3 4 5 pro hac vice CHIMICLES TIKELLIS LLP 361 W. Lancaster … · 2013-11-25 · No. 10-CV-01610 PLAINTIFFS’ NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF SETTLEMENT AGREEMENT

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Jeffrey L. Fazio (146043) ([email protected]) Dina E. Micheletti (184141) ([email protected]) FAZIO | MICHELETTI LLP 2410 Camino Ramon, Suite 315 San Ramon, CA 94583 T: 925-543-2555 F: 925-369-0344 Steven A. Schwartz (pro hac vice) ([email protected]) Timothy N. Mathews (pro hac vice) ([email protected]) CHIMICLES & TIKELLIS LLP 361 W. Lancaster Avenue Haverford, PA 19041 T: 610-642-8500 F: 610-649-3633 Interim Co-Lead Class Counsel Anthony F. Fata (pro hac vice pending) Daniel O. Herrera (pro hac vice pending) CAFFERTY CLOBES MERIWETHER & SPRENGEL LLP 30 N. LaSalle, Suite 3200 Chicago, IL 60602 T: 312-782-4880 F: 312-782-4485 Proposed State Plaintiffs Liaison Counsel (Additional Counsel Listed at End of Document)

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IN RE APPLE iPHONE/iPOD WARRANTY LITIGATION This Document Relates to All Actions

No. 10-CV-01610 PLAINTIFFS’ NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF SETTLEMENT AGREEMENT

DATE: TBD TIME: TBD COURTROOM: 3 Hon. Richard G. Seeborg

Case3:10-cv-01610-RS Document75 Filed05/28/13 Page1 of 57

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TABLE OF CONTENTS PAGE

NOTICE OF MOTION............................................................................................. vii

I. INTRODUCTION............................................................................................ 1

II. BACKGROUND .............................................................................................. 9

A. APPLE’S STANDARD AND EXTENDED WARRANTIES ................................. 9

B. APPLE’S FORMER LIQUID DAMAGE POLICY ............................................ 9 C. APPLE CHANGED ITS FORMER LIQUID DAMAGE POLICY, BUT DID NOT COMPENSATE CUSTOMERS WHOSE WARRANTY CLAIMS WERE DENIED PURSUANT TO APPLE’S FORMER LIQUID DAMAGE POLICY ........................................................ 11 D. PLAINTIFFS FILE THE LAWSUITS THAT WERE ULTIMATELY CONSOLIDATED BEFORE THIS COURT, AND AGREE TO COORDINATE THEIR LITIGATION EFFORTS ........................................... 12

E. SUMMARY OF ISSUES IN DISPUTE ......................................................... 13 F. DISCOVERY EFFORTS............................................................................ 15 1. Experts ..................................................................................... 15

2. Discovery From Apple ............................................................. 15

3. Discovery from Uncooperative Third Parties......................... 17

G. MEDIATION, FURTHER FORMAL DISCOVERY, MORE NEGOTIATIONS AND INFORMAL DISCOVERY ............................... 18 H. POST SETTLEMENT DISCOVERY AND DRAFTING THE SETTLEMENT AGREEMENT ............................................................ 20 I. SETTLEMENT BENEFITS FOR CLASS MEMBERS .................................... 21 J. ATTORNEYS’ FEES, COSTS, AND INCENTIVE AWARDS ........................... 23

K. ALLOCATION OF THE NET SETTLEMENT FUND ..................................... 25

III. ARGUMENT.................................................................................................. 26

A. THE CRITERIA THAT APPLY TO PRELIMINARY APPROVAL..................... 26 B. THE PROPOSED SETTLEMENT IS ENTITLED TO A PRESUMPTION OF FAIRNESS BECAUSE IT IS THE PRODUCT OF ARMS’-LENGTH, INFORMED, NONCOLLUSIVE NEGOTIATION BY EXPERIENCED COUNSEL .......................................... 29


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1. The Settlement Has No Obvious Deficiencies........................ 30

2. The Settlement Does Not Improperly Grant Preferential Treatment to Class Representatives or Segments of the Settlement Class ........................................................... 30 3. The Terms of the Proposed Settlement are Fair Reasonable and More Than Adequate ..................... 31

C. THE COURT SHOULD CERTIFY THE SETTLEMENT CLASS...................... 35

1. Numerosity is Satisfied ........................................................... 35

2. Commonality is Satisfied ........................................................ 36

3. Typicality is Satisfied .............................................................. 37 4. Adequacy of Representation is Satisfied ................................ 37 5. Predominance is Satisfied ....................................................... 39 6. Superiority is Satisfied............................................................ 39

D. CLASS COUNSEL SATISFY THE REQUIREMENTS OF RULE 23(G) ............ 41 E. THE PROPOSED NOTICE PLAN SATISFIES DUE PROCESS AND WARRANTS APPROVAL ............................................ 41 F. THE PARTIES WILL PROPOSE A SCHEDULE FOR THE

EVENTS LEADING UP TO THE FINAL FAIRNESS HEARING ..................... 47

IV. CONCLUSION .............................................................................................. 47


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TABLE OF AUTHORITIES

Cases

Adoma v. Univ. of Phoenix, Inc., 2012 WL 6651141 (E.D. Cal. Dec. 20, 2012) ...................................................28 Amchem Prods. v. Windsor, 521 U.S. 591 (1997) ....................................................................................35, 39 Amgen, Inc. v. Connecticut Retirement Plans and Trust Funds, 133 S.Ct. 1184 (2013) .......................................................................................39 Bellows v. NCO Fin. Sys., Inc., 2008 WL 5458986 (S.D. Cal. Dec. 10, 2008)....................................................28 Cellphone Termination Fee Cases, 180 Cal. App. 4th 1110 (2009) .........................................................................28 Cotton v. Hinton, 559 F.2d 1326 (5th Cir. 1977) ..........................................................................28 Dennis v. Kellogg Co., 697 F.3d 858 (9th Cir. 2012) ............................................................................23 Durham v. Cont’l Cent. Credit, Inc., 2011 WL 90253 (S.D. Cal. Jan. 10, 2011)........................................................28 Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974) ..........................................................................................42 Fraley v. Facebook, Inc., 2012 WL 5838198 (N.D. Cal. Aug. 17, 2012) ................................. 4, 27, 32, 46 Garner v. State Farm Mut. Auto. Ins. Co., 2010 WL 1687829 (N.D. Cal. Apr. 22, 2010)...................................................24 Gatreaux v. Pierce, 690 F.2d 616 (7th Cir. 1982) ............................................................................27 Gray v. Golden Gate Recreational Area, 279 F.R.D. 501 (N.D. Cal. 2011) ......................................................................36 Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) ..................................................................passim In re Austrian & German Bank Holocaust Litig., 80 F. Supp. 2d 165 (S.D.N.Y. 2000) ...........................................................28, 30 In re Cendant Corp. Derivative Action Litig., 232 F. Supp. 2d 327 (D.N.J. 2002)...................................................................34


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In re Checking Account Overdraft Litigation, 830 F.Supp.2d 1330 (S.D. Fla. 2011)...............................................................34 In re Facebook, Inc., PPC Advertising Litig., 282 F.R.D. 446 (N.D. Cal. 2012) ......................................................................36 In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454 (9th Cir. 2000) ......................................................................24, 34 In re Mercury Interactive Corp. Sec. Litig., 618 F.3d 988 (9th Cir. 2010) ............................................................................47 In re Pacific Enterprises Sec. Litig., 47 F.3d 373 (9th Cir. 1995) ..............................................................................24 In re Tableware Antitrust Litig., 484 F.Supp.2d 1078 (N.D. Cal. 2007) ........................................................31, 42 In re Veritas Software Corp. Sec. Litig., 2005 U.S. Dist. LEXIS 30880 (N.D. Cal. Nov. 15, 2005)................................34 Kanawi v. Bechtel Corp., 254 F.R.D. 102 (N.D. Cal. 2008) ......................................................................38 Linney v. Cellular Alaska Partnership, 151 F.3d 1234 (9th Cir. 1998) ..........................................................................24 Nachsin v. AOL, LLC, 663 F.3d 1034 (9th Cir. 2011) ..........................................................................23 National Rural Telecom. Coop. v. DIRECTV, Inc., 221 F.R.D. 523 (C.D. Cal. 2004).......................................................................28 Parra v. Bashas, Inc., 536 F.3d 975 (9th Cir. 2008) ............................................................................37 Paul, Johnson, Alston & Hunt v. Graulty, 886 F.2d 268, 272 (9th Cir. 1989) ....................................................................24 Petersen v. Lowe’s Hiw, Inc., 2012 U.S. Dist. LEXIS 123018 (N.D. Cal. Aug. 24, 2012)..............................24 Radcliffe v. Experian Solutions, Inc., ___ F.3d ___, 2013 WL 1715422 (9th Cir. Apr. 22, 2013) ..............................25 Shlensky v. Dorsey, 574 F.2d 131 (3d Cir. 1978)..............................................................................34 Six Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301 (9th Cir. 1990) ..........................................................................23 Staton v. Boeing Co., 327 F.3d 938 (9th Cir. 2003) ............................................................... 27, 28, 29


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Valentino v. Carter-Wallace, Inc., 97 F.3d 1227 (9th Cir. 1996) ............................................................................39 Van Bronkhorst v. Safeco Corp., 529 F.2d 943 (9th Cir. 1976) ............................................................................27 Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir. 2002) ....................................................................23, 24 Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011) ......................................................................................36 Wershba v. Apple Computer, Inc., 91 Cal. App. 4th 224 (2001) .............................................................................35 White v. Experian Info. Solutions, Inc., 803 F. Supp. 2d 1086 (C.D. Cal. 2011) ............................................................34 Wolin v. Jaguar Land Rover N. Am. LLC, 617 F.3d 1168 (9th Cir. 2010) ....................................................................37, 39

Statutes Bus. & Prof. Code § 17200 ..........................................................................................14 Cal. Code Civ. Proc. § 2025.010..................................................................................18 Civ. Code § 1782 ....................................................................................................11, 12

Rules

Fed. R. Civ. P. 23(a) ................................................................................. 35, 36, 37, 38 Fed. R. Civ. P. 23(b) ..............................................................................................35, 39 Fed. R. Civ. P. 23(c)(1)(B) ...........................................................................................41 Fed. R. Civ. P. 23(c)(2)(B) ........................................................................ 41, 42, 43, 46 Fed. R. Civ. P. 23(e)......................................................................................... vi, 27, 41 Fed. R. Civ. P. 23(g) ............................................................................................... ii, 41 Fed. R. Civ. P. 23(h)(1)..........................................................................................42, 43

Treatises Alba Conte & Herbert B. Newberg, NEWBERG ON CLASS ACTIONS § 11.25 (4th ed.

2002)..................................................................................................................29 Alba Conte & Herbert Newberg, NEWBERG ON CLASS ACTIONS § 11.41 (2006 ed.) .28


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Other Authorities

MANUAL FOR COMPLEX LITIGATION (4th ed. 2004) ........................................ 27, 31, 35


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NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF SETTLEMENT AGREEMENT (CaseNo. 10-CV-01610)

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NOTICE OF MOTION

TO ALL PARTIES AND THEIR COUNSEL OF RECORD:

NOTICE IS HEREBY GIVEN THAT on June 28, 2013 at 10:00 a.m., or as

soon as counsel may be heard per Plaintiffs’ request for an order shortening time,

before the Honorable Richard G. Seeborg, United States District Judge, Courtroom

3, 17th Floor of the United States Courthouse, 450 Golden Gate Avenue, San

Francisco, California, Plaintiffs Charlene Gallion, Christopher Corsi, and Raj Johal,

and Sean Pennington and Megan White, will, and hereby do, move pursuant to

Federal Rule of Civil Procedure 23(e) for preliminary approval of their Settlement

Agreement with defendant Apple Inc., along with an order approving the proposed

forms and methods of notice set forth in the Settlement Agreement, and for

conditional approval, for settlement purposes, of the following proposed class:

all United States residents who are or were owners of a Class Device (a) that was tendered to Apple in the United States for repair or replacement during the Relevant Time Period; (b) at the time of tender, the Class Device was within either the one-year limited warranty period or, if covered by an AppleCare Protection Plan, the two-year plan coverage period; and (c) repair or replacement of the tendered Class Device was denied by Apple on the basis of Apple’s Former Liquid Damage Policy. The Settlement Class excludes counsel for the parties and members of their immediate families; Apple; any entity in which Apple has a controlling interest; Apple’s directors, officers, and employees; Apple’s legal representatives, successors, and assigns; the presiding Judges in the Federal and State Actions; and all persons who validly request exclusion from the Settlement Class.

