Alan E. Sash 

Lee S. Shalov 

MCLAUGHLIN & STERN LLP

260 Madison Ave. 

New York, NY 10016 

T: 646-278-4298 

F: 212-448-0066 

Angela Edwards 

LAW OFFICE OF ANGELA EDWARDS

72 Canterbury Circle 

East Longmeadow, MA 01028 

T: 413-525-3820 

Andrew N. Friedman 

Whitney R. Case 

COHEN MILSTEIN SELLERS & TOLL 

PLLC 

1100 New York Ave., N.W., Suite 500W 

Washington, D.C. 20005 

T: 202-408-4600 

F: 202-408-4699 

Attorneys for Plaintiffs

on behalf of themselves and all others 

similarly situated.

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF NEW JERSEY 

-------------------------------------- X 

SUSAN SABOL, VALERIE DONE, and 

KATHLEEN KLODNER on behalf of 

themselves and all others similarly situated, 

Plaintiffs, 

-againstHYDROXATONE, LLC and ATLANTIC 

COAST MEDIA GROUP 

Defendants. 

:

:

:

:

:

:

CIVIL ACTION NO. 

2:11-cv-04586-SRC-MAS 

MEMORANDUM IN SUPPORT OF 

PLAINTIFFS’ MOTION FOR ENTRY 

OF AN ORDER GRANTING 

PRELIMINARY APPROVAL OF THE 

CLASS SETTLEMENT AND 

APPROVING THE FORMS OF 

NOTICE TO THE CLASS 

-------------------------------------- X 

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TABLE OF CONTENTS 

Page 

i 

PRELIMINARY STATEMENT .................................................................................................... 1

FACTUAL BACKGROUND ......................................................................................................... 1

THE PROPOSED SETTLEMENT................................................................................................. 3

NOTICE TO THE CLASS ............................................................................................................. 6

ARGUMENT .................................................................................................................................. 7

I. THE STANDARD FOR PRELIMINARY APPROVAL OF CLASS 

SETTLEMENTS................................................................................................................. 7

II. THE PROPOSED SETTLEMENT EASILY PASSES THE PRELIMINARY 

FAIRNESS DETERMINATION........................................................................................ 9

A. The Proposed Settlement is the Result of an Arm’s-Length Negotiation 

and Therefore Satisfies the Procedural Component for Preliminary 

Approval ............................................................................................................... 10

B. The Discovery In This Case Was Sufficient For the Parties to Determine 

the Basic Facts and the Scope of the Litigation .................................................... 10

C. Counsel Are Highly Experienced in Class Action Litigation ............................... 11

D. The Ability of Defendants to Withstand a Greater Judgment ............................... 11

III. THE PROPOSED NOTICE IS ADEQUATE UNDER RULE 23(C)(2) ......................... 11

IV. THE CASE IS APPROPRIATE FOR CERTIFICATION OF A SETTLEMENT 

CLASS .............................................................................................................................. 13

A. Numerosity Under Rule 23(a)(1) .......................................................................... 13

B. Commonality Under Rule 23(a)(2). ..................................................................... 14

C. Typicality Under Rule 23(a)(3) ............................................................................ 15

D. Adequacy of Representation Under Rule 23(a)(4). .......................................... 15

E. The Requirements of Rule 23(b)(3) Are Met .................................................. 16

F. Final Approval Hearing Should be Scheduled ................................................. 18

V. CONCLUSION ................................................................................................................. 18

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TABLE OF AUTHORITIES 

Page(s) 

CASES

In re Am. Med. Sys., Inc., 

75 F.3d 1069 (6th Cir. 1996) ...................................................................................................16 

Amchem Prods. v. Windsor, 

521 U.S. 591 (1997) ...........................................................................................................13, 16 

In re Cendant Corp. Litig., 

264 F.3d 201 (3d Cir. 2001).....................................................................................................11 

In re Countrywide Fin. Corp. Customer Data Sec. Breach Litig., 

2009 U.S. Dist. LEXIS 119870 (W.D. Ky. Dec. 22, 2009) ...................................12, 15, 16, 17 

Curiale v. Lenox Grp., Inc., 

No. 07-1432, 2008 U.S. Dist. LEXIS 92851 (E.D. Pa. Nov. 14, 2008) ....................................9 

DeBoer v. Mellon Mortg. Co., 

64 F.3d 1171 (8th Cir. 1995) ...................................................................................................12 

Dewey v. Volkswagen of Am., 

728 F. Supp. 2d 546 (D.N.J. 2010) ....................................................................................13, 17 

Ehrheart v. Verizon Wireless, 

609 F.3d 590 (3d Cir. 2010).....................................................................................................18 

Farinella v. PayPal, 

611 F. Supp. 2d 250 (E.D.N.Y. 2009) .....................................................................................12 

Fidel v. Farley, 

534 F.3d 508 (6th Cir. 2008) ...................................................................................................12 

Gates v. Rohm and Haas Co., 

248 F.R.D. 434 (E.D. Pa. 2008) ...............................................................................................10 

In re Gen. Motors Corp. Pick-Up Truck Fuel Tank Prods. Liab. Litig., 

55 F.3d 768 (3d Cir. 1995).........................................................................................................8 

Girsh v. Jepson, 

521 F.2d 153 (3d Cir. 1975).......................................................................................................9 

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In re Grand Theft Auto Video Game Consumer Litig., 

251 F.R.D. 139 (S.D.N.Y. 2008) .............................................................................................12 

Hanlon v. Chrysler Corp., 

150 F.3d 1011 (9th Cir. 1998) .................................................................................................13 

