Source: https://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c
Timestamp: 2018-06-21 01:04:31
Document Index: 295739967

Matched Legal Cases: ['§ 1331', '§ 1291', '§ 1331', '§ 1291', '§301', '§ 301']

Appellant's Brief | Synfuel Tech v Airborne | John Pentz - JDSupra
Synfuel Tech v Airborne
Appellant challenged the district court's jurisdiction as well as the notice that was provided to the class.
No. 05-1450 UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT SYNFUEL TECHNOLOGIES, Plaintiff-Appellee, vs. AIRBORNE EXPRESS, Defendant-Appellee, APPEAL OF: JOEL SHAPIRO BRIEF OF APPELLANT JOEL SHAPIRO On Appeal From the United States District Court Southern District of Illinois David R. Herndon, Judge John J. Pentz 2 Clock Tower Place, Suite 260G Maynard, MA 01754 Telephone: 978.461.1548 Facsimile: 707.276.2925 1450 STATES COURT OF APPEALS SEVENTH CIRCUIT TECHNOLOGIES, Plaintif-Appellee, EXPRESS, Appellee, OF: JOEL SHAPIRO OF APPELLANT JOEL SHAPIRO From the United States District Court For the Southern District of Illinois R. Herndon, Judge Tower Place, Suite 260G MA 01754 978.461.1548 707.276.2925 Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47cFED. R. APP. P. 26.1 AND CIR. R. 26.1 DISCLOSURE STATEMENT Joel Shapiro states that he is an individual and not a and therefore is not covered by Fed. R. App. P. 26.1. Appellant states the following attorneys have entered appearances on his in this case: John J. Pentz J. Scott Kessinger 2 Clock Tower Place, Suite 260G 7304 Michigan Avenue MA 01754 MO 63111 Telephone: 978.461.1548 Telephone: 314.369.5115 707.276.2925 314.754.8370 R. APP. P. 26.1 AND CIR. R. 26.1 DISCLOSURE STATEMENT Appellant Joel Shapiro states that he is an individual and not a corporation, and therefore is not covered by Fed. R. App. P. 26.1. Appellant Shapiro states that the following attorneys have entered appearances on his behalf in this case: Tower Place, Suite 260G Avenue Maynard, MA 01754 St. Louis, MO 63111 978.461.1548 314.369.5115 Facsimile: 707.276.2925 Facsimile: 314.754.8370 2 Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c3 TABLE OF CONTENTS FED. R. APP. P. 26.1 AND CIR. R. 26.1 DISCLOSURE STATEMENT……………………..…………2 Table of Contents……………………………………………………...…….3 Table of Authorities………………………………………………..…….….4 Jurisdictional Statement……………………………………………………..5 Statement of the Issues Presented For Review ………………..…….……..6 Statement of the Case………………………………………………………..6 Statement of the Facts……………………………………………………….7 Summary of Argument………………………………………..……………10 Argument……………………………………………………………..……11 I. The District Court Lacked Jurisdiction This Case…………...……………………………...………The Notice Given To The Class Violated Their Due Process Rights……………………...………………...13 Conclusion…………………………………………………………………16 Short Appendix of Decisions Being Appealed…………………………….17 1. Memorandum and Order Approving Settlement 27, 2005……………………….…..…2. Order Denying Objector Shapiro’s Motion Amend Dated February 18, 2005………………..of Service………………………………...…………………….OF CONTENTS R. APP. P. 26.1 AND R. 26.1 DISCLOSURE STATEMENT ... .2 of Contents ... .3 of Authorities ... ..Statement ... ...the Issues Presented For Review ... ...the Case ... ..the Facts ... .7 of Argument ... Argument ... 1. Court Lacked Jurisdiction Over This Case ... 11 II. Given To The Class Violated Due Process Rights ... Conclusion ... of Decisions Being Appealed ... and Order Approving Settlement Dated January 27, 2005 ... .S.A. 1-18 Objector Shapiro's Motion To Amend Dated February 18, 2005 ... ...S.A. 19-22 Certificate of Service ... ..18 Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c4 TABLE OF AUTHORITIES page In re Bankamerica Corp., 227 F. Supp.2d 1103 (E.D. MO 2002)………15 Del Vecchio v. Conseco, Inc., 230 F.3d 974 (7th Cir. 2000)……………11 Teamsters Natl. Auto. Transp. Indus. Neg. Cttee. v. Troha, 328 F.3d 325 (7th Cir. 2003)……………………………………………..11 Turner/Ozanne v. Hyman/Power, 111 F.3d 1312 (7th Cir. 1997)………..12 United Order of Am. Bricklayers and Stone Masons Union No. 21 v. Thorlief Larsen and Son, Inc., 519 F.2d 331 (7th Cir. 1975)……………………………………………..12 OF AUTHORITIES Bankamerica Corp., 227 F. Supp.2d 1103 (E.D. MO 2002)... Vecchio v. Conseco, Inc., 230 F.3d 974 (7th Cir. 2000) ... Auto. Transp. Indus. Neg. Cttee. v. Troha, 328 F.3d 325 (7t' Cir. 2003) ... Ozanne v. Hyman/Power, 111 F. 3d 1312 (7th Cir. 1997) ... Order of Am. Bricklayers and Stone Masons No. 21 v. Thorlief Larsen and Son, Inc., 519 F.2d 331 (7tn Cir. 1975) ... Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c5 Jurisdictional Statement 1. District Court’s Jurisdiction. There is no federal jurisdiction over this case. The Second Amended Complaint alleged that jurisdiction was founded on 28 U.S.C. § 1331, and alleged only one count, for violation of “federal common law.” There is no federal common law that governs contracts between businesses and customers, and therefore no federal jurisdiction exists because this action does not arise under the Constitution, laws or treaties of the United States. 