Stroock Special Bulletin
"Class Action Settlements - Seventh Circuit Limits Injunctions of Competing State Actions and Ninth Circuit Clarifies Permissibility of Gift Cards and Incentive Awards"
In two recent decisions, the Seventh and Ninth Circuits address important issues surrounding class action settlements. Most significantly, in Adkins v. Nestle Purina PetCare Company (7th Cir. Mar. 2, 2015), authored by Judge Easterbrook, the Seventh Circuit curtailed the ability to enjoin competing state court actions pending final approval of federal class action settlements. In In re Online DVD-Rental Antitrust Litigation/Resnick v. Netflix, Inc. (9th Cir. Feb. 27, 2015), the Ninth Circuit confirmed that (1) gift card settlements are not necessarily coupon settlements subject to heightened scrutiny under the Class Action Fairness Act ("CAFA"), and (2) disparity between the amount of class representative incentive awards and individual recovery for class members is not inherently improper.