Inmates of the Northumberland Cnty. Prison v. Reish, 

No. 08-cv-345, 2009 U.S. Dist. LEXIS 126479 (M.D. Pa. Mar. 17, 2009) ............................15 

In re Inter-Op Hip Prosthesis Liab. Litig., 

204 F.R.D. 359 (N.D. Ohio 2001) .............................................................................................8 

Jones v. Commerce Bancorp, Inc., 

No. 05-5600 (RBK), 2007 U.S. Dist. LEXIS 52144 (D. N.J. July 16, 2007) ............................9 

Lucas v. Kmart Corp., 

234 F.R.D. 688 (D. Colo. 2006) ................................................................................................9 

Marcus v. BMW of N. Am., LLC, 

No. 08-5859 (KSH), 2010 U.S. Dist. LEXIS 122908 (D.N.J. Nov. 19, 2010) ........................13 

Mehling v. N. Y. Life Ins. Co., 

246 F.R.D. 467 (E.D. Pa. 2007) .................................................................................................8 

Mullane v. Cent. Hanover Bank & Trust Co., 

339 U.S. 306 (1950) .................................................................................................................12 

Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 

259 F.3d 154 (3d Cir. 2001).....................................................................................................15 

In re OSB Antitrust Litig., 

No. 06-826, 2007 U.S. Dist. LEXIS 56584 (E.D. Pa. Aug. 3, 2007) ......................................14 

Petrovic v. AMOCO Oil Co., 

200 F.3d 1140 (8th Cir. 1999) .................................................................................................12 

In re Prudential Ins. Co. Am. Sales Practice Litig. Agent Actions, 

148 F.3d 283 (3d Cir. 1998).............................................................................................8, 9, 14 

Ritti v. U-Haul Int’l, Inc., 

05-4182, 2006 U.S. Dist. LEXIS 23393 (E.D. Pa. Apr. 26, 2006) ..........................................15 

Senter v. Gen. Motors Corp., 

532 F.2d 511 (6th Cir. 1976) ...................................................................................................15 

Thomas v. NCO Fin. Sys., 

2002 US. Dist. LEXIS 14157 (E.D. Pa. July 31, 2002) .............................................................8 

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iv 

Todd v. Retail Concepts, 

No. 3:07-0788, 2008 WL 3981593 (M.D. Tenn. Aug. 22, 2008) ............................................13 

Wal-Mart Stores, Inc. v. Dukes, 

131 S. Ct. 2541 (2011) .............................................................................................................14 

In re Warfarin Sodium Antitrust Litig., 

391 F.3d 516 (3d Cir. 2004).......................................................................................................8 

Williams v. First Nat’l Bank, 

216 U.S. 582 (1910) ...................................................................................................................9 

In re Wireless Tel. Fed. Cost Recovery Fees Litig., 

No. 4:03-MD-015, 2004 WL 3671053 (W.D. Mo. Apr. 20, 2004) .........................................12 

Zinberg v. Wash. Bancorp, Inc., 

138 F.R.D. 397 (D.N.J. 1990) ..................................................................................................14 

RULES

Fed. R. Civ. P. 23 ................................................................................................................... passim 

Fed. R. Civ. P. 23(a) ..............................................................................................13, 14, 15, 16, 18 

Fed. R. Civ. P. 23(b) ................................................................................................................13, 18 

Fed. R. Civ. P. 23(c) ......................................................................................................................12 

Fed. R. Civ. P. 23(e) ........................................................................................................................7 

Fed. R. Civ. P. 23(h) ......................................................................................................................18 

OTHER AUTHORITIES 

Federal Judicial Center, Manual for Complex Litigation (4th ed. 2009) ............................8, 11, 18 

Alba Conte & Herbert B. Newberg, Newberg on Class Actions § 11.41 (4th ed. 2002) .................7 

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PRELIMINARY STATEMENT 

Plaintiffs Susan Sabol, Valerie Done and Kathleen Klodner (collectively, “Plaintiffs”), 

with the consent of defendants Hydroxatone, LLC and Atlantic Coast Media Group, and their 

subsidiaries and affiliates (collectively, “Hydroxatone” or “Defendants”), respectfully submit 

this memorandum in support of their Joint Motion for Preliminary Approval of Class Settlement 

(the “Motion”). The proposed settlement of this class action provides for the payment of $3 

million into a common fund for the benefit of the Class (the “Cash Fund”), up to an additional $4 

million in non-cash benefits to be offered to the Class (the “Product Benefit”), and significant 

injunctive relief. A copy of the Settlement Agreement entered into by the Parties is attached 

hereto as Exhibit 1. 1 Entry of the proposed Preliminary Approval Order will allow the parties to 

give notice of the settlement to class members and to respond to properly filed objections, if any, 

and then to proceed to a hearing on final approval. As set forth more fully below, the proposed 

Settlement Agreement is fair, reasonable and adequate, and worthy of preliminary approval. 

FACTUAL BACKGROUND 

This putative national class action lawsuit (the “Action”) was commenced against 

Hydroxatone on August 8, 2011 (Docket No. 1, 2:11-cv-04586-SRC-MAS), challenging alleged 

deceptive customer service practices relating to Hydroxatone’s risk free trial offers and autoshipment programs, which include the alleged failure to credit returns of beauty products and the 

alleged failure to cancel membership in auto-ship programs. Declaration of Andrew N. 

Friedman ¶ 3, attached as Exhibit 2 (hereinafter “Friedman Declaration”). On March 23, 2012, 

plaintiffs Susan Sabol and Valerie Done, on behalf of the national class, filed the First Amended 

 1

 Capitalized terms used but not defined herein have the meanings attributed to them in 

the Settlement Agreement. 

