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Walsh v. Globalstar

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION


May 17, 2010

EDWARD M. WALSH AND DAVID F. KESLER, PLAINTIFF,
v.
GLOBALSTAR, INC., DEFENDANT.

NOTICE OF PROPOSED CLASS ACTION SETTLEMENT AND FINAL FAIRNESS HEARING

TO: All persons who were subscribers to GLOBALSTAR, INC. satellite voice and data services in the United States and were not in default on their subscription payments at any time from January 1, 2006 to February 28, 2007 (the "Class").

PLEASE READ THIS NOTICE CAREFULLY. THIS IS NOT A NOTICE OF A LAWSUIT AGAINST YOU. YOU MAY BENEFIT FROM READING THIS NOTICE.

YOU NEED NOT RESPOND TO THIS NOTICE IN ORDER TO RECEIVE BENEFITS THAT MAY BE AVAILABLE UNDER THE SETTLEMENT.

IF YOU DO NOT WANT TO BE A PART OF THE SETTLEMENT, YOU MUST EXCLUDE

YOURSELF BY ___________, 2010.

* There is a proposed settlement of a class action lawsuit known as Walsh v. Globalstar, Inc., 07-CV-01941 TEH, that is pending in the U.S. District Court for the Northern District of California (the "Litigation"). The proposed Settlement is with Globalstar, Inc. ("Globalstar" or the "Defendant") concerning the provision of allegedly defective twoway voice and data communications services through Globalstar's satellite network.

* You may be included in this proposed Settlement if you subscribed to Globalstar's satellite voice and data services in the United States and were not in default on your subscription payments in the period beginning January 1, 2006 throughFebruary 28, 2007(the "Class Period"), subject to certain eligibility criteria described in this Notice.

* The Court presiding over this case still has to decide whether to give final approval to the proposed Settlement. Valid requests for relief under the terms of the Settlement Agreement will be honored if the proposed Settlement is approved.

1.WHY YOU RECEIVED THIS NOTICE:You received this Notice because: Globalstar's billing records show that you subscribed to Globalstar satellite phone service during the Class Period and were not in default on your subscription payments; or, you downloaded it through the Settlement website, www.satphonesettlement.com.

2.WHAT THIS LAWSUIT IS ABOUT:The lawsuit alleges that Globalstar sold satellite telephones and satellite communication services when it knew, but failed to disclose, that its service was deteriorating and would not work for communicating from locations where cellular or landline service is limited or unavailable.

Globalstar believes that it has always dealt with its customers fairly and openly, and certainly did not hide anything. It denies any wrongdoing and makes no admission of liability by agreeing to the proposed Settlement described in this Notice. Nonetheless, the Defendant has concluded that further conduct of the Litigation would be expensive, and that it is desirable that the Litigation be fully and finally settled in the manner and upon the terms and conditions described in this Notice.

3.WHY THIS IS ACLASS ACTION:In a class action, one or more people called "class representatives" sue on behalf of themselves and other people who have similar claims. The people together are a "class" or "class members." A court must determine if a lawsuit or a settlement should proceed as a class action. If it does proceed as a class action, there may be a trial. A trial then decides the lawsuit for everyone in the class. Sometimes, the parties may settle without a trial.

The parties have agreed to this proposed Settlement that includes Current Subscribers and Former Subscribers, subject to certain limitations described in this Notice. The Court has preliminarily approved this proposed Settlement and will hold a hearing to decide whether it should be finally approved. (See Section 10 below). United States District Judge Thelton E. Henderson is presiding over this class action. This proposed Settlement will not become effective unless it is finally approved.

4.CLASS COVERED BY THE PROPOSED SETTLEMENT:You are included in the Settlement if you were a subscriber to Globalstar satellite telephone services in the United States and were not in default on your subscription payments at any time during the Class Period. Excluded from the Class are subscribers to Globalstar satellite communication services outside the United States, the District of Columbia, and U.S. territories; Globalstar and employees of Globalstar, members of the immediate family (parents, spouses, siblings, and children) of employees of Globalstar, and any Globalstar subsidiary or Globalstar affiliate; government customers (i.e., any federal state, local, or municipal purchasers, or any others who purchase on behalf of government customers or pursuant to a government plan); resellers (i.e. purchasers of Globalstar goods and services that retain and bill clients directly); customers of resellers; and any person who participated in Globalstar's Canadian settlement reached in the Quebec Superior Court on June 25, 2008.

