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SPANN v. AOL TIME WARNER INC.

United States District Court, S.D. New York


June 7, 2005.

HENRY SPANN, et al., Plaintiffs,
v.
AOL TIME WARNER INC., et al., Defendants.

The opinion of the court was delivered by: DENISE COTE, District Judge

ORDER AND FINAL JUDGMENT

A hearing having been held on April 8, 2005 ("Hearing") to determine: (1) whether the terms and conditions of the parties' proposed settlement ("Settlement"), as set forth in the Stipulation and Agreement of Compromise and Settlement of Class Action, as amended ("Settlement Agreement"), are fair, reasonable, and adequate for the settlement of all claims asserted by the Class against the Defendants in this action, including the release of the Defendants and other Released Persons,*fn1 and should be approved; (2) whether judgment should be entered dismissing this action on the merits and with prejudice in favor of the Defendants and as against all Class Members; (3) whether to approve the provisions for payment to the Class Members, as provided in the Settlement Agreement, as a fair and reasonable method to allocate the Settlement Fund among the members of the Class; (4) whether and in what amount to award Class Counsel attorneys' fees and reimbursement of expenses from the Settlement Fund; and (5) whether and in what amount to award the Named Plaintiffs incentive awards from the Settlement Fund. Having considered all matters presented at the Hearing and otherwise, and it appearing that a Court-approved Class Notice or a Supplemental Class Notice, providing among other things notice of the Hearing or of a supplemental hearing to be held only in the event a recipient of a Supplemental Class Notice objected to the Settlement, was mailed to the last known address or, if such mailing was returned as undeliverable, to such other address as, by reasonable effort, the Settlement Administrator was able to determine, of the Class Members, consisting of each and every participant in one or more of the Defendant Plans whose pension benefit under one or more of the Plans was or will be calculated based upon one or more periods of Benefit Service that concluded during the Class Period, and each of the spouses, designated beneficiaries, executors, successors, alternative payees under a qualified domestic relations order, representatives or heirs of said participants, it is hereby

ORDERED that:

  1. This Court has jurisdiction over the subject matter of this action, the Plaintiffs, all Class Members, and the Defendants.

  2. The prerequisites for a class action under Rules 23(a) and (b)(1), Fed.R.Civ.P., have been satisfied in that: (a) the number of Class Members is so numerous that joinder of all Class Members in this action is impracticable; (b) there are questions of law and fact common to the Class; (c) the claims of the Named Plaintiffs are typical of the claims of the Class; (d) the Named Plaintiffs have fairly and adequately represented and will fairly and adequately represent the interests of the Class; and (e) the prosecution of separate actions by individual Class Members would create a risk of (i) inconsistent or varying adjudications with respect to individual Class Members which would establish incompatible standards of conduct for the Defendants, and/or (ii) adjudications with respect to individual Class Members which would as a practical matter be dispositive of the interests of the other Class Members.

  3. Pursuant to Rule 23 of the Federal Rules of Civil Procedure and for the purposes of the Settlement, this Court hereby finally certifies the following class:

Each and every participant in one or more of the Plans whose pension benefit under one or more of the Plans was or will be calculated based upon one or more periods of Benefit Service that concluded during the Class Period, and each of the spouses, designated beneficiaries, executors, successors, alternative payees under a qualified domestic relations order, representatives or heirs of said participants. The proposed settlement class is divided into two subclasses, each of which includes at least one hundred individuals.
Subclass One consists of those Class Members who received a lump-sum distribution of pension benefits from one or more of the Plans that was calculated based upon a period of Benefit Service that concluded during the Class Period. Named Plaintiffs Henry Spann and Carol Munley received their pension benefits as lump-sum distributions.
Subclass Two consists of those Class Members who (a) received or who are receiving a pension benefit in the form of an annuity from one or more Plans that was calculated based upon a period of Benefit Service that concluded during the Class Period; or (b) have a vested right to receive a pension benefit in the form of an annuity from one or more of the Plans at some date in the future that was calculated based upon a period of Benefit Service that concluded during the Class Period. Named plaintiff Catherine Chiapparoli receives her pension benefit monthly in the form of an annuity.
  4. The Court finally appoints Henry Spann and Carol Munley as Class representatives for Subclass One, and Catherine Chiapparoli as Class representative for Subclass Two.

