Semiannual Guide to Expert Witnesses

April 2005 / $4

The Intersectionof Probate andFamily Lawpage 29

Class WarsLos Angeles lawyer Brad W. Seiling explains how successful

class action lawsuits can result in malpractice claims page 22

Semiannual Guide to Expert Witnesses

The Intersectionof Probate andFamily Lawpage 29

PLUS

E A R N MCLE CR E D I T

New Punitive Damages Tax page 14

Solvent Tenants in Bankruptcy page 18

Trademark Infringement Damages page 36

LosAngelesLawyerThe magazine of

The Los Angeles County

Bar Association

DEPARTMENTS

10 Barristers TipsInvoking the procedure for judicial disqualificationBY GAVIN HACHIYA WASSERMAN

14 Practice TipsAssessing the impact of the new law onpunitive damagesBY JAMES J. FARRELL AND JEREMY G. SUITER

18 Practice TipsFiling bankruptcy by solvent tenants to caplandlords’ claimsBY DAVID S. KUPETZ

2005 Vol. 28, No. 2

FEATURES

22 Class Wars BY BRAD W. SEILING

In the wake of a recent appellate decision, class counsel may face a greater likelihoodof malpractice claims and attacks on class settlements

29 Tales of Two Courts BY HOWARD S. KLEIN

Family court proceedings may give rise to issues that eventually must be settled inprobate court

Plus: Earn MCLE credit. MCLE Test No. 136 appears on page 31.

36 Marked Recovery BY ANTONIO R. SARABIA II

The new provision for statutory damages in trademark infringement cases has alreadycreated a substantial body of case law

41 Special SectionSemiannual Guide to Expert Witnesses

Cover photograph by Tom Keller

April

79 Computer CounselorTechnology trends affecting the practice of lawBY GORDON ENG

84 Closing ArgumentA Washington fable for our timeBY KEITH PAUL BISHOP

81 Classifieds

82 Index to Advertisers

83 CLE Preview

CLASS

Afunny thing hap-pened to a lawfirm on the way tocollecting a $90million judgmentin favor of its cli-ents. One of theclients—a memberof a certified class

of more than 2,000 insurance claimsadjusters—sued the attorneys for malpractice.The California Court of Appeal has allowedthe claim to proceed as a second putativeclass action. This recent appellate decisionraises some obvious questions. Where couldthese attorneys possibly have gone wrong?When is a $90 million judgment not enough?The court of appeal’s answers to these ques-tions have wide-ranging significance in classaction litigation.

In Janik v. Rudy, Axelrod & Zieff,1 thecourt of appeal held that class counsel owedits clients (members of the class in the under-lying litigation) a duty to consider and assertadditional claims that could have increased

the class’s recovery, even though those claimswere not part of the trial court’s certifica-tion order. Janik appears to be the firstreported California decision recognizing thatclass counsel can be liable in malpracticebased on its successful representation of a cer-tified class. The duties articulated in Janikextend beyond actions for legal malpracticeand potentially raise a new obstacle to classsettlements.

Class settlements are often criticized andchallenged as collusive deals between greedyclass counsel out to line their pockets andunscrupulous defendants trying to buy aninexpensive resolution of claims alleging seri-ous injury to consumers. The sweeping ratio-nale announced in Janik would apply equallyto class counsel that settle class claims, evenif they achieve substantial benefits for theclass. Dissatisfied class members (and thecounsel who represent them) now may attackclass counsel for breaching duties to a set-tlement class by selling out the class’s claimstoo cheaply.

Before examining the conundrum that

Janik poses for class action settlements, it isuseful to understand how the court of appealcould conclude that seemingly successful classcounsel potentially breached their duties to theclass. The underlying litigation in Janik wasone of the seminal cases in the area of wageand hour law in California. The case involveda class action against Farmers Insurance onbehalf of more than 2,400 claims adjusters torecover nonpayment of overtime wages. Thecomplaint, which was filed in 1996, asserteda single cause of action under the LaborCode. In 1998, the trial court certified a classof all claims adjusters who worked forFarmers from October 1, 1993 (three yearsprior to the filing of the complaint), to the dateof trial.

