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In re Hyundai And Kia Fuel Economy Litigation

United States Court of Appeals, Ninth Circuit

June 6, 2019

In re Hyundai and Kia Fuel Economy Litigation,
v.
Caitlin Ahearn; Andrew York, Objectors-Appellants. Kehlie R. Espinosa; Nicole Marie Hunter; Jeremy Wilton; Kaylene P. Brady; Gunther Krauth; Eric Graewingholt; Reece Philip Thomson; Alex Maturani; Nilufar Rezai; Jack Rottner; Lydia Kievit; Rebecca Sanders; Bobby Brandon Armstrong; Sergio Torres; Richard Woodruff; Marshall Lawrence Gordon; Joel A. Lipman; James Gudgalis; Mary P. Hoessler; Stephen M. Hayes; Brian Reeves; Sam Hammond; Mark Leggett; Edwin Naythons; Michael Washburn; Ira D. Dunst; Brian Weber; Kamneel Maharaj; Kim Iocovozzi; Herbert J. Young; Linda Hasper; Leslie Bayard; Tricia Fellers; Orlando Elliott; James Bonsignore; Margaret Setser; Guillermo Quiroz; Douglas Kurash; Andres Carullo; Laura S. Sutta; Georgia L. Thomas; Eric J. Olson; Jennifer Myers; Tom Woodward; Jerold Terhost; Cameron John Cestaro; Donald Brown; Maria Figueroa; Constance Martyn; Thomas Ganim; Daniel Baldeschi; Lillian E. Levoff; Giuseppina Roberto; Robert Trader; Sean Goldsberry; Cynthia Navarro; Owen Chapman; Michael Brein; Travis Brissey; Ronald Burkard; Adam Cloutier; Steven Craig; John J. Dixson; Erin L. Fanthorpe; Eric Hadesh; Michael P. Keeth; John Kirk MacDonald; Michael Mandahl; Nicholas McDaniel; Mary J. Moran-Spicuzza; Gary Pincas; Brandon Potter; Thomas Purdy; Rocco Renghini; Michelle Singlteon; Ken Smiley; Gregory M. Sonstein; Roman Starno; Gayle A. Stephenson; Andres Villicana; Richard Williams; Bradford L. Hirsch; Ashley Cephas; David E. Hill; Chad McKinney; Mordechai Schiffer; Lisa Sands; Donald Kendig; Kevin Gobel; Eric Larson; Lin McKinney; Ryan Cross; Phillip Hoffman; Debra Simmons; Abelardo Morales; Peter Blumer; Carolyn Hammond; Melissa Leggett; Kelly Moffett; Evan Grogan; Carlos Medina; Alberto Dominguez; Catherine Bernard; Michael Breien; Laura Gill; Thomas Schille; Judith Stanton; Randy Rickert; Bryan Zirkel; James Kundrat; Robert Smith; Maria Kotova; Josipa Casey; Luan Snyder; Ben Baker; Brian Nguyen; Hattie Williams; Bill Holvey; Lourdes Vargas; Kendall Snyder; Nomer Medina; Sameria Goff; Ursula Pyland; Marcell Chapman; Kaye Kurash; Holly Amromin; John Chapman; Mary D'Angelo; George Rudy; Ayman Mousa; Shelly Henderson; Jeffrey Hathaway; Dennis J. Murphy; Douglas A. Patterson; John Gentry; Linda Ruth Scott; Danielle Kay Gilleland; Joseph Bowe; Michael Desouto, Plaintiffs-Appellees, Greg Direnzo, Petitioner-Appellee, Hyundai Motor America; Kia Motors America; Kia Motors Corporation; Grossinger Autoplex, Inc., FKA Grossinger Hyundai; John Krafcik; Hyundai Motor Company; Sarah Kundrat, Defendants-Appellees, In re Hyundai and Kia Fuel Economy Litigation, Kehlie R. Espinosa; Nicole Marie Hunter; Jeremy Wilton; Kaylene P. Brady; Gunther Krauth; Eric Graewingholt; Reece Philip Thomson; Alex Maturani; Nilufar Rezai; Jack Rottner; Lydia Kievit; Rebecca Sanders; Bobby Brandon Armstrong; Sergio Torres; Richard Woodruff; Marshall Lawrence Gordon; Joel A. Lipman; James Gudgalis; Mary P. Hoessler; Stephen M. Hayes; Brian Reeves; Sam Hammond; Mark Leggett; Edwin Naythons; Michael Washburn; Ira D. Dunst; Brian Weber; Kamneel Maharaj; Kim Iocovozzi; Herbert J. Young; Linda Hasper; Leslie Bayard; Tricia Fellers; Orlando