In re California Gasoline Spot Market Antitrust Litigation

Background

Plaintiffs brought state antitrust and unjust-enrichment claims against SK Energy Americas, Inc., Vitol Inc., and two individual defendants. They alleged that the defendants formed agreements to restrain competition and manipulate the spot market for gasoline and gasoline blending components formulated for use in California.

The California Attorney General separately brought an action in San Francisco Superior Court on behalf of the People of California. In this federal litigation, 23 related actions were consolidated for trial purposes. The court appointed Hausfeld and Girard Sharp as co-lead interim class counsel. After motions to dismiss and while class-certification proceedings were pending, the parties reached a settlement.

The court had preliminarily approved the settlement on August 23, 2024. After notice was provided, the court considered the pending motions for final approval and for attorneys’ fees, costs, and service awards.

Settlement Terms and Notice

The settlement class included natural persons who were not California residents when they made their purchases, and non-natural persons located anywhere, who purchased gasoline from a retailer for their own use—not resale—in California between February 18, 2015, and May 31, 2017. The class excluded, among others, the California Attorney General in the separate action, the defendants and their affiliates, class counsel and their employees, court personnel, and people who timely excluded themselves.

The defendants were required to establish a non-reversionary gross settlement fund of $13.9 million. The fund could be reduced by notice and administration costs, litigation costs, and service awards. The allocation plan divided the net fund between businesses and non-California consumers. It allocated 85 percent to businesses and 15 percent to non-California natural persons, subject to the plan’s stated limitation, and gave Southern California purchases twice the weight of Northern California purchases.

The settlement administrator used email, postcard, digital, website, and telephone notice. The administrator reported 8,175 timely claims—1,548 from businesses and 6,627 from individuals—60 timely exclusion requests, and no objections. The court found that the notice plan provided the best practicable notice required by Federal Rule of Civil Procedure 23.

Final Settlement Approval

Under Rule 23(e), a court may finally approve a class settlement only if it is fair, adequate, and reasonable and was not the product of collusion. The court incorporated its earlier analysis finding that the class satisfied the class-certification requirements because no relevant facts had changed.

The court concluded that the settlement’s fairness factors supported approval. It considered the risks and expense of continued litigation, including uncertainty over class certification and the parties’ competing expert analyses concerning liability and damages. The court found that the $13.9 million settlement was within the range of possible approval, that the parties had enough information to make an informed settlement decision, and that experienced counsel supported the agreement. The court also considered the absence of objections and the claims rate, which it found did not weigh against approval.

The court separately examined possible signs of collusion. Although the requested percentage fee raised a potential concern, the court found that the fee request was below counsel’s lodestar and did not indicate collusion. The agreement did not contain a provision requiring defendants not to oppose the fee request, and it was non-reversionary. The court therefore found that the agreement resulted from arms-length negotiations and satisfied Rule 23(e).

Attorneys’ Fees and Costs

Class counsel requested 30 percent of the net settlement fund in attorneys’ fees. The court found an upward adjustment from the Ninth Circuit’s 25-percent benchmark appropriate because counsel achieved substantial results, faced significant litigation risks, sought fees from the net rather than gross fund, and received no objections to the fee request. Using the lodestar method as a cross-check, the court considered counsel’s reported lodestar of $17,721,644.50 and found the requested fee reasonable. The court awarded $2,011,669.82 in attorneys’ fees, described in the conclusion as 30 percent of the net settlement amount.

Class counsel initially requested $6,554,433.95 in litigation costs. After supplemental information was submitted, the court found the expenses sufficiently substantiated and awarded $6,544,433.95 in litigation costs. The court also noted that the settlement administrator had agreed to cap administration costs at $650,000.

Class Representative Awards and Additional Orders

The three settlement class representatives—Fricke-Parks Press, Inc., Bogard Construction, Inc., and Ritual Coffee Roasters, Inc.—requested $5,000 each. The court denied the total $15,000 request because the representatives did not submit declarations describing their work, and counsel’s general description did not provide enough evidence about the quantity or quality of their representative service.

The court allowed people and entities who contacted the settlement administrator or class counsel by January 28, 2025, about missing the January 8 deadline because of the Southern California wildfires to submit late claims. The administrator was ordered to notify them within 14 days, and they were given 30 days from the order to submit claims. The court also ordered class counsel to file a post-distribution accounting and directed the parties to file a proposed judgment.

Disposition

The court granted the motion for final approval of the class settlement. It granted the motion for attorneys’ fees and costs, awarding $2,011,669.82 in attorneys’ fees and $6,544,433.95 in litigation costs, and denied the request for $15,000 in incentive awards. The order disposed of Docket Nos. 621 and 622.