United States Court of Appeals

For the Eighth Circuit

___________________________

No. 13-3581

___________________________

James Lawrence Marshall; Joseph Michael Senser; Dante Anthony Pastorini

lllllllllllllllllllll Plaintiffs - Appellants

Fred Barnett; Tracy Simien; Darrell Alexander Thompson; James Nathaniel

Brown; Mark Gregory Clayton; Irvin Acie Cross; Brian Duncan; Billy Joe Dupree;

Michael James Haynes; Paul James Krause; Reginald McKenzie; Reginald Joseph

Rucker;Jackie Larue Smith, on behalf of themselves and all others similarly situated

lllllllllllllllllllll Plaintiffs - Appellees

John Frederick Dryer; Elvin Lamont Bethea; Edward Alvin White; Lemuel Joseph

Barney; Bruce Allan Laird; Preston Pearson; Jim Ray Smith

lllllllllllllllllllll Plaintiffs

v.

National Football League

lllllllllllllllllllll Defendant - Appellee

___________________________

No. 13-3582

___________________________

Marcus Dell Gastineau; Abdul Salaam

lllllllllllllllllllll Plaintiffs - Appellants
Fred Barnett; Tracy Simien; Darrell Alexander Thompson; James Nathaniel

Brown; Mark Gregory Clayton; Irvin Acie Cross; Brian Duncan; Billy Joe Dupree;

Michael James Haynes; Paul James Krause; Reginald McKenzie; Reginald Joseph

Rucker;Jackie Larue Smith, on behalf of themselves and all others similarly situated

lllllllllllllllllllll Plaintiffs - Appellees

John Frederick Dryer; James Lawrence Marshall; Joseph Michael Senser; Elvin

Lamont Bethea; Dante Anthony Pastorini; Edward Alvin White; Lemuel Joseph

Barney; Bruce Allan Laird; Preston Pearson; Jim Ray Smith

lllllllllllllllllllll Plaintiffs

v.

National Football League

lllllllllllllllllllll Defendant - Appellee

___________________________

No. 13-3666

___________________________

Jed Weaver

lllllllllllllllllllll Plaintiff - Appellant

Fred Barnett; Tracy Simien; Darrell Alexander Thompson; James Nathaniel

Brown; Mark Gregory Clayton; Irvin Acie Cross; Brian Duncan; Billy Joe Dupree;

Michael James Haynes; Paul James Krause; Reginald McKenzie; Reginald Joseph

Rucker;Jackie Larue Smith, on behalf of themselves and all others similarly situated

lllllllllllllllllllll Plaintiffs - Appellees

-2-
John Frederick Dryer; James Lawrence Marshall; Joseph Michael Senser; Elvin

Lamont Bethea; Dante Anthony Pastorini; Edward Alvin White; Lemuel Joseph

Barney; Bruce Allan Laird; Preston Pearson; Jim Ray Smith

lllllllllllllllllllll Plaintiffs

v.

National Football League

lllllllllllllllllllll Defendant - Appellee

____________

Appeals from United States District Court 

for the District of Minnesota - Minneapolis

____________

 Submitted: December 10, 2014

 Filed: May 21, 2015

____________

Before BYE, SMITH, and KELLY, Circuit Judges.

____________

BYE, Circuit Judge

Six former National Football League ("NFL") players ("Appellants") appeal

the district court's approval ofthe class-action settlement between nearly 25,000 class

members and the NFL. The negotiated settlement agreement resolves the litigation

surrounding the NFL's use of former NFL players' likenesses and identities. The

complex settlement—a product of numerous settlement conferences and years of

litigation—provides two unique benefits to the class: (1) the establishment of a

licensing agency to assist former NFL playersin marketing their publicity rights with

the support of the NFL; and (2) up to a $42 million payout by the NFL for the benefit

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of the class. Appellants contend the district court abused its discretion in approving

1

the settlement because it does not provide for a direct financial payment to each class

member and is not fair, reasonable, and adequate. We affirm.

I

The class action complaint alleges that for many years NFL Films—the

commercial filmmaking wing of the NFL—has used the names, images, likenesses,

and identities of former NFL players in its various videos to generate revenue and

promote the NFL. The NFL Films videos are "promotional film productions with

scripts, music, editing, direction and production completely independent of the play

and production of the games themselves." They seek to provide fans with the story

of the game, such as the "perspective of the game that perhaps [fans] were not aware

of when they watched the broadcast on network television." According to

Appellants, the use of the players' likenesses and identities has helped the NFL gain

substantial profits and improve its brand.

In 2009, Appellants brought this class action against the NFL on behalf of a

class of former NFL players whose name, voice, image, or likeness was used by the

NFL to gain profit or promote the NFL. The class asserted claims for false

endorsement under the Lanham Act, 15 U.S.C. § 1125, common law and statutory

rights of publicity claims under severalstates' laws, and unjust enrichment. The NFL

moved for judgment on the pleadings, contending the claims failed because they were

either precluded by the First Amendment, preempted by the Copyright Act, or were

insufficient to constitute false endorsement. At the pleadings stage, the district court

denied the motion, and the parties proceeded to discovery. More than two years into

the litigation, the NFL moved for partial summary judgment on issues regarding

The Honorable Paul A. Magnuson, United StatesDistrict Judge for the District 1

of Minnesota.

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choice of law and the applicable statute of limitations. The district court held that all

claims prior to August 23, 2003, were time-barred, all claims arising between August

23, 2003, and August 1, 2004, were governed by Minnesota's statute of limitations,

and that it was premature to determine the choice of law and applicable statute of

limitations for all remaining claims.

On December 12, 2012, pursuant to Federal Rule of Civil Procedure 23(d) and

(g), the Magistrate Judge appointed a lead settlement counsel to act as a single

2

representative for the class in settlement discussions. See Dryer v. Nat'l Football

League, No. 09-2182 (PAM/AJB), Dkt. No. 250, at *1 (D. Minn. Dec. 12, 2012). The

Magistrate Judge explained that lead settlement counsel was necessary because the

settlement discussions and settlement process stalled due to "serious disagreements

among the three lead counsel for Plaintiffs." Id., Dkt. No. 252, at *1. The Magistrate

Judge hoped to "restart the settlement negotiations without the distractions presented

by Plaintiffs' co-lead counsel's disagreements and to protect the interests of the

putative class as a whole." Id. at *2.

On March 18, 2013, the plaintiffs filed a second amended complaint, adding

other named plaintiffs, and a motion for preliminary approval of the settlement

agreement. In summary form, the complex sixty-page settlement agreement provides

for the following:

(1) The creation of the Common Good Entity, a non-profit organization;

(2) Payment of up to $42 million by the NFL to the Common Good

Entity over eight years;

(3) The establishment of the Licensing Agency;

The Honorable Arthur J. Boylan, United States Magistrate Judge for the

2

District of Minnesota, now retired.

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(4) Payment of $100,000 worth of media value to the Licensing Agency

each year until 2021;

(5) Payment of attorneys' fees and settlement administration expenses; 

(6) A reserve for the NFL's potential fees and costs of litigation

involving class members who opt out of the settlement; and

(7) The class members' perpetual release of any claims and all their

publicity rights for the NFL and its related entities to use.