Elliott; James Bonsignore; Margaret Setser; Guillermo Quiroz; Douglas Kurash; Andres Carullo; Laura S. Sutta; Georgia L. Thomas; Eric J. Olson; Jennifer Myers; Tom Woodward; Jerold Terhost; Cameron John Cestaro; Donald Brown; Maria Figueroa; Constance Martyn; Thomas Ganim; Daniel Baldeschi; Lillian E. Levoff; Giuseppina Roberto; Robert Trader; Sean Goldsberry; Cynthia Navarro; Owen Chapman; Michael Brein; Travis Brissey; Ronald Burkard; Adam Cloutier; Steven Craig; John J. Dixson; Erin L. Fanthorpe; Eric Hadesh; Michael P. Keeth; John Kirk MacDonald; Michael Mandahl; Nicholas McDaniel; Mary J. Moran-Spicuzza; Gary Pincas; Brandon Potter; Thomas Purdy; Rocco Renghini; Michelle Singlteon; Ken Smiley; Gregory M. Sonstein; Roman Starno; Gayle A. Stephenson; Andres Villicana; Richard Williams; Bradford L. Hirsch; Ashley Cephas; David E. Hill; Chad McKinney; Mordechai Schiffer; Lisa Sands; Donald Kendig; Kevin Gobel; Eric Larson; Lin McKinney; Ryan Cross; Phillip Hoffman; Debra Simmons; Abelardo Morales; Peter Blumer; Carolyn Hammond; Melissa Leggett; Kelly Moffett; Evan Grogan; Carlos Medina; Alberto Dominguez; Catherine Bernard; Michael Breien; Laura Gill; Thomas Schille; Judith Stanton; Randy Rickert; Bryan Zirkel; James Kundrat; Robert Smith; Maria Kotova; Josipa Casey; Luan Snyder; Ben Baker; Brian Nguyen; Hattie Williams; Bill Holvey; Lourdes Vargas; Kendall Snyder; Nomer Medina; Sameria Goff; Ursula Pyland; Marcell Chapman; Kaye Kurash; Holly Amromin; John Chapman; Mary D'angelo; George Rudy; Ayman Mousa; Shelly Henderson; Jeffrey Hathaway; Dennis J. Murphy; Douglas A. Patterson; John Gentry; Linda Ruth Scott; Danielle Kay Gilleland; Joseph Bowe; Michael Desouto, Plaintiffs-Appellees, Greg Direnzo, Petitioner-Appellee, Hyundai Motor America; Kia Motors America; Kia Motors Corporation; Grossinger Autoplex, Inc., FKA Grossinger Hyundai; John Krafcik; Hyundai Motor Company; Sarah Kundrat, Defendants-Appellees,
v.
Antonio Sberna, Objector-Appellant. In re Hyundai and Kia Fuel Economy Litigation, Kehlie R. Espinosa; Nicole Marie Hunter; Jeremy Wilton; Kaylene P. Brady; Gunther Krauth; Eric Graewingholt; Reece Philip Thomson; Alex Maturani; Nilufar Rezai; Jack Rottner; Lydia Kievit; Rebecca Sanders; Bobby Brandon Armstrong; Sergio Torres; Richard Woodruff; Marshall Lawrence Gordon; Joel A. Lipman; James Gudgalis; Mary P. Hoessler; Stephen M. Hayes; Brian Reeves; Sam Hammond; Mark Leggett; Edwin Naythons; Michael Washburn; Ira D. Dunst; Brian Weber; Kamneel Maharaj; Kim Iocovozzi; Herbert J. Young; Linda Hasper; Leslie Bayard; Tricia Fellers; Orlando Elliott; James Bonsignore; Margaret Setser; Guillermo Quiroz; Douglas Kurash; Andres Carullo; Laura S. Sutta; Georgia L. Thomas; Eric J. Olson; Jennifer Myers; Tom Woodward; Jerold Terhost; Cameron John Cestaro; Donald Brown; Maria Figueroa; Constance Martyn; Thomas Ganim; Daniel Baldeschi; Lillian E. Levoff; Giuseppina Roberto; Robert Trader; Sean Goldsberry; Cynthia Navarro; Owen Chapman; Michael Brein; Travis Brissey; Ronald Burkard; Adam Cloutier; Steven Craig; John J. Dixson; Erin L. Fanthorpe; Eric Hadesh; Michael P. Keeth; John Kirk MacDonald; Michael Mandahl; Nicholas McDaniel; Mary J. Moran-Spicuzza; Gary Pincas; Brandon Potter; Thomas Purdy; Rocco Renghini; Michelle Singlteon; Ken Smiley; Gregory M. Sonstein; Roman Starno; Gayle A. Stephenson; Andres