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EDWARD A. WALLACE (pro hac vice) AMY E. KELLER (pro hac vice) DAWN M. GOULET (pro hac vice) WEXLER WALLACE LLP [email protected] [email protected] [email protected] 55 West Monroe Street, Suite 3300 Chicago, Illinois 60603 Telephone: (312) 346-2222 Facsimile: (312) 346-0022 (Additional Counsel Appear on Signature Page)

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA – WESTERN DIVISION

SHAWN ROBERTS, et al.;

Plaintiffs,

vs.

ELECTROLUX HOME PRODUCTS, INC.,

Defendants.

Master File No. SACV12-1644-CAS(VBKx) CLASS ACTION PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL APPROVAL OF CLASS SETTLEMENT AND APPROVAL OF NOTICE TO SETTLEMENT CLASS

Action Filed: September 27, 2012

The Honorable Christina A. Snyder Date: August 18, 2014 Time: 10:00 a.m. Courtroom: 5— 2nd Floor

This Document Relates To: All Actions.

Case 8:12-cv-01644-CAS-VBK Document 158 Filed 08/08/14 Page 1 of 44 Page ID #:3302

mailto:[email protected]:[email protected]:[email protected]

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i

PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL APPROVAL OF CLASS SETTLEMENT

MASTER FILE NO. SACV12-1644-CAS(VBKx)

TABLE OF CONTENTS

I. INTRODUCTION ....................................................................................... 1

II. LITIGATION HISTORY ............................................................................ 5

III. SUMMARY OF THE SETTLEMENT AGREEMENT ............................... 6 A. Settlement Negotiations and Mediation.................................................. 6 B. The Settlement Provides Exceptional Benefits for Class Members ........ 8

1. Monetary Benefits ........................................................................... 8 2. Safety-Related Dryer Service Program ............................................ 9 3. Injunctive Relief .............................................................................10 4. Additional Benefits .........................................................................11

IV. FINAL APPROVAL OF THE SETTLEMENT IS WARRANTED ............12 A. The Strength of Plaintiffs’ Case Favors Approval of the

Settlement. ............................................................................................13 B. This Case Involved Significant Risk, Complexity, and Demanded

Significant Investments of Time and Resources by the Parties and the Court ...............................................................................................15

C. The Settlement Provides Substantial Relief for the Class ......................16 D. This Settlement Comes at the Completion of Discovery .......................17 E. Class Counsel Believes This Settlement Is in the Best Interest of

the Class ...............................................................................................18 F. The Settlement Is The Product Of Hard-Fought, Arm’s-Length

Negotiations ..........................................................................................19 G. The Notice Requirements of the Class Action Fairness Act Are

Satisfied ................................................................................................20 H. The Reaction of the Class Has Been Overwhelmingly Positive.............21

V. THE COURT SHOULD OVERRULE THE OBJECTIONS.......................22

VI. THE CLASS SHOULD BE CERTIFIED FOR SETTLEMENT PURPOSES ................................................................................................24 A. Rule 23(a) Requirements ......................................................................26

1. The Numerosity Requirement is Satisfied for Final Approval .........27 2. The Commonality Requirement is Satisfied for Final Approval ......27


ii PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL

APPROVAL OF CLASS SETTLEMENT MASTER FILE NO. SACV12-1644-CAS(VBKx)

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3. The Typicality Requirement is Satisfied for Final Approval ........... 29 4. Adequacy of Representation ........................................................... 30

B. Rule 23(b)(3) ........................................................................................ 31 1. Predominance is satisfied. ............................................................... 32 2. Superiority is also satisfied. ............................................................ 34

VII. CONCLUSION .......................................................................................... 35


iii PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL


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TABLE OF AUTHORITIES

Cases

Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997) ........................................................................ 24, 32, 34

Brown v. Ticor Title Ins., 982 F.2d 386 (9th Cir. 1992) ....................................................................... 30

Churchill Vill., L.L.C. v. GE, 361 F.3d 566 (9th Cir. 2003) ....................................................................... 22

Churchill Village, LLC v. Gen. Elec., 361 F.3d 566 (9th Cir. 2004) ....................................................................... 12

Class Plaintiffs v. Seattle, 955 F.2d 1268 (9th Cir. 1992) ..................................................................... 12

Dennis v. Kellogg Co., No. 09-cv-1786-L (WMc), 2013 U.S. Dist. LEXIS 163118 (S.D. Cal. Nov. 14, 2013) ........................................................................... 24

EEOC v. Kovacevich “5” Farms, No. CV-F-06-165 OWW/TAG, 2007 U.S. Dist. LEXIS 32330 (E.D. Cal. April 18, 2007) ........................................................................... 27

Eisen v. Porsche Cars N. Am., Inc., 2014 U.S. Dist. LEXIS 14301 (C.D. Cal. Jan. 30, 2014) ............................. 16

Ellis v. Costco Wholesale Corp., 657 F.3d 970 (9th Cir. 2011) ....................................................................... 29

Fulford v. Logitech, Inc., No. 08-cv-02041 MMC, 2010 U.S. Dist. LEXIS 29042 (N.D. Cal. Mar. 5, 2010) ............................................................................. 22

Gotthelf v. Toyota Motor Sales, U.S.A., Inc., 525 Fed. Appx. 94 (3d Cir. N.J. 2013) ........................................................ 33

Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) .............................................................. passim

Harris v. Palm Springs Alpine Estates, Inc., 329 F.2d 909 (9th Cir. 1964) ....................................................................... 27


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In re AIG, Inc. Sec. Litig., 689 F.3d 229 (2d Cir. 2012) .................................................................. 24, 32

In re Am. Int’l Grp., Inc. Sec. Litig. No. 04-cv-08141-DAB, DE # 663, 664 (S.D.N.Y. Oct. 1, 2012) ................. 24

In re AT&T Mobility Wireless Data Servs. Sales Tax Litig., 789 F. Supp. 2d 935 (N.D. Ill. 2011) ........................................................... 33

In re FEMA Trailer Formaldehyde Prod. Liab. Litig., 2012 U.S. Dist. LEXIS 146679 (E.D. La. Sept. 27, 2012) ........................... 34

In re Heartland Payment Sys., Inc. Customer Data Sec. Breach Litig., 851 F. Supp. 2d 1040 (S.D. Tex. 2012) ...................................................... 33

In re Ky. Grilled Chicken Coupon Mktg. & Sales Prac. Litig., 2011 U.S. Dist. LEXIS 157910 (N.D. Ill. Nov. 30, 2011) ........................... 33

In re NVIDIA Corp. Derivative Litig., No. C-06-061100-SBA (JCS), 2009 U.S. Dist. LEXIS 24973 (N.D. Cal. Mar. 18, 2009) ........................................................................... 13

In re NVIDIA GPU Litig., 539 F. App’x 822 (9th Cir. 2013) ................................................................ 32

In re Oil Spill by Oil Rig Deepwater Horizon in Gulf of Mex., on April 20, 2010, 910 F. Supp. 2d 891 (E.D. La. 2012)........................................................... 33

In re Omnivision Techs., 559 F. Supp. 2d 1036 (N.D. Cal. 2007) ....................................................... 21

In re TD Ameritrade Account Holder Litig., No. C 07-2852 SBA, 2011 U.S. Dist. LEXIS 103222 (N.D. Cal. Sept. 13, 2011) ..................................................................... 13, 19

In re Telectronics Pacing Sys., Inc., 137 F. Supp. 2d 985 (S.D. Ohio 2001) ........................................................ 23

In re Wal-Mart Wage and Hour Employment Practices Litig., MDL No. 1735, 2010 U.S. Dist. LEXIS 21466 (D. Nev. Mar. 8, 2010) ...... 24