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Complaint. (Docket No. 30). In the Amended Complaint, Plaintiffs sought relief on behalf of a 

nationwide class for alleged violations of the New Jersey Consumer Fraud Act, breach of 

contract, unjust enrichment, and for assorted declaratory relief. The First Amended Complaint 

also included alternative claims under the Utah Consumer Sales Practices Act. Friedman Decl. ¶ 

4. 

In response to the First Amended Complaint, Defendants filed a Motion to Dismiss on 

April 30, 2012 (Docket. No. 33). That motion is fully briefed and was awaiting adjudication 

until the case was stayed to allow the parties to pursue settlement negotiations. Friedman Decl. ¶ 

5. 

The parties served interrogatories and requests for production of documents on December 

16, 2011. In response to Plaintiffs’ request for documents, Defendants produced documents on 5 

separate dates, resulting in approximately 62,000 pages received. The documents produced by 

Defendants included a product specialist training manual; scripts for customer service personnel 

dealing with consumers; transcripts for radio and TV advertisements; internal emails; personnel 

files and Defendant’s insurance policy relating to the litigation. Plaintiffs’ counsel reviewed and 

analyzed these documents. Friedman Decl. ¶ 6. Moreover, as noted below, Defendants 

produced additional documents and financial information in anticipation of settlement 

discussions. 

In June 2012, settlement negotiations began between the two parties. As a prerequisite to 

a settlement meeting, Plaintiffs requested – and received --certain discovery regarding 

Defendants’ sales and financial status. On July 17, 2012, Counsel for Defendants and a 

representative of Hydroxatone, conducted settlement discussions with Class Counsel in New 

York. The parties were not in agreement on the terms of any settlement after the July 17th 

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meeting, but determined that additional negotiations with an experienced mediator might be 

fruitful. Friedman Decl. ¶ 7. 

The parties agreed to an August 14, 2012 mediation session before the Honorable 

Stephen M. Orlofsky (ret.). Prior to the mediation session, Defendants provided Class Counsel 

with additional information for settlement purposes in response to Plaintiffs’ specific requests, 

including information related to Defendants’ sales data, customer return/refund data, 

return/refund policies, record-keeping facilities, and insurance coverage. The August 14th 

mediation session resulted in the two parties reaching a tentative settlement agreement. 

Friedman Decl. ¶ 8. Since that time, the Court has been apprised of the agreement in principle 

and multiple orders staying the litigation were entered by the Court in order to allow the Parties 

to draft and execute the terms of the Settlement. A Memorandum of Understanding describing 

the principal terms of the Settlement was executed by the Parties on December 4, 2012.2

 After 

months of working on the explicit terms of the Settlement, settlement papers were executed by 

the Parties on February 7, 2013. Friedman Decl. ¶ 9. 

The parties now submit for review and preliminary approval the full terms of the 

Settlement Agreement of the parties. 

THE PROPOSED SETTLEMENT 

The parties reached agreement on the terms of the proposed settlement through vigorous 

debate of legal and factual theories by counsel and extensive arm’s-length negotiations, 

including a lengthy mediation session in front of Judge Stephen M. Orlosfsky (Ret.). If the 

 2

 On February 7, 2013, Plaintiffs Susan Sabol, Valerie Done and Kathleen Klodner filed a 

Second Amended Class Complaint (Docket No. 64). The Second Amended Complaint added 

Plaintiff Klodner’s claims arising from her participation in Hydroxatone’s Preferred-Customer 

Beauty Program. Friedman Decl. ¶ 10. 

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proposed settlement is approved by the Court, Defendants have agreed to: make meaningful 

changes to the manner in which they market their products; make a payment of $3 million in 

cash into a common fund for the benefit of the proposed settlement class, including the costs of 

settlement administration and attorney’s fees and costs associated with the prosecution of these 

claims and the administration of the settlement; and to provide up to an additional $4 million in 

non-cash benefits to be offered to the settlement class. The proposed settlement class consists of: 

All Persons residing in the United States who between January 1, 

2005 and [insert date of Preliminary Approval Order] received, 

ordered, signed up for, paid for, and/or were charged for 

Hydroxatone-branded products, and/or were charged shipping and 

processing fees for such products, in connection with a Risk-Free 

Trial and/or Auto-Shipment Program. . . . 

The following persons are expressly excluded from the Settlement 

Class: Defendants, any entities in which Defendants has or had a 

controlling interest, any officers or directors of Defendants, the 

legal representatives, heirs, successors, and assigns of Defendants, 

any Judge assigned to this action and his or her immediate family, 

and anyone who timely requests exclusions from the Class. 

As set forth in Section 5 of the Settlement Agreement, cash and non-cash benefits in the 

settlement fund are available for Settlement Class Members from two categories: 

Group 1 – For those Settlement Class Members who attempted to return or cancel 

product shipments and paid more than shipping and processing and/or return postage, such 

claimants will be eligible to receive their choice of either a Cash Benefit or a Product Benefit. 

The Cash Benefit will be $100 for Settlement Class Members who spent more than $200 with 

Defendants after all prior refunds, $75 for Settlement Class Members who spent between $100 

and $200 with Defendants after all prior refunds, and $40 for Settlement Class Members who 

spent less than $100 with Defendants after all prior refunds. The Cash Benefit will be subject to a 

pro rata reduction if the total Approved Claims exceed the Net Settlement Fund. 

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The Product Benefit for Group One members would be their choice of one of six 

Hydroxatone products (each with a retail price of $49.95 or $59.95) if they spent more than $150 

with Defendants after all prior refunds or their choice of one of five Hydroxatone products (each 

with a retail price between $19.95 and $39.95) if they spent $150 or less with Defendants after 

all prior refunds. 