If you fall within the definition of the Class in the prior paragraph, you are a "Class Member" and there is nothing you need to do to remain a Class Member. You need not do anything to become part of the Class.

If you are a Class Member and do not exclude yourself from the Class (as explained below), you will become a "Settlement Class Member," and you will be bound by all proceedings, orders, and judgments entered in connection with the proposed Settlement, including the release and dismissal with prejudice described below.

The Court has appointed the following lawyer as Lead Counsel to represent the Settlement Class for purposes of the proposed Settlement:

Donna F. Solen

MASON LLP 1625 Massachusetts Avenue NW, Suite 605

Washington, DC 20036

5.PROPOSED SETTLEMENT BENEFITS: If you are a Settlement Class Member (that is, if you are a Class Member who does not exclude him or herself from the Settlement Class as described above) and the proposed Settlement is approved, you will be entitled to relief.

Notification of Eligibility for Settlement Benefits -- Second Notice Package: If the Court approves the Settlement, you will be sent a Post-Settlement Notice describing the form of relief available to you and how you may obtain that relief. Different forms of relief will be available for persons who were subscribers to Globalstar's satellite service at any time during the Class Period and are still subscribers ("Current Subscribers"), and persons who were subscribers at any time during the Class Period but were not current subscribers as of the date of the Fairness Hearing ("Former Subscribers"). (See Section 11 below).

Current Subscribers: If the Court approves the Settlement, Current Subscribers may choose from three forms of relief:

* Continued Service --If you are a Current Subscriber and continue to subscribe to a limited service plan, you will receive a credit of an additional one-hundred and fifty (150) anytime minutes usable for a period of twelve (12) months commencing on the date when both the Court has entered a Final Order and Judgment approving the Settlement and the time to review, appeal or alter that Final Order and Judgment has expired (the "Final Settlement Date"), provided your account is current and in good standing. If you continue to subscribe to an unlimited service plan, you will receive a fifty dollar ($50.00) credit to your Globalstar account to be posted twelve (12) months following the Final Settlement Date, provided your account is current and in good standing.

* Change in Service --If you are a Current Subscriber and choose to enroll in the Evolution Monthly Plan at $34.95 per month (unlimited home minutes and voicemail included), Globalstar willwaive the fifty dollar ($50.00) activation fee for changing service plans,continue to offer the terms of the Evolution Monthly Plan to you through January 31, 2011 and, make a fifty dollar ($50.00) credit to your Globalstar account twelve (12) months following the Final Settlement Date, provided your account is current and in good standing.

* Termination of Service -- If you are a Current Subscriber who wishes to cancel your plan, the Settlement allows you to do so without incurring termination fees and receive a proportionate refund of any unused amount in prepaid plans and a check for $75.00, provided that you return your Globalstar satellite telephone in working condition with the battery and the charger; if you return your Globalstar satellite telephone in working condition absent the battery and the charger, the Settlement provides that you will receive a check for $25.00.

Former Subscribers: If the Court approves the Settlement, Former Subscribers may choose from two forms of relief:

* Reactivation of Service - If you are a Former Subscriber who wishes to reactivate your Globalstar service with the purchase of a limited plan before January 31, 2011 and your account is current and in good standing, the Settlement provides: (a) a $400.00 voucher against the purchase of a new Globalstar satellite telephone model GSP-1700 (current retail price is $999.00) valid for any purchase prior to July 31, 2011 with the reactivation;

(b) a waiver of the $50 activation fee; and (c) a service credit of an additional 150 anytime minutes usable for 12 months after the Final Settlement Date. If you are a Former Subscriber who wishes to reactivate your Globalstar service with the purchase of an unlimited plan before January 31, 2011 and your account is current and in good standing, the Settlement provides: (a) a $400.00 voucher against the purchase of a new Globalstar satellite telephone model GSP-1700 (current retail price is $999.00) valid for any purchase prior July 31, 2011 with the reactivation; (b) a waiver of the $50 activation fee; and (c) a $50 credit to your account posted 12 months after the Final Settlement Date.