Declaration of Dina E. Micheletti in Support of Motion for Preliminary Approval of

Settlement (“Micheletti Decl.”), Ex. 1 ¶ 1.JJ.1

The motion is brought on the grounds that the proposed settlement is within

the range that may warrant final approval as fair, adequate, and reasonable; that

the proposed forms and methods of notice satisfy due process and are reasonably

1 The capitalized terms in the class definition above are defined as set forth in the parties’ Settlement Agreement, a copy of which is filed concurrently herewith as Exhibit 1 to the accompanying Micheletti declaration. All references to “Ex.” are to the exhibits attached to the Micheletti declaration.


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calculated to reach the Settlement Class Members and apprise them of the essential

terms of the Settlement Agreement and their rights with respect thereto; and that

the proposed settlement class satisfies the requirements for class certification of

Federal Rule of Civil Procedure 23(a) and (b)(3).

The motion is based on this Notice, the memorandum of points and

authorities set forth below, the accompanying Micheletti Declaration, all other

papers and records in the Court’s file, and such other and further matters as may be

presented at the hearing.

DATED: May 28, 2013 FAZIO | MICHELETTI LLP

by /s/ Jeffrey L. Fazio

Jeffrey L. Fazio (146043) Dina E. Micheletti (184141)

FAZIO | MICHELETTI LLP 2410 Camino Ramon, Suite 315

San Ramon, CA 94583 Telephone: 925-543-2555 Facsimile: 925-369-0344

CHIMICLES & TIKELLIS LLP By: /s/ Steven A. Schwartz Steven A. Schwartz (pro hac vice) Timothy N. Mathews (pro hac vice) 361 W. Lancaster Avenue Haverford, PA 19041 Telephone: 610-642-8500 Facsimile: 610- 649-3633

Interim Co-Lead Class Counsel

CAFFERTY CLOBES MERIWETHER & SPRENGEL LLP

By: /s/ Anthony F. Fata

Anthony F. Fata (pro hac vice pending) Daniel O. Herrera (pro hac vice pending) 30 N. LaSalle, Suite 3200 Chicago, IL 60602 Telephone: 312-782-4880 Facsimile: 312-782-4485

Proposed State Plaintiffs Liaison Counsel


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MPA ISO MOTION FOR PRELIMINARY APPROVAL OF SETTLEMENT AGREEMENT (CASE NO. 10-CV-01610)

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I. INTRODUCTION

Class Counsel and Plaintiffs Charlene Gallion, Christopher Corsi, Raj Johal

and Sean Pennington and Megan White are pleased to report that, after extensive

discovery, negotiation, and mediation, they have negotiated a $53 million, non-

reversionary cash settlement that, if approved, will provide an exemplary recovery

for the Settlement Class Members. Moreover, Class Counsel have negotiated a

state-of-the-art notice and distribution process whereby checks could be mailed to as

many as approximately 153,000 Settlement Class Members without the need for

those Settlement Class Members to submit a claim.

The key components of the Settlement are as follows:

• $53 Million Settlement Fund: Apple will pay $53 million into a non-

reversionary Settlement Fund, the net proceeds of which will be paid to

Settlement Class Members—i.e., owners of iPhones and iPod touch

devices (collectively, “Class Devices”) who were denied warranty coverage

while Apple’s Former Liquid Damage Policy, described below, was in

force. See Ex. 1 ¶¶ 1.H, 1.V, 1.JJ, 18-20. The Settlement Fund will also

be used to pay Class Counsel’s attorneys’ fees and costs, and to provide

modest incentive awards to the Class Representatives who prosecuted this

action to a successful conclusion. Id. ¶18.

• Global Settlement: The Settlement will resolve all cases before this

Court as well as the claims asserted in the class action filed by Sean

Pennington and Meghan White in the State Action.2 Id. ¶ 44. State

Plaintiffs are filing contemporaneously herewith a complaint in this

Court, which they request to be consolidated with the Federal Actions for

purposes of the Settlement, and State Plaintiffs have requested the State

2 The State Action is Pennington, et al. v. Apple, Inc., Case No. 1-10-CV-162659 (Cal. Super. Ct., Santa Clara Cty.). See Ex. 1 ¶ 1.NN.


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Court to stay the State Action pending resolution of final approval

proceedings before this Court.3

• Notice/Claims Administration Costs: In addition to the $53 million

Settlement Fund, Apple will separately pay all costs (estimated to be in

excess of $1 million) associated with Class Notice and claims

administration. Id. ¶ 21. Subject to the Court’s approval, Kurtzman

Carson Consultants LLC (“KCC”) will serve as the Settlement

Administrator. Id. ¶ 1.HH.

• Distribution of Settlement Benefits to Settlement Class Members:

Counsel have also negotiated a state-of-the-art, consumer-friendly process

for distributing the settlement benefits to Settlement Class Members:

o Direct-Payment Settlement Class Members: Direct-Payment

Settlement Class members are entitled to receive payment from the

Settlement Fund without having to submit a claim form, provided

that Apple’s records contain, or the Settlement Class Member

provides, a current postal address to which a check can be mailed

(and they do not opt out). Ex. 1 ¶¶ 1.P, 26, 33-34. Apple has

identified approximately 153,000 Class Devices owned by potential

Direct-Payment Settlement Class Members.4 Micheletti Decl. ¶ 58.

Assuming they do not opt out and the Settlement Agreement is

approved, checks will be mailed automatically to Direct-Payment

Settlement Class Member for whom postal address information is

3 “The Federal and State Plaintiffs prosecuted their respective actions against Apple for the common benefit of members of the Settlement Class, coordinated their efforts regarding discovery from Apple, and both participated in the settlement negotiations and mediations with Apple.” Ex. 1 ¶14.

4 Apple’s records currently reflect potential postal and/or email addresses associated with approximately 130,000 of those Class Devices. The parties will work with KCC to refine address and email information for the owners of those Class Devices, and for the owners of the approximately 23,000 other Class Devices. Micheletti Decl. ¶¶ 51.


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available, even if they do nothing. Ex. 1 ¶¶ 33-34. Direct-Payment

Settlement Class Members for whom email addresses are available

need only provide a current address to be mailed a check. Id.

o Claims-Made Settlement Class Members: All other Settlement

Class Members will be able to submit a claim using a

straightforward Claim Form either online, via a Settlement

Website that will be maintained by the Settlement Administrator,

or, if they choose, by mailing a paper claim form. Ex. 1 ¶¶ 1.E, 35.

• Notice Program: Both email and postcard notices will be sent to all

Direct-Payment Settlement Class Members, to the extent that Apple’s

records (as updated by KCC) include both kinds of address. Ex. 1 ¶ 26.

To ensure maximum coverage, Apple will also bear the cost of sending

emailed notice to over 4 million owners of Class Devices who made a

customer-service appointments at Apple retail stores (“Apple Stores”)

during the relevant time period(s), some of whom may have been denied

warranty coverage for alleged liquid exposure.5 In addition to these direct

notices, Published Notice will appear in USA Today and MacWorld, and

KCC will establish a Settlement Website where Settlement Class

Members can download all documents related to the Settlement. Id. ¶¶

1.MM, 28-30, 35.

• Allocation: Settlement Class Members will receive a proportionate share

of the Net Settlement Fund, as determined by the type and configuration

of the Class Device that was the subject of a warranty claim that Apple

5 Such an appointment is a prerequisite to obtaining service and/or submitting a warranty claim at an Apple Store. Micheletti Decl. ¶ 64. Thus, potential Settlement Class Members for whom Apple does not have complete information to qualify as Direct-Payment Settlement Class Members, but for whom Apple has an e-mail address, will be sent direct notice of the Settlement. If an email is returned as undeliverable and Apple has a postal address, notice will then be mailed. Id. & Ex. 1 ¶ 27.


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denied. Id. ¶ 33.

• Release: Class Counsel negotiated a narrowly-tailored release that is

limited exclusively to persons whose warranty claims were denied by

Apple due to the Former Liquid Damage Policy during the relevant time

frame (“Settlement Class Members”) and is also limited exclusively to

causes of action arising from denials resulting from Apple’s Former Liquid

Damage Policy. Id. ¶¶ 1.FF, 53.

By this unopposed motion, Plaintiffs respectfully request an order

preliminarily approving the Settlement terms; conditionally certifying the

Settlement Class; approving the appointment of the Class Representatives and

Class Counsel; appointing Co-Lead and State Plaintiffs’ Liaison Counsel; approving

and directing the distribution of Class Notice; and setting a schedule for final

approval proceedings.

As this Court has recognized, a proposed settlement is provisionally

considered to be fair, reasonable, and adequate and preliminary approval should be

granted if

[1] the proposed settlement appears to be the product of serious, informed, non-collusive negotiations, [2] has no obvious deficiencies, [3] does not improperly grant preferential treatment to class representatives or segments of the class, and [4] falls with the range of possible approval . . . . Because some of the factors bearing on the propriety of a settlement cannot be assessed prior to the final approval hearing, a full fairness analysis is unnecessary at this stage.

Fraley v. Facebook, Inc., 2012 WL 5838198, *1 n. 1 (N.D. Cal. Aug. 17, 2012)

(citations and inner quotation marks omitted).

The Settlement meets each of these criteria, as briefly explained by the key

facts below and as described in Section III.B., infra.

Highly-contested, novel claims: This outstanding settlement was initially

reached after more than two years of adversarial litigation and vigorous

negotiations between Apple and Class Counsel in the Federal and State Actions.


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While Class Counsel believe their claims are strong, they are based in part on

untested legal theories against an extremely sophisticated defendant who asserted

numerous potentially viable defenses, which were supported by testimony from and

testing conducted by its own renowned engineers. Put simply, this litigation

involved substantial risk and uncertainty.

Plaintiffs’ case centers on the propriety of Apple’s Former Liquid Damage

Policy, which required Apple personnel to deny warranty coverage if a Liquid

Submersion Indicator (“LSI”) that Apple installed adjacent to the dock connector

and/or inside the headphone jack of Class Devices where they are externally

viewable (“external LSIs”)6 had changed color from white to pink or red. See

generally Master Complaint (Dkt. No. 53) (“Comp.”) ¶¶ 13-22. As described more

fully below, an LSI is a paper-ink laminate made from Water Contact Indicator

Tape (“WCIT”) manufactured by 3M Company (“3M”) that is intended to change

color from white to red when the un-laminated portion is exposed to liquid.

According to Apple, a red or pink external LSI was sufficient proof that the Class

Device had been damaged by liquid, thereby rendering the warranty void pursuant

to provisions in its warranties that excluded coverage for, inter alia, “liquid spill or

submersion” or “abuse.” Id.

Plaintiffs alleged and were prepared to demonstrate at trial that Apple’s

Former Liquid Damage Policy was a pretext for denying valid warranty claims in

violation of its warranty contracts and the implied covenant of good faith and fair

dealing because, inter alia, LSIs merely indicate that a Class Device may have been

exposed to liquid, but do not and cannot establish that a Class Device had been

damaged by exposure to liquid, much less prove that liquid exposure caused the

malfunction that led a customer to seek repair or replacement under warranty.

6 Apple contends that these LSIs are not accurately characterized as “external” LSIs, but are merely externally viewable.


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Plaintiffs also alleged that LSIs could be triggered by moisture or humidity during

ordinary, foreseeable use, and that 3M’s testing and product instructions stated

that pink was merely an indication of humidity, and did not indicate contact with

liquid. Id. ¶¶ 13-24, 62-63.

Plaintiffs’ legal arguments included, but were not limited to, their contention

that, as the proponent of an exclusion from warranty coverage, Apple bore the

burden of proving that a Class Device had been damaged by the customer.

Plaintiffs also argued, among other things, that Apple could not meet that burden

by pointing to triggered external LSIs, because LSIs cannot detect actual damage or

abuse or establish the cause of that damage. Plaintiffs’ claims and initial factual

allegations were developed as a result of Class Counsel’s thorough pre-filing

investigation and were fleshed out and supported by Class Counsel’s exhaustive

legal research and discovery efforts and by Plaintiffs’ experts.

Apple vehemently disagreed with Plaintiffs’ allegations, insisting that testing

by its engineers demonstrated that the external LSIs were reliable and would not

turn red or pink unless a Class Device had been damaged or abused as a result of

extensive liquid contact. Apple contended that 3M’s humidity testing was

conducted on indicator tape open to the elements (not contained inside a device) and

at unrealistic extremes of temperature and humidity. Apple also argued that its

humidity testing demonstrated that the LSIs contained in an iPhone and iPod touch

would not change color as a result of real-world heat and humidity. Apple also

contended that individual issues precluded class certification. Among other

arguments, Apple asserted that Plaintiffs had the initial burden of proving that

each malfunction was the result of a manufacturing defect, and that it was

impossible to do without questioning each member of the proposed class and

inspecting his or her Class Device. Additionally, Apple argued that the only

predominating common fact was that each proposed class member had a triggered

LSI, thereby making it more likely than not that, in the absence of individualized


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proof, liquid exposure caused the malfunction.

