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In re Trs Recovery Services, Inc. and Telecheck Services, Inc., Fair Debt Collection Practices Act Litigation
United States District Court, D. Maine
June 11, 2015
IN RE: TRS RECOVERY SERVICES, INC. AND TELECHECK SERVICES, INC., FAIR DEBT COLLECTION PRACTICES ACT (FDCPA) LITIGATION
D. BROCK HORNBY, District Judge.
On June 9, 2015, I heard argument from the parties about issuing notice in preparation for a fairness hearing on their proposed settlement agreement, revision of the previously certified classes, and plan of distribution. In advance of and during this argument, the parties' counsel provided helpful clarification. I think it is useful to recapitulate what needs to be addressed first in connection with issuing notice and then in preparation for and/or at the fairness hearing.
Once I receive class notice forms from the parties that are improved to my satisfaction, I am prepared to approve them and set the case for a final fairness hearing. See Manual for Complex Litigation (Fourth) § 21.634 (2004). Counsel should consult with the case manager to determine the date of that hearing. I will then issue an Order (which will vary from the Proposed Order, as described during the June 9, 2015 hearing) directing notice to class members on the certification, proposed settlement, and date of the final fairness hearing.
1. Class Notices. Counsel agreed during the June 9, 2015 hearing to revise the class notification forms to make them simpler, clearer, and more consistent with the Federal Judicial Center templates. The plaintiffs' counsel agreed to provide the revised forms to the defendants' counsel by Tuesday, June 16. The defendants' counsel agreed to make revisions by Tuesday, June 23. The parties were directed to file their revised notice forms with the Court by Monday, June 29, 2015.
2. Settlement Amount Distribution. I would like written clarification regarding the plan of distribution in light of some of the contradictions between the settlement agreement and the parties' responses to the May 6, 2015 Procedural Order, and so that class members including any potential objectors will understand how distribution will work. Please confirm whether it is the case that:
a. Members of Class 1 (I will hereafter use the terminology and numbering of classes that the Settlement Agreement uses, not the terminology and numbering of my previous class certification order), who are not members of Subclass 1, are those who received the ReCR3 letter but did not pay a fee. They will receive payment from only the 40% allocation.
b. Members of Subclass 1 are those who both received a ReCR3 letter and paid a fee. They will receive a payment from both the 40% allocation (because they received the letter) and the 60% allocation (because they paid a fee).
c. Members of Class 2, who are not members of Subclass 1 are Maine residents who paid a fee but did not receive a ReCR3 letter. They will receive payment from only the 60% allocation.
d. Members of Class 2, who are also members of Subclass 1 are Maine residents who both received the ReCR3 letter and paid a fee. They will receive payment from both the 40% allocation and the 60% allocation.
e. Roughly two-thirds of Class 1 members are in Subclass 1.
f. Receipt of multiple letters by one class member, or multiple instances of fee payment, do not result in greater recovery for that individual class member.
3. Modifications to the Settlement Agreement. There are particular provisions of the settlement agreement that I will not approve. The parties represented that they will draft a document called a "Modification to the Agreement, " which will be included with the notices when they are distributed to class members.
a. I do not approve the date set in the Settlement Agreement for payment of attorney fees. See Appendix I, § 4.5. I will not approve an agreement that requires disbursement of fees before class members receive payment (compare Appendix I, § 4.14) for three reasons. First, I want final information about the size of the award each class member will receive. Second, I am concerned about the appearance of fairness of the timing of the payments to the class members vis-à-vis the lawyers. Third, I may reduce attorneys' fees by any ...
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