Class Action Settlements—Cy Pres Awards

Frank v. Gaos, No. 17-961

Federal Rule of Civil Procedure 23(e) authorizes district courts to approve class action settlements only when the terms of the settlement are “fair, reasonable, and adequate.” In this case, the parties agreed to settle the plaintiffs’ privacy claims on behalf of a class of 129 million individuals. Rather than distribute $5.3 million in settlement funds among the class, who, the district court held, had not pleaded any concrete harm—the parties agreed to distribute the funds to six privacy organizations. The Court granted certiorari to determine whether and under what circumstances courts may authorize so-called cy pres awards in class action settlements. Mayer Brown is among counsel for the respondents.