Because of the dearth of case law squarely addressing the core legal issues in

dispute, and the parties’ starkly different view regarding the core factual issues,

including, but not limited to, whether a pink or red LSI established that a Class

Device had been abused or damaged by liquid, virtually every aspect of this

litigation was hotly contested from beginning to end.

Extensive Discovery: Class Counsel conducted comprehensive, wide-

ranging discovery from Apple and non-parties 3M, FoxConn Corp. and FoxConn

International Holdings, Inc. (the Chinese manufacturer of the iPhone), Hon Hai

Precision Industry Co. (FoxConn’s parent), Exponent (which performed testing for

Apple), SquareTrade Inc. (which offered extended, third-party warranties for Class

Devices), and AT&T Mobility (the sole provider of cellular service during the

relevant time period). Micheletti Decl. ¶ 13-14. Class Counsel’s discovery efforts

included, among other things (1) the review, and analysis of approximately 300,000

pages of documents produced by Apple and by third parties; (2) dozens of lengthy

meet-and-confer sessions with Apple and third parties, (3) depositions of several

high-ranking Apple employees and witnesses; (4) depositions of the 3M engineer

who invented the WCIT and 3M’s chief sales representative and liaison for the

Apple account; (5) analyses conducted by Plaintiffs’ experts, including (i) one of the

world’s foremost authorities on electronics reliability and failure analysis, (ii) an

expert with extensive experience with handheld devices, and (iii) an expert with,

inter alia, considerable hands-on experience working for a major computer maker

testing the effects of high humidity environments on the reliability and performance

of packaged electronic devices; (6) answers to multiple sets of interrogatories and

requests for admission regarding Apple’s policies and the technology upon which it


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relied; and (7) thorough independent research by Class Counsel. Id.7

Extensive Mediation: Given the parties’ diametrically opposing views on

the nature, scope, and extent of Apple’s liability, and the suitability of this case for

class treatment, the parties had starkly different views regarding the settlement

value of the case. Id. ¶ 40. Consequently, the settlement was only achieved after

protracted, well-informed mediation efforts. Id. The parties participated in six,

full-day, in-person mediation sessions before retired U.S. Magistrate Judge Edward

Infante and/or Ms. Catherine Yanni of JAMS from October 2011 through April

2012, and in dozens of telephone conferences with one or both mediators between

and after the formal mediation sessions. Id. Litigation continued in parallel with

those mediation sessions, including taking and preparing for the critical 3M

depositions and additional depositions of Apple witnesses; ongoing document

production and review; ongoing meet-and-confer efforts regarding many discovery

disputes; and expert analysis. Id. ¶ 41.

Settlement negotiations were conducted by Class Counsel—who have

significant experience in class actions and other forms of complex litigation—and

were informed by a substantial amount of legal research, discovery, input from

experts, and independent investigation that occurred before and during the course

of the litigation, and in preparation for depositions, class certification, summary

judgment, and trial. Id. ¶¶ 5, 42. After months of intensive negotiations, the

parties reached a settlement that resolves the consolidated cases before this Court

and also the State Action, which the State Plaintiffs have re-filed before this Court

7 Throughout the litigation, both sides took seriously their obligation to resolve disputes, particularly discovery disputes, without needlessly involving the Court. Id. ¶ 15. The parties had numerous, extensive disputes regarding many document requests, interrogatories, deposition notices and assertions of privilege, but they resolved each of these disagreements (sometimes with the assistance of the mediators) without resorting to motion practice before this Court. Id. Plaintiffs were, however, forced to file a motion to compel 3M to produce what proved to be critical documents. Id. That motion was granted by a Magistrate Judge of the District of Minnesota, and 3M’s appeal to the District Court was denied. Id.


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for purposes of the Settlement.

The Settlement that Class Counsel negotiated is not only fair, adequate and

reasonable by any measure, it is exceptional.

II. BACKGROUND8

A. APPLE’S STANDARD AND EXTENDED WARRANTIES

In June and September 2007 respectively, Apple introduced the iPhone and

the iPod touch (which is essentially an iPhone without telephonic capabilities).

Comp. ¶¶ 10, 12. Apple sells each Class Device with a one-year warranty, which

provides that Apple will repair or replace the device for free if it malfunctions as a

result of defective materials or workmanship (the “Standard Warranty”). Id. ¶¶ 13-

14. Consumers could also purchase the AppleCare Protection Plan (“Extended

Warranty”) for $69/$59, which provided an additional year of warranty coverage.

Id. ¶ 15. Both Warranties contain provisions that exclude coverage for damage

caused by, inter alia, “liquid spill or submersion” or “abuse.” (the “Liquid-Damage

Exclusion”). Id. ¶¶ 16-17.

B. APPLE’S FORMER LIQUID DAMAGE POLICY

Apple’s LSIs utilize a product invented and manufactured by 3M called

Water Contact Indicator Tape. Similar to litmus paper, WCIT was designed by 3M

to change color (from white to red) if it comes into contact with a single drop (or

less) of liquid. The purpose of WCIT is to alert a manufacturer that a device may

have been exposed to liquid (hence the word “Indicator” in the name of 3M’s product

as well as Apple’s Liquid Submersion Indicators) and that the device should be

carefully inspected to determine whether liquid actually caused the malfunction in

question. See, e.g., Comp. at 6 n. 2.

Rather than using LSIs as a mere indication that a Class Device may have

8 For purposes of this motion, the work performed by Class Counsel is discussed collectively, without any attempt to differentiate between the contributions of each law firm or groups of law firms. Micheletti Decl. ¶ 5.


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been exposed to liquid, under Apple’s Former Liquid Damage Policy, Apple required

its personnel to deny warranty coverage if an external LSI9 had turned red or pink

(even though 3M literature states that pink merely indicates possible exposure to

humidity, not liquid) (see Micheletti Decl., Ex. 8) without conducting any further

investigation into whether the Class Device had actually been submersed in liquid

or abused or was damaged due to liquid contact. Id. ¶ 22.

During the Settlement Class Period, Apple typically offered to sell

replacement Class Devices at reduced prices to consumers whose warranty claims

were denied under its Former Liquid Damage Policy. The amount of the reduced

prices depended on the original device type (e.g., iPhone, iPhone 3G, an iPod touch)

and configuration (e.g., 8GB, 16GB, 32GB, etc.). Id. ¶¶ 33-34. Apple publicly

announced this policy (called “Out of Warranty Service” or “OOW”) in May 2009.

Id.

The experiences of Class Representatives Charlene Gallion, Christopher

Corsi, Raj Johal, and Sean Pennington and Megan White demonstrate how Apple’s

Former Liquid Damage Policy affected them, and their experiences are illustrative

of the Settlement Class Members they seek to represent in this action.

• Each Class Representative owned at least one Class Device that failed

while it was covered by Apple’s warranty.

• Each Class Representative presented at least one Class Device to

Apple for warranty repair during the Settlement Class period.

• Each Class Representative was denied warranty coverage by Apple

solely because an external LSI had turned pink or red.

9 Other manufacturers typically installed Water Contact Indicator Tape inside their devices (e.g., under the battery), where service personnel could easily open the battery compartment and conduct a further inspection if the WCIT has turned red. Apple installed its external LSIs just a few millimeters from the surface of Class Devices, where they could be externally viewed without the need to open the Class Device.


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• Each Class Representative denied Apple’s insistence that he or she had

abused the Class Device by submersing it in liquid, but to no avail.

• in each case, Apple relied solely on a Class Device’s external LSIs to

deny warranty coverage;10

• After Apple denied his or her warranty claim, each Class

Representative was forced to purchase at least one replacement Class

Device, for which he or she was charged a replacement price of $99 to

$199 plus tax. Comp.¶¶ 36-60; see also Micheletti Decl. ¶ 4.

C. APPLE CHANGED ITS LIQUID-DAMAGE POLICY, BUT DID NOT

COMPENSATE CUSTOMERS WHOSE WARRANTY CLAIMS WERE DENIED PURSUANT TO APPLE’S FORMER LIQUID DAMAGE POLICY

Apple changed its Former Liquid Damage Policy as it pertained to the iPhone

in or around November 2009. Micheletti Decl. ¶_8. As with other policy changes,

Apple made no public announcement of the change.11 Id. Apple continued to

enforce its Former Liquid Damage Policy as to the iPod touch until May 2010, many

months after Plaintiffs served demand letters required by the Consumers Legal

Remedies Act (“CLRA”), see Civ. Code § 1782, and filed these lawsuits. Id. Apple

has represented that under its current liquid damage policy for both types of Class

Devices, a Warranty Claim should no longer be denied based solely on an external

LSI. Ex. 1 ¶ 7.12

10 After he was told that his warranty claim had been denied because his Class Device’s external LSI had been triggered, Mr. Corsi was able to persuade Apple to open and inspect his iPhone. Although the Apple representative found that the device’s internal LSIs were not triggered, Apple denied warranty coverage anyway pursuant to its Former Liquid Damage Policy, despite the absence of any evidence of liquid exposure or liquid damage. Micheletti Decl. ¶ 4.

11 The following month (in December 2009), Apple changed the name of the Liquid Submersion Indicators to “Liquid Contact Indicators.” Comp. ¶ 24 n. 3.

12 Warranty denials pursuant to Apple’s current liquid damage policy are not part of the proposed Settlement Class and the release of warranty claims is limited to claims denied pursuant to Apple’s Former Liquid Damage Policy. Ex. 1 ¶¶ 7, 53.


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Notwithstanding the change in Apple’s policies, Apple continues to

adamantly deny any liability for denying warranty coverage under its Former

Liquid Damage Policy and, until the settlement of this litigation, declined to

reimburse consumers whose warranty claims it had rejected pursuant to that policy.

Micheletti Decl. ¶_9.

D. PLAINTIFFS FILE THE LAWSUITS THAT WERE ULTIMATELY

CONSOLIDATED BEFORE THIS COURT AND AGREE TO COORDINATE THEIR LITIGATION EFFORTS

Class Counsel independently investigated the legal and factual bases for

their clients’ claims. Beginning December 7, 2009, they served written demands

pursuant to the California Consumer Legal Remedies Act (“CLRA”), Cal. Civ. Code

§ 1782(a). Id. ¶¶ 33-34. Apple refused to provide the monetary relief requested in

the CLRA demand letters. Id. ¶ 34. On January 29, 2010, Plaintiffs began filing

their respective complaints. Id. At the time they served their respective CLRA

demands and/or filed their complaints, counsel for each Plaintiff was unaware of

other counsel’s efforts, and the scope of the CLRA letters and complaints differed as

to class definition, class devices, and claims. Id. ¶ 35 & n. 3. Upon learning of each

other’s efforts, however, Class Counsel promptly began discussions among

themselves regarding appropriate coordination so as to efficiently prosecute the

litigation for the common benefit of what became the Settlement Class. Id. ¶ 35.

At first, Class Counsel coordinated their efforts informally. Id. ¶ 36. Then,

on August 13, 2010, the Court issued an order formally relating Gallion and Corsi,

each of which was filed in this Court on behalf of a proposed national class. Id. On

December 29, 2010, the Court consolidated Gallion, Corsi and Calix,13 titled the

13 The Calix action was filed on behalf of a class of Louisiana residents in September 2010 and transferred from the Middle District of Louisiana to this Court. Plaintiff Calix and his counsel support the proposed Settlement. However, because Mr. Calix’s warranty was not denied pursuant to Apple’s Former Liquid Damage Policy, Mr. Calix is not a signatory to the Settlement Agreement and is not


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consolidated action In re Apple iPhone/iPod Warranty Litigation (No. CV-10-

01610), and appointed Fazio | Micheletti LLP and Chimicles & Tikellis LLP as

Interim Co-Lead Class Counsel. Id. ¶ 37. In June 2011, the Federal Plaintiffs filed

an Amended Master Complaint. Id.

Thereafter, Federal Plaintiffs’ Counsel and State Plaintiffs’ Counsel generally

continued to coordinate their efforts with respect to discovery from Apple and both

groups of counsel participated in the mediation and settlement negotiation process

that resulted in this Settlement Agreement for the common benefit of the

Settlement Class. Id. ¶ 39.

E. SUMMARY OF THE ISSUES IN DISPUTE

Plaintiffs allege claims for breach of warranty and the implied covenant of

good faith and fair dealing; common-law fraud; violation of applicable consumer-

protection statutes; and unjust enrichment. See Comp. ¶¶ 87-128. Apple denied all

of Plaintiffs’ allegations of wrongdoing. See, e.g., Answer to Master Complaint (Dkt.