* Return of Equipment - If you are a Former Subscriber who wishes to return your Globalstar satellite telephone in working condition with the battery and the charger, the Settlement provides that you will receive a check for $75.00; if you return your Globalstar satellite telephone in working condition absent the battery and the charger, the Settlement provides that you will receive a check for $25.00.

No Cost to You:The cost of Settlement notice, administration costs, and attorneys' fees and expenses will be paid by Globalstar. These costs will in no way reduce the benefits available to Settlement Class members.

Relevant Information Regarding Globalstar's Satellite Network: Globalstar has entered into contracts for the construction of a second-generation of low-earth-orbit satellites, which it expects to improve the availability of two-way voice and data communication services and extend the life of its satellite network until at least 2025. Globalstar currently expects the first of four launches of six second-generation satellites each to take place in the late summer of 2010 and the fourth launch to be completed in the late spring or early summer of 2011. Circumstances presently unforeseen could delay the second-generation satellite launches. After its second-generation constellation becomes operational, Globalstar may increase prices, consistent with market conditions, to reflect improved two-way service and coverage. However, Globalstar may not be able to launch or operate all or some of its second-generation satellites successfully, impairing its ability to offer improved two-way voice and data communication services.

6.IF THE COURT APPROVES THE PROPOSED SETTLEMENT:If the Court approves the proposed Settlement, it will enter a Final Order and Judgment dismissing the lawsuit with prejudice, and releasing all related legal claims against the Defendant and parties related to it. This means that Settlement Class Members will be forever barred from bringing, continuing, or being part of any other lawsuit based on their dealings and relationship with Globalstar, and their subscription to Globalstar service, use of a Globalstar telephone or any of the allegations in the lawsuit. If you are a Class Member and do not want to be barred from bringing, continuing, or being part of such a lawsuit, you must exclude yourself from the Class and the proposed Settlement.

All Settlement Class Members will forever be barred from bring all claims (including "Unknown Claims" as defined herein), demands, rights, liabilities and causes of action of every nature and description whatsoever, known or unknown, suspected or unsuspected, asserted or that might have been asserted, by the Plaintiffs or any Settlement Class Member, against Globalstar arising out of or related to the Globalstar Satellite Service, Globalstar Satellite Telephones, any Service Agreement, any Service Plan, or any of the matters alleged in or in any way concerning, or that could have been alleged in, the Third Amended Complaint and the predecessor complaints ("Plaintiffs' Released Claims").

"Unknown Claims" means all claims, demands, rights, liabilities, and causes of action of every nature and description which any Plaintiff, or any Settlement Class Member, does not know or suspect to exist in his, her or its favor at the time of the Release which, if known by him, her, or it might affect his, her or its decision whether to object to this Settlement. With respect to any and all Plaintiffs' Released Claims, the Settling Parties stipulate and agree that, upon the Final Settlement Date, the Plaintiffs shall expressly waive, and each of the Settlement Class Members shall be deemed to have waived, and by operation of the Final Order and Judgment shall have waived, the provisions, rights and benefits of California Civil Code §1542, which provides: A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.The Plaintiffs shall expressly and each of the Settlement Class Members who has not timely excluded himself, herself or itself shall be deemed to have, and by operation of the Final Order and Judgment shall have, expressly waived any and all provisions, rights and benefits conferred by any law of any state or territory of the United States, or principle of common law, which is similar, comparable or equivalent to California Civil Code §1542.

7.ATTORNEYS'FEES AND REIMBURSEMENT OF EXPENSES: Since the Litigation began in April 2007, several law firms have devoted resources and expenditures in addressing the issues raised by the lawsuit purely on a contingent basis, and these law firms have received no compensation for their services or reimbursement of their expenses.

The Court has designated the law firms of Mason LLP, Ram & Olson LLP, and Audet & Partners, LLP as Co-Lead Class Counsel for purposes of the settlement of this Lawsuit. You will not be charged for the services of these or any other law firm representing the Class in this Lawsuit. You have the right to retain your own attorney in this matter, but if you do you will be responsible for paying your own attorneys' fees and expenses.

