albach v. kennedy class action suit - preliminary settlement

7/30/2019 Albach v. Kennedy Class Action Suit - Preliminary Settlement

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WILLIAM J. ALBA CI-I ANDRICHARD J. DODSONVERSUSJOHN K EN NE DY , in his capacity asState Treasurer of Louisiana andAdministrator of Unclaimed PropertyPursuant to R.S. 9:152 and the UniformDisposition of Unclaimed Property

SUIT NO. 450,102 DIVISION A"

19TH JUDICIAL DISTRICT COURT

PARISH OF EAST BATON ROUGE

STATE OF LOUISIANA

III I a u Wi I (S)tI)IPi I t I DKI IPRELIMINARY STATEMENT

A . This action was brought by plaintiffs William J. Albach, Richard J. Dodson,and the class of similarly situated individuals, as more fully described in this HonorableCourt's judgment of January 28, 1999, as a class action under La. C.C.P. Articles 59 IA and5911 3(l)(b). The class currently is defined as all persons who w ere owners of property thatwas surrendered to the State prior to July 10, 19 86 if the property was interest bearing to theowner on the date of surrender by the holder to the adm inistrator of unclaimed p roperty. Inaddition, the class currently also includes all persons who are owners of prop erty that wassurrendered to the administrator of unclaimed property at the date of the class actioncertification when that property w as interest bearing to the holder on the date of surrender tothe State and the State failed to pay or accrue interest thereon pursuant to LSA-R.S. 9:163and the previous versions of that statute.

B. Plaintiffs 1 petition charged in substance that defendant, in his capacity asAd ministrator of Unclaimed Prop erty, as that office is described in the Uniform U nclaimedProperty Act of 1997, LSA-R . S. 9:151, et seq. (the "Act"), had failed, as to certain owners ofunclaimed property that is currently being held by the State or that has already beentransferred from the State to the ow ners thereof, to properly pay o r accrue statutory interestpursuant to LSA -R. S. 9:16 3, and that as a result plaintiffs and other mem bers of the classwere damaged.

C. Plaintiffs requested that, if the defendant has failed to properly pay interest onitems that have been transferred from the State to the class member ow ners thereof (becausethe property was interest bearing to the owner on the date of surrender by the ho lder to theState), they be paid any and all interest due on those items. Plaintiffs also prayed forreimbursement of their costs and expenses and for the allowance of reasonable counsel feesto their attorneys for prosecuting this ac tion.

D . The nam ed defendant has appeared and answered and has denied the materialallegations of plaintiffst petition. The defendant has asserted that it has historically paidinterest on interest bearing savings accounts, matured certificates of deposit, and Christmasclub accounts. Further, the defendant contends not all unclaimed property accounts areinterest bearing and that the burden of proof of demonstrating that an account is interestbearing is on the party claiming the accou nt, not the defendant.

E. This Court, by judgmen t dated January 28, 1999, determined that this action isproperly maintained as a class action under the provisions of La. C .C.P A rticles 59 1(A ) and(13)(1)(b) an d that adjudication with respect to the claims of plaintiffs, as mem bers of thisPage 1 of6ORIGINAL/OF /(,


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class, would as a practical matter be dispositive of the interests of the other m embers o f theclass not currently p arties to this litigation, and that p laintiffs are proper representatives ofthe class. Additionally, this Court rendered ajudgrnent which was signed on November 29,1999 granting the class a partial summary judgment on issues of liability. The relief granted,in pertinent part, was as follows:

IT IS HEREBY OR DERED , ADJUDGED AN D DECREE D, thatthere be judgment herein in favor of W illiam J. A lbach, Richard J. Dodson andthe class of similarly situated individuals previously certified herein byJudgment dated January 2 8, 1999, an d against Brett Crawford, in his capacityas secretary of the Louisiana Department of Revenue and Administrator ofUnclaimed Property, or his successors in office, that all owners of propertywhich w as surrendered to the administrator of unclaimed property prior to July10, 1986 whose property was interest bearing to the owner on the date ofsurrender by the h older to the adm inistrator of unclaimed property are entitledto be paid interest on this property in accordance with the Provisions of La.R.S. 9:163 from the date the property was deposited with the Adm inistrator ofUnclaimed Property through the date that said property was transferred to theowner, subject to the maximum period of ten (10) years from the date ofdeposit.

