What is a Fair Price for Objector Blackmail? Class Actions, Objectors, and the 2018 Amendments to Rule 23

Abstract

As part of a symposium addressing what the next 50 years might hold for class actions, mass torts, and MDLs, this Article examines a recent amendment to Rule 23 that offers a new solution to the persistent problem of strategic objections. Most significantly, Rule 23 now requires the district judge to approve any payments made to class members in exchange for withdrawing or forgoing challenges to a class action settlement. Although the new provision is still in its infancy, it has already been deployed to thwart improper objector behavior and to bring for-pay objection practice out of the shadows. The 2018 changes — along with other on-the-ground developments — are important steps toward improving the class action settlement process.

Keywords: Class Actions, Settlement, Objectors, Rule 23, Rule 23(e)(5), 2018 Amendment

JEL Classification: K00, K10, K40, K41