Hale v. Manna Pro Products, LLC, 2:18-cv-00209

Background

Plaintiff Ashley Hale bought Manna Pro Select Series Pro Formula Premium Rabbit Feed labeled “Contains No Corn” and later discovered multiple bags contained traces of corn; she alleged consumers would not have purchased the product if they knew it contained corn and that the labeling allowed a price premium.
Suit filed in 2018 alleging violations of the California UCL and FAL (fraudulent/unlawful business practices and false advertising) on behalf of a California class who purchased bags labeled “Contains No Corn” from Jan. 30, 2014–May 14, 2019.
After discovery and mediation, parties reached a settlement: defendant to pay $62,500 on a claims-made, pro rata basis; revise labeling; and separately pay attorneys’ fees/costs (up to $125,000), administration costs, and a $7,500 incentive award to Hale; cy pres designated to Public Justice for any unclaimed funds.
Notice: direct mailed to 28 known purchasers; publication and multi-media outreach (website, banner ads, social media, magazine ads, outreach to rabbit-breeder groups); settlement website and toll-free number maintained.
Claims: surge in submitted claims; after verification 471 approved claims; each claimant receives $132.70; no objections or opt-outs.
Court approved final settlement, found notice adequate, approved cy pres recipient, approved $120,000 for attorneys’ fees and costs (after lodestar cross-check and rate adjustments), and approved $7,500 incentive award to plaintiff.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Fairness/Adequacy of settlement under Rule 23(e)	Settlement provides meaningful relief (claims-made fund, label change); parties negotiated at arm’s length; class counsel adequate	Settlement is reasonable resolution of litigation risks and administrative constraints	Approved: settlement is fair, reasonable, adequate; no objections bolster approval
Predominance under Rule 23(b)(3)	Common question (whether labeling “Contains No Corn” was false/deceptive) predominates because members saw similar packaging	(Implicit) Individual issues could vary but common evidence of packaging exposure supports predominance	Predominance satisfied based on common packaging and statutory claims under UCL/FAL
Adequacy of class notice	Publication plus limited direct notice and robust online/social outreach reasonably calculated to reach class where retailer records unavailable	(Implicit) Publication sufficient given inability to obtain purchaser lists	Notice plan satisfied Rule 23 and due process
Cy pres distribution	Public Justice advances consumer-protection objectives and will use funds to combat false labeling, aligning with class interests	(Implicit) Cy pres appropriate given small class and claims-made structure	Cy pres to Public Justice approved as next-best distribution with sufficient nexus to class
Attorneys’ fees (amount & method)	Counsel seeks separate payment up to $125,000 (fees/costs/admin) justified by lodestar and efforts; fees paid separate from class fund	Court must scrutinize reasonableness; benchmark 25% of fund may guide but lodestar cross-check required	Approved $120,000 for fees and costs after reducing hourly rates and conducting lodestar cross-check; requested amount below adjusted lodestar
Incentive award to class representative	Hale contributed substantial time and assisted discovery/settlement; $7,500 reasonable	(Implicit) Court must ensure award is not excessive relative to class recovery	Approved $7,500 incentive award paid separate from class fund

Key Cases Cited

Tyson Foods, Inc. v. Bouaphakeo, 577 U.S. 442 (discusses predominance and common issues in class actions)
In re Online DVD-Rental Antitrust Litig., 779 F.3d 934 (9th Cir.) (lists factors for evaluating fairness of class settlements)
Churchill Vill., L.L.C. v. Gen. Elec., 361 F.3d 566 (9th Cir.) (standard for notice sufficiency in class settlements)
Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir.) (class action predominance and common-nucleus analysis)
In re Bluetooth Headset Prod. Liab. Litig., 654 F.3d 935 (9th Cir.) (standards for attorney-fee awards and district-court review)
Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir.) (lodestar cross-check and multipliers for fee awards)
Dennis v. Kellogg Co., 697 F.3d 858 (9th Cir.) (limits and standards for cy pres distributions)
Lane v. Facebook, Inc., 696 F.3d 811 (9th Cir.) (nexus requirement for cy pres recipients)
Six Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301 (9th Cir.) (cy pres considerations and ‘‘next best distribution’’ principle)
Moreno v. City of Sacramento, 534 F.3d 1106 (9th Cir.) (lodestar methodology for fee awards)
United Steelworkers of Am. v. Phelps Dodge Corp., 896 F.2d 403 (9th Cir.) (consideration of prevailing community hourly rates)