No. 57). The parties vigorously disputed numerous issues, including the following:

• Whether LSIs are capable of detecting liquid abuse or liquid damage;

• Whether a red or pink external LSI demonstrated that a Class Device

was abused or damaged by liquid;

• Whether testing by Apple engineers showed that LSIs functioned as

intended and that only exposure to an abusive amount of liquid would

trigger an external LSI;

• Whether Plaintiffs had an obligation to establish that the malfunction

at issue was covered by Apple’s warranty notwithstanding that

Apple’s warranties warned consumers not to open Class Devices to

attempt to conduct such a diagnosis, and notwithstanding that Class

a Settlement Class Member. Ex. 1 ¶ 2 & Micheletti Decl. ¶¶ 37-38. The Calix action will be voluntarily dismissed with prejudice upon final approval of the Settlement Agreement. Micheletti Decl. ¶ 38.


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Devices were designed to make it difficult, if not impossible, to open

and inspect them;

• Whether Apple, as the proponent of an exclusion from coverage, bears

the burden of establishing the factual basis for invoking the exclusion;

• Whether a pink external LSI was a sufficient basis for Apple to assert

that a Class Device had been in contact with liquid, given that 3M’s

testing and training materials stated that pink merely indicated

exposure to humidity;

• Whether evidence developed in discovery demonstrated a strong

correlation between a triggered external LSI and a triggered internal

LSI or evidence of corrosion, or whether such evidence shows that an

external red or pink LSI is not sufficient to establish actual liquid

damage to a Class Device;

• Whether, as Apple contended, Class Counsel’s maximum projected

damages were overstated;

• Whether Apple breached its warranty agreements and the implied

covenant of good faith and fair dealing by using triggered external

LSIs as the sole basis to deny valid warranty claims;

• Whether Apple engaged in conduct that constitutes common-law fraud

and violated the CLRA and the Unfair Competition Law (“UCL”), Bus.

& Prof. Code §§ 17200-17209, by misstating the nature of its

warranties at the time of sale of the Class Devices;

• Whether Apple engaged in conduct that constitutes common law fraud

and violated the CLRA and the UCL by advising customers that a red

or pink LSI established that their Class Device had been damaged by

liquid.


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F. DISCOVERY EFFORTS

Plaintiffs’ discovery efforts included, but were not limited to, the following:

1. Experts

Class Counsel retained a formidable team of experts at the outset of the

litigation, and sought their advice regarding a variety of issues including their

evaluation of the evidence obtained in formal and informal discovery and the

technical issues arising from that evidence; drafting certain discovery requests;

supporting the motion for an order compelling 3M to produce the subpoenaed

documents; and preparing the case for mediation, class certification, and trial.

Micheletti Decl. ¶ 16.

2. Discovery From Apple

Class Counsel promptly initiated formal and informal discovery. Apple’s

counsel indicated that discovery would be hard fought and time consuming—and

they were correct. See, e.g., Docket No. 18 at 4:24-26.

At the outset of the litigation, the parties engaged in extensive negotiations

over the proper level of coordination between the Federal and State Actions.

Ultimately, the parties agreed on a coordination strategy that maximized efficiency

without requiring Plaintiffs to lose rights available to them under the various state

and federal rules of civil procedure. Micheletti Decl. ¶ 17. Very early on, the

parties also engaged in prolonged negotiations regarding two foundational issues;

namely, the terms of the protective orders (including the proper scope of Apple’s

confidentiality designations, and issues concerning the nature and scope of Apple’s

search for responsive documents, including the appropriate use of key words that

Apple would use to help guide its initial document-production efforts). Id. ¶ 18.

Ultimately, Class Counsel in the State action were required to seek the involvement

of the court in that action to resolve issues relating to the protocol for Apple’s

production of documents and the terms of the protective order ultimately entered in

that Court. Id. ¶ 19.


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Collectively, Class Counsel propounded eight sets of comprehensive document

requests covering every issue in the litigation, 14 sets of interrogatories, and five

sets of requests for admission. Id. ¶ 20. Given the fiercely contested nature of the

litigation, the parties engaged in dozens of lengthy meet-and-confer sessions

regarding, inter alia, the scope of virtually every one of Plaintiffs’ discovery

requests, the manner in which Apple proposed to conduct its document and

database searches, Apple’s confidentiality designations, privilege and work-product-

related issues, privilege-log issues, document custodian-issues, deposition-related

issues, the sufficiency of Apple’s discovery responses, and other discovery-related

matters. Id. These meet-and-confer efforts required Class Counsel to engage in ,

inter alia, comprehensive legal research, multiple rounds of letter writing, and

dozens of lengthy telephone conferences with Apple’s counsel. Id. ¶ 21. For

example, on one occasion a dispute concerning Apple’s assertions of privilege in

connection with a specific set of documents and deposition questioning was resolved

only on the eve of Class Counsel’s intended filing of a fully-drafted motion to

compel, which they prepared after previous meet-and-confer efforts had failed. Id. ¶

22.

Class Counsel’s document requests resulted in Apple producing

approximately 265,000 pages of documents, which Class Counsel reviewed and

analyzed. Id. ¶ 23. In addition, Class Counsel conducted multi-day depositions of

three high-level Apple employees whom Apple had designated to testify on its

behalf concerning every aspect of this litigation. Id. ¶ 24. Class Counsel utilized

the information they obtained in discovery to, among other things, depose

witnesses, prepare for class certification, estimate potential damages, assist their

experts, support Plaintiffs’ arguments in connection with trial preparation and

mediation/settlement negotiations, and refute Apple’s defenses. Id. ¶ 25.

Class Counsel also engaged in prolonged meet-and-confer sessions with Apple

concerning depositions of executive “apex” witnesses. Id. ¶ 26. These efforts


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included essentially briefing the issue in order to persuade Apple to make these

witnesses available for deposition, along with multiple meet-and-confer conferences.

Id. In January 2012, Apple agreed to make these witnesses (plus others) available

for deposition. Class Counsel began preparing for those depositions, but, shortly

before those additional depositions were scheduled to take place, the partis reached

agreement as to the amount of a settlement at the next mediation session on

January 16, 2012. Id.

3. Discovery Efforts from Uncooperative Third Parties

Class Counsel issued third-party subpoenas to 3M; Foxconn Corp., Foxconn

International Holdings, Inc. and Hon Hai Precision Industry Co., Ltd.; AT&T;

SquareTrade Inc.; and Exponent. Id. ¶ 13. The subpoenas ultimately resulted in

the production of an additional 77,000 pages of documents (much of which Class

Counsel had not received from Apple). Id. ¶ 27.

Obtaining discovery from these non-parties was challenging. Id. ¶ 28. For

example, 3M fought hard to resist producing documents, then sought to unduly

restrict the nature and scope of its production and insisted that Class Counsel bear

the full cost of 3M’s document collection and production efforts. Id. The meet-and-

confer process with 3M took place over several months and ultimately proved to be

impossible to resolve. Id. Accordingly, Class Counsel were required to file a motion

to compel in the District of Minnesota, which was granted by the Magistrate Judge

and upheld by the District Judge upon 3M’s appeal. Id. Class Counsel

subsequently traveled to Minnesota to depose the 3M engineer who invented and

held the patent for the WCIT used for Apple’s LSIs and the 3M manager of the

Apple account. Id. ¶ 29. 14

Other third parties resisted discovery as well. For example, after months of

14 The court ordered 3M to pay one half of the costs incurred by 3M in responding to the subpoena and Class Counsel to pay the other half. Id. ¶ 28.


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negotiations with AT&T over the terms of a protective order and the scope of its

production, AT&T intercepted the documents it sent via Federal Express before

they were delivered to Class Counsel, refusing to release them until Class Counsel

engaged in more lengthy negotiations regarding additional changes to the protective

order entered by this Court. Id. ¶ 30. After that protective order issue was finally

put to rest, AT&T refused to produce the documents unless Plaintiffs agreed to pay

it over $100,000 in alleged document production costs. Id. ¶ 31. Class Counsel

were gearing up for motion practice when their efforts to meet and confer finally

persuaded AT&T to release the documents. Id.

Some of the documents produced by these third parties and testimony from

the 3M witnesses were critical pieces of evidence that Class Counsel and their

experts used to support Plaintiffs’ allegations and refute Apple’s defenses while

preparing for certification and for trial and during settlement negotiations. Id. ¶

32.

G. MEDIATION, FURTHER FORMAL DISCOVERY, MORE NEGOTIATIONS AND INFORMAL DISCOVERY

Settlement negotiations included six full-day mediation sessions (October 13,

2011, November 10, 2011, January 16, 2012, February 3, 2012, February 24, 2012,

and April 27, 2012). Id. ¶ 40. Between the October and January mediation

sessions, Class Counsel continued deposing certain Apple personnel; deposed the

3M witnesses in Minnesota; secured, over Apple’s objections, deposition dates for

the resumption of additional deposition days of the witnesses Apple had designated

pursuant to Rule 30(b)(6) and Cal. Code of Civil Procedure § 2025.010 and for the

depositions of persons Apple considered “apex” witnesses; continued to propound

and meet and confer over prior formal written discovery (meet-and-confer sessions

took place throughout December 2011 and early January 2012); and prepared for

class certification proceedings. Id. ¶¶ 41-44.


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Before the first mediation session began in October 2011, the mediators

received briefing of relevant legal and factual issues from each of the parties. Id. ¶

45. The State and Federal plaintiffs each submitted separate mediation briefs.

Apple submitted its own brief, and made a formal PowerPoint presentation of its

evidence. Id. By the end of the first session, the parties had made no progress

towards settlement, but agreed to continue their efforts to try to resolve this case by

settlement while continuing to litigate. Id.

In connection with the second mediation session in November 2011, Class

Counsel, with expert assistance, prepared and presented an extensive PowerPoint

presentation of their case for the mediators and for Apple based on documents

Apple and 3M had produced in discovery, materials that Class Counsel obtained by

way of informal investigations and informal research and discovery efforts, and on

sworn testimony by the witnesses those companies had designated to testify on

their behalf. Id. ¶ 46. The presentation addressed key aspects of Plaintiffs’

position. Once again, however, the parties were unable to reach agreement and the

litigation continued. Id.

Plaintiffs continued to vigorously pursue discovery in December 2011 and

early January 2012, while the mediators engaged in shuttle diplomacy with the

parties. Id. ¶ 47. After multiple discussions with the mediators including

throughout the holidays, the parties made sufficient progress to warrant a third

mediation session. Id.

That mediation occurred on January 16, 2012. After a full day of hard fought

negotiations, the parties narrowed their differences to a gap that was only closed by

a mediators’ proposal from Judge Infante and Ms. Yanni. Id. ¶ 48. Both sides

accepted that proposal, thereby reaching tentative agreement (subject to approval

by Apple’s senior executives and confirmatory discovery) that Apple would pay $53

million into a non-reversionary settlement fund, and that Apple would bear the cost

of class notice and settlement administration (estimated at that time to be more


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than $1 million). Id.

H. POST-SETTLEMENT DISCOVERY AND DRAFTING THE SETTLEMENT AGREEMENT

While reaching the $53 million agreement was a significant milestone, the

parties still had a substantial amount of work to do. Finalizing the settlement

details was a protracted, difficult process, which necessitated three additional full

mediation sessions in February and April 2012, plus numerous teleconferences with

the mediators before and after the last formal mediation session. Id. ¶ 49. The

disputed issues included the informal discovery necessary to confirm, under oath,

certain facts pertaining to Settlement Class Members’ damages and information

necessary for notice. Id. The parties also spent considerable time researching,

finalizing, drafting, and negotiating myriad other Settlement details, including, but

not limited to, an allocation plan; the notice plan; the details of a user-friendly

claims process; the content of claim forms and various forms of notice; the selection

of a Settlement Administrator; and the research and other efforts necessary to

identify potential appropriate cy pres recipients. Id.

The settlement documents were numerous, lengthy, and complicated to draft

and reach agreement on because, among other confounding factors, they included

different notice and claims procedures depending on the contact and other

information available in Apple’s records, and because of the provision in the

Settlement Agreement providing for direct payments to Settlement Class Members

where possible. Id. ¶ 50. Thus, the Settlement Agreement has a total of 15

exhibits, nine of which are different tailored versions of notices and claim forms—

each of which required multiple rounds of negotiations to finalize. Id.; see also Ex. 1

at Exs. A-O thereto. Due to the number of issues left open following the January

2012 mediation session, the finality of this settlement remained in doubt until the

formal Settlement Agreement was signed in April 2013. Micheletti Decl. ¶ 50.


