Culbertson v. Deloitte Consulting LLP

Background

The plaintiffs and Deloitte Consulting LLP entered into a settlement agreement and release intended to fully and finally resolve the plaintiffs’ claims. The claims arose from a data-security incident involving personal information submitted to pandemic-related unemployment-claim systems in Illinois, Colorado, and Ohio. The court held a final approval hearing on January 31, 2022. One objection was submitted and overruled. Jessica Haiman had previously been voluntarily dismissed from the action.

Settlement Approval and Class Certification

The court finally approved the settlement under Federal Rule of Civil Procedure 23(e), finding it fair, reasonable, adequate, and in the best interests of the settlement class. The court found that the agreement resulted from extensive investigation, vigorous arm’s-length negotiations assisted by an experienced mediator, and good-faith work by experienced counsel. It found no evidence of collusion.

The court reaffirmed a settlement class consisting of 237,675 individuals in Illinois, Colorado, and Ohio who had been notified by state agencies between approximately May 18 and May 21, 2020, that personal information submitted in connection with pandemic-related unemployment claims may have been inadvertently exposed. The court reaffirmed the appointment of the settlement class representatives and class counsel. It found the requirements for class certification satisfied for settlement purposes, including numerosity, common legal and factual questions, typical claims, adequate representation, predominance of common questions, and superiority of class resolution.

If the settlement’s effective date did not occur, or if the settlement terminated, the settlement-class certification would become void or be vacated as specified in the order, and the parties would return to their prior positions without prejudice to their rights or arguments.

Notice, Opt-Outs, and Releases

The court found that the notice plan was the best practicable notice under the circumstances and adequately informed class members about the action, settlement terms, rights to object or opt out, and the binding effect of the final approval order and judgment. It also found that the notice satisfied constitutional due-process requirements, Rule 23, and the Class Action Fairness Act’s notice provisions.

Ten settlement class members submitted timely and proper requests for exclusion. Those individuals were excluded, would not be bound by the settlement, and would not receive its benefits. Class members who did not submit timely and valid claim forms were not entitled to settlement proceeds but remained bound by the settlement terms, including its release.

Upon the settlement’s effective date, participating class members and other releasing parties would release the defined claims against Deloitte and the listed Deloitte-related releasees. The order states that the settlement and related acts were not admissions of the validity of the plaintiffs’ claims or of fault or omission by Deloitte. The settlement would be the exclusive remedy for released claims, and the order permanently barred specified lawsuits and other proceedings based on those claims.

Dismissal and Continuing Jurisdiction

The court ordered that the action be dismissed with prejudice on the merits and without costs to any party or person, except as otherwise provided in the order or settlement agreement. It approved the settlement account as a qualified settlement fund and retained continuing and exclusive jurisdiction over the settlement, including its administration, interpretation, enforcement, and related disputes. The court directed the parties to implement and complete the settlement and directed the clerk to close the file.

Fees, Costs, and Service Awards

The court approved $1,649,835 in attorneys’ fees for class counsel, equal to 33.33 percent of the $4,950,000 settlement fund. It also found that class counsel incurred $20,509.34 in litigation costs and expenses and approved reimbursement of those costs from the settlement fund. The court found the requested fees and expenses fair, reasonable, and appropriate after considering the settlement, the litigation’s complexity and risks, counsel’s work, and the benefits obtained.

The court approved a $1,500 service award for each settlement class representative based on the representatives’ participation, the risks they faced, the time and effort they spent, and the benefits they helped obtain for the class. The fees, costs, and service awards were to be paid and distributed under the settlement agreement.