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Alexia Keil v. Paul Lopez, 16-3159 (2017)

Court: Court of Appeals for the Eighth Circuit Number: 16-3159 Visitors: 22
Filed: Jul. 05, 2017
Latest Update: Mar. 03, 2020
Summary: United States Court of Appeals For the Eighth Circuit _ No. 16-3159 _ Alexia Keil; Nick Hutchison; Jason Davis, individually and on behalf of all others similarly situated; Rachael D. Stone; Maja Mackenzie; Brian Andacky; Melissa Baggett; David Delre; Christopher Renna; Kimberly Lemon; Joshua Teperson; Jonathon Fisher; Cindi Inman; Beth Cox; Victoria Lyman; Stephanie Douglas; Sarah Jacobs, on behalf of herself and others similarly situated lllllllllllllllllllll Plaintiffs - Appellees Blue Buffal
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                 United States Court of Appeals
                            For the Eighth Circuit
                        ___________________________

                                No. 16-3159
                        ___________________________

Alexia Keil; Nick Hutchison; Jason Davis, individually and on behalf of all others
 similarly situated; Rachael D. Stone; Maja Mackenzie; Brian Andacky; Melissa
 Baggett; David Delre; Christopher Renna; Kimberly Lemon; Joshua Teperson;
  Jonathon Fisher; Cindi Inman; Beth Cox; Victoria Lyman; Stephanie Douglas;
          Sarah Jacobs, on behalf of herself and others similarly situated

                      lllllllllllllllllllll Plaintiffs - Appellees

                          Blue Buffalo Company, Ltd.

                      lllllllllllllllllllll Defendant - Appellee

                                          v.

                                     Paul Lopez

                       lllllllllllllllllllllObjector - Appellant

                        ___________________________

                                No. 16-3164
                        ___________________________

Alexia Keil; Nick Hutchison; Jason Davis, individually and on behalf of all others
 similarly situated; Rachael D. Stone; Maja Mackenzie; Brian Andacky; Melissa
 Baggett; David Delre; Christopher Renna; Kimberly Lemon; Joshua Teperson;
  Jonathon Fisher; Cindi Inman; Beth Cox; Victoria Lyman; Stephanie Douglas;
          Sarah Jacobs, on behalf of herself and others similarly situated

                      lllllllllllllllllllll Plaintiffs - Appellees
                          Blue Buffalo Company, Ltd.

                      lllllllllllllllllllll Defendant - Appellee

                                          v.

                                  Pamela McCoy

                       lllllllllllllllllllllObjector - Appellant

                        ___________________________

                                No. 16-3167
                        ___________________________

Alexia Keil; Nick Hutchison; Jason Davis, individually and on behalf of all others
 similarly situated; Rachael D. Stone; Maja Mackenzie; Brian Andacky; Melissa
 Baggett; David Delre; Christopher Renna; Kimberly Lemon; Joshua Teperson;
  Jonathon Fisher; Cindi Inman; Beth Cox; Victoria Lyman; Stephanie Douglas;
          Sarah Jacobs, on behalf of herself and others similarly situated

                      lllllllllllllllllllll Plaintiffs - Appellees

                          Blue Buffalo Company, Ltd.

                      lllllllllllllllllllll Defendant - Appellee

                                          v.

                                  Caroline Nadola

                       lllllllllllllllllllllObjector - Appellant

                        ___________________________

                                No. 16-3169
                        ___________________________

                                          -2-
Alexia Keil; Nick Hutchison; Jason Davis, individually and on behalf of all others
 similarly situated; Rachael D. Stone; Maja Mackenzie; Brian Andacky; Melissa
 Baggett; David Delre; Christopher Renna; Kimberly Lemon; Joshua Teperson;
  Jonathon Fisher; Cindi Inman; Beth Cox; Victoria Lyman; Stephanie Douglas;
          Sarah Jacobs, on behalf of herself and others similarly situated

                      lllllllllllllllllllll Plaintiffs - Appellees

                          Blue Buffalo Company, Ltd.

                      lllllllllllllllllllll Defendant - Appellee

                                          v.

                                  Gary W. Sibley

                       lllllllllllllllllllllObjector - Appellant
                                      ____________

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

                             Submitted: April 5, 2017
                               Filed: July 5, 2017
                                ____________

Before GRUENDER, MURPHY, and KELLY, Circuit Judges.
                         ____________

GRUENDER, Circuit Judge.




                                          -3-
       Paul Lopez, Pamela McCoy, Caroline Nadola, and Gary Sibley (“objectors”)
appeal the district court’s1 orders approving a class action settlement and awarding
attorneys’ fees. They raise various objections regarding the adequacy of the district
court’s explanation, the fairness of the settlement, the reasonableness of the attorneys’
fees, and the district court’s scheduling orders. For the following reasons, we affirm.

                                 I. BACKGROUND

       Blue Buffalo Company, Ltd. (“Blue Buffalo”) is a manufacturer of pet foods.
In January 2015, plaintiffs brought this class action challenging Blue Buffalo’s
representations about the ingredients in its pet foods. Plaintiffs alleged that Blue
Buffalo broke its “True Blue Promise” that its products contained no chicken or
poultry by-product meals. As a result, they asserted (1) violations of the Magnuson-
Moss Warranty Act (“MMWA”); (2) breach of express and implied warranties; (3)
unjust enrichment; and (4) violations of the consumer protection acts of eight states:
Missouri, New York, California, New Jersey, Illinois, Florida, Ohio, and
Massachusetts. The MMWA, warranty, and unjust-enrichment claims were brought
on behalf of a proposed nationwide class, whereas the consumer protection claims
were brought on behalf of eight proposed subclasses. Class counsel estimated that
the potential class size consisted of 3.5 million households.

      Initially, Blue Buffalo denied all of the material allegations. However, Blue
Buffalo subsequently discovered that some of its suppliers had sent mislabeled
ingredients to manufacturing facilities that produced certain Blue Buffalo products.
Blue Buffalo continued to deny liability, but it filed a third-party complaint against
two of its suppliers in June 2015, seeking indemnification and contribution in the
event it was found liable.


      1
        The Honorable Rodney W. Sippel, Chief Judge, United States District Court
for the Eastern District of Missouri.

                                          -4-
       In October 2015, class counsel and Blue Buffalo began to engage in settlement
talks with a mediator. Less than two months later, the parties reached a settlement
agreement. According to the settlement agreement, Blue Buffalo agreed to pay $32
million into a settlement fund. From this amount, class counsel would request $8
million for attorneys’ fees and expenses, the settlement administrator would request
$1.4 million to cover administrative costs, and the remaining $22.6 million would be
available to pay class members. To receive a portion of this amount, class members
would have two options. Under option 1, class members without pet-food receipts
would receive $5 for every $50 of purchases they made, and they could claim up to
$100 of eligible purchases. Under option 2, class members with receipts would
receive the same $5 for every $50 of purchases, but they could claim up to $2000 in
eligible purchases. Thus, the anticipated maximum recovery was $10 for option 1
members and $200 for option 2 members. However, the payment amounts were
subject to a pro rata adjustment to ensure that all available funds would be distributed
to class members who submitted claims. No amount of the fund would revert to Blue
Buffalo, and a cy pres recipient would receive funds remaining only from uncleared
checks. In addition to monetary relief, the agreement would provide injunctive relief:
Blue Buffalo would ensure that it no longer represents that its products do not contain
chicken or poultry by-product meal until it has reviewed its supplier relationships and
has instituted practices designed to ensure that all ingredients provided by its
suppliers are consistent with its packaging claims.

