In Re Trans Union Corp. Privacy Litigation
629 F.3d 741
| 7th Cir. | 2011Background
- Consolidated FCRA class actions against Trans Union settled for $110 million in 2008, with $75 million cash and $35 million in-kind relief valued at monitoring services.
- Wheelahan opposed an initial $40 million settlement; ultimately her opposition helped push the final settlement upward to approx. $110 million.
- The district court set a ceiling of $18.75 million on attorneys' fees; the special master recommended $13 million total, with allocations favoring MDL counsel and some to Wheelahan and Texas counsel.
- Dialing through various fee standards, the special master limited fees to 12 percent of the $110 million settlement (about $13 million).
- On appeal, the Seventh Circuit upheld the overall counsel allocation but found Wheelahan's aggregate fee too small and ordered a recalculated award.
- Court concluded Wheelahan is entitled to 22 percent of the total $18.75 million fee award, yielding an additional $1.425 million (beyond the $2.7 million already awarded), for a total of $4.125 million.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Appropriateness of Wheelahan's fee share | Wheelahan seeks 22% of total fees; requests $8.4–$14M; argues higher award is warranted. | MDL counsel and Texas counsel contributed; the special master’s allocation should stand; 13M ceiling was appropriate. | Wheelahan awarded 22% of total fees; remanded to adjust final judgment; additional $1.425M awarded. |
| Allocation among counsel | Wheelahan and Texas counsel deserved substantial credit for increasing the settlement value. | MDL counsel created value; Wheelahan and Texas counsel contributed but not to the extent claimed. | Allocation upheld in principle; MDL counsel receive the majority; Wheelahan and Texas receive portion of the remaining fees. |
| Reasonableness of the 12% fee ceiling | 13M award should be near or above 17% of cash plus in-kind value; ceiling too low. | 12% reflects risk and costs; consistent with comparable cases. | Court notes the 12% ceiling was not fully justified; however, it affirms the overall allocation and remands for corrected judgment, not full recalculation. |
| Impact of in-kind relief on fees | In-kind relief should be valued equivalently to cash; higher percentage for noncash relief warranted. | Noncash relief should receive lower percentage; cash value drives fee framework. | Court recognizes complexity but ultimately fixes Wheelahan's share at 22% of total fees. |
| Remand and final judgment entry | A precise remand would yield a more accurate fee figure. | Remand would be costly and unlikely to yield meaningful precision. | Remand for entry of a corrected judgment is ordered. |
Key Cases Cited
- Thorogood v. Sears, Roebuck & Co., 624 F.3d 842 (7th Cir. 2010) (fee-objecting interloper incentives in settlements)
- Vollmer v. Selden, 350 F.3d 656 (7th Cir. 2003) (interplay of class counsel and settlement structure)
- Reynolds v. Beneficial National Bank, 288 F.3d 277 (7th Cir. 2002) (fee awards in class actions and common fund considerations)
- In re General Motors Corp. Pick-Up Truck Fuel Tank Prod. Liab. Litig., 55 F.3d 768 (3d Cir. 1995) (fee multipliers and allocation among counsel in complex actions)
- Weinberger v. Great Northern Nekoosa Corp., 925 F.2d 518 (1st Cir. 1991) (contingent fee considerations in common fund cases)
- Mirfasihi v. Fleet Mortgage Corp., 356 F.3d 781 (7th Cir. 2006) (fee requests by objecting class counsel; role of interlopers)
- In re Synthroid Marketing Litigation, 264 F.3d 712 (7th Cir. 2001) (risk and contingent fees in class actions)
- Missouri v. Jenkins, 491 U.S. 274 (1989) (contingency and risk evaluation in settlements)
- Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 483 U.S. 711 (1987) (risk and fee adjustments in class actions)
- Laffey v. Northwest Airlines, Inc., 746 F.2d 4 (D.C. Cir. 1984) (risk-based fee adjustments)