Senne v. Office of the Commissioner of Baseball

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 AARON SENNE, et al., 7 Case No. 14-cv-00608-JCS Plaintiffs, 8 v. ORDER RE JOINT LETTER BRIEF 9 KANSAS CITY ROYALS BASEBALL Re: Dkt. No. 1194 10 CORP., et al., 11 Defendants.

12 13 I. INTRODUCTION 14 On April 27, 2023, Plaintiffs and certain individuals represented by Mssrs. Kornhauser and 15 David (“Objectors”)1 filed a joint discovery letter in connection with Plaintiffs’ noticing of the 16 Objectors’ depositions. Dkt. no. 1194. Defendants filed a response on the same date. Dkt. no. 17 1195. The Court requested additional briefing and that briefing is now complete. The two 18 disputes the Court resolves herein are as follows: 1) will the appeal by Daniel Concepcion, 19 Anthony Garcia, Sidney Duprey Conde, and Aldemar Burgos (“Appealing Objectors”) of the 20 Court’s approval order and judgment delay the implementation of the Class Action settlement in 21 this case; and 2) should Plaintiffs be permitted to depose the Appealing Objectors.2 The answer to 22 both questions is yes.3 23 24 1 Objectors, for the purposes of the instant discovery dispute, are: Yadel Marti, Sergio Miranda, 25 Juan Valdez, Jose Diaz, Helder Velazquez, Daniel Concepcion, Brahiam Maldonado, Anthony Garcia, Sidney Duprey Conde, and Aldemar Burgos. 26 2 Although Plaintiffs initially sought to depose objectors who are not named on the appeal, they stipulated in their supplemental brief that they ask the Court to compel the depositions only of the 27 Appealing Objectors. II. IMPACT OF APPEAL ON IMPLEMENTATION OF SETTLEMENT 1 AGREEMENT 2 The Objectors assert that their appeal is only a “very limited appeal . . . from the separate 3 distribution and award of attorney’s fees and does not affect the Final Approval Order.” Dkt. no. 4 1204 at 5 (citing dkt. no. 1173-1, Ex. 1 (Settlement Agreement), ¶ 14(b)). They are incorrect. 5 California law governs the interpretation of the Settlement Agreement. Dkt. no. 1173-1, 6 Ex. 1 (Settlement Agreement), ¶ 36. Under California law, “[t]he language of a contract is to 7 govern its interpretation, if the language is clear and explicit, and does not involve an absurdity.” 8 Cal. Civ. Code section 1638. Here, the language of the relevant provisions of the Settlement 9 Agreement is clear. Defendants’ funding of the settlement, the distribution of payments to class 10 members, and issuance of MLB’s memorandum to the Major League Clubs are all conditioned 11 upon the occurrence of the Effective Date. Dkt. no. 1173-1, Ex. 1 (Settlement Agreement), ¶¶ 12, 12 14, 21. The Effective Date, in turn, is defined as “the last of the following dates: (i) if there is no 13 appeal of the Court’s Final Approval Order, the day after the deadline for taking an appeal has 14 passed; or (ii) if there is an appeal of the Court’s Final Approval Order, the day after all such 15 appeals are resolved in favor of final approval.” Id. ¶ 1(m) (emphasis added). Unless the 16 Objectors drop their appeal, there can be no doubt that the Effective Date will occur only if and 17 when the Court’s final approval order is affirmed on appeal. 18 Objectors’ argument to the contrary is frivolous. Objectors contend that under Paragraph 19 1(m)(i) of the Settlement Agreement, the Effective Date was May 1, 2023 – 30 days after the 20 Court entered judgment in this case – because they are not actually appealing the Final Approval 21 Order but instead, are only appealing the Court’s fee award. They reason that their appeal relates 22 only to the Court’s fee award because they ask the Court of Appeals to deduct $6.5 million of the 23 $55.5 million awarded in attorneys’ fees and pay it to what they describe as the “outside 24 settlement class players.” See dkt. no. 1193 (Notice of Appeal). As the Court has already 25 explained, however, there is no outside settlement class. Dkt. no. 1190 at 25. The Objectors are 26 members of the settlement class in this case and to the extent they are challenging the amount of 27 their settlement payments, they are challenging the allocation formula that is at the heart of the 1 and approved by the Court. There is no question that the Effective Date, under these 2 circumstances, is governed by Paragraph 1(m)(ii) of the Settlement Agreement and thus, that the 3 Effective Date is the day after the Objectors’ appeal is resolved in favor of final approval. 