In re Warfarin Sodium Antitrust Litig., 391 F.3d 516 (3d Cir. 2004) ........................................................................ 33

Jordan v. County of Los Angeles, 669 F.2d 1311 (9th Cir. 1982) ..................................................................... 27


v PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL


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Keegan v. Am. Honda Motor Co., 284 F.R.D. 504 (C.D. Cal. 2012) ............................................................... 32

Kent v. Hewlett-Packard Co., No. 5:09-cv-05341-JF (HRL), 2011 U.S. Dist. LEXIS 106825 (N.D. Cal. Sept. 20, 2011) ........................................................................... 13

Laguna v. Coverall of N. Am., Inc., No. 12-55479, 2014 U.S. App. LEXIS 10259 (9th Cir. June 12, 2014) ....... 21

Lane v. Facebook, Inc., No. C 08-3845 RS, 2010 U.S. Dist. LEXIS 24762 (N.D. Cal. Mar. 17, 2010) ............................................................................................ 14

Linney v. Cellular Alaska P’ship, 151 F.3d 1234 (9th Cir. 1998) ............................................................... 16, 18

Local Joint Executive Bd. Of Culinary/Bartender Trust Fund v. Las Vegas Sands, 244 F.3d 1152 (9th Cir. 2001) ..................................................................... 32

Mazza v. American Honda Motor Co., 666 F.3d 581 (9th Cir. 2012) ....................................................................... 15

Mego Fin. Corp. Sec. Litig., 213 F.3d 454 (9th Cir. 2000) ....................................................................... 13

Morales v. Stevco, Inc., No. 1:09-cv-00704 WI JLT, 2011 U.S. Dist. LEXIS 130604 (E.D. Cal. Nov. 10, 2011) ..................................................................... 17, 27

Nat’l Rural Telecomms. Coop. v. DIRECTV, Inc., 221 F.R.D. 523 (C.D. Cal. 2004) .......................................................... 13, 18

Officers for Justice v. Civil Serv. Comm’n, 688 F.2d 615 (9th Cir. 1982) ...................................................... 12, 13, 16, 17

Satchell v. Fed. Express Corp., No. C03-2659 SI; C 03-2878 SI, 2007 U.S. Dist. LEXIS 99066 (N.D. Cal. Apr. 13, 2007) ........................................................................... 20

Simpao v. Gov’t of Guam, 369 F. App’x 837 (9th Cir. 2010) ................................................................ 21

Sullivan v. DB Inv., Inc., 667 F.3d 273 (3d Cir. 2011) ........................................................................ 34


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United States v. State of Or., 913 F.2d 576 (9th Cir. 1990) ....................................................................... 23

Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011) .......................................................................... 27, 29

West v. Circle K Stores, Inc., No. S-04-0438 WBS GGH, 2006 U.S. Dist. LEXIS 42074 (E.D. Cal. June 13, 2006) ............................................................................ 27

Wren v. RGIS Inventory Specialists, No. C-06-05778 JCS, 2011 U.S. Dist. LEXIS 38667 (N.D. Cal. Apr. 1, 2011) ............................................................................. 20

Statutes

The Class Action Fairness Act, 28 U.S.C. § 1715 et seq................................. 20, 21 Other Authorities

5 Moore’s Federal Practice, § 23.85 ..................................................................... 18

Manual for Complex Litigation (Fourth) § 21.61 (2009) ...................................... 12 Rules

Fed. R. Civ. P. 23 .......................................................................................... passim


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1

PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL APPROVAL OF CLASS SETTLEMENT

MASTER FILE NO. SACV12-1644-CAS(VBKx)

I. INTRODUCTION Plaintiffs Shannon Carty, Matthew Downs, Stephen Gavic, Michelle

McGowan, and Tammie Humphrey (“Plaintiffs”) submit this memorandum in

support of the parties’ Joint Motion for Final Approval of Class Settlement (the

“Joint Motion”). For the reasons stated below, Plaintiffs request that the Court

enter the parties’ proposed Order Granting Final Approval to the Class Action

Settlement, attached as Exhibit A to the parties’ Joint Motion.

The proposed Settlement resolves this consolidated action against Electrolux

Home Products, Inc. (“Electrolux”), alleging that Electrolux- designed and

manufactured “ball-hitch” clothes dryers (the “Dryers”) have “uniform and

dangerous defects . . . that cause these Dryers to catch fire, fail, char clothes, and

spread any fire outside the Dryers, thereby damaging property and creating a

serious safety risk to consumers and the public.” (Consol. Second Amend. Class

Action Compl. (“2AC”), ECF No. 140-1, ¶ 1.) Specifically, Plaintiffs allege that

the Dryers’ design “causes lint to accumulate behind the drum in direct proximity

to the heat source,” which “can ignite and travel into the drum.” (Id. ¶¶ 71-75.)

After two years of contentious litigation, the parties entered into a

Settlement that will confer significant safety, monetary, and non-monetary relief to

the proposed nationwide Settlement Class of owners of certain types of dryers

manufactured by Electrolux. As described in detail in Class Counsel’s1

Application for Attorneys’ Fees and Expenses and for Service Awards (“Fee

Application,” ECF No. 153), Section IV of the Settlement Agreement provides for

several types of benefits to the Settlement Class:

1 Pursuant to this Court’s Preliminary Approval Order (ECF No. 150), Edward A. Wallace, Amy E. Keller, and Dawn M. Goulet of Wexler Wallace LLP; Erin K. Dickinson and Charles J. Crueger of Hansen Reynolds Dickinson Crueger LLC; and Gregory F. Coleman of Greg Coleman Law PC, were appointed Class Counsel pursuant to Fed. R. Civ. P. 23(g).


2 PLAINTIFFS’ MEMORANDUM IN SUPPORT OF THE PARTIES’ JOINT MOTION FOR FINAL


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i Injunctive Relief and Safety Notice. A “Customer Safety Notice”

was sent to identifiable Class members from Electrolux’s own

database, was published on the Settlement website, and now appears

on Electrolux’s own website to inform customers who own the Dryers

at issue that: lint can accumulate behind the drums of the Dryers, the

Dryers need to be regularly cleaned (including behind the drums of

the Dryers), and proper installation, use, and care of the Dryers are

important to avoid fires. (Settlement Agreement ¶ IV.A.) This

portion of the Settlement provides an important safety benefit of

immense value to the Settlement Class Members: they are informed

that the Dryers may accumulate lint next to the Dryers’ heat sources,

and that this lint needs to be removed by an authorized service

professional to reduce the risk of fire. Plaintiffs’ experts believe that

this portion of the Settlement will have a significant impact on

consumer behavior, result in proper cleaning and maintenance of the

Dryers, and substantially reduce the risk of fire in the Dryers. (Fee

Application at 11-12.)

i Free Dryer Safety Service Cleaning Program. Under the

Settlement, Electrolux will provide a Dryer cleaning service (free-of-

charge) from an authorized service technician for those Settlement

Class Members who experienced, within the first five years of

ownership, a qualifying performance problem with their Dryer (i.e., a

problem with overheating, burning, or scorching of laundry loads,

longer than normal Dryer cycle times, abnormal lint buildup inside the

Dryer, sparking of the Dryer’s heating element, burned or scorched

lint inside the Dryer, or observed smoke or burning odor). Further, as

part of this portion of the Settlement, Electrolux will provide— for the




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first time— training and guidance to authorized service technicians

that the drum of the Dryers must be removed for cleaning and that all

lint must be cleaned out of the heater pan. (Settlement Agreement

IV.B.7.) This portion of the Settlement has significant safety benefits

for the Settlement Class: based upon testimony from Electrolux’s own

employees, if consumers regularly cleaned their Dryers, it would

significantly reduce the fire rate. (Fee Application at 10.) Further,

Settlement Class members who follow the Use and Care Guides

supplied with the Dryers and have their Dryers serviced will benefit

from the instructions now given to authorized service providers: the

cleanings performed will also remove any lint that accumulates

behind the drum of the Dryers, next to the heat source, where it could

catch fire. (Fee Application at 10-11, n. 10-11.)

