Hashw v. Department Stores National Bank, 182 F. Supp. 3d 935

Background

Plaintiff Ameer Hashw sued DSNB and FDS under the TCPA, alleging automated calls to his cell phone without consent in connection with Macy’s/Bloomingdale’s credit-card accounts; he alleged 112 calls to his phone and amended to bring a nationwide class.
After discovery and two-day mediation, parties agreed to a class settlement: $12.5 million fund; after ~$1.7 million admin costs and fees, about $8.3 million remained for claimants; estimated class ~1.2 million; ~252,078 claims submitted; 30 opt-outs; 5 objections.
Settlement releases claims related to use of an artificial/prerecorded voice or ATDS for debt-collection calls during Sept 3, 2009–July 22, 2015; distributes funds pro rata to timely claimants, with redistribution if economically feasible and cy pres if remaining amounts would be ≤ $3 per claimant.
Court preliminarily approved settlement, ordered broad direct and publication notice (email/mail, website, People and USA Today ads), and held a fairness hearing; final approval and fee/service award requests followed.
The court found the settlement fair, reasonable, and adequate considering litigation risks (proof of consent, incomplete defendant records, class-certification hurdles), recovery per claimant (~$33.20), large claims rate, and limited objections; it approved cy pres recipients (Privacy Rights Clearinghouse and Consumer Federation of America).
The court reduced plaintiffs’ counsel fees from the requested 33% (~$4.166M) to 20% ($2.5M) and cut the named-plaintiff incentive award from $27,500 to $15,000, ordering those amounts paid from the settlement fund.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Final approval of class settlement	Settlement provides meaningful, immediate recovery to class (~$33 each to claimants) and was negotiated after discovery and mediation	Settlement is reasonable; defendants joined final approval	Approved as fair, reasonable, adequate; class certified for settlement purposes
Adequacy of notice	Notice program (direct mail/email, website, ads) reached millions and produced high claims rate	Notice satisfied Rule 23 requirements and due process	Notice was the best practicable and constitutionally adequate
Objections re: scope and procedures (credit reporting, claim form, cy pres)	Objectors sought credit-report remediation, less burdensome claim form, and no/identified cy pres recipients	Plaintiffs argued settlement limited to autodialer/voice claims; claim form and affirmation prevented fraud; cy pres limited and recipients later disclosed	Objections overruled; settlement scope appropriate; claim form reasonable; cy pres acceptable given de minimis potential remainder
Attorneys’ fees and incentive award	Counsel requested 1/3 of fund (~$4.166M) and $27,500 incentive to named plaintiff	Defendants did not oppose fee/incentive up to specified amounts in agreement	Court awarded 20% of fund ($2.5M) after lodestar cross-check (lodestar ≈ $420k) and reduced incentive to $15,000 as more proportional

Key Cases Cited

Little Rock School Dist. v. Pulaski County Special School Dist. No. 1, 921 F.2d 1371 (8th Cir. 1990) (settlement agreements are presumptively valid)
In re General Motors Corp. Pick-Up Truck Fuel Tank Products Liability Litigation, 55 F.3d 768 (3d Cir. 1995) (court must ensure settlement provides adequate compensation for release of class claims)
In re Wireless Telephone Federal Cost Recovery Fees Litigation, 396 F.3d 922 (8th Cir. 2005) (factors for evaluating class-action settlements)
Petrovic v. Amoco Oil Co., 200 F.3d 1140 (3d Cir. 1999) (balancing strength of plaintiffs’ case against settlement amount)
Perdue v. Kenny A., 559 U.S. 542 (2010) (lodestar is a presumptively reasonable fee; lodestar considerations for fee awards)
In re BankAmerica Corp. Securities Litigation, 775 F.3d 1060 (8th Cir. 2015) (cy pres notice principles and scrutiny of cy pres distributions)