1

The court has allocated two days, February 16 and 17, 2010,

for the hearing.

 IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

WICHITA FALLS DIVISION

VICTORIA KLEIN, et al., §

 §

Plaintiffs, §

 § Civil Action No. 7:03-CV-102-D

VS. § (Consolidated with 

 § Civil Action No. 7:09-CV-094-D)

O’NEAL, INC., d/b/a O’NEAL, §

JONES & FELDMAN §

PHARMACEUTICALS, et al., §

 §

Defendants. §

MEMORANDUM OPINION

 AND ORDER 

In this class action alleging personal injury and death claims

arising from the manufacture and distribution of E-Ferol Aqueous

Solution (“E-Ferol”), the court addresses three motions that have

been filed in advance of the fairness hearing (“fairness hearing”)1

to consider the proposed settlement of the case: (1) class member

Sharon Jenkins’ (“Jenkins’”) December 30, 2009 motion to extend

time to submit additional documents with regard to objections to

the settlement and to the fairness hearing, (2) class member

Lawrence V. Long, Jr.’s (“Long’s”) January 6, 2010 motion for leave

to serve interrogatories and document requests, and (3) defendants

O’Neal, Inc., d/b/a/ O’Neal, Jones & Feldman Pharmaceuticals, CVS

Revco D.S., Inc., and Retrac, Inc.’s January 8, 2010 motion for

 

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2

Under § 205(a)(5) of the E-Government Act of 2002 and the

definition of “written opinion” adopted by the Judicial Conference

of the United States, this is a “written opinion[] issued by the

court” because it “sets forth a reasoned explanation for [the]

court’s decision.” It has been written, however, primarily for the

parties, to decide issues presented in this case, and not for

publication in an official reporter, and should be understood

accordingly.

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leave to take depositions.2

I

Jenkins seeks leave to obtain and file medical records and to

depose three physicians from Children’s Hospital in Cincinnati,

Ohio. She maintains that this discovery will support her

objections to the proposed settlement. Although Jenkins

characterizes her position as an “objection” to the settlement, she

admits that 

if her category placement is changed [from

Category 4 to the more lucrative Category 1]

she will agree with the terms of the proposed

settlement . . . . Sharon Jenkins is not

pleased with the terms of the proposed

settlement but she is willing to abide by the

proposed settlement in the event that she is

placed in Category 1 of the proposed

settlement.

 

Jenkins Mem. 1-2. Elsewhere, Jenkins expands her request to

include the assertion that she should be placed in a new category

that exceeds Category 1, arguing that her claim is stronger than

even those described in category 1. See Jenkins Objections 2.

Except as permitted below, the court denies her motion. “The

scope of the discovery to be conducted in each case rests with the

 

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The court notes that, in addition to requesting that her

claim be re-categorized, Jenkins asks that the definition of

Category 1 be changed. She can present her relevant arguments at

the fairness hearing without the discovery she requests or an

extension of deadlines.

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sound discretion of the trial judge.” Cotton v. Hinton, 559 F.2d

1326, 1333 (5th Cir. 1977). Because the admitted purpose of

Jenkins’ motion is to develop evidence in support of her attempt to

move into Category 1, and she has not pointed to any facts

indicating that the proposed settlement as a whole is not fair,

reasonable, and adequate to class members, or the product of

collusion, the court declines to allow Jenkins to conduct discovery

and to extend relevant deadlines before the fairness hearing,

except as noted below. Under the terms of the settlement, assuming

it is approved, Jenkins can request that her case be reviewed by a

court-appointed independent medical expert and reassigned to

another category. As class plaintiffs note, any determination by

such an expert would be binding on all parties.3

Neither defendants nor class plaintiffs object to Jenkins’

filing medical records, provided that she does so in a timely

manner. Considering the absence of opposition, the court will

allow Jenkins to file medical records no later than February 5,

2010.

 

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II

Long requests leave to serve discovery on defendants and class

plaintiffs. The discovery pertains both to class plaintiffs’

application for attorney’s fees and the mediation negotiations that

resulted in the settlement agreement that will be the subject of

the fairness hearing. The court grants the motion in part and

denies it in part.

A

With the modifications explained below, the court grants

Long’s motion as it relates to the attorney’s fee calculations

submitted by class plaintiffs. “In a class action settlement, the

district court has an independent duty under Federal Rule of Civil

Procedure 23 to the class and the public to ensure that attorneys’

fees are reasonable and divided up fairly among plaintiffs’

counsel.” In re High Sulfur Content Gasoline Prods. Liab. Litig.,

517 F.3d 220, 227 (5th Cir. 2008). “The court’s duty to review

attorneys’ fees is no less compelling in common fund cases, like

this case, where a separate fund to pay attorneys’ fees is created

as part of the class action settlement.” Id. at 227-28.

