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Rawa v. Monsanto Co.

United States Court of Appeals, Eighth Circuit

August 20, 2019

Joshua Rawa, on behalf of himself and all others similarly situated; Elisabeth Martin; Robert Ravencamp; Amy Ward; Cynthia Davies; Christopher Abbott; Owen Olson; Jeannie A. Gilchrist; Zachary Sholar; Matthew Myers; John W. Beard, Jr.; Michael Overstreet Plaintiffs - Appellees
v.
Monsanto Company Defendant-Appellee
v.
James Migliaccio Objector - Appellant Patrick Sweeney Objector

          Submitted: April 16, 2019

          Appeal from United States District Court for the Eastern District of Missouri - St. Louis

          Before SMITH, Chief Judge, ARNOLD and KELLY, Circuit Judges.

          Smith, Chief Judge.

         Appellant-objector James Migliaccio was a member of a California class action against Monsanto Company that alleged the company used misleading labeling on its Roundup concentrate herbicide. Following certification of the California class in the Central District of California, class counsel filed the present action in the Eastern District of Missouri on behalf of a putative class of consumers from the other 49 states. The parties reached a nationwide settlement agreement. The Central District of California transferred the California action to Missouri, where Monsanto resides, in order to consolidate the cases and seek preliminary approval of the nationwide settlement. The federal district court[1] in Missouri granted preliminary approval of the settlement and its notice plan. After the notice period ended, the plaintiffs filed for final approval of the settlement. Migliaccio objected to certification of the nationwide class and to the fairness of the settlement on several grounds. The district court overruled his objection and granted final approval. Upon review, we conclude that the class members were adequately represented and that the settlement was reasonable, fair, and adequate. We therefore affirm.

         I. Background

         Monsanto manufactures and markets Roundup, a well-known herbicide, in both concentrate and ready-to-use forms. The company marketed its concentrate products, which require dilution before using, as a better value for consumers. In this class action lawsuit, plaintiff consumers alleged that Monsanto misled them about the concentration strength of these products through its product labeling. In doing so, plaintiffs claim, Monsanto implicitly misrepresented their value-by nearly 50 percent on some units. As an example, one product's label advertised that it could be used to make up to ten gallons. But consumers discovered that, when diluted according to package instructions, the product only made just over five gallons.

         Class counsel originally filed the suit in the Central District of California on behalf of a nationwide class. The court, however, eventually certified only a California class. Class counsel subsequently filed a complaint in Missouri, Monsanto's principal location, on behalf of a putative class of consumers from the other 49 states. The complaint alleged violations of both federal and Missouri laws. The parties negotiated and reached a tentative nationwide settlement. Other similar actions had been filed in courts across the country, and class counsel reached out to the plaintiffs in each case to advise them of the settlement's terms. Each agreed to support the settlement in exchange for class counsel's promise to seek incentive awards and reimbursement for costs and fees.

         Class counsel moved the Central District of California to transfer the action to the Eastern District of Missouri, seeking consolidation with the 49-state class action. The court granted the motion.

         The plaintiff class then moved the federal district court in the Eastern District of Missouri for preliminary approval of the nationwide settlement, which covered over four million retail units representing about $164 million in retail sales. The motion set forth a notice plan, designed by the class administrator, which estimated a class size of approximately 3.5 million members who bought the products during the relevant time period. The notice plan targeted over 20 million people who had used weed killer products in the past. The plan assumed that the class members would be included among that number and receive adequate notice of the settlement. The court granted preliminary approval of the settlement and approved the proposed notice plan.

         According to the terms of the settlement, Monsanto would establish a $21.5 million non-reversionary Common Fund for claims, notice, and administration costs; incentive awards; and attorneys' fees. Class counsel could apply for fees up to one-third of the Common Fund for their services. Any remaining unclaimed funds would be donated to cy pres recipients.[2]

         After the notice period ended and the claims were processed, the plaintiffs moved for final approval of the settlement and for attorneys' fees. The class administrator testified that it had validated a total of 70, 360 claims, valued at $10, 732, 832. Since the claims correspond to a 50 percent refund for the consumers' affected purchases, the class administrator testified that the value of the claims represented over $21 million in retail sales. Because Monsanto made $164 million in retail sales for the relevant period, this produced a claims rate of 13 percent. Class counsel sought one-third of the Common Fund ($7, 166, 666) for attorneys' fees.

         Migliaccio filed an objection opposing class certification and final approval of the settlement. He asserted that consolidation of the California class with the nationwide class diluted the California class members' claims, creating a conflict of interest for the nationwide class counsel that rendered their representation inadequate. Prior to transfer and consolidation of the California- and Missouri-based classes, counsel consulted with a legal ethics expert to address potential conflict-of-interest concerns. Based on the expert's advice, counsel represented to the court that no conflict existed. Migliaccio challenged the fairness of both the proposed settlement terms and the attorneys' fee award. He demanded that the nationwide class counsel produce the expert ethics opinion sought before the transfer, and he urged the court to perform a lodestar cross-check on the attorneys' fee award.

         The court asked class counsel to submit detailed billing records and rates to support the motion for attorneys' fees and then held a two-hour fairness hearing, in which Migliaccio participated. Following the hearing, the court entered an order granting final certification to the nationwide class, final ...


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