At the Fairness Hearing, Class Counsel will apply to the Court for an award of attorneys' fees and expenses ("Attorneys' Fees"). Class Counsel will submit an application to the court for a total fee award, including attorneys' fees, expenses, and incentive payments to the named Plaintiffs and all other costs, in a total amount not to exceed $900,000. If the Court approves Lead Counsel's application, Globalstar will pay the award. Payment of the award of Attorneys' Fees will not affect the benefits available to you.

The Attorneys' Fees, if approved by the Court, will be paid in at least two installments: (i) an initial payment of $650,000, to be made within ten (10) business days following the Final Fee Award Date; and (ii) one or more subsequent payments totaling $250,000, as long as each payment does not exceed fifty percent (50%) of the Globalstar's net income, if any, for the three (3) month period reported in Globalstar's previous quarterly filings. Thus, this second portion of the fee award is not guaranteed and is wholly dependent on the future success of Globalstar.

At the Fairness Hearing, the Plaintiffs will also apply to the Court for incentive awards for the named Plaintiffs not to exceed $5,000 to reimburse them for the risks they have assumed and the value of their time expended on this Lawsuit. If the Court approves Plaintiffs' application, Globalstar will pay the awards. Payment of incentive awards will be made out of the total Attorneys' Fees awarded. Payment of the Incentive Awards will not affect the benefits available to you.

8. PRELIMINARY INJUNCTION: The Court has preliminarily enjoined all Settlement Class Members who have not been excluded from the Class (and all persons acting on behalf of Settlement Class Members who have not been excluded from the Class) from (i) directly, representatively or in any other capacity filing, commencing, prosecuting, intervening in, or participating in and/or continuing to prosecute or participate in, or receiving any benefits or other relief from, directly or indirectly (as class members or otherwise), any action, lawsuit, claim or other proceeding, in any jurisdiction based on or relating to any of the claims and causes of action in this Lawsuit and/or the subject of the Settlement Class Members' Release, or the facts and circumstances relating thereto, and (ii) organizing Settlement Class Members who have not been excluded from the Class into a separate class for purposes of pursuing as a purported class action any lawsuit (including by seeking to amend a pending complaint to include class allegations, or seeking class certification in a pending action) based on or relating to the claims and causes of action in this Lawsuit and/or the subject of the Settlement Class Members' Release, or the facts and circumstances relating thereto.

At the Fairness Hearing, the Parties will ask the Court, as part of its final approval of the settlement, to enter a permanent injunction similar to the preliminary injunction described above.

9.EXCLUSIONS FROM THE CLASS: You may request to be excluded from the Settlement Class. If you submit a valid exclusion request on time, you cannot obtain relief under the proposed Settlement. You will not be bound by the Final Order and Judgment, and you will not be giving up any claims that you might have against Globalstar.

If you wish to exclude yourself from the Settlement, you must send a written request postmarked on or before _____________, 2010, to the Administrator, with copies to Lead Counsel and Globalstar's Counsel, at the following addresses:

Administrator Plaintiffs' Lead Counsel Globalstar's Counsel

c/o Rust Consulting, Inc. Donna F. Solen Jonathan A. Shapiro P.O. Box 24767 MASON LLP WILMER CUTLER PICKERING

West Palm Beach, FL 33416 1625 Massachusetts Ave NW, HALE AND DORR LLP

Suite 605 1117 S. California Avenue Washington, DC 20036 Palo Alto, CA 94304 To be valid, the exclusion request must:

* Contain your signature;

* State your name, current postal address, current telephone number, Globalstar account number; and

* State that you wish to be excluded from the Settlement in the lawsuit Walsh v. Globalstar, Inc., 07-CV-01941 TEH.

A request for exclusion will be invalid, and not accepted, if it does not provide all of the requested information, is postmarked after the deadline or is not sent to the correct address. A Class Member who makes an invalid request for exclusion will be treated as if he or she did not make any such request, and will be a Settlement Class Member bound by the Settlement.

In no event shall persons who purport to request exclusion from the Settlement Class as a group, aggregate, or class involving more that one Class Member be considered valid. Requests for exclusion that do not comply with any of the foregoing requirements will not be accepted.

If you do not properly exclude yourself by making a valid exclusion request as set forth above, all of your claims relating to the proposed Settlement will be released and you will be forever barred from bringing or becoming a part of a lawsuit about those claims. You will be barred even if you do not submit a claim under the proposed Settlement. In other words, if you do nothing at all, your claims will be released, and you will not receive any compensation under the Proposed Settlement.