TheCommon Good Entity is "dedicated to supporting and promoting the health

and welfare of Retired Players and other similarly situated individuals." Under the

settlement, the NFL is obligated to pay up to $42 million over eight years to the

Common Good Entity, which will then disburse the money to charitable organizations

or health and welfare organizations for the benefit of class members. Disbursement

from the Common Good Entity may only be for (1) medical research; (2) short-term

and long-term housing; (3) health and dental insurance coverage; (4) medical

screening and evaluations; (5) mental health programs; (6) wellness programs; (7)

careertransition programs;(8) anymedical costs not covered by health insurance; and

(9) other uses as approved by the Board of Directors of the Common Good Entity. 

After ten years, any remaining funds initially contributed by the NFL revert back to

the NFL for its charitable use. The NFL may also deduct up to $13.5 million from the

$42 million obligation for any expensesrelated to litigation involving class members

who opt out of the settlement.

The Licensing Agency created by the settlement allows for one-stop shopping

for those seeking to purchase the publicity rights of former NFL players. Like the

Common Good Entity, the Licensing Agency is an organization with a Board of

Directors that includes class members. Class members may provide authorization (or

withdraw it at any time) for the Licensing Agency to license the player's publicity

rights to opportunities identified by the Licensing Agency. The Licensing Agency

has selected IMG, one of the largest and most successfulsports marketing firms in the

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world, to assist its operations and identify marketing and business opportunities. 

Under the settlement, the NFL is obligated to provide $100,000 worth of media value

each year until 2021 for the Licensing Agency's commercials. The NFL is also

obligated to work cooperatively with the Licensing Agency for referral business and

opportunities and, in good faith as it would with any other licensee, provide any

potential licensee of the Licensing Agency with licensing for the NFL shield

trademark or copyrighted game footage. Proceeds from the Licensing Agency will

be divided between the Common Good Entity and the class member whose rights are

sold, with the class member receiving seventy-five percent of the proceeds. The

Licensing Agency is expected to significantly reduce transaction costs and unlock the

value of the group publicity rights of the class members.

After a hearing, the district court preliminarily approved the settlement and

certified the class under Rule 23(b)(3). Over the objections of several named

plaintiffs, the district court reasoned the settlement wasfair, reasonable, and adequate

because it provided a "direct[] benefit[ to] those in whose name th[e] lawsuit was

purportedly brought." Dryer v. Nat'l FootballLeague, No. 09-2182 (PAM/AJB), Dkt.

No. 270, at *2 (D. Minn. Apr. 8, 2013). The court also rejected the notion that the

settlement constituted an improper cy pres distribution. Id. at *4. Upon notice to all

class members and the expiration of the exclusion and objection deadlines, and after

a hearing for the final approval of the settlement, the district court issued its order

approving the settlement. When the opt-out period closed, nearly 25,000 class

members remained and 2,073 sought to opt out. Dryer v. Nat'l Football League, No.

09-2182 (PAM/AJB), 2013 WL 5888231, at *1 (D. Minn. Nov. 1, 2013). Another

thirty-eight made an untimely request, and one more inadvertently withdrew his

exclusion request, all of whom were excluded from the class. Id. Nineteen members

filed objections, seven of whom also requested to be excluded. Id. After a

supplemental notice wasissued because of a violation of a preliminary injunction put

in place by the district court, 158 class members timely withdrew their requests for

exclusion and 6 filed untimely requests; all were included in the class. Id. at *2.

-7-
II

"We generally review for abuse of discretion a 'district court's decision to

approve [a] global settlement over' objections." In re Uponor, Inc. F1807 Plumbing

Fittings Prods. Liab. Litig., 716 F.3d 1057, 1063 (8th Cir. 2013) (alteration in

original) (quoting In re BankAmerica Corp. Sec. Litig., 350 F.3d 747, 752 (8th Cir.

2003)). "Only upon the clear showing that the district court abused its discretion will

this court intervene to set aside a judicially approved class action settlement." 

Reynolds v. Nat'l Football League, 584 F.2d 280, 283 (8th Cir. 1978). We have

explained that considerable deference is due to the district court's approval of a

settlement:

[The] determination is committed to the sound discretion of the trial

judge. Great weight is accorded his views because he is exposed to the

litigants, and their strategies, positions and proofs. He is aware of the

expense and possible legal bars to success. Simply stated, he is on the

firing line and can evaluate the action accordingly.

Van Horn v. Trickey, 840 F.2d 604, 606-07 (8th Cir. 1988) (quoting Grunin v. Int'l

House of Pancakes, 513 F.2d 114, 123 (8th Cir. 1975)). "A settlement agreement is

'presumptively valid.'" In re Uponor, 716 F.3d at 1063 (quoting Little Rock Sch. Dist.

v. Pulaski Cnty. Special Sch. Dist. No. 1, 921 F.2d 1371, 1391 (8th Cir. 1990)). 

"[M]indful of the limited scope of our review . . . [w]e ask whether the District Court

considered all relevant factors, whether it was significantly influenced by an

irrelevant factor, and whether in weighing the factors it committed a clear error of

judgment." Little Rock Sch. Dist., 921 F.2d at 1391.

The district court may only approve a class action settlement if it is "fair,

reasonable, and adequate." Fed. R. Civ. P. 23(e)(2). To make the determination, the

district court must consider four factors: "(1) the merits of the plaintiff's case

weighed against the terms of the settlement, (2) the defendant's financial condition,

-8-
(3) the complexity and expense of further litigation, and (4) the amount of opposition

to the settlement." In re Uponor, 716 F.3d at 1063 (quoting Van Horn, 840 F.2d at

607). "The single most important factor in determining whether a settlement is fair,

reasonable, and adequate is a balancing of the strength of the plaintiff's case against

the terms of the settlement." Van Horn, 840 F.2d at 607.

Before addressing these four factors, we must first address Appellants' initial

challenge that the settlement fails as a matter of law. Although the three sets of

appellants present the arguments in varying ways, they distill to two principled

arguments: the settlement fails because (1) it does not provide any direct benefit to

the class; and (2) it makes the financial payment to a third-party and not each class

member directly.

We begin with the guiding principle that "a class action settlement is a private

contract negotiated between the parties." In re Wireless Tel. Fed. CostRecovery Fees

Litig., 396 F.3d 922, 934 (8th Cir. 2005). The court's role in reviewing a negotiated

class settlement is to "to ensure that the agreement is not the product of fraud or

collusion and that, taken as a whole, it is fair, adequate, and reasonable to all

concerned." Id.

Appellants argue the settlement fails because it offers no benefit to the class. 

They attempt to characterize the settlement as simply giving away their proceeds to

a third-party charity. Plainly, this is not true and the argument is wholly without

merit. As more fully discussed below, the settlement agreement provides for two

substantial and direct benefits to the class as a whole: the Licensing Agency and a

payment of up to $42 million for the benefit of the class.