i Compensation for Past Dryer Fires. For those Settlement Class

Members who had a Dryer fire within the first 10 years after purchase,

Electrolux will reimburse them for any unreimbursed, out-of-pocket

expenses the Settlement Class Members incurred (including to repair

or replace the Dryer, for an insurance deductible expense, or for

damages to other property) relating to the fire, up to the lesser of

Dryer’s purchase price or $1,300. (Settlement Agreement IV.E.)

i Compensation for Future Dryer Fires. For those Settlement Class

Members who experience a Dryer fire at some point in the future (but

within the first 10 years after purchase), Electrolux will reimburse

them for any out-of-pocket expenses the Settlement Class Members

incur (including to repair or replace the Dryer, for an insurance

deductible expense, or for damages to other property) relating to that

fire, up to the lesser of Dryer’s purchase price or $1,300. This portion




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of the Settlement will remain in effect until December 31, 2022—

which will require Class Counsel to continue to monitor the

Settlement for the next eight years, and respond to any comments,

inquiries, or concerns from the Settlement Class. (Id. IV.F.)

i Cash Rebate Program. All Settlement Class Members are entitled to

a cash rebate to assist in the purchase of a replacement Electrolux-

brand or Frigidaire-brand clothes dryer or other home appliance (out

of a selection of choices offered by Electrolux), up to a maximum of a

$350 cash rebate.

i New Products Program. All Settlement Class Members who do not

plan to purchase a new home appliance may receive an online code

that can be used to purchase new products (such as a vacuum cleaner,

air cleaner, or appliance/cleaning accessories) at up to a 20% discount

from Electrolux’s website www.electroluxappliances.com.

None of the Settlement’s benefits would require any of the Class Members

to release claims for personal injury or property damage. Moreover, by reducing

the risk of fire, the Settlement will not only reduce future property loss, but will

likely save lives and prevent injuries that would otherwise result from future Dryer

fires.

This comprehensive Settlement is the result of vigorous motion practice,

extensive and expensive expert discovery on multiple technical issues, and a

lengthy, hard-fought negotiation that included: an initial mediation session with

opposing counsel and Electrolux’s in-house counsel in late 2013, several

mediation conference calls with opposing counsel, ex parte conference calls with

nationally-renowned mediator Jonathan Marks, Class Counsel’s submission of

over a hundred pages of briefing to the mediator, two day-long mediation sessions

(which Electrolux’s in-house counsel attended), and numerous post-mediation


www.electroluxappliances.com



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conference calls. (Class Counsel’s Request for Attorneys’ Fees, Expenses, and

Incentive Awards (“Fee Petition”), ECF No. 153, Exhibit 1, Declaration of

Edward A. Wallace (“Wallace Decl.”) at ¶¶ 29-37, and Fee Petition Exhibit 2,

Declaration of Jonathan Marks (“Marks Decl.”), at ¶¶ 9-21.) At the end of the

negotiations, Mr. Marks concluded that the parties were represented by

“experienced and competent counsel,” who were “effective advocates for their

clients. . . .” (Marks Decl. ¶¶ 22-24.)

II. LITIGATION HISTORY On March 9, 2012, Plaintiff Tammie Humphrey filed a class action

complaint against Electrolux in the United States District Court for the Eastern

District of Arkansas. Humphrey v. Electrolux Home Products, Inc., No. 12-cv-

00157 (E.D. Ark.) (“Humphrey”). In that action, Plaintiff Humphrey alleged that

the Dryers contain defects that cause them to start on fire, char clothes, and cause

damage to property. (Humphrey Compl., E.D. Ark. ECF No. 1.) Two subsequent

class actions were filed with similar allegations, including this case, which was

filed on September 27, 2012, by Plaintiffs Shawn Roberts and Nicole Horton.

(ECF No. 1.) On May 6, 2013, the parties filed a joint stipulation to consolidate

the present action with McGowan v. Electrolux Home Products, Inc., No. 12-cv-

05019 (E.D.N.Y.) (“McGowan”), and on May 22, 2013, Plaintiffs Shannon Carty,

Stephen Gavic, Matthew Downs, and Michelle McGowan (who was initially the

plaintiff in the McGowan action) filed a Consolidated Amended Class Action

Complaint in this Action. Also on May 22, 2013, Plaintiffs Roberts and Horton

sought for leave to withdraw as named plaintiffs, which this Court granted on

August 14, 2013 (ECF No. 124). The complaint was again amended on April 15,

2014, to add Plaintiff Tammy Humphrey to the action. (2AC, ECF No. 140-1,

141.)




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Throughout this case’s two-year history, both the Court in this action and in

Humphrey denied Electrolux’s motions to dismiss (ECF No. 67), the parties

engaged in extensive discovery efforts, including: reviewing hundreds of

thousands of pages of documents, taking 18 depositions (including the depositions

of the named Plaintiffs and Electrolux’s employees and several depositions of

Electrolux’s corporate representatives), and preparing numerous expert reports

related to both class and merits issues in this case.

Electrolux served written discovery on Plaintiffs and took each of their

depositions in California, New York, Illinois, Arkansas, and Missouri. Plaintiffs

produced relevant documents within their possession, in addition to hundreds of

thousands of pages of documents and other data— including testing and video— in

the possession of their experts.

Plaintiffs served their initial expert disclosures and reports in October 2013

on topics such as dryer design, materials, human factors and warnings, and

damages in consumer class actions. Electrolux submitted its expert disclosures

and reports in early January 2014, and the parties were preparing for expert

depositions on the eve of class certification briefing when they began engaging in

settlement negotiations.

III. SUMMARY OF THE SETTLEMENT AGREEMENT Class Counsel devoted substantial resources to prepare for and participate in

the mediation sessions that ultimately led to the Settlement. (Wallace Decl. ¶¶ 29-

37.) The parties entered into a nationwide Settlement only after extensive

mediation over the course of several months.

A. Settlement Negotiations and Mediation In late 2013, Class Counsel and both outside and in-house counsel for

Electrolux met in Chicago, Illinois, to discuss a potential resolution to the pending

actions. (Wallace Decl. ¶ 30.) In December 2013, the parties engaged Jonathan




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Marks of MarksADR, LLC, a nationally-renowned private mediator, to assist in

exploring the possibility of resolving Plaintiffs’ class claims. (Marks Decl. ¶ 6.)

The parties provided Mr. Marks voluminous materials, including all pertinent

pleadings, expert reports, orders, and briefing in the case and extensive mediation

statements (Class Counsel provided Mr. Marks with over 100 pages of briefing

specifically drafted for the mediation, itself). (Wallace Decl. ¶ 31.) Mr. Marks

also held ex parte telephone conferences with Plaintiffs’ counsel and Electrolux’s

counsel regarding their respective claims, defenses, and arguments. Id. The parties

thereafter engaged in a formal mediation with Mr. Marks on January 7 and 8,

2014, in Chicago, Illinois. (Marks Decl. ¶ 14.)