After notice was sent and class memberswere given the opportunity to opt out of the

Los Angeles Lawyer April 2005 23

Brad W. Seiling is a partner in Manatt, Phelps &Phillips and is cochair of the firm’s Unfair Comp-etition Practice Group. He specializes in the defenseof class action lawsuits and lawsuits brought underthe Unfair Competition Law.

WARSTo ward off objectors, class counsel may solicit the guidance of

judges and mediators in the settlement process

by Brad W. Seiling

KEN

SU

SYN

SKI

class, class counsel successfully moved forsummary adjudication on the ground thatthe members of the class were not exemptfrom overtime regulations. This favorableruling was affirmed on appeal.2

A jury then awarded the class approxi-mately $90 million in unpaid overtime wages,and that judgment was affirmed on appeal.3

Class counsel had won a substantial award forthe class and in the process had made new lawin the area of wage and hour class actions.These results would not seem to support amalpractice case, but that is exactly whathappened next.

After the trial, a second putative classfiled a malpractice suit alleging that classcounsel breached their duties to the class byfailing to assert a claim under California’sUnfair Competition Law, codified at Businessand Professions Code Section 17200 et seq.,which carries a four-year statute of limitationsperiod—one year longer than the limitationsperiod under the Labor Code. By not amend-ing the complaint to assert a UCL claim,class counsel allegedly deprived the class ofmillions of dollars of additional unpaid wages.

The trial court sustained the attorneys’demurrer without leave to amend and dis-missed the malpractice action. The demurrercontended that the trial court’s certificationorder in the underlying litigation proscribedthe bounds of any duty the attorneys owed tothe class, and unnamed class members had noright to demand that class counsel assertadditional claims.4

The court of appeal reversed, finding thatthe plaintiff had stated claims for negligenceand breach of fiduciary duty. The courtrejected the attorneys’ argument that theirduty to the class was limited to competentlyprosecuting the claims that the court certified.Class counsel, like all attorneys, have a dutyto at least consider and advise their clients ofrelated matters that could be pursued toavoid prejudice to the client:

In the context of a class action, boththe representative plaintiffs and theabsent class members similarly areentitled to assume their attorneys willconsider and bring to the attention ofat least the class representatives addi-tional or greater claims that may existarising out of the circumstances under-lying the certified claims that classmembers will be unable to raise if notasserted in the pending action. Theclass members are entitled to assumetheir attorneys are attempting to max-imize their recovery for the conductthey are challenging and that they arenot, without good reason, failing toassert those claims that will do so.5

The court of appeal also rejected the argu-ment that the class action litigation was the

exclusive forum to challenge the adequacy ofclass counsel’s representation. The initialdetermination of whether counsel were ade-quate to represent the class—a prerequisite toany certification order—was very differentfrom the determination of whether class coun-sel actually adequately represented the classthroughout the litigation. The trial court inthe underlying class action never consideredwhether class counsel had adequate reason toforego asserting a UCL claim.6

There were many good reasons why theattorneys chose not to risk asserting a UCLclaim after obtaining favorable rulings oncertification and summary adjudication on lia-bility. When counsel filed their original com-plaint in 1996, it was not clear whether backwages were recoverable as restitution underthe UCL. Cortez v. Purolator Air FiltrationProducts Company,7 the California SupremeCourt’s decision recognizing that unpaidwages could be recovered as an item of resti-tution under the UCL, was decided in 2000,after the trial court had certified the class inthe underlying litigation. Class counsel did notbelieve that it was even possible to amend thecomplaint to assert a claim recognized bythe Cortez decision, and counsel certainlywould not have wanted to risk reopeningthe issue of certification or to otherwise jeop-ardize their favorable rulings on the merits.8