       On December 18, 2015, the district court conditionally certified the class and
preliminarily approved both the settlement and a proposed notice plan. The court set
April 14, 2016 as the deadline for both claims and objections from class members, set
May 12, 2016 as the deadline for class counsel’s motion for attorneys’ fees, and set
a fairness hearing for May 19, 2016. The court also approved Heffler Claims Group
(“HCG”) as settlement administrator.




                                          -5-
       Using information gathered from Blue Buffalo’s rewards program, HCG sent
direct notice by e-mail or postcard to nearly two million class members. The notices
directed class members to a settlement website containing more information and a
claim form. HCG also directed potential class members to the settlement website
though an advertisement in People magazine, online advertisements, and a press
release. The direct notices and settlement website explained how to receive funds
under options 1 and 2 and mentioned the possibility of a pro rata increase in the
amount received. They further informed class members that class counsel would
request attorneys’ fees of no more than $8,000,000. HCG estimated that the notice
program as a whole had reached more than 87 percent of the class members.

      Shortly before the fairness hearing, HCG informed the district court that, as of
May 9, 2016, it had received 105,173 claims from class members. This number
represented only about 3 percent of the class, and the total amount of valid claimed
purchases was $20,228,797.98. Because $22,600,000 was expected to be available
to pay these claims, claimants would not be limited to the originally anticipated
maximum recovery. Rather, claimants who submitted a valid claim form would
receive the full amount of their claimed purchases, plus a pro rata increase of
approximately 11 percent over the claimed purchase amount. For example, a class
member who submitted a valid claim for $100 of purchases under option 1 would
receive $111 instead of the originally anticipated maximum payment of $10.
Likewise, a class member who submitted a valid claim for $2000 of purchases under
option 2 would receive $2,220 instead of the originally anticipated maximum
payment of $200. This process would exhaust the anticipated $22,600,000 available
to pay class members.

      Fourteen class members submitted written objections to the settlement by the
April 14 deadline. Eight of them also objected to class counsel’s proposed fee. On
May 12, class counsel submitted their motion requesting $8,000,000 in attorneys’ fees
and expenses. In their memorandum in support of the motion, class counsel

                                         -6-
explained why they were entitled to such a fee, and they provided information
regarding the work they performed and their hourly rates. On May 18, one day before
the fairness hearing, one objector, Gary Sibley, filed a supplemental objection
alleging that the district court erred by not requiring class counsel to file the motion
until after the deadline for class members to submit written objections had passed.

      The district court held the fairness hearing on May 19, 2016. During the
hearing, the court announced that it was approving the settlement, awarding
attorneys’ fees, and overruling all objections. The court later issued two written
orders. The first order certified the settlement class, approved the settlement, and
approved the payment of $1,400,000 in administrative expenses to HCG. When
approving the settlement, the court stated that “[t]he factors identified in this circuit
for assessing fairness of the Settlement have all been considered,” but it did not
expressly discuss each factor. The second order awarded attorneys’ fees and
expenses in the amount requested by class counsel. Four of the objectors who
submitted written objections now appeal these two orders.

                                   II. DISCUSSION

       Objectors raise a total of six issues. Three of these issues relate to the district
court’s approval of the settlement. First, Lopez and McCoy argue that the district
court abused its discretion by failing to explain its basis for approving the settlement.
Second, Lopez and McCoy argue that the relevant factors weigh against approving
the settlement. Third, Nadola argues that the court erred by approving a settlement
that provides everyone in the country with the opportunity to receive the same amount
regardless of the consumer protection laws of the states in which they purchased Blue
Buffalo products. The remaining three issues relate to the award of attorneys’ fees.
First, Lopez, McCoy, and Sibley argue that the amount of attorneys’ fees was
excessive in light of the allegedly poor outcome for the class. Second, Lopez argues
that the court should not have included administrative costs as a benefit to the class

                                           -7-
when calculating attorneys’ fees. Third, Sibley argues that the court violated Federal
Rule of Civil Procedure 23(h) by scheduling the deadline for class members to submit
written objections on a date before the deadline for class counsel to file their motion
for attorneys’ fees. We address each of these arguments in turn.

                               A. Settlement Approval

       We review a district court’s order approving a class action settlement for abuse
of discretion. Marshall v. Nat’l Football League, 
787 F.3d 502
, 508 (8th Cir. 2015).
“The court’s role in reviewing a negotiated class settlement is . . . to ensure that the
agreement is not the product of fraud or collusion and that, taken as a whole, it is fair,
adequate, and reasonable to all concerned.” 
Id. at 509
(quotations omitted).
Objectors do not contend that the settlement agreement is the product of fraud or
collusion. Rather, they argue that it is not fair, reasonable, and adequate. To
determine whether a settlement is “fair, reasonable, and adequate,” district courts
must analyze the four factors from Van Horn v. Trickey: “[(1)] the merits of the
plaintiff’s case, weighed against the terms of the settlement; [(2)] the defendant’s
financial condition; [(3)] the complexity and expense of further litigation; and [(4)]
the amount of opposition to the settlement.” 
840 F.2d 604
, 607 (8th Cir. 1988). On
appeal, “we ask whether the District Court considered all relevant factors, whether
it was significantly influenced by an irrelevant factor, and whether in weighing the
factors it committed a clear error of judgment.” 
Marshall, 787 F.3d at 508
(citation
and alternations omitted).

                   1. District Court’s Explanation of Its Decision

      Lopez and McCoy first argue that the district court abused its discretion
because its final order approving the settlement contained no analysis of two of the
Van Horn factors. On this basis alone, they ask that we vacate the district court’s
order and remand for reconsideration. Indeed, as we noted in Van Horn, “Although

                                           -8-
in approving a settlement the district court need not undertake the type of detailed
investigation that trying the case would involve, it must nevertheless provide the
appellate court with a basis for determining that its decision rests on well-reasoned
conclusions and not mere 
boilerplate.” 840 F.2d at 607
(citations and quotations
omitted). However, we also explained that “if the record contains facts supporting
the district court’s approval of the settlement, a reviewing court would be properly
reluctant to attack that action solely because the court failed adequately to set forth
its reasons or the evidence on which they were based.” 
Id. (quotations omitted).
        In Van Horn, the district court “summarily concluded, in a three-page opinion,
that . . . ‘[t]he Court has carefully reviewed the written analysis made by the experts
and agrees with those experts that the proposed consent decree does provide
sufficient framework for the resolution of the complaints made by the class of
plaintiffs.’” 
Id. (alterations in
original). We observed that “[t]his analysis fails to
address sufficiently the [necessary] factors” and stated that “[t]he district court’s
unexplained failure to follow the clearly expressed procedural law of this circuit gives
us some concern.” 
Id. Nevertheless, we
affirmed the district court’s order approving
the settlement because the record contained facts demonstrating that the settlement
provided “substantial benefits to the class” and thus was “fair, reasonable, and
adequate.” 
Id. at 607-08
(citation omitted). We also followed this approach in In re
Flight Transportation Corp. Securities Litigation, in which we affirmed the approval
of a settlement agreement despite the lack of an explanation by the district court
because “the record reflect[ed] that the District Court had before it the information
necessary to consider the fairness of the [settlement agreement].” 
730 F.2d 1128
,
1136 (8th Cir. 1984).

