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May 8, 2002 Order of Trial Court Approval
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
IN RE: INTER-OP HIP PROSTHESIS PRODUCT LIABILITY LITIGATION
CASE NO. 1:01-CV-9000
(MDL DOCKET NO. 1401)
JUDGE O’MALLEY
MEMORANDUM AND ORDER
On March 12, 2002, the parties in this national class action lawsuit submitted to the
Court a purposed Settlement Agreement and a joint motion for preliminary approval. The
Court granted that motion on March 13, 2002, and directed that Final Notice of the
purposed Settlement be published to members of the class. The Final Notice explained the
terms of the Settlement Agreement; advised class members of their rights to participate
in, enter objections to, and/or opt out of the purposed Settlement Agreement; and informed
the Class that the "final fairness hearing" was scheduled to begin May 6, 2002.
Before the final fairness hearing, the Court received two motions - one from the Sulzer
defendants and one from teh Plaintiff Class - each asking the Court to enter an Order
certifying the Plaintiff Class and granting final approval to the Settlement Agreement
(docket nos. 315, 328). Appended to these two lengthy motions were a banker’ box
worth of declarations and other evidence in support of the parties’ motions. The
Court also received seven written objections to certain terms of the proposed settlement.1
On May 6-7, 2002, the Court held its final fairness hearing to take additional evidence
regarding the fairness, reasonableness, adn adequacy of the proposed Settlement Agreement,
the propriety of final class certification, and the propriety of granting final approval
to teh proposed Settlement Agreement.
During the hearing, the Court received testimony from 13 witnesses, all testifying in
support of the settlement. Though given the opportunity, no objector spoke at the hearing.
The Court undertook its own questioning of witnesses and pursued the concerns raised by all
of the objectors, including those who had withdrawn their objections prior to hearing. It
is not an overstatement to say that the evidence weighing in favor of the proposed
settlement agreement was overwhelming. Attorneys who represent hundreds of class members
and who had objected strongly to an earlier proposed settlement joined in a chorus of
support for the current proposed Settlement Agreement. A large number of attorneys and
witnesses representing disparate interests all averred they believe the Settlement
Agreement has extracted from the defendants close to the best terms possible without
forcing the defendants into bankruptcy - an alternative that all felt would be disastrous
for the Class. One witness - who had earlier opposed both national class certification and
the terms of the first proposed settlement agreement - summed up when he testified he
believes the current Settlement Agreement is "the best opportunity for the most
people to recover the most money the soonest."2 Essentially, the message
the Court received, from both represented and unrepresented Class members, was that it
would be unjust and unfair if the Court did not approve the proposed Settlement
Agreement.
The Court has carefully considered the sum of the evidence presented, and has also done
substantial independent legal analysis of the standards applicable to the pending motions.
For reasons the Court will explain at length in a separate memorandum to follow, the Court
concludes that the pending motions are well-taken. That is, the Court concludes that:
- the class (and subclasses) identified in the Fifth Amended and Consolidated Class Action
Complaint, and also in the Settlement Agreement, satisfies the requirements of Fed. R.
Civ. P. 23(a), as well as Fed. R. Civ. P. 23(b)(2) and (b)(3); and
- the Notice that was sent to the Class was the best practicable under the circumstances,
and satisfies the requirements of Fed. R. Civ. P. 23(c)(2) & (e) and
- the proposed settlement was reached after extensive arms-length negotiations and is
premised upon substantial inquiry into and discovery relating to all legal and factual
issues relevant to the propriety of the proposed Settlement Agreement; and
- the proposed Settlement Agreement is fair, adequate, and reasonable, and meets the
requirements of Fed. R. Civ. P. 23(e).
Indeed, the Court finds that the sizeable and detailed record complied by the parties compels
the conclusion that this settlement represents an eminently fair and reasonable resolution
for the entire Plaintiff Class. Accordingly, the parties’ motions seeking an Order
certifying the Plaintiffs Class and granting final approval to the Settlement Agreement
are both GRANTED.
Finally, the Court notes that, in its Order dated March 14, 2002, the Court recited the
following critical dates:
- "the Injunction Order shall remain in force until 5:00 p.m. EST, on the date
twenty-one (21) business days after the Court rules on the Final Fairness of the
Settlement Agreement," and
- "Class Members who wish to exclude themselves from the Final Settlement shall
submit Notice of their intent to opt out on the date five (5) business days after the
Court rules on the Final Fairness of the Settlement Agreement."
Order at 3. Given that the Court has ruled on the final fairness of the Settlement
Agreement as of May 8, 2002, the Injunction Order shall remain in force until 5:00 p.m.
EST, June 7, 2002, and the opt-out deadline shall be May 15, 2002.
This Order is entered on Wednesday, May 8, 2002.
IT IS SO ORDERED
s/Kathleen M. O’Malley
KATHLEEN McDONALD O’MALLEY
UNITED STATES DISTRICT JUDGE
1The Court originally received approximately 30 objections. Notably,
however, many of the objectors had an incomplete or incorrect understanding of the
Settlement Agreement. After speaking with Plaintiffs’ Class counsel and reviewing the
Settlement Agreement in greater detail, the vast majority of the objectors withdrew their
objections. Currently, there remain only seven objections. This is remarkable, given a
class membership in excess of 30,000 persons.
2As another witness stated, "this is the best mechanism for
resolution in this particular case under these particular circumstances." |