Understanding Class Action Settlement Administration

Understanding Class Action Settlement Administration In an effort to look for ways that will benefit our subscribers with new interests, www.lawyersandsettlements.com recently spoke with the president of an up-and-coming firm, Class Action Administration (CAA), Inc. CAA specializes in assisting attorneys with all phases of class action cases. CAA's tag line "Comprehensive Services, Excellent Results," along with its satisfaction guarantee, sparked this article. Class Action Administration, Inc. (CAA) Matthew Pohl founded Class Action Administration Inc. (CAA) with the desire to deliver exceptional service to attorneys involved in class actions. We asked Mr. Pohl how exactly, attorneys can benefit from CAA's services. "Class Action Administration does exactly what our name says -- we administer class action settlements," says Pohl, president and founder. "CAA's main role is to act as an independent third party that makes sure the terms of the settlement are implemented. The class administrator helps ensure class members are being properly notified of their legal rights, that claims are being fairly processed --as well as handling communications from the members of the class - and that the settlement benefits are calculated based on the settlement terms," says Pohl. "It is amazing that we have already handled cases with nearly a million class members without a warehouse full of people," says Pohl. "We have strategic relationships with key vendors that allow us to handle large projects without having to increase our internal staff. This of course, helps to keep costs down. For example, we teamed with firms specialized in printing and mailing at a very high quality level and low price. To maintain high level of service, CAA does not outsource claims processing and contact with class members, since that is the core of what we do. CAA chooses to not off-shore any of our work; we are continually looking to team up with vendors that are US based." Matthew Pohl answers questions from www.lawyersandsettlements.com. How did you get started in this business? Before starting my own company in 1999, I worked for Arthur Andersen, which at that time was the world's largest accounting and consulting company. I managed a team of professionals in Arthur Andersen's litigation consulting practice. During my tenure, I focused on expert work involving complex litigation, including class actions utilizing my statistics and information systems background to develop damage models, calculation methods and data analysis. Some of the most challenging projects involved the management of several class settlements that had millions of class members. Do you have competition? There are a handful of large competitors in the US. But our clients say CAA is unique in our responsiveness and attention to detail, and in the way we take ownership of a project, giving the clients the comfort that CAA will "take care of the project." How do you measure success? As a class administrator, we have an obligation not only to the court and both parties, but also to the members of the class. Success isn't necessarily measured in the response rates or in maximizing the amount of money paid out. Success means implementing the best notice plan practicable, processing claims in a timely and accurate manner, class members being able to reach us directly and getting their questions answered, and benefits being paid quickly. Success also entails that both parties are comfortable that we have implemented the terms of the settlement in a fair and unbiased manner. When should an attorney contact a class administrator? Most attorneys wait until after the preliminary settlement is final to contact the class administrator. Unfortunately, by that time most of the rules and terms that the members of the class have to follow are already set. This keeps the class administrator from being fully able to use his or her experience to design a more efficient administration process. I recommend initial contact with a class administrator be done while settlement discussions are still underway. CAA's "Pre-Settlement Consulting Services" help the parties determine the best approach for settlement administration. This process helps minimize costs, ensures a comprehensive claims process, and speeds up the disbursement of benefits. Do attorneys have to hire a class administrator? Attorneys typically hire a class administrator once a class action researches preliminary settlement. Some firms try to administer the case themselves. But many firms find that class settlement administration is a lot more complex than the firm can handle. Additionally, having counsel perform the administration internally takes away the independence that a third party administrator brings. Are there regulations regarding how many, or a percentage, of class members you have to contact? The federal rules require that all class members are to be notified via the best practicable manner, which is imperative to how the notice plan is created by the parties and the class administrator. Actual rates of notification can vary based on how easily the members of the class can be identified. How is the method of notifying potential class members determined? Prior to the settlement, CAA works with the parties to determine the best approach in notifying class members. The particular circumstances of the case will determine what approaches are available. For example, if the class members are subscribers to a service, it is likely that a complete list of class members is available. In that case, a direct notice mailing would likely be used. To contrast, there was a case CAA administered where no centralized list of class members existed, and many of the distributors were no longer in business. In this case, it was difficult to notify each class member individually, so a mixture of published notice in various magazines and newspapers were used. What makes class members more likely to participate? My experience shows that response rates are impacted by several factors including: • How comprehensively class members are notified • The class member's perception of the value of the settlement • The simplicity of filing a claim Class response rates vary dramatically. We have administered classes that have seen response rates as low as 10 percent and as high as 95 percent. How long does the administration of class settlement take? As the class administrator, we try to make a smooth and quick transition for both our clients and class members from litigation phase to settlement administration. A typical claims administration project lasts six to nine months, although it can also span several years, depending upon terms of the settlement. What unique approaches does CAA use in administering settlements? CAA is always looking for ways to improve our services. For example, we have used post card notices that direct class members to a web site for detailed case information, which substantially reduced notice costs. We also use e-mail as a means to provide notice. CAA has used GIS technology for cases that are geographically focused, such as environmental cases. This allows us to have precise information on the class and allows us to accurately process claims and calculate benefits. Finally, all of our projects are database-driven. Our proprietary claims processing database provides us the flexibility to meet the specific needs of each case and does not require us to force a given project into a pre-set process. What is this "satisfaction guarantee" about on your web site? We wanted to let potential clients know that we stand by our promise to deliver exceptional service. We also wanted to highlight the fact that we are located in Colorado. So we offer something unique to CAA,; if a client is not satisfied with our service, we will pay for our client and a guest to spend a weekend in our beautiful state of Colorado. That's a win-win proposition! To find more about CAA visit www.classactionadmin.com Matthew Pohl, President, Class Action Administration, Inc.: 720-540-4422 / 866-540-4422 Denver, Colorado mpohl@classactionadmin.com [www.ClassActionAdmin.com]