IT IS FURTHER ORDE RED, ADJUDGED AND DE CREE D thatthere be judgment herein in favor of William J. Albach, Richard J. Dodsonand the class of similarly situated individuals previously certified herein byJudgment dated January 2 8, 1999 , and against Brett Crawford, in his capacityas Secretary of the Louisiana Department of Revenue and Administrator ofUn claimed Properly, or his successors in office, decreeing that a!l owners ofproperty which w as interest bearing to the owner on the date of surrender bythe holder to the administrator of unclaimed property which was surrendered tothe administrator of unclaimedproperty on or after July 10, 1986 who h ave notheretofore been paid interest on their property pursuant to La . R.S. 9:163 areentitled to be paid said interest for the period of time from the date ofsurrender of the property by the holder to the administrator of unclaimedproperty through the day the property was delivered to the own er or throughthe day the property shall be delivered to the owner, subject to the maxim umperiod of ten (10) years from the date of delivered of the property to theadministrator,F.o bring the controversy between plaintiffs (and the class represented byplaintiffs) and defendant to rest, to secure total and final settlement of all claims againstdefendant arising out of the purported acts and omissions set forth in plaintiffst petition, andto avoid further expense, inconvenience, and the distraction and hazard of burdenso me andprotracted litigation, the parties desire to settle and terminate this action and all claimsasserted in it, as well as any other claim against defendant which is based on or might bebased on or arise from an y of the matters alleged in plaintiffs petition, regardless of the legaltheory on which the claim may be based.

TERMS OF SETTLEME NTA.otal Benefit: The pa rties agree, for purposes of this settlement on ly, that thetotal benefit available to the settlement class, including past and future interest, is$15,000,000.00.

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B.l aim s Procedure.: Upon completion of all terms and conditions outlined inthis Stipulation, including but not limited to the suspensive conditions outlined in Section 10of the Procedural Stipulation below, and upo n approval by the court after the satisfaction ofthe suspensive conditions, the defendant shall establish a process, procedure, and form s thatmembers of the settlement class may use to submit claims for interest that the claimantbelieves may be owed to the claimant.

(i ) Forms: The defendant will create forms to be used by those mem bers ofthe settlement class who have already recouped unclaimed property which theybelieve should have been interest bearing to them but were not paid interest by thedefendant when the unclaimed property was returned to the owner. The defendantalso will create forms to be used by those m embers of the settlement class who ha venot yet recouped unclaimed property but who will do so in the future, on whichproperty the claima nt asserts that interest is due.

(ii) No tice: The defendant shall provide notice of this process, procedure,and forms on its website and in publications of the six major newspapers inmetropolitan areas within the State of Louisiana. The co ntent and the frequency andduration of the publication of the process, procedure, and form s shall be done at thediscretion of the defendant p rovided that the publication shall run in each of the sixmajor newspapers at least once every four months over a one year period commencingwith final court approval of this settlement. All parties agree that the cost of theadvertising and administration of the process and procedures will not exceed$200,000.C.ettlement Class: For the purposes of this settlement, the settlement class shallbe defined as all existing class m embers plus:All owners of property that was surrendered to theadministrator of unclaimed property prior to December 31,2011, whose property was interest bearing to the owner, byvirtue of a Louisiana statute or a contract, on the date ofsurrender by the holder to the administrator of unclaimedproperty.D.Evidentiary Rulings: For the purposes of this settlement, any and allevidentiary rulings by the district court, including the 20 11 ruling on spoliation of evidencewill be treated as void. The court, as part of the settlement approval process, shall sign anorder in a form satisfactory to counsel for both plaintiffs and defendant withdrawing andnullifying any and all such orders, judgm ents and rulings. The defendants, upon the signingof such order, shall dismiss (without prejudice and at its cost) its writ application to theLouisiana First Circuit Court of Appeal, Case Num ber 2011 C W 1618.E.nterest:(i ) The defendan t shall pay interest to settlement class mem bers who are (1)able to show to the Administrator's reasonable satisfaction that they are owners ofunclaimed property that has been recouped from the State and (2) able to show to theAdministrator's reasonable satisfaction that they should have been paid interest inaccordance with LSAR.S. 9:163.

