Lonardo v. Travelers Indem. Co

• Decision Date: 21 July 2010
• Docket Number: Case No. 1:06-CV-962.
• Citation: 706 F.Supp.2d 766
• Parties: Paul LONARDO, on behalf of himself and others similarly situated, and Dante Frezza, on behalf of himself and others similarly situated, and Joseph Feldman, on behalf of himself and others similarly situated, Plaintiffs,v.TRAVELERS INDEMNITY CO. et al., Defendants.
• Court: U.S. District Court — Northern District of Ohio

706 F.Supp.2d 766

Paul LONARDO, on behalf of himself and others similarly situated, and Dante Frezza, on behalf of himself and others similarly situated, and Joseph Feldman, on behalf of himself and others similarly situated, Plaintiffs,v.TRAVELERS INDEMNITY CO. et al., Defendants.

Case No. 1:06-CV-962.

United States District Court,

N.D. Ohio,

Eastern Division.

March 31, 2010.

Opinion Granting Reconsideration in Part July 21, 2010.

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Daniel P. Goetz, R. Eric Kennedy, Weisman, Kennedy & Berris, Cleveland, OH, Elizabeth J. Cabraser, Jahan C. Sagafi, Lieff, Cabraser, Heimann & Bernstein, San Francisco, CA, Ben F. Pierce Gore, Gore Law Firm, Los Gatos, CA, Charles Foose Barrett, Barrett Law Office, Nashville, TN, Dewitt M. Lovelace, Sr., Lovelace Law Firm, Destin, FL, John W. (aka Don) Barrett, Barrett Law Office, Lexington, MS, Morris A. Ratner, Lieff, Cabraser, Heimann & Bernstein, L.L.P., New York, NY, Randy Patchett, Patchett Law Office, Marion, IL, for Plaintiffs.

Arthur M. Kaufman, Cleveland, OH, Anthony T. Eliseuson, Donna J. Vobornik, Mark L. Hanover, Meghan E. Norton, Meghan E. Norton, Sonnenschein Nath & Rosenthal, Chicago, IL, for Defendants.

OPINION & ORDER

KATHLEEN McDONALD O'MALLEY, District Judge.

After nearly five years of remarkably contentious litigation, in September 2009 the parties reached a Settlement Agreement ¹ resolving all of the claims in this class action lawsuit. Now ripe and pending before the Court are two motions occasioned by this settlement: (1) Plaintiffs' Motion for Final Approval of Class Action Settlement and Incentive Award to Class Representatives (“Motion for Final Approval”) (Doc. 175); and (2) Motion for Order Granting Settlement Class Counsel's Petition for Award of Attorney Fees and Expenses (“Fee Petition”) (Doc. 176). For the reasons articulated below, both of these motions are GRANTED. Accordingly, the Court APPROVES the Settlement Agreement (Docs. 168, 190) and enters final judgment DISMISSING the case. Further, the Court AWARDS Class Counsel's fees and expenses in the amount requested, as calculated herein. Finally, the Court DENIES Mr. Greenberg's request for leave to file a petition for attorneys' fees (Doc. 191).

I. BACKGROUND

This is a case about homeowners insurance premiums. The Plaintiffs allege that the Defendant insurance companies sold consumers one homeowners insurance policy while unlawfully concealing the availability of a lower-priced policy that provided identical coverage and service. The Defendants admit that they sold identical policies at different prices, but have consistently denied, and continue to deny, that their conduct was unlawful in any way. The parties' Settlement Agreement fully resolves the case, so long as the Court deems it fair, reasonable, and adequate pursuant to Rule 23 of the Federal Rules of Civil Procedure. Consequently, the threshold issue now before the Court is whether the Settlement Agreement satisfies Rule 23.

On November 18, 2009, the Court issued an order certifying the Settlement Class pursuant Rule 23(b)(3) of the Federal Rules of Civil Procedure, ² preliminarily approving the Settlement Agreement, and approving procedures and forms relating to notice to class members, objections to the Settlement Agreement, and final approval. (Doc. 170.) As a result, the Court set the stage for the final act in this longstanding litigation-i.e., the Motion for Final Approval and consideration of Class Counsel's Fee Petition. The Plaintiffs provide a detailed and accurate history of the case leading up to this final act in their memorandum in support of final approval (Doc. 175 at 1-11 ³). The Court's summary of the case history below is based primarily on the Plaintiffs' detailed description in their briefs; the Court expressly incorporates that description into this Opinion & Order. Because, however, the Court's ruling with respect to the Motion for Final Approval and the Fee Petition is largely fact-specific, especially with respect to Class Counsel's conduct in pursuing their case, it is necessary to include some of the important details in the history of the case set forth below.

A. THE PLAYERS

For the sake of clarity, the following is a brief introduction to the key players in this litigation and the parties to the Settlement Agreement.

