Target Corp. v. Consumer (In re), 15-3909
| Decision Date | 13 June 2018 |
| Docket Number | No. 16-1408, No. 15-3912, No. 16-1245, No. 16-1203,No. 15-3909,15-3909 |
| Citation | 892 F.3d 968 |
| Parties | IN RE: TARGET CORPORATION CUSTOMER DATA SECURITY BREACH LITIGATION Jim Sciaroni, Objector-Appellant v. Consumer, Plaintiffs, Plaintiff-Appellee Target Corporation, Defendant-Appellee In re: Target Corporation Customer Data Security Breach Litigation Leif A. Olson, Objector-Appellant v. Consumer, Plaintiffs, Plaintiff-Appellee Target Corporation, Defendant-Appellee In re: Target Corporation Customer Data Security Breach Litigation Leif A. Olson, Objector-Appellant v. Consumer, Plaintiffs, Plaintiff-Appellee Target Corporation, Defendant-Appellee In re: Target Corporation Customer Data Security Breach Litigation Jim Sciaroni, Objector-Appellant v. Consumer, Plaintiffs, Plaintiff-Appellee Target Corporation, Defendant-Appellee In re: Target Corporation Customer Data Security Breach Litigation Leif A. Olson, Objector-Appellant v. Consumer, Plaintiffs, Plaintiff-Appellee Target Corporation, Defendant-Appellee |
| Court | U.S. Court of Appeals — Eighth Circuit |
Robert C. Black, III, Edina, MN, for Objector-Appellant Jim Sciaroni.
Felipe J. Arroyo, ROBBINS & ARROYO, San Diego, CA, Karl L. Cambronne, CHESTNUT & CAMBRONNE, P.A., David Michael Cialkowski, Brian C. Gudmundson, John Gordon Rudd, Jr., Charles S. Zimmerman, ZIMMERMAN & REED, Eleanor Michelle Drake, BERGER & MONTAGUE, Vincent J. Esades, David Woodward, HEINS & MILLS, Karen Riebel, LOCKRIDGE & GRINDAL, Minneapolis, MN, Norman Siegel, STUEVE & SIEGEL, Kansas City, MO, Ariana J. Tadler, MILBERG LAW FIRM, New York, NY, John A. Yanchunis, MORGAN & MORGAN, Tampa, FL, for Plaintiff-Appellee.
Michael J. Agoglia, San Francisco, CA, Fred B. Burnside, DAVIS & WRIGHT, Seattle, WA, Robert Gilmore Flanders, Jr., WHELAN & CORRENTE, Providence, RI, Patrick J. Kenny, ARMSTRONG & TEASDALE, Saint Louis, MO, Jack W. Londen, MORRISON & FOERSTER, Michelle Visser, ROPES & GRAY, San Francisco, CA, Douglas H. Meal, ROPES & GRAY, Boston, MA, Michael Allen Ponto, Wendy J. Wildung, FAEGRE & BAKER, Minneapolis, MN, Nancy R. Thomas, MORRISON & FOERSTER, Los Angeles, CA, for Defendant-Appellee.
Theodore H. Frank, Melissa Ann Holyoak, for Objector-Appellant Leif A. Olson.
Before BENTON and SHEPHERD, Circuit Judges, and STRAND, District Judge.1
This case is back to us after our reversal of the certification of a class composed of individuals whose payment card information was compromised as a result of the 2013 Target security breach. See In re Target Corp. Customer Data Sec. Breach Litig., 847 F.3d 608, 613 (8th Cir. 2017). On remand, the district court2 re-certified the class after conducting a rigorous analysis. Class member Leif Olson again objects to the certification on a number of grounds. In addition, class member Jim Sciaroni objects to the district court's approval of the settlement agreement. We see no error and affirm.
In 2015, the district court certified a class of "[a]ll persons in the United States whose credit or debit card information and/or whose personal information was compromised as a result of the data breach that was first disclosed by Target on December 19, 2013." As has become common, the class was certified solely for the purpose of entering into a settlement agreement. The parties presented such an agreement to the court in short order.