If you do not want to resolve your claims through this proposed Settlement, you must request exclusion.

10.RIGHT TO COMMENT OR OBJECT: If you are a Class Member and do not exclude yourself, you may bring any comments on or objections to the proposed Settlement to the Court's attention. Objecting is not the same as excluding yourself. If you object and the proposed Settlement is approved, you will still be bound by the Final Order and Judgment and your claims will be released just like other Settlement Class Members.

To be valid, your written objection or comment must include:

* on the first page, prominent reference to Walsh v. Globalstar, Inc., 07-CV-01941 TEH.

* your full name, address and telephone number;

* a brief explanation of your comment or reason for objection;

* any papers or documents that you would like to submit to support your comment or objection; and

* whether you, or your lawyer, intend to appear at the Fairness Hearing described below.

An objection will be invalid if the submission does not provide all of the requested information, is received after the deadline stated above or is not sent to the correct address. An invalid submission will not be considered by the Court.

If you also wish to speak at the Fairness Hearing (described below), you must also state in your objection or comment that you intend to appear and speak at the hearing. If you do not include this statement, you will not be entitled to speak at the hearing.

You must deliver your objection to the Court by mailing it to the Clerk of the Court, with copies to the Administrator, Lead Counsel and Globalstar's Counsel. They must be received no later than _________, 2010. The mailing addresses for the Clerk of the Court, Lead Counsel, Defense Counsel and Administrator are as follows:

Clerk of Court Plaintiffs' Lead Counsel Globalstar's Counsel

Philip E. Burton Courthouse and Donna F. Solen Jonathan A. Shapiro Federal Building MASON LLP WILMER CUTLER PICKERING

450 Golden Gate Avenue 1625 Massachusetts Ave NW, HALE AND DORR LLP San Francisco, CA 94102 Suite 605 1117 S. California Avenue

Washington, DC 20036 Palo Alto, CA 94304

Administrator

c/o Rust Consulting, Inc.

P.O. Box 24767 West Palm Beach, FL 33416

11.FAIRNESS HEARING: On ___________, 2010 at ______ PT, a hearing will be held before Judge Thelton E. Henderson in Courtroom 12, 19th Floor, of the Philip E. Burton Courthouse and Federal Building, 450 Golden Gate Avenue, San Francisco, California, 94102. The purpose of the hearing is for the Court to decide whether the proposed Settlement is fair, reasonable and adequate and should be approved. The Court will also decide whether a final judgment should be entered dismissing this lawsuit, and the amount of attorneys' fees and reimbursement of expenses and incentive awards to the Settlement Class Representatives. This hearing may be postponed without further notice.

Your attendance is not required, even if you submitted a valid objection. If you or your personal attorney still want to attend the hearing, you are welcome to do so at your own expense. To speak at the hearing, you or your personal attorney must file with the Court a paper that is called a "Notice of Appearance." The Notice of Appearance must state: (1) the name and number of the lawsuit: Walsh v. Globalstar, Inc., 07-CV-01941 TEH; (2) that you wish to appear and speak at the Fairness Hearing; and (3) your name, address, telephone number and signature. Your Notice of Appearance mustbe postmarked on or before _______, 2010 and filed Clerk of Court at the address listed above.

12.ADDITIONAL INFORMATION:You may get more information at the Settlement website at www.satphonesettlement.com. You may also view the Settlement Agreement and related legal papers there.

You can also get more information by sending a written inquiry to Lead Counsel at its address listed above. In addition, you may look at and copy the legal documents filed with the Court at any time during regular office hours at the Office of the Clerk of Court at the address listed above. Otherwise,please do not contact the Court.

The Parties' and the Settlement Class Members' rights and obligations under the settlement, including the provision of settlement benefits to Class Members, will not become effective until final judicial approval, which means after the Court has entered a Final Order and Judgment and after exhaustion of all appeals, if any, that result in the affirmance of the Final Order and Judgment. However, Globalstar may elect to implement the Settlement after the Final Order and Judgment is entered and before the exhaustion of appeals if it so chooses.

Dated: __________, 2010 By Order of the United States District Court for the Northern District of California

20100517

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