       Lopez responds that we should no longer follow this approach. Rather, he
asserts that we should follow the approach taken in a recent class-certification case,
In re Target Corp. Customer Data Security Breach Litigation, 
847 F.3d 608
(8th Cir.
2017). There, we remanded the case solely because “the district court failed to

                                          -9-
articulate its analysis of the numerous disputed issues of law and fact regarding the
propriety of class certification.” 
Id. at 615.
Lopez acknowledges that the instant case
involves settlement approval rather than class certification but maintains that this
distinction does not warrant a different approach.

       On the contrary, this distinction fully explains the less forgiving approach
applied in the class-certification context. Specifically, “[a] district court may not
certify a class until it ‘is satisfied, after a rigorous analysis,’ that Rule 23(a)’s
certification prerequisites are met.” 
Id. at 612
(quoting Wal-Mart Stores, Inc. v.
Dukes, 
564 U.S. 338
, 351 (2011)). As we noted in Target, “[t]hough the Supreme
Court has not articulated what, specifically, a ‘rigorous analysis’ of class certification
prerequisites entails, at a minimum the rule requires a district court to state its reasons
for certification in terms specific enough for meaningful appellate review.” 
Id. Hence, a
court’s failure to state its reasons for class certification constitutes a failure
to conduct the “rigorous analysis” specific to class certification. See 
id. The same
“rigorous analysis” standard simply does not apply to settlement approvals, and so we
will not remand solely on the basis of an inadequate explanation.

       That said, we cannot disagree with Lopez’s contention that the district court
failed to discuss two of the Van Horn factors adequately. Other courts tend to list the
factors and proceed systematically to analyze each one, devoting at least one
paragraph to each factor. See, e.g., Huyer v. Wells Fargo & Co., 
314 F.R.D. 621
,
626-28 (S.D. Iowa 2016); Khoday v. Symantec Corp., No. 11-cv-180, 
2016 WL 1637039
, at *5-6 (D. Minn. April 5, 2016). Here, in contrast, the district court simply
asserted that “[t]he factors identified in this circuit for assessing fairness of the
Settlement have all been considered.” To be sure, in the same paragraph, the court
briefly discussed Blue Buffalo’s financial condition and the amount of opposition to
the settlement. However, it provided no analysis of the other two factors: the merits
of the plaintiff’s case weighed against the terms of the settlement; and the complexity
and expense of further litigation. Although the court may have alluded to these two

                                           -10-
factors later in the order when it stated that “[t]he relief obtained here, when weighed
against the complexities and uncertainties of the litigation and the certainty of lengthy
litigation in the absence of a settlement, support the Settlement, which avoids
significant risk and delay and affords meaningful relief to Settlement Class
Members,” it did not explain how it made this evaluation. Rather, “[t]hese remarks
are conclusions, not reasons.” See 
Target, 847 F.3d at 612
.

       Thus, as in Van Horn, “[t]he district court’s unexplained failure to follow the
clearly expressed procedural law of this circuit gives us some concern.” 
See 840 F.2d at 607
. Nevertheless, “the record reflects that the District Court had before it the
information necessary to consider the fairness of the [settlement agreement],” and
thus “we shall review the District Court’s action on the basis of the record before us.”
See Flight Transp. 
Corp., 730 F.2d at 1136
. As explained below, we find sufficient
facts in the record to conclude that the settlement in this case is fair, reasonable, and
adequate.

                         2. Analysis of the Van Horn Factors

       To determine whether the settlement is fair, reasonable, and adequate, we
analyze each of the four mandatory factors: (1) the merits of the plaintiff’s case
weighed against the terms of the settlement; (2) the defendant’s financial condition;
(3) the complexity and expense of further litigation; and (4) the amount of opposition
to the settlement. Van 
Horn, 840 F.2d at 607
. The first factor, “a balancing of the
strength of the plaintiff’s case against the terms of the settlement,” is “[t]he single
most important factor.” 
Id. i. Merits
of the Plaintiffs’ Case Weighed Against the Terms of the Settlement

     The first factor weighs in favor of approving the settlement because “the
outcome of the litigation would be far from certain” if the case had not settled, In re

                                          -11-
Wireless Tel. Fed. Cost Recovery Fees Litig., 
396 F.3d 922
, 933 (8th Cir. 2005)
(quotation omitted), whereas “the settlement provides substantial benefits to the
class,” Van 
Horn, 840 F.2d at 608
(quotation omitted). Lopez contends that the
merits of the plaintiffs’ case were strong because Blue Buffalo admitted that suppliers
sent mislabeled ingredients to manufacturing facilities that produced certain Blue
Buffalo products. However, this admission does not mean that plaintiffs had a strong
chance of prevailing on the merits. Blue Buffalo continued to deny knowledge and
liability, and it maintained nine affirmative defenses. Moreover, Blue Buffalo
admitted that the mislabeled ingredients affected only a portion of its products—not
all of them. As a result, it is possible that only a small fraction of the pet food
purchased by class members contained by-product meals, with no way to discover
which class members were affected. This possibility would have harmed class
members’ chances of prevailing on the merits. Cf. O’Neil v. Simplicity, Inc., 
574 F.3d 501
, 503 (8th Cir. 2009) (“It is not enough to [prove] that a product line contains a
defect or that a product is at risk for manufacturing this defect; rather, the plaintiffs
must [prove] that their [unit of] product actually exhibited the alleged defect.”).

       Furthermore, although the district court certified the class for purposes of
settlement, it is uncertain whether, if the case proceeded to trial, this multistate class
of consumers would have created “intractable management problems” requiring the
district court to decertify it. See Amchem Prods., Inc. v. Windsor, 
521 U.S. 591
, 620
(1997) (“Confronted with a request for settlement-only class certification, a district
court need not inquire whether the case, if tried, would present intractable
management problems . . . .”); In re Warfarin Sodium Antitrust Litig., 
391 F.3d 516
,
537 (3d Cir. 2004) (finding that “a multistate class of consumers and [third-party
payors]” created “a significant risk that such a class would create intractable
management problems if it were to become a litigation class and therefore be
decertified,” and that this risk weighed in favor of approving a settlement). In sum,
the outcome of the litigation was far from certain.