(ii) Upo n subm itting satisfactory proof of ownership and the interestbearingnature of the prQperty, the recouping owner m ust submit evidence of the particularinterest rate. If the unclaimed property does not bear interest under the terms ofspecific statute granting such unclaimed property a specific interest rate, then the

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owner of the un claimed property shall submit reasonable proof to the A dministrator ofthe interest rate paid or payable by the holder of the property at the time the unclaimedproperty was turned over to the defendant. In the even t that the recouping own er failsto submit satisfactory proof to the Adm inistrator of such interest rate, the interest rateto be applied will be that rate outlined in the LSA R,S. 9:163 as of the date of transferto the custody of the State.

PROCEDURAL STIPULATIONNO W , TI-IEREFOR E, for the reasons set forth above,It is stipulated by the parties, through their respective counsel, that, (a) subject first tothe completion and satisfaction of all the terms and conditions set forth in the Suspensive

Conditions contained in Section 10, below, and (b) subject second to the approval of thecourt and notice and an opportunity to be heard to be accorded to all class members,including the settlement class, all pursuant to La. C.C P. A rticles 594 and 595:

1 .fter completion of all terms and conditions outlined in this Stipulation,including but not limited to the Suspensive Con ditions outlined in Section 10, an order andfinal judgment shall be entered by the court in accordance with the provisions of thisStipulation.1ach party will comply fully and promptly with all terms and provisions of thesettleinent.3. All claims asserted in this action, and any and all other claims against thedefendant, which are based on or could be based on or could arise from any of the mattersalleged in plaintiffs petition, regardless of the legal theory on which they are based, shall bedismissed by the court with prejudice.4. After completion of all terms outlined in this Stipulation, including but notlimited to the Suspensive Conditions outlined in Section 10, to accomplish dismissal, thisstipulation for settlement will be submitted by the parties jointly to the court, with the requ estthat it be approved pursuant to La. C.C .P. Articles 594 and 595. The p arties will then jointlymove the court to schedule a fairness hearing, and to approve the method of notice to theclass of this proposed settlement and the schedule of the fairness hearing. Notice shall be

given in such manner as the court directs, at the expense of plaintiffs, subject to saidexpenses being taxable as costs of this litigation.5. Plaintiffs and defendant, and their counsel, will use their best efforts to securethe court's approval of the settlement as set forth in this Stipulation.6. Upon completion of all procedural terms and suspensive conditions, thesettlement shall be consumm ated pursuant to the terms of this Stipulation on approval o f thecourt as provided above.7. On ap proval of the settlement by the co urt, following notice and a hearing, anorder and final judgment shall be entered approving the settlement, adjudging the terms of itto be adequate, proper, fair, and reasonable, and directing consumm ation of the settlement inaccordanc e with its terms and provisions.8. At the time of the fairness hearing env isioned herein, counsel for plaintiffs will

apply to the court for allowances of attorney fees and expenses relating to this litigation.Coun sel for plaintiffs agree that irrespective of the attorney fees set by the court, attorneyfees shall be no more or less than Two Million Five 1-lundred Thousand ($2,500,000.00)

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Dollars, and the expenses of litigation, to be app roved by the C ourt and taxed as costs, shallnot exceed Four Hundred Fifty Thousand ($450,000.00) Dollars. Defendant specificallyreserves the right to review and audit all costs submitted to the court for reimbursem ent

