Chapter § 5.14 The Preliminary Hearing

• Jurisdiction: United States
• Publication year: 2020

§ 5.14 The Preliminary Hearing

As discussed in section 5.13(1), at the preliminary approval stage, the court examines materials the parties submit to determine whether it is likely to find that the proposed settlement terms are “fair, reasonable, and adequate.”³⁰⁸ Some courts hold a preliminary approval hearing, while others do not. In the latter case, courts may find, especially when no class members object, that the “parties’ briefings” are “suitable for determination without a preliminary hearing.”³⁰⁹ Although the court must conduct a “rigorous inquiry” at the final approval stage, “to grant preliminary approval, the court must now consider whether it “will likely be able to: (i) approve the proposal under Rule 23(e)(2); and (ii) certify the class for purposes of judgment on the proposal.”³¹⁰

[1] Filing a Statement for the Proposed Settlement

The Federal Rules don’t provide specific guidance on the information parties must include in a submission for a proposed class action settlement. Rule 23(e)(1)(A) simply states that the “parties must provide the court with information sufficient to enable it to determine whether to give notice of the proposal to the class.”³¹¹ In other words, the parties must provide information to persuade the court that (i) the proposed settlement is fair considering the factors in Rules 23(e)(2) (and any fairness factors developed by case law) and (ii) the class can be certified for settlement purposes under Rule 23(a) and 23(b) where the class has not already been certified.³¹² Therefore, in practice, motions requesting that the court preliminarily approve a proposed settlement should track the fairness factors in one section of the filing and the requirements of Rules 23(a) and 23(b) in a separate section.³¹³

Also, Rule 23(e)(3) directs the parties to “file a statement identifying any agreement made” regarding the settlement.³¹⁴ A Pocket Guide for Judges suggests the court also require the parties to “provide the full settlement agreement as well as an informative summary of other agreements, such as settlement agreements for claims similar to those of class members; side understandings about attorney fees; and agreements about filing future cases, sealing of discovery, and the like.”³¹⁵

[2] Appointment of Advisors

While the court must decide whether to preliminarily approve a settlement, it can appoint “an adjunct: a magistrate judge, guardian ad litem, special master, court-appointed expert, or technical advisor, to help...