Furthermore, “the district court’s findings and reasons [for

approving the attorney’s fee motion] must be ‘complete enough to

assume a review which can determine whether the court has used

proper factual criteria in exercising its discretion to fix just

compensation.’” Id. at 229 (quoting Brantley v. Surles, 804 F.2d

 

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321, 326 (5th Cir. 1986)).

Much of the discovery that Long seeks is related to the

attorney’s fee calculations and will be relevant to the court’s

duty to independently evaluate class plaintiffs’ fee motion. The

court therefore grants Long’s request, except as modified below.

Because a court may not simply approve an award of attorney’s fees,

even if it is unopposed, Long’s request appears to add little

additional burden on class counsel. As a class member, Long

maintains the right to object to the fee motion, see Fed. R. Civ.

P. 23(h)(2), and the requested information will enable him to

determine if there are grounds for such an objection. Because the

majority, if not all, of the information would be required for the

court to adequately assess the fee motion, class counsel is not

unduly burdened by Long’s request.

Accordingly, the court grants Long’s motion to serve discovery

on class plaintiffs related to the calculation of attorney’s fees.

This decision here covers Exhibit A to Long’s motion

(interrogatories addressed to plaintiffs), and Requests Nos. 1-5 of

Exhibit B (requests for production of documents to plaintiffs).

Because several of Long’s proposed interrogatories and discovery

requests seek more detailed responses than the court deems

necessary, the following information is excluded from Long’s

discovery: 

 

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Interrogatory No. 16: Class plaintiffs are not required to

supply any information other than the qualifications, education,

and work experience of the “Medical Review Team” members. 

Interrogatory No. 19: Class plaintiffs are not required to

disclose any compensation, salary, or bonus information regarding

Kathleen Dahle (“Dahle”). 

Interrogatory No. 20: Class plaintiffs are not required to

disclose any compensation information regarding any forms W-2 and

1099 issued to Dahle.

Document Request No. 1: No response is required.

Document Request No. 5: No response is required.

Document Requests Nos. 2-4: No information regarding salary or

other compensation, if any, need be disclosed (it may be redacted).

Accordingly, except as disallowed, Long’s motion to serve

discovery on class plaintiffs regarding the calculation of

attorney’s fees is granted. Class plaintiffs must serve their

responses to Long’s discovery requests no later than Friday,

February 5, 2010, at 5:00 p.m. CST. Long’s response to class

plaintiffs’ fee motion must be filed by Wednesday, February 10,

2010, at noon CST. Class plaintiffs’ reply brief, if any, must be

filed before the beginning of the fairness hearing on Tuesday,

February 16, 2010.

 

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B

The court denies Long’s motion to serve discovery relating to

the mediation negotiations that led to the proposed settlement.

Long seeks discovery of documents that “focus on the negotiating

positions taken by each side in their settlement negotiations in

the mediation,” to be used in “evaluating the strengths and

weaknesses of each side’s claims and defenses.” Long Mot.

Discovery 6. Long contends that he intends to challenge the

fairness and adequacy of the proposed settlement. To do so, he

seeks to compare the early bargaining positions of the parties with

the eventual settlement amount, as well as the value of each

settlement category. He maintains that he “has a specific interest

in such evidence because he believes the settlement amount

allocated to his claim is significantly lower when compared to the

value of his claim if it were brought as a stand alone claim in an

Ohio state court litigation.” Long Reply Br. 8. He posits that

class counsel may have “sacrificed” his individual claim for the

purposes of appeasing defendants and thereby increasing the

recovery for the class overall. Id. at 10. Long does not allege

that class counsel failed to exercise due diligence in pursuing all

possible claims or that there is any evidence of collusion.

As stated above, the scope of discovery rests in the court’s

sound discretion. See Cotton, 559 F.2d at 1333. For purposes of

the fairness hearing and any objections that Long seeks to advance

 

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concerning the settlement, the court holds that the information he

requests is not discoverable because it falls outside the scope of

Rule 26(b)(1). “The gravamen of an approvable proposed settlement

is that it be ‘fair, adequate, and reasonable and is not the

product of collusion between the parties.’” Newby v. Enron Corp.,

394 F.3d 296, 301 (5th Cir. 2004) (quoting Cotton, 559 F.2d at

1330). The six factors that the court must consider in deciding

whether to approve the settlement are: 

(1) evidence that the settlement was obtained

by fraud or collusion; (2) the complexity,

expense, and likely duration of the

litigation; (3) the stage of the litigation

and available discovery; (4) the probability

of plaintiffs’ prevailing on the merits; (5)

the range of possible recovery and certainty

of damages; and (6) the opinions of class

counsel, class representatives, and absent

class members. 

