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Couser v. Comenity Bank

United States District Court, S.D. California

May 26, 2017

CARRIE COUSER, individually and on behalf of all others similarly situated, Plaintiff,
v.
COMENITY BANK, Defendant.

          ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S UNOPPOSED MOTION FOR CY PRES DISTRIBUTION [DOC. NO. 96]

          Hon. Michael M. Anello, United States District Judge

         On October 12, 2012, Plaintiff Carrie Couser filed this putative class action alleging violations of the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227 et seq. See Doc. No. 1. Plaintiff now moves the Court for approval of cy pres distribution of remaining settlement funds to certain beneficiaries. See Doc. No. 96. The Court found the matter suitable for determination on the papers and without oral argument pursuant to Civil Local Rule 7.1(d)(1). For the reasons set forth below, the Court GRANTS IN PART and DENIES IN PART Plaintiff's motion.

         Background

         This action is premised on allegations that Defendant contacted Plaintiff on her cellular telephone in an attempt to collect an alleged debt owed by Plaintiff's mother. Plaintiff alleges that Defendant used an automatic telephone dialing system to place multiple calls to her each day, and that she incurred charges for incoming calls. The Parties ultimately entered into a settlement agreement and on May 27, 2015, the Court granted final approval of the class action settlement (“the Settlement”). See Doc. No. 91. For the purposes of settlement, the Court certified the following Settlement Class:

All persons whose cellular telephone numbers were called by Defendant, released parties, or a third party dialing company on behalf of Defendant or the released parties, using an automatic telephone dialing system and/or an artificial or prerecorded voice, without consent, from August 1, 2010 through May 26, 2014, excluding those persons whose cellular telephone number/s were marked with a “wrong number” code in Defendant's database (which persons are included in the putative class in Picchi v. World Financial Network Bank, et al., Case No.:11-CV-61797, currently pending in the Southern District of Florida).
Excluded from the Class is Defendant, its parent companies, affiliates or subsidiaries, or any employees thereof, and any entities in which any of such companies has a controlling interest; the judge or magistrate judge to whom the Action is assigned; and, any member of those judges' staffs and immediate families, as well as persons who validly request exclusion from the Settlement Class.

See Doc. No. 91.

         Further, as part of the Settlement, Defendant was required to establish a non-reversionary Settlement Fund in the amount of $8, 475, 000.00. After costs and fees were distributed, the Net Settlement Amount was to be distributed pro rata to Class Members who had submitted valid and approved claims. Pursuant to the Settlement, the Claims Administrator was to mail Settlement Checks to those Class Members, and any funds not paid out as a result of un-cashed[1] Settlement Checks would be paid as cy pres awards to recipients to be agreed upon by the Parties, and upon Court approval. See Doc. No. 91.

         Now, Plaintiff moves for Court approval of cy pres distribution of the remaining balance of the Settlement Fund, which amounts to approximately $871, 549.69.[2] See Doc. No. 96. Specifically, Plaintiff requests that the balance be divided equally and distributed to: (1) New Media Rights; (2) Consumer Federation of California; (3) Public Justice Foundation; and (4) Bet Tzedek Legal Services. Defendant Comenity Bank does not oppose this motion.[3]

         Legal Standard

         “[T]he ‘cy pres doctrine allows a court to distribute unclaimed or non-distributable portions of a class action settlement fund to the ‘next best' class of beneficiaries.'” See Lane v. Facebook, Inc., 696 F.3d 811, 819 (9th Cir. 2012) (quoting Nachshin v. AOL, LLC, 663 F.3d 1034, 1036 (9th Cir. 2011)). “[A] district court should not approve a cy pres distribution unless it bears a substantial nexus to the interests of the class members, ” meaning that the distribution “must account for the nature of the plaintiffs' lawsuit, the objectives of the underlying statutes, and the interests of the silent class members.” Id. (citing Nachshin, 663 F.3d at 1036); see also Six (6) Mexican Workers v. Arizona Citrus Growers, 904 F.2d 1301, 1308 (9th Cir. 1990) (setting aside district court's cy pres application where distribution to the chosen recipient organization would have “benefit[ed] a group far too remote from the plaintiff class”).

         Discussion

         Here, “[t]he purpose of the TCPA is to ‘protect the privacy interests of residential telephone subscribers by placing restrictions on unsolicited, automated telephone calls to the home and to facilitate interstate commerce by restricting certain uses of facsimile machines and automatic dialers.'” Aboudi v. T-Mobile USA, Inc., No. 12CV2169 BTM NLS, 2015 WL 4923602, at *5 (S.D. Cal. Aug. 18, 2015) (quoting Satterfield v. Simon & Schuster, Inc., 569 F.3d 946, 954 (9th Cir. 2009)). In enacting the TCPA, Congress sought to protect people from unsolicited, automated phone calls because they cause a nuisance and constitute invasions of privacy. See Cabiness v. Educ. Fin. Sols., LLC, No. 16-CV-01109-JST, 2016 WL 5791411, at *6 (N.D. Cal. Sept. 1, 2016); Satterfield v. Simon & Schuster, Inc., 569 F.3d 946, 954 (9th Cir. 2009).

         Keeping in mind the foregoing, the Court discusses each of the proffered cy pres beneficiaries and their nexus to ...


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