Federal Court Approves Diamond Walnuts Settlement

A federal court in California has given final approval to the $2.6 million settlement of a class action alleging that Diamond Foods falsely represented that the omega-3 in its walnuts provides health benefits. Zeisel v. Diamond Foods, Inc., No. 10-01192 (N.D. Cal., decided October 16, 2012). Additional information about the case appears in Issue 436 of this Update.

While additional claims may be filed by class members until October 26, as of September 7, more than 23,000 class members had submitted claims, and they have been submitted at a rate of about 1,000 each week. The court issued its ruling after the parties provided supplemental briefing on the cy pres issue. Under the unpublished final disposition, the court indicated that any residual funds will be provided to the American Heart Association, which “provides education on issues relating to heart healthy food, including education about how to read food labels.”

The court approved the request for attorney’s fees and costs representing
about 30 percent of the settlement amount and a $5,000 incentive payment
to the named plaintiff. Diamond will be required to change its product
labels and website. According to the court, only one person opted out of
the proposed settlement, and no objections were filed. It concluded that the
agreement was “fair, reasonable, and adequate.”