Group 2 – These Settlement Class Members: (1) paid only shipping and processing 

and/or return postage in connection with a risk free trial offer product and/or Preferred-Customer 

Beauty Program Product(s); (2) paid more than shipping and processing and/or return postage in 

connection with a risk free trial offer product and/or Preferred-Customer Beauty Program 

Product(s), but did not try to, attempt to, or take any action designed to return the products; (3) 

cancelled and/or attempted to cancel their auto-ship/Preferred-Customer Beauty Program, but 

paid only shipping and processing or return postage costs; (4) never tried to cancel their autoship/Preferred-Customer Beauty Program; or (5) otherwise fall within the definition of the 

Settlement Class. Group 2 Settlement Class Members will receive a Product Benefit. Each will 

be eligible to receive their choice of one of five Hydroxatone products (each with a retail price 

between $19.95 and $39.95) 

Those Settlement Class Members who choose the Product Benefit (from either Group 1 

or Group 2) will not have to pay any shipping or processing charges to receive the selected 

product. Shipping and processing costs (not to exceed $7.95 per shipment) will be deducted 

from the Cash Fund. Attorneys’ fees and costs, Plaintiff Participation Awards, as awarded by the 

Court, and administrative costs of notice and the settlement will be deducted from the Cash 

Fund. 

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As part of the Settlement, Defendants will also agree not to directly or indirectly engage 

in specific acts or practices that were alleged to be deceptive or unlawful. Specifically, 

Defendants: (i) will not use the word “free” by itself for offers where the customer is required to 

cancel and return the product to avoid being billed for the price of the free product; (ii) will 

disclose the terms of the Preferred-Customer Beauty Program and Beauty Auto-Ship Program in 

a clear and conspicuous manner before getting the customer’s final acceptance of a risk-free trial 

offer; (iii) will provide a simple mechanism on their websites which allows a customer to easily 

effectuate a cancellation of an auto-ship program; and (iv) will provide customers who provide 

an email address and who cancel with email confirmation of such cancellation within 10 days of 

the cancellation becoming effective. 

Defendants have agreed to not oppose an application by Class Counsel seeking the 

reimbursement of their expenses and for fees of not more than 33 1/3 percent of the Cash Fund. 

Class Counsel will also seek the payment of Participation Awards totaling $3,500 to the named 

Plaintiffs in this action for their contribution to the Action. 

To the extent there is any money remaining in the Cash Fund at the close of the Claim 

Period after the pro rata payment of the Cash Benefit, and the fees and expenses noted above, 

the remaining funds will be paid to a cy pres recipient, the Electronic Frontier Foundation. 

Finally, as part of the Settlement, Defendants have produced certain additional financial 

reports to Class Counsel which confirm the statements made during Mediation regarding 

Defendants’ financial status. 

NOTICE TO THE CLASS 

As set forth in Section 10 of the Settlement Agreement, notice will be made by 

Defendants, with the aid of a third-party administrator, by way of: (a) a direct email/postcard 

notice to class members in the Defendants’ database; (b) a press release describing the settlement 

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and directing class members to the dedicated settlement website published via Business Wire or 

PR Newswire; and (c) a dedicated settlement website that will contain the Second Amended 

Complaint, the Preliminary Approval Order, the Settlement Agreement, a long-form notice and 

claim forms available and where class members will be able to file a Claim Form electronically. 

The parties have agreed, and the law supports a finding, that compliance with the notice 

procedures described in the Settlement Agreement is the best notice practicable under the 

circumstances regarding pendency of the Action, certification of the Settlement Class, the terms 

of the Settlement Agreement, and the Final Approval (Final Fairness) Hearing. 

ARGUMENT 

The Settlement Agreement should be approved by this Court. The settlement is the result 

of months of arm’s-length negotiations among the parties and their highly-experienced counsel. 

The settlement provides significant monetary benefits considering all of the attendant risks of 

litigation. Plaintiffs’ counsel have investigated and prosecuted this case for many months and 

strongly believe that the proposed settlement is “fair, reasonable, and adequate” as required by 

Fed. R. Civ. P. 23(e)(1)(C) for the reasons set forth below. The settlement meets this standard, 

taking into account the likelihood of success and the inherent risks, time and expense of 

litigation. 

I. THE STANDARD FOR PRELIMINARY APPROVAL OF CLASS 

SETTLEMENTS 

Federal Rule of Civil Procedure 23(e) requires court approval of a class action settlement. 

Courts generally favor settlements of class actions. “There is usually an initial presumption of 

fairness when a proposed class settlement, which was negotiated at arm’s length by counsel for 

the class, is presented for Court approval.” W. Rubenstein, H. Newberg & A. Conte, Newberg 

on Class Actions § 11.41 (4th ed. 2002). 

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The Third Circuit has a strong judicial policy that encourages class settlements, 

especially those that are the product of arm’s-length negotiations, and courts consider this policy 

when deciding whether to approve a settlement. See In re Prudential Ins. Co. Am. Sales Practice 

Litig. Agent Actions, 148 F.3d 283, 317 (3d Cir. 1998); In re Gen. Motors Corp. Pick-Up Truck 

Fuel Tank Prods. Liab. Litig., 55 F.3d 768, 784 (3d Cir. 1995) (“the law favors settlement, 

particularly in class actions and other complex cases where substantial judicial resources can be 

conserved by avoiding formal litigation”). As such, in making its approval decision pursuant to 

Rule 23(e), the Court should limit its review of what is otherwise a private consensual agreement 

negotiated between the parties only to the extent necessary to make a reasoned judgment that the 

agreement is not the product of fraud, overreaching, or collusion, by or between the negotiating 

parties, and that the settlement itself is fair, reasonable, and adequate. Fed. R. Civ. P. 23(e); In re 

Warfarin Sodium Antitrust Litig., 391 F.3d 516 (3d Cir. 2004). 