With the assistance of Mr. Marks, the parties engaged in arm’s-length

negotiations. (Id. ¶¶ 15-23.) Following numerous proposals and counter-

proposals, the parties’ agreed on many, but not all, of the essential terms of the

settlement. On the second day of the mediation, the parties finally agreed upon the

basic terms of the Settlement, and then and only then did they begin to discuss

attorneys’ fees. (Marks Decl. ¶ 17.) The parties then engaged in subsequent

sessions, with and without Mr. Marks’s involvement, in the following months,

finalizing the Settlement in April 2014. (Id. ¶ 36.)

On April 30, 2014, the parties formally entered into a comprehensive

written Settlement Agreement. The Settlement Agreement provides for a

nationwide settlement of Plaintiffs’ class claims, with the “Settlement Class”

proposed as “all residents of the United States who purchased or currently own,

primarily for personal or household purposes, a Dryer,” (Settlement Agreement

I.LL), with Dryer defined as “Frigidaire-, White Westinghouse-, Kelvinator-,

Gibson-, Tappan-, Crosley-, or Kenmore- brand ball-hitch freestanding clothing

dryers manufactured by Electrolux at its Webster City, Iowa, division between

January 1, 2002, and December 31, 2011.” (Id. I.J.) Excluded from the




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Settlement Class are (a) officers, directors, and employees of Electrolux and its

parents or subsidiaries, (b) insurers of Settlement Class Members, (c) subrogees or

all entities claiming to be subrogated to the rights of a Dryer purchaser, a Dryer

owner, or a Settlement Class Member, and (d) issuers or providers of extended

Dryer warranties or service contracts. (Id. I.LL.)

Class Counsel believes that the Settlement is in the best interests of the

Class because it provides exceptional benefits in the face of substantial litigation

risks.

B. The Settlement Provides Exceptional Benefits for Class Members The nationwide Settlement provides for many different benefits for the

Class members— each of which has been evaluated by Class Counsel to ensure

that the Settlement provides real safety, monetary, and non-monetary relief to the

Settlement Class without requiring any of the Class members to release personal

injury or property damage claims against Electrolux.2 To that end, as explained in

Class Counsel’s Fee Petition, Class Counsel engaged Frank Bernatowicz, who was

assisted by Dr. Marthinus van Schoor, to evaluate the benefits the Settlement

makes available to the class.

1. Monetary Benefits Compensation for Past Dryer Fires. For those Settlement Class Members

who had a Dryer fire within the first 10 years after purchase, Electrolux will

reimburse them for any unreimbursed, out-of-pocket expenses the Settlement

Class Members incurred (including to repair or replace the Dryer, for an insurance

deductible expense, or for damages to other property) relating to the fire, up to the

lesser of Dryer’s purchase price or $1,300. (Settlement Agreement IV.E.)

2 Except for claims related to the purchase price of the Dryer. (Settlement Agreement I.FF.)




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Compensation for Future Dryer Fires. For those Settlement Class

Members who experience a Dryer fire at some point in the future (but within the

first 10 years after purchase), Electrolux will reimburse them for any out-of-pocket

expenses the Settlement Class Members incur (including to repair or replace the

Dryer, for an insurance deductible expense, or for damages to other property)

relating to that fire, up to the lesser of Dryer’s purchase price or $1,300. This

portion of the Settlement will remain in effect until December 31, 2022— which

will require Class Counsel to continue to monitor the Settlement for the next eight

years, and respond to any comments, inquiries, or concerns from the Settlement

Class. (Id. IV.F.)

2. Safety-Related Dryer Service Program Free Dryer Service Cleaning Program. Electrolux’s position from the

commencement of this litigation (indeed, the basis for several of its affirmative

defenses) is that cleaning the Dryers would significantly reduce, if not eliminate,

the risk of fire. (McGowan ECF No. 27 at 26-27; Humphrey ECF No. 52 at 32,

35; Roberts ECF No. 80 at 67.) A dryer cleaning on average costs around $100.

(Wallace Decl., Ex. D.)

Under the Settlement, Electrolux will provide free-of-charge a Dryer

cleaning service from an authorized service technician for those Settlement Class

Members who experienced, within the first five years of ownership, a qualifying

performance problem with their Dryer (i.e., a problem with overheating, burning,

or scorching of laundry loads, longer than normal Dryer cycle times, abnormal lint

buildup inside the Dryer, sparking of the Dryer’s heating element, burned or

scorched lint inside the Dryer, or observed smoke or burning odor). Further, as

part of this portion of the Settlement, Electrolux will provide— for the first time—

training and guidance to authorized service technicians that the drum of the Dryers




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must be removed for cleaning and that all lint must be cleaned out of the heater

pan. (Id. IV.B.7.)

3. Injunctive Relief Injunctive Relief and Safety Notice. While Electrolux provided cleaning

instructions in the past in its Use and Care Guides for the Dryers, the cleaning

instructions were never specific to the design of this Dryer and never advised

consumers that lint could accumulate unseen behind the drums of the Dryers. To

remedy this problem, Class Counsel negotiated that Electrolux put out specific

cleaning instructions and a warning that lint may accumulate behind the drums of

these Dryers. A “Customer Safety Notice” was sent to identifiable Class members

from Electrolux’s own database, published on the Settlement website, and now

appears on Electrolux’s own website to inform customers who own the Dryers at

issue that lint can accumulate behind the drums of the Dryers, the Dryers need to

be regularly cleaned (including behind the drums of the Dryers), and the proper

installation, use, and care of the Dryers are important to avoid fires. (Settlement

Agreement ¶ IV.A.)3 Class Counsel also realized the importance of such a “safety

notice” to Class Members after a survey studied by Class Counsel’s expert Carol

Pollack-Nelson revealed that many of Electrolux’s customers did not review their

Dryer’s Use and Care Guides (where similar “cleaning” instructions were located),

and because the Use and Care Guide for the Dryers did not contain specific

instructions to clean behind the drums of the Dryers— where Plaintiffs alleged that

lint could accumulate next to the heat source and catch fire. (Wallace Decl. ¶ 33.)

This portion of the Settlement provides an important safety benefit of

immense value to the Settlement Class Members: they are informed that the

3 This instruction appears in the “FAQ” of both Electrolux and Frigidaire’s websites in the “Laundry Section” concerning “How often do I need to clean my dryer?”




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Dryers may accumulate lint next to the Dryers’ heat sources, and that this lint

needs to be removed by an authorized service professional to reduce the risk of

fire. Plaintiffs’ experts believe that this portion of the Settlement will have a

significant impact on consumer behavior and substantially reduce the risk of fire in

the Dryers.

4. Additional Benefits Beyond the monetary and injunctive relief, and the free program established

to address the major contributing defect to Dryer fires, Class Counsel also

negotiated for additional benefits for the Class members. These additional benefits

would allow a Class member to replace his or her Dryer with one of the new

models which does not contain the alleged defects (or purchase another home

product) at a significant discount at any point over the next two years. (Settlement

Agreement IV.C.-D.) While Class Counsel did not determine what the “value” of

this portion of the Settlement would be, the benefit to the Class cannot be

understated: it allows Class Members to purchase a new dryer— which does not

contain the defects alleged in Plaintiffs’ complaints— at a significant discount.4

Cash Rebate Program. All Settlement Class Members are entitled to a

cash rebate to assist in the purchase of a replacement Electrolux-brand or

Frigidaire-brand clothes dryer or other home appliance (out of a selection of

choices offered by Electrolux), up to a maximum of $350 off the price.

New Products Program. Alternatively, Class members may elect this

option. All Settlement Class members who do not plan to purchase a new home

appliance may receive an online code that can be used to purchase new products

4 The vouchers and cash rebates can also be combined with other sales or offers and are freely transferrable (they may be sold on the secondary market or given away). (Settlement Agreement IV. C.1.d. and C.4.)