Notwithstanding the “sound strategic rea-sons for not seeking to amend the complaintafter the Supreme Court decided Cortez,”the Janik court held that whether such tacti-cal decisions amount to a breach of a classcounsel’s duties to the class presents a ques-tion of fact that could not be resolved ondemurrer.9

Sweeping New Duty

The court’s rationale confirms the centralrole that the UCL plays in consumer litigation.UCL claims are common in consumer classaction cases, even if the comparatively limitedremedies available under the UCL (particu-larly the limited monetary remedies in lightof recent California Supreme Court rulings)mean that a UCL claim adds little to a class’spotential recovery. That a plaintiff can takeadvantage of the four-year statute of limita-tions under the UCL in itself would justifyasserting a UCL claim in almost every con-sumer case. Indeed, in light of Janik, plaintiff’slawyers act at their peril if they do not allegea UCL claim in a class action lawsuit.Underscoring the importance of the UCL isnothing new.10

What is new is the sweeping new duty thatthe court of appeal imposed on class counsel.The California Supreme Court previouslyhad considered a malpractice case againstclass counsel in Ferguson v. Lief, Cabraser,Heiman & Bernstein LLP.11 However, the

issue presented in Ferguson was whether astipulated dismissal of punitive damages alle-gations as part of an $80 million class set-tlement constituted malpractice. The supremecourt held that lost punitive damages were notrecoverable as compensatory damages in alegal malpractice action, but the court did notanalyze the scope of class counsel’s duty tomembers of the class. Janik expressly stateswhat may have been implied in Ferguson—class counsel can be held liable for failing topursue claims on behalf of a class.

In addition to recognizing new potentialliability for class counsel, Janik also haspotentially broad implications for class actionsettlements. Commentators and courts haveexpressed concerns that class action settle-ments offer an opportunity for attorneys togenerate fees without any effective monitor-ing by class members, particularly when thesettlement has been reached prior to classcertification.12

There also is concern that defendants mayuse the settlements to buy their way out ofserious situations in a relatively nominal wayor to structure settlements to achieve a“tremendous sales bonanza” for themselveswhile providing little relief to the settlementclass.13 This criticism applies particularly tocoupon settlements, which require class mem-bers to redeem coupons for the defendant’sproducts in order to realize the benefits of thesettlement.

A new legal subspecialty has developed inrecent years: lawyers who make a living rep-resenting class members who challenge thesettlements of their class actions.14 Theseattorneys insist on modifications to settle-ment terms as well as fees for themselves inexchange for their clients’ decision to droptheir objections to final approval of the set-tlement. Clearly, “objecting has become bigbusiness.”15

Dealing with these objections can beextremely costly, particularly if the trial courtpermits discovery into the settlement processand the terms of the settlement.16 Litigatingchallenges to settlements delays finality fordefendants and usually puts a hold on anyaward for attorney’s fees. For that reason,defense counsel and class counsel regardobjectors and their lawyers as expensive nui-sances who threaten to derail settlementsthat required countless hours to achieve.

In their defense, settlement objectors oftenachieve beneficial modifications to class set-tlements or derail settlements that courts ulti-mately concluded were not in the interests ofthe class.17 In these cases, the objectors raiseissues that may not otherwise have been pre-sented to or considered by the trial court in rul-ing on a stipulated application for settlementapproval.18 Regardless of how one regards set-tlement objectors, they are here to stay.

24 Los Angeles Lawyer April 2005

Janik provides a new angle for attorneysseeking to challenge class action settlements.An argument that a proposed settlement is notfair and reasonable to the settlement classwould support a malpractice claim againstclass counsel as well as a direct challenge tothe settlement. There is no reason to think thatfuture class members—and the counsel whorepresent them—will not use Janik’s rationaleto challenge class settlements.

