Parker v. Anderson

667 F.2d 1204, 28 Fair Empl. Prac. Cas. (BNA) 788, 33 Fed. R. Serv. 2d 963, 1982 U.S. App. LEXIS 21681, 28 Empl. Prac. Dec. (CCH) 32,441
CourtCourt of Appeals for the Fifth Circuit
DecidedFebruary 18, 1982
DocketNo. 81-1210
StatusPublished
Cited by130 cases

This text of 667 F.2d 1204 (Parker v. Anderson) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Parker v. Anderson, 667 F.2d 1204, 28 Fair Empl. Prac. Cas. (BNA) 788, 33 Fed. R. Serv. 2d 963, 1982 U.S. App. LEXIS 21681, 28 Empl. Prac. Dec. (CCH) 32,441 (5th Cir. 1982).

Opinion

POLITZ, Circuit Judge:

We review the district court’s approval of a settlement of a class action suit against Bell Helicopter Company and its award of attorneys’ fees. The court’s approval was granted over the objection of all but one of the eleven named plaintiffs as well as over the objections of a number of class plaintiffs. Improprieties are claimed to have occurred in the settlement negotiations and the agreement is challenged as inadequate in its terms. In addition, one of the attorneys for the class appeals the amount of attorney’s fees awarded to his firm. Finding neither error nor abuse of discretion in the court’s approval of the settlement and setting of attorneys’ fees and costs, we affirm.

Facts

In March 1975, Sarah Parker and Curtis Ford filed a class action suit against Bell Helicopter Company, a division of Textron, Inc., and certain unions, alleging discrimination in employment against blacks and females, in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e —2000e-17. Between 1975 and 1979 six other lawsuits brought by nine plaintiffs alleged identical discrimination by Bell; two of these suits included unions as defendants.1 The seven suits were consolidated into the instant proceeding.

Following consolidation, because the attorneys were unable to agree to an apportionment of responsibilities, the district court designated Howard Specter as lead counsel and Huey Mitchell and James Barber as associate class counsel, and assigned them concomitant duties. On April 21, 1978, the district court conditionally certified the litigation as a class action under Rule 23(b)(2) of the Federal Rules of Civil Procedure. Extensive, reciprocal discovery on the merits began in October 1978 and continued until February 1980.

Trial was scheduled for March 3, 1980. At the pretrial conference on February 6, 1980, it appeared that a settlement might be possible; the court urged counsel to make a good faith effort to reach an agreement. On February 29, 1980, counsel reached a tentative agreement and moved jointly for a continuance.2 The motion was granted and the court instructed counsel to inform the court on or before April 1, 1980, whether a complete settlement could be achieved.

During March 1980, class counsel met with the various named plaintiffs and discussed the tentative settlement proposal. Each of the eleven named plaintiffs authorized their counsel to note their approval of the class settlement, subject to Bell’s acceptance of their individual demands which included a demand of $100,000 for one plaintiff, $84,000 for another, and guarantees of promotion to specific jobs for others. Bell countered with an offer of $1,500 each for ten of the named plaintiffs and $2,500 plus a future promotion for the eleventh.

On March 26,1980, associate class counsel Barber met with all named plaintiffs to discuss the suit and proposed settlement. A discussion of the evidence, particularly the statistics plaintiffs were relying on, was planned. No serious discussion of the lawsuit was possible; plaintiffs were interested primarily in discussing their personal monetary demands. Apparently convinced that Bell’s offer to them was too little, nine of [1208]*1208the eleven plaintiffs expressed opposition to the settlement.3

On March 29, 1980, the attorneys for the parties approved a proposed Stipulation of Compromise and Agreement which embodied 18 of the 19 points contained in the tentative agreement confected on February 29, 1980. The proposal required Bell to deposit $1,250,000 in an interest bearing account to be distributed to the class members when and as directed by the court.4 Certain affirmative relief measures projected to cost Bell approximately $1,000,000 to implement and maintain, were included. The proposal was made applicable only to the members of the class; Bell agreed to sever the individual claims of the named plaintiffs. Those claims are still pending.

On April 8, 1980, lead counsel Specter met with the named plaintiffs, intending to discuss the proposed settlement and his analysis of the strengths and weaknesses of the evidentiary base of their suit. The effort was futile; the plaintiffs focused on and voiced disagreement with Bell’s counter to their individual claims. Specter offered to meet separately with each plaintiff. No one accepted his invitation.

On April 10, 1980, several plaintiffs moved to enroll Charles Padorr as their attorney for purposes of objecting to the settlement. By June 21,1980, all plaintiffs had dismissed their original attorneys except the non-objecting Judith Anderson, who continued to be represented by Mitchell. On April 18, 1980, the proposed settlement was filed along with a motion for preliminary approval.

On May 29, 1980, the district court defined a subclass of “objectors” and appointed Padorr as their counsel with authority to conduct discovery into the propriety of the settlement negotiations and the fairness of the settlement. On July 25, 1980, the court preliminarily approved the settlement for purposes of notification of the class. After considering filings from all parties, including the objectors, the court approved forms of notice for dissemination to the class, direct and by publication. This notice advised that a hearing would be conducted to examine the fairness and adequacy of the settlement.

After being continued once, the hearing on the proposed settlement commenced on October 16, 1980. For two days the court received evidence from the proponents and opponents of the proposed settlement. The hearing extended into a third day, when the court received evidence on the issue of fees for the class attorneys.

On March 11, 1981, the court filed a comprehensive Memorandum Opinion and Order which found the settlement to be fair and reasonable. The court also assessed fees for the various class attorneys and allowed their recovery of costs incurred in preparing the matter for trial. On April 10, 1981, the court amended the earlier order to correct clerical errors, to effect one substantive change, and to provide for post-settlement attorney’s fees and apportionment of interest accruing on the deposit. This appeal followed.

Objectors maintain that the settlement should be rejected because (1) the terms are not fair and reasonable, (2) the class attorneys did not properly represent the class in negotiations, and (3) the payment of attorneys’ fees out of the class settlement fund creates an impermissible conflict of interest. Mitchell appeals his award of attorney’s fees.

I. Fairness and Adequacy of the Settlement

Rule 23(e) requires court approval of compromise settlements of class actions, but it is silent as to the standard to be applied. Nonetheless, the rubric is now [1209]*1209well established that the court will not approve a settlement unless it is found to be fair, adequate, and reasonable. In re Corrugated Container Antitrust Litigation, 643 F.2d 195 (5th Cir. 1981); Cotton v. Hinton, 559 F.2d 1326 (5th Cir.

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667 F.2d 1204, 28 Fair Empl. Prac. Cas. (BNA) 788, 33 Fed. R. Serv. 2d 963, 1982 U.S. App. LEXIS 21681, 28 Empl. Prac. Dec. (CCH) 32,441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/parker-v-anderson-ca5-1982.