Appellants also argue the settlement fails because the financial payout for the

class is made through a third-party organization and not directly to each class

member. But we have never required that a settlement agreement specifically provide

-9-
for a direct financial payment to each class member, and the mere fact that some

members of a class may not receive a direct payment is not dispositive. See In re

Wireless, 396 F.3d at 934; see also Petrovic v. Amoco Oil Co., 200 F.3d 1140, 1146

(8th Cir. 1999) ("It seems to us that almost every settlement will involve different

awards for various class members."). As the Third Circuit has noted, "some courts

allow a settlement to require a payment only to a third party, that is, to provide no

recovery at all directly to class members." In re Baby Prods. Antitrust Litig., 708

F.3d 163, 172 (3d Cir. 2013) (quoting American Law Institute ("ALI"), Principles of

the Law of Aggregate Litig. § 3.07, comment a (2010)).

In this case, we do not need to decide if, or under what circumstances, parties

to a class-action settlement may agree to provide a payment to a third party without

a direct benefit to class members. Here, the financial payment to the third-party

organization is not the only, or perhaps even the primary, benefit of the settlement

agreement. All class members receive a direct benefit from the settlement: the

opportunity to license their publicity rights through the established Licensing Agency,

as well asthe payments by the NFL to the Licensing Agency. If the players' publicity

rights are as valuable as Appellants claim, the players should be able to realize the

value of their publicity rights through the Licensing Agency. While the parties

disagree on the value of the Licensing Agency to the different class members, the

district court held that through the Licensing Agency class members "finally ha[d] an

avenue to pursue commercial interests in their own images . . . [and] for the first time

in conjunction with the NFL's copyrights and trademarks." Dryer, 2013 WL

5888231, at *1. Thus, even in the absence of any financial payout, the settlement

would not fail as a matter of law. See, e.g., In re Mexico Money Transfer Litig., 267

F.3d 743, 748 (7th Cir. 2001) (noting that the settlement was "one of many class

actions in which everyone other than the plaintiffs has been paid in cash," that this

was "enough to raise suspicions" that the settlement may not be fair, but that the court

must "ask whether the value of relief in the aggregate is a reasonable approximation

of the value of plaintiffs' claim"); In re Gen. Motors Corp. Pick-Up Truck Fuel Tank

-10-
Prods. Liab. Litig., 55 F.3d 768, 803 (3d Cir. 1995) (noting concern that settlement

may not be fair because it "involve[d] only non-cash relief"). This is not a case in

which the district court approved a settlement with no direct benefit to each class

member.

Furthermore, although the $42 million is not paid directly to class members,

the money is clearly designated for the benefit of the class. The Common Good

Entity is obligated to "administer the [money] consistent with the provisions of [the]

Settlement Agreement" for the benefit of class members. In this way, the Common

Good Entity's administration of the substantial financial payout is not unlike the

establishment of a trust for the benefit of the class, which courts have frequently

found permissible. See, e.g., Cobell v. Salazar, 679 F.3d 909, 914 (D.C. Cir. 2012);

In re Diet Drugs Prods. Liab. Litig., No. 14-2729, 2015 WL 758455, at *1 (3d Cir.

Feb. 24, 2015); Int'l Union, United Auto., Aerospace, and Agric. Implement Workers

of Am., 497 F.3d 615, 624 (6th Cir. 2007); Fanning v. United States, 346 F.3d 386,

390 (3d Cir. 2003); Nat'l TreasuryEmps. Union v. United States, 54 Fed. Cl. 791, 795

(Fed. Cl. 2002). Therefore, we do not believe the mere fact that the financial payout

for the benefit of the class is made through a third party renders the settlement

impermissible. The relevant question isfor whom the money will be used, not whose

name appears on the check. Appellants cite to no authority holding to the contrary. 

Rather, they rely on cases involving cy pres distributions in which a district court

orders the payment of any unclaimed class funds to a third-party. Here, we deal not

3

At the district court, the objecting class members argued the settlement

3

agreement constituted a cy pres distribution. On appeal, no one expressly argues the

settlement is actually a cy pres distribution, and one set of appellants specifically

states they "wholeheartedly agree" with the district court that the settlement is not a

cy pres distribution.

"The cy pres doctrine originated as a rule of construction to save a testamentary

charitable gift that would otherwise fail, allowing 'the next best use of the funds to

satisfy the testator's intent as near as possible.'" In re Airline Ticket Comm'n

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with the court's authority to distribute unclaimed funds to a third party unrelated to

the class but the parties' ability to decide how to best distribute funds recovered in

a class action for the benefit of the class.

Courts have specifically found settlement agreements with a structure similar

to the one in this case as a permissible and favorable way to resolve complex

litigation disputes. For example, in Lane v. Facebook, the plaintiffs brought a class

action against Facebook and other corporate entities for Facebook's improper

publishing of private information regarding what its members did elsewhere on the

Internet. 696 F.3d 811, 816 (9th Cir. 2012), cert denied, 134 S. Ct. 8 (2013). 

Specifically, numerous company websites reported certain activity by customers to

Facebook; Facebook then published the activity on the member's profile page and

broadcast it for others to see. Id. The parties settled the class-action lawsuit under

a settlement agreement that required Facebook to pay $9.5 million, from which the

22 named class members received a total of $39,000, the 3,663,632 unnamed class

members received no payments at all, and the majority of funds went to establishing

a new charitable foundation that would help fund other organizations dedicated to

educating the public about online privacy. Id. at 817.

Antitrust Litig., 268 F.3d 619, 625 (8th Cir. 2001) (quoting Democratic Cent. Comm.

v. Washington Metro. Area Transit Comm'n, 84 F.3d 451, 455 n.1 (D.C. Cir. 1996)). 

In class-action litigation, it is commonly used to refer to the distribution of any

unclaimed class funds. Cf. In re BankAmerica Corp. Sec. Litig., 775 F.3d 1060, 1063

(8th Cir. 2015) ("In recent years, federal district courts have disposed of unclaimed

class action settlement funds after distributions to the class by making 'cy pres

distributions.'"); Klier v. Elf Atochem N. Am., Inc., 658 F.3d 468, 475 (5th Cir.

2011). The settlement agreement here did not provide for—nor did the district court

direct—that any unclaimed money be paid out to a non-class member. Therefore, we

do not believe the settlement agreement is a cy pres distribution merely because part

of the benefit through the settlement agreement is offered through a third-party

organization.

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The structure of the settlement agreement in Lane was in many ways similar

to the settlement in this case: it provided no direct financial payout to all class

members, save the named plaintiffs, and it paid the class funds to a newly-created

non-profit organization. It also differed in at least two key respects. First, the nonprofit organization in Lane was not obligated to spend any of the funds it received for

the benefit of any class members, which the court found made it a cy pres

distribution. Conversely, the Common Good Entity is bound to disburse the financial

payout by the NFL for the benefit of the class under specifically identified purposes. 

Second, the class members in Lane received no direct benefit whatsoever—financial

or otherwise. In contrast, even setting aside the benefit of the $42 million payout, all

class members here received the benefit of the Licensing Agency.