Protecting ClassSettlements fromAttack

There are many ways forcounsel to protect classsettlements from collat-eral attack. Of course,no single step—or even acombination of steps—will insulate a settlementfrom collateral attack orensure its approval.Ultimately, whether a set-tlement survives andclass counsel can avoidmalpractice liabilitydepends on the fairnessof the settlement to theclass.19 Class memberswill have no basis tocomplain if the settle-ment is fair and has notcaused the relinquish-ment of any substantiallegal rights without ade-quate justification. Thefollowing are effectiveways to enhance thechances of defeating anyattack on a class actionsettlement.

Use a mediator. Using amediator to oversee set-tlement negotiations addsa layer of protection for the interests of classmembers and thus undercuts a claim thatthe settlement was collusive. The trial judgemay feel more comfortable approving a set-tlement that has been mediated before a neu-tral third party, particularly if the mediator isone whom the trial judge knows and respects.Courts have cited the parties’ use of a medi-ator as a factor in finding that a class settle-ment was fair, reasonable, and not collusive.20

There are limits to how much mileage theparties can get from using a mediator.Declarations from the mediator describing themediation process or opining on the fairnessof the settlement may not be admissible in anysubsequent proceedings.21 Indeed, the medi-ator may not even be willing to provide sucha declaration. Even without a statement ofsupport from the mediator, the mere fact that

the parties submitted the matter to a respectedindependent mediator in itself is frequentlycited as a factor in favor of approving classsettlements.22

Negotiate fees after substantive terms.Whether the parties negotiate the settlementbetween themselves or retain a mediator, thesubstantive terms of the settlement—classdefinition, form and content of class notice,consideration to the class members, proce-

dures for redeeming consideration, andinjunctive relief (for example, requiringchanges in the defendant’s business prac-tices)—should be the first order of business.The issue of attorney’s fees should not beplaced on the table until after the substantiveterms have been resolved.

Attorney’s fees often are one of the mostcontroversial components of a class settle-ment, and a substantial stipulated fee awardcan provide a tempting target for settlementobjectors or malpractice plaintiffs attackingthe settlement as a sellout of the class byclass counsel. The mediator’s presence canundercut these arguments and underscorethe adversarial nature of the settlementprocess.

Waiting to negotiate class counsel’s feesuntil the substantive terms have been resolved

is often very difficult for defendants. Clientswant to know the bottom line, and in classaction settlements, the plaintiffs’ attorney’sfees award forms one of the most significantcomponents of the bottom line. Both sidesmay be reluctant to engage in protracted set-tlement discussions without addressing amaterial term. But rushing to deal with feesfirst or tying an agreement to substantiveterms to a particular fee award may expose

the settlement to chal-lenge (or at a mini-mum, close scrutiny bythe trial court).

Submitting thequestion of fees to thetrial court eliminatesany argument regard-ing collusion. While thetaint of collusion evap-orates, plaintiffs’ coun-sel and defense counseloften are unwilling toplace this importantissue entirely in thehands of a neutral thirdparty. In a settlement,defendants can captheir exposure for fees,but they have no suchassurances if they allowthe trial court to decidethe issue entirely.Conversely, class coun-sel may prefer the cer-tainty of knowing thatthe defendant will notoppose its fee requestto having to litigate itsentitlement to fees.

There are ways toreduce the risks to bothsides of submitting thefee issue to a third partyfor resolution. For

example, a baseball-style arbitration proce-dure may be appropriate. In this procedure,each side presents one number for consider-ation, and the judge or arbitrator must selectone of the two numbers. Alternatively, eachside could propose a number that forms therange between which the fee award will fall.If the trial court is unwilling to resolve theseissues, the matter could be referred to a thirdparty for determination. Regardless of theprocedure, placing the issue of fees into thehands of a third party makes it much moredifficult for an objector or malpractice plain-tiff to sell the argument that class counselbreached duties to the class in favor of theirown fees.

Don’t skimp on class notice. Preparing acomprehensive class notice can also protectthe settlement and class counsel from collat-

Los Angeles Lawyer April 2005 25

eral attack. Here is where defense counsel canbe helpful. Many defendants try to cut cor-ners on class notice to save potentially sub-stantial costs.23 Other defendants hope tominimize the response rate and thus reducethe ultimate payout. These are short-sightedconcerns that could threaten the settlement.