Villicana; Richard Williams; Bradford L. Hirsch; Ashley Cephas; David E. Hill; Chad McKinney; Mordechai Schiffer; Lisa Sands; Donald Kendig; Kevin Gobel; Eric Larson; Lin McKinney; Ryan Cross; Phillip Hoffman; Debra Simmons; Abelardo Morales; Peter Blumer; Carolyn Hammond; Melissa Leggett; Kelly Moffett; Evan Grogan; Carlos Medina; Alberto Dominguez; Catherine Bernard; Michael Breien; Laura Gill; Thomas Schille; Judith Stanton; Randy Rickert; Bryan Zirkel; James Kundrat; Robert Smith; Maria Kotova; Josipa Casey; Luan Snyder; Ben Baker; Brian Nguyen; Hattie Williams; Bill Holvey; Lourdes Vargas; Kendall Snyder; Nomer Medina; Sameria Goff; Ursula Pyland; Marcell Chapman; Kaye Kurash; Holly Amromin; John Chapman; Mary D'angelo; George Rudy; Ayman Mousa; Shelly Henderson; Jeffrey Hathaway; Dennis J. Murphy; Douglas A. Patterson; John Gentry; Linda Ruth Scott; Danielle Kay Gilleland; Joseph Bowe; Michael Desouto, Plaintiffs-Appellees, Greg Direnzo, Petitioner-Appellee, Hyundai Motor America; Kia Motors America; Kia Motors Corporation; Grossinger Autoplex, Inc., FKA Grossinger Hyundai; John Krafcik; Hyundai Motor Company; Sarah Kundrat, Defendants-Appellees,
v.
Peri Fetsch, Objector-Appellant. In re Hyundai and Kia Fuel Economy Litigation, Kehlie R. Espinosa; Nicole Marie Hunter; Jeremy Wilton; Kaylene P. Brady; Gunther Krauth; Eric Graewingholt; Reece Philip Thomson; Alex Maturani; Nilufar Rezai; Jack Rottner; Lydia Kievit; Rebecca Sanders; Bobby Brandon Armstrong; Sergio Torres; Richard Woodruff; Marshall Lawrence Gordon; Joel A. Lipman; James Gudgalis; Mary P. Hoessler; Stephen M. Hayes; Brian Reeves; Sam Hammond; Mark Leggett; Edwin Naythons; Michael Washburn; Ira D. Dunst; Brian Weber; Kamneel Maharaj; Kim Iocovozzi; Herbert J. Young; Linda Hasper; Leslie Bayard; Tricia Fellers; Orlando Elliott; James Bonsignore; Margaret Setser; Guillermo Quiroz; Douglas Kurash; Andres Carullo; Laura S. Sutta; Georgia L. Thomas; Eric J. Olson; Jennifer Myers; Tom Woodward; Jerold Terhost; Cameron John Cestaro; Donald Brown; Maria Figueroa; Constance Martyn; Thomas Ganim; Daniel Baldeschi; Lillian E. Levoff; Giuseppina Roberto; Robert Trader; Sean Goldsberry; Cynthia Navarro; Owen Chapman; Michael Brein; Travis Brissey; RonaldBurkard; Adam Cloutier; Steven Craig; John J. Dixson; Erin L. Fanthorpe; Eric Hadesh; Michael P. Keeth; John Kirk MacDonald; Michael Mandahl; Nicholas McDaniel; Mary J. Moran-spicuzza; Gary Pincas; Brandon Potter; Thomas Purdy; Rocco Renghini; Michelle Singlteon; Ken Smiley; Gregory M. Sonstein; Roman Starno; Gayle A. Stephenson; Andres Villicana; Richard Williams; Bradford L. Hirsch; Ashley Cephas; David E. Hill; Chad McKinney; Mordechai Schiffer; Lisa Sands; Donald Kendig; Kevin Gobel; Eric Larson; Lin Mckinney; Ryan Cross; Phillip Hoffman; Debra Simmons; Abelardo Morales; Peter Blumer; Carolyn Hammond; Melissa Leggett; Kelly Moffett; Evan Grogan; Carlos Medina; Alberto Dominguez; Catherine Bernard; Michael Breien; Laura Gill; Thomas Schille; Judith Stanton; Randy Rickert; Bryan Zirkel; James Kundrat; Robert Smith; Maria Kotova; Josipa Casey; Luan Snyder; Ben Baker; Brian Nguyen; Hattie Williams; Bill Holvey; Lourdes Vargas; Kendall Snyder; Nomer Medina; Sameria Goff; Ursula Pyland; Marcell Chapman; Kaye Kurash; Holly Amromin; John Chapman; Mary D'angelo; George Rudy; Ayman Mousa; Shelly Henderson; Jeffrey Hathaway; Dennis J. Murphy; Douglas A. Patterson; John Gentry; Linda Ruth Scott; Danielle Kay Gilleland; Joseph Bowe; Michael Desouto, Plaintiffs-Appellees, Greg Direnzo, Petitioner-Appellee, Hyundai Motor America; Kia Motors America; Kia Motors Corporation; Grossinger Autoplex, Inc., FKA Grossinger Hyundai; John Krafcik; Hyundai Motor Company; Sarah Kundrat, Defendants-Appellees,