  5. The Court finally appoints as Class Counsel Ronald Kravitz and Kim Zeldin of Liner Yankelevitz Sunshine & Regenstreif LLP and Allen C. Engerman of the Law Offices of Allen C. Engerman, PC. 6. As set forth in the Affidavit of Thomas V. Runco, a representative of the Settlement Administrator, The Garden City Group, Inc., sworn to March 23, 2005, the Class Notice, providing notice of the pendency of this action as a class action and of the proposed Settlement, was sent to all then-recognized Class Members who could be identified and located with reasonable effort. No Class Members objected to the Settlement prior to the April 8, 2005 Hearing. Having been advised that, shortly before that Hearing, the Settlement Administrator discovered that it had not sent the Class Notice to 35 newly-identified Class Members, the Court directed at the Hearing that the Settlement Administrator mail a Supplemental Class Notice to each of the 35 newly-identified Class Members. None of the newly-identified Class Members objected to the Settlement. Notice to Class Members, therefore, complied with the Procedural Order for Notice and Final Settlement Hearing. The form and method of notifying the Class of the pendency of the action as a class action and of the terms and conditions of the proposed Settlement met the requirements of Rule 23 of the Federal Rules of Civil Procedure, due process, and any other applicable law, constituted the best notice practicable under the circumstances, and constituted due and sufficient notice to all persons and entities entitled thereto.

  7. The Settlement is fair, reasonable and adequate and in the best interests of the Class, and therefore this Court approves the Settlement, adopts the terms of the Settlement, and directs the parties to consummate the Settlement in accordance with the terms and provisions of the Settlement Agreement.

  8. In consideration for the other terms of the Settlement Agreement, upon the Effective Date of the Settlement, the Releasors fully, completely and finally release, waive, settle, relinquish and discharge the Released Persons from the Released Claims. Named Plaintiffs and each Class Member provide this release individually and on behalf of the Releasors. Upon the Effective Date, Named Plaintiffs and each and every Class Member shall be bound by the Settlement Agreement, shall have exclusive recourse to the benefits, rights, and remedies provided by the Settlement Agreement regarding the Released Claims and shall be barred and precluded from pursuing any other action, demand, suit or claim, in any judicial, administrative or other forum whatsoever, against the Released Persons with respect to the Released Claims. Upon the Effective Date, Named Plaintiffs and each and every Class Member shall be (a) conclusively deemed to have covenanted not to sue the Released Persons in any action alleging Released Claims, and (b) forever enjoined and barred from continuing to assert or asserting the Released Claims against any of the Released Persons in any action. The release set forth in the Settlement Agreement will be a "general release" with respect to the Released Claims as that term is used in Section 1542 of the Civil Code of the State of California, and all Class Members will expressly waive any and all rights under that statute or similar statutes of any other jurisdiction.

  9. Pursuant to this Order and Final Judgment, the Settlement Agreement (including all of its terms and provisions), the negotiations or proceedings relating thereto, and the documents and statements referred to therein:

a. shall not be offered or received against the Defendants as evidence of or construed as or deemed to be evidence of any presumption, concession, or admission by any of the Defendants with respect to (i) the truth of any fact alleged by the Plaintiffs in this action; (ii) the validity of any claim that was or could have been asserted in this action or in any other litigation or proceeding; (iii) the deficiency of any defense that was or could have been asserted in this action, or in any other litigation or proceeding; or (iv) any liability, negligence, fault, or wrongdoing of the Defendants;
b. shall not be offered or received against the Defendants as evidence of a presumption, concession or admission of any error, fault, improper conduct or breach of any duty with respect to the Plans, or the sponsorship or administration thereof, by any Defendant, or against the Named Plaintiffs and the Class as evidence of any infirmity in the claims of Named Plaintiffs and the Class;
c. shall not be offered or received against the Defendants or against the Named Plaintiffs or the Class as evidence of a presumption, concession or admission with respect to any liability, negligence, fault or wrongdoing, or in any way referred to for any other reason as against any of the Parties to the Settlement Agreement in any other civil, criminal, administrative or other proceeding, other than such proceedings as may be necessary to effectuate or enforce the provisions of the Settlement Agreement, provided, however, that following the approval of the Settlement by the Court, Defendants may refer to the Settlement Agreement to effectuate or enforce the releases or any other rights, terms or provisions set forth therein, and to that end may use the Settlement Agreement or this Order and Final Judgment in any action or other proceeding to support a defense, claim, counter-claim or cross-claim based on principles of res judicata, collateral estoppel, release, good faith settlement, judgment bar or reduction or any other theory of claim preclusion or similar claim, defense, counter-claim or cross-claim;
d. shall not be construed against the Defendants or the Named Plaintiffs or the Class as an admission, concession or presumption that the consideration to be given thereunder represents the amount which could be or would have been recovered after trial; and
e. shall not be construed as or received in evidence as an admission, concession or presumption against Named Plaintiffs or the Class or any of them that any of their claims are without merit or that damages recoverable in this action would not have exceeded the Settlement Fund.
  10. The provisions for Payment to Class Members are approved as fair and reasonable, and the Settlement Administrator is directed to administer the Settlement Agreement in accordance with its terms and provisions.