The notice is often the first and only timethe class receives any information about thecase or the settlement. Courts have adoptedflexible standards for determining whetherclass notice is adequate. In general, noticemust be given in a manner that has “a rea-sonable chance of reaching a substantial per-centage of the class members.”24 The noticeshould be as broad as possible to avoid sub-sequent charges that the class did not receiveadequate notice of the rights they were relin-quishing. The notice should be sent in a waythat is most likely to reach members of the set-tlement class.

Personal notice, if practicable, is alwaysthe best form of notice—both to satisfy dueprocess concerns and to insulate the settlementfrom collateral attack. Posting the notice ona company’s Web site or publishing the noticein newspapers or magazines have been rec-ognized as valid means of notice and may con-tribute to insulating a settlement from col-lateral attack.25

The contents of the notice are also impor-tant in avoiding subsequent challenges.“[N]otice given to class members must fairlyapprise members of the terms of the pro-posed compromise and of the options opento dissenting class members.”26 All classnotices briefly describe the nature of theaction and the settlement terms. In light ofJanik, settlement notices also should describeany claims that are not being pursued or thatthe class could pursue but for the settlement.If possible, the notice should set forth thereasons why these claims are not being pur-sued. Providing this detail will make anychallenge to the settlement more difficultbecause class members will have been advisedof the rights and claims that they relinquishedunder the settlement.

Involve the trial court in the process. Trialcourts—particularly judges in the complexcivil departments throughout the state—takean active role in class litigation to protectthe rights of absent class members. Courtoversight of settlements protects class mem-bers “whose rights may not have been givendue regard by the negotiating parties.”27 Thisaction by the court may provide an early lineof defense to any collateral attack on a classsettlement. In fact, the Janik court encouragedclass counsel to enlist the trial court to resolvequestions about the scope of its duties to theclass: “If class counsel has any question con-cerning the course that is required by theduty it owes to absent class members, the

attorneys may seek guidance from thecourt.”28 There is absolutely no reason not toheed that advice.

Parties should inform the trial court oftheir settlement negotiations and the para-meters of the settlement terms they are con-sidering. This approach brings the trial courtinto the settlement process—even if the trialjudge is not actually mediating the case—and may enhance the likelihood of approval.The judge may even spot issues that could pre-sent problems when the settlement is ready forapproval.

Some trial judges may be reluctant tooffer what might be regarded as advisoryrulings on matters that are not properly beforethem on a noticed motion or other recognizedprocedure. The federal Manual for ComplexLitigation suggests that on occasion “a judgemight retain a special master or a magistratejudge to examine issues regarding the valueof nonmonetary benefits to the class and theirfairness, reasonableness and adequacy,”29

although such appointments are rare.30

Trial courts are supposed to act as “fidu-ciaries” of absent class members.31 Disclosingthe reasons why counsel seeks guidance fromthe court and appealing to the court’s uniquerole as protector of the interests of absent classmembers may dispel some of the reluctanceof courts to get involved. Citing Janik alsomay be compelling. Concerns about the trialcourt’s willingness to provide settlement guid-ance should not, however, dissuade counselfrom making the inquiry. Counsel who refrainfrom asking for the trial judge’s help maynever know what the judge is thinking untilit is too late.

Request detailed findings from the trial court.Counsel should request specific findings fromthe trial court concerning the fairness of thesettlement, the adequacy of class counsel’s rep-resentation, the lack of collusion in the set-tlement process, and the decision not to pur-sue certain claims or forms of relief inexchange for the settlement. These findingscould be used in a subsequent action as col-lateral estoppel. Indeed, the Janik court sug-gested that such rulings could serve as a com-plete defense to a subsequent malpracticeaction: “If the issue on which the malpracticecomplaint is based has been considered anddetermined in the class action proceedings, therulings of the class action court will be bind-ing on the members of the class and precludereconsideration of those matters in anotherforum.”32

Of course, asserting this defense assumesthat the class action court made the requisitefindings. Existing class action procedures—both at the certification stage and the settle-ment stage—require courts to examine theadequacy of class counsel’s representation ofthe class. More often than not, the trial court’s

findings generally recite the requirements forsettlement approval without delving into spe-cific issues. That is perfectly understandablebecause most class settlement approval hear-ings proceed without opposition or objec-tion. Those general findings may not, how-ever, satisfy a subsequent court faced with amalpractice action against class counsel.

