U.S. Ninth Circuit - The FindLaw 9th Circuit Court of Appeals Opinion Summaries Blog

Kozinski Crashes Nissan Leaf Settlement Party -- As a Plaintiff

Chief Judge Alex Kozinski, of the Ninth Circuit, bench-slaps lawyers and crashes class-action settlements on a semi-regular basis. This, however, was something different, as Kozinski's wrath wasn't felt from the bench -- he was an objecting plaintiff.

Nissan makes the Leaf, an all-electric car with an alleged 100-mile range. Unfortunately, the battery packs seem to either be partially defective, or simply have a shorter range than promised. Kozinski and his wife, Marcy Tiffany, purchased a 2011 Nissan Leaf, and the range wasn't even sufficient to make the 80-mile trek home, leaving them plugged in to a charger at a dealership fifteen miles short of their destination.

But Nissan has a solution, in the form of a settlement reached with the attorneys representing class of Leaf owners, Kozinski included: an extended warranty. Meanwhile, the named plaintiffs get $5,000 each and the lawyers get $1.9 million. What was Kozinski, the now-objecting plaintiff's response?

The response was thirty-pages of rage, though the ABA Journal notes that the objection was later amended and re-filed to "withdraw any suggestion that Plaintiffs' Counsel acted unethically in the conduct of this litigation."

If that sounds merciful, just wait. Here are a few highlights:

"Plaintiffs' Counsel negotiated a settlement in the case 'prior to production of any discovery' by Nissan ... That's right, Plaintiffs' Counsel sat down to the negotiating table and cut a deal, without knowing a single thing about what cards their opponents held."

"Objectors don't understand how competent lawyers can hope to negotiate a favorable settlement without first discovering what adverse information Nissan's management considered at the time they sold 18,000+ electric vehicles in the United States, and many more abroad."

Don't worry, there's more bench-slapping (it's still a bench-slapping when it comes from a judge, even if he's not wearing his robes):

"Plaintiffs' Counsel applaud themselves heartily for the brilliant settlement they supposedly extracted from Nissan, based entirely on the fact that Nissan strenuously denied any liability until it agreed to settle. But defendants always deny liability when faced with a meritorious lawsuit. Merck didn't roll over and play dead when it was first sued over the people it killed while raking in billions selling Vioxx."

And post-settlement "confirmatory discovery" did not satisfy Chief Kozinski:

"This is plainly inadequate. First, it came too late, as the settlement was already locked. Had Nissan produced post-settlement documents that disclosed a new basis for liability, there is no provision for adjusting the settlement upward. The discovery was designed only to confirm the existing settlement, not to improve on it."

"Second, this was hardly what one would call discovery: Nissan provided whatever it wanted, and Plaintiffs' Counsel passively reviewed it. ... This was one hand washing the other, not arm-wrestling."

"Finally, and perhaps most damning, by the time they were reviewing these documents, Plaintiffs' Counsel had locked plaintiffs into a settlement that guaranteed counsel a $1.9 million fee. At that point, Plaintiffs' Counsel no longer had an incentive to look for evidence establishing liability; their incentive was to get the settlement finalized so they could cash in their bounty."

Those are just some of the highlights of the thirty-page rant by Kozinski, which despite the amendment to remove allegations of unethical conduct, pretty much accuses the attorneys of shoving through a class-action settlement that provides little to no relief to the injured parties, yet nets the attorneys $1.9 million in fees.

Such an alleged caper may have made it by the lay-people, but unfortunately for the attorneys here, Chief Judge Kozinski is still fuming over his shoddy electric car battery.

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