v.
Dana Roland, Objector-Appellant. In re Hyundai and Kia Fuel Economy Litigation, Kehlie R. Espinosa; Nicole Marie Hunter; Jeremy Wilton; Kaylene P. Brady; Gunther Krauth; Eric Graewingholt; Reece Philip Thomson; Alex Maturani; Nilufar Rezai; Jack Rottner; Lydia Kievit; Rebecca Sanders; Bobby Brandon Armstrong; Sergio Torres; Richard Woodruff; Marshall Lawrence Gordon; Joel A. Lipman; James Gudgalis; Mary P. Hoessler; Stephen M. Hayes; Brian Reeves; Sam Hammond; Mark Leggett; Edwin Naythons; Michael Washburn; Ira D. Dunst; Brian Weber; Kamneel Maharaj; Kim Iocovozzi; Herbert J. Young; Linda Hasper; Leslie Bayard; Tricia Fellers; Orlando Elliott; James Bonsignore; Margaret Setser; Guillermo Quiroz; Douglas Kurash; Andres Carullo; Laura S. Sutta; Georgia L. Thomas; Eric J. Olson; Jennifer Myers; Tom Woodward; Jerold Terhost; Cameron John Cestaro; Donald Brown; Maria Figueroa; Constance Martyn; Thomas Ganim; Daniel Baldeschi; Lillian E. Levoff; Giuseppina Roberto; Robert Trader; Sean Goldsberry; Cynthia Navarro; Owen Chapman; Michael Brein; Travis Brissey; Ronald Burkard; Adam Cloutier; Steven Craig; John J. Dixson; Erin L. Fanthorpe; Eric Hadesh; Michael P. Keeth; John Kirk MacDonald; Michael Mandahl; Nicholas McDaniel; MARY J. Moran-Spicuzza; Gary Pincas; Brandon Potter; Thomas Purdy; Rocco Renghini; Michelle Singlteon; Ken Smiley; Gregory M. Sonstein; Roman Starno; Gayle A. Stephenson; Andres Villicana; Richard Williams; Bradford L. Hirsch; Ashley Cephas; David E. Hill; Chad McKinney; Mordechai Schiffer; Lisa Sands; Donald Kendig; Kevin Gobel; Eric Larson; Lin McKinney; Ryan Cross; Phillip Hoffman; Debra Simmons; Abelardo Morales; Peter Blumer; Carolyn Hammond; Melissa Leggett; Kelly Moffett; Evan Grogan; Carlos Medina; Alberto Dominguez; Catherine Bernard; Michael Breien; Laura Gill; Thomas Schille; Judith Stanton; Randy Rickert; Bryan Zirkel; James Kundrat; Robert Smith; Maria Kotova; Josipa Casey; Luan Snyder; Ben Baker; Brian Nguyen; Hattie Williams; Bill Holvey; Lourdes Vargas; Kendall Snyder; Nomer Medina; Sameria Goff; Ursula Pyland; Marcell Chapman; Kaye Kurash; Holly Amromin; John Chapman; Mary D'angelo; George Rudy; Ayman Mousa; Shelly Henderson; Jeffrey Hathaway; Dennis J. Murphy; Douglas A. Patterson; John Gentry; Danielle Kay Gilleland; Joseph Bowe; Michael Desouto, Plaintiffs-Appellees, Greg Direnzo, Petitioner-Appellee, Hyundai Motor America; Kia Motors America; Kia Motors Corporation; Grossinger Autoplex, Inc., FKA Grossinger Hyundai; John Krafcik; Hyundai Motor Company; Sarah Kundrat, Defendants-Appellees.
v.
Linda Ruth Scott, Objector-Appellant. In re Hyundai and Kia Fuel Economy Litigation, John Gentry; Linda Ruth Scott; Danielle Kay Gilleland; Joseph Bowe; Michael Desouto, Plaintiffs, and James Ben Feinman, Appellant,
v.
Hyundai Motor America; Kia Motors America; Kia Motors Corporation; Grossinger Autoplex, Inc., FKA Grossinger Hyundai; John Krafcik; Hyundai Motor Company; Sarah Kundrat, Defendants-Appellees.

