You have navigated the treacherous waters of class action litigation and finally negotiated a settlement after years of hard labor. So now the parties just have to sign off on the agreement and get it before the presiding judge for approval, correct? Well, it’s not quite that simple most of the time. Due in large part to the magnitude of the settlement affecting absent class members, there are several mileposts to surmount to obtaining final approval of the settlement. Below are some procedures and issues for you to consider when tackling a class action settlement. Like other Class Actions 101 articles, this isn’t meant to be a detailed treatise of class action settlements; it is a basic blueprint of what a plaintiff’s counsel might expect to see at the time of settlement.

We have just negotiated a settlement with the defendants after years of litigation. Now what?

First you must file a motion for preliminary approval of the proposed class action settlement with the court. As suggested by the title of the motion, the court makes a preliminary determination on the fairness, reasonableness, and adequacy of the proposed settlement so that notice of the proposed settlement may be given to the class and a hearing may be scheduled to make a determination regarding the fairness of the proposed settlement. The preliminary motion generally lays out the road map for the settlement, including a definition of the settlement class, the notice and claims process, the release and waiver of claims that arise out of or could have been raised in the litigation, anticipated attorney fees and expenses, service or incentive awards for class representatives, and a brief description of the arm’s-length settlements. Courts tend to evaluate the merits of a proposed settlement to ensure it is the product of legitimate negotiations, fair to the entire class, and not deficient in any obvious manner before the time and expense of administration commences and a final approval hearing is scheduled. If a class has not already been certified (the parties can reach an agreement on a class-wide settlement before a class has been certified), the court may also conditionally certify a class for settlement purposes while holding off on final approval until the final approval hearing, where class members can voice any objections to the proposed settlement. The purpose of conditional certification is to permit the notice process to go forward, while recognizing that the certification is for settlement purposes only and that the class will not be certified if the settlement does not receive final approval. Be aware that some circuits do not approve the use of “conditional certification,” so be sure to examine relevant case law.

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