                                          -12-
       On the other side of the ledger, the settlement confers substantial and
immediate benefits on the class. Blue Buffalo paid $32,000,000 into the settlement
fund. After deducting attorneys’ fees and administrative costs, $22,600,000 is
available to pay class members. Unlike other consumer class action settlements, class
members will receive cash instead of coupons, which often are not worth their face
value to the recipients. See Redman v. RadioShack Corp., 
768 F.3d 622
, 630 (7th Cir.
2014) (“83,000 $10 coupons are not worth $830,000 to the recipients. Anyone who
buys an item at RadioShack that costs less than $10 will lose part of the value of the
coupon because he won’t be entitled to change. Anyone who stacks three coupons
to buy an item that costs $25 will lose $5.”).

       Lopez complains that the settlement provides a “modest recovery” compared
to class counsel’s estimate of $150,000,000 in potential compensatory damages that
the class could recover at trial, which class counsel included in their motion for final
approval of the settlement. However, Lopez ignores the fact that class counsel stated
that this estimate represented a “best-case scenario.” As explained above, there were
substantial risks as to whether class counsel could successfully certify and maintain
a class, let alone prevail at trial and recover the full measure of damages they sought.
Moreover, class counsel provided an economic analysis showing that $150,000,000
discounted to present value yielded a damages figure of $115,000,000 and that the
$32,000,000 settlement fund thus represented 27 percent of the present value of the
maximum possible full verdict at trial. As courts routinely recognize, “a settlement
is a product of compromise and the fact that a settlement provides only a portion of
the potential recovery does not make such settlement unfair, unreasonable or
inadequate.” In re BankAmerica Corp. Sec. Litig., 
210 F.R.D. 694
, 708 (E.D. Mo.
2002); see also City of Detroit v. Grinnell Corp., 
495 F.2d 448
, 455 n.2 (2d Cir.
1974) (“In fact there is no reason, at least in theory, why a satisfactory settlement
could not amount to a hundredth or even a thousandth part of a single percent of the
potential recovery.”), abrogated on other grounds by Goldberger v. Integrated Res.,
Inc., 
209 F.3d 43
, 49-50 (2d Cir. 2000). And this amount, representing 27 percent of

                                         -13-
the maximum recovery at trial, is a compromise well within the fair and reasonable
range. See, e.g., Wells Fargo & 
Co., 314 F.R.D. at 626-28
(approving $25,750,000
class action settlement when class counsel estimated that class members had incurred
actual damages of over $100,000,000), aff’d sub. nom. Huyer v. Njema, 
847 F.3d 934
,
939-40 (8th Cir. 2017).

       Moreover, because of the low claims rate, those class members who submitted
valid claims will receive more than 100 percent of the amount they claimed that they
spent on Blue Buffalo products during the relevant time period. This is certainly a
substantial benefit. See 
Njema, 847 F.3d at 939
(holding that district court did not err
in concluding that first factor weighed in favor of settlement where “every class
member who receives an award will receive at least $5 to compensate for an average
inspection fee cost of $15”). Although Lopez points out that the low claims rate also
means that only 3 percent of the class will receive this benefit, we note that a claim
rate as low as 3 percent is hardly unusual in consumer class actions and does not
suggest unfairness. See, e.g., Sullivan v. DB Invs., Inc., 
667 F.3d 273
, 329 n.60 (3d
Cir. 2011) (citing evidence suggesting that “consumer claim filing rates rarely exceed
seven percent, even with the most extensive notice campaigns”); Perez v. Asurion
Corp., 
501 F. Supp. 2d 1360
, 1377-78, 1384 (S.D. Fla. 2007) (approving settlement
where 118,663 out of approximately 10.3 million class members submitted claims,
for a claim rate of approximately 1.2 percent). Moreover, even if 97 percent of the
class did not exercise their right to share in the fund, their opportunity to do so was
a benefit to them. See Boeing Co. v. Van Gemert, 
444 U.S. 472
, 480 (1980) (“Their
right to share the harvest of the lawsuit upon proof of their identity, whether or not
they exercise it, is a benefit in the fund created by the efforts of the class
representatives and their counsel.”). Further, assuming that these class members
continue to purchase pet food, they will benefit from the additional injunctive relief
that the settlement provides. See Bezdek v. Vibram USA, Inc., 
809 F.3d 78
, 84 (1st
Cir. 2015) (“The district court did not abuse its discretion in concluding that



                                         -14-
injunctive relief against continuation of the allegedly false advertising was ‘a valuable
contribution to this settlement agreement.’”).

       Nevertheless, Lopez contends that informing class members that they “could
only recover $10 unless they could locate old pet food receipts . . . discouraged claims
to an unreasonable degree.” However, requiring proofs of purchase is a valid
technique for preventing fraudulent claims. See Mullins v. Direct Digital, LLC, 
795 F.3d 654
, 667 (7th Cir. 2015) (recognizing that courts may rely on “techniques
tailored by the parties” to mitigate the risk of “mistaken or fraudulent claims”).
Hence, settlements in false-advertising cases often provide enhanced recovery for
those with proofs of purchase. See, e.g., 
Bezdek, 809 F.3d at 81
, 83-84 (affirming
approval of settlement in which “[c]lass members seeking a refund for more than two
pairs of shoes would be required to submit a Claim Form plus proof of purchase”).
In fact, for many class members hoping to submit claims under option 2, locating
proofs of purchase would not have been an onerous burden: in the past three years,
70-75 percent of the products at issue were sold through retailers with loyalty
programs that maintain purchase records, and the settlement website provided
information on how to obtain these purchase records. And, contrary to Lopez’s
suggestion, class members were informed of the possibility of recovering more than
$10 even without submitting receipts, as the notices and settlement website explained
the possibility of a pro rata increase of the recovery amounts.

       In sum, the settlement provides substantial and immediate benefits to the class.
Thus, “[w]eighing the uncertainty of relief against the immediate benefit provided in
the settlement,” In re 
Wireless, 396 F.3d at 933
, we conclude that this factor weighs
in favor of approving the settlement.




                                          -15-
                        ii. Defendant’s Financial Condition

      As the district court noted, “[t]here is no evidence in the record calling Blue
Buffalo’s financial condition into question, and indeed, Blue Buffalo has already
deposited $32 million into the Settlement Fund.” As such, this factor is neutral. See
Marshall, 787 F.3d at 512
(finding this factor neutral where defendant was “in good
financial standing, which would permit it to adequately pay for its settlement
obligations or continue with a spirited defense in the litigation”).

                 iii. Complexity and Expense of Further Litigation

       “Class actions, in general, place an enormous burden of costs and expense upon
parties.” 
Id. (quotations and
alterations omitted). Here, “the application of numerous
states’ laws” made this a particularly complex case. See 
id. The fact
that Blue
Buffalo filed a third-party complaint against two suppliers further contributed to the
complexity. In addition, class counsel described the complexity and expense of
further litigation to the district court as follows:

      Blue Buffalo has alleged numerous legal and factual defenses that,
      absent settlement, will require full discovery, including numerous
      depositions, briefing, and additional pre-trial work. Class certification,
      expert discovery, and summary judgment motions are just a few of the
      matters that would ensue, in addition to a trial and possible appeals.
      Additional work may also include pre-trial motions, post-trial motions,
      and thousands more hours of attorney time.