2. Appellate Jurisdiction. If the district court had had jurisdiction, this Court would have jurisdiction pursuant to 28 U.S.C. § 1291. The district court entered a Final Order and Judgment approving a class action settlement on January 27, 2005. On February 18, 2005, the district court entered an order clarifying that despite an amendment to the January 27, 2005 Order, the effective date of finality and appealability was January 27, 2005. Appellant’s Notice of Appeal was filed on February 21, 2005. Statement Court's Jurisdiction. There is no federal jurisdiction case. The Second Amended Complaint alleged that was founded on 28 U.S.C. § 1331, and alleged only for violation of "federal common law." There is no common law that governs contracts between businesses and therefore no federal jurisdiction exists because this does not arise under the Constitution, laws or treaties of the States. Jurisdiction. If the district court had had jurisdiction, would have jurisdiction pursuant to 28 U.S.C. § 1291. court entered a Final Order and Judgment approving a settlement on January 27, 2005. On February 18, 2005, court entered an order clarifying that despite an the January 27, 2005 Order, the effective date of and appealability was January 27, 2005. Appellant's of Appeal was filed on February 21, 2005. Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c6 Statement of Issues Presented for Review the district court improperly entertain this case despite a of federal jurisdiction? the improper designation of the claims filing deadline in sent to class members violate the class members’ Statement of the Case The class action filed in the district court is based upon the default rate Airborne charged its customers who sent a “Letter Express” package without indicating the package’s weight or type. S.A. at 1.1 A customer’s failure to indicate a package’s weight and type resulted in a default rate equivalent to the cost of sending a five pound package. S.A. at 2. Airborne’s smaller “Letter Express” packages hold no more than eight ounces of paper. Id. Plaintiff filed suit against Airborne on behalf of itself and all similarly situated customers in the United States District Court for the Southern District of Illinois on April 11, 2002, complaining that Airborne’s default rate constituted a penalty in violation of federal common law. Docket, Doc. #1 and App. 1-5. The parties reached a settlement which the district court preliminarily approved on October 31, 2003. App. 8-26. The court certified of Issues Presented for Review 1. Did the district court improperly entertain this case despite a lack of federal jurisdiction? 2. Did the improper designation of the claims filing deadline in the notice sent to class members violate the class members' due process rights? of the Case filed in the district court is based upon the default rate charged its customers who sent a "Letter Express" package without the package's weight or type. S.A. at 1.1 customer's failure to a package's weight and type resulted in a default rate equivalent to sending a five pound package. S.A. at 2. Airborne's smaller "Express" packages hold no more than eight ounces of paper. Id. filed suit against Airborne on behalf of itself and all similarly in the United States District Court for the Southern of Illinois on April 11, 2002, complaining that Airborne's default a penalty in violation of federal common law. Docket, Doc. 1-5. The parties reached a settlement which the district court approved on October 31, 2003. App. 8-26. The court certified Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c7 a settlement class of all Airborne customers who were charged a five pound default weight rate charge between April 11, 1992 and November 30, 2003. S.A. at 3. After notice of the settlement was mailed to approximately 250,000 class members, and publication notice was placed in newspapers, App. at 53, the court held a fairness hearing on July 6, 2004. S.A. at 5. On January 27, 2005, the court approved the settlement. S.A. at 1-18. Statement of Facts that was approved by the district court provides that submit valid proofs of claim within 60 days from Final to receive either “Letter Express” packages or cash for past default S.A. at 3-4. Class members may receive up to 4 “Letter Express” packages or $1.50 -$2.50 per default charge, depending upon the of default charges claimed, up to a maximum of $30. As part of the Airborne has also agreed to institute changes in its business including more frequent weighing of packages and additional of what information is required in order to avoid default charges. at 15-16. 