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Michael Shames, et al v. the Hertz Corporation

October 15, 2012

MICHAEL SHAMES, ET AL.,
PLAINTIFFS,
v.
THE HERTZ CORPORATION, ET AL.,
DEFENDANTS.



The opinion of the court was delivered by: Hon. Michael M. Anello United States District Judge

ORDER DENYING EX PARTE MOTION FOR LEAVE TO FILE MOTION TO INTERVENE [Doc. No. 341]

Class settlement objector, Gordon Hansmeier, through his counsel, Brett Langdon Gibbs of Mill Valley, CA, filed an ex parte application for leave to file a motion to intervene to be heard on an expedited basis. [Doc. No. 341.] Objector wishes to intervene so that he may ultimately file a motion to remove certain class counsel, have his attorney appointed as co-lead class counsel, and for issuance of supplemental notice. The Court DENIES Objector's ex parte motion.

On May 22, 2012, the Court issued an Order preliminarily approving the class settlement, certifying a settlement class, appointing a class representative and class counsel, and providing for class notice. [Doc. No. 313.] In that Order, the Court appointed Kurtzman Carson Consultants as the class administrator and ordered that individual notice be sent to identified class members via electronic mail or standard mail no later than July 6, 2012. The Court further ordered notice by publication no later than July 27, 2012. [Id. ¶ 7(a)-(b).] As relevant to this Order, the Court also scheduled a final approval hearing for October 29, 2012, and set a deadline of October 1, 2012, for filing objections to the class settlement, attorneys' fees, or both. Shortly after the scheduled class notice dates, the Court slowly began receiving objections. [See Doc. No. 319 (Objection of Aaron H. Pratt, first objection received on July 23, 2012).]

I.BACKGROUND

Objector's local counsel, Brett Gibbs, made an appearance on Objector's behalf on October 1, 2012, the last day to file objections to the class settlement. [Doc. No. 330.] Objector filed his objection on the same day. [Doc. No. 331.] At 32 pages--by far the lengthiest objection filed--Objector's filing includes 4 exhibits, including two letters sent to class counsel by an associated Minnesota attorney named Paul R. Hansmeier. The first letter, dated Friday, September 28, 2012, is addressed to class counsel, Mr. Stewart. In addition to briefly voicing Objector's objections, attorney Hansmeier demanded $30,000 in exchange for his not filing lengthy objections to the class settlement and attorneys' fees request. [Doc. No. 331-4.] Objector's counsel ominously warned, in part:

This letter is to advise you that an objection will be filed to your proposed settlement. I am enclosing a draft of the objection to be filed, which you have previously had an opportunity to review. This (or a similar version) will be filed if you do not attempt to resolve this matter. We find that settlements like this are likely to be rejected following our participation, as was the result today in In re Groupon, No. 11-md- 02238 (S.D. Cal.) (Dkt. No. 97).

I will extend to you an offer to settle this matter with my client for $30,000.00 if the settlement terms are reached by 5:00 PM CST on Monday, Oct. 1, 2012. If you reject this settlement and the objection is filed, the offer to settle is revoked and will not be extended at the pre-filing settlement amount.

Govern yourself accordingly.

[Doc. No. 331-4.] On Monday, October 1, 2012, governing himself according to the undertone

and implications of Objector's counsel's letter, class counsel responded, in part:

In our view, if you present this objection, it is clear that it will have been presented for an "improper purpose" under Fed R. Civ. P. Rule 11(b)(1). Our view is further informed by the fact that the practice of contacting class counsel with draft objections and inviting them to "discuss them" (i.e. resolve them by making an unjustified payment to the objectors' lawyers) in advance of filing in the hope of gaining an unjustified payment beyond any legitimate class member's claim appears from the Record in Groupon to be a pattern of conduct.

Please be advised that we consider this conduct to be improper and sanctionable under 28 U.S.C.A. § 1927 and Rule 11.

[Doc. No. 331-3 at 3.] That same day, Objector's counsel took umbrage ...


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