Class counsel’s views are entitled to deference, especially since the district court
found that they have significant experience in class actions and complex litigation.
See DeBoer v. Mellon Mortg. Co., 
64 F.3d 1171
, 1178 (8th Cir. 1995). As such, this
factor weighs in favor of settlement approval.



                                        -16-
                     iv. Amount of Opposition to the Settlement

       As the district court noted, “[w]hile there have been objections, they are small
in number, which speaks well of class reaction to the Settlement.” Specifically, out
of a class of approximately 3.5 million households, with an estimated 87 percent
receiving notice, class members submitted 105,173 claims, whereas only fourteen
class members submitted timely objections. Moreover, none of the named plaintiffs
objected to the settlement. Thus, the amount of opposition is minuscule when
compared with other settlements that we have approved. See 
Marshall, 787 F.3d at 513
(“We have previously approved class-action settlements even when almost half
the class objected to it. We have approved a class-action settlement even when all
named plaintiffs opposed it.” (citations omitted)); 
DeBoer, 64 F.3d at 1174
, 1178
(holding that “[t]he fact that only a handful of class members objected to the
settlement similarly weighs in its favor” where five class members objected out of a
class of 300,000). As such, this factor likewise weighs in favor of approving the
settlement.

      To summarize, three factors weigh in favor of approval and one is neutral.
However, before concluding that the settlement is fair, reasonable, and adequate, we
address Nadola’s separate objection regarding state-law claims.

                                 3. State-Law Claims

       Nadola claims that the district court abused its discretion in approving the
settlement because the settlement’s allocation plan distributes the fund equally among
class members of all states, without accounting for the varying strengths of different
states’ unfair trade practice statutes. Essentially, she argues that residents of states
with strong consumer protection laws should receive greater benefits under the
settlement because they would have recovered more money than residents of states
with weaker consumer protection laws. For this reason, she contends that the terms

                                         -17-
of the settlement are inherently unfair. She also argues that the district court abused
its discretion by not considering any evidence regarding the valuation of claims under
the laws of different states before approving the settlement.

       As an initial matter, class counsel assert that Nadola lacks standing to make this
argument because she is not injured by the aspect of the settlement that she
challenges. Specifically, they contend that she has failed to show that her own state-
law claims would be stronger than the claims of other class members under other
states’ laws. Because “[f]ederal courts must address questions of standing before
addressing the merits of a case where standing is called into question,” Brown v.
Medtronic, Inc., 
628 F.3d 451
, 455 (8th Cir. 2010), we first address whether Nadola
has standing to maintain her claim.

      “To show standing under Article III of the U.S. Constitution, a plaintiff must
demonstrate (1) injury in fact, (2) a causal connection between that injury and the
challenged conduct, and (3) the likelihood that a favorable decision by the court will
redress the alleged injury.” Iowa League of Cities v. EPA, 
711 F.3d 844
, 869 (8th
Cir. 2013). “The standing Article III requires must be met by persons seeking
appellate review, just as it must be met by persons appearing in courts of first
instance.” Arizonans for Official English v. Arizona, 
520 U.S. 43
, 64 (1997).

       Nadola first responds that she has standing because of the Supreme Court’s
decision in Devlin v. Scardelletti, which stated that “[a]s a member of the . . . class,
petitioner has an interest in the settlement that creates a ‘case or controversy’
sufficient to satisfy the constitutional requirements of injury, causation, and
redressability.” 
536 U.S. 1
, 6-7 (2002) (citations omitted). However, we recently
rejected this argument in Huyer v. Van de Voorde, 
847 F.3d 983
(8th Cir. 2017).
There, we explained that “the Court expressly noted that the issue in Devlin did ‘not
implicate the jurisdiction of the courts under Article III of the Constitution.’” 
Id. at 986
(quoting 
Devlin, 536 U.S. at 6
). Thus, notwithstanding any dicta in Devlin, we

                                          -18-
held that a class member appealing a settlement “still must show that she satisfies the
standing requirements of Article III.” 
Id. We further
held that the class member in Van de Voorde, by objecting to the
adverse treatment of a subclass to which she did not belong, failed to show that she
suffered an injury in fact. 
Id. at 986
-87. In fact, because awarding more money to
that subclass would diminish her own subclass’s share of the fund, she “likely would
receive less money as a result of” the changes she sought. 
Id. at 987.
Thus, her lack
of standing was apparent.

       However, this case is quite different. Here, Nadola stated that she purchased
Blue Buffalo products in New Jersey, and she points out that New Jersey permits
treble damages in consumer protection actions. See N.J. Stat. Ann. § 56:8-19. In
addition, New Jersey is one of the eight states under whose consumer protection laws
plaintiffs sued, and thus Nadola would have been part of the New Jersey subclass in
addition to the nationwide class. Consequently, if the settlement agreement either
adjusted recovery to account for the relative strength of all fifty states’ consumer
protection laws or simply provided greater recovery for class members who were also
members of a subclass, Nadola presumably would receive more money. See Rougvie
v. Ascena Retail Grp., Inc., No. 15-724, 
2016 WL 4111320
, at *1, 4-5, n.5 (E.D. Pa.
July 29, 2016) (approving settlement agreement that grouped consumers from all fifty
states into three categories according to the type of recovery generally permitted
under the relevant state statutes, and noting that class members in “treble recovery
states” would receive more than class members in “single recovery states” or “limited
recovery states”); In re Ins. Brokerage Antitrust Litig., 
579 F.3d 241
, 272-73 (3d Cir.
2009) (approving settlement that designated greater percentage of settlement value
to members who purchased excess insurance policies than those who purchased only
non-excess policies). Thus, we are persuaded that Nadola has demonstrated (1) an
injury in fact (2) caused by the settlement’s failure to account for differences in state
law and (3) which we can redress through a favorable decision. See Iowa League of

                                          -19-

Cities, 711 F.3d at 869
. As such, unlike in Van de Voorde, Nadola has standing to
raise this issue on appeal.