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(such as a vacuum cleaner, air cleaner, or appliance/cleaning accessories) at up to

a 20% discount from Electrolux’s website: www.electroluxappliances.com.

IV. FINAL APPROVAL OF THE SETTLEMENT IS WARRANTED In complex cases like this one, “voluntary conciliation and settlement are

the preferred means of dispute resolution.” Officers for Justice v. Civil Serv.

Comm’n, 688 F.2d 615, 625 (9th Cir. 1982); see also Churchill Village, LLC v.

Gen. Elec., 361 F.3d 566, 576 (9th Cir. 2004). The applicable standard of review

that a district court must apply in evaluating a class action settlement is whether

the settlement, taken as a whole, is “fair, reasonable, and adequate.” Fed. R. Civ.

P. 23(e)(2); Class Plaintiffs v. Seattle, 955 F.2d 1268, 1291 (9th Cir. 1992)

(citation omitted). A settlement is fair, reasonable and adequate when “the

interests of the class are better served by the settlement than by further litigation.”

Manual for Complex Litigation (Fourth) § 21.61 (2009). The decision to approve

or reject the proposed settlement under Rule 23(e) is “committed to the sound

discretion of the trial judge.” Id. (citation omitted). Fed. R. Civ. P. 23(e)(2). The

Court’s discretion and scrutiny “must be limited to the extent necessary to reach a

reasoned judgment that the agreement is not the product of fraud or overreaching

by, or collusion between, the negotiating parties, and the settlement, taken as a

whole, is fair, reasonable and adequate to all concerned.” Officers for Justice, 688

F.2d at 625.

The Ninth Circuit has evaluated whether a settlement is fair, reasonable and

adequate by balancing a number of factors, including: “the strength of the plaintiffs’ case; the risk, expense, complexity, and likely duration of further litigation; the risk of maintaining a class action status throughout the trial; the amount offered in settlement; the extent of discovery completed and the stage of the proceedings; the experience and views of counsel; . . . and the reaction of the class members to the proposed settlement.”


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Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 458 (9th Cir. 2000) (quoting Hanlon v.

Chrysler Corp., 150 F.3d 1011, 1026 (9th Cir. 1998)). “‘This list is not

exhaustive, and different factors may predominate in different factual contexts.’”

In re TD Ameritrade Account Holder Litig., No. C 07-2852 SBA, 2011 U.S. Dist.

LEXIS 103222, at *11 (N.D. Cal. Sept. 13, 2011) (citation omitted). In addition to

the above factors, “the Court may consider the procedure by which the parties

arrived at the settlement.” Id. (citation omitted).

An evaluation of the benefits under the proposed settlement “must also be

tempered by the recognition that any compromise involves concessions on the part

of all the settling parties. Indeed, the very essence of a settlement is compromise,

a yielding of absolutes and an abandoning of highest hopes.” In re NVIDIA Corp.

Derivative Litig., No. C-06-061100-SBA (JCS), 2009 U.S. Dist. LEXIS 24973,

*16 (N.D. Cal. Mar. 18, 2009) (internal quotations omitted).

A. The Strength of Plaintiffs’ Case Favors Approval of the Settlement.

“‘An important consideration in judging the reasonableness of a settlement

is the strength of the plaintiffs’ case on the merits balanced against the amount

offered in the settlement.’” Nat’l Rural Telecomms. Coop. v. DIRECTV, Inc., 221

F.R.D. 523, 525 (C.D. Cal. 2004) (citation omitted). “However, in balancing, ‘a

proposed settlement is not to be judged against a speculative measure of what

might have been awarded in a judgment in favor of the class.’” Id. Indeed, the

trial court should not strive to “reach any ultimate conclusions on the contested

issues of fact and law which underlie the merits of the dispute, for it is the very

uncertainty of outcome in litigation and avoidance of wastefulness and expensive

litigation that induce consensual settlements.” Officers for Justice, 688 F.2d at

625; see also Kent v. Hewlett-Packard Co., No. 5:09-cv-05341-JF (HRL), 2011

U.S. Dist. LEXIS 106825, at *6 (N.D. Cal. Sept. 20, 2011).




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Here, Electrolux raised several significant challenges to Plaintiffs’ claims,

including through multiple motions to dismiss in several district courts. (See

Humphrey ECF Nos. 16-17, 20-21, 24, 30-32, 34, 36, 42, 44; McGowan ECF Nos.

10, 17, 20-21; Roberts ECF Nos. 36, 43-45, 53-54, 60-62, 66-67.) These

challenges revealed potential weaknesses in Plaintiffs’ case with respect to

causation and Plaintiffs’ warranty and consumer fraud claims. For example,

Electrolux contends that its warranty data shows that a large majority of Dryer

owners have not experienced (and will not experience) a Dryer fire. (See

Electrolux Memorandum in Support of Motion for Final Approval, “Electrolux

Mem.” at 7-8.) Additionally, the individual cases against Electrolux that have

gone to trial on a similar defect theory have all been defeated. (Id.) Although

Plaintiffs were largely successful against Electrolux’s motions to strike and

dismiss, the fact that Electrolux did not succeed on these motions does not mean

that it would not have prevailed later in these proceedings, on summary judgment

or at trial.

Another factor to be considered is the risk of maintaining a class action

status throughout the trial. While Class Counsel is confident that a class or classes

could have been certified, they recognize the characteristics of this case that make

class certification on a nationwide basis difficult, and even “the general risks and

burdens on plaintiffs in doing so [] support the propriety of the settlement.” Lane

v. Facebook, Inc., No. C 08-3845 RS, 2010 U.S. Dist. LEXIS 24762, at *17 (N.D.

Cal. Mar. 17, 2010). Furthermore, decertification of a class is always a risk after a

class has been certified. Id. (“The risk that a class action may be decertified at any

time generally weighs in favor of approving a settlement.”) (citation omitted).

The proposed litigation class in this case may have been difficult to certify

depending on Electrolux’s ability to establish Class Members’ potential

individualized experiences with their Dryers and the variations in state law




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requirements concerning breach of warranty, manifestation of defect, and

consumer fraud statutes. For example, Electrolux would argue at the class

certification stage that the cause of any Dryer fire would involve a highly

individualized inquiry for each class member that has nothing to do with the

Dryer’s design, but with whether the Dryer was properly installed, maintained, and

cleaned. (Electrolux Mem. at 7-8.)

In addition, class certification could have been jeopardized due to the need

to apply numerous states’ laws to Plaintiffs’ claims, some of which were pleaded

on a nationwide basis. Plaintiffs faced the risk that varying requirements under

state warranty laws and consumer fraud statutes would have made it extremely

difficult to satisfy predominance and manageability of a national class under Rule

23. See Mazza v. American Honda Motor Co., 666 F.3d 581, 590-94 (9th Cir.

2012).

Accordingly, this factor favors approval of the proposed Settlement.

B. This Case Involved Significant Risk, Complexity, and Demanded Significant Investments of Time and Resources by the Parties and

the Court

Although Class Counsel is confident that they would have prevailed at trial,

they recognize that cases such as this one, involving complex nationwide litigation

against highly experienced and talented defense counsel, present significant risks.

This litigation was contested at every turn and, if not for the proposed Settlement,

would have concluded only after an even more significant investment of time and

resources by the Parties and the Court.

