Court Opinion

ID: 9635313
Source: CourtListenerOpinion
Date Created: 2023-08-22 13:46:35.225515+00
Date Added: 2024-06-11T09:54:35.224813
License: Public Domain

DISSENTING OPINION BY
President Judge COLINS.
I agree with the majority that our standard of review of a trial court’s acceptance or rejection of a class action settlement proposal is abuse of discretion, but I believe that the majority has substituted its discretion for that of the trial court and therefore I dissent.
Abuse of discretion has been defined as not merely an error of judgment, but rather it is an overriding of, or misapplication of the law, or the exercise of judgment in a way that is manifestly unreasonable or the result of partiality, prejudice, bias, ill-will. Man O'War Racing Association v. State Horse Racing Commission, 433 Pa. 432, 250 A.2d 172 (1969). In discharging its responsibility to ensure that the proposed settlement is fair and reasonable and beneficia 1 to the partnership (and derivatively to the various retirement plans and trust funds that are included among its limited partners), the trial court applied the correct legal standard and found itself unable to accord due consideration to the most important factors, and ultimately the adequacy of the proposed settlement, without more information. Although the parties claim to have engaged in extensive discovery in the course of mediation, the information gathered from questioning the mediator and from the single deposition produced to the court added little to the court’s understanding. The parties to a class action settlement have the obligation to support their conclusion to the satisfaction of the court.1 The trial court’s concern with seeking to maximize the benefit to the limited partners and its desire to shed more light on the likely outcome of the case and potential damages through court-supervised -discovery do not constitute an abuse of discretion. On the contrary, in my opinion, such concerns constitute the sound exercise of discretion. This Court should not substitute its judgment for that of the trial judge; a difference of opinion does not equate to an abuse of discretion.
In the face of allegations that in its representation of Keystone, Ballard Spahr was aware of misappropriation of Keystone partnership funds by its then-acting managing director, assisted in a settlement of claims for wrongful diversion of funds that was allegedly not in Keystone’s favor, and failed to properly advise or inform the limited partners of the misappropriation, the settlement, and violations of the partnership agreement, Ballard Spahr filed an unopposed motion for approval of the proposed settlement that was the product of private mediation. Ballard Spahr admits no wrong doing, but agrees to pay $4.5 million to settle Keystone’s claims. By rejecting the proposed settlement and calling for court-sanctioned discovery, the trial court refused to abdicate its responsibility to ensure that the settlement was fair and reasonable and beneficial to the partnership and its limited partners.
Judge COHN JUBELIRER joins.

. See Weinberger v. Kendrick, 698 F.2d 61 (2d Circ.1982), cert. denied, 464 U.S. 818, 104 S.Ct. 77, 78 L.Ed.2d 89 (1983).