       Nevertheless, we reject Nadola’s argument on the merits. None of the
decisions that she cites stand for the proposition that settlement agreements must
account for differences in state law—each one simply approved such an agreement
negotiated by the parties. E.g., Rougvie, 
2016 WL 4111320
, at *1, 4-5; In re New
Motor Vehicles Canadian Exp. Antitrust Litig., No. 1532, 
2011 WL 1398485
, at *1,
6 (D. Me. Apr. 13, 2011). Indeed, “[i]t is an inherent feature of the class-action
device that individual class members will often claim differing amounts of damages.”
Marshall, 787 F.3d at 520
(citation omitted). This does not mean that every
settlement agreement must account for such differences. Rather, “a class action
settlement necessarily reflects the parties’ pre-trial assessment as to the potential
recovery of the entire class, with all of its class members’ varying claims.” 
Id. Moreover, “there
is a well-established remedy that any class member may elect to
preserve what he believes to be a claim worth more than what he may receive under
the settlement—opt out.” 
Id. Thus, the
fact that the settlement agreement did not
account for differences in state laws does not render it unfair.

       Nor did the district court abuse its discretion by not considering evidence
regarding the valuation of claims under the laws of different states. Nadola objects
to the district court’s statement that “[t]he objections that raise individual state law
claims are not well taken as the Settlement is evaluated in its entirety, rather than on
a claim by claim basis.” But the district court was correct. Its “obligation was to
evaluate the plaintiffs’ case in its entirety rather than on a claim-by-claim basis.” 
Id. at 517
(quotations omitted). This case involved three federal claims in addition to the
state-law claims. Hence, the state-law claims were only a fraction of the overall case.
Moreover, the settlement provided all class members with the opportunity to receive
up to $2220 and afforded injunctive relief to all class members. It was not an abuse



                                          -20-
of discretion to find that a settlement providing such benefits was fair to all class
members, including those who may have had additional state-law claims.

        Therefore, in light of the above analysis, we conclude that the settlement was
fair, reasonable, and adequate, and we affirm the district court’s order approving the
settlement.

                                 B. Attorneys’ Fees

       “Decisions of the district court regarding attorney fees in a class action
settlement will generally be set aside only upon a showing that the action amounted
to an abuse of discretion.” Petrovic v. Amoco Oil Co., 
200 F.3d 1140
, 1156 (8th Cir.
1999). However, “[w]e review de novo [any] legal issues related to the award of
attorney’s fees and costs.” Sturgill v. United Parcel Service, Inc., 
512 F.3d 1024
,
1036 (8th Cir. 2008) (citation omitted).

                                 1. Reasonableness

       “Courts utilize two main approaches to analyzing a request for attorney fees.”
Johnston v. Comerica Mortg. Corp., 
83 F.3d 241
, 244 (8th Cir. 1996). “Under the
‘lodestar’ methodology, the hours expended by an attorney are multiplied by a
reasonable hourly rate of compensation so as to produce a fee amount which can be
adjusted, up or down, to reflect the individualized characteristics of a given action.”
Id. “Another method,
the ‘percentage of the benefit’ approach, permits an award of
fees that is equal to some fraction of the common fund that the attorneys were
successful in gathering during the course of the litigation.” 
Id. at 244-45.
“It is
within the discretion of the district court to choose which method to apply, as well as
to determine the resulting amount that constitutes a reasonable award of attorney’s
fees in a given case.” In re Life Time Fitness, Inc., Tel. Consumer Prot. Act (TCPA)
Litig., 
847 F.3d 619
, 622 (8th Cir. 2017) (quotations and citations omitted). To

                                         -21-
determine the reasonableness of a fee award under either approach, district courts
may consider relevant factors from the twelve factors listed in Johnson v. Georgia
Highway Express, 
488 F.2d 714
, 719-20 (5th Cir. 1974). See 
Buckley, 849 F.3d at 399
(approving district court’s reliance on Johnson factors when awarding fee based
on percentage-of-benefit method); Marez v. Saint-Gobain Containers, Inc., 
688 F.3d 958
, 966 & n.4 (8th Cir. 2012) (approving reliance on Johnson factors when using
lodestar method).

       Here, the district court applied the percentage-of-the-benefit approach and
awarded 25 percent of the $32,000,000 settlement fund, generating a fee award of
$8,000,000. Although not required to do so, the court verified the reasonableness of
its award by cross-checking it against the lodestar method. See 
Petrovic, 200 F.3d at 1157
(“[U]se of the ‘lodestar’ approach is sometimes warranted to double-check
the result of the ‘percentage of the [benefit]’ method.”). The court determined that
the fee award corresponded to a lodestar multiplier of 2.7, that the hours and rates
submitted by class counsel were reasonable, and that the multiplier was in line with
multipliers used in other cases. Thus, the court approved the fee award as reasonable.

       Lopez, McCoy, and Sibley argue that the district court abused its discretion
because this fee was excessive in light of the results obtained. First, Lopez argues
that counsel should not be rewarded with a fee that is nearly three times their lodestar
when only 3 percent of class members submitted claims. In support of this argument,
he cites two unpublished opinions in which district courts declined to award the
requested amount of attorneys’ fees because of a low claims rate. See Eastwood v.
S. Farm Bureau Cas. Ins. Co., No. 3:11-cv-03075, 
2014 WL 4987421
, at *6 (W.D.
Ark. Oct. 7, 2014); Simon v. Toshiba America, No. 07-06202, 
2010 WL 1757956
, at
*4 (N.D. Cal. Apr. 30, 2010). However, Lopez identifies no binding authority
requiring courts to do so. Moreover, in each case he cites, the defendant retained any
unclaimed benefits, reducing the total amount received by class members and
justifying a lower award. Eastwood, 
2014 WL 4987421
, at *6 (finding that total

                                         -22-
value of settlement did not include “upwards of $1,500,000.00 in the common fund
[that] will revert to Defendant at the end of the day”); Simon, 
2010 WL 1757956
, at
*1, *3 (recognizing “the difficulty of measuring the value of the settlement at issue
in this case . . . because the claims period is not yet complete” where the settlement
allowed class members to claim refunds from defendant but did not create a specified
common fund). Here, there was no reversion to Blue Buffalo. Rather, class members
who submitted claims received a pro rata increase. Thus, the low claims rate did not
reduce the total amount received by the class. Furthermore, as we previously
explained, a low claims rate is not unusual in a consumer class action such as this
one. As such, the district court did not abuse its discretion in declining to reduce the
fee award on this basis.

       Second, Lopez argues that the lodestar multiplier is not in line with comparable
cases. He points out that the case cited by the district court for the proposition that
the multiplier of 2.7 is “in line with multipliers used in other cases” involved a
securities class action. See In re Xcel Energy, Inc., Sec., Derivative & ERISA Litig.,
364 F. Supp. 2d 980
, 999 (D. Minn. 2005) (approving multiplier of 4.7 and citing
other securities class action cases approving multipliers ranging from 4.3 to 6.96).
Lopez argues that the district court should have compared this case to another
consumer class action involving pet food, In re Pet Food Products Liability
Litigation. See No. 07-2867, 
2008 WL 4937632
(D. N.J. Nov. 18, 2008), aff’d in
part, vacated in part on other grounds, remanded, 
629 F.3d 333
(3d Cir. 2010). He
points out that the multiplier in that case was less than 1.2. See 
id. at *23.
For this
reason, he argues that the district court should have reduced class counsel’s fees to
reflect a similar multiplier.