The settlement agreement in this case provided for a direct benefit to all class

members and a substantial financial payment by the NFL for the benefit of class

members. We do not believe it fails as a matter of law merely because it does not

provide a specific financial payout to each class member or because the financial

payment is made through a third-party organization. The settlement agreement

4

We also reject Appellants' argument that the district court's approval of the

4

settlement violates the Rules Enabling Act, codified in 28 U.S.C. § 2072.

Under the Rules Enabling Act, the Federal Rules of Civil Procedure "shall not

abridge, enlarge or modify any substantive right." 28 U.S.C. § 2072(b). Thus, a

district court, generally, may not award substantive relief in a class-action lawsuit

merely because it is brought in the context of a class action. However, Appellants

present no case holding that the Rules Enabling Act limits the type of relief parties

themselves may agree to, so long as the court remains convinced the settlement is

"fair, reasonable, and adequate." As noted above, a class-action settlement—like any

settlement—is a private contract of negotiated compromises. The agreement is not

a "substantive adjudication of the underlying causes of action," and therefore,

approval of the settlement agreement does not implicate the Rules Enabling Act. See

In re Baby Prods., 708 F.3d at 173 n.8 ("Because a district court's certification of a

settlement simply recognizes the parties' deliberate decision to bind themselves

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passed the district court'sscrutiny, and we find no evidence whatsoever that the court

failed to fulfil its duty to serve as a guardian for the rights of the absent class

members. Accordingly, we consider whether the district court abused its discretion

in finding the settlement agreement fair, reasonable, and adequate under the

traditional four-factor analysis.

A - The Defendant's Financial Condition

The district court found that the NFL is in good financial standing, which

would permit it to adequately pay for its settlement obligations or continue with a

spirited defense in the litigation. No party disagrees with this finding. As such, we

find this factor neutral.

B - The Complexity and Expense of Further Litigation

Class actions, in general, "place an enormous burden of costs and expense upon

[] parties." Schmidt v. Fuller Brush Co., 527 F.2d 532, 535 (8th Cir. 1975). Where,

as here, the class members' claims involve complex legal questions, conflicts of law

analyses, the application of numerous states' laws, and individualized damages for

each class member that are speculative and difficult to estimate, the enormity of the

burden is obvious.

according to mutually agreed-upon terms without engaging in any substantive

adjudication of the underlying causes of action, we do not believe the inclusion of a

cy pres provision in a settlement runs counter to the Rules Enabling Act." (internal

quotation marks and citation omitted)); Sullivan v. DB Invs., Inc., 667 F.3d 273, 312

(3d Cir. 2011) (en banc) ("[T]he proposed settlement could not violate the Rules

Enabling Act since a court's approval of a voluntary settlement, by nature a

compromise of rights, does not affect substantive state rights." (internal quotation

marks omitted)); cf. Klier, 658 F.3d at 482 (Jones, J. concurring) (suggesting that cy

pres distributions may violate the Rules Enabling Act when "judges award surplus

settlement funds to charities and civic organizations" (emphasis added)).

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Before settling, the parties had already spent three years in litigation and had

not yet even achieved class certification. As discussed in more detail below, the

resolution of the publicity rights claims would have required tremendous efforts

regarding issues of statutes of limitation for the various class members' home states,

complex conflict of laws analyses involving multiple states, the application of

numerous states' common and statutory publicity rights laws, affirmative defenses

involving constitutional principles, and the review of each individual player's

contract.

Even when the applicable law for each of the nearly 25,000 class members was

determined, the effort would have only began, asthe parties would have vociferously

disputed and fought over the amount of damages to which each class member was

entitled. Each class member's likeness was used in varying NFL Films' videos, in

varying frequency during those videos, and in varying focus. The discovery

associated with determining this would have been substantial to say the least. 

Furthermore, each class member's notoriety and recognition also varies. Thus, once

the partiesidentified and isolated each class member's appearancesin the videos, they

would have had to present evidence regarding what they believed such appearance

merited in value. Undoubtedly, each party would have obtained competent and

qualified (and expensive) experts to provide an evaluation on what each player's 

appearance during the varying NFL Films' videos was worth, but given the

speculative endeavor of such a task, the effort to reach an amount of damages for

each class member—to be persuasive—would have been substantial. Multiplying

that for the nearly 25,000 class members upgrades it to Herculean.

5

Appellants argue that, under restitutionary principles, damages can simply be 5

calculated by determining the amount of gain the NFL received by using the former

players' likenesses. Even assuming thatseparating the value ofthe players' likenesses

from the creative presentation and other unique elements of the NFL Films' videos

would be a more simplistic task, regardless of how the damagesfor all former players'

claims are calculated in the collective, to allocate the proceeds each individual player

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Finally, as the district court recognized, the fact that the NFL specifically

retained $13.5 million as a reserve for any litigation resulting from opt-outs is

strongly indicative that the realsum for the class-action litigation, particularly for the

plaintiffs who carried the burden of proving their damages, would have been much

higher.

Therefore, the district court correctly reasoned that this factor heavily favors

approval of the settlement agreement.

C - Amount of Opposition to the Settlement

The weight of thisfactor depends upon the viewpoint of the opposition. When

the opposition is considered from the view of the named plaintiffs, the amount is

considerable: six of the twenty-three class representatives objected to the settlement. 

When considered from the viewpoint of the entire class, it is not substantial—less

than ten percent of the class opted out of the settlement. We have previously

approved class-action settlements even when almost half the class objected to it. See,

e.g., VanHorn, 840 F.2d at 606 (180 of 400 inmates objecting). We have approved

a class-action settlement even when all named plaintiffs opposed it. See Elliott v.

Sperry Rand Corp., 680 F.2d 1225, 1226-27 (8th Cir. 1982) (finding no abuse of

discretion even though both named plaintiffs objected to it and 790 of approximately

3,000members objected). While Appellants fault the district court for failing to agree

with them, it is clear the district court listened to all of their objections, carefully

considered them, and explained its rationale for rejecting them.

The fact that a considerable number of the named plaintiffs objected to the

settlement suggestsit may not have been particularly favorable to what they believed

is entitled, the court would still need to determine each player's entitlement based on

the use and value of his likeness individually.

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their particular claims were worth. The fact that less than ten percent of the entire

class opted out of the settlement—despite conscious efforts by some class members

to persuade the other class members of unfairness—suggestsit wasfavorable to what

most members believed their claims were worth. The named plaintiffs were likely

some of the individuals who by settling were giving up the greatest potential direct

financial payout. But they were not required to forgo what they believed to be

meritorious claims—they could have opted out of the settlement to pursue their own

claims, as some class members did.

The district court was keenly aware of its role to serve as the guardian of the

absent class members, which was "especially important [in this case], given the

rhetoric and conflict among the members of the Settlement Class, who in the usual

case would be zealously protecting those rights." Dryer, 2013 WL 5888231, at *2. 

It is obvious that in approving the settlement, the district court overwhelmingly

believed the settlement was fair, reasonable, and adequate for the majority of the

class, which happened to be the quiet, absent majority:

[T]he objectors want a financial payout more than they want to embrace

the reality of the limitations of their claims. Fortunately for the absent

class members, experienced counsel and a knowledgeable and extremely

capable Magistrate Judge saw the case for what it was, and negotiated

a settlement that is truly one-of-a-kind, and a remarkable victory for the

class as a whole.