While the ultimate approval of a class action settlement depends on whether the 

settlement is “fair, adequate and reasonable,” in evaluating a proposed settlement for preliminary 

approval, “[t]he Court is required to determine only whether the proposed settlement discloses 

grounds to doubt its fairness or other obvious deficiencies such as unduly preferential treatment 

of class representatives or segments of the class, or excessive compensation of attorneys, and 

whether it appears to fall within the range of possible approval.” Mehling v. N. Y. Life Ins. Co., 

246 F.R.D. 467, 472 (E.D. Pa. 2007) (quoting Thomas v. NCO Fin. Sys., 2002 US. Dist. LEXIS 

14157, at *14 (E.D. Pa. July 31, 2002); accord, In re Inter-Op Hip Prosthesis Liab. Litig., 204 

F.R.D. 359, 379 (N.D. Ohio 2001) preliminary approval should be granted if there are no 

grounds to doubt the settlement’s fairness or other deficiencies. Manual for Complex Litig., § 

21.632 (4th ed. 2009)). As one court has aptly stated, “[t]he purpose of the preliminary approval 

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process is to determine whether there is any reason not to notify the class members of the 

proposed settlement and to proceed with a fairness hearing.” Lucas v. Kmart Corp., 234 F.R.D. 

688, 693 (D. Colo. 2006) (citations omitted; emphasis supplied). This approach is consistent 

with the principle that “[c]ompromises of disputed claims are favored by the courts.” Williams v. 

First Nat’l Bank, 216 U.S. 582, 595 (1910); In re Prudential Ins. Co. Am. Sales Practice Litig. 

Agent Actions, 148 F.3d 283, 317 (3d Cir. 1998). 

In making this assessment at the preliminary approval stage, district courts within the 

Third Circuit typically consider factors such as: (i) whether the negotiations occurred at arm’s 

length; (ii) whether there was sufficient discovery; and (iii) whether the proponents of the 

settlement are experienced in similar litigation. See Curiale v. Lenox Grp., Inc., No. 07-1432, 

2008 U.S. Dist. LEXIS 92851, at *26 (E.D. Pa. Nov. 14, 2008) (citations omitted). See also, 

Jones v. Commerce Bancorp, Inc., No. 05-5600 (RBK), 2007 U.S. Dist. LEXIS 52144, at *5 (D. 

N.J. July 16, 2007); Girsh v. Jepson, 521 F.2d 153, 157 (3d Cir. 1975) (considering the 

complexity of case, reaction of class members, stage of proceedings, risks associated with the 

litigation, ability of the defendant to withstand a greater settlement, and whether the settlement 

falls within the range of reasonableness). 

II. THE PROPOSED SETTLEMENT EASILY PASSES THE PRELIMINARY 

FAIRNESS DETERMINATION 

Because there are no “obvious deficiencies” in the Settlement Agreement, nor any 

“grounds to doubt its fairness,” the standards for granting preliminary approval are readily 

satisfied here. Plaintiffs respectfully submit that this Settlement is fair, adequate, and reasonable; 

that the requirements for final approval will be satisfied; and that Class Members will be 

provided with notice in a manner that satisfies the requirements of due process and Fed. R. Civ. 

P. 23(e). Therefore, this Court is respectfully requested to enter the proposed order granting 

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preliminary approval, which will: (i) grant preliminary approval of the proposed Settlement; (ii) 

certify the Settlement Class pursuant to the provisions of Fed. R. Civ. P. 23; (iii) schedule a Final 

Approval Hearing to consider final approval; and (iv) direct that notice of the proposed 

Settlement and hearing be provided to Class Members in a manner consistent with the agreedupon Notice Plan in the Settlement Agreement. 

A. The Proposed Settlement is the Result of an Arm’s-Length Negotiation and 

Therefore Satisfies the Procedural Component for Preliminary Approval 

The proposed settlement is the result of good faith, arms-length negotiations between 

adverse parties to this litigation. In more than 1 1/2 years of litigation since this case was 

commenced in August 2011, all counsel have zealously and independently represented their 

respective parties’ interests, and the proposed Settlement is the result of this zealous advocacy. 

Moreover, the settlement is the product of months of hard-fought negotiations including a 

mediation session before an experienced mediator. 

B. The Discovery In This Case Was Sufficient For the Parties to Determine the 

Basic Facts and the Scope of the Litigation 

The parties have engaged in months of discovery related to class certification and the 

claims of the individual named plaintiffs. As noted above, Defendants have produced thousands 

of pages of documents that relate to the core allegations of the case. In addition, they have 

produced data and other materials as part of the mediation that related to Defendants’ sales 

figures, customer return/refund data, return/refund policies and record-keeping facilities. All of 

this information was reviewed and analyzed by Class Counsel. See Friedman Decl ¶¶ 7- 8. 

Because of the discovery engaged in by the parties, the Plaintiffs’ claims have been challenged, 

developed more fully, and narrowed. Therefore, the parties have “conducted sufficient discovery 

to estimate the merit and value of the Plaintiffs’ case . . . and reach a reasonable settlement.” 

Gates v. Rohm and Haas Co., 248 F.R.D. 434, 444 (E.D. Pa. 2008). 

