Court Opinion

ID: 4163543
Source: CourtListenerOpinion
Date Created: 2017-04-26 20:06:15.910152+00
Date Added: 2024-06-11T14:37:55.639108
License: Public Domain

In the United States Court of Federal Claims
                                       No. 09-241L
                                  (Filed: April 26, 2017)
                                 NOT FOR PUBLICATION

                                             )
 STEVEN JENKINS, et al.,                     )
                                             )
                       Plaintiffs,           )
                                             )       Rails to Trails; Class Action; Final
 v.                                          )       Approval of Settlement Agreement;
                                             )       Partial Final Judgment; RCFC 54(b)
 THE UNITED STATES,                          )
                                             )
                       Defendant.            )
                                             )

             ORDER GRANTING FINAL APPROVAL OF PROPOSED
                     CLASS ACTION SETTLEMENT

       Pending before the court in this rails-to-trails class action is the parties’ request for
final approval of a proposed settlement for 26 of the 27 class members remaining in this
case pursuant to Rule 23(e) of the Rules of the Court of Federal Claims (“RCFC”).

      Based upon a review of the parties’ proposed class action settlement, and for the
reasons below, the parties’ request for final approval of the proposed settlement is
GRANTED.

I.     BACKGROUND AND PROCEDURAL HISTORY

        This case arises from the conversion of a railroad corridor in Dallas County, Iowa
to a recreational trail. In Jenkins v. United States, 104 Fed. Cl. 641 (2009), the court
granted plaintiffs’ motion to certify the class (ECF No. 23, filed Nov. 13, 2009).
Following this court’s determination of liability and a trial on compensation, the Federal
Circuit found that the appraiser should have taken into account the physical remnants of
the railroad when determining the value of each landowner’s property before the taking
occurred. See Rasmuson v. United States, 807 F.3d 1343, 1344 (Fed. Cir. 2015). On
remand, the parties determined that the Federal Circuit’s decision potentially affected 27
class members. On April 26, 2017, the court divided the certified class into two
subclasses for settlement purposes (ECF No. 249). The parties propose to settle this case
for one of two subclasses, which consists of 26 of the 27 remaining class members,
including principal amounts for the value of the land allegedly taken, interest at varying
rates compounded annually since the date of taking, and statutory attorneys’ fees and
costs.
        The parties state that on remand, they reexamined the properties and calculated
adjustments to previously appraised values to reflect the physical condition of the railroad
corridor and conducted settlement discussions to resolve the claims based on those
adjusted figures and other information concerning the properties. See ECF No. 238 at 2-3
(Joint Status Report filed Feb. 21, 2017). The parties state that following the Federal
Circuit’s decision in Rasmuson, 807 F.3d at 1343, the parties generally utilized this
court’s prior findings on land values, based on per acre values in the before condition,
and then considered a variety of adjustments to the original calculations concerning the
cost to reclaim. The government’s appraiser reexamined the parcels and recalculated a
cost to reclaim and plaintiffs’ appraiser reviewed the government’s calculations and
advised class counsel concerning those calculations. The parties note that they still have
differences of opinion concerning whether each parcel would actually be reclaimed, the
extent of the reclamation, and the appropriate methodology to calculate the cost to
actually reclaim it, depending on individual characteristics of each parcel. In addition to
topographical issues, the parties considered property values per acre and point rows or
other severance damages in order to determine whether a settlement could be reached or
whether additional appraisals or a new trial would be required. The ultimate settlement
amounts were negotiated over an extensive period of time.

        The parties’ proposed settlement agreement was filed with the court on February
7, 2017. See ECF No. 236. Under the proposed settlement, the 26 settling class members
in subclass I would receive a total of $1,527,231.55, of which $561,037.13 is principal
for the value of the land at issue, $429,891.71 is accrued interest as of April 1, 2017, and
$536,302.71 is attorneys’ fees and costs of pursuant to the Uniform Relocation
Assistance and Real Property Acquisition Policies Act, 42 U.S.C. §4654(c) (“URA”). 1

1
  The parties state that the proposed settlement agreement contains a misstatement regarding the
amount for attorneys’ fees and costs. See ECF No. 238 at 3-4. The parties provided in the
signed settlement agreement that the amount the United States agrees to pay in attorneys’ fees
and costs “includes the $397,139.92 in attorneys’ fees and $64,587.53 in costs awarded in the
Court’s December 21, 2015 Rule 54(b) Judgment that have not yet been paid.” ECF No. 236 ¶
6. On April 17, 2014, the court entered a judgment that included $1,023,556.50 for attorneys’
fees and $166,462.72 in costs. See ECF No. 191. As noted above, following the Federal
Circuit’s decision in Rasmuson, 807 F.3d at 1343, the parties determined that a number of class
members were not impacted by the Federal Circuit opinion and those class members’ claims
were resolved in a RCFC 54(b) judgment entered on December 21, 2015, which included
statutory attorneys’ fees of $626,416.58 in attorneys’ fees and $101,875.19 for costs. See ECF
No. 205. The parties state that the December 21, 2015 RCFC 54(b) judgment has been satisfied.
See, e.g., ECF No. 238 at 3-4. The parties further state that following the satisfaction of the
December 21, 2015 RCFC 54(b) judgment, there remained $397,139.82 in fees and $64,587.54
in costs from the court’s April 17, 2014 judgment. See id. The parties state that the proposed
settlement in this case includes the outstanding fees and costs from the April 17, 2014 judgment
plus statutory fees and costs accruing from August 6, 2015 (the date of the Federal Circuit’s
opinion) through July 15, 2016 (when the final settlement was reached on a tentative basis for
the 26 class members). See id.
                                               2
        On April 26, 2017, the court granted the government’s motion to divide the
certified class for settlement purposes (ECF No. 247), filed April 21, 2017. The court
certified two subclasses: one subclass consisting of the 26 claimants subject to the
parties’ Joint Motion for Preliminary Approval of Proposed Class Acton Settlement and
Proposed Notice Plan (ECF No. 234), filed February 3, 2017 (“subclass I”); and a second
subclass consisting of the one remaining claimant, the Ronald K. Bender Revocable Trust
(“subclass II”).