Id. (citing Reed v. Gen. Motors Corp., 703 F.2d 170, 172 (5th Cir.

1983)). The court is to evaluate the proposed settlement on its

face, and it need not analyze the negotiations that led up to it.

Generally speaking, a settlement should stand

or fall on the adequacy of its terms. The

overriding theme of our caselaw is that formal

discovery is not necessary as long as (1) the

interests of the class are not prejudiced by

the settlement negotiations and (2) there are

substantial factual bases on which to premise

settlement.

Id. at 306. Moreover, “where the objectors represent only a small

percentage of the class, the likelihood of the court granting their

discovery requests decreases because the court will give great

 

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weight to the interests of the majority of the class members.”

Hemphill v. San Diego Ass’n of Realtors, Inc., 225 F.R.D. 616, 620

(S.D. Cal. 2005) (citing cases). 

Long’s discovery requests that relate to the mediation and

settlement negotiations do not appear to be targeted at information

that will be relevant to the factors that the court will consider

at the fairness hearing. Long explicitly states that his concern

is that he will receive less money as a class member than he could

if allowed to pursue his own lawsuit. Long’s unsuccessful attempt

to opt out, however, does not entitle him to derail the settlement,

assuming it is fair, adequate, and reasonable to the class as a

whole and not the product of collusion. His suspicion that “class

counsels’ interest was mainly to get a deal done that would benefit

the entire class,” Long Reply Br. 12, does not merit his open-ended

and wide-ranging discovery request. The court has already denied

Long’s request to opt out, see Klein v. O’Neal, Inc., 2009 WL

1174638, at *5 (N.D. Tex. Apr. 29, 2009) (Fitzwater, C.J.), and it

declines to cover the same ground under the guise of Long’s

“objections” to the proposed settlement. Furthermore, Long does

little to dispel defendants’ assertion that his discovery seeks

information regarding an offer of compromise that would “prove

liability for, invalidity of, or amount of a claim that was

disputed as to validity or amount,” which is prohibited under Fed.

R. Evid. 408(a). 

 

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Accordingly, the court denies Long’s motion for leave to serve

discovery related to the mediation and settlement negotiations.

This denial applies to Requests Nos. 6-11 of Exhibit B to Long’s

motion (requests for production of documents to plaintiffs), and

Exhibit C (requests for production of documents to defendants).

III

Defendants seek leave to take the deposition of two physicians

from Children’s Hospital in Cincinnati, Ohio for the purpose of

responding to Long’s objections to the settlement. The physicians

were involved in the care of Long’s daughter before her death.

Defendants assert that their testimony will be relevant to the

issues of whether Long knew that his daughter was given E-Ferol and

his allegations of fraudulent concealment by those involved in her

treatment. Defendants represent that they have confirmed the

physicians’ availability for a date and location before the

fairness hearing.

The court grants defendants’ motion. Unlike the disallowed

discovery that Long seeks, these depositions are of fact witnesses

who will address issues relevant to Long’s objections to the

proposed settlement. Long has stated his intention to present his

objections at the fairness hearing, and the defendants should be

permitted to obtain this discovery for the purpose of responding to

them. 

The fact that a stay entered in Long’s Ohio state court

 

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lawsuit precluded Long from taking these depositions does not

warrant denying defendants this discovery in the present case. The

stay was issued so that the parties could focus on, and conduct

discovery in, this suit. Although the timing of the depositions——

just weeks before the fairness hearing——could impose some burdens

on the parties, the court does not find that they are sufficient to

warrant denying the motion. The depositions will be held in

Cincinnati and therefore should not require burdensome travel by

Long’s counsel. And class plaintiffs do not oppose the motion.

The court concludes that defendants’ motion should be granted. The

depositions are to be conducted at the date and time specified in

the motion, unless the parties agree otherwise.

* * *

Accordingly, for the foregoing reasons, the court grants in

part and denies in part Jenkins’ December 30, 2009 motion to extend

time to submit additional documents with regard to objections to

the settlement and to the fairness hearing; grants in part and

denies in part Long’s January 6, 2010 motion for leave to serve

interrogatories and document requests; and grants defendants’

January 8, 2010 motion for leave to take depositions.

SO ORDERED.

January 21, 2010.

_________________________________

SIDNEY A. FITZWATER

CHIEF JUDGE

 

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