CALIFORNIA CLASS ACTION LAW

Tag: Loan

Magistrate Judge Elizabeth LaPorte Grants Final Approval For Settlement With Attorneys Fees of 25% of the Common Fund and $5,000 Incentive Award

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Magistrate Judge Elizabeth D. LaPorte granted final approval for a class of individuals who obtained an Option ARM loan originated by U.S. Financial Funding, Inc. with certain characteristics.  Lymburner v. U.S. Financial Funding, Inc., No. C0800325, 2012 WL 398816 (N.D. Cal., Feb. 7, 2012) (slip op.).  The net settlement amount was approximately $93,750, and the court granted plaintiff’s motion for attorneys’ fees in the amount of $36,250.  Id.

Background

Plaintiff Dian C. Lymburner brought a putative class action against Defendant U.S. Financial Funding alleging claims for fraudulent omissions, breach of contract, and breach of the implied covenant of good faith and fair dealing.  Id.  Plaintiff filed a motion to certify the class, and on January 22, 2010, the Court granted that motion.  Id.  After extensive negotiation, the parties reached a settlement. Id. After notice was mailed, no class members filed an objection or exclusion request. Id.

Discussion

With respect to the total settlement amount, the court noted that “importantly, the Settlement Agreement is premised on Defendant’s limited asset.”  Id.  “Defendant has no other source of funding other than an eroding insurance policy, which was valued at $174,000, and which is now valued at $145,000, which is the total settlement amount.”  Id.  The Court approved the settlement amount, in addition to $36,250 in fees and expenses, which is 25% of the estimated value of the settlement.  Id.  At this amount, Plaintiff’s attorneys received less than their lodestar.  Id.

Judge and Attorneys

United States Magistrate Judge Elizabeth D. LaPorte.

Edward Young Lee, Lee & Fields, A.P.C., Christopher Peter Fields, Los Angeles, CA, Jeffrey K. Berns, Arbogast & Berns LLP, Tarzana, CA, Michael C. Eyerly, Patrick Deblase, Paul R. Kiesel, Kiesel Boucher & Larson LLP, Beverly Hills, CA, for Plaintiff.

Shahram Nassi, Roger Scott Raphael, Lewis Brisbois Bisgaard & Smith, San Francisco, CA, for Defendant.

By CHARLES JUNG

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Ninth Circuit Holds That “Crux of Complaint” Rule Allows Courts to Decide Arbitrability Even Where Plaintiff Fails to Raise Challenge to Arbitrability as a Distinct Claim in Complaint

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The Ninth Circuit Court of Appeals considered whether the “crux of the complaint” rule requires the question of arbitrability to be determined by the arbitrator when a plaintiff’s challenge to the arbitration clause does not appear in his complaint.  Bridge Fund Capital Corporation v. Fastbucks Franchise Corporation, No. 08-17071, 2010 WL 3584060 (9th Cir. Sept. 16, 2010).  The court held that “as long as the plaintiff’s challenge to the validity of an arbitration clause is a distinct question from the validity of the contract as a whole, the question of arbitrability is for the court to decide regardless of whether the specific challenge to the arbitration clause is raised as a distinct claim in the complaint.”  Id. *1. Read the rest of this entry »