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C. Counsel Are Highly Experienced in Class Action Litigation 

Plaintiffs’ counsel have diligently investigated potential class claims in this action, have 

substantial experience successfully litigating consumer class actions, are knowledgeable about 

the law relevant to this action, and have committed significant resources to representing the 

class. Friedman Decl. ¶ 11. Similarly, Defendants’ counsel have vigorously defended against 

Plaintiffs’ claims in this action, have substantial experience defending against consumer class 

actions, are knowledgeable of the law relevant to this action, and have committed significant 

resources to representing the Defendants. 

D. The Ability of Defendants to Withstand a Greater Judgment 

While usually not a factor that requires analysis at the preliminary approval stage, the 

issue of “whether the defendants could withstand a judgment for an amount significantly greater 

than the [s]ettlement,” is appropriately raised here. In re Cendant Corp. Litig., 264 F.3d 201, 

240 (3d Cir. 2001). In the present case, it became clear at the mediation that Defendants had a 

limited amount of funds available to settle the claims in the litigation. Despite the existence of 

significant revenues obtained from its sales, Defendants professed that they were experiencing 

losses and that they had little cash to pay a class settlement. These statements were confirmed 

through the production of various financial statements. Indeed, the bulk of the Settlement 

proceeds will be funded via diminishing insurance coverage. 

III. THE PROPOSED NOTICE IS ADEQUATE UNDER RULE 23(c)(2) 

Under Fed. R. Civ. P. 23(e), class members who would be bound by a settlement are 

entitled to reasonable notice of it before the settlement is ultimately approved by the Court. See

Manual for Complex Litig. (4th ed. 2009) § 21.312. And because Plaintiff here seeks 

certification of the Settlement Class under Rule 23(b)(3), “the Court must direct to class 

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members the best notice practicable under the circumstances, including individual notice to all 

members who can be identified through reasonable efforts.” See In re Countrywide Fin. Corp.

Customer Data Sec. Breach Litig., 2009 U.S. Dist. LEXIS 119870, at *42-43 (W.D. Ky. Dec. 22, 

2009) (citing Fed. R. Civ. P. 23(c)(2)(B)). In order to satisfy these standards and “comport with 

the requirements of due process, [the] notice must be ‘reasonably calculated to reach interested 

parties.’” Id. at *43 (quoting Fidel v. Farley, 534 F.3d 508, 514 (6th Cir. 2008)); DeBoer v. 

Mellon Mortg. Co., 64 F.3d 1171, 1176 (8th Cir. 1995) (“Notice of a settlement proposal need 

only be as directed by the district court . . . and reasonable enough to satisfy due process.”). 

“There is no one ‘right way’ to provide notice as contemplated under Rule 23(e).” In re Wireless 

Tel. Fed. Cost Recovery Fees Litig., No. 4:03-MD-015, 2004 WL 3671053, *8 (W.D. Mo. Apr. 

20, 2004). It should be “reasonably calculated, under all the circumstances, to apprise interested 

parties of the pendency of the action and afford them an opportunity to present their objections.” 

Petrovic v. AMOCO Oil Co., 200 F.3d 1140, 1153 (8th Cir. 1999) (quoting Mullane v. Cent. 

Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)). 

The Notice Plan in this case is the best notice practicable under the circumstances to 

reach all Class Members. The Notice itself is clear and straightforward, providing putative class 

members with enough information to evaluate the settlement, as well as procedures to object to 

the settlement. The Notice will be provided to class members by email to those class members 

for whom Hydroxatone has email addresses, by postcard to those class members Hydroxatone 

has mailing addresses, and by publication by way of wire services, together with a dedicated 

website for online information about the settlement. See Ex. 1 ¶¶ 10.1-10-6. This Notice is 

adequate under Rule 23(c)(2). See Farinella v. PayPal, 611 F. Supp. 2d 250 (E.D.N.Y. 2009); In 

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re Grand Theft Auto Video Game Consumer Litig., 251 F.R.D. 139 (S.D.N.Y. 2008); Todd v. 

Retail Concepts, No. 3:07-0788, 2008 WL 3981593 (M.D. Tenn. Aug. 22, 2008). 

IV. THE CASE IS APPROPRIATE FOR CERTIFICATION OF A SETTLEMENT 

CLASS 

Both the Supreme Court and various circuit courts have recognized that the benefits of a 

proposed settlement of a class action can be realized only through the certification of a 

settlement class. See Amchem Prods. v. Windsor, 521 U.S. 591, 620 (1997); Hanlon v. Chrysler 

Corp., 150 F.3d 1011, 1020 (9th Cir. 1998). As such, Plaintiffs seek the conditional certification 

of the Settlement Class set forth above and in the Settlement Agreement. 

“For the Court to certify a class, the plaintiffs must satisfy all of the requirements of Rule 

23(a), and one of the requirements of Rule 23(b).” Dewey v. Volkswagen of Am., 728 F. Supp. 

2d 546, 564 (D.N.J. 2010). Accord Marcus v. BMW of N. Am., LLC, No. 08-5859 (KSH), 2010 

U.S. Dist. LEXIS 122908, at *4 (D.N.J. Nov. 19, 2010). The four requirements Fed. R. Civ. P. 

23(a) are numerosity, commonality, typicality, and adequacy. In addition, Plaintiffs seek 

certification of the Settlement Class pursuant to Rule 23(b)(3), which provides that certification 

is appropriate where “the court finds that the questions of law or fact common to class members 

predominate over any questions affecting only individual members [predominance], and that a 

class action is superior to other available methods for fairly and efficiently adjudicating the 

controversy [superiority].” Fed. R. Civ. P. 23(b)(3). Plaintiffs assert that the Settlement Class 

here meets all of the requirements of Fed. R. Civ. P. 23(a) and 23(b)(3). 