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I. SETTLEMENT BENEFITS FOR CLASS MEMBERS

As discussed above, the centerpiece of this settlement is the creation of an all-

cash, non-reversionary $53 million Settlement Fund. In addition, Apple will

separately pay to create and distribute the Class Notice and to administer the

claims procedure and every other aspect of the settlement. Ex. 1 ¶¶ 1, 18-21.15

The Settlement Class and proposed Release of Claims are each very narrowly

tailored and limited to those consumers who actually had their warranty claims

denied by Apple while Apple’s Former Liquid Damage Policy was in effect, and who

are therefore eligible to receive a payment from the Settlement Fund. The proposed

Settlement Class is defined as follows:

all United States residents who are or were owners of a Class Device (a) that was tendered to Apple in the United States for repair or replacement during the Relevant Time Period; (b) at the time of tender, the Class Device was within either the one-year limited warranty period or, if covered by an AppleCare Protection Plan, the two-year plan coverage period; and (c) repair or replacement of the tendered Class Device was denied by Apple on the basis of Apple’s Former Liquid Damage Policy. The Settlement Class excludes counsel for the parties and members of their immediate families; Apple; any entity in which Apple has a controlling interest; Apple’s directors, officers, and employees; Apple’s legal representatives, successors, and assigns; the presiding Judges in the Federal and State Actions; and all persons who validly request exclusion from the Settlement Class.

Id. ¶ 1.JJ.

The “Relevant Time Period” encompasses the period during which Apple’s

Former Liquid Damage Policy was in effect, and means on or before December 31,

2009, for any iPhone and on or before June 30, 2010, for any iPod touch. Id. ¶

1.GG.16

15 Court-approved attorneys’ fees, litigation expenses, and incentive awards (if any) are to be paid out of the Net Settlement Fund. See Section II.K, below.

16 Apple actually changed its Former Liquid Damage Policy one month prior to the dates used to define the Settlement Class (i.e., in November 2009 (iPhone) and May 2010 (iPod touch)); the extra months reflect the fact that new policies take time to implement, thus the addition of the extra months allows people who may have been affected by the older policy to file claims. Micheletti Decl. ¶ 8.


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The proposed Release is limited to Apple’s denial of warranty claims as a

result of Apple’s Former Liquid Damage Policy and specifically excludes personal

injury claims, claims for the denial of warranty claims relating to ostensible liquid

damage made after December 31, 2009 (iPhone) and after June 30, 2010 (iPod

touch), and claims for the denial of warranty service for any other reason unrelated

to Apple’s Former Liquid Damage Policy. Ex. 1 ¶ 53. The narrow Release thus

leaves those who believe they have such claims free to bring their own claims if they

believe Apple improperly denied them warranty coverage.

Class Counsel also negotiated a state-of-the-art, user-friendly distribution

procedure in order to maximize payments to Settlement Class Members. The

Settlement Administrator will mail checks to Direct-Payment Settlement Class

Members without the need to submit a claim form, provided Apple’s records reflect,

or the Settlement Class Member provides, a current mailing address. Claims-Made

Settlement Class Members will be able to submit their claims by filling out a

straightforward Claim Form, which they may elect to do entirely online, or submit

via regular mail. Ex. 1 ¶ 35.

To the extent funds remain and/or further distributions are impractical, none

of those funds will revert to Apple. Instead, those funds will first be used to pay

Settlement Class Members up to 200% of the average replacement cost for their

particular Class Device, and any remainder will be distributed cy pres to one or

more entities approved by this Court. See id. ¶¶ 18, 33. Mindful of recent Ninth

Circuit case law regarding cy pres recipients, Class Counsel have proposed, subject

to approval by the Court, that the National Consumer Law Center, the National

Association of Consumer Advocates, Consumers Union, the Consumer Federation of

America, and the Center for Auto Safety, are appropriate cy pres recipients for any

residual. Each of these candidates has proposed a project that is consistent with

recent Ninth Circuit jurisprudence in that each project is national in scope and is


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sufficiently related to the purpose of this lawsuit.17 Information about these

proposed cy pres recipients and their proposed use of any cy pres funds is set forth in

Exhibit J to the Settlement Agreement.

J. ATTORNEYS’ FEES, COSTS, AND INCENTIVE AWARDS

Subject to the Court’s approval, the proceeds of the Settlement Fund will be

used to pay Class Counsel’s attorney fees and costs and to provide incentive awards

to the Class Representatives. Ex. 1 ¶18. Unlike many class-action settlements, the

Settlement Agreement does not include a “clear-sailing” provision and Apple is free

to make any valid objection it wishes with regard to the requested attorneys’ fees

and/or incentive awards. Ex. 1 ¶ 47.

In connection with Final Approval proceedings, Class Counsel will move for

attorneys’ fees and reimbursement of litigation expenses in an amount not to exceed

30% of the Settlement Fund, and incentive awards not to exceed $1,000 for each

Class Representative. E.g., Ex. 1 at Ex. B. At that time, Class Counsel will provide

the Court with complete support for their request for fees and expenses, including

detailed information regarding the work they performed and how that work

contributed to this outstanding settlement. Class Counsel note preliminarily,

however, that the Ninth Circuit uses a “25% benchmark rate” as “a starting point

for analysis” for class action fee requests. Vizcaino v. Microsoft Corp., 290 F.3d

1043, 1048 (9th Cir. 2002); see Hanlon v. Chrysler Corp., 150 F.3d 1011, 1029 (9th

Cir. 1998) (“This circuit has established 25% of the common fund as a benchmark

17 “To ensure that the settlement retains some connection to the plaintiff class and the underlying claims, … a cy pres award must qualify as ‘the next best distribution’ to giving the funds directly to class members.” Dennis v. Kellogg Co., 697 F.3d 858, 865 (9th Cir. 2012) (quoting Six Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301, 1305 (9th Cir. 1990)). There must be a “‘driving nexus between the plaintiff class and the cy pres beneficiaries.” Id. (citing Nachsin v. AOL, LLC, 663 F.3d 1034, 1038 (9th Cir. 2011)). “A cy pres award must be ‘guided by (1) the objectives of the underlying statute(s) and (2) the interests of silent class members’ … and must not benefit a group ‘too remote from the plaintiff class.’” Id. (citing Six Mexican Workers, 904 F.2d at 1308).


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award for attorney fees.”). Courts adjust the benchmark figure “upward or

downward” “to fit the individual circumstances” of the specific case. Paul, Johnson,

Alston & Hunt v. Graulty, 886 F.2d 268, 272, 273 (9th Cir. 1989). Factors to be

considered in adjusting the benchmark include the degree of success counsel

achieved for the class, the risks involved in the litigation, the skill required and the

quality of the work performed, including generation of “benefits beyond the cash

settlement fund,” the contingent nature of the fee, the market rate for similar work,

and the financial burden carried by class counsel. Vizcaino, 290 F.3d at 1048-50.

As shall be discussed in detail in Class Counsel’s fee motion, each of these

factors supports an upward adjustment of the benchmark in this case, and the

Ninth Circuit has repeatedly affirmed fee awards exceeding the 25% benchmark. Id.

at 1050 (affirming award of 28% of common fund); Linney v. Cellular Alaska

Partnership, 151 F.3d 1234 (9th Cir. 1998) (affirming award of 30% of common

fund); In re Pacific Enterprises Sec. Litig., 47 F.3d 373, 379 (9th Cir. 1995)

(affirming award of 33.3% of common fund). In fact, “[a] fee award of 30 percent is

within the ‘usual range’ of fee awards that Ninth Circuit courts award in common

fund cases.” Garner v. State Farm Mut. Auto. Ins. Co., 2010 WL 1687829, *1 (N.D.

Cal. Apr. 22, 2010) (citing Vizcaino, 290 F.3d at 1047). Here, Class Counsel’s

request for a percentage of the fund shall cover both fees and costs. Ex. 1 ¶ 47.

Also by way of a separate motion, Class Counsel will ask the Court to award

the Class Representatives an incentive award for their services on behalf of the

Settlement Class. As this Court recently held: “Trial courts have discretion to

award incentives payments to class representatives …. A request of $5,000 per

named plaintiff is presumptively reasonable and appropriate here.” Petersen v.

Lowe’s Hiw, Inc., 2012 U.S. Dist. LEXIS 123018 (N.D. Cal. Aug. 24, 2012) (citing In

re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 463 (9th Cir. 2000). Although the

Settlement Agreement sets an upper limit of $ 5,000 on the award Class Counsel

may seek for each Class Representative (except for plaintiffs Pennington and White,


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who will receive a single, joint award for their jointly-owned device), Class Counsel

and the Representative Plaintiffs are limiting the incentive award request to a

modest $1,000 each (with Plaintiffs Pennington and White sharing a single award)

in light of the Ninth Circuit’s recent decision in Radcliffe v. Experian Solutions,

Inc., ___ F.3d ___, 2013 WL 1715422 (9th Cir. 2013).18

K. ALLOCATION OF THE NET SETTLEMENT FUND

Eligible Settlement Class members will receive a proportionate share of the

Net Settlement Fund (i.e., the amount of the Settlement Fund after payment of

attorney fees and costs and incentive awards to the Class Representatives). Each

eligible Settlement Class Member’s proportionate share will be determined by the

type (i.e., iPhone, iPhone 3G, iPhone 3GS, iPod touch) and configuration (i.e., 8, 16,

32 or 64 gigabytes) of the device for which Settlement Class Members sought

warranty coverage from Apple, as reflected by the chart below. Ex. 1 ¶ 33. These

amounts represent the average amounts paid to Apple for replacement of each

device type and configuration, as determined by Apple’s records. Id.

The exact amount that each eligible Settlement Class Member will receive

may be higher or lower than the amounts shown in the chart below, depending on

the total number of Settlement Class Members eligible for payment and the type

and configuration of their devices. Id. In no event, however, will any Settlement

Class Member receive a payment for more than 200% of the amount shown in the

chart below for their device type and configuration. Id.

18 The briefing schedule will require that Class Counsel’s Petition for Counsel Fees, Costs, and Incentive Awards will be filed before the deadline for Settlement Class Members to file objections or opt-out requests. See In re Mercury Interactive Corp. Sec. Litig., 618 F.3d 988, 993 (9th Cir. 2010).


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Device Type & Configuration Amount

iPhone 4GB $215 8GB $260

16GB $300

iPhone 3G 8GB $215

16GB $215

iPhone 3GS 16GB $215 32GB $215

iPod touch 8GB $160

16GB $215 32GB $265

iPod touch (2nd Gen) 8GB (Sep ’08) $125 8GB (Sep ‘09) $105

16GB $160 32GB $210

iPod touch (3rd Gen) 32GB $160 64GB $215

This allocation plan was agreed to by the parties after they reached

agreement on the amount of the Settlement Fund, and then only after extensive

discussion between the parties with substantial assistance from Judge Infante and

Ms. Yanni. Micheletti Decl. ¶ 55.

III. ARGUMENT

A. THE CRITERIA THAT APPLY TO PRELIMINARY APPROVAL

It is well established that settlements are favored, particularly those

involving class actions in which substantial resources can be conserved by avoiding

the time, cost, and uncertainty of prolonged litigation. See, e.g., Officers for Justice


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v. Civil Serv. Comm’n, 688 F.2d 615, 625 (9th Cir. 1982) (“voluntary conciliation and

settlement are the preferred means of dispute resolution. This is especially true in

complex class action litigation . . .”), cert. denied, 459 U.S. 1217 (1983); Van

Bronkhorst v. Safeco Corp., 529 F.2d 943, 950 (9th Cir. 1976) (“there is an

overriding public interest in settling and quieting litigation. This is particularly

true in class action suits . . .“).

Federal Rule of Civil Procedure 23(e) requires judicial approval of any

proposed class-action settlement. The approval process takes place in two stages,

the first of which is preliminary approval. At this stage, the Court “must peruse the

proposed compromise to ratify both the propriety of the certification and the

fairness of the settlement.” Staton v. Boeing Co., 327 F.3d 938, 952 (9th Cir. 2003);

see also MANUAL FOR COMPLEX LITIGATION § 21.632 (4th ed. 2004) (courts must

“make a preliminary determination on the fairness, reasonableness, and adequacy

of the settlement terms and must direct the preparation of notice of the … proposed

settlement, and date of the final fairness hearing”).

This Court has recognized that a proposed settlement is provisionally

considered to be fair, reasonable, and adequate and preliminary approval should be

granted if “[1] the proposed settlement appears to be the product of serious,

informed, noncollusive negotiations, [2] has no obvious deficiencies, [3] does not

improperly grant preferential treatment to class representatives or segments of the

class, and [4] falls with the range of possible approval ….” Fraley, 2012 WL

5838198 at *1 n.1 (citations and inner quotation marks omitted). As this Court has

also explained, “some of the factors bearing on the propriety of a settlement cannot

be assessed prior to the final approval hearing, ‘a full fairness analysis is

unnecessary at this stage.’” Id. (citation omitted). In other words, at this stage the

Court merely decides whether to notify Settlement Class Members “of the proposed

settlement and to proceed with a fairness hearing[,]”which is the second stage of the

approval proceedings. Gatreaux v. Pierce, 690 F.2d 616, 621 n. 3 (7th Cir. 1982).