  11. The Named Plaintiffs, the Class and all other Releasors are permanently barred and enjoined from commencing or prosecuting, either directly or indirectly, any of the Released Claims in this or any other forum against any or all of the Released Persons.

  12. This action is dismissed against Defendants with prejudice and without costs except as provided for in this Order and Final Judgment. 13. This Order and Final Judgment, the Settlement Agreement, and any of their terms, and all negotiations, discussions and proceedings in connection with this Order and Final Judgment and the Settlement, shall not constitute any evidence, or an admission by any of the Defendants or the other Released Persons, that any acts of wrongdoing have been committed and shall not be deemed to create any inference that there is any liability on the part of any of the Defendants or the other Released Persons.

  14. This Order and Final Judgment, the Settlement Agreement, and any of their terms, and all negotiations, discussions and proceedings in connection with this Order and Final Judgment and the Settlement, shall not be offered or received in evidence or used for any other purpose in this or any other proceeding in any court, administrative agency, arbitration forum, or other tribunal in the United States or any other country except as necessary to enforce the terms of the Order and Final Judgment or the Settlement Agreement.

  15. In the event that the Settlement fails to become effective in accordance with its terms, or if this Order and Final Judgment is reversed, vacated, or materially modified on appeal (and, in the event of material modification, if any Party elects to terminate the Settlement), this Order and Final Judgment (except this Paragraph), shall be null and void, the Settlement (except Paragraph 12 of the Settlement Agreement) shall be deemed terminated, and the Parties shall return to their pre-settlement positions as provided for in the Settlement Agreement.

  16. Class Counsel are hereby awarded the sum of $966,666.66 in fees, which the Court finds to be fair and reasonable, and $178,420.06 in reimbursement of expenses, which amounts shall be paid to Class Counsel from the Settlement Fund pursuant to the terms of the Settlement Agreement. The Court finds that the following factors support the fee award requested: (a) the time and labor expended by Class Counsel; (b) the magnitude and complexities of this Litigation and the risks attendant to this Litigation; (c) the quality of representation by Class Counsel, which obtained for the Class an estimated Settlement of $2.9 million, including an allowance of up to $300,000 for payment of administrative expenses; (d) the requested fee; and (e) public policy considerations, which favor encouraging attorneys to represent on a contingent basis parties who would otherwise likely be without a remedy, and which favor avoiding the inconvenience of continued litigation and trial for the parties, the Court, and other litigants waiting their turn to have matters adjudicated.

  17. In accordance with the terms of the Settlement Agreement, such fees and expenses shall be paid within three (3) business days after the Settlement Fund is created pursuant to the Settlement Agreement.

  18. The applications of Plaintiffs Spann, Munley and Chiapparoli for incentive awards are hereby GRANTED and awarded in the amount of $10,000 each, to be paid from the Settlement Fund. In accordance with the Settlement Agreement, such incentive awards shall be paid within three (3) business days after the Settlement Fund is created pursuant to the Settlement Agreement.

  19. Exclusive jurisdiction is hereby retained over the Parties and the Class Members for all matters relating to this action, including the administration, interpretation, effectuation or enforcement of the Settlement Agreement and this Order and Final Judgment. 20. Without further order of the Court, the Parties may agree to reasonable extensions of time to carry out any of the provisions of the Settlement Agreement.

  21. Upon completion of the implementation of the Settlement Agreement, the Settlement Administrator shall file a declaration with the Court stating that the Settlement Agreement terms have been completely implemented.

  SO ORDERED.


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