Id. The district court refused to give credence to the vocal minority that focused on

receiving a direct financial payout, which the district court believed was a "very

mistaken belief that they could reap significant financial benefits fromcontinuing this

case." Id. Indeed, the court aptly noted that "only one-tenth of one percent of the

class objected, and less than ten percent of the class ha[d] requested exclusion from

the settlement." Id. This was in accord with the district court's "duty to the silent

majority as well as the vocal minority." In re Wireless, 396 F.3d at 933.

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Under the specific circumstances of the class claims and disparity in the

potential payout for individual damages at issue in this case, and the posture in which

they were litigated, we believe the amount of opposition from the substantial absent

majority is better indicative of the opposition to the settlement as a whole. 

Accordingly, we find this factor, too, favors approval of the settlement agreement.

D - The Merits of the Plaintiffs' Case Weighed Against the Terms of the

Settlement

The most important consideration in the analysis requires balancing the

strength of the plaintiffs' case against the value of the settlement terms to the class. 

The district court held "there is no question that the factor weighs heavily in favor of

the settlement." Dryer, 2013 WL 5888231, at *4.

1 - The Merits of the Plaintiffs' Case

The district court held "the chances that this lawsuit—or indeed any

class-action lawsuit seeking to recoup sums for the alleged infringement of former

NFL players' publicity rights by NFL Films—will succeed are slim at best" because

"[t]oo many obstacles stand in the way of that success." Id. at *2. Those obstacles

come in the form of four barriers: (1) statute of limitations; (2) issuesrelated to class

certification; (3) plausible affirmative defenses; and (4) lack of substantial damages

for most of the class.

First, because of the six-year statute of limitations "no Plaintiff [was] entitled

to compensation for any unauthorized use of his image before 2003." Id. at *4. Thus,

"the statute of limitations would bar the claims of many members." Id. No one

disputes this limitation.

-18-
Second, the district court convincingly explained its many concerns with

potential class certification. For instance, the district court rejected the notion that

New Jersey law would apply for all plaintiffs' publicity rights claims and believed it

would need to apply Minnesota conflict of laws to determine if there is a conflict

among the states' laws, which may include the laws of the states in which the

plaintiffs reside, in which the plaintiffs played football, under which the contracts are

governed, and the home states of the NFL and NFL Films. Some of these states

provide for publicity rights by statute, some by common law, while some do not

recognize any such rights. In the states that recognize such a cause of action, some

states treat it as a tort, while others treat it as a property right. Because the district

court would be required to apply individualized choice-of-law analysis for each

plaintiff's claim in the class action, see Phillips Petroleum Co. v. Shutts, 472 U.S.

797, 822-23 (1985), the district court found that with a class of nearly 25,000

individuals, "the choice-of-law inquiry [would be] extremely complex and weighs

heavily against ultimate certification of the class." Dryer, 2013 WL 5888231, at *5. 

In addition, the question of damages for each player is highly individual. How often

they appeared, in what capacity, and, most importantly, what the value is of their

appearance will be very dependant on each individual class member.

Third, the NFL advanced plausible affirmative defenses that may have entirely

precluded any recovery. For example, the NFL reiterates on appeal, with supporting

evidence, thatformer NFL players understood and consented to the NFL's use oftheir

likenesses for many years and even provided voluntary interviews to be used in the

NFL Films' videos. The NFL also argued the NFL Films' videos are "entertainment

programming, not commercial speech," and are thus subject to First Amendment

protection. In a litigation in California state court involving similar issues, the court

denied class certification and eventually found that the use of baseball players'

publicity rights was protected by the First Amendment. See Gionfriddo v. Major

League Baseball, 114 Cal. Rptr. 2d 307, 318 (Cal. Ct. App. 2001) ("Balancing

plaintiffs' negligible economic interests against the public's enduring fascination with

-19-
baseball's past, we conclude that the public interest favoring the free dissemination

of information regarding baseball's history far outweighs any proprietary interests at

stake."). In finding that the First Amendment barred baseball players' right of

publicity claims for the use of their names, likenesses, and statistics in fantasy

baseball games, this Court found the reasoning in Gionfriddo persuasive. See C.B.C.

Distrib. and Mktg., Inc. v. Major League Baseball Advanced Media, L.P., 505 F.3d

818, 823 (8th Cir. 2007) ("The Supreme Court has directed that state law rights of

publicity must be balanced against first amendment considerations, see Zacchini v.

Scripps-Howard Broad., 433 U.S. 562 (1977), and here we conclude that the former

must give way to the latter."). As discussed below, the district court, in dismissing

the claims of the members who opted out of the class, found these and other defenses

meritorious.

Finally, even if the plaintiffs obtained class certification and overcame all of

the NFL's affirmative defenses, for most, the damage potential was not particularly

large. The district court recognized that for a few members of the class, the potential

could be "substantial." For many, however, the payout would be minimal. Indeed,

the court noted the lack of "likelihood of any individual incurring enough damages

on their claims to make pursuit of individual actions worthwhile." Dryer, 2013 WL

5888231, at *7 n.2. Moreover, any damage calculation for the value of publicity

rights for minor appearances during an NFL Films' video would be very speculative:

Plaintiffs played a team sport, where at any given time there are 22 men

on the field of play. Any image from a game would almost by necessity

include more than one individual and often includes many individuals. 

The apportionment of publicity-rights damages among the individuals

featured—whether players, coaches, sideline workers, officials,

cheerleaders, or others—is a Herculean task.

Id. at 7. Therefore, if Appellants are wrong about their likelihood of success along

any step of the way, all plaintiffs will gain nothing and lose not only the benefit of

-20-
a large sum of money devoted to them but also the benefits offered by the Licensing

Agency. Appellants, who believe they are due a substantial payout, still argue they

would have been better off without settlement because they were likely to prevail at

trial and obtain substantial damages. We have repeatedly rejected arguments "that

compromise was unnecessary because [the party] would have prevailed at trial." 

Prof'l Firefighters Ass'n of Omaha, Local 385 v. Zalewski, 678 F.3d 640, 649 (8th

Cir. 2012). Appellants Marcus D. Gastineau and Abdul Salaam argue they "have

compromised claims against the NFL that have substantially greater value than retired

players whose game footage has never been used by the NFL." But if Gastineau and

Salaam were so confident in the likelihood of a substantial payout for their claims,

they could have opted out of the settlement to pursue their own claims, as some class

members did.

In fact, the three appellants who opted out of the settlement and proceeded to

the merits of their claims had their claims entirely dismissed by the district court. In 6

the order granting summary judgment in favor of the NFL, the court found that the

NFL Films' videos were not commercial speech and that after "[a]n evaluation[, ] the

full record show[ed] that the balance between Plaintiffs' publicity rights and the

constitutional protection due the usesinvolved here tip[ped] decidedly in favor of the

NFL." Dryer v. Nat'l Football League, No. 09-2182 (PAM/FLN), 2014 WL 5106738,

at *10 (D. Minn. Oct. 10, 2014). Moreover, the court concluded that even if the

videos were commercial speech, the plaintiffs still failed to demonstrate "genuine

issues of fact in the record to establish their publicity-rights claims." Id. at *11. 