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In determining whether a settlement appears to be the product of serious,

informed, noncollusive negotiations, courts consider whether the negotiations

occurred at arm’s length, whether sufficient discovery or investigation took place,

and whether the proponents of the settlement are experienced in similar litigation.

Staton, 327 F.3d at 952; 2 Alba Conte & Herbert Newberg, NEWBERG ON CLASS

ACTIONS § 11.41 (2006 ed.). Indeed, “[i]f the Court finds that the Settlement is the

product of arm’s length negotiations conducted by experienced counsel

knowledgeable in complex class litigation, the Settlement will enjoy a presumption

of fairness. Once the Settlement is presumed fair, ‘it is not for the Court to

substitute its judgment as to a proper settlement for that of such competent counsel

. . . .’” In re Austrian & German Bank Holocaust Litig., 80 F. Supp. 2d 165, 173-74

(S.D.N.Y. 2000) (citation omitted; emphasis added). Accord Adoma v. Univ. of

Phoenix, Inc., 2012 WL 6651141, *9 (E.D. Cal. Dec. 20, 2012) (“‘A settlement

following sufficient discovery and genuine arms-length negotiation is presumed

fair’”) (quoting National Rural Telecom. Coop. v. DIRECTV, Inc., 221 F.R.D. 523,

528 (C.D. Cal. 2004); Bellows v. NCO Fin. Sys., Inc., No. 07-CV-01413, 2008 WL

5458986 (S.D. Cal. Dec. 10, 2008) (same); Cellphone Termination Fee Cases, 180

Cal. App. 4th 1110, 1117-18 (2009) (discussing presumption of fairness and citing

cases supporting same).

While the inquiry at this stage of the settlement proceedings is properly

confined to the Court’s discretion, “the trial judge, absent fraud, collusion, or the

like, should be hesitant to substitute its own judgment for that of counsel.” Cotton

v. Hinton, 559 F.2d 1326, 1330 (5th Cir. 1977). Accord DIRECTV, 221 F.R.D. at 528

(citing Hinton). “After a preliminary fairness evaluation, class members must

receive notice and have an opportunity to be heard as to the terms of the proposed

settlement. Preliminary approval is appropriate so long as the proposed settlement

falls ‘within the range of possible judicial approval.’” Durham v. Cont’l Cent. Credit,

Inc., 2011 WL 90253, *2 (S.D. Cal. Jan. 10, 2011) (quoting Alba Conte & Herbert B.


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Newberg, NEWBERG ON CLASS ACTIONS § 11.25 (4th ed. 2002)).

At the second stage of the approval process, the Court conducts a fairness

hearing to consider arguments in support of and in opposition to approval of the

settlement. Staton, 327 F.2d at 952. The fairness hearing, however, is not “a trial

or rehearsal for trial on the merits.” Officers for Justice, 688 F.2d at 625.

As Plaintiff will demonstrate at the fairness hearing, the proposed settlement

easily satisfies each and every criterion for final approval. At this point, however,

Plaintiff asks only that the Court take the first step in the process and grant

preliminary approval of the settlement so that notice may be distributed to the

Settlement Class.

B. THE PROPOSED SETTLEMENT IS ENTITLED TO A PRESUMPTION OF FAIRNESS BECAUSE IT IS THE PRODUCT OF INFORMED, NONCOLLUSIVE NEGOTIATION BY EXPERIENCED COUNSEL

As explained above, the creation of the $53 million Settlement Fund was the

product of extensive litigation, a series of hotly-contested mediation sessions (which

took place as litigation continued), and a multitude of interim settlement

negotiations conducted by experienced counsel. See, e.g., Micheletti Decl. ¶¶ 5, 40-

50 & Exs. 2-7 (Class Counsel firm resumes). Settlement discussions did not

commence until Class Counsel had conducted substantial investigation and

discovery, which enabled them to make informed decisions throughout the

settlement process. Id.

As a result of those efforts, the parties were well informed about every issue

in this case before mediation began in October 2011. Id. Each side was represented

by counsel who are intimately familiar with the underlying legal and factual issues

as a result of decades of experience with this type of litigation, and negotiations

took place with the assistance of experienced and capable mediators.19 Id. Because

19 That settlement negotiations took place with the assistance of mediators constitutes another basis for presuming the fairness of the settlement agreement.


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settlement discussions were so contentious, formal discovery continued unabated

from the first mediation session in October 2011 until the parties ultimately agreed

on a settlement amount in January 2012. Id. Substantial confirmatory discovery

took place between January and June 2012, and additional confirmatory discovery

efforts have continued since then. Id. The Settlement Agreement was not finalized

or signed by Apple until April 10, 2013. Id. In short, it is an understatement to say

that these settlement negotiations were conducted at arms’ length.

1. The Settlement Has No Obvious Deficiencies

As discussed above, Class Counsel spent a considerable amount of time

negotiating and drafting a Settlement Agreement that provides extraordinary

benefits to Settlement Class Members in an easy-to-understand, straightforward

manner, without subjecting a single Settlement Class member to any undue

burden. Moreover, the Settlement will result in a substantial recovery to the

Settlement Class.

2. The Settlement Does Not Improperly Grant Preferential Treatment to Class Representatives or Segments of the Settlement Class

The Settlement treats each Class Representative and all similarly situated

Settlement Class Members equally, thus it warrants preliminary approval. As

discussed above, each eligible Settlement Class Member who complies with the

terms of the Settlement Agreement will receive a proportionate share of the Net

Settlement Fund—regardless of whether he or she purchased a replacement Class

Device—in an amount that is based on the average amounts paid to Apple for

replacement of the type and configuration of the device for which each Settlement

Class Member sought warranty coverage. In other words, the Settlement

Agreement is designed to provide each Settlement Class Member with the

See, e.g., In re Austrian and German Bank Holocaust Litig., 80 F. Supp. 2d at 174 (settlement is presumptively fair where negotiations are overseen by mediator).


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proportionate share of the average cost of the replacement devices they would have

received under the Apple warranties.

The only difference between the treatment of Settlement Class Members

involves the process of obtaining a cash payment: Because Apple has all of the

information in its records necessary to verify the eligibility of Direct-Payment

Settlement Class Members for payment, these Settlement Class members do not

need to submit a claim form. If a postal address is available through Apple’s

records, as updated by KCC, a check will be mailed. If an email address is

available, Direct-Payment Settlement Class Members need only supply a postal

address to be mailed a check. All other Settlement Class Members will be

considered Claims-Made Settlement Class Members because Apple does not possess

sufficient information needed to verify their eligibility for payment or for the

Settlement Administrator to send them a check. Accordingly, they will be required

to supply the missing information by filling out and submitting a user-friendly

online Claim Form (or a user-friendly hardcopy claim form, if they so choose).

Again, however, payments to both groups will be calculated in the same manner,

thus no individual Settlement Class Member will receive more or less simply

because of his or her status as a Direct Payment Settlement-Class Member or a

Claims-Made Settlement Class Member.

3. The Terms of the Proposed Settlement are Fair, Reasonable and More Than Adequate

Preliminary approval may be granted where the proposed settlement “falls

within the range of possible approval.” In re Tableware Antitrust Litig., 484

F.Supp.2d 1078, 1079-80 (N.D. Cal. 2007) (citing MANUAL FOR COMPLEX LITIGATION,

Second § 30.44 (2d ed. 1985)). In making that evaluation, the Court should consider

“plaintiffs’ expected recovery balanced against the value of the settlement offer.” Id.

Put differently, to arrive at a fair settlement amount in compensation for past

damages, the plaintiffs’ potential recovery at trial must be estimated, and then


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appropriate discounts applied for the uncertainties, risks, and costs of litigation.

See Fraley, 2012 WL 5838198 at *3. The $53 million settlement here falls well

within the range of possible approval.

Warranty claims are submitted to Apple in two ways: (a) by delivering the

Class Device to the Apple Call Center by mail; or (b) by making an appointment

with the Genius Bar at an Apple retail store. Warranty claims processed through

Apple’s mail-in Call Center were necessarily documented and logged into Apple’s

warranty database. Micheletti Decl. ¶ 56. Apple’s corporate policy was that

complete information for all Class Devices tendered for repair or replacement at a

retail store should be logged into the records database, but not every individual

service technician followed Apple’s protocol. Id. ¶ 57. Consequently, an estimate of

potential damages had to include an estimate of the number of denied claims that

may not be completely reflected in Apple’s records. Id.

Apple’s records contain sufficient information to identify approximately

153,105 specific Class Devices that were presented for warranty coverage by

Settlement Class Members whose warranty claims were denied pursuant to Apple’s

Former Liquid Damage Policy. Id. ¶ 58. To the extent Apple’s records contain

contact information for these individuals, they are Direct-Payment Settlement

Class Members who are eligible to receive their proportionate share of the

Settlement Fund without having to submit claim forms. Id. To date, Apple’s

records reflect potential postal and/or email addresses associated with

approximately 130,000 of the approximately 153,105 Class Devices. Id.

The average value of the potential 153,105 claims associated with these

devices is approximately $31.2 million. Id. ¶ 59. More specifically, of the

Approximately 153, 105 Class Devices, Apple’s records show that Settlement Class

Members paid $23,988,870.88 to purchase 117,658 replacement devices from Apple,

or a weighted average of $203.89 per device (“Purchasers”). Id. According to

Apple’s records, Settlement Class Members who owned the other 35,447 Class


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Devices did not purchase a replacement device from Apple (“Non-Purchasers”). Id.

¶ 60. These Settlement Class Members are entitled to proportionate share of the

Net Settlement Fund based on the average replacement cost of the Class Device

they owned, which would total approximately $7,211,129.12, using the weighted

average replacement amount of $203.89. Thus, the potential damages associated

with all 153,105 Class Devices based on the weighted average replacement cost of

Class Devices are approximately $31.2 million. Id. ¶ 60.

During settlement negotiations, Class Counsel asserted that recoverable

damages must account for an estimated number of additional class members for

whom complete information may not have been recorded, and who would be

additional Claims-Made Settlement Class Members. Id. ¶ 61. Specifically, Class

Counsel used the ratio of Purchasers to Non-Purchasers through the Call Center

channel to estimate a number of Non-Purchasers at Apple retail stores for whom

complete information may not have been recorded by Apple customer service

personnel. Id. Apple has pointed out that this approach overstates the total

potential damages because it is much easier for customers to purchase a

replacement device through the Apple retail stores and, therefore, the ratio of

Purchasers to Non-Purchasers through the Call Center is not correlated with the

ratio at Apple retail stores. Id. ¶ 62.

The result is that estimated total damages range from some amount more

than $31.2 million at the low end of the spectrum, to approximately $112 to $147

million at the high end, depending on the specific data points and methodology

used. Id. ¶ 63. The low-end estimate would mean that Apple personnel recorded

complete information for nearly all of the Class Devices for which warranty

coverage was denied under its Former Liquid Damage Policy at Apple retail stores,

and the highest estimate of $147 million would mean that Apple personnel failed to

record complete information for approximately 97% of the Class Devices for which

warranty coverage was denied under its Former Liquid Damage Policy at Apple


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stores. Id.

Regardless of whether the actual number is nearer the high end, nearer the

low end, or something in between, the settlement Class Counsel have achieved in

this litigation, which represents 36% of the high estimate and well over 100% of the

low end, is—by orders of magnitude—far better than that achieved in many

settlements that have been found reasonable and adequate.

The Ninth Circuit has held that “a cash settlement amounting to only a

fraction of the potential recovery will not per se render the settlement inadequate or

unfair.” See, e.g., In re Mego Fin. Corp. Sec. Litig., 213 F.3d at 459 (cash settlement

of one-sixth the amount of potential recovery was fair and adequate); Officers for

Justice v. Civil Service Com., 688 F.2d 615, 628 (9th Cir. 1982) (same); In re Veritas

Software Corp. Sec. Litig., 2005 U.S. Dist. LEXIS 30880 (N.D. Cal. Nov. 15, 2005)

(citing article that that from 1991 to 2003, the median percentage of losses paid in

settlement ranged from 2.7% to 7.2%).