4 III. WHETHER PLAINTIFFS SHOULD BE PERMITTED TO DEPOSE APPEALING OBJECTORS 5 Plaintiffs have narrowed their request for an order compelling depositions to the Appealing 6 Objectors. The Court finds that request to be reasonable. 7 “Plaintiffs may seek information from objectors to obtain relevant, needed, and reasonably 8 narrowly tailored information regarding each objector’s standing as a settlement class member to 9 assert objections, the underlying basis for his objections, and his relationship with counsel that 10 may be pertinent to informing the court about the nature and merits of the appeal.” In re Netflix 11 Priv. Litig., No. 5:11-CV-00379-EJD, 2013 WL 6173772, at *5 (N.D. Cal. Nov. 25, 2013). This 12 information may be used in connection with a motion in this Court, such as a motion for 13 imposition of an appeal bond or for sanctions, or in a variety of possible motions in the appellate 14 proceeding. See, id. at *2 (“discovery may be utilized to ensure that each objector is capable of 15 posting bond in the full amount” and to “pursue information regarding Objectors’ standing in 16 regards to their appeals”); In re Itel Sec. Litig., 596 F. Supp. 226, 233 (N.D. Cal. 1984), aff’d, 791 17 F.2d 672 (9th Cir. 1986) (holding in post-judgment proceedings that the court “possessed the 18 inherent power to award attorneys’ fees as a means of protecting the integrity of the judicial 19 process and that this inherent authority extend[ed] to considering class plaintiffs’ request for 20 attorneys’ fees, costs, and sanctions”); Rutter Group Practice Guide: Federal Ninth Circuit Civil 21 Appellate Practice at § 6:537 (“Evidence outside the district court record that is relevant to the 22 motion’s disposition should be presented by affidavit or declaration and served and filed with the 23 motion.”). 24 Here, Objectors’ counsel has a long history of bringing meritless motions in this case and 25 three of the Objectors are also represented by Mr. Kornhauser in a separate case against MLB, 26 Concepcion, et al. v. Office of the Commissioner of Baseball, et al., D. P.R. Case No. 22-cv- 27 01017-ADC (including Objectors Daniel Concepcion, Sidney Duprey Conde, and Aldemar 1 Burgos as named plaintiffs). Furthermore, Objectors’ counsel has repeatedly made the frivolous 2 assertion that the appeal will not delay implementation of the Settlement Agreement — a gross 3 misrepresentation of the terms of the Settlement Agreement that may also have been made to the 4 ||} Objectors. These indicia that the Objectors’ appeal may be lawyer-driven and/or based on 5 misconceptions about basic facts related to the terms of the Settlement Agreement provide a 6 || sufficient basis to support Plaintiffs’ request for an order compelling the depositions of the 7 Appealing Objectors. 8 || IV. CONCLUSION 9 For the reasons stated above, the Court ORDERS that within 45 days of the date of this 10 Order, the Appealing Objectors shall sit for depositions, not to exceed four hours each, on the 11 following subject-matter: 1) the specific grounds for their objections to the settlement; 2) their 12 || relationships with Mssrs. Kornhauser and David; 3) whether they can post an appellate bond and 13 pay for the costs incurred by Plaintiffs on appeal; and 4) whether they understand the basic terms 14 || of the Settlement Agreement, including the terms related to the Effective Date of the agreement 3 15 and its implementation. a 16 IT IS SO ORDERED.

|] Dated: June 7, 2023 19 ZZ c EE J PH C. SPERO 20 nited States Magistrate Judge 21 22 23 24 25 26 27 28