For that reason, class counsel should putthemselves in the shoes of an objector orpotential malpractice plaintiff and considerwhat aspects of the settlement might raise con-cerns in a subsequent collateral attack. Thoseissues should be presented to the trial courtin the settlement approval papers and at thepreliminary and final settlement approvalhearings. Draft final approval orders alsoshould include specific findings on these issues.

Encourage objectors to speak now or foreverhold their peace. Potential objectors often con-tact counsel to raise their concerns with a pro-posed settlement before filing formal objec-tions. It may be tempting for the proponentsof a class settlement to ignore these objectorsand hope they simply go away. The bettercourse is to insist that any objector submit for-mal objections to the trial court and appearat the final approval hearing.

Res judicata and collateral estoppel prin-ciples apply to judgments in class actioncases,33 including judgments that result fromclass actions settlements.34 Objectors whohave appeared and had their concerns con-sidered and addressed by the trial court in theunderlying class action case will have a dif-ficult time relitigating the same issues in a sub-sequent malpractice case.35 Indeed, the find-ings against them should serve as collateralestoppel and bar relitigation of those sameobjections in a subsequent action.36

Malpractice and Other Concerns

The appropriate response to a malpracticeaction filed before final approval of a class set-tlement is to seek an immediate stay or dis-missal of that action on the basis of anotheraction pending. While such a contempora-neously filed malpractice action likely is pre-mature, the case will ripen once judgment isentered approving the settlement. The trialcourt in the malpractice action should beapprised that counsel appears to be engagedin forum shopping and should be forced to lit-igate the concerns in the context of settlementapproval.

Most class settlements provide that thetrial court will retain jurisdiction over enforce-ment of the settlement. In light of Janik, pro-ponents of a class settlement should ask thetrial court to retain jurisdiction over collat-eral challenges to matters related to the set-tlement. That would provide a basis to trans-fer any subsequent malpractice case to thesame judge who approved the settlement in

26 Los Angeles Lawyer April 2005

the first place. The judge who found thatclass counsel adequately represented a set-tlement class and approved the settlementmay be much less inclined to allow a mal-practice action to proceed than a judge con-sidering the matter for the first time.

Janik is not merely a problem for theplaintiffs’ bar. It is undoubtedly tempting forthe defense bar to savor a case that exposestheir adversaries to lawsuits by disgruntledclients. This may seem to be a welcome pay-back for all of the times defense counsel hashad to deal with disgruntled clients com-plaining about the costs of class action liti-gation and settlements. Nonetheless, this viewis shortsighted. Any vehicle that opens thedoor to challenges to class action settlementsultimately will affect defense counsel and theclients they represent in class action settle-ments.

Another unintended impact of Janik maybe to increase class settlement demands.Plaintiffs’ counsel may seek to insulate them-selves from subsequent attacks by demandinghigher amounts in settlements and refusing toenter into settlements that do not providerelief to every class member. Coupon settle-ments, which many defendants like but whichhave been criticized by courts and commen-tators, may fall further out of favor becausetheir low redemption rates may leave largenumbers of class members with a reason tocomplain about the settlement.

Settling a class action lawsuit is nevereasy. Class counsel and defense counsel mustfirst deal with each other in contentious nego-tiations that often follow protracted litigation.They must face the trial court twice, first atthe preliminary approval hearing, then at thefinal approval hearing. During that process,they also may have to deal with objectors.Now, there is the possibility of contempora-neous or subsequent malpractice lawsuits.