Here, the $53 million Settlement Fund represents a significant percentage of

the Settlement Class Members’ estimated total potential recovery if Plaintiffs

prevailed at every stage of this litigation—including class certification, trial and

appeals—without applying any discounts for the significant uncertainties, risks,

and costs of this litigation. As such, the $53 million settlement Class Counsel have

negotiated readily satisfies the standards for preliminary approval.20

20 See also Shlensky v. Dorsey, 574 F.2d 131, 147-48 (3d Cir. 1978) (“15% of the maximum amount of unlawfully disbursed corporate funds alleged to be involved in the suit, can hardly be said to provide a grossly inadequate benefit to Gulf in view of the uncertainties of this litigation”); White v. Experian Info. Solutions, Inc., 803 F. Supp. 2d 1086, 1098 (C.D. Cal. 2011) (settlement of case involving potential $1 billion damage award for $45 million was fair, adequate and reasonable, regardless of lack of no-reversion provision); In re Checking Account Overdraft Litigation, 830 F.Supp.2d 1330, 1346 (S.D. Fla. 2011) (settlement amount equal to between 9% and 45% of total potential recovery is fair and reasonable); In re Cendant Corp. Derivative Action Litig., 232 F. Supp. 2d 327, 336 (D.N.J. 2002) (“The settlement of $54 million represents less than two percent of that amount, a small percentage. This amount may be justifiable, however, given the fact that the Settling Defendants appear to have significant defenses that increase


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As discussed above, although Plaintiffs and their counsel firmly believe that

the claims asserted in this action have substantial merit, there was a very real risk

of loss for both sides that augured in favor of reaching a settlement—including,

inter alia, the vigorously disputed and complex nature of the legal and technical

issues, the expense involved with sorting them out for trial, the substantial

amounts of time and expense that would be involved with taking this action to trial

and through appeal, and the absence of prior case law or litigation dealing with the

specific scenario at issue in this case.

C. THE COURT SHOULD CERTIFY THE SETTLEMENT CLASS

The Court must first determine whether the Settlement Class is appropriate

for certification under Fed. R. Civ. P. 23. Amchem Prods. v. Windsor, 521 U.S. 591,

620 (1997); see also MANUAL FOR COMPLEX LITIGATION § 21.632. A class action may

be certified if it meets four prerequisites identified in Federal Rule of Civil

Procedure 23(a)—“(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”—and the predominance and superiority criteria of Rule 23(b).

Hanlon v. Chrysler Corp., 150 F.3d 1011, 1020, 1022 (9th Cir. 1998).21

The Settlement Class is defined in the Settlement Agreement as follows:

all United States residents who are or were owners of a Class Device (a) that was tendered to Apple in the United States for repair or replacement during the Relevant Time Period; (b) at the time of tender, the Class Device was within either the one-year limited warranty period or, if covered by an AppleCare Protection Plan, the

the risks of litigation”); Wershba v. Apple Computer, Inc., 91 Cal. App. 4th 224, 250 (2001) (“the test is not the maximum amount plaintiffs might have obtained at trial on the complaint, but rather whether the settlement is reasonable under all of the circumstances”).

21 The “court need not inquire whether the case, if tried, would present intractable management problems, Fed. R. Civ. P. 23(b)(3)(D), for the proposal is that there be no trial.” Amchem, 521 U.S. at 621.


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two-year plan coverage period; and (c) repair or replacement of the tendered Class Device was denied by Apple on the basis of Apple’s Former Liquid Damage Policy.

Ex. 1 ¶ JJ.22 Thus, the Settlement Class is “identifiable and ascertainable” and the

class definition is “precise, objective, and presently ascertainable.” Gray v. Golden

Gate Recreational Area, 279 F.R.D. 501, 508 (N.D. Cal. 2011).

1. Numerosity is Satisfied

Rule 23(a)(1) requires that the class be so numerous, joinder of all class

members would be “impracticable.” Fed. R. Civ. P. 23(a)(1). To satisfy this

requirement, Plaintiffs “need not state the exact number of potential class

members, nor is there a specific number that is required.” In re Facebook, Inc., PPC

Advertising Litig., 282 F.R.D. 446, 452 (N.D. Cal. 2012). “[C]ourts generally find

that the numerosity factor is satisfied if the class comprises 40 or more members.”

Id. (class consisting of more than 100,000 members “well over the threshold for

‘numerosity’”). Here, there are up to approximately 153,105 Direct-Payment

Settlement Class members alone. Accordingly, numerosity is readily satisfied.

2. Commonality is Satisfied

Rule 23(a)(2) requires that “there are questions of fact or law common to the

class.” Fed. R. Civ. P. 23(a)(2). Commonality may be demonstrated when the claims

of all class members “depend on a common contention” and “even a single common

question will do.” Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551, 2556 (2011)

(quotation omitted). The common contention must be such that the “determination

of its truth or falsity will resolve an issue that is central to the validity of each one

of the claims in one stroke.” Id. at 2551. “The existence of shared legal issues with

22 “The Settlement Class excludes counsel for the parties and members of their immediate families; Apple; any entity in which Apple has a controlling interest; Apple’s directors, officers, and employees; Apple’s legal representatives, successors, and assigns; the presiding Judges in the Federal and State Actions; and all persons who validly request exclusion from the Settlement Class.” Ex. 1 ¶ 1.JJ.


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divergent factual predicates is sufficient, as is a common core of salient facts

coupled with disparate legal remedies within the class.” Hanlon, 150 F. 3d at 1019.

Put differently, even where the “circumstances of each particular class member vary

but retain a common core of factual or legal issues with the rest of the class,

commonality exists.” Parra v. Bashas, Inc., 536 F.3d 975, 978-79 (9th Cir. 2008).

Here, each Settlement Class Member was denied warranty coverage

pursuant to Apple’s Former Liquid Damage Policy and there are at least two basic

issues that are common to the entire Settlement Class: (1) whether Apple has

breached its warranties and the implied covenant of good faith and fair dealing by

using external LSIs as the sole basis to deny warranty claims; and (2) whether

advising customers that a red or pink LSI establishes that a Class Device had been

damaged by liquid constitutes common-law fraud and violations of the CLRA and

UCL. Regardless of which side is correct, these issues are common to each and

every Settlement Class Member based on common evidence. Accordingly,

commonality is satisfied.

3. Typicality is Satisfied

Rule 23 (a)(3) requires that “the claims or defenses of the representative

parties are typical of the claims or defenses of the class.” Fed. R. Civ. P. 23(a)(3).

Typicality ensures that “the interests of the named representatives align with the

interests of the class.” Wolin v. Jaguar Land Rover N. Am. LLC, 617 F.3d 1168,

1175 (9th Cir. 2010) (citations omitted). “The test of typicality is whether other

members have the same or similar injury, whether the action is based on conduct

which is not unique to the named plaintiffs, and whether other class members have

been injured by the same course of conduct.” Id. (citations omitted). Typicality does

not require that the representative’s claims be identical, but only that they are

“reasonably co-extensive with [the claims] of absent class members.” Hanlon, 150

F.3d at 1020. Typicality is satisfied if the class representative’s claims arise from

the same course of conduct and are based on the same legal theory as the class’s


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claims. Kanawi v. Bechtel Corp., 254 F.R.D. 102, 110 (N.D. Cal. 2008).

As discussed above, the entire Settlement Class is affected by the same

conduct—the use of external LSIs as the sole basis for declining warranty

coverage—and each Class Representative has been affected by that conduct in the

same way that every other Settlement Class Member has been affected: by having

their warranty deemed void because the Liquid Submersion Indicator in their Class

Devices were pink or red. Plaintiffs Gallion, Corsi, White and Pennington owned

various iterations of the iPhone and Plaintiff Johal owned an iPod touch, just as the

rest of the Settlement Class. Micheletti Decl ¶ 4. Each Class Representative’s

claim is identical to the claims of every other Settlement Class Member since all

were entitled to a free replacement Class Device but did not receive one.23

4. Adequacy of Representation is Satisfied

The proposed Class Representatives and Class Counsel must “fairly and

adequately protect the interests of the class.” Fed. R. Civ. P. 23(a)(4). This

prerequisite requires the Court to consider two questions: “(1) do the named

plaintiffs and their counsel have any conflicts of interest with other class members

and (2) will the named plaintiffs and their counsel prosecute the action vigorously

on behalf of the class?” Hanlon, 150 F.3d at 1020. As discussed in Section III.C.2.,

above, the Class Representatives’ interests are identical to those of the Settlement

Class, thus there are no conflicts of interest. Moreover, the record demonstrates

that Class Counsel and the Class Representatives have prosecuted, and will

continue to prosecute, this case vigorously, effectively, and in the best interests of

the Settlement Class.

23 While some Settlement Class Members, like the Class Representatives, chose to purchase a replacement device, others may not have purchased a replacement. But the fact remains that none of the class members received a free replacement to which they were entitled under the warranties.


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5. Predominance is Satisfied

The Settlement Class also satisfies the “predominance” criterion, which

requires “the questions of law or fact common to class members predominate over

any questions affecting only individual members.” Fed. R. Civ. P. 23(b)(3). A class

fits into Rule 23(b)(3) when it is “sufficiently cohesive to warrant adjudication by

representation,” Amchem, 521 U.S. at 623, and “the actual interests of the parties

can be served best by settling their differences in a single action[,]” Hanlon, 150

F.3d at 1022 (citations omitted). The Settlement Class is limited to consumers who

had their warranty claims denied by Apple due to Apple’s Former Liquid Damage

Policy, which applied to all Class Devices. The effectiveness of the external LSIs

and propriety of using them as the sole basis to deny warranty claims is a common

question that, if the case had proceeded to trial, would have been resolved based on

common evidence. These “common questions present a significant aspect of the case

…[that] can be resolved for all members of the class in a single adjudication.”

Hanlon, 150 F.3d at 1022; see also Amgen, Inc. v. Connecticut Retirement Plans and

Trust Funds, 133 S.Ct. 1184, 1191 (2013) (“Rule 23(b)(3) requires a showing that

questions common to the class predominate, not that those questions will be an-

swered, on the merits, in favor of the class”).

6. Superiority is Satisfied

The Settlement Class satisfies the “superiority” prerequisite, which requires

that “a class action is superior to other available methods for fairly and efficiently

adjudicating the controversy.” Fed. R. Civ. P. 23(b)(3). The superiority criterion’s

purpose is the promotion of judicial economy and the assurance that a class action

is the “most efficient and effective means of resolving the controversy.” Wolin, 617

F.3d at 1175. A class action is superior when it “will reduce litigation costs and

promotes greater efficiency,” Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1234

(9th Cir. 1996), and “no realistic alternative exists” for managing the class

members’ claims, id. at 1234-35.


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Here, each Class Representative’s experience demonstrates that neither they

nor the Settlement Class Members whose interests they represent would have

received relief from Apple if the Class Representatives had not brought this case as

a class action. Prior to commencing litigation, each Class Representative sought

warranty coverage from Apple, but Apple refused to provide it based on its Former

Liquid Damage Policy. See, e.g., Comp. ¶¶ 37-42, 46-49, 54-56; Micheletti Decl ¶ 4

and nn. 1-2.

Class Counsel also served pre-litigation CLRA letters that provided Apple an

opportunity to provide appropriate financial compensation to class members

without class litigation, but negotiations pursuant to the CLRA notice-and-demand

process were unsuccessful. .A Complaint Mr. Johal filed with the Consumer

Protection Division of the Washington Attorney’s General office was also

unsuccessful. Micheletti Decl. ¶ 4 & n. 2. Another Class Representative (Mr.

Pennington) specifically informed Apple that unless it provided him with the free

replacement to which he was entitled, he would be forced to file a class action,

which he ultimately had to do. Id.

There is no question that adjudicating hundreds of thousands of virtually

identical claims in one proceeding is vastly superior to trying each claim

individually. The cost of discovery alone would preclude the prosecution of

individual actions, particularly when considered in light of the fact that even if

individuals were willing to spend the time and money on obtaining the information

needed to support their claims, they would also require the help of expensive

experts to make sense of the highly technical nature of that evidence. Moreover,

finding counsel who are skilled enough to successfully oppose the exceedingly

experienced and qualified attorneys Apple has hired—for a fee that accounts for the

fact that the weighted average recovery in an individual action would be about

$204—would be virtually impossible.


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As a result, class-action litigation represented the only viable vehicle to

prosecute and obtain a meaningful recovery for Settlement Class Members’ claims.

D. Class Counsel Satisfy the Requirements of Rule 23(g)

Rule 23(c)(1)(B) provides that “[a]n order that certifies a class action ... must

appoint class counsel under Rule 23(g).” Fed. R. Civ. P. 23(c)(1)(B). Rule 23(g), in

turn, provides “a court that certifies a class must appoint class counsel.” Fed. R.

Civ. P. 23(g). Further, "[i]n appointing class counsel, the court: (A) must consider:

(i) the work counsel has done in identifying or investigating potential claims in the

action; (ii) counsel’s experience in handling class actions, other complex litigation,

and the types of claims asserted in the action; (iii) counsel’s knowledge of the

applicable law; and (iv) the resources that counsel will commit to representing the

class.” Fed. R. Civ. P. 23(g)(1)(A).

Here, Class Counsel have decades of experience representing Plaintiffs in

class actions and other forms of complex litigation. See Micheletti Decl. Exs. 2-

7. Class Counsel’s knowledge of the applicable law, the time and resources they

committed to the prosecution of this case, and the work they did in diligently

prosecuting it from pre-filing through settlement is described in detail above and is

best exemplified by the result achieved.

