(1) APPROVING SETTLEMENT AGREEMENT;
(2) APPROVING DISBURSEMENTS PURSUANT TO SETTLEMENT AGREEMENT;
(3) APPROVING PAYMENT OF COST OF CLAIMS ADMINISTRATION AND CLASS NOTICE, LITIGATION COSTS, CASE CONTRIBUTION AWARD AND ATTORNEYS' FEES; AND
(4) ORDERING FINAL REPORT.
JAMES L. ROBART, District Judge.
On February 10, 2017, the Court preliminarily approved a proposed Settlement Agreement between plaintiff on behalf of the class and defendant United Healthcare Services, Inc. Dkt. No. 77. In conjunction with that Order, the Court directed that the Claims Processor mail the Class Notice (Dkt. No. 73-2) to the Class Notice Recipients and provide the Court with confirmation of compliance by March 22, 2017. See Dkt. No. 78 (confirming mailing of Class Notice). Class counsel also established a settlement webpage consistent with the Preliminary Approval Order, containing the Class Notice, the Claim Form Materials and key filings in the litigation, including the Motion for Attorneys' Fees, Litigation Costs and Incentive Awards. See
The Preliminary Approval Order also provided that class members who wished to comment on or object to the proposed Agreement to do so by April 21, 2017. Class members were informed of their rights and of this deadline in the notices that were mailed to them and on class counsel's website.
The Order further scheduled a final settlement hearing, which was held on June 2, 2017 at 9:00 a.m., to consider any objections and comments submitted by class members and to determine whether the proposed Agreement is fair, reasonable, adequate and should be approved by the Court.
1. The parties have reached a Settlement Agreement that confirms plan amendment to prospectively cover medically necessary mental health services without special treatment limitations imposed only on mental health services. The Agreement also established a process for re-processing of mental health claims denied or limited due to the application of the Challenged Mental Health Treatment limitations, the exact terms of which are set out in the Agreement.
2. The Agreement also establishes a settlement fund to pay all reprocessed claims. Under the terms of the Agreement, this fund will be used to pay for re-processed claims only.
3. Under the terms of the Settlement Agreement, the costs of claims administration, class notice, litigation costs, case contribution award and attorneys fees shall be paid from a payment of $110,000 from defendant UHC to class counsel.
4. The Court's Preliminary Approval Order required the Claim Processor to mail court-approved notice to class members by direct mail. The notices informed class members that they had an opportunity to object or submit comments to the Court regarding the proposed Agreement and that they must do so in writing by April 21, 2017.
5. Consistent with the Order, defendant provided notices and materials required under the Class Action Fairness Act ("CAFA"), 28 U.S.C. § 1715(b).
6. Class Notices were mailed to all identified settlement class members. No class members objected to the Settlement Agreement. No class members submitted comments.
7. Rule 23(e) provides that "a class action shall not be dismissed or compromised without the approval of the court. . . ." Compromise and arbitration of complex litigation is encourage and favored by public policy. See Simula, Inc. v. Autoliv, Inc., 175 F.3d 716, 719 (9th Cir. 1999).
8. A presumption of fairness and adequacy attaches to a class action settlement reached in arm's-length negotiations by experienced class counsel after meaningful discovery. See, e.g., Officers for Justice v. Civil Service Com., 688 F.2d 615, 625 (9th Cir. 1982); Pickett v. Holland Am. Line-Westours, Inc., 145 Wn.2d 178, 209, 35 P.3d 351 (2001).
9. The following factors are generally considered when determining whether a settlement is fair, adequate and reasonable: the likelihood of success by plaintiff; the amount of discovery or evidence; the settlement terms and conditions; recommendation and experience of counsel; future expense and likely duration of litigation; recommendation of neutral parties, if any; number of objectors and nature of objections; and the presence of good faith and absence of collusion. Officers for Justice, 688 F.2d at 625.
