MDL Court Approves $24 Million Contaminated Pet Food Settlement
A multidistrict litigation (MDL) court in New Jersey has entered an order approving the settlement of claims that pet food contaminated with melamine and cyanuric acid sickened and killed thousands of cats and dogs in the United States. In re Pet Food Prods. Liab. Litig., MDL No. 1950 (D.N.J., filed November 18, 2008). In its 65-page opinion, the court certified the class for settlement purposes and approved an award of $24 million to the plaintiffs and nearly $6.4 million in attorney’s fees. The court also denied a motion to intervene, overruled several objections and granted a motion to strike a separate motion for attorney’s fees.
Pet owners will be eligible for documented economic damages, such as veterinary bills, cremation, burial services, costs of new pets, and healthy pet screenings. Claims without documentation will be paid up to a maximum of $900 for each claimant. If the claims exceed the available funds, the payments “will be subject to a pro rata reduction.” Of the $24 million, $250,000 is set aside for reimbursement of product purchases, and $400,000 is available for health screenings. Any undistributed funds will be used as a charitable contribution “to
animal welfare-related organizations both in the United States and Canada.” The defendants that manufactured the recalled pet foods, without conceding liability, “agreed to continue to administer their internal quality assurance programs to regularly test shipments of raw wheat gluten and rice protein concentrate imported from China for the presence of melamine and cyanuric acid until May 30, 2009.”
The intervenors are involved in pending false-advertising litigation involving pet food not contaminated or recalled, but just labeled “Made in
the United States.” The court found that their claims were not released by the settlement. Objectors involved in litigation alleging that marketing pet food as healthy, premium or human grade was false and misleading because such pet food products allegedly contained “nonedible garbage, by-products and waste that is unfit for human consumption,” were also denied relief because the court was satisfied
that the MDL release did not encompass all of their claims. Other objectors sought criminal and punitive sanctions, testing of pet food in perpetuity, stronger enforcement of safety regulations, emotional damages, and future damages. The court noted its inability to provide some of this relief or its unavailability as a matter of law.
The court determined that the settlement was fair, reasonable and adequate and that attorney’s fees equal to 25 percent of the settlement fund, plus reimbursement of expenses of nearly $400,000, were reasonable. The court decided that one law firm’s motion for attorney’s fees was premature because co-lead counsel were responsible for allocating fees, and the firm had not submitted documentation in support of its claim. “Thus, their objection that they anticipate not being fairly compensated is premature.” The settlement applies to the more than 100 class actions filed in federal court and transferred to the MDL court; as of the end of September 2008 some 9,300 class members from the United States and Canada had submitted claims, with 115 opting out and 28 objecting.