          Argued and Submitted En Banc September 27, 2018 Pasadena, California

          Appeal from the United States District Court for the Central District of California D.C. No. 2:13-ml-02424- GW-FFM George H. Wu, District Judge, Presiding.

          James B. Feinman (argued), James B. Feinman & Associates, Lynchburg, Virginia, for Appellants James Ben Feinman, John Gentry, Linda Ruth Scott, Danielle Kay Gilleland, Joseph Bowe, Michael Desouto.

          George W. Cochran (argued), Streetsboro, Ohio; Edward W. Cochran, Shaker Heights, Ohio; John J. Pentz, Sudbury, Massachusetts; for Appellants Caitlin Ahearn and Andrew York.

          Steve A. Miller, Steve A. Miller P.C., Denver, Colorado, for Appellant Antonio Sberna. Matthew Kurilich, Tustin, California, for Appellant Peri Fetsch. Dennis D. Gibson, Gibson Law Firm, Dallas, Texas, for Appellant Dana Roland.

          Elaine S. Kusel (argued), Basking Ridge; Richard D. McCune, McCuneWright LLP, Redlands, California; for Appellees Kehlie R. Espinosa, Lilian E. Levoff, Thomas Ganim, and Daniel Baldeschi.

          Benjamin W. Jeffers, Dommond E. Lonnie, James S. Azadian, and Brian H. Newman, Dykema Gossett LLC, Los Angeles, California, for Appellees Kia Motors America Inc. and Kia Motors Corp.

          Shon Morgan (argued) and Joseph R. Ashby, Quinn Emanuel Urquhart & Sullivan LLP, Los Angeles, California; Karin Kramer, Quinn Emanuel Urquhart & Sullivan LLP, San Francisco, California; Dean Hansell, Hogan Lovells LLP, Los Angeles, California; for Appellees Hyundai Motor America and Hyundai Motor Co.

          Robert B. Carey and John M. DeStefano, Hagens Berman Sobol Shapiro LLP, Phoenix, Arizona, for Appellees Kaylene P. Brady and Nicole Marie Hunter.

          Christopher E. Appel, Philip S. Goldberg, and Cary Silverman, Shook Hardy & Bacon LLP, Washington, D.C., for Amici Curiae Association of Global Automakers and American Tort Reform Association.

          Katherine I. McBride, Jason L. Lichtman, and Jonathan D. Selbin, Lieff Cabraser Heimann & Bernstein LLP, New York, New York; Elizabeth J. Cabraser, Roger N. Heller, and Michael W. Sobol, Lieff Cabraser Heimann & Bernstein LLP, San Francisco, California; for Amici Curiae Public Justice, National Association of Consumer Advocates, National Consumer Law Center, and The Impact Fund.

          Ryan H. Wu and Glenn Danas, Capstone Law APC, Los Angeles, California; Mark S. Greenstone and Jonathan M. Rotter, Glancy Prongay & Murray LLP, Los Angeles, California; for Amici Curiae Hon. Stephen G. Larson (Ret.) and Professor David Rosenberg.

          Before: Sidney R. Thomas, Chief Judge; and Andrew J. Kleinfeld, William A. Fletcher, Marsha S. Berzon, Johnnie B. Rawlinson, Jay S. Bybee, Milan D. Smith, Jr., Sandra S. Ikuta, Morgan Christen, Jacqueline H. Nguyen, and Andrew D. Hurwitz, Circuit Judges.

         SUMMARY[*]

         Class Action / Attorneys' Fees

         The en banc court affirmed the district court's orders and judgment certifying a nationwide settlement class, approving a settlement, and awarding attorneys' fees in a multidistrict litigation brought against Hyundai Motor America and Kia Motors America regarding alleged misrepresentations about their vehicles' fuel economy.

         Objectors challenged the certification order and fee awards on various grounds, and the en banc court found none of them persuasive.

         Concerning the objectors' challenge to the district court's findings regarding the predominance of common factual or legal issues under Fed.R.Civ.P. 23(b)(3), the en banc court held that the district court did not abuse its discretion in finding that common issues predominated. Specifically, the en banc court held that: the inclusion of used car purchasers in the class did not defeat predominance; variations in state law did not defeat predominance; objectors failed to meet their burden of showing that California law did not apply; and application of California law satisfied due process.

         The en banc court rejected the objectors' challenges to the adequacy of class counsel.

         Concerning the objectors' challenges to the settlement approval, the en banc court held that: the notice to class members provided sufficient information; the claim forms were not overly burdensome; and there was no evidence of collusion between class counsel and the automakers. The en banc court held that the district court properly exercised its discretion in calculating the fee award using the lodestar method.