Counsel negotiating class settlements owea duty to each other to make sure that the set-tlement is not subject to collateral attack.Working together to structure a settlementand a settlement process may ensure approvalof the settlement and insulate it from collat-eral attack. At the end of the day, no onewants to face the $90 million question. ■

1 Janik v. Rudy, Axelrod & Zieff, 119 Cal. App. 4th930 (2004).2 Bell v. Farmers Ins. Exch., 87 Cal. App. 4th 805(2001).3 Bell v. Farmers Ins. Exch., 115 Cal. App. 4th 715(2004).4 Janik, 119 Cal. App. 4th at 936.5 Id. at 941-42.6 Id. at 945-46.7 Cortez v. Purolator Air Filtration Prods. Co., 23Cal. 4th 163 (2000).8 Janik, 119 Cal. App. 4th at 946-47.9 Id. at 947.10 Since November 2, 2004, no discussion of the UCL

Los Angeles Lawyer April 2005 27

Anita Rae ShapiroSUPERIOR COURT COMMISSIONER, RET.

PRIVATE DISPUTE RESOLUTIONPROBATE, CIVIL, FAMILY LAW

PROBATE EXPERT WITNESS

TEL/FAX: (714) 529-0415 CELL/PAGER: (714) 606-2649E-MAIL: PrivateJudge@adr-shapiro.com

http://adr-shapiro.com

FEES: $300/hr

Coming this June in Los Angeles Lawyer

Lawyer-to-Lawyer Referral GuideFor listing or advertising information, call 213.896.6507

Deadline: April 25th

Officespace toshare inSouthBay

For information, call (310) 540 -1771 • $1,350 without phone or secretary

is complete without referring to Proposition 64—thevoter initiative that changed the previously broadstanding provisions under the UCL. With the passageof Proposition 64, plaintiffs must have suffered aninjury in fact as well as a loss of money or property inorder to sue a defendant for violation of the UCL.Proposition 64 also eliminated the ability of private par-ties to represent others unless the parties comply withclass action procedures. Practitioners should note thatProposition 64 actually makes Janik even more impor-tant in UCL litigation. Since class action procedures willapply to any UCL suit prosecuted on behalf of others,the duties articulated in Janik potentially apply to allsuits brought under the UCL.11 Ferguson v. Lief, Cabraser, Heiman & Bernstein LLP,30 Cal. 4th 1037 (2003).12 See Mars Steel Corp. v. Continental Ill. Nat’l Bank& Trust Co., 834 F. 2d 677, 678 (7th Cir. 1987)

(Judge Posner observed that class settlements, which areoften presented to the class as a fait accompli, pose sig-nificant problems for abuse because “lawyers for theclass, rather than the clients, have all the initiativeand are close to being the real parties in interest….”).13 In re General Motors Corp. Pick-Up Truck FuelTank Prods. Liab. Litig., 55 F. 3d 768, 787 (3d Cir.1995) (Third Circuit found that district court abusedits discretion in approving the class settlement because,among other reasons, the coupon settlement did notprovide adequate value to class members.).14 See Weissman v. Quail Lodge Inc., 179 F. 3d 1194(9th Cir. 1999). In Weissman, the Ninth Circuit reverseda district court order prohibiting an attorney fromobjecting to class action settlements. The district courtcharacterized the attorney as “something of a classaction settlement gadfly.” The Ninth Circuit reversedthe restrictive order on the ground that trial courts do

not have the power to sanction an attorney appearingon behalf of a client as a vexatious litigant. Id. at1196. See also In re Mexico Money Transfer Litig., 164F. Supp. 2d 1002 (N.D. Ill. 2001), aff’d, 267 F. 3d 743(7th Cir. 2001) (Dissident attorney who objected to set-tlement solicited more than 90% of all opt outs.).15 ALBA CONTE & HERBERT NEWBERG, 4 NEWBERG ON