This litigation is still in a pretrial posture. Despite this early stage of

litigation, the Parties have engaged in vigorous motion practice, discovery, and

have exchanged expert reports. (Fee Application at 3-6.) Due to the complex

nature of the consolidated litigation, the sophisticated testing performed by




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Plaintiffs’ expert witnesses, the voluminous discovery produced, and extensive

motion practice, the work performed thus far by Class Counsel has taken over

12,000 hours and resulted in expenses of over $600,000. (Fee Application, Ex. 1

at 12.) However, Electrolux has not yet moved for summary judgment and Class

Counsel has not yet moved for class certification. Pursuing these cases through

class certification, summary judgment, pretrial motion practice— including

potential Daubert challenges to the parties’ numerous experts, and trial would

require the Parties and this Court to dedicate potentially several additional years to

this litigation. Pursuing this case through trial and potential appeals would deprive

Class Members of substantial relief that is certain, immediately available, and long

overdue.

The complexity and expense of class action litigation is well-recognized.

See Linney v. Cellular Alaska P’ship, 151 F.3d 1234, 1242 (9th Cir. 1998) (“[I]t is

the very uncertainty of outcome in litigation and avoidance of wasteful and

expensive litigation that induce consensual settlements.” (quoting Officers for

Justice, 688 F.2d at 625)). This case is no exception. The proposed settlement

will relieve the parties and this Court of the inefficiencies and costs of litigating

this putative class action. This factor, therefore, weighs in favor of final settlement

approval. See, e.g., Eisen, 2014 U.S. Dist. LEXIS 14301, at *11 (“Settlement

avoids all possible risks of continued litigation, including the possibility that

plaintiffs would not succeed at trial. Here, the advantage to the Class of avoiding

those risks favor settlement of this action.”).

C. The Settlement Provides Substantial Relief for the Class “‘When analyzing the amount offered in settlement, the Court should

examine ‘the complete package taken as a whole,’ and the amount is ‘not to be

judged against a hypothetical or speculative measure of what might have been

achieved by the negotiators.’” Morales v. Stevco, Inc., No. 1:09-cv-00704 WI




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JLT, 2011 U.S. Dist. LEXIS 130604, at *28 (E.D. Cal. Nov. 10, 2011) (quoting

Officers for Justice, 688 F.2d at 625, 628) (emphasis in the original). Against the

backdrop of the significant risks and uncertainty that Class Members faced in

proceeding with this litigation through trial and appeals, the results obtained on

behalf of the Class are remarkable.

Class Counsel began investigating the issues underlying this action prior to

filing the Humphrey Action in 2012. After continuous and exhaustive research,

investigation, discussions with experts, consultants, and consumers, and pursuing

cases against Electrolux in several different district courts in the over two years

that followed, the Parties engaged in settlement discussions over the course of

several months to resolve this matter. The Settlement provides significant safety

benefits to the Class members— without requiring any of them to waive personal

injury or property damage claims (save for the economic loss associated with the

Dryers, themselves). (Fee Application at 8-13.) The value of the Settlement—

excluding the value of the cash rebates or vouchers— is estimated to be as high as

$43 million using an expected utilization rate, with total potential exposure to

Electrolux of $155 million. (Id., Wallace Decl. Ex. D.) In addition and of

significant importance, by reducing the risk of fire, the Settlement will likely save

lives and prevent injuries from future Dryer fires.

This Settlement— achieved after years of work invested by Class Counsel in

developing, prosecuting and resolving this complex class action— represents an

excellent recovery. These benefits balanced against the aforementioned risks and

costs of continued litigation, weigh in favor approval of the Settlement.

D. This Settlement Comes at the Completion of Discovery “In the context of class action settlements, ‘formal discovery is not a

necessary ticket to the bargaining table’ where the parties have sufficient

information to make an informed decision about settlement.’” Linney, 151 F.3d at




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1239 (citation omitted). However, “[a] court is more likely to approve a

settlement if most of the discovery is completed because it suggests that the parties

arrived at a compromise based on a full understanding of the legal and factual

issues surrounding the case.” Nat’l Rural Telecomms. Coop., 221 F.R.D. at 527

(citing 5 Moore’s Federal Practice, § 23.85[2][e]). That is because “[a] settlement

following sufficient discovery and genuine arms-length negotiation is presumed

fair.” Id. at 527.

Here, the parties reached the proposed settlement after the completion of all

fact discovery. In connection with these discovery proceedings, numerous

depositions of Electrolux’s representatives and employees, third parties, and the

named Plaintiffs were taken, expert reports were exchanged, and hundreds of

thousands of pages of documents were exchanged by the parties. As a result, the

Settlement Agreement was signed only after Plaintiffs and Electrolux had

exhaustively examined the factual and legal bases of Plaintiffs’ claims.

Together, Class Counsel’s intensive and comprehensive approach to this

case and these settlement discussions allowed them to assess the attributes of this

Settlement, particularly in light of the strengths, weaknesses and risks attendant to

the litigation. As a result, this factor weighs in favor of approving the proposed

Settlement.

E. Class Counsel Believes This Settlement Is in the Best Interest of the Class

Courts also consider the views of experienced class counsel in determining

whether a proposed Settlement is fair, reasonable and adequate. See, e.g., Hanlon,

150 F.3d at 1026. Class Counsel possess several decades of experience in

complex class action litigation as well as particular expertise related to product

defect liability. (See Plaintiffs’ Memorandum in Support of Motion for

Preliminary Approval, “Preliminary Approval Mem.,” at 24, Ex. 1.) Class




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Counsel’s experience and qualifications have allowed them to develop an acute

understanding of the strengths and weaknesses of Plaintiffs’ claims, as well as

Electrolux’s defenses to those claims. Consequently, Class Counsel is well-

positioned to evaluate the benefits of this Settlement in light of the risks of

continued litigation. (See, e.g., Preliminary Approval Mem., Ex. 1; Wallace Decl.

at ¶4 (“Class Counsel are particularly experienced in the litigation, certification,

trial, and settlement of nationwide class action cases involving allegedly defective

products like those at issue here.”); Marks Decl. at ¶¶22-24 (parties represented by

“experienced and competent counsel,” who were “effective advocates for their

clients. . . .”).)

Class Counsel firmly believe that the compromise embodied in this

Settlement represents a significant achievement and beneficial resolution of this

highly complex litigation. As such, Class Counsel strongly recommend that the

Court approve the proposed Settlement.

F. The Settlement Is The Product Of Hard-Fought, Arm’s-Length Negotiations

The Court also “considers whether the Settlement was likely the result of

good faith negotiations at arm’s length, or whether it was the product of fraud or

collusion.” In re TD Ameritrade Account Holder Litig., 2011 U.S. Dist. LEXIS

103222, at *19 (citation omitted). Class Counsel engaged in several months of

settlement negotiations, including two sessions and numerous conference calls

with nationally-renowned mediator Jonathan Marks. (Preliminary Approval Br. at

12-14; Marks Decl. ¶¶14-23.) At all times, these settlement discussions were

conducted at arm’s-length, with each side vigorously advocating for optimum

results on behalf of its client(s). (Marks Decl. ¶¶15-23.) The conditions under

which this Settlement was achieved “supports a finding that the parties reached the

settlement in a procedurally sound manner and that it was not the result of




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collusion or bad faith by the parties or counsel.” Wren v. RGIS Inventory

Specialists, No. C-06-05778 JCS, 2011 U.S. Dist. LEXIS 38667, at *42 (N.D. Cal.

Apr. 1, 2011); see also Satchell v. Fed. Express Corp., No. C03-2659 SI; C 03-

2878 SI, 2007 U.S. Dist. LEXIS 99066, at *17 (N.D. Cal. Apr. 13, 2007) (“The

assistance of an experienced mediator in the settlement process confirms that the

settlement is non-collusive.”).

As a result, this factor heavily favors approval of the proposed Settlement.

