A $6.5 million settlement proposed by plaintiffs in the Chicken of the Sea price-fixing lawsuit has been denied preliminary approval by U.S. District Judge Janis L. Sammartino. The settlement aimed to resolve allegations that Chicken of the Sea conspired with other seafood companies to fix the prices of canned tuna products. However, the judge found the settlement agreement to have numerous problems, leading her to deny the plaintiffs’ motion for approval.
The written settlement agreement did not show that the deal was negotiated at arm’s length, which helps ensure the parties involved are not influencing each other and adds legal credibility to an agreement. Judge Sammartino wrote in her denial, “The motion is not accompanied by any declaration in support of its factual assertions, including the assertion that the settlement was negotiated at arm’s length. Several factual issues must be considered to eventually approve the settlement.”
Additionally, Judge Sammartino found the distribution of the settlement fund to be too low in terms of Class payments. Considering that the company admitted to wrongdoing in a criminal antitrust case, the judge reportedly wanted to see higher payments towards affected parties. Instead, 77% of the $6.5 million settlement, or $5 million, was reportedly directed towards attorneys’ fees and costs. The fees themselves were reportedly set to be $3 million – equal to 46 percent of the settlement fund.
“Distribution of a disproportionate part of the settlement to counsel is one of the indicators that class counsel may not have negotiated in the best interest of the class,” Judge Sammartino said.
The plaintiffs’ attorneys have stated that they will work with defendant lawyers to revise their deal. “We have been in touch with defense counsel and believe that both sides are committed to exploring ways to improve the agreement, better explain it, and make a more complete and clear record for the court’s consideration,” the attorneys noted.
The plaintiffs brought claims against several other canned tuna companies including StarKist, which have been consolidated into a multidistrict litigation in December 2015. Last year, the MDL won class certification.
If you have been affected by the alleged Chicken of the Sea price-fixing scheme, you can share your experience in the comment section below. The plaintiffs are represented by attorneys from Cuneo Gilbert; Joseph Saveri Law Firm Inc.; Derfner & Altman; Lovelace & Associates PA; Del Mar Law Group LLP; Barrett Law Group PA; Thrash Law Firm PA; Larson King LLP; Arthur N. Bailey & Associates; Neal & Harwell PLC; Lite Depalma Greenberg LLC; and Shindler Anderson Goplerud & Weese PC. The Chicken of the Sea Class Action Lawsuit is In re: Packaged Seafood Products Antitrust Litigation, Case No. 3:15-md-02670, in the U.S. District Court for the Southern District of California.