CLASS ACTIONS §11.55, at 168 (4th ed. 2002).16 See In re General Motors Corp. Engine InterchangeLitig., 594 F. 2d 1106 (7th Cir. 1979) (holding that trialcourt abused its discretion by not permitting objectorsto conduct discovery to show that settlement prejudicedinterests of the class); see also 4 NEWBERG ON CLASS

ACTIONS, supra note 15, §11.57 (detailed discussion onan objector’s right to independent discovery).17 See General Motors Corp. Pick-Up Truck Fuel TankProds. Liab. Litig., 55 F. 3d 768.18 See Shaw v. Toshiba Am. Info. Sys., Inc., 91 F.Supp. 2d 942, 974-75 (E.D. Tex. 2000) (finding by dis-trict court that objectors’ counsel had conferred a sub-stantial benefit on the class by extending the couponredemption period from 180 days to one year).19 Officers for Justice v. Civil Serv. Comm’n, 688 F. 2d615, 625 (9th Cir. 1982). In class action litigation,California courts routinely look to federal authority forguidance. Vasquez v. Superior Court, 4 Cal. 3d 800,821 (1971).20 Wershba v. Apple Computer, Inc., 91 Cal. App.4th 224, 245 (2001).21 See Foxgate Homeowners Ass’n, Inc. v. BramaelaCal., Inc., 26 Cal. 4th 1 (2001) (holding that statementsfrom a mediator regarding a party’s conduct duringmediation proceeding were not admissible in connec-tion with a motion for sanctions).22 See Rebney v. Wells Fargo Bank, 220 Cal. App. 3d1117, 1139 (1990); Dunk v. Ford Motor Co., 48 Cal.App. 4th 1794 (1996).23 See, e.g., In re Lorazapem & Clorazepate AntitrustLitig., 205 F.R.D. 369 (D.D.C. 2002) (The courtreported total notice costs of $8.250 million for aclass that included more than 1.2 million members.).24 Cartt v. Superior Court, 50 Cal. App. 3d 960, 974(1975).25 Wershba, 91 Cal. App. 4th at 251 (upholding classnotice as adequate under circumstances in which defen-dant mailed or e-mailed notice to class members, pub-lished notice in USA Today and MacWorld, and postednotice for more than 30 days on its Internet Web site).26 Trotsky v. Los Angeles Fed. Sav. & Loan Ass’n, 48Cal. App. 3d 134, 151-52 (1975).27 Officers for Justice v. Civil Serv. Comm’n, 688 F. 2d615, 624 (9th Cir. 1982).28 Janik v. Rudy, Axelrod & Zieff, 119 Cal. App. 4th930, 946 (2004).29 MANUAL FOR COMPLEX LITIGATION, FOURTH 329(Federal Judicial Center 2004); available athttp://www.fjc.gov.30 THOMAS E. WILLGING ET AL., EMPIRICAL STUDY OF

CLASS ACTIONS IN FOUR FEDERAL DISTRICT COURTS 64-65 (Federal Judicial Center 1996).31 7-Eleven Owners for Fair Franchising v. SouthlandCorp., 85 Cal. App. 4th 1135, 1151 (2001).32 Janik, 119 Cal. App. 4th at 946.33 Daar v. Yellow Cab Co., 67 Cal. 2d 695, 706(1967); Payne v. National Collection Sys., Inc., 91Cal. App. 4th 1037, 1047 (2001).34 Citizens for Open Access to Sand & Tide, Inc. v.Seadrift Ass’n, 60 Cal. App. 4th 1053, 1065 (1998).35 See, e.g., Mortimer v. River Oaks Toyota, 278 Ill.App. 3d 597 (1996) (Plaintiffs who objected but did notopt out were subject to the preclusive effect of thejudgment in a settled class action.).36 See In re Bridgestone/Firestone, Inc. Tires Prods.Liab. Litig., 333 F. 3d 763 (7th Cir. 2003) (A findingthat nationwide class was inappropriate acted as col-lateral estoppel in state court proceedings.).

28 Los Angeles Lawyer April 2005