For these reasons, the Court should appoint Co-Lead Counsel, State Liaison

Counsel, and Class Counsel as provided in the proposed Order accompanying this

Motion.

E. THE PROPOSED NOTICE PLAN SATISFIES DUE PROCESS AND WARRANTS APPROVAL

Rule 23 requires the Court to “direct notice in a reasonable manner to all

class members who would be bound by the proposal,” Fed. R. Civ. P. 23(e)(1), which

includes “the best notice that is practicable under the circumstances, including

individual notice to all members who can be identified through reasonable effort.”

Fed. R. Civ. P. 23(c)(2)(B).


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With respect to the method of notice, Rule 23 does not require individual

notice to all class members; it only requires individual notice to those class

members who can be identified through “reasonable” effort. See Fed. R. Civ. P.

23(c)(2)(B). “There is no statutory or due process requirement that all class

members receive actual notice by mail or other means; rather, individual notice

must be provided to those Class members who are identifiable through reasonable

effort.” Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 175 (1974). Where individual

notice to all class members is impracticable, publication notice may be the best

notice practicable. See, e.g., In re Tableware Antitrust Litig., 484 F. Supp. at 1080.

With respect to content, notice is sufficient if it “adequately apprise[s] class

members of all material elements of the settlement agreement.” Lane v. Facebook,

Inc., 696 F.3d 811, 826 (9th Cir. 2012). Rule 23 specifies as follows:

The notice must clearly and concisely state: (i) the nature of the action; (ii) the definition of the class certified; (iii) the class claims, issues, or defenses; (iv) that a class member may enter an appearance through an attorney if the member so desires; (v) that the court will exclude from the class any member who requests exclusion; (vi) the time and manner for requesting exclusion; and (vii) the binding effect of a class judgment on the merits under Rule 23(c)(3).

Fed. R. Civ. P. 23(c)(2)(B).

In addition, the notice must inform the class of class counsel’s request for an

award of attorneys’ fees and reimbursement of costs. Fed. R. Civ. P. 23(h)(1). The

notice must also be written in a way that can be “understood by the average class

member.” NEWBERG, § 11:53. The content and distribution method of the proposed

Class Notice satisfies these statutory and due process requirements.

Content: With respect to content, the parties have drafted seven versions of

the Class Notice: detailed notice, published notice, two types of postcard notice, and

three types of emailed notice. See Ex. 1 at Exs. A - G. Although the various

versions differ in the amount of detail they provide (with the detailed notice


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providing the most complete information, including all of the information specified

in Fed. R. Civ. P. 23(c)(2)(B) and 23(h)(1)), all versions of the Class Notice are

written in plain English and apprise Settlement Class Members of the nature of the

action; the amount of the Settlement Fund; the definition of the Settlement Class;

the right to object, opt out, and/or appear at the Final Fairness Hearing and the

relevant dates; the fact that the Settlement will be legally binding unless a

Settlement Class Member opts out; and the amount of fees and costs sought by

Class Counsel. Id.

Additionally, each version of the summary notice directs Settlement Class

Members to a website where they can download or call a toll-free number to obtain

a copy of the long-form notice, which contains more complete information. See id.

The website will also include the most recent Federal and State Complaints, papers

in support of preliminary and final settlement approval and Class Counsel’s petition

for attorneys’ fees, expense reimbursement and Class Representative incentive

awards. Ex. 1 ¶ 29.

Distribution Method: The parties’ proposed notice distribution method also

satisfies statutory and due process requirements. It consists of the following:

• Summary Notice to Direct-Payment Settlement Class Members

o Apple will provide the Settlement Administrator (the parties

propose KCC) with available postal mailing and email addresses for the Direct-

Payment Settlement Class Members not later than within 10 days of Conditional

Approval. Ex. 1 ¶ 24. As set forth above, based on preliminary estimates, Apple

has located approximately 130,000 postal and/or email addresses associated with

Class Devices and will continue work to identify address and/or email information

for the remaining roughly 23,000 Class Devices reflected in its records.24

24 The parties anticipate providing the Court with more refined estimates at the hearing on Preliminary Approval. Micheletti Decl ¶ 51.


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o After updating these postal mailing addresses using the

National Change of Address (“NCOA”) database and Accurint, the Settlement

Administrator will mail a postcard summary notice to all Direct-Payment

Settlement Class Members for whom postal mailing addresses are available. Id. ¶¶

25, 26(a) & Ex. D. In addition, the Settlement Administrator will also send these

Class Members a summary notice by email. Id. ¶ 26(a) & Ex. C. The notices to

these Class Members will advise them of the need to check the accuracy of their

postal mailing addresses if they wish to share in the Settlement Fund, with

information on how to update their addresses, and will also advise them that they

may opt out if they choose to do so. See id. Exs. C, D.

o For Direct-Payment Settlement Class Members with incomplete

postal mailing addresses but for whom Apple has an email address, the Settlement

Administrator will send a summary notice by email advising them of the terms of

the settlement, of the need to provide a current postal mailing address if they wish

to share in the Settlement Fund, and of their right to opt out if they choose to do

so.25 Id. ¶ 26(b) & Ex. E.

o Each notice to the Direct-Payment Settlement Class Members

(postal and email) will advise these Class Members that they are eligible to share in

the Settlement Fund without the need to submit a claim form. Ex. 1 at Exs. C, D,

E.

• Summary Notice to Claims-Made Settlement Class Members:

o Claims-Made Settlement Class Members are potential

Settlement Class Members who were denied warranty coverage for liquid damage

25 To the extent that a Class Device is reflected in Apple’s records but Apple

and/or KCC is unable to identify a postal or email address associated with that record, those Class Members will be considered Claims-Made Settlement Class Members and notice will be provided in the same manner as to other all other Claims-Made Settlement Class Members.


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under Apple’s Former Liquid Damage Policy, but, for whatever reason, complete

information is not reflected in Apple’s warranty service database or other records.

Micheletti Decl ¶ 61. In order to provide notice to any of these additional

Settlement Class Members, a summary email notice (see Ex. 1 at Ex. F) will be sent

to the email address in Apple’s records for any person who made an appointment at

an Apple retail store for a Class Device during the relevant time periods. Micheletti

Decl ¶ 64.

o Not later than within 10 days of Conditional Approval, Apple

will provide the Settlement Administrator with the email addresses reflected in the

relevant appointment records. Ex. 1 ¶ 24. This over-inclusive list is believed to

consist of more than four million email addresses, just a subset of which may belong

to people eligible for a payment from the Settlement Fund as Claims-Made

Settlement Class Members. Micheletti Decl. ¶¶ 64-65.

o The Settlement Administrator will send a notice by email to

each of these email addresses. Ex. 1 ¶ 27 & Ex. F. If the emailed notice is returned

as undeliverable and Apple has a postal mailing address for that intended recipient,

the Settlement Administrator will update the address using NCOA and Accurint

and send a postcard summary notice by postal mail. Id. ¶ 27 & Ex. G.

o Each of the notices will advise the recipients that they may be

eligible for benefits from the Settlement Fund, explain how to determine whether

they qualify, and inform them that they will need to submit a claim form, along

with instructions on how to do so. See Ex. 1 at Exs. F, G.

o The Claim Form for these Settlement Class Members is a

simple, easy-to-understand form that can be filled out and submitted entirely online

at the Settlement Website, or printed, filled out and returned by mail. See id. ¶¶

1(C), 27-29 & Exs. H (printable claim form), I (online claim form).

• Detailed Notice: Each summary notice (email and postcard) to be

sent directly to the Settlement Class Members will provide instructions on how to


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obtain a copy of the Detailed Notice. Id. at Exs. A, C-G. The Detailed Notice will

be available for download at the Settlement Website, and will also available upon

request at no charge to Settlement Class Members who call a toll-free number to be

established at Apple’s expense. Id. ¶ 28. The Detailed Notice provides more

information about the Settlement, including details about the proposed allocation of

the Settlement Fund and answers to frequently asked questions. Id. at Ex. A

• Published Notice: In addition to the direct notices to the Settlement

Class Members described above, a published summary notice including the address

of the Settlement Website and the toll-free number shall appear in USA Today and

Macworld. Id. ¶ 30 & Ex. B.

• Settlement Website: The Settlement Administrator shall establish

and maintain a Settlement Website where Settlement Class Members may

download copies of the Detailed Notice, the full Settlement Agreement, and other

relevant documents. Id. ¶¶ 28-29.

• Toll-Free Number: The Settlement Administrator shall establish

and maintain a toll-free number, which will include an interactive voice response

system with answers to frequently asked questions, and which will allow a

Settlement Class Member to be connected to a live operator during regular business

hours. Settlement Class Members will be able to obtain a free copy of the claim

form by postal mail by calling this number. Id. ¶ 28.

• CAFA-Compliant Notice: Pursuant to the Class Action Fairness

Act, notice of the Settlement will be distributed to appropriate officials in all fifty

states. See 28 U.S.C. § 1715(b); Settlement Agreement ¶ 21.

In short, the parties’ proposed Class Notice plan is a comprehensive, multi-

faceted, user-friendly model, which goes well beyond the email-based class notice

plan this Court recently approved in Fraley v. Facebook. For all of the foregoing

reasons, the proposed Class Notice plan satisfies Fed. R. Civ. P. 23(c)(2)(B) and

(e)(1), as well as due process and warrants approval.


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F. THE PARTIES WILL PROPOSE A SCHEDULE FOR THE EVENTS LEADING UP TO THE FINAL FAIRNESS HEARING

Prior to or at the preliminary approval hearing, the parties will propose a

schedule, consistent with Mercury Interactive. Micheletti Decl. ¶ 66. The period

between the preliminary approval hearing and the final fairness hearing will be

chosen to provide consumers sufficient time to decide whether to opt out of the

Settlement Class, to provide potential objectors with sufficient time to review the

papers submitted in support of final approval and in support of Class Counsel’s

petition for the payment of attorneys’ fees and costs and incentive awards to the

named Plaintiffs, and to allow for the completion of the claims submission process,

which will enable the parties and the Court to consider the actual claims rate prior

to the final fairness hearing. Id.

IV. CONCLUSION

This Settlement easily meets the criteria for preliminary approval.

Accordingly, Plaintiffs respectfully request that the Court grant this motion;

preliminarily approve the Settlement terms; conditionally certify the Settlement

Class; approve the appointment of the Class Representatives and Class Counsel;

appoint Co-Lead and State Plaintiffs’ Liaison Counsel; approve and direct the

distribution of Class Notice; and set a schedule for final approval proceedings.

DATED: May 28, 2013 FAZIO | MICHELETTI LLP

by /s/ Jeffrey L. Fazio

Jeffrey L. Fazio (146043) Dina E. Micheletti (184141)

FAZIO | MICHELETTI LLP 2410 Camino Ramon, Suite 315

San Ramon, CA 94583 Telephone: 925-543-2555 Facsimile: 925-369-0344

CHIMICLES & TIKELLIS LLP By: /s/ Steven A. Schwartz Steven A. Schwartz (pro hac vice) Timothy N. Mathews (pro hac vice) 361 W. Lancaster Avenue


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Haverford, PA 19041 Telephone: 610-642-8500 Facsimile: 610- 649-3633

Interim Co-Lead Class Counsel

CAFFERTY CLOBES MERIWETHER & SPRENGEL LLP

By: /s/ Anthony F. Fata

Anthony F. Fata (pro hac vice pending) Daniel O. Herrera (pro hac vice pending) 30 N. LaSalle, Suite 3200 Chicago, IL 60602 Telephone: 312-782-4880 Facsimile: 312-782-4485

Proposed State Plaintiffs Liaison Counsel

Kimberly A. Kralowec (163158) Elizabeth Newman (257329) THE KRALOWEC LAW GROUP 188 The Embarcadero, Suite 800 San Francisco, CA 94105 Telephone: 415-546-6800 Facsimile: 415-546-6801

Earl L. Bohachek (55476) LAW OFFICES OF EARL L. BOHACHEK One Maritime Plaza San Francisco, CA 94111 Telephone: 415-434-8100 Facsimile: 415-781-1034

Rose F. Luzon (221544) James C. Shah (260435)

SHEPHERD, FINKELMAN, MILLER & SHAH, LLP 401 West A Street Suite 2350 San Diego, CA 92101 Telephone: (619) 235-2416 Mark A. Chavez Dan L. Gildor CHAVEZ & GERTLER LLP 42 Miller Avenue Mill Valley, CA 94941 Telephone: 415-381-5599 Facsimile: 315-381-5572 Attorneys for Plaintiffs and the Proposed Class


Documents

3 4 5 pro hac vice CHIMICLES TIKELLIS LLP 361 W. Lancaster … · 2013-11-25 · No. 10-CV-01610 PLAINTIFFS’ NOTICE OF MOTION AND MOTION FOR PRELIMINARY APPROVAL OF SETTLEMENT AGREEMENT