casemark/class-action-settlement

Class Action Settlement Agreement

Drafts a court-approvable class action settlement balancing class member interests, defendant finality, and FRCP 23(e) fairness standards.

Prerequisites

1. Case materials — complaint, class certification order, case number, jurisdictional details
2. Term sheet or negotiation record — agreed monetary amounts, allocation methodology, key terms
3. Class definition — certified or proposed class and any subclasses
4. Damages analysis — theories, calculations, aggregate and per-member ranges
5. Party information — all named parties, class representatives, counsel of record

Output Structure

Draft a formal settlement agreement with the following articles in order.

Article I — Recitals

| Element | Content | |---|---| | Litigation background | Case caption, court, claims asserted, procedural history | | Certification status | Class cert order date and scope, or proposed settlement class | | Settlement purpose | Compromise to avoid risk/expense; no admission of liability | | Negotiation history | Arms-length negotiation, mediator involvement if any |

Article II — Definitions

Define all capitalized terms at the outset. At minimum:

• Settlement Fund, Net Settlement Fund, Settlement Class, Class Period
• Released Claims, Released Parties, Effective Date
• Claims Administrator, Class Counsel, Class Representatives
• Claim Form, Opt-Out Deadline, Objection Deadline

Article III — Settlement Fund & Payment

• Total amount — non-reversionary common fund
• Payment schedule — deadlines, escrow/QSF account details
• Fee treatment — fund inclusive or exclusive of fees/costs
• Tax provisions — QSF treatment under IRC § 468B; each party bears own tax liability
• Investment — permitted investment pending distribution

Article IV — Class Definition & Release

• Class definition — mirror or refine certification order language
• Release scope — all asserted and unasserted claims arising from same facts/transactions
• Unknown claims waiver — Cal. Civ. Code § 1542 waiver or jurisdiction equivalent if applicable [VERIFY]
• Binding effect — binds all class members except valid opt-outs
• Released parties — entity, officers, affiliates, insurers

Article V — Allocation Plan & Claims Process

| Component | Requirements | |---|---| | Allocation formula | Objective methodology (pro rata, tiered by damages, claim strength) | | Claim form | Required fields, supporting documentation, submission methods | | Filing deadline | Minimum 60–90 days post-notice | | Validation | Administrator authority to accept/reject; deficiency cure period | | Dispute resolution | Process for contested claims | | Unclaimed funds | Cy pres distribution or pro rata reallocation — specify which |

Article VI — Fees, Costs & Incentive Awards

• Attorney's fees — maximum percentage or dollar cap; methodology (percentage-of-fund or lodestar cross-check)
• Litigation costs — reimbursement cap, subject to court approval
• Incentive awards — per-representative amount, subject to court approval
• All payments from Settlement Fund unless otherwise specified

Article VII — Notice Program

• Direct notice — mail and/or email to identifiable class members
• Publication notice — media outlets, internet, social media if appropriate
• Content — plain-language summary: terms, rights, deadlines, claim/opt-out/objection procedures
• Timeline — notice within __ days of preliminary approval
• Due process — must satisfy FRCP 23(c)(2)(B) or state equivalent

Article VIII — Opt-Out & Objection Procedures

| Procedure | Requirements | |---|---| | Opt-out | Written request; name, address, signature; postmarked by deadline | | Opt-out effect | Not bound by settlement or release; forfeits benefits | | Objections | Written; filed with court and served on counsel; must state basis | | Threshold walkaway | If opt-outs exceed __% of class, defendant may terminate |

Article IX — Court Approval & Contingencies

1. Preliminary approval — motion within __ days of execution
2. Fairness hearing — scheduled per court's order
3. Final approval — entry of final judgment and order
4. Termination rights — either party may withdraw if court denies approval or materially modifies terms
5. Effect of termination — revert to pre-settlement posture; inadmissible under FRE 408

Article X — General Provisions

• No admission of liability or wrongdoing
• Integration clause — supersedes all prior negotiations and agreements
• Amendments — material changes require court approval
• Governing law and jurisdiction
• Severability
• Counterparts and electronic signatures
• Non-disparagement (if negotiated)
• Confidentiality of negotiation communications

Signature Blocks & Exhibits

Signatures: all named defendants, class representatives, and counsel of record.

Exhibits:

• A: Proposed Class Notice (long form and summary)
• B: Claim Form
• C: Proposed Preliminary Approval Order
• D: Proposed Final Approval Order and Judgment

Guidelines

• Every provision must memorialize the agreement AND satisfy the court's duty to protect absent class members
• Release language: broad enough for defendant finality, not so overbroad the court rejects it
• Allocation methodology must be objectively defensible — courts scrutinize arbitrary distributions
• Notice plan must satisfy constitutional due process; err toward over-inclusion
• Non-reversionary fund strongly preferred — courts disfavor reversionary settlements
• Flag jurisdiction-specific requirements (e.g., state consumer protection notice rules, unknown claims waivers)
• All dollar amounts and deadlines must come from user-provided materials — never fabricate figures
• Mark unverified statutory citations with [VERIFY]