updated 02:49 am EDT, Thu May 1, 2014
Says fee paid to original attorney claimants too high, judge made appeal too difficult
A settlement agreed to by Apple and a pair of legal firms over early Magsafe adapters and their tendency to fray has been kicked back to a federal district court for reconsideration by the Ninth Circuit US Court of Appeals over concerns that the original judge had failed to properly safeguard the deal from "self-dealing" between the class counsel and Apple. The court also found fault with Judge James Ware's high barrier to appeal of the decision, requiring a $75,000 bond from objectors.
In a unanimous ruling, the court agreed with objector Theodore Frank of the Center for Class Action Fairness that Ware -- who is now retired, so another judge will reconsider the award -- "rubber-stamped" a deal that "structured to obscure actual relief" through Apple's agreement in advance to pay the suing legal firms up to $3 million of the award in attorney's fees and $100,000 in expenses, which the court said "cannot relieve the district court of its duty to assess fully the reasonableness of the fee request."
The case originated when a San Diego-based and a Washington DC-based pair of law firms sued Apple in 2009 over the Magsafe connectors and their tendecy to fray at specific points (a quality issued also experienced by members of the MacNN staff during and after the original lawsuit period). The company acknowledged the issue, and agreed to extend an existing replacement program and refund buyers who had already paid for a replacement adapter.
Judge Ware conducted the original fairness hearing before the claims period closed, making it impossible for the Appeals Court panel to determine how many claims had been filed or paid out. It said that the District Court reconsidering the case "may find it useful to elicit this information so that it can compare the amount recovered by the class with the amount claimed by class counsel." It also found that the appellate bonds -- $15,000 from each objecting party -- was onerous and designed to discourage an appeal of the arrangement, as such costs are usually only a few hundred dollars.
The court seemed to be sure, possibly due to the lack of accounting on claims paid and filings, that the deal was settled to the attorneys' benefit more than those affected by the issue. "We do not intend to direct the district court toward a particular result," the court stated in its opinion. "We request only that the court demonstrate that it was 'particularly vigilant' in monitoring for self-dealing and implicit collusion."