Notably, the court also rejected the plaintiffs' argument that New Jersey law should

Other former NFL players who opted out of the settlement initiated actions in 6

different districts, which were then transferred to the District of Minnesota. See Culp

v. NFL Prods., LLC, No. 13-7815 (NLH/JS), 2014 WL 4828189, at *1 (D.N.J. Sept.

29, 2014); Thompson v. Nat'l Football League, No. 1:13-CV-00367, 2014 WL

1646929, at *1 (W.D. Pa. Apr. 24, 2014); Tatum v. Nat'l Football League, No. 2-13-

CV-01814, 2014 WL 1652794, at *1 (W.D. Pa. Apr. 24, 2014).

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apply to their claims, instead considering California, Texas, Minnesota, and New

York law. Id. at *11-12. After applying the relevant state law, the court found that

every state's law regarding the newsworthiness defense barred every plaintiff's

publicity claims. Id. at *12-15. The court also concluded that every state's law

regarding consent barred the plaintiffs' publicity claims. Id. at *15-16. Similarly, the

court held that the "NFL's valid copyright in the game footage forecloses Plaintiffs'

publicity claims." Id. at *17. Finally, the court concluded that the plaintiffs' Lanham

7

Act claims failed because the NFL Films' videos were not commercial speech, and

even if they were, the use of plaintiffs' likenesses were in no way false or misleading. 

Id. at *18. In summary, the district court rejected every single one of the plaintiffs'

claims under every state law and under every single theory and defense. While the

merits of the order granting summary judgment are not before us in this appeal, the

8

district court's order is nevertheless strong evidence that it meant what it said in its

order approving the settlement regarding the likelihood of success on the merits.

The district court carefully and thoughtfully considered the strength of the

plaintiffs' case and all of the potential risks they would face by continuing to litigate. 

Since the district court would have been the one to decide the issues, though it did not

have the benefit of full briefing on all issues at the time and could have changed its

mind, it was in the best position to forecast the likely outcome on the issues that

would come before it. Its decision is entitled to deference.

We note that we recently affirmed the dismissal of a plaintiff's publicity rights

7

claims on the basis that they were preempted by the Copyright Act. See Ray v.

ESPN, Inc., No. 14-2117, 2015 WL 1810486, at *3 (8th Cir. Apr. 22, 2015) (holding

that "Ray's likenesses could not be detached from the copyrighted performances that

were contained in the films").

The merits of the order are presently before us in a separate appeal. See No. 8

14-3428. Nothing in our analysis here should be taken as an indication of how the

merits of the issues will ultimately be decided.

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2 - Value of the Settlement Terms to the Class

Appellants first argue that the district court could not approve the settlement

without a specific value for the expected amount of recovery on the class members'

claims. Second, they argue the settlement offers insufficient value to the class. We

address each argument in turn.

With respect to the first argument, the Ninth Circuit rejected this exact

argument in Lane: "we reject Objectors' argument insofar as it stands for the

proposition that the district court was required to find a specific monetary value

corresponding to each of the plaintiff class's statutory claims and compare the value

of those claims to the proffered settlement award." Lane, 696 F.3d at 823. The court

reasoned that while the district court carries an obligation to evaluate the strength of

the plaintiffs' case relative to the risks of continued litigation, "it need not include in

its approval order a specific finding of fact asto the potential recovery for each of the

plaintiffs' causes of action." Id. Such a requirement would "often be impossible." 

Id. Thus, the district court's obligation was to evaluate "the plaintiffs' case in its

entirety rather than on a claim-by-claim basis." Id.

Appellants argue, and some courts have called for, a more detailed evaluation

of the value of class claims. For example, one of the factors adopted in other circuits

in evaluating the fairness, reasonableness, and adequacy of a class settlement is "the

range of reasonableness of the settlement fund in light of the best possible recovery." 

Girsh v. Jepson, 521 F.2d 153, 157 (3d Cir. 1975) (quoting City of Detroit v. Grinnell

Corp., 495 F.2d 448, 463 (2d. Cir. 1974)). But this is not a required finding in this

Circuit. Similarly, the Seventh Circuit has criticized district courts' failure to

adequately valuate the potential ofthe plaintiffs' claims: "the judge should havemade

a greater effort (he made none) to quantify the net expected value of continued

litigation to the class . . . . Determining that value would require estimating the range

of possible outcomes and ascribing a probability to each point on the range." 

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Reynolds v. Beneficial Nat'l Bank, 288 F.3d 277, 284-85 (7th Cir. 2002). However,

the Seventh Circuit also acknowledged that "[a] high degree of precision cannot be

expected in valuing a litigation, especially regarding the estimation of the probability

of particular outcomes." Id. at 285. The court suggested, as an example, that "the

judge could have insisted that the parties present evidence that would enable four

possible outcomes to be estimated: call them high, medium, low, and zero." Id. at

285. The judge could have then estimated an "approximate range of percentages,

reflecting the probability of obtaining each of these outcomes in a trial (more likely

a series of trials)" for each outcome to derive a "ballpark valuation." Id. The Ninth

Circuit has expressly criticized such a detailed approach as a requirement. See

Rodriguez v. West Publ'g Corp., 563 F.3d 948, 965 (9th Cir. 2009) (citing Seventh

Circuit law and rejecting the notion that "the court should have specifically weighed

the merits of the class's case against the settlement amount and quantified the

expected value of fully litigating the matter"). The Third Circuit has also

acknowledged that requiring a detailed and involved calculus for the expected

recovery is not always possible:

We note that in some cases, 'the traditional calculus suggested by the

Manual for Complex Litigation . . . and adopted by [us] cannot be

applied' [because] . . . calculating the value of the best possible recovery

would have been 'exceedingly speculative' and both the structure of the

settlement and the uncapped benefit [can make] it 'difficult to determine

accurately the actual value of the settlement.'

In re Pet Food Prods. Liab. Litig., 629 F.3d 333, 355 n.30 (3d. Cir. 2010) (alterations

in original).

Although this Court has not specifically defined how much precision a district

court must use in evaluating the strength of the plaintiffs' case, we have previously

explained that "in approving a settlement[,] the district court need not undertake the

type of detailed investigation that trying the case would involve." Van Horn, 840

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F.2d at 607. We see no need to adopt the Seventh Circuit's approach in this case. In

a case such as this one, where the damages are not easily calculable, are highly

speculative, and are heavily dependent on expert opinions, it would be difficult if not

impossible to derive the initial high, medium, low, and zero for potential value of the

claims in such an accurate way as to allow for a meaningful conclusion. In so doing,

we do not mean to discourage district courts from requiring parties to provide

valuations for the class claims; rather, we leave the required level of detail for such

a showing in each case to the sound discretion of the district court. To require the

district court to make detailed factual findings on the value of class claims in every

case, even if it would ultimately find any of its findings of little value to evaluating

the fairness, reasonableness, and adequacy of the settlement would run counter to this

Court's guiding principle that "[t]he very purpose of compromise isto avoid the delay

and expense of such a trial," Grunin, 513 F.2d at 124 (internal quotation marks

omitted) and that "[t]he parties to a class action are not required to incur immense

expense before settling as a means to justify that settlement." DeBoer v. Mellon

Mortg. Co., 64 F.3d 1171, 1178 (8th Cir. 1995).

