are not uncommon in common-fund-type 

class actions and are used to compensate plaintiffs for the services they provided and the risks 

they incurred during the course of the class action litigation.”). The proposed maximum award of 

$950,000, for attorneys’ fees, costs, and expenses, while high, is not outside the range of possible 

approval given the parties’ agreement as to the amount. Nor is approval of the full fee figure a 

condition of the settlement—pursuant to the agreement’s terms, if the Court finds a reduced fee 

award appropriate, the remainder of the settlement will continue to bind the parties and class 

members. See Settlement Agreement ¶ 2.6(c). The Settlement Agreement hence passes muster 

under preliminary review. 

CONCLUSION

For the reasons stated above, the Court will preliminarily approve the proposed 

settlement and class certification. The Court will also set a Fairness Hearing for October 11, 

2013, at 9:00 a.m. A separate Order will be issued on this date. 
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/s/

JOHN D. BATES

United States District Judge

Dated: June 27, 2013