       However, the court in Pet Food Products never suggested that it was using a
multiplier of less than 1.2 because that was the appropriate range to use in consumer
class actions. Rather, the court awarded that fee simply because it was what class
counsel requested. 
Id. Moreover, under
the percentage-of-the-benefit approach, the

                                         -23-
fee represented 25 percent of the settlement fund, which is the same percentage as in
this case. 
Id. This percentage
is consistent with other fee awards that we have
approved in other class action cases that did not involve securities. See Caligiuri v.
Symantec Corp., 
855 F.3d 860
, 865-66 (8th Cir. 2017) (affirming fee award that
represented one-third of the total settlement fund in class action seeking to recover
cost of download insurance services); 
Buckley, 849 F.3d at 399
(approving the same
in class action seeking to recover cost of property inspection fees). Thus, we will not
require the district court to reduce the fee award on the basis that the multiplier was
not in line with comparable cases.

       Third, McCoy suggests that “careful scrutiny of the affidavits and billing
statements provided by class counsel could have yielded a significant fee reduction.”
However, despite the fact that class counsel submitted detailed information showing
the hourly rates for each attorney, how much time they expended, and which tasks
they worked on, McCoy fails to explain why this information did not support the fee
requested. The district court stated that it found that “the total time expended by
plaintiffs’ counsel was reasonable, particularly in light of the result achieved,” and
McCoy offers no reason for us to doubt the district court’s assessment.

        Fourth, McCoy and Sibley argue that the district court failed to adequately
discuss all of the Johnson factors and that these factors weigh against awarding the
requested fee. Indeed, the court did not discuss all twelve factors but rather stated
that it “reviewed all factors relevant to the award of an attorneys’ fee, including the
novelty and difficulty of questions presented, the contingent nature of the action and
the result obtained on behalf of the Class.” However, the district court was not
required to discuss all of the factors, since “rarely are all of the Johnson factors
applicable[,] [and] this is particularly so in a common fund situation.” See Uselton
v. Commercial Lovelace Motor Freight, Inc., 
9 F.3d 849
, 854 (10th Cir. 1993).




                                         -24-
        Moreover, the record supports the district court’s decision to award the
requested fee based on the relevant factors. Class counsel represented to the district
court that five factors were relevant: (1) the amount involved and the results obtained;
(2) whether the fee is fixed or contingent; (3) the novelty and difficulty of the
questions; (4) the experience, reputation, and ability of the attorneys; and (5) awards
in similar cases. See 
Johnson, 488 F.2d at 717-19
(listing factors). We have already
discussed the first, third, fourth, and fifth factors when explaining that the results
obtained were beneficial to the class, further litigation would be complex and
expensive, class counsel have significant experience in class actions and complex
litigation, and the award is in line with awards in similar cases. The remaining factor
also weighs in favor of awarding the requested fee because class counsel took this
case on a contingency basis. See 
Buckley, 849 F.3d at 399
. Therefore, the district
court did not abuse its discretion in concluding that the fee was reasonable after
reviewing all relevant factors.

                               2. Administrative Costs

       Lopez and Sibley argue that the district court should have calculated attorneys’
fees as a percentage of $30,600,000 rather than $32,000,000 because the $1,400,000
in administrative costs did not constitute a benefit to the class. As support, Lopez
cites the Seventh Circuit’s decision in Redman v. RadioShack Corp., which held that
“administrative costs should not have been included in calculating the division of the
spoils between class counsel and class members.” 
768 F.3d 622
, 630 (7th Cir. 2014).

       However, we recently rejected the Seventh Circuit’s approach and held that
“the rule in this circuit is that a district court may include fund administration costs
as part of the ‘benefit’ when calculating the percentage-of-the-benefit fee amount.”
Caligiuri, 855 F.3d at 865
. Thus, “[w]e review the district court’s decision for an
abuse of discretion, and we ask [only] whether the appellant has made a showing that
the administrative costs were unjustifiable.” 
Id. (quotation omitted).
                                         -25-
       Lopez and Sibley make no showing that the administrative costs were
unjustifiable. They do not, for instance, contend that the notice and administrative
costs themselves were “unjustifiably high,” see 
id., or “excessive,”
see Staton v.
Boeing Co., 
327 F.3d 938
, 975 (9th Cir. 2003). Instead, Lopez argues that the
administrative costs were unjustifiable only because the low claims rate revealed the
limited benefit of the notice campaign and because inclusion of the administrative
costs further contributed to an already-inflated fee. However, we have already
explained that the low claims rate was not unusual and that the amount of the fee was
not unreasonable. Therefore, we decline to hold that the district court abused its
discretion by including administrative costs in its calculation of attorneys’ fees.

                     3. Opportunity to Respond to Fee Motion

       Finally, Sibley argues that the district court violated Rule 23(h) by approving
attorneys’ fees without providing class members with an opportunity to respond to
class counsel’s fee motion. “Interpreting the Federal Rules of Civil Procedure
presents a question of law subject to de novo review.” Indiana Lumbermens Mut. Ins.
Co. v. Timberland Pallet & Lumber Co., Inc., 
195 F.3d 368
, 374 (8th Cir. 1999)
(citation and alteration omitted).

      Rule 23(h) states, in relevant part:

      (1) A claim for an award must be made by motion under Rule 54(d)(2),
      subject to the provisions of this subdivision (h), at a time the court sets.
      Notice of the motion must be served on all parties and, for motions by
      class counsel, directed to class members in a reasonable manner.

      (2) A class member, or a party from whom payment is sought, may
      object to the motion.




                                         -26-
Fed. R. Civ. P. 23(h). Sibley contends that the district court violated the Rule because
it did not provide class members with an opportunity to “object to the motion.” 
Id. 23(h)(2). This
is because the notice sent to class members provided that all
objections must be postmarked by April 14, 2016, whereas the deadline for class
counsel to file their fee motion was May 12, 2016, and in fact, class counsel did not
file their motion until that date.

        Indeed, several of our sister circuits have held that this practice violates Rule
23(h). For example, in In re Mercury Interactive Corp. Securities Litigation, the
Ninth Circuit held that “the district court abused its discretion when it erred as a
matter of law by misapplying Rule 23(h) in setting the objection deadline for class
members on a date before the deadline for lead counsel to file their fee motion.” 
618 F.3d 988
, 993 (9th Cir. 2010). The Ninth Circuit reasoned that “[t]he plain text of the
rule requires that any class member be allowed an opportunity to object to the fee
‘motion’ itself, not merely to the preliminary notice that such a motion will be filed.”
Id. at 993-94.
As a result of the district court’s action, the objectors “could make only
generalized arguments about the size of the total fee because they were only provided
with generalized information [in the preliminary notice].” 
Id. at 994.
This “denie[d]
the class an adequate opportunity to review and prepare objections to class counsel’s
completed fee motion.” 
Id. at 994-95.
The Seventh Circuit reached the same
conclusion in Redman. 
See 768 F.3d at 637-38
(“Class counsel did not file the
attorneys’ fee motion until after the deadline set by the court for objections to the
settlement had expired. That violated [Rule 23(h)].”). And the Third Circuit, in dicta,
has agreed with this interpretation. See In re Nat’l Football League Players
Concussion Injury Litig., 
821 F.3d 410
, 446 (3d Cir. 2016) (“We have little trouble
agreeing that Rule 23(h) is violated in those circumstances [present in Mercury and
Redman].”).