Under the terms of this agreement, Target agreed to pay $10 million to settle the claims of all class members and waived its right to appeal an award of attorney's fees less than or equal to $6.75 million.3 For those class members with documented proof of loss, the agreement called for full compensation of their actual losses up to $10,000 per claimant. For those class members with undocumented losses, the agreement directed a pro rata distribution of the amounts remaining after payments to documented-loss claimants and class representatives. Additionally, Target agreed to implement a number of data-security measures and to pay all class notice and administration expenses.
There were two primary objectors to the court's certification of the class and approval of the settlement agreement: Leif Olson and Jim Sciaroni. In the original appeal of this matter, Olson argued that the court failed to conduct the appropriate pre-certification analysis, and Sciaroni objected to the court's approval of the settlement. We agreed with Olson's argument and therefore remanded to the district court without considering Sciaroni's objections.
On remand, the court again certified the class. Olson appeals that decision, claiming the district court factually misunderstood the settlement agreement and failed to account for a number of alleged conflicts of interest between class counsel and class members and among competing subgroups of class members. In addition, Sciaroni's original objections to the settlement are before us. We first address Olson's claims before moving to Sciaroni's objections.
On appeal, Olson raises two principal challenges to the district court's certification order.4 First, he contends the district court fundamentally misunderstood the structure of the settlement agreement. Next, he argues that there is an intraclass conflict between class members who suffered verifiable losses from the data breach and those, like Olson, who have not, and that this conflict necessitates separate legal counsel.5 We address each argument in turn, applying the deferential abuse of discretion standard. See Petrovic v. Amoco Oil Co., 200 F.3d 1140, 1145 (8th Cir. 1999).
Olson first launches a factual challenge to the district court's order. Under the terms of the settlement, the proceeds are first distributed to those individuals who submit proof of actual loss, up to a total amount of $10,000 per claimant. Next, the class representative awards are paid. Then any remaining proceeds are distributed in equal amounts to those claimants with undocumented losses. The district court accurately presented this structure on page 3 of its order, but it later made two comments which form the basis of Olson's attack:
Proceeding from these statements, Olson contends the district court fundamentally misunderstood the settlement structure because it apparently believed that those claimants in the zero-loss subclass would receive a share of remaining settlement proceeds. Under Olson's view, "that error alone warrants reversal." We disagree.
To be sure, as Olson points out, we have stated that "[t]he district court ... abuses its discretion if its conclusions rest on clearly erroneous factual determinations." Blades v. Monsanto Co., 400 F.3d 562, 566 (8th Cir. 2005). But here we have no indication that the district court rested its conclusions on the above statements. In fact, the court had already determined that no intraclass conflict existed four pages prior to making the above statements, so it stretches credulity to assert that its conclusion depended on a statement made thereafter. We need not define at what point an erroneous factual statement constitutes reversible error. In this case, it was obvious that the district court did not rely on an erroneous understanding of the settlement, and thus no abuse of discretion occurred.
Olson next argues that there is an intraclass conflict between class members who suffered verifiable losses from the data breach and those, like Olson, who have not. Olson uses different names for this latter subclass, sometimes referring to it as a zero-recovery subgroup6 and other times calling it a future-damages subclass. In substance, Olson's contention is that under the Supreme Court's asbestos decisions in Amchem and Ortiz, the district court's ruling was legally deficient because, even assuming there were named representatives from the zero-loss subclass, separate legal counsel was required to protect that subclass's interests. See, e.g., Ortiz v. Fibreboard Corp., 527 U.S. 815, 856, 119 S.Ct. 2295, 144 L.Ed.2d 715 (1999) ().
We need look no further than the language of Amchem itself to refute this assertion.
Describing the then-current state of asbestos litigation, the Court noted:
[This] is a tale of danger known in the 1930s, exposure inflicted upon millions of Americans in the 1940s and 1950s, injuries that began to take their toll in the 1960s, and a flood of lawsuits beginning in the 1970s. On the basis of past and current filing data, and because of a latency period that may last as long as 40 years for some asbestos related diseases, a continuing stream of claims can be expected. The final toll of asbestos related injuries is unknown. Predictions have been made of 200,000 asbestos disease deaths before the year 2000 and as many as 265,000 by the year 2015.
Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 598, 117 S.Ct. 2231, 138 L.Ed.2d 689 (1997) (alteration in original) (internal quotation marks omitted). Against this backdrop, the Court was confronted with a class certification and settlement offer that "proposed to settle, and to preclude nearly all class members from...
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