1 “A.” will be used in this Brief to refer to the Short Appendix of the decisions on appeal that appears at the end of this Brief. “App.” shall be to the separate Appellant’s Appendix. all Airborne customers who were charged a five pound weight rate charge between April 11, 1992 and November 30, 2003. notice of the settlement was mailed to approximately 250,000 notice was placed in newspapers, App. at 53, held a fairness hearing on July 6, 2004. S.A. at 5. On January 27, approved the settlement. S.A. at 1-18. of Facts The settlement that was approved by the district court provides that class members may submit valid proofs of claim within 60 days from Final Approval to receive either "Letter Express" packages or cash for past default charges paid. S.A. at 3-4. Class members may receive up to 4 "Letter Express" packages or $1.50 -$2.50 per default charge, depending upon the number of default charges claimed, up to a maximum of $30. As part of the settlement, Airborne has also agreed to institute changes in its business practices, including more frequent weighing of packages and additional disclosures of what information is required in order to avoid default charges. App. at 15-16. 1"S.A." will be used in this Brief to refer to the Short Appendix of the on appeal that appears at the end of this Brief. "App." shall be used to refer to the separate Appellant's Appendix. Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c8 As of July 23, 2004, 7,426 class members had filed claims for packages or cash, giving the settlement a value of between $18,565 and $445,560. App. at 48-49 n.2. The deadline for filing claims has not yet arrived, and will arrive no earlier than 90 days after the resolution of this appeal.2 App. at 13-14. Claim forms were mailed to approximately 250,000 class members with the Notice of Proposed Class Action Settlement and Release of Claims. App. at 52-53. Each claim form stated prominently in the upper left hand corner: “Must be Postmarked No Later Than July 23, 2004.” App.at 40. The publication notice did not inform class members of how to claim benefits or the deadline for filing a claim form, but instead directed class members to the settlement website for further information. App. at 6-7. At that website, class members could download the same claim form that was mailed to the 250,000 known class members, which stated prominently in the upper left hand corner: “Must be Postmarked No Later Than July 23, 2004.” App. at 40. Halfway down the form, even more confusion was 2 “Final Approval” is defined in the Settlement Agreement to occur when “approval of this Settlement Agreement and Final Judgment have been affirmed in their entirety, and without material change, by the Court of last which such appeal has been taken and such affirmance has become no longer subject to further appeal or review.” The losing party will have 30 petition for review of this Court’s decision to the United States Supreme Court, and therefore the claim filing deadline will not occur until that date. July 23, 2004, 7,426 class members had filed claims for the settlement a value of between $18,565 and App. at 48-49 n.2. The deadline for filing claims has not yet and will arrive no earlier than 90 days after the resolution of this 2 at 13-14. forms were mailed to approximately 250,000 class members the Notice of Proposed Class Action Settlement and Release of Claims. at 52-53. Each claim form stated prominently in the upper left hand "Must be Postmarked No Later Than July 23, 2004." App.at 40. notice did not inform class members of how to claim or the deadline for filing a claim form, but instead directed class the settlement website for further information. App. at 6-7. At class members could download the same claim form that was to the 250,000 known class members, which stated prominently in left hand corer: "Must be Postmarked No Later Than July 23, 2004." App. at 40. Halfway down the form, even more confusion was 2 "Approval" is defined in the Settlement Agreement to occur when "approval of this Settlement Agreement and Final Judgment have been in their entirety, and without material change, by the Court of last resort to which such appeal has been taken and such affirmance has become subject to further appeal or review." The losing party will have 30 days to petition for review of this Court's decision to the United States and therefore the claim filing deadline will not occur until 60 days after that date. Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c9 created by the language “Your Proof of Claim Must be Received at the address listed above no later than July 23, 2004.” Id. Class members were thus informed by the claim form that it must be postmarked, or received, by July 23, 2004. Elsewhere on the website, this same erroneous information was repeated. On the Frequently Asked Questions page of the website, class members were told that the claim form must be postmarked by September 24, 2004. App. at 41. Of course, by the time of the July 6, 2004 fairness claim forms were due no sooner than October 6, 2004, and then if the court had approved the settlement and entered a Final Order from day. filed a timely objection to the settlement that pointed out information on the claim form and on the website, and asked to order the parties “to amend the claim form posted on the website from now to Final Approval to reflect the new deadline that at each this litigation.” App. at 27-33. The court declined to do this. took almost seven months from the date of the fairness to approve the settlement. By that time, the information on the form and website was nine months out of date, and had likely deterred of class members from filing claims that, according to Airborne, the language "Your Proof of Claim Must be Received at the no later than July 23, 2004." Id. Class members were by the claim form that it must be postmarked, or received, by 23, 2004. on the website, this same erroneous information was On the Frequently Asked Questions page of the website, class told that the claim form must be postmarked by September App. at 41. Of course, by the time of the July 6, 2004 fairness hearing, claim forms were due no sooner than October 6, 2004, and then only if the court had approved the settlement and entered a Final Order from the bench that day. Joel Shapiro filed a timely objection to the settlement that pointed out the erroneous information on the claim form and on the website, and asked the court to order the parties "to amend the claim form posted on the website each month from now to Final Approval to refect the new deadline that applies at each stage of this litigation." App. at 27-33. The court declined to The court took almost seven months from the date of the fairness hearing to approve the settlement. By that time, the information on the claim form and website was nine months out of date, and had likely deterred hundreds of class members from filing claims that, according to Airborne, Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c10 were still being accepted. App. at 52. After the court approved the settlement, Objector Shapiro once again brought the defective notice issue to the court’s attention. App. at 34-45. Soon thereafter, Airborne amended the website to delete any reference to a July 23, 2004 or September 24, 2004 deadlines for filing claims. App. at 53. Objector Shapiro asked the court to order curative notice to the class informing them of the correct claim filing deadline. App. at 36. The court denied this motion. S.A. at 19-22. Summary of Argument fundamental and primary issue in every case is the court’s power to Where that power is lacking, a court must dismiss the case. This at every stage of the case, including appeal, and the issue of may not be waived. Because the district court was without to hear this case, the court’s Order and Final Judgment must be case notice is a requirement of due process that is necessary in to bind absent class members to a court’s judgment in a class action. the benefits that class counsel negotiated on behalf of the class in the settlement is the right to file a claim for a period of up to several Presumably, something of value was traded for this extended claims right. Because class members did not receive adequate notice of their being accepted. App. at 52. After the court approved the Objector Shapiro once again brought the defective notice issue to court's attention. App. at 34-45. Soon thereafter, Airborne amended the to delete any reference to a July 23, 2004 or September 24, 2004 filing claims. App. at 53. Shapiro asked the court to order curative notice to the class them of the correct claim filing deadline. App. at 36. The court motion. S.A. at 19-22. of Argument A fundamental and primary issue in every case is the court's power to adjudicate. Where that power is lacking, a court must dismiss the case. This applies at every stage of the case, including appeal, and the issue of jurisdiction may not be waived. Because the district court was without jurisdiction to hear this case, the court's Order and Final Judgment must be vacated, and the case dismissed. Adequate notice is a requirement of due process that is necessary in order to bind absent class members to a court's judgment in a class action. One of the benefits that class counsel negotiated on behalf of the class in the proposed settlement is the right to file a claim for a period of up to several years. Presumably, something of value was traded for this extended claims filing right. Because class members did not receive adequate notice of their Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c11 rights under the settlement, the court’s Order approving the settlement must be reversed, and the case remanded to the district court for curative notice to the class. Argument I. The District Court Lacked Jurisdiction Over This Case. There was no federal jurisdiction over this case, as