Opinion ID: 705994
Heading Depth: 2
Heading Rank: 1

Heading: The Attempt To Discharge Class Counsel

Text: 24 Inherent in any class action is the potential for conflicting interests among the class representatives, class counsel, and absent class members. The interest of lawyer and class may diverge, as may the interests of different members of the class.... Plummer v. Chemical Bank, 668 F.2d 654, 658 (2d Cir.1982) (internal quotation marks omitted). Both class representatives and class counsel have responsibilities to absent members of the class. Under Rule 23, the court cannot properly certify the action to proceed as a class action unless it is satisfied that the representative plaintiffs will fairly and adequately protect the interests of the class. Fed.R.Civ.P. 23(a)(4). Thus, class certification may properly be denied where the class representatives ha[ve] so little knowledge of and involvement in the class action that they would be unable or unwilling to protect the interests of the class against the possibly competing interests of the attorneys. Kirkpatrick v. J.C. Bradford & Co., 827 F.2d 718, 727 (11th Cir.1987), cert. denied, 485 U.S. 959, 108 S.Ct. 1220, 1221, 99 L.Ed.2d 421 (1988). Once the action has been certified to proceed as a class action, it is incumbent on the class representatives to be alert for, and to report to the court, any conflict of interest on the part of class counsel, as for example, counsel's greater concern for receiving a fee than for pursuing the class claims. See generally 7A C. Wright, A. Miller, & Mary Kay Kane, Federal Practice and Procedure Sec. 1769.1, at 386-87 (1986) (Wright Miller & Kane). 25 The fact that the named plaintiffs in a certified class action have been found to be adequate representatives of the class does not, however, mean that they have the right to replace class counsel at will. The identity of class counsel will have been one of the components of the district court's precertification consideration under Fed.R.Civ.P. 23(a)(4) as to whether the named plaintiffs are adequate representatives of the class. See, e.g., Eisen v. Carlisle & Jacquelin, 391 F.2d 555, 562 (2d Cir.1968) (attorney must be qualified, experienced and generally able to conduct the proposed litigation); see generally Wright Miller & Kane Sec. 1769.1, at 375. The attorneys themselves have an obligation to all of the class members, and when a potential conflict arises between the named plaintiffs and the rest of the class, the class attorney must not allow decisions on behalf of the class to rest exclusively with the named plaintiffs. Pettway v. American Cast Iron Pipe Co., 576 F.2d 1157, 1176 (5th Cir.1978), cert. denied, 439 U.S. 1115, 99 S.Ct. 1020, 59 L.Ed.2d 74 (1979); cf. Saylor v. Lindsley, 456 F.2d 896, 899-900 (2d Cir.1972) (assent of the plaintiff (or plaintiffs) who brought a derivative stockholder's action is not essential to a settlement; a contrary view would put too much power in a wishful thinker or a spite monger to thwart a result that is in the best interests of the corporation and its stockholders). 26 The ultimate responsibility to ensure that the interests of class members are not subordinated to the interests of either the class representatives or class counsel rests with the district court. See, e.g., In re Agent Orange Product Liability Litigation, 996 F.2d 1425, 1438 (2d Cir.1993) (A judge in a class action is obligated to protect the interests of absent class members.), cert. denied, --- U.S. ----, 114 S.Ct. 1125, 127 L.Ed.2d 434 (1994); Grant v. Bethlehem Steel Corp., 823 F.2d 20, 22 (2d Cir.1987) (In approving a proposed class action settlement, the district court has a fiduciary responsibility to ensure that 'the settlement is fair and not a product of collusion, and that the class members' interests were represented adequately.' ); Walsh v. Great Atlantic & Pacific Tea Co., 726 F.2d 956, 964 (3d Cir.1983) (The court [i]s required to ... consider whether class counsel provided fair and adequate representation to the class as a whole.). Thus, where there is a dispute between class counsel and the class representatives as to the course to be followed, the decision cannot rest entirely with either the named plaintiffs or with class counsel. Pettway v. American Cast Iron Pipe Co., 576 F.2d at 1177. The choice between the views of counsel and those of the representatives must rest with the district court. See, e.g., id. at 1178 ([w]here the named plaintiffs wish to appeal, but the class attorney concludes that an appeal is not in the best interest of the class, the district court must exercise its discretion in deciding whether to substitute class counsel to allow the named plaintiffs to maintain the appeal on behalf of the class). Given the familiarity of the district court with the proceedings, the parties, and the performance of counsel, we will review that court's decision only for abuse of discretion. 27 We see no abuse of discretion here. The district court found that appellants had not alleged or proven that class counsel had engaged in any improper conduct or had in any way undermined the rights of the class at large. Appellants have pointed to nothing in the record that contradicts this observation. They sought to allege that counsel had a conflict of interest by contending that the amounts to be received by individual class members were small in comparison to the amount to be requested in legal fees. Such a disparity occurs without any conflict of interest in many class actions, and the supervision of settlement negotiations by a magistrate judge, as occurred here, makes it less likely that the disparity represents class counsel's promotion of their own interests over those of the class. The district court, in stating that there was no indication that class counsel had failed to carry out their responsibilities to the class nor any evidence of impropriety, implicitly found that appellants' presentation was insufficient to show a conflict of interest. The record supports the district court's characterization of appellants' attempt to discharge class counsel as a hasty move on the eve of the Settlement Hearing, and we see no basis for overruling its conclusion that granting appellants' application at the eleventh hour would be a disservice to the class at large. Accordingly, we uphold the order denying appellants' motion to discharge counsel substantially for the reasons stated in Judge Sweet's June 22, 1994 opinion reported at 155 F.R.D. 494.