     Class counsel respond that “Rule 23 does not by its terms require that a fee
motion precede the objection deadline in class settlements.” Citing the advisory

                                          -27-
committee note to Rule 23(h)(1), they contend that they need only provide
“information about the motion” in the notice to class members, which they did when
disclosing in the notice of proposed settlement that they would seek a fee of “not
more than $8,000,000.” See Fed. R. Civ. P. 23(h)(1) advisory committee note (2003).
 They also cite an unpublished Second Circuit opinion for the proposition that “the
Second Circuit has rejected the per se ruling of Mercury and Redman.” There, the
court construed a class member’s objection as “as a challenge to the reasonableness
of the notice of class counsel’s fee motion” under Rule 23(h)(1). Cassese v. Williams,
503 Fed. App’x 55, 57 (2d Cir. 2012) (unpublished). As a result, the court concluded
that “notice of class counsel’s fee request was reasonable here under the
circumstances and sufficient to satisfy due process” because “objectors then had two
weeks [after the fee motion deadline] to crystallize their objections and request
further information before attending the fairness hearing.” 
Id. at 58.
       However, these arguments construing Rule 23(h)(1), which states that notice
must be “directed to class members in a reasonable manner,” have no bearing on the
interpretation of Rule 23(h)(2), which states that class members “may object to the
motion” and is the basis for the rule articulated in Mercury. 
See 618 F.3d at 993-94
.
Indeed, the advisory committee note to Rule 23(h)(2) states that “[i]n setting the date
objections are due, the court should provide sufficient time after the full fee motion
is on file to enable potential objectors to examine the motion.” Fed. R. Civ. P.
23(h)(2) advisory committee note (2003). Thus, we have little difficulty in
concluding that Mercury and Redman correctly interpreted Rule 23(h)(2).

       Here, the district court’s scheduling order likewise violated Rule 23(h)(2).
Although class members were informed by the notice of proposed settlement that
class counsel would request up to $8,000,000 in attorneys’ fees, they “could make
only generalized arguments about the size of the total fee” in their objections. See
Mercury, 618 F.3d at 994
. Indeed, class members “could not provide the court with
critiques of the specific work done by counsel when they were furnished with no

                                         -28-
information of what that work was, how much time it consumed, and whether and
how it contributed to the benefit of the class” until class counsel submitted their fee
motion. See 
id. at 994.
Because the deadline for submitting objections had passed
by the time class counsel submitted their fee motion, class members were denied an
“adequate opportunity to review and prepare objections to class counsel’s completed
fee motion.” See 
id. at 994-95.
We do not purport to decide how much time after the
fee motion deadline is sufficient to provide class members with an adequate
opportunity to object to the motion. We hold only that the district court erred by
setting the deadline for objections on a date before the deadline for class counsel to
file their fee motion.

       Nevertheless, “[a] reviewing court has the duty to determine whether errors
alleged are harmless.” Ark. Elec. Energy Consumers v. Middle S. Energy, Inc., 
772 F.2d 401
, 404 (8th Cir. 1985). Harmless errors are those that “do not affect the
substantial rights of the parties.” 28 U.S.C. § 2111; see also Fed. R. Civ. P. 61. An
error affects a party’s substantial rights when it is prejudicial, “which means that there
must be a reasonable probability that the error affected the outcome of the
[proceeding].” United States v. Marcus, 
560 U.S. 258
, 262 (2010).

      Neither Mercury nor Redman considered whether the Rule 23(h) violations at
issue were harmless. Here, however, we are convinced that the error is harmless
because there is no reasonable probability that it affected the outcome of the
proceeding. Rather, the district court would have awarded the same fee even if the
court had set the deadline for objections to be after the deadline for the fee motion.

      After all, the four objectors now have had an ample opportunity on appeal to
respond to the specific arguments contained within class counsel’s fee motion.
Despite raising a number of objections, none of their arguments are meritorious. As
explained previously, the objectors’ arguments do not convince us that the attorneys’
fees were unreasonable. Nor do we believe that any of their arguments would have

                                          -29-
persuaded the district court to award a lower fee. See In re Lawnmower Horsepower
Mktg. & Sales Practice Litig., No. 08-1999, 
2010 WL 4386552
, at *2 (E.D. Wis. Oct.
28, 2010) (holding that any Rule 23(h) error was harmless because there was no
“reasonable probability that the scheduling error resulted in the non-assertion of an
objection that would have been successful and would have resulted in class counsel
receiving less in fees and costs than [was] ultimately awarded”). The court awarded
the requested fee because it was in line with awards from other cases, the relevant
Johnson factors supported it, and the hourly rates and time expended by class counsel
were reasonable. None of the objectors’ arguments undermine these reasons or even
identify any reasonable basis for reducing the requested fee. Thus, even if class
members had an opportunity to object to the fee motion, there is no reasonable
probability that their objections would have resulted in the court awarding a lower
fee.

       Although we recognize that the district court in Mercury did award a lower fee
after the case was remanded, that award resulted from an agreement between the
parties whereby class counsel would request a lower fee and the two objectors would
agree not to object to the renewed fee motion. In re Mercury Interactive Corp. Sec.
Litig., No. 5:05-cv-03395, 
2011 WL 826797
, at *1 (N.D. Cal. Mar. 3, 2011)
(unpublished). However, class counsel in Mercury had good reason to negotiate.
Specifically, the Ninth Circuit had not addressed any arguments challenging the
reasonableness of the fee award before remanding based on the Rule 23(h) 
violation. 618 F.3d at 995
& n.3. Hence, it would have been reasonable for class counsel in
Mercury to fear having the objectors raise potentially meritorious objections before
the district court. Here, we have addressed all of the objections to the fee award and
explained that they lack merit. As such, we see no reason to believe that class
counsel would agree to request a lower fee on remand.




                                        -30-
       Thus, in light of the circumstances of this case, we conclude that the scheduling
error was harmless. Accordingly, we affirm the court’s order awarding attorneys’
fees and expenses.

                                III. CONCLUSION

       We find that the settlement agreement was fair, reasonable, and adequate, and
thus we affirm the district court’s order approving the settlement. Further, because
the court did not abuse its discretion in calculating attorneys’ fees and because the
Rule 23(h) violation was harmless, we affirm the court’s order awarding attorneys’
fees and expenses.
                        ______________________________




                                         -31-

Source:  CourtListener

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