Opinion ID: 688777
Heading Depth: 2
Heading Rank: 1

Heading: district court's response to weinstein's settlement objections

Text: 16 Weinstein alleges that the district court failed to respond to his settlement objections with specific findings of fact and conclusions of law as required by Mandujano v. Basic Vegetable Prods., Inc., 541 F.2d 832, 836 (9th Cir.1976) (2-1 decision). In Mandujano we held that Rule 23(e) requires, in addition to notice of the proposed settlement and a hearing on any substantive objections, a reasoned response in the record to settlement objections. Id. at 835-36. The court in Mandujano also stated that [s]uch findings of fact and conclusions of law as may be necessary to support the response must also appear on the record. Id. at 836. 17 In virtually every case since Mandujano, we have refused to remand a settlement even though the district court did not respond to settlement objections with findings of fact and conclusions of law. 3 We hold that in a Rule 23.1 derivative action, a district court that does not respond to objections with findings of fact and conclusions of law must provide a reasoned response elsewhere in the record. Judge Letts has satisfied this procedural requirement. In his order approving the settlement, he stated that the settlement is fair, reasonable and adequate to Pacific Enterprises and its shareholders. This conclusory statement alone would not be satisfactory, but the record reflects that Judge Letts also held an extensive settlement hearing where he responded to Weinstein's objections and explained why the derivative settlement is fair. For example, he stated that the derivative lawsuit would be very difficult to win and that the lawsuits would expose Pacific Enterprises to a substantial risk of bankruptcy. Judge Letts also responded to Weinstein's objections about the attorneys' fee award and ultimately lowered the award from $8 million to $4 million. The entire session is of record, and is a sufficient reasoned response to Weinstein's objections.