G. The Notice Requirements of the Class Action Fairness Act Are Satisfied

Several stages of the Notice Plan approved by the Court in its Preliminary

Approval Order have already been implemented by the Claims Administrator in

accordance with the Court’s directives. (See generally Declaration of Carla C.

Peak, “Peak Decl.,” ECF No. 152.) Pursuant to the Court-approved Notice Plan,

individual notice was directly mailed to 678,440 identifiable Settlement Class

Members, and directly e-mailed to 30,465 identifiable Settlement Class Members

for whom Electrolux possessed an e-mail address. (Id. ¶¶5-8.) In addition to

direct notice, the Claims Administrator ran an extensive media plan, which will

continue in the fall, with publications in national magazines such as Parade and

People, as well as Internet advertisements on various websites including

Facebook.com and HGTV.com. (Id. at ¶¶9-12.) The Settlement Administrator

also established a settlement website, www.dryersettlement.com, where the notice,

safety documents, and court filings were posted, and established a toll-free number

for Settlement Class Members to learn more about the Settlement and request

Claim Forms. (Id. at ¶¶13-12.) The Notice Plan was designed to reach over 70%

of the likely Class members. (Id. at ¶¶9-15; Preliminary Approval Mem., Ex. B at

¶14.) The Notice Plan complies with the Court’s Preliminary Approval Order,

satisfies Rules 23(c) and (e), and meets the requirements of due process. See, e.g.,


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Simpao v. Gov’t of Guam, 369 F. App’x 837, 838 (9th Cir. 2010) (notice published

by radio, television, and newspaper and mailed directly to 49,000 class members

satisfied due process).

Further, the Class Action Fairness Act, 28 U.S.C. § 1715 et seq. (“CAFA”),

required Electrolux to notify appropriate state and federal officials of the proposed

settlement and to allow 90 days to pass before final approval of the proposed

settlement may be entered. See 28 U.S.C. § 1715(d). The Claims Administrator

sent the required CAFA notices on May 9, 2014, thus satisfying this requirement.

(Declaration of Kenneth E. Stalzer, “Stalzer Decl.,” ECF No. 158-1, at ¶7.) More

than 90 days have elapsed from the issuance of the first CAFA notice. This

procedure adequately satisfies the CAFA notice requirements. See, e.g., Laguna v.

Coverall of N. Am., Inc., No. 12-55479, 2014 U.S. App. LEXIS 10259, at * (9th

Cir. June 12, 2014) (discussing 90-day requirement).

H. The Reaction of the Class Has Been Overwhelmingly Positive Finally, “‘[i]t is established that the absence of a large number of objections

to a proposed class action settlement raises a strong presumption that the terms of

the proposed class settlement action are favorable to the class members.’” In re

Omnivision Techs., 559 F. Supp. 2d 1036, 1043 (N.D. Cal. 2007) (citation

omitted).

The response to this Settlement has been resoundingly favorable. So far, the

Claims Administrator has informed the Parties that the settlement website,

www.dryersettlement.com, has received 126,758 visits, and Class Members have

submitted 20,368 claims. (Stalzer Decl. at ¶¶2-3.) Class Members have until

December 15, 2014 to make claims pursuant to the terms of the Settlement, and

the Claims Administrator estimates that there will be a spike in the number of

claims filed in the last several weeks leading up to the claims-filing deadline

(especially when Electrolux will be advertising the cash rebate program in


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November 2014). (Id. at ¶3.) As of August 5, 2013, the Claims Administrator has

only received 62 timely requests for exclusion, and objections from 10 Class

Members to the Settlement, four of whom are represented by counsel. (Id. at ¶¶4-

5.) However, several objectors have already indicated that they are withdrawing

their objections, and Class Counsel will file a declaration with the Court providing

the status of these objections in the coming days. The very small number of

potentially dissatisfied Class Members weighs heavily in favor of approving this

Settlement. Indeed, courts have found this factor favors approval of the proposed

settlement where much higher percentages of objections were filed. See, e.g.,

Fulford v. Logitech, Inc., No. 08-cv-02041 MMC, 2010 U.S. Dist. LEXIS 29042,

at *12 (N.D. Cal. Mar. 5, 2010) (holding that the response of the Class favored

settlement where 12 of 82,000 Class Members objected); Churchill Vill., L.L.C. v.

GE, 361 F.3d 566, 577 (9th Cir. 2003) (approving settlement with 500 opt-outs

and 45 objections out of approximately 90,000 class members). Additionally,

none of the states’ Attorneys General who received the notice of Settlement has

objected. (Stalzer Decl. at ¶7.) This factor favors approval of the Settlement.

For the above reasons, this Court should grant final approval of the

proposed Settlement.

V. THE COURT SHOULD OVERRULE THE OBJECTIONS The few remaining objections submitted in this case are without merit and

should be overruled. The common theme of these objections is that the Settlement

could have been “better” by providing different or additional relief:

As the Ninth Circuit recognized in Hanlon v. Chrysler Corp.:

Of course it is possible . . . that [a] settlement could have been better. But this possibility does not mean [a] settlement presented [is] not fair, reasonable or adequate. Settlement is the offspring of compromise; the question we address is not whether the final product could be prettier, smarter or snazzier, but whether it is fair, adequate and free from collusion. In this regard, the fact that the overwhelming




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majority of the class willingly approved the offer and stayed in the class presents at least some objective positive commentary as to its fairness. There [is] no disparate treatment between class members; all stood to benefit equally, a fact which lessens the likelihood that the named Plaintiff and their attorneys colluded with [the defendant] to increase their own recovery at the expense of the unnamed Plaintiff who Class Counsel had a duty to represent. . . .[Objectors who] . . . thought that [their personal claim was being sacrificed for the greater good] had the right to opt out of the class.

Hanlon, 150 F.3d at 1027. Indeed, this Court’s order preliminarily approving the

Settlement found that the Settlement was presumptively valid and reasonable, so

any objector would face a “heavy burden” in demonstrating that the Settlement is,

in fact, unreasonable. United States v. State of Or., 913 F.2d 576, 581 (9th Cir.

1990) (quotations omitted). None of the objectors have met this burden.

The remaining objectors represent a miniscule percentage of the 6.4 million

Settlement Class Members. However, “even if a majority of the class is opposed

to the settlement,” the Court could approve the settlement “as long as [it]

determine[s] that the overall settlement is fair, adequate, and reasonable under the

circumstances and as a whole.” In re Telectronics Pacing Sys., Inc., 137

F. Supp. 2d 985, 1018 (S.D. Ohio 2001). Some of the objectors argue—

inaccurately— that the Settlement achieves no benefits for the Class. Other

objectors believe that their special circumstances would require them to have

different relief; however, those individuals may simply opt out of the Settlement,

rather than object and remain a member of the Settlement Class. As this Court has

recognized, “Federal courts routinely hold that the opt-out remedy is sufficient to

protect class members who are unhappy with the negotiated class action settlement

terms.” Eisen v. Porsche Cars N. Am., Inc., 2:11-cv-09405-CAS-FFMx, 2014

U.S. Dist. LEXIS 14301, *20 (C.D. Cal. Jan. 30, 2014).

Class Counsel is also aware of several serial objectors who have filed

objections on behalf of their clients in this matter. See Dennis v. Kellogg Co., No.




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09-cv-1786-L (WMc), 2013 U.S. Dist. LEXIS 163118, at **11-12 (S.D. Cal. Nov.

