Vianu v. AT&T Mobility LLC

Background

Ian Vianu, Elizabeth Blum, and Dominic Gutierrez brought a class action against AT&T Mobility LLC. They alleged that AT&T advertised flat monthly wireless-service rates and then added a monthly administrative fee after customers enrolled. The claims asserted violations of California’s Unfair Competition Law, False Advertising Law, and Consumer Legal Remedies Act; a request for permanent public injunctive relief; and breach of the implied covenant of good faith and fair dealing.

The parties conducted extensive discovery, including reviewing more than 60,000 pages of documents, taking five depositions, analyzing account and fee data, and conducting third-party discovery. They reached a settlement after two mediations. The court had previously granted preliminary approval and held a final fairness hearing.

Settlement Class and Relief

For settlement purposes, the court certified a Rule 23(b)(3) class consisting of California consumers with postpaid AT&T wireless service through consumer or individual-responsibility-user accounts who were charged an administrative fee between June 20, 2015, and the date of preliminary settlement approval. The class excludes people with corporate-responsibility-user accounts and certain consumers who had submitted an unresolved written notice of dispute before May 10, 2022.

The settlement covers approximately 5.65 million account numbers. It establishes a fully non-reversionary $14 million settlement fund. Deductions include estimated administrative costs of $1,211,791.26, $3.5 million in attorney fees, $74,993.24 in litigation expenses, and $3,500 service awards for each of the three named plaintiffs. Class members who submit valid claims will receive equal shares of the remaining money. The plaintiffs estimated individual payments at about $17.25. Current AT&T customers will generally receive account credits, while former customers will receive mailed checks.

Settlement class members release claims concerning the issues in the case. The court also permanently barred and enjoined class members from pursuing released claims against released parties, while preserving actions to enforce the settlement agreement.

Court’s Analysis

The court found that the settlement class satisfied Rule 23’s requirements for settlement purposes. The class was sufficiently numerous, common questions concerned AT&T’s administrative fee and alleged disclosures, the representatives’ claims were typical, and the representatives and counsel adequately represented the class. The court also found that common issues predominated and that a class action was superior because individual recoveries were relatively small.

Applying Rule 23’s settlement-approval standards, the court found the agreement fair, reasonable, and adequate and free from collusion. The court considered the estimated recovery, the risks and expense of continued litigation, the fact that class certification had not yet occurred, the extensive discovery, the arm’s-length negotiations, and the favorable class response. There were two objections and fourteen exclusion requests.

The court rejected Jennifer Wilson’s objection that the recovery was inadequate, concluding that the settlement provided compensation roughly equal to six months of average administrative fees. The court rejected Eric Hughes’s objections concerning AT&T’s continued ability to charge the fee, the absence of permanent injunctive relief, and the release. The court also addressed website concerns raised by Stephanie August and David Ross and found that the Settlement Administrator had sufficiently responded to those issues.

Fees, Expenses, Appointments, and Notice

The court awarded class counsel $3.5 million in attorney fees, equal to 25 percent of the settlement fund, and approved $74,993.24 in expenses. It found the fee request reasonable based on the benefits obtained, counsel’s work over more than three years, the litigation risks, and a lodestar cross-check.

The court confirmed the appointments of Vianu, Blum, and Gutierrez as class representatives; Angeion Group as Settlement Administrator; and the identified attorneys and law firms as settlement class counsel. It approved Angeion’s administrative-cost award of $1,211,791.26. The court also found that the notice program satisfied the applicable legal and due-process requirements.

Disposition

The court approved the class-action settlement, including attorney fees and expenses, administrative costs, and service awards. It directed the parties and the Settlement Administrator to implement the agreement and distribute the settlement payments. The action was dismissed with prejudice and without costs to any party except as provided in the settlement agreement and Final Order. The court retained jurisdiction over implementation, administration, interpretation, enforcement, and distribution matters. The order stated that the time to appeal began when the Final Order was entered.