Ninth Circuit So Rules In Recent Decision.
In Glasser v. Volkswagen of America, Inc., Case No. 09-56618 (9th Cir. May 17, 2011) (for publication), VW settled with plaintiff in a class action after it consented to new disclosures
relating to its smart-key replacement technology (but paid no money to the class), agreeing nevertheless to negotiate fees and costs but not contesting that Plaintiff prevailed and that his attorneys were entitled to something. VW agreed to pay fees and costs awarded by the court, which eventually did award fees of $417,663.73 and costs/expenses of $16,614.40. An objecting class member whose objections were overruled appealed the fee award.
The Ninth Circuit here found that objecting class member lacked standing such that his appeal should be dismissed. Where fees are paid by the defendant rather than out of a common fund, the only basis to allow standing to an objecting class member is on a “constructive common fund” theory–namely, the claim that class counsel breached their fiduciary duty to the class by agreeing to an unfair settlement. Objector was not relying on this theory, but on an attenuated injury theory that was easily rejected by the appeals court.
1949 VW with split-rear window. Source: Wikipedia.
