On December 15, 2022, the parties in TransUnion LLC v. Ramirez — a case that went all the way to the Supreme Court in 2021 to resolve questions of Article III standing — obtained final approval of their class settlement agreement. The settlement resolved claims brought under the Fair Credit Reporting Act (FCRA) alleging that TransUnion inaccurately appended an alert to each class member’s consumer report indicating that they were a “potential match” to a name on the Office of Foreign Asset Control’s Specially Designated Nationals and Blocked Persons List.
The district court originally certified a class of over 8,000 individuals, who went on to obtain a $60 million jury verdict. The verdict was overturned, however, when the Supreme Court held that over 75% of the class members lacked Article III standing because they had not demonstrated that they suffered a concrete injury by showing that their consumer reports with the OFAC alerts were ever disseminated to a third party.
After mediation, the parties agreed to not only settle the claims of the class for which the Supreme Court had affirmed certification, but also to provide recovery to any remaining class members who are able to prove through a claims process that their report was published to a third party. The settlement provides for a $9 million total settlement fund, with the amount of each class member’s pro rata share depending on how many valid claims are submitted. Class counsel presented an estimate in their motion for final approval that suggested individual class members would be paid in excess of $2,000. The district court concluded in its final approval order that this settlement amount, “affords a substantial financial recovery for [s]ettlement [c]lass [m]embers who meet the Supreme Court’s new standard for Article III standing,” and noted that the amount exceeds the maximum available statutory damages award.
In addition to approving the $9 million class settlement, the district court approved class counsel’s entire attorneys’ fees request of $4.2 million. In doing so, the court noted that this fee request — which amounted to 44% of the entire class settlement amount — was, “higher than the benchmark for a reasonable award,” and taken alone would raise a “red flag,” but because the amount was only two-thirds of class counsel’s lodestar, “it does not raise a concern regarding collusion.” The settlement also includes a $75,000 service award for the named plaintiff.
Troutman Pepper previously reported on the preliminary approval of this settlement and reported on the Supreme Court’s 2021 decision. We will continue to monitor and provide timely updates on notable developments in FCRA litigation.