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noting in approving a Title III class settlement that "[n]o court has held that internet websites made available to the public by retail entities must be accessible"
Summary of this case from Access Now, Inc. v. Southwest Airlines, Co.Opinion
No. 00-14017-CIV-MOORE
May 7, 2002
ORDER APPROVING SETTLEMENT AGREEMENT
THIS CAUSE is before the Court pursuant to the Court's January 14, 2002 Order setting a hearing, pursuant to Rule 23(e) of the Federal Rules of Civil Procedure, to review and determine the merits of any objection to the settlement, determine whether to approve the settlement as fair and reasonable, adequate and in the best interest of the certified class, grant a fee award to class counsel, determine whether to enter a final judgment approving settlement and determine such other matters as may be appropriate. The Court conducted the fairness hearing on May 2, 2002.
The Court, after having considered the motion, noting the lack of written objections to the proposed consent decree, the evidence presented at, as well as prior to the fairness hearing, argument of counsel, pertinent portions of the record, and otherwise being fully advised in the premises, hereby
ORDERS and ADJUDGES that the joint motion is GRANTED, the class, previously certified by this Court pursuant to Rule 23(b)(2) of the Federal Rules of Civil Procedure, and the proposed Revised Settlement Agreement is approved.
By Joint Motion dated April 23, 2002, the Parties Modified the Settlement Agreement (hereinafter referred to as "Settlement Agreement") to provide for increased aisle space in the Category One stores. According to the pates, this change was wade based upon comments from a representative from a disability fights organization. Also a non-substantive change was made, designating a different Claires' representative to be contacted for Notice purposes.
I. FACTUAL AND PROCEDURAL BACKGROUND
On January 11, 2000, the plaintiffs, on behalf of themselves and all other similarly situated persons, filed a class-action complaint against Claire's Stores, Inc. and Claire's Boutiques, Inc., pursuant to Fed.R.Civ.P. 23. That complaint alleged that Claire's Stores and Claire's Boutiques (hereinafter collectively referred to as "Claires") violated Title III of the American with Disabilities Act by failing to providing its customers with disabilities access throughout its stores and internet site, and sought a permanent injunction to compel compliance with the ADA. (Amended Complaint, DE 29). Claires answered the complaint and denied that it had violated the ADA. (Answer, DE 32). Throughout the litigation and settlement process, Claires has denied any violation of the ADA. (Fine Dec. ¶ 6).
Plaintiffs commenced discovery regarding class certification, regarding the commonality and typicality of the stores involved in the Claire's Stores chain. (Dietz Dec. ¶ 4). On August 21, 2000, Plaintiffs served a Motion for Class Certification. Claires agreed to submit to a conditional class certification, in part to avoid the possibility of inconsistent rulings by different courts and to maximize the corporations' resources to resolve the ADA issue. (Fine Dec. ¶ 5). On February 14, 2001, the Court filed an Order Conditionally Certifying this Class. (DE 34). On January 22, 2001, the parties moved to amend the complaint to exclude one of Claires' subsidiaries, Mr. Rags, from the instant case due to the fact that Mr. Rags is not similar to the design and product selection of the Claire's stores. (DE 29). On January 24, 2001, this Court granted Plaintiffs' agreed motion to amend the complaint. (DE 31).
In January 2001, the parties began settlement negotiations. (Dietz Dec. ¶ 6). The parties retained experts in the fields of compliance with the Americans with Disabilities Act and the operations of retail stores. (Dietz Dec. ¶ 6, Londono Dec., Weitz Dec.). Throughout this litigation, the parties have exchanged voluminous discovery regarding the plans of several of the premises involved, construction plans of displays, customer service policies, and made several trips to investigate such stores. (Dietz Dec. ¶ 7-8). Multiple stores in Florida, Georgia, Massachusetts, Illinois, California and Washington were inspected. (Dietz Dec. ¶ 8).
As set forth below, the Settlement Agreement contains a comprehensive analysis of accessibility issues at Claires' stores, as well as a clear and detailed enhancement program guaranteeing that Defendants' 2,200 plus facilities throughout the nation will be more fully accessible to the disabled under one consistent standard. In implementing this program Claires will spend upward of $19 million and will require the mobilization, dedication and education of thousands of employees. (Samela Dec. ¶ 6).
The parties engaged in substantial arms-length negotiations, and finalized their settlement agreement in this case. In November 2001, the parties submitted this agreement to the Court, and the Court set the hearing for May 2, 2002 at 2:15 p.m. Pursuant to this Court's Order dated January 14, 2002, (DE 58) the Settlement Agreement was noticed by: (1) mailing a Court approved notice to each member of Access Now, Inc.; (2) publishing notice of this Settlement Agreement in three separate publications directed toward individuals with a wide range of disabilities (mobility, hearing and sight impairments); by (3) posting notice of the Settlement Agreement on Claires' internet website; and by (4) placing a notice in each store informing customers of the settlement agreement and indicating where a copy of the Settlement Agreement could be obtained. A notice of the proposed Settlement Agreement and the fairness hearing was approved by this Court (DE 57), which required objections to the agreement to be filed with the Court no later than April 2, 2002. No Objections to this Settlement were filed.
In its order of January 14, 2002, the Court also addressed the matter of certification of the plaintiff class, and having found that the proposed class satisfied all of the requirements for certification under Federal Rule of Civil Procedure 23, certified the class. (DE 58).
