Thursday, February 20, 2014

A Double Secret Fee Application

Concepcion v. Amscan Holdings, No. B247832 (D2d7 Feb. 18, 2014)

This is an appeal of an attorneys fee award arising out of a settlement of five different class actions against the Party City stores for collecting zip code information. The parties agreed the class would get $300,000 in certificates for merchandise but did not agree to a fee award. Plaintiffs sought $350,000, which Party City opposed on the grounds that much of the work between the various plaintiff lawyers appeared duplicative. The trial court was initially inclined to agree with Party City, but invited the plaintiffs to submit supplemental information in camera. Plaintiffs took the invitation, after which the trial court approved the full award. Party City appealed. The court of appeal first holds, following the recent Ruiz decision, that Party City did not waive any right to appeal because the settlement agreement lacked clear waiver language. Furthermore, by relying on information filed in camera in approving the award, the trial court violated Party City’s right to due process. Although plaintiffs could have permissibly redacted their bills of privileged matters, the trial court was not free to base an attorneys fee award on information that Party City could not see, and thus could not contest.

Reversed and remanded.

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