there is no such thing as “federal common law” that governs general contract disputes. Moreover, challenges to federal jurisdiction can never be waived. See Del Vecchio v. Conseco, Inc., 230 F.3d 974, 980 (7th Cir. 2000)(“While we are not unsympathetic to the waste of effort represented by a case that has been fully litigated in the wrong court, both the Supreme Court and we ourselves have noted time and again that subject matter jurisdiction is a fundamental limitation on the power of a federal court to act.”). This case involves allegations of breach of contract – namely, that the amount of liquidated damages applied by Airborne for the failure to fill in the weight of a package constitutes a penalty because it exceeds Airborne’s reasonable costs caused by the breach. There is no federal regulation of these charges, and no federal interest that is implicated. Therefore, this case does not present an issue for which the promulgation of federal common law has been authorized. Cf. Teamsters Natl. Auto. Transp. Indus. Neg. Cttee. v. Troha, 328 F.3d 325, 329 (7th Cir. 2003)(holding that the Supreme Court had under the settlement, the court's Order approving the settlement must the district court for curative notice to 1. District Court Lacked Jurisdiction Over This Case. no federal jurisdiction over this case, as there is no such as "federal common law" that governs general contract disputes. challenges to federal jurisdiction can never be waived. See Del v. Conseco, Inc., 230 F.3d 974, 980 (7th Cir. 2000)("While we are to the waste of effort represented by a case that has been litigated in the wrong court, both the Supreme Court and we ourselves and again that subject matter jurisdiction is a fundamental on the power of a federal court to act."). case allegations of breach of contract -namely, that the liquidated damages applied by Airborne for the failure to fill in of a package constitutes a penalty because it exceeds Airborne's breach. There is no federal regulation of interest that is implicated. Therefore, this case for which the promulgation of federal common law Cf. Teamsters Natl. Auto. Transp. Indus. Neg. Cttee. v. 328 F.3d 325, 329 (7th Cir. 2003)(holding that the Supreme Court had 11 Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c12 authorized creation of federal common law to govern enforcement of collective bargaining agreements). The existence of federal question jurisdiction must be determined from the face of the complaint. Turner/Ozanne v. Hyman/Power, 111 F.3d 1312, 1316 (7th Cir. 1997). The only Seventh Circuit case cited in the Complaint to establish jurisdiction is United Order of Am. Bricklayers and Stone Masons Union No. 21 v. Thorlief Larsen and Son, Inc., 519 F.2d 331 (7th Cir. 1975), which was brought under §301 of the Labor Management Relations Act of 1974, not federal common law. Moreover, rather than establishing any special “federal common law” regarding liquidated damages clauses, the Seventh Circuit in United Order relied on the Restatement Second of Contracts, Williston on Contracts and Corbin on Contracts in reaching its decision. Because Plaintiff’s complaint points to no possible basis of federal jurisdiction over a routine breach of contract claim, the district court was without jurisdiction over this controversy, and should have dismissed this case. This Court should remand with an order to dismiss. creation of federal common law to govern enforcement of bargaining agreements). of federal question jurisdiction must be determined the face of the complaint. Turner/Ozanne v. Hyman/Power, 111 F.3d (7th 1997). The only Seventh Circuit case cited in the to establish jurisdiction is United Order of Am. Bricklayers and No. 21 v. Thorlief Larsen and Son, Inc., 519 F.2d 331 was brought under § 301 of the Labor Management Act of 1974, not federal common law. Moreover, rather than any special "federal common law" regarding liquidated in United Order relied on the Contracts, Williston on Contracts and Corbin on in reaching its decision. Plaintiff's complaint points to no possible basis of federal over a routine breach of contract claim, the district court was jurisdiction over this controversy, and should have dismissed this This Court should remand with an order to dismiss. Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c13 II. The Notice Given To The Class Violated Their Due Process Rights. In addition to the right to opt out and the right to object to a class action settlement, class action notice pursuant to Fed. R. Civ. P. 23(e) is intended to apprise class members of their right to claim benefits under the settlement. The notice provided to class members in this case violated both Fed. R. Civ. P. 23(e) and the class’ Constitutional right to due process. Under the settlement approved by the district court, class members have the right to file a claim for cash or pre-paid packages until 90 days after this appeal is concluded, which will probably not occur until 2006. The notice provided to class members, however, instructed them that the claim forms had to be received by July 23, 2004. Clearly, class members were deterred from filing claims by the inaccurate July 23, 2004 deadline that appeared in the claim form and on the website. While Airborne contends that it continued to accept claim forms that were filed after July 23, 2004, as it is required to do under the Settlement Agreement, it failed to provide any evidence to the court that any class members did file claims after the published deadline, or, if so, how many. It is difficult to imagine why a class member would take the time and energy to perform an apparently futile act, such as filing a claim for benefits after the published deadline (that appeared right on the claim form). Notice Given To The Class Their Due Process Rights. to the right to opt out and the right to object to a class settlement, class action notice pursuant to Fed. R. Civ. P. 23(e) is to apprise class members of their right to claim benefits under the The notice provided to class members in this case violated both P. 23(e) and the class' Constitutional right to due process. the settlement approved by the district court, class members to file a claim for cash or pre-paid packages until 90 days after is concluded, which will probably not occur until 2006. The provided to class members, however, instructed them that the claim had to be received by July 23, 2004. Clearly, class members were filing claims by the inaccurate July 23, 2004 deadline that claim form and on the website. While Airborne contends continued to accept claim forms that were filed after July 23, 2004, as required to do under the Settlement Agreement, it failed to provide any the court that any class members did file claims after the deadline, or, if so, how many. is difficult to imagine why a class member would take the time and perform an apparently futile act, such as filing a claim for benefits published deadline (that appeared right on the claim form). Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c14 Certainly, most class members who picked up their claim forms, or visited the settlement website, after July 23, 2004 were deterred from filing a claim by the apparent futility of doing so after the published deadline. Airborne offers two arguments against this certainty. One, class members who downloaded and read the entire Settlement Agreement could have discovered the true claim filing deadline, and, two, class members had seven months in which to file claims, which is sufficient. The first argument ignores human nature, and borders on farcical. Most class members are interested only in claiming their benefits under the settlement, not in becoming experts in the settlement’s details. Therefore, they would not be inclined to read through the entire settlement agreement. Furthermore, given that the claim filing deadline was prominently displayed at the top of the claim form, what would possibly lead a class member to suspect that this printed deadline was in fact erroneous, and send the class member digging into the case file for the correct date? The argument that four months is enough time to file a claim disregards the clearly bargained-for value of a deferred claim deadline. The amount of time for filing claims is a negotiated item. Generally, a longer time period for filing claims favors the class members, a shorter time period favors the defendant. Class counsel here negotiated a claim filing period that may extend for several years. This was one of the settlement’s benefits, most class members who picked up their claim forms, or visited website, after July 23, 2004 were deterred from filing a claim futility of doing so after the published deadline. offers two arguments against this certainty. One, class downloaded and read the entire Settlement Agreement could the true claim filing deadline, and, two, class members had which to file claims, which is sufficient. argument ignores human nature, and borders on farcical. class members are interested only in claiming their benefits under the in becoming experts in the settlement's details. Therefore, not be inclined to read through the entire settlement agreement. given that the claim filing deadline was prominently displayed the claim form, what would possibly lead a class member to printed deadline was in fact erroneous, and send the class into the case file for the correct date? that four months is enough time to file a claim clearly bargained-for value of a deferred claim deadline. The time for filing claims is a negotiated item. Generally, a longer period for filing claims favors the class members, a shorter time period the defendant. Class counsel here negotiated a claim filing period extend for several years. This was one of the settlement's