A. Numerosity Under Rule 23(a)(1) 

Rule 23(a)(1) requires that the class be “so numerous that joinder of all members is 

impracticable.” Fed. R. Civ. P. 23(a)(1). “Generally, if the named plaintiff demonstrates the 

potential number of plaintiffs exceeds 40, the numerosity requirement of Rule 23(a) has been 

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met.” In re OSB Antitrust Litig., No. 06-826, 2007 U.S. Dist. LEXIS 56584, at *5 (E.D. Pa. 

Aug. 3, 2007); see also, Zinberg v. Wash. Bancorp, Inc., 138 F.R.D. 397, 405 (D.N.J. 1990) 

(finding that it is proper for the court to accept common sense assumptions in order to support a 

finding of numerosity.). Here, the Settlement Class consists of hundreds of thousands of 

geographically dispersed consumers. Numerosity is therefore easily satisfied here.

B. Commonality Under Rule 23(a)(2). 

Rule 23(a)(2) requires that there be “questions of law or fact common to the class.” Fed. 

R. Civ. P. 23(a)(2). “A finding of commonality does not require that all class members share 

identical claims, and indeed factual differences among the claims of the putative class members 

do not defeat certification.” In re Prudential Ins. Co. Sales Litig., 148 F.3d at 310. The Supreme 

Court recently stated that Rule 23(a)(2)’s commonality requirement is satisfied where the 

plaintiffs assert claims that “depend upon a common contention” that is “of such a nature that it 

is capable of class-wide resolution -- which means that determination of its truth or falsity will 

resolve an issue that is central to the validity of each one of the claims in one stroke.” Wal-Mart 

Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551 (2011). Both the majority and dissenting opinions in 

that case agreed that “for purposes of Rule 23(a)(2) even a single common question will do.” Id. 

at 2556. 

In this case, Plaintiffs are confident that they can establish that there exist several 

common questions of law and fact, including whether Defendants consistently prevented Class 

Members from receiving refunds from the return of “risk-free” products; whether Defendants 

prevented the timely cancellation of auto-ship products; and whether Plaintiffs have actionable 

claims under their causes of action. Commonality is therefore satisfied. 

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C. Typicality Under Rule 23(a)(3) 

Rule 23(a)(3) requires that a representative plaintiff’s claims be “typical” of those of 

other class members. Fed. R. Civ. P. 23(a)(3). ”If the claims of the named plaintiffs and class 

members involve the same conduct by the defendant, typicality is established.” Inmates of the 

Northumberland Cnty. Prison v. Reish, No. 08-cv-345, 2009 U.S. Dist. LEXIS 126479, at *71 

(M.D. Pa. Mar. 17, 2009) (quoting Newton v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 259 

F.3d 154, 183-84 (3d Cir. 2001)). 

Here, all of Plaintiffs’ claims arise out of the same alleged conduct by Defendants related 

to their disclosures regarding risk-free trial offers and auto-shipment programs, their alleged 

refusal to refund Class Members for returned products, their alleged refusal to allow Class 

Members to cancel their auto-ship orders and/or their uniform statements regarding their autoship programs. This requirement is therefore met. 

D. Adequacy of Representation Under Rule 23(a)(4).

The final requirement of Rule 23(a) is that “the representative part[y] will fairly and 

adequately protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). “There are two criteria for 

determining whether the representation of the class will be adequate: 1) The representative must 

have common interests with unnamed members of the class, and 2) it must appear that the 

representatives will vigorously prosecute the interests of the class through qualified counsel.” In 

re Countrywide Fin. Corp. Customer Data Sec. Breach Litig. 2009 U.S. Dist. LEXIS 119870, at 

*19 (quoting Senter v. Gen. Motors Corp., 532 F.2d 511, 524-25 (6th Cir. 1976)). 

In addressing the adequacy of the proposed class representative, district courts examine 

whether he or she “has the ability and incentive to represent the claims of the class vigorously, 

that he or she has obtained adequate counsel, and that there is no conflict between the 

individual’s claims and those asserted on behalf of the class.” Ritti v. U-Haul Int’l, Inc., 05-

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4182, 2006 U.S. Dist. LEXIS 23393, at *15 (E.D. Pa. Apr. 26, 2006). Here, each of the Class 

Representatives are adequate in that they purchased Hydroxatone “free trial” products, were 

unable to receive reimbursement for returned products, and/or were unable to cancel auto-ship 

orders. They have also each actively participated in the litigation, and have been in 

communication with their attorneys regarding the litigation. 

With respect to the adequacy of Class Counsel, they have invested considerable time and 

resources into the prosecution of this action. See Friedman Decl. ¶¶ 7, 8, 11. Class Counsel 

have a wealth of experience in litigating complex class action lawsuits and were able to negotiate 

a meaningful Settlement for the Class in this case. As noted above, Plaintiffs’ counsel have 

extensive experience litigating complex class action cases such as this; the firm resumes of Class 

Counsel are attached to the Friedman Declaration as Exhibits 2-A, 2-B, and 2-C. The adequacy 

requirement is, accordingly, met here. 

E. The Requirements of Rule 23(b)(3) Are Met

Plaintiff seeks to certify the Settlement Class under Rule 23(b)(3), which has two 

components: predominance and superiority. See Fed. R. Civ. P. 23(b)(3). “The Rule 23(b)(3) 

predominance requirement parallels the Rule 23(a)(2) commonality requirement in ‘that both 

require that common questions exist, but subdivision (b)(3) contains the more stringent 

requirement that common issues ‘predominate’ over individual issues.’” In re Countrywide Fin.