Here, there wassome evidence in the record on the value of the claims. As part

of the settlement process, the Magistrate Judge required the parties to provide a

"concise summary of [their] analysis of the damages issues" and other confidential

financial information. At oral argument, lead settlement counsel provided further

details regarding the evidence presented to the Magistrate Judge, which included colead plaintiffs' counsel's calculated estimate of a range of damages based on a nineyear period from financial records produced by the NFL thus far. Because the

Magistrate Judge was part of the district court, and was tasked with conducting the

settlement discussions between both parties in an effort to achieve a mutuallyagreeable resolution, the district court held that "[w]hen information is submitted to

[him], it is submitted to this Court." Dryer, 2013 WL 5888231, at *4. Additionally,

as part of their objections to the settlement, Appellants provided the declaration of

Carl G. Degan, an economic damages expert. Degan explained several complex

-25-
formulas and alternativesthrough which he believed it would be feasible to calculate

damages and also included a seven-page analysis on what he believed to be the value

of the claims relative to the settlement. The information was available to the district

court, and the district court was entitled to afford it whatever weight it found

appropriate. Interestingly, although Degan was asked to "evaluate the proposed

settlement value vis-à-vis potential damages," he failed to provide any opinion on the

specific value of the class claims—he merely opined the settlement was too small. 

The absence of a specific value in his declaration is hardly surprising since to attempt

to reach such specific value of the class claims, the parties would have needed full

and complete discovery of the NFL's finances, a comprehensive review of the

substantial amount of evidence with regard to each ofthe nearly 25,000 members, and

expensive expert reports to support the conclusions reached. Requiring the parties

to undergo such an elaborate and expensive process to produce what likely would

have been two opposing speculative estimates far apart seems to be of little value in

this case—especially considering that the process may have unraveled the potential

for settlement. Taking into account that any derived expected value of the claims

must be weighed against the likelihood of success on the merits, which is even more

difficult to quantitatively measure in this case, reaffirms that a more specific valuation

of the claims in this particular case was not required. Therefore, the district court did

not err by not requiring additional expert evidence on the issue. We have more than

enough of a "basis for determining that [the district court's] decision rests on 'wellreasoned conclusions' and is not 'mere boilerplate.'" In re Wireless, 396 F.3d at 933.

We also reject the argument that the settlement offers insufficient value to the

class. As already noted, the settlement agreement provides for two clear and direct

benefits to the class: the Licensing Agency and the payment of up to $42 million for

the benefit of the class.

The Licensing Agency created by the settlement agreement is an agency which

allows for one-stop shopping for those seeking to obtain the publicity rights of former

-26-
NFL players. Its purpose is to assist former players in identifying and securing

business opportunities for licensing. The settling plaintiffs believe the Licensing

Agency "willsignificantly reduce transaction costs and unlock the value of the group

publicity rights of Class Members." Appellants argue the Licensing Agency does not

provide much benefit because former players can license their likenessesthrough the

NFL Alumni Association's group-licensing program. But regardless of whether some

benefits might be duplicative, the Licensing Agency offers unique benefits such as

the promised cooperation from the NFL in licensing its logos and trademarks. Thus,

the Licensing Agency is a significant and direct benefit to all class members. 

Moreover, the precise value of the benefit from the Licensing Agency was for the

district court to consider in the first instance, and the district court found it valuable: 

"former players will also finally have an avenue to pursue commercial interests in

their own images and in their images as part of their former teams, for the first time

in conjunction with the NFL's copyrights and trademarks . . . ." Dryer, 2013 WL

5888231, at *1. As the district court summarized, "should the Licensing Agency be

unable to market individual and group publicity rights because of lack of market

demand, then it is clear that the class did not truly suffer the damages alleged in this

case." Id. at *7.

In addition to the benefits of the Licensing Agency, the class members have

$42 million for their benefit. Although the money is not paid directly to any specific

player and does not guarantee any specific amount to any specific player, the clearly

stated purpose of the funds is to benefit the class. As the district court explained, the

payout is "a boon to those thousands upon thousands of former NFL players who can

now reap the collective benefit of a large financial payout to a fund organized solely

for their benefit, overseen by their comrades-in-arms." Id. at *1.

While Appellants may not believe they received adequate value for what they

believe their own individual claims were worth, in evaluating the strength of the

plaintiffs' case and the potential value, the district court must take into account the

-27-
interests of the entire class—not merely the named plaintiffs. Thus, it must balance

the claims of those with potentially substantial damages to those with potentially

minimal or insignificant damages. "It is an inherent feature of the class-action device

that individual class members will often claim differing amounts of damages." Lane,

696 F.3d at 824. This issue is apparent here, and the district court astutely took notice

of it by explaining that one of the named plaintiffs, who "was featured in at least one

NFL Films' production," stood to gain "relatively substantial" damages, assuming

they were not barred by the statute of limitations or the NFL's other affirmative

defenses. Dryer, 2013 WL 5888231, at *7. Conversely, "[a] member of the defensive

squad for the 1986 Super Bowl runner-up New England Patriots, . . . might appear

briefly in a documentary about the Super-Bowl-winning Chicago Bears, but that

image would be fleeting and entitled to little, if any, compensation." Id. Thus, in

reaching the settlement, some members would potentially be foregoing a larger

payment than others, were they to prevail on the claims. Were such members

required to entirely forgo their claims, the settlement may be unfair. But there is a

well-established remedy that any class member may elect to preserve what he believes

to be a claim worth more than what he may receive under the settlement—opt out. 

As the Lane court explained, this is "why due process requires that individual

members of a class certified under Rule 23(b)(3) be given an opportunity to opt out

of the settlement class to pursue their claims separately." 696 F.3d at 824. This

important procedural right acknowledges the practical reality that "a class action

settlement necessarily reflects the parties' pre-trial assessment as to the potential

recovery of the entire class, with all of its class members' varying claims." Id.

Additionally, the NFL specifically reserved $13.5 million fromthe $42 million

payment for any expenses related to opt-out litigation, expecting some individuals to

opt out. The plaintiffs who opted out of the settlement could have brought their own

individual or collective action against the NFL and potentially obtained the direct

financial payout they allege is lacking in this settlement. In fact, three of the

individuals who opted out had their claims dismissed with no recovery at all.

-28-
Appellants also argue the initial denial of preliminary approval for the NFL's

concussion litigation settlement demonstratesthe unreasonableness of the settlement

in this case. See In re Nat'l Football League Players' Concussion Injury Litig., 961

F. Supp. 2d 708 (E.D. Pa. 2014). The concussion litigation involves different claims,

subject to different risks, defenses, and likelihood of success, different class

members, and different potential damages. The mere fact that the litigation involves

similar parties in no way serves as a useful comparison in evaluating the

reasonableness of the settlement for the claims at issue in this case.