         The en banc court held that the district court did not abuse its discretion in denying fees to objector's counsel James Feinman because he did not meaningfully contribute to the class settlement.

         Judge Ikuta dissented because she would hold that the district court certified a multistate class action under Fed.R.Civ.P. 23 without determining what law applied to the plaintiffs' claims, in violation of Rule 23 and Supreme Court precedent, Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997). Judge Ikuta also stated that the majority erred in upholding the district court's award of attorneys' fees, because the district court failed to determine the value of the benefit the class derived from the settlement.

          OPINION

          NGUYEN, Circuit Judge.

         We review five consolidated appeals from the district court's orders and judgment certifying a nationwide settlement class, approving a settlement, and awarding attorney's fees in a multidistrict litigation brought against defendants Hyundai Motor America and Kia Motors America (the "automakers") regarding alleged misrepresentations about their vehicles' fuel economy. After extensive litigation, the lead plaintiffs' counsel ("class counsel") and the automakers (collectively, the "settling parties") negotiated a settlement that the district court approved following eight months of confirmatory discovery. Objectors challenged the certification order and fee awards on various grounds. Finding none of them persuasive, we affirm.

         I. Factual and Procedural Background

         On January 6, 2012, class counsel McCuneWright, LLP filed the first of the putative nationwide class actions, Espinosa v. Hyundai Motor America, No. 12-cv-800 (C.D. Cal.). The Espinosa plaintiffs brought claims against Hyundai under California consumer protection statutes and theories of common law fraud and negligent misrepresentation. They alleged that Hyundai misled consumers throughout the United States by advertising inflated fuel economy standards for the Hyundai Elantra and Sonata vehicle model years 2011-12 based on inaccurate estimates that Hyundai provided to the Environmental Protection Agency ("EPA"). After several motions to dismiss, amendments to the complaint, and class discovery, including document production, depositions, and expert reports, the Espinosa plaintiffs moved to certify a nationwide litigation class of purchasers of Hyundai Elantra and Sonata vehicles.

         In November and December 2012, the district court held hearings on the contested class certification motion in Espinosa. Although the court issued a tentative ruling declining to certify a nationwide litigation class in light of potentially "material differences" among state laws, it requested supplemental briefing and "did not make a final ruling."

         On November 2, 2012, less than four weeks before the Espinosa class certification hearing, the automakers issued a press release announcing downward adjustments to the EPA fuel economy estimates for certain of their 2011 through 2013 model year vehicles. Partially in response to an EPA investigation, the automakers created a Lifetime Reimbursement Program ("Reimbursement Program") to compensate owners and lessees of these vehicles for the higher fuel costs associated with the revised fuel economy estimates.

         The automakers' announcement sparked a surge of litigation. At the time, Espinosa and one other putative class action were the only cases pending against the automakers regarding misrepresentations and omissions in their fuel-economy disclosures and advertisements. After the announcement, several similar lawsuits were filed in state and federal courts around the country, including two, Hunter v. Hyundai Motor America, No. 12-cv-1909 (C.D. Cal. filed Nov. 2, 2012), and Brady v. Hyundai Motor America, No. 12-cv-1930 (C.D. Cal. filed Nov. 6, 2012), brought by class co-counsel Hagens Berman Sobol Shapiro, LLP, and three in Virginia brought by attorney James B. Feinman. The federal cases were consolidated into a single multidistrict litigation ("MDL") in the Central District of California before the Honorable George H. Wu. See 28 U.S.C. § 1407.

         Meanwhile, Hyundai and the plaintiffs in Espinosa, Brady, and Hunter attended multiple mediation sessions with a mediator whom the district court found to be "respected and experienced." On February 14, 2013, the parties announced a proposed nationwide settlement for Hyundai vehicles affected by the fuel economy restatement. Kia joined this settlement-in-principle shortly thereafter.

         The district court appointed liaison counsel to act on behalf of the plaintiffs not participating in the Espinosa, Brady, and Hunter cases (the "non-settling plaintiffs") and to participate in confirmatory discovery so that the non-settling plaintiffs could objectively evaluate the terms of the settlement. Confirmatory discovery lasted eight months and produced 300, 000 pages of documents and under-oath interviews of the automakers' employees, including Hyundai's CEO. Liaison counsel filed status reports with updates on the progress of confirmatory discovery and the non-settling plaintiffs' positions, and the court held several status conferences to discuss issues that arose.