1. The Named Plaintiffs/Class Representatives

The named plaintiffs serve as class representatives for the class defined by the Settlement Agreement. As stated in the Court's November 18, 2009 Opinion & Order, “Paul Lonardo, Dante Frezza, and Joe Feldman are hereby appointed as the Settlement Class Representatives.” (Doc. 170 at 4.) ⁴ The Court will refer to Lonardo Frezza, and Feldman as “the Settlement Class Representatives” throughout this Opinion & Order. The Court will refer to the named plaintiffs and class representatives and the class they represented in the pre-settlement lawsuit as “the Plaintiffs.”

2. The Defendants

The named defendants in this case are: The Travelers Property Casualty Insurance Company, The Standard Fire Insurance Company, and The Travelers Indemnity Company. In addition, the following entities are not themselves named defendants, but are affiliated with the named defendants and signed-on to the Settlement Agreement: The Automobile Insurance Company of Hartford, CT, Travelers Property Casualty Insurance Company, Travelers Property Casualty Company of Illinois, The Phoenix Insurance Company, The Travelers Indemnity Company of Connecticut, and The Travelers Companies, Inc. For the sake of simplicity, all of these affiliated entities will be referred to throughout this Opinion & Order as “Travelers” or the “Settling Defendants,” or, where appropriate, the “Named Defendants.”

3. The Settlement Class

The definition of the class, as initially certified, is set forth in the Court's January 26, 2009 Opinion & Order, 259 F.R.D. 294, 300 (N.D.Ohio 2009). For settlement purposes, however, the parties agreed to the following definition of the “Settlement Class:”

“Class” or “Settlement Class” means, for settlement purposes only and for no other purpose: All persons in the United States who made an initial purchase of a homeowners insurance Class Policy (as that term is defined elsewhere) from a Settling Defendant for a property located in the states of Alabama, Arkansas, Colorado, Illinois, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, Ohio, South Carolina, and Tennessee, who are eligible to purchase Travelers homeowners insurance offering identical coverage and service, at a lower price, during the relevant “Class Period” for each respective state as set forth below. The precise “Class Policies” include only the policies described for the relevant time periods listed for each state in Exhibit B.... Excluded from the Class is any Class member who timely elects to be excluded from the Settlement Class, and all present and former agents of Defendants during the Class Period; all present and former employees of Defendants during the Class Period; and all members of the judiciary of the Court, and all members of their immediate families.

(Doc. 168 at 2-3 (omitting footnote).) ⁵ The Court certified the Settlement Class for settlement purposes in its November 18, 2009 Opinion & Order. (Doc. 170.)

4. Class Counsel

The Court appointed counsel for the Settlement Class in the November 18, 2009 Opinion & Order. (Doc. 170 at 4.) The Court appointed:

Don Barrett, Barrett Law Office, P.A.; Charles F. Barrett, Barrett & Associates, P.A.; Dewitt M. Lovelace, Lovelace Law Firm; R. Eric Kennedy and Daniel P. Goetz, Weisman, Kennedy & Berris Co., L.P.A.; Elizabeth J. Cabraser and Jahan C. Sagafi, Lieff, Cabraser, Heimann & Bernstein, LLP; John R. Patchett, Patchett Law Office Thomas Thrash, Thrash Law Firm, and Pierce Gore, Gore Law Firm.

(Doc. 168 at 3.) Each of these attorneys and/or their law firms have submitted an affidavit in support of their Fee Petition. (Doc. 176, Exs. A-G.)

5. The Objectors

Nine objections were asserted in response to the notice of the Settlement Agreement.⁶ Class member Daniel Greenberg's objection (Doc. 173) encompasses the substantive and colorable arguments asserted in all of the other objections. Mr. Greenberg is represented by attorney Theodore H. Frank of the non-profit law firm The Center for Class Action Fairness. Mr. Frank filed a brief on behalf of Mr. Greenberg articulating his objections to the Settlement Agreement. ( Id.) He also appeared at the Final Fairness Hearing and presented oral argument in support of Mr. Greenberg's objections. (Tr. of Final Fairness Hrg., Doc. 188 at 37-57.)

B. THE UNDERLYING LITIGATION

While the claims at the heart of this litigation are rather nuanced, the Plaintiffs essentially allege that Travelers sells identical homeowners insurance policies at multiple prices, concealing the availability of lower-priced policies that offer identical coverage and service to identically qualified customers. The Plaintiffs allege that Travelers' practice of charging multiple prices for identical coverage of the exact same risk constituted, among other things, fraudulent concealment and unjust enrichment. The Plaintiffs' case evolved in three progressive stages, each of which is identifiable by the named plaintiff.

1. The Zangara Case

The first case in the trilogy was Vincent Zangara, et al. v. Travelers Indemnity Company of America, Case No. 1:05cv731 (N.D.Ohio) (O'Malley, J.), which Class Counsel filed on March 14, 2005. The Zangara complaint alleged that a Travelers affiliate sold the plaintiffs a “homeowners insurance policy without disclosing to them the availability of a less expensive Travelers homeowners policy offering identical coverage and policyholder service.” Zangara, Case No. 1:05cv731, Doc. 2, ¶ 12. A year later, after substantial discovery and briefing regarding a motion to dismiss filed by Travelers and regarding class certification, Class...