In the district court's evaluation, this action involved dubious claims with

highly speculative damages that were unlikely to be addressed in the context of

class-action litigation. For the majority of the class, the current settlement provides

a substantial benefit through the Licensing Agency and a payout of up to $42 million

through the Common Good Entity. The district court believed the negotiated

settlement is "a remarkable victory for the class as a whole." Dryer, 2013 WL

5888231, at *2. Under our deferential review, we cannot say the district court made

a clear error of judgment in weighing the relevant factors. Accordingly, we do not

believe the district court abused its discretion in approving the settlement. See In re

Wireless, 396 F.3d at 933 ("Weighing the uncertainty of relief against the immediate

benefit provided in the settlement, we conclude that the district court acted within its

discretion when considering the strength of the claims and the amount of the

settlement.").

III

We find that the district court properly considered the relevant factors and did

not abuse its discretion in finding that the negotiated settlement agreement in this case

was fair, reasonable, and adequate to the class. Therefore, we affirm.

-29-
SMITH, Circuit Judge, concurring.

I concur in the court's opinion. I write separately to emphasize that this class

action settlement is not a cy pres distribution like the distribution in In re

BankAmerica Corp. Securities Litigation. 

"The term 'cy pres' is derived from the Norman French expression cy pres

comme possible, which means 'as near as possible.'" In re Baby Prods., 708 F.3d at

168 (footnote omitted)(quoting DemocraticCent. Comm. v. Washington Metro. Area

Transit Comm'n, 84 F.3d 451, 455 n.1 (D.C. Cir. 1996)). The Third Circuit has

described the traditional cy pres distribution in the class-action context as follows:

When class actions are resolved through settlement, it may be difficult

to distribute the entire settlement fund, after paying attorneys' fees and

costs along with fund administration expenses, directly to its intended

beneficiaries—the class members. Moneymay remain unclaimed if class

members cannot be located, decline to file claims, have died, or the

parties have overestimated the amount projected for distribution for

some other reason. It may also be economically or administratively

infeasible to distribute funds to class members if, for example, the cost

of distributing individually to all class members exceeds the amount to

be distributed. In these circumstances, courts have permitted the parties

to distribute to a nonparty (or nonparties)the excess settlement funds for

their next best use—a charitable purpose reasonably approximating the

interests pursued by the class.

Id. at 168–69. 

"We have approved cy pres distribution of unused or unclaimed class action

settlement funds" in accordance with the criteria set forth "in § 3.07 of [the American

Law Institute's (ALI)] published Principles of the Law of Aggregate Litigation

-30-
(2010)." In re BankAmerica Corp. Sec. Litig., 775 F.3d at 1063–64. Section 3.07

provides:

"A court may approve a settlement that proposes a cy pres remedy . . . .

The court must apply the following criteria in determining whether a cy

pres award is appropriate:

(a) If individual class members can be identified through reasonable

effort, and the distributions are sufficiently large to make individual

distributions economically viable, settlement proceeds should be

distributed directly to individual class members.

(b) If the settlement involves individual distributions to class members

and funds remain after distributions(because some class members could

not be identified or chose not to participate), the settlement should

presumptively provide for further distributions to participating class

members unless the amounts involved are too small to make individual

distributions economically viable or other specific reasons exist that

would make such further distributions impossible or unfair.

(c) If the court finds that individual distributions are not viable based

upon the criteria set forth in subsections (a) and (b), the settlement may

utilize a cy pres approach. The court, when feasible, should require the

parties to identify a recipient whose interests reasonably approximate

those being pursued by the class. If, and only if, no recipient whose

interest reasonably approximate those being pursued by the class can be

identified after thorough investigation and analysis, a court may approve

a recipient that does not reasonably approximate the interests being

pursued by the class."

Id. (alteration in original) (quoting ALI, Principles ofthe Law of Aggregate Litigation

§ 3.07 (2010)). 

We recently "clarifi[ed] the legal principles" that govern cy pres distributions.

Id. at 1064.

-31-
First, we agree[d] with the Fifth Circuit that, "Because the settlement

funds are the property of the class, a cy pres distribution to a third party

of unclaimed settlement funds is permissible 'only when it is not feasible

to make further distributions to class members' . . . . except where an

additional distribution would provide a windfall to class members with

liquidated-damages claims that were 100 percent satisfied by the initial

distribution."

Id. (second alteration in original) (quoting Klier, 658 F.3d at 475 (quoting ALI

§ 3.07)). 

"Second, a cy pres distribution is not authorized by declaring . . . that 'all class

memberssubmitting claims have been satisfied in full.'" Id. at 1065 (citation omitted).

Third, "'[a] proposed cy pres distribution must meet [ourstandards governing cy pres

awards] regardless of whether the award was fashioned by the settling parties or the

trial court.'" Id. at 1066 (alterations in original) (quoting Nachshin v. AOL, LLC, 663

F.3d 1034, 1040 (9th Cir. 2011)). Fourth, "unless the amount of funds to be

distributed cy pres is de minimis, the district court should make a cy pres proposal

publicly available and allow class membersto object orsuggest alternative recipients

before the court selects a cy presrecipient." Id. "Fifth, when a district court concludes

that a cy pres distribution is appropriate after applying the foregoing rigorous

standards, such a distribution must be 'for the next best use . . . for indirect class

benefit,' and 'for uses consistent with the nature of the underlying action and with the

judicial function.'" Id. at 1067 (alteration in original) (quoting In re Katrina Canal

Breaches Litig., 628 F.3d 185, 196 (5th Cir. 2010)). 

We applied these legal principles in In re BankAmerica Corp. Securities

Litigation in reviewing a class action settlement that was indisputably a cy pres

distribution. See id. at 1062. In that case, the district court ordered, over the class

representative's objections, "that the balance of the NationsBank Classes settlement

fund shall be distributed cy pres to the Legal Services of Eastern Missouri, Inc." Id.

-32-
(quotation and citation omitted). We reversed, agreeing with the class representative

that, applying the legal principles set forth supra, "the district court abused its

discretion in ordering a cy pres distribution because a further distribution to the

classes is feasible, and in any event [the selected charity] [was] unrelated to the

classes or the litigation and [was] therefore an inappropriate 'next best' cy pres

recipient." Id. at 1062 (footnote omitted). 

Our threshold question is whether the proposed settlement is a cy pres

distribution at all. I conclude that it is not. In cy pres distributions, settlement funds

are distributed to nonparties. Here, the Common Good Fund must be used to provide

benefits to class members, rather than being given to nonparties unrelated to the

litigation. And, the Common Good Fund and Common Good Entity are governed by

a Board of Directors that includes class members. Furthermore, this case does not

concern "unused or unclaimed class action settlement funds." Id. at 1064. In fact,

unused funds will never exist here because if the Common Good Entity does not

timely distribute the settlement funds, the NFL must do it. Finally, this case is

distinguishable from In re BankAmerica Corp. Securities Litigation because, in that

case, we had to determine how to handle leftover funds in a cash settlement; here, the

question is whether a settlement must provide direct cash payments at all.

Accordingly, In re BankAmerica Corp. Securities Litigation does not control the

disposition of the current appeal.

______________________________

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