         On December 23, 2013, the settling parties sought preliminary approval of the nationwide class settlement and moved to certify a settlement class. The district court ordered multiple rounds of briefing concerning the fairness of the settlement, sufficiency of the class notice, the claims process, class certification, choice of law, and other issues. At four hearings held between December 2013 and August 2014, the parties addressed concerns raised by the court sua sponte as well as by objectors and other non-settling plaintiffs. In response to these concerns, the settling parties twice revised the settlement agreement and notice provisions.

         After issuing several detailed written rulings, the district court granted preliminary approval of the settlement and certified the class for settlement purposes on August 29, 2014. The court appointed Hagens Berman and McCuneWright as settlement class counsel. In September and October 2014, the district court held four additional hearings, at which it requested that the parties make additional changes to the settlement notices and website, such as adding information about the Reimbursement Program, and rewording the notices to make them easier to understand.

         The amended settlement provided for class members to be notified of the settlement in four ways: (1) a short form notice by mail; (2) an email notification; (3) settlement websites with the long form notice; and (4) flyers provided by dealers. The settlement defined the class as all current and former owners and lessees who bought or leased certain defined vehicles on or before November 2, 2012-the date that Defendants announced they were revising the EPA fuel economy estimates of certain Hyundai and Kia vehicles.

         Class members could receive compensation for relinquishing any claims they might have by choosing one of four options:

1. a lump sum payment via a debit card, determined by vehicle type and model year, with the cash value approximating the additional fuel cost over a 4.75-year period associated with the revised fuel economy estimates;
2. a dealer service debit card worth 150% of the value of their lump sum payment for use at Hyundai or Kia dealers;
3. a new car purchase certificate worth 200% of their lump sum payment for use in the purchase of a new Hyundai or Kia vehicle by a class member or their immediate family; or
4. enrollment in the Reimbursement Program, which was extended as a result of the settlement from December 31, 2013, to July 6, 2015.

         As it had before the settlement, the Reimbursement Program provided recurring payments over the entire period of ownership based on the updated fuel economy estimates, the number of miles driven, and the price of gas in each geographic region, plus a 15% bonus for the inconvenience. Class members already participating in the Reimbursement Program could continue to participate and, in addition, receive a $100 or $50 lump sum payment depending on whether their vehicles were owned or leased.

         The class notice websites, which the district court tested, offered an online calculator for class members to estimate the benefit that they would receive through the Reimbursement Program as compared with the lump sum payment options. Class members could submit their claims online where the form would pre-populate with the class members' information after they entered their vehicle identification number and the unique identification number contained in their class notices.

         By the end of March 2015, with more than three months to go before the July 6, 2015, claims deadline, the automakers reported to the district court that the total compensation they had paid or expected to pay to the class members, based on the claims submitted, was more than $140 million. The Reimbursement Program accounted for more than $97 million of this compensation. By May 31, 2015, more than a month before the claims deadline, the participation rate had grown to 23.0%, reflecting 200, 013 claims. And when the court included class members' participation in the Reimbursement Program in the analysis, the participation rate jumped to 64.5%.

         In July 2014, one month before the settlement received preliminary approval, class counsel began negotiating with the automakers over a fee award, assisted by the same experienced mediator who had helped them reach the settlement agreement. In October 2014, they reached an agreement, pursuant to which class counsel moved for an award of fees.

         The district court expressed concern with the request by McCuneWright for a 3.0 lodestar multiplier. On June 1, 2015, after supplemental briefing and an additional hearing, the court awarded McCuneWright $2, 850, 000 in attorney's fees and $93, 550.02 in costs based on a reduced multiplier of 1.5521. On August 5, 2015, the court awarded Hagens Berman, class counsel in Hunter and Brady, $2, 700, 000 in attorney's fees based on a lodestar multiplier of 1.22, and $250, 000 in costs. In addition, the court awarded fees and costs to 26 other firms that reflected lodestar reductions of 27 to 80 percent, including an award of $1, 257, 000 in fees and $66, 000 in costs to liaison counsel Girard Gibbs LLP. The court declined to award fees to Feinman for his representation of the objecting plaintiffs in the three Virginia cases, finding that he "did not meaningfully contribute to the class settlement" and that his "mostly meritless" objections "did not serve to increase the settlement amount or otherwise benefit the class members."

         On June 11, 2015, after more than three years of litigation, including eight months of confirmatory discovery, the court issued a 19-page order granting final approval of the class settlement. Various objectors appealed the district court's orders certifying the class, approving the settlement, and awarding attorney's fees. A divided three-judge panel of this court vacated the class certification decision and remanded, holding that by failing to analyze the variations in state law, the district court abused its discretion in certifying the settlement class. See In re Hyundai & Kia Fuel Econ. Litig., 881 F.3d 679 (9th Cir. 2018). A majority of the nonrecused active judges on our court voted to rehear the case en banc.