benefits, Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c15 and presumably something of value to the class was traded in order to obtain it. The incorrect deadline printed on the claim form deprived the class of one of the settlement’s benefits negotiated on their behalf. The Defendant may not “recapture” this benefit without giving the class something of value in consideration for it. Curative notice is required to correct the false impression that was created by the first erroneous notice. The notice must be sent to all class members who have not submitted a claim. See In re Bankamerica Corp., 227 F. Supp.2d 1103, 1108 (E.D. MO 2002)(supplemental notice must be sent to all class members whose rights are materially affected). Every class member who did not file a claim has the continuing right to file a claim for at least a $14 mailer. A curative notice would alert class members to the fact that claims may still be filed, and could be expected to prompt the filing of hundreds or perhaps thousands of additional claims. After all, over 240,000 class members who received mailed notice have yet to file their claims. Nothing short of curative notice will accomplish this. something of value to the class was traded in order to obtain The incorrect deadline printed on the claim form deprived the class of the settlement's benefits negotiated on their behalf. The Defendant "recapture" this benefit without giving the class something of value for it. notice is required to correct the false impression that was the first erroneous notice. The notice must be sent to all class have not submitted a claim. See In re Bankamerica Corp., 2d 1103, 1108 (E.D. MO 2002) (supplemental notice must be class members whose rights are materially affected). Every class did not file a claim has the continuing right to file a claim for A curative notice would alert class members to the fact may still be filed, and could be expected to prompt the filing of perhaps thousands of additional claims. After all, over 240,000 received mailed notice have yet to file their claims. short of curative notice will accomplish this. Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c16 CONCLUSION the foregoing reasons, this Court should reverse the district court’s approval of the settlement and remand with an order to dismiss this of federal subject matter jurisdiction. If the Court finds that jurisdiction exists, it should remand to the district court with to order the mailing and publication of curative notice informing the correct deadline for filing a claim. May 10, 2005 _______________________ John J. Pentz, Esq. Class Action Fairness Group Tower Place, Suite 260G Maynard, MA 01754 978) 461-1548 Fax: (707) 276-2925 Clasaxn@earthlink.net For the foregoing reasons, this Court should reverse the district court's approval of the settlement and remand with an order to dismiss this case for lack of federal subject matter jurisdiction. If the Court finds that federal jurisdiction exists, it should remand to the district court with instructions to order the mailing and publication of curative notice informing class members of the correct deadline for filing a claim. Dated: May 10, 2005 Fairness Group 2 Clock Tower Place, Suite 260G MA 01754 Phone: (978) 461-1548 707) 276-2925 earthlink.net Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c17 SHORT APPENDIX Memorandum And Order Approving Settlement (1/27/05)…………..S.A. 1-18 Order Denying Motion to Amend (2/18/05)………………………...S.A. 19-22 APPENDIX And Order Approving Settlement (1/27/05) ... .Motion to Amend (2/18/05) ... .Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c18 Circuit Rule 30(b) Statement As required by Circuit Rule 30(d), undersigned counsel certifies that all materials required under Circuit Rule 30(a) and (b) are in the appendix bound with the brief. ____________________________ John J. Pentz Rule 30(b) Statement by Circuit Rule 30(d), undersigned counsel certifies that all required under Circuit Rule 30(a) and (b) are in the appendix bound the brief. Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c19 CERTIFICATE OF SERVICE John J. Pentz, hereby certify that on May caused two copies of the foregoing brief to be served on the following counsel via first Katz Lennard Korein Tillery LLC Sonnenschein Nath & Rosenthal LLP Woods Court Belleville, IL 62226 233 South Wacker Drive IL 60606 _________________________________ John J. Pentz OF SERVICE I, John J. Pentz, hereby certify that on May 2005 I caused two the foregoing brief to be served on the following counsel via first class mail: Steven A. Katz Jeff Lennard Tillery LLC & Rosenthal LLP 10 Executive Woods Court 8000 Sears Tower IL Wacker Drive Chicago, IL 60606 Document hosted at http://www.jdsupra.com/post/documentViewer.aspx?fid=10793fe4-51f6-407b-bdde-80bf8a3ad47c
Reference Info: Appellate Brief | Federal, 7th Circuit, Illinois | United States