Corp. Customer Data Sec. Breach Litig., 2009 U.S. Dist. LEXIS 119870, at *25 (quoting In re 

Am. Med. Sys., Inc., 75 F.3d 1069, 1084 (6th Cir. 1996)). When assessing predominance and 

superiority, the court may consider that the class will be certified for settlement purposes only, 

and that a showing of manageability at trial is not required. See Amchem Products, Inc. v. 

Windsor, 521 U.S. 591, 620 (1997) (“Confronted with a request for settlement-only class 

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certification, a district court need not inquire whether the case, if tried, would present intractable 

management problems, see Fed. Rule Civ. P. 23(b)(3)(D), for the proposal is that there be no 

trial.”). 

“To determine whether common issues predominate over questions affecting only 

individual members, the Court must look at each claim upon which the plaintiffs seek recovery 

... determine whether generalized evidence exists to prove the elements of the plaintiffs' claims 

on a simultaneous, class-wide basis, or whether proof will be overwhelmed by individual issues.” 

Dewey, 728 F. Supp. 2d at 568. With respect to superiority, the Court “considers whether or not 

a class action is a superior method of fairly and efficiently adjudicating the controversy.” Id. at 

569. Rule 23(b)(3) provides a non-exhaustive list of factors to be considered when making this 

determination. These factors include: (i) the class members’ interests in individually controlling 

the prosecution or defense of separate actions; (ii) the extent and nature of any litigation 

concerning the controversy already begun by or against class members; (iii) the desirability or 

undesirability of concentrating the litigation of the claims in the particular forum; and (iv) the 

likely difficulties in managing a class action. Id. (quoting Fed. R. Civ. P. 23(b)(3)). 

Here, there are several common questions of law and fact that predominate over any 

questions that may affect individual Class Members. For example, were this case to proceed, the 

primary issue would be whether Defendants were liable to the Class under the claims pled in the 

Complaint based on the allegations that their advertising was allegedly deceptive and misleading 

and that they allegedly systematically refused Class Members’ requests for refunds and/or 

requests to cancel the auto-ship program. This is an issue that could be subject to “generalized 

proof,” and is a “question that is common to all class members.” See In re Countrywide Fin. 

Corp. Customer Data Sec. Breach Litig., 2009 U.S. Dist. LEXIS 119870, at *26 (“The proof 

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required [must focus] on Defendant’s conduct, not on the conduct of individual class members.”) 

So too is the case here. Accordingly, the predominance prong of Rule 23(b)(3) is satisfied. 

The second prong of Rule 23(b)(3) – that a class action be superior to other available 

methods for the fair and efficient adjudication of the controversy – is also readily satisfied. See

Fed. R. Civ. P. 23(b)(3). The Settlement provides members of the Settlement Class with the 

ability to obtain prompt, predictable, and certain relief. The Settlement also would relieve the 

substantial judicial burdens that would be caused by repeated adjudication of the same issues in 

thousands of individualized trials against Defendants, or by going forward with this case as a 

class action. 

In sum, because the requirements of Rule 23(a) and Rule 23(b)(3) are satisfied, 

certification of the proposed Settlement Class is appropriate. 

F. Final Approval Hearing Should be Scheduled

Finally, the Court should schedule a final fairness hearing to decide whether to grant final 

approval to the Settlement, address Class Counsel’s request for attorneys’ fees, expenses and an 

incentive award for the Class Representatives, and determine whether to dismiss this action with 

prejudice. See Manual for Complex Litig. § 21.633 (4th ed. 2009); Ehrheart v. Verizon Wireless, 

609 F.3d 590, 600 (3d Cir. 2010). The fairness hearing will provide a forum to explain, describe 

or challenge the terms and conditions of the class certification and Settlement, including the 

fairness, adequacy and reasonableness of the Settlement. At that time, Class Counsel will present 

their application for their fees and expenses pursuant to Fed. R. Civ. P. 23(h), and for the 

incentive award to Plaintiffs. 

V. CONCLUSION 

For the foregoing reasons, Plaintiffs respectfully request that this Court enter an Order: 

(1) conditionally certifying a class action with respect to the claims against Defendants pursuant 

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to Fed. R. Civ. P. 23(a) and 23(b)(3) for the purpose of effectuating a class action settlement of 

the claims against the Defendants; (2) preliminarily approving the Settlement; (3) directing 

notice to class members consistent with the terms of the Settlement Agreement; and (4) 

scheduling a Final Approval Hearing. 

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DATED this 7th day of February 2013 Respectfully submitted, 

By /s/ Alan Sash 

Alan Sash 

Lee S. Shalov 

260 Madison Ave. 

New York, NY 

McLAUGHLIN & STERN LLP 

Tel:(646) 278-4298 

Fax: (212) 448-0066 

Andrew N. Friedman 

Whitney R. Case 

COHEN MILSTEIN SELLERS & TOLL PLLC 

1100 New York Avenue, N.W., Suite 500 West 

Washington, DC 20005-3964 

Tel: (202) 408-4600 

Fax: (202 408-4699 

Angela Edwards 

LAW OFFICES OF ANGELA EDWARDS 

72 Canterbury Circle 

East Longmeadow, MA 01028 

(413) 525-3820 

Plaintiffs’ Class Counsel 

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CERTIFICATE OF SERVICE 

 I hereby certify that on this date, a true copy of the attached Memorandum in Support of 

Plaintiffs' Motion for Entry of an Order Granting Preliminary Approval of the Class Settlement 

and Approving the Forms of Notice to the Class and supporting exhibits were served upon 

Defendants’ counsel via ECF. 

 _/s/ Alan Sash____________ 

 Alan E. Sash 

Dated: February 7, 2013 

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