         II. Jurisdiction and Standards of Review

         The district court had jurisdiction under 28 U.S.C. § 1332(a) and (d). We have jurisdiction under 28 U.S.C. § 1291.[1]

         In light of the "strong judicial policy that favors settlements, particularly where complex class action litigation is concerned," Allen v. Bedolla, 787 F.3d 1218, 1223 (9th Cir. 2015) (quoting In re Syncor ERISA Litig., 516 F.3d 1095, 1101 (9th Cir. 2008)), we perform an "extremely limited" review of a district court's approval of a class settlement, In re Bluetooth Headset Prods. Liab. Litig., 654 F.3d 935, 940 (9th Cir. 2011) (quoting In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 458 (9th Cir. 2000)). Parties seeking to overturn the settlement approval must make a "strong showing" that the district court clearly abused its discretion. Linney v. Cellular Alaska P'ship, 151 F.3d 1234, 1238 (9th Cir. 1998) (quoting Class Plaintiffs v. Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992)). As long as the district court applied the correct legal standard to findings that are not clearly erroneous, we will affirm. Bluetooth Headset, 654 F.3d at 940.

         We review for abuse of discretion the district court's decision to certify a class for settlement purposes, limiting our review "to whether the district court correctly selected and applied Rule 23's criteria." Parra v. Bashas', Inc., 536 F.3d 975, 977 (9th Cir. 2008). Likewise, we review for abuse of discretion the district court's award of attorney's fees and costs to class counsel as well as its method of calculating the fees. In re Online DVD-Rental Antitrust Litig., 779 F.3d 934, 942 (9th Cir. 2015). The factual findings underlying these decisions are reviewed for clear error. See Torres v. Mercer Canyons Inc., 835 F.3d 1125, 1132 (9th Cir. 2016) (certification); Bluetooth Headset, 654 F.3d at 940 (fees).

         III. Discussion

         A. Certification

         Before certifying a class, the district court must assure itself that the proposed class action satisfies four prerequisites:

(1) the class is so numerous that joinder of all members is impracticable;
(2) there are questions of law or fact common to the class;
(3) the claims or defenses of the representative parties are typical of the claims or defenses of the class; and
(4) the representative parties will fairly and adequately protect the interests of the class.

Fed. R. Civ. P. 23(a). In addition to meeting the numerosity, commonality, typicality, and adequacy prerequisites, the class action must fall within one of the three types specified in Rule 23(b). Here, the district court certified the class under Rule 23(b)(3), which requires that "questions of law or fact common to class members" must "predominate over any questions affecting only individual members," and the class action must be "superior to other available methods for fairly and efficiently adjudicating the controversy." Fed.R.Civ.P. 23(b)(3). The district court's Rule 23(a) and (b) analysis must be "rigorous." Comcast Corp. v. Behrend, 569 U.S. 27, 33 (2013) (quoting Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 (2011)).

         The criteria for class certification are applied differently in litigation classes and settlement classes. In deciding whether to certify a litigation class, a district court must be concerned with manageability at trial. However, such manageability is not a concern in certifying a settlement class where, by definition, there will be no trial. On the other hand, in deciding whether to certify a settlement class, a district court must give heightened attention to the definition of the class or subclasses. Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 620 (1997). The Supreme Court specifically addressed the difference between litigation and settlement classes in Amchem. The Court wrote:

Confronted with a request for settlement-only class certification, a district court need not inquire whether the case, if tried, would present intractable management problems, see Fed. Rule Civ. Proc. 23(b)(3)(D), for the proposal is that there be no trial. But other specifications of the Rule-those designed to protect absentees by blocking unwarranted or overbroad class definitions-demand undiluted, even heightened, attention in the settlement context. Such attention is of vital importance, for a court asked to certify a settlement class will lack the opportunity, present when a case is litigated, to adjust the class, informed by the proceedings as they unfold.

         We addressed concerns about definitions of settlement classes and fairness of proposed settlements in Hanlon v. Chrysler Corp., 150 F.3d 1011, 1021 (9th Cir. 1998):

District courts must be skeptical of some settlement agreements put before them because they are presented with a "bargain proffered for . . . approval without benefit of an adversarial investigation." [Amchem, 521 U.S. at 621].
These concerns warrant special attention when the record suggests that settlement is driven by fees; that is, when counsel receive a disproportionate distribution of the settlement, or when the class receives no monetary distribution but class counsel are amply rewarded.

         In the case before us, however, we need not analyze all of those criteria, for objectors challenge only the district court's findings regarding the predominance of common factual or legal issues under Rule 23(b)(3) and adequacy of ...


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