U.S. District Judge William Alsup might have a future in the plaintiff’s bar.
Six weeks ago, he rejected a $9 million wage-and-hour settlement for former Oracle Corp. sales employees on grounds that the deal was too generous for Oracle and the lawyers in the case. Calling it a “bonanza” settlement, Alsup said the deal short-changed class members while designating as much as $2.25 million for attorneys’ fees.
Since then, Alsup has had the lawyers revise their agreement, return to court and rewrite the deal again. On Aug. 2, at last, he ruled that the settlement was “sufficiently fair and reasonable” to get preliminary approval.
Still, Alsup cautioned the lawyers that he will give the settlement one last look at the end of the year — and he might reject it again, despite the hoops attorneys jumped through to make him happy.
Schneider & Wallace’s Todd Schneider and Santa Barbara solo Christina Djernaes are plaintiff attorneys in the case. Nancy Abell, a partner at Paul, Hastings, Janofsky & Walker, is representing Oracle.
To appease Alsup, they agreed to limit attorneys’ fees based on how much of the settlement Oracle pays to former employees.
They also agreed to cut down the number of claims that will be released by the settlement, and to include class members from outside California in the settlement only if they submit a claim. The original deal affected all class members except those who actively chose to withdraw.
As for Alsup’s concern that class members were to get only “dimes on the dollar” for claims once valued over $52 million, he said one of the plaintiff lawyers explained his reasons for accepting “the low settlement” well enough to merit preliminary approval.
By giving the deal a preliminary nod, Alsup let the lawyers notify class members of their agreement.
In that notice, though, he encouraged the lawyers to choose their words carefully:
“In no way should the notice suggest that the court has given approval to the settlement; instead the notice should state that the court invites class members to comment on the adequacy of the settlement, and it should state that the settlement represents about 15 percent of the maximum that might be recovered if the case went to trial.”
Boy, oh boy! Aren’t class members going to be thrilled when they see that!
— Matthew Hirsch
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