Opinion ID: 177521
Heading Depth: 1
Heading Rank: 4

Heading: The District Court Certifies the Class and Approves the Modified Settlement

Text: The District Court held a final fairness hearing on June 30, 2008, during which it heard at length from class counsel and counsel for the Objectors. The Objectors argued, among other things, that (1) the Court erred when it appointed Judge Ziegler to issue an advisory opinion on the fairness of the Modified Settlement; (2) the Modified Settlement did not extract sufficient consideration for the class members' TILA/HOEPA claims (or the RESPA, RICO, and state law claims the named plaintiffs had pled); and (3) the defendantsin particular RFC and PNC Bank (the successor to CBNV)could withstand a far greater judgment. On August 14, 2008, the Court issued a Memorandum and Order certifying the class and approving the modified settlement. With respect to the adequacy requirement, it relied solely on its 2006 Memorandum, in which it had concluded that the [proposed TILA/HOEPA] claims were time-barred. Thus, Class Counsel's strategic decision to pursue other legal theories in this case in no way renders them inadequate. In any event, ... the proposed settlement accounts for the risk that some members of the class could have established sustainable TILA/HOEPA claims and provides for an award where appropriate. As a result of these determinations, the Court never considered the creation of a subclass. The Court then examined the fairness of the Modified Settlement in light of the factors announced in Girsh v. Jepson, 521 F.2d 153 (3d Cir.1975), and concluded that they counseled in favor of approving the Modified Settlement as fair, reasonable, and adequate. It further concluded that, notwithstanding the named plaintiffs' failure to bring TILA/HOEPA claims, the Modified Settlement was fair, reasonable, and adequate because it provided class members with additional relief for such claims, even though th[e] court found them to be time-barred. The Objectors timely appealed to our Court.