II.    DISCUSSION

        Under RCFC 23(e), “[t]he claims, issues, or defenses of a certified class may be
settled, voluntarily dismissed, or compromised only with the court’s approval.” The
court may approve a proposed settlement “only after a hearing and on finding that it is
fair, reasonable, and adequate.” RCFC 23(e)(2); see also Haggart v. Woodley, 809 F.3d
1336, 1348-49 (Fed. Cir. 2016), cert. denied, 136 S. Ct. 2509 (2016). The court has
discretion to accept or reject a proposed settlement, but it may not alter the proposed
settlement, nor may it decide the merits of the case or resolve unsettled legal questions.
Adams v. United States, 107 Fed. Cl. 74, 75-76 (2012) (citing Evans v. Jeff D., 475 U.S.
717, 726-27 (1986); Nat’l Treasury Emps. Union v. United States, 54 Fed. Cl. 791, 797
(2002)).

       There is no definitive list of factors that the court must apply in considering a class
action settlement. Raulerson v. United States, 108 Fed. Cl. 675, 677 (2013). However,
in determining whether a settlement agreement is “fair, reasonable, and adequate,” courts
have found the following factors instructive:

       1. The relative strengths of plaintiff’s case compared to the proposed
          settlement;

       2. The recommendation of the counsel for the class regarding the proposed
          settlement, taking into account the adequacy of class counsel’s
          representation of the class;

       3. The reaction of the class members to the proposed settlement, taking
          into account the adequacy of notice to the class members of the
          settlement terms;

       4. The fairness of the settlement to the entire class;

       5. The fairness of the provision for attorney fees; and

       6. The ability of the defendants to withstand a greater judgment, taking
          into account whether the defendant is a governmental actor or private
          entity.

        E.g., Sabo v. United States, 102 Fed. Cl. 619, 627 (2011) (quotation marks and
citation omitted).
                                              3
       As discussed in the court’s February 22, 2017 order granting preliminary approval
of the proposed settlement agreement (ECF No. 241), the court does not find any
evidence of collusive activity, preferential treatment, or other deficiencies in the proposed
settlement. In this case, in reaching the proposed settlement agreement, the parties
conducted discovery, a thorough joint appraisal of the fair market value of class
members’ property interests for the alleged taking, and negotiations indicating no
preferential treatment or other deficiencies. See ECF No. 238 at 2-3.

       Class counsel represents that all 26 plaintiffs in subclass I have affirmatively
consented to the settlement, there are no objections or comments of any kind, and no
class members requested to participate in or speak at the fairness hearing. At the April
14, 2017 fairness hearing, no class members participated or spoke.

        In addition, consistent with the Federal Circuit’s decision in Haggart, 809 F.3d at
1359, the proposed agreement does not provide for plaintiffs’ attorneys’ fees to be paid
out of the settlement proceeds under the “common fund” doctrine. See also Sabo, 102
Fed. Cl. at 630; Barnes v. United States, No. 04-1335C, 2010 WL 1904503, at *2 (Fed.
Cl. May 7, 2010).

        In view of the foregoing, the court finds that the parties’ settlement agreement is
fair, reasonable, and adequate and warrants approval.

III.   CONCLUSION

       For the reasons above, the parties’ proposed settlement agreement for the
subclass I plaintiffs is APPROVED. Pursuant to RCFC 54(b), because there is no just
reason for delay, the clerk is directed to enter judgment for the subclass I plaintiffs in the
amounts of $561,037.13 in principal and $429,891.71 in interest through April 1, 2017
apportioned among the subclass I plaintiffs as shown in the table accompanying the
attached approved settlement agreement. Interest shall be payable on these amounts at a
daily rate of $90.77, beginning on April 2, 2017, until the date the judgment is paid. In
addition, the clerk is directed to enter judgment for the subclass I plaintiffs in the amount
of $74,574.35 for attorneys’ fees and costs pursuant to the URA. 2

       IT IS SO ORDERED.

                                                            s/Nancy B. Firestone
                                                            NANCY B. FIRESTONE
                                                            Senior Judge

2
 This amount is equal to $536,301.71 as agreed to in the approved settlement agreement minus
$397,139.82 in fees and $64,587.54 in costs awarded in the court’s April 17, 2014 judgment
which have not yet been paid. See ECF No. 238 at 3-4.
                                              4