McKinney v. Corsair Gaming, Inc.
4:22-cv-00312
| N.D. Cal. | Mar 25, 2025Background
- Plaintiffs alleged that Corsair Gaming, Inc. marketed and sold memory products (DDR-4 and DDR-5) with advertised speeds that required overclocking and were misleading to consumers.
- Alleged violations included California's Unfair Competition Law, False Advertising Law, Consumer Legal Remedies Act, New York General Business Law, and breach of express warranty.
- Plaintiffs moved for provisional class certification and preliminary approval of a class action settlement that included $5.5 million in monetary relief and changes to Corsair's labeling practices.
- The proposed settlement class had up to 12 million purchases nationwide, though the operative complaint covered only California and New York classes.
- The court had jurisdiction under 28 U.S.C. § 1332(a) and reviewed the motion under Federal Rule of Civil Procedure 23, particularly focusing on the requirements for class certification and settlement approval.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Sufficiency of Settlement Fund | $5.5 million is reasonable based on a 10% price premium on $760M sales | Settlement undervalues claims, especially considering statutory damages | Court found insufficient evidence for 10% premium, questions about damages model |
| Adequacy of Damages Measure | Price premium appropriate, resulting in 8.2% recovery of estimated damages | Damages model is neither proven nor the only appropriate one | Court determined damages theory inadequately supported for classwide measure |
| Scope of Settlement vs. Complaint | Nationwide class promotes efficiency, courts often certify broader classes in settlement | Settlement class not pled or substantiated in complaint | Court held settlement must match complaint or require amendment |
| Attorneys’ Fees/Costs and Statutory Damages | Fees/costs standard, not excessive; did not differentiate from trial recovery | Statutory fees/costs would be in addition to damages at trial | Court noted fees would otherwise not reduce class member recovery, not addressed sufficiently by plaintiffs |
Key Cases Cited
- Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (describes commonality for class certification)
- Hanlon v. Chrysler Corp., 150 F.3d 1011 (standards for preliminary approval of class settlements)
- Amchem Products, Inc. v. Windsor, 521 U.S. 591 (heightened scrutiny for settlement class certification)
- Officers for Justice v. Civil Service Comm’n of City and County of San Francisco, 688 F.2d 615 (standards for reasonableness of proposed class settlements)
- Six (6) Mexican Workers v. Arizona Citrus Growers, 904 F.2d 1301 (benchmark for attorneys’ fees in class actions)
- Staton v. Boeing Co., 327 F.3d 938 (adequacy of representation standard)
- Ellis v. Costco Wholesale Corp., 657 F.3d 970 (adequacy standard and class conflicts)