9. This Stipulation is not, and shall not be construed to be, either an adm ission bydefendant of the validity of any of the claims asserted in this action, or of liability, or of anywrongd oing, nor shall the stipulation be construed as an a dmission by p laintiffs of any Jackof m erit in their allegations.10. Suspensive Conditions:

10.1. T his settlement, as provided in this Stipulation, is not effective, and nojudgment may be entered pursuant to this Stipulation, and no notices or otherprocedures or actions by the parties contemplated in this Stipulation may be taken,until this settlement is specifically approved by the L ouisiana Attorney G eneral andthe Louisiana Joint Legislative Committee on the Budget and all fees and costs areincluded within the appropriations bill that is passed by the 2012 General LegislativeSession and signed by the Governor in a ma nner that authorizes an appropriation forall fees and costs incurred in this settlement. If the foregoing approvals are notobtained by August 1, 2013, this Stipulation shall be deemed null and void, and allactions taken or agreements made, w hether verbal or written, pursuant to the terms ofthis Stipulation shall be considered of no force or effect; and all parties to this actionand to this Stipulation shall stand in the same position without prejudice as if theStipulation had not been m ade.

10.2 T his settlement is also contingent upon and shall not be effective unlessboth of the following con ditions have been met:a, Dismissal of Hooks Lawsuit. Prior to the Court's final approval ofthe Settlement, the Hooks Lawsuit shall be dismissed, with prejudice, by the plaintiffs,at their cost. The "Hooks Law suit" shall mean the law suit entitled Tommy J Hooks ,

Jr., Paul F. Garwood, and Noreen Wogan v. John Kennedy, in his capacity asTreasure of Louisiana and Administrator of Unclaimed Property pursuant to R.S.9:152 and the Uniform Distribution of Unclaim ed Property, et al., pending in the 19thJudicial District Court, bearing docket number 4 96,44 5 in the former division "F.".

b. No Other Suits. If any other lawsuit is filed in any Louisiana statecourt or in any federal court alleging or asserting any claims similar to or related toany causes of action asserted in this suit (Albach, et al. v. Kennedy, et aL) or in theHooks Lawsuit, including but not limited to claims or causes of action con cerning theLouisiana Uniform Unclaimed Property Act of 1997, LSA-R.S. 9:151, et seq. andinterest paid or allegedly payable to ow ners of unclaimed prop erty that is currentlybeing held by the State or that has already been transferred from the State to theowners thereof, statutory interest pursuant to LSA -R.S. 9:16 3, or any constitutionalclaims (state or federal) concerning interest paid or payable to ow ners of unclaimedproperty, it shall be dismissed, with prejudice, prior to the Court's final approval ofthe Settlement, at no cost to the Defendant in this suit Albach) or to the State,including but not limited to attorneys' fees.

[The rest of this case is inlentionally blank]

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This document may be executed in multiple originals.Dated: -

FOR PLAINTIFFS:C

1RICHARD J. DODSOZiSDODSON HOOKS &DER1CK (APLC)112 FOUNDERS DRIVEBATON ROUGE, LA 70810TELEPI-IONE: (225) 76-02FA 1CSJMIJE (225) j75(/-002

EflETH HQKS, EQ-'ODSON HOOKS & FIEDERICK (APLC)11 2 FOUNDERS DRIVEI3ATON ROUGE, LA 70810TELE PHONE : (225) 756-0222FACSIMILE (225) 756-0025

FOR DEFENDANT:

~ 4~ >

CHAEL H. RUBIN, E1MC GLINCIIEY STAFFORD, PLLC14T11 FLOOR, ONE AM ERICAN PLACE301 MAIN STREET-BfON ROUGE, LOUISIANA 70825TELE PHONE : (225) 383-9000FACSIM ILE: (225) 343-3076

/ U ~ tW. STEVENAR, ESQ.POYNTER,]R & COMPANY,PLC6002 PERKINS ROAD, SUITE C-IBATON ROUGE, LA 70808TELEPHONE: (225) 769-7616

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albach v. kennedy class action suit - preliminary settlement

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