Brady v. Caption Call LLC

• Court: District Court, D. Nevada
• Decided: January 31, 2025
• Docket: 2:22-cv-00164
• Status: Unknown

Opinion

2 UNITED STATES DISTRICT COURT 3 DISTRICT OF NEVADA 4 5 BRENDA BRADY, on behalf of herself 6 and all others similarly situated, Case No. 2:22-cv-00164-ART-NJK

7 Plaintiff, ORDER vs. 8 CAPTIONCALL LLC; DOES 1 through 9 50; inclusive,

10 Defendant.

11 12 At the Final Fairness Hearing held on January 30, 2025, the Court 13 expressed concerns about the reversionary aspect of the parties’ proposed class 14 action settlement, considering the Ninth Circuit’s concerns with reversionary 15 clauses in class action settlements. See Roes, 1-2 v. SFBSC Mgt., LLC, 944 F.3d 16 1035, 1058 (9th Cir. 2019) (while not disallowed outright, reversionary clauses 17 are generally disfavored because they create perverse incentives); see also In re 18 Volkswagen "Clean Diesel" Mktg., Sales Practices, and Products Liab. Litig., 895 19 F.3d 597, 612 (9th Cir. 2018) (while a reversion clause can be benign, a district 20 court approving of a class settlement containing such a clause “must explain why 21 the reversionary component of a settlement negotiated before certification is 22 consistent with proper dealing”). Here, the parties’ motion for final approval of 23 the class settlement did not explain why a reversion is appropriate. 24 The reversion of the unclaimed net settlement fund to Defendant is 25 particularly concerning to the Court given the short (30 day) claim period and 26 large (60%) portion of the net settlement fund which would be reverted to 27 Defendant. See Millan v. Cascade Water Servs., Inc., 310 F.R.D. 593, 601, 612 28 1 || (E.D. Cal. 2015) (rejecting wage-and-hour settlement with proposed 30% 2 || reversion to defendant and collecting similar cases); Roes, 944 F.3d at 1047-48 3 || (reversing approval partially because notice did not adequately account for 4 || reversionary aspect of settlement funds). 5 At the hearing, Plaintiffs counsel proposed addressing the Court’s 6 || concerns by providing another opportunity for class members to submit claims. 7 || The parties are ordered to file a status report within 14 days of this order to 8 || inform the Court of their plans to address the Court’s concern. 9 10 Dated this 31st day of January, 2025 11 12 Ana jlosed dn 13 ANNE R. TRAUM 14 UNITED STATES DISTRICT JUDGE 15 16 17 18 19 20 21 22 23 24 25 26 27 28