14, 2013) (discussion of Darrell Palmer’s status as a “serial objector” with a

“history” of “admit[ed]” “bad faith and vexatious conduct”); In re Am. Int’l Grp.,

Inc. Sec. Litig. No. 04-cv-08141-DAB, DE # 663, 664 (S.D.N.Y. Oct. 1, 2012)

(Steve Miller withdrew his appeal of an order rejecting his objections to a

settlement, without having provided any benefit to class); In re Wal-Mart Wage

and Hour Employment Practices Litig., MDL No. 1735, 2010 U.S. Dist. LEXIS

21466 (D. Nev. Mar. 8, 2010) (noting that Christopher Bandas, among others, has

“a documented history of filing notices of appeal from orders approving other

class action settlements, and thereafter dismissing said appeals when they and their

clients were compensated by the settling class or counsel for the settling class.”).

Pursuant to this Court’s instruction, Class Counsel will be filing separate briefing

addressing these and any remaining objectors no later than August 11, 2014.

VI. THE CLASS SHOULD BE CERTIFIED FOR SETTLEMENT PURPOSES

The Federal Rules of Civil Procedure allow a case to be certified as a class

action only if the action satisfies all four requirements of Rule 23(a)— numerosity,

commonality, typicality, and adequacy— and at least one of the three categories in

Rule 23(b). These requirements apply when a class is proposed to be certified for

settlement purposes. See Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 617

(1997) (holding that requests for settlement-only class certification are subject to

Rule 23’s certification requirements). In the context of settlement, “Rules 23(a)

and (b) continue to serve the purpose of ‘focus[ing] court attention on whether a

proposed class has sufficient unity so that absent members can fairly be bound by

decisions of class representatives.’” In re AIG, Inc. Sec. Litig., 689 F.3d 229, 239

(2d Cir. 2012) (quoting Amchem, 521 U.S. at 621) (alteration in original).




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Here, the parties5 propose that the Court certify the following Settlement

Class and Subclasses for settlement purposes:

Settlement Class. All residents of the United States who purchased,

primarily for personal or household purposes, a Dryer. A “Dryer” is

defined in the Settlement Agreement as Frigidaire-, White

Westinghouse-, Kelvinator-, Gibson-, Tappan-, Crosley-, or Kenmore-

brand ball-hitch freestanding clothing dryers manufactured by

Electrolux between January 1, 2002, and December 31, 2011.

Excluded from the Settlement Class are (a) officers, directors, and

employees of Electrolux and its parents or subsidiaries, (b) insurers of

Settlement Class Members, (c) subrogees or entities claiming to be

subrogated to the rights of a Dryer purchaser, a Dryer owner, or a

Settlement Class Member, and (d) issuers or providers of extended

Dryer warranties or service contracts.

The parties also seek the certification of the following two subclasses for

settlement purposes:

Past Dryer Fire Subclass. All Settlement Class Members who

experienced a Past Dryer Fire Event, defined as a fire in the drum,

behind the drum, in the lint screen or adjacent air duct and blower, or

base of the Dryer that occurred within 10 years after the purchase date

of the Dryer and caused the Settlement Class Member to incur some

unreimbursed out-of-pocket expense, including, but not limited to,

5 For purposes of effecting the Settlement, Electrolux stipulates that the numerosity, commonality, typicality, and adequacy requirements of Rule 23(a) are satisfied and that, pursuant to Rule 23(b)(3), questions of law and fact common to all members of the proposed Settlement Class predominate and certification of the Class for settlement purposes is superior to other available methods for fairly and efficiently adjudicating the controversy.




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property damage, insurance deductible, or repair or replacement of

their Dryer.

Future Dryer Fire Subclass. All Settlement Class Members who

experience a Future Dryer Fire Event, defined as after the Final

Approval Order has been entered, but within the first 10 years after

purchase of the Dryer, a fire occurs in the drum, behind the drum, in

the lint screen or adjacent air duct and blower, or base of the Dryer

and causes the Settlement Class Member to incur some unreimbursed

out-of-pocket expense, including, but not limited to, property damage,

insurance deductible, or repair or replacement of their Dryer.

The Settlement Class will exclude those Class Members who have

properly opted out of the Settlement Class. As each of the requirements under

Rule 23(a) and Rule 23(b)(3) have been met, this Class should be certified for

settlement purposes.

A. Rule 23(a) Requirements Before certifying a class, Rule 23(a) requires that the Court find that:

1. the class is so numerous that joinder of all members is impracticable,

2. there are questions of law or fact common to the class,

3. the claims or defenses of the representative parties are typical of the

claims or defenses of the class, and

4. the representative parties will fairly and adequately protect the

interests of the class.

Rule 23(a). In light of the proposed Settlement, as discussed below, Plaintiffs and

the Settlement Class meet the requirements of Rule 23(a), commonly referred to as

numerosity, commonality, typicality, and adequacy of representation.




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1. The Numerosity Requirement is Satisfied for Final Approval

Rule 23(a)(1) requires that the class be so numerous that joinder of all class

members is impracticable. Impracticability, however, does not mean

impossibility. Harris v. Palm Springs Alpine Estates, Inc., 329 F.2d 909, 913 (9th

Cir. 1964). Classes with fewer than seventy (70) members have been certified in

numerous cases. See, e.g., Jordan v. County of Los Angeles, 669 F.2d 1311, 1320

n.10 (9th Cir. 1982). vacated on other grounds, 459 U.S. 810 (1982); see also

EEOC v. Kovacevich “5” Farms, No. CV-F-06-165 OWW/TAG, 2007 U.S. Dist.

LEXIS 32330, at *57 (E.D. Cal. April 18, 2007) (“Courts have routinely found the

numerosity requirement satisfied when the class comprises 40 or more members.”)

(citation omitted). In this case, the numerosity requirement is easily satisfied. The

estimated size of the Settlement Class is over 6.4 million. Further, the number of

individuals who filed claims pursuant to the Settlement thus far, alone, is over

20,000. (Stalzer Decl. ¶2.) Both of these factors support a finding of numerosity.

2. The Commonality Requirement is Satisfied for Final Approval

Because “[t]he Ninth Circuit construes commonality liberally, it is not

necessary that all questions of law and fact be common.” West v. Circle K Stores,

Inc., No. S-04-0438 WBS GGH, 2006 U.S. Dist. LEXIS 42074, at *3 (E.D. Cal.

June 13, 2006) (citing Hanlon, 150 F.3d at 1019). “Commonality ‘does not mean

merely that [class members] have all suffered a violation of the same pro-vision of

law,’ but ‘claims must depend upon a common contention.’” Morales v. Stevco,

Inc., No. 1:09-cv-00704 AWI JLT, 2011 U.S. Dist. LEXIS 130604, at *16 (E.D.

Cal. Nov. 10, 2011) (quoting Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541,

2551 (2011)).




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In this case, the following common questions of fact and law exist, to which

common responses are available as to every member of the Class, including, but

not limited to:

i Whether the Dryers designed, manufactured, and sold by

Electrolux possess material defects;

i Whether the Defects in the Dryers represent an unreasonable

risk that a fire will occur;

i Whether Electrolux knew, or should have known, that the

Dryers possessed the Defects when it placed them into the

stream of commerce;

i Whether the existence of the Defects are material facts

reasonable purchasers would have considered in deciding

whether to purchase a clothes dryer;

i Whether the Dryers are of merchantable quality;

i Whether Electrolux breached express warranties relating to the

Dryers by failing to recall, replace, repair and/or correct the

Defects in the Dryers;

i Whether Electrolux breached the implied warranty of

merchantability implied in every sale of goods;

i Whether Electrolux m

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Active Cases - EDWARD A. WALLACE (pro hac vice AMY E ......1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 EDWARD A. WALLACE (pro hac vice) AMY E. KELLER