Preliminary Report on Class-Action Settlement Distributions in the Northern District of California

Abstract

Recognizing that many cases brought as class actions result in settlements, the Civil Rules Advisory Committee amended Rule 23 of the Federal Rules of Civil Procedure in 2018 “to address issues related to settlement.” A “basic focus” of the Advisory Committee was “the extent and types of benefits that settlement will confer on members of the class.” Because most class-action settlements involve a common-fund resolution, the Advisory Committee observed that “the relief actually delivered to the class can be a significant factor in determining the appropriate fee award” to class counsel.”

What relief is “actually delivered” to class members under a settlement’s terms is often difficult to determine. Accordingly, the United States District Court for the Northern District of California promulgated, on November 1, 2018, Procedural Guidance for Class Action Settlements. The Guidance sought systematically to incorporate the 2018 Amendment objectives by requiring a post-distribution accounting to measure the extent and type of benefits that class-action settlements in the Northern District actually confer on class members.

This preliminary report assesses whether and to what extent the Guidance has, in its first three years, achieved its objectives. It also offers recommendations to enhance the Guidance and improve settlement administration.

Keywords: class actions, settlements, settlement administration, settlement distributions