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CONSUMER ADVOCATES OPPOSE ALLSTATE INSURANCE COMPANY'S EFFORTS TO HIDE ITS POST-KATRINA PAY-OUT PROCEDURESA Federal District Court judge in Miami today rejected a proposed class action settlement involving Sharper Image’s “Ionic Breeze” air purifiers, deeming it “a poor settlement with weak parties” – an opinion in concert with arguments made by Public Justice and other objectors in the case. The proposed settlement would have resolved the claims of over 3 million consumers nationwide that own Ionic Breeze air purifiers, which Consumer Reports has said are ineffective and pose serious health risks because of ozone emissions.
Under the denied settlement, Sharper Image would have provided a $19 coupon to customers who bought the Ionic Breeze machines. The coupons would have been redeemable toward the purchase of another Sharper Image product. The court agreed with the objectors’ position that the terms of the settlement itself were unfair. The court found that the coupon – the primary form of relief offered by the settlement – fails to disgorge “any wrongfully obtained gains.” The court concluded that the settlement, “in which Class Counsel receive close to $2 million in fees and class members are given a $19 coupon, is below the range of recovery in which a settlement of this case may be considered fair.” The proposal also gave class members the right to purchase a retrofit device called an “OzoneGuard,” but Public Justice and other objectors argued that the device was not shown to eliminate the adverse health effects associated with use of the Ionic Breeze and, in any case, did not fit all models. “We’re thrilled that the court has refused to approve a settlement that offered so little in value to consumers for purchasing these ineffective and allegedly hazardous Ionic Breeze machines,” said lead counsel Amy Radon, Public Justice’s Goldberg, Waters & Kraus Fellow. “The court agreed that the best interests of the class were not served by this settlement, and that the class deserves more in light of the millions of dollars Sharper Image has made from the sale of these machines.” In her 61-page order, Federal District Judge Cecilia M. Altonaga found, as Public Justice had urged on behalf of objecting class member La Sarmiento, that plaintiffs’ counsel had “necessarily negotiated from a position of weakness.” Public Justice and the other objectors had argued that, because a competing nationwide class action was poised to go to trial in California, class counsel in the Florida case were under strong pressure to settle on Sharper Image’s terms. The court agreed, and noted that various improvements the parties made to the settlement in the months prior to the fairness hearing were “the result of the strenuous and well-presented arguments of the objectors, rather than an informed arms-length negotiation process undertaken by well-positioned counsel.” Public Justice’s legal team consisted of Ms. Radon, Staff Attorney Leslie Brueckner, Executive Director Arthur Bryant, and cooperating counsel Theodore J. Leopold and Diana Martin of Ricci~Leopold in Palm Beach Gardens, Florida. Public Justice took the action as part of its Class Action Preservation Project. Public Justice’s objections and the amicus brief filed by more than two dozen Attorneys General opposing the settlement are available on the Public Justice website at http://www.publicjustice.net/briefs/SharperImage_Opinion_101107.pdf |
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