10. Based upon these factors, the Court finds that the Agreement is fair, reasonable, and in the best interests of the class. The requirement of CR 23 and due process have been satisfied.
11. Specifically, the Court concludes that the Agreement was the result of arm's-length bargaining. It was reached after sufficient discovery and motions practice. Although the plaintiff believed that she had a strong likelihood of success, defendant also believed that it would ultimately succeed, such that there was risk in proceeding with the litigation. A settlement that confirms coverage of medically necessary mental health services without special limitations and exclusions, and provides for full reimbursement (except for a $15 co-payment) for class members' past mental health therapy services, achieves the goals of the litigation. There is no evidence of collusion between the parties, and the agreement was reached in good faith.
12. The class was provided with adequate notice, and due process has been satisfied in connection with the distribution of the notice. As noted above, there were no objections or comments to the proposed Agreement.
IV. FUNDING OF QUALIFIED SETTLEMENT FUND
13. Upon the occurrence of the conditions set forth in section 2 of the Settlement Agreement, and after adequate funding of the Qualified Settlement Fund by defendant, the Court authorizes the Claims Processor to disburse all Reprocessed Claim Amounts to settlement class members from the Qualified Settlement Fund.
V. CLASS NOTICE, CLAIMS ADMINISTRATION, LITIGATION COSTS, INCENTIVE AWARDS AND ATTORNEYS' FEES
14. The Settlement Agreement provides, upon the occurrence of the conditions set forth in Section 2 of the Agreement, that class counsel shall make the following payments out of $110,000 to be paid by defendant UHC to class counsel: (1) payment for Class Notice and Claims Administration; (2) payment of all litigation costs; (3) payment of up to $5,000 for a case contribution award to plaintiff Carr, if approved by the Court, and (4) the remainder to be paid to class counsel, Sirianni Youtz Spoonemore Hamburger and Breskin, Johnson & Townsend, as payment for lodestar attorneys' fees. That request is reasonable and is granted. The Court awards $110,000 to be paid by UHC to class counsel within 30 days of the Effective Date of the Settlement Agreement. Class counsel shall then distribute the payments identified above.
15. No objections were received to the request for a payment of up to $110,000 in attorneys fees.
VI. CASE CONTRIBUTION AWARDS
16. Upon the occurrence of the conditions set forth in Section 2 of the Settlement Agreement, plaintiff Carr is awarded a case contribution award in the sum of $5,000 as described in the Settlement Agreement. The Court authorizes the disbursement of these funds from the $110,000 payment to class counsel.
17. No objections were received to the request for case contribution awards.
VII. CLASS COUNSEL'S FINAL REPORT
18. Class counsel shall submit a final report to the Court regarding claims processing and disbursement of funds by no later than 30 days after the Claims Processor processes all valid claims. The Report shall detail the payment of court-awarded attorneys' fees, costs, expenses, case contribution award, costs of notice/administration, payment of class member claims, and taxes, if any.
It is hereby ORDERED that:
1. The Settlement Agreement is approved as fair, reasonable and adequate under CR 23, and its terms shall bind class members, since no class member opted-out.
2. Class counsel is awarded $110,000 out of which it must pay for the costs of Class Notice and claims processing, litigation costs, the Court-approved case contribution award and, with the remainder, attorneys fees.
3. The Claims Processor is also authorized to distribute payments to class members and the named plaintiff in accordance with the Agreement and this Order. These amounts are authorized to be paid from the Settlement Trust Fund.
4. Case contribution award of $5,000 to plaintiff Alexandra Carr, as set forth in the Agreement, is approved. Class counsel is authorized to distribute that sum from the $110,000 payment to Class counsel, as described above and in the Settlement Agreement.
5. Class counsel is ordered to submit a Final Report in accordance with the Agreement and this Order, detailing all payments made by class counsel from the $110,000 payment and from the Qualified Settlement Fund.
6. The Court shall retain jurisdiction over this matter until the Qualified Settlement Fund is closed.
It is so ORDERED.