II. FINDINGS OF FACT AND CONCLUSIONS OF LAW
A. THE SETTLEMENT CLASS COMPLIES WITH FEDERAL RULE OF CIVIL PROCEDURE 23(a) AND 23(b)(2) AND HAS BEEN CERTIFIED
The settlement calls for certification of a class of:
All persons who have been or will qualify as having a "disability," as that term is defined by 42 U.S.C. § 12102(2), or who are associated with a person with a disability, and who have been or will be a visitor, customer, patron or guest to a CLAIRES Store or Future Store, or otherwise have been or will be adversely affected by the design or construction of, or the policies, practices, or procedures relating to the physical accessibility, or the provision of auxiliary aides and services of a CLAIRES Store or Future Store. (Settlement Agreement, page 10-11).
The issue of certification came before the Court on the parties' joint motion to set a hearing to consider approval of a settlement reached by the parties. Class certification is appropriate in this case. A class action may be maintained when the action satisfies all of the requirements of Federal Rule of Civil Procedure 23(a) and at least one of the alternative requirements of Federal Rule of Civil Procedure 23(b). Rule 23(a) sets forth four prerequisites for class certification: (1) "numerosity," meaning that the class is so numerous that joinder of all members is impracticable; (2) "commonality," meaning that there are questions of law or fact common to the class; (3) "typicality," meaning that 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.
See Pickett v. Iowa Beef Processors, 209 F.3d 1276, 1279(11th Cir. 2000); Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999, 1005(11th Cir. 1997), reh'g en banc denied, 167 F.3d 542 (11th Cir. 1998).
See Amchem Products. Inc. v. Windsor, 521 U.S. 591, 613 (1997); Fed.R.Civ.P. 23(a).
In addition, Rule 23(b) requires that one of three further criteria be satisfied. In this case, the parties sought certification alternatively under one of the following two of these criteria:
First, the parties sought certification because the prosecution of separate actions by or against members of the class would create a risk of either (a) inconsistent or varying adjudications which would establish incompatible standards of conduct for the opposing party, or (b) adjudications which would as a practical matter be dispositive of the interests of other class members not party to the adjudications or substantially impair or impede their ability to protect their interests. See Fed.R.Civ.P. 23(b)(1). Alternatively, the parties here sought certification because the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole. See Fed.R.Civ.P. 23(b)(2).
See Amchem Products, Inc., 521 U.S. at 614; Fed.R.Civ.P. 23(b)(2).
The parties have previously demonstrated to the Court that the proposed class satisfies all of these criteria. Accordingly, this Court certified the class. (DE 58).
1. Notice Was Appropriate Under Rule 23
This Court properly certified the Plaintiff class under Rule 23(b)(2). Notice (and exclusion opportunity) is not required in Rule 23(b)(2) actions. Eisen v. Carlisle, 417 U.S. 156, 177 n. 14 (1974); Fontana v. Elrod, 826 F.2d 729, 732 (7th Cir. 1987)(same); AHM, 2000 U.S. Dist. LEXIS 14788 at * 15; Sikes v. American Tel. Tel. Co., 841 F. Supp. 1572, 1579 (S.D. Ga. 1993); Larkin Gen. Hosp. Ltd. v. American Tel. Tel. Co., 93 F.R.D. 497, 501-02 (E.D. Pa. 1982);Rosen v. Price Communications Corp., No. 95 Civ. 5089 (CSH), 1998 U.S. Dist. LEXIS 9198 at * 3 (S.D.N.Y. June 2, 1998).
Here, even though no notice was required and individual notice was impossible, the parties suggested, and the Court approved, several forms of notice. (DE 57, 58). The Settlement Agreement was noticed by: (1) mailing a Court approved notice to each member of Access Now, Inc.; (2) publishing notice of this Settlement Agreement in three separate publications directed toward individuals with a wide range of disabilities (mobility, hearing and sight impairments); by (3) posting notice of the Settlement Agreement on Claires' internet website; and by (4) placing a notice in each store informing customers of the settlement agreement and indicating where a copy of the Settlement Agreement could be obtained.
Indeed, the Notice provided equal to or superior to that in similar actions. See AHM, 2001 U.S. Dist. LEXIS 12876 (requiring no notice to a 23(b)(2) Title III ADA class); Access Now, Inc. v. Cunard Line Limited, Co., 2001 WL 1622015(S.D. Fla. 2001) (Court finding that dissemination of a detailed notice and mailing of the complete settlement agreement to each member of Plaintiff organization as well as published notice in three national magazines and a website targeted at the disability community sufficiently met the requirements of Federal Rule of Civil Procedure 23(e) for notice in a Rule 23(b)(1) or (2) class action). Clearly, the parties' efforts to notify all class members of the Settlement Agreement in this case, especially where no notice was procedurally required, meet or exceed the requirements of Federal Rule of Civil Procedure 23(e).
B. THE PROPOSED CONSENT DECREE IS APPROVED
1. Standard for Approving Class Action Settlements
There is an overriding public interest in favor of settlement, particularly in class actions that have the well-deserved reputation as being most complex. Cotton v. Hilton, 559 F.2d 1326, 1331 (5th Cir. 1977). In analyzing a settlement, "the clear policy in favor of encouraging settlements must. . . be taken into account, particularly in an area where voluntary compliance by the parties over an extended period will contribute significantly toward ultimate achievement of statutory goals." Patterson v. Newspaper Mail Deliverers' Union, 514 F.2d 767, 771 (2d Cir. 1975) (citations omitted). A class action settlement accordingly should be approved so long as it is "fair, adequate and reasonable and is not the product of collusion between the parties."Bennett v. Behring Corp., 737 F.2d 982, 986(11th Cir. 1984); Cotton, 559 F.2d at 1330; Behrens v. Wometco Enters, Inc., 118 F.R.D. 534, 537(S.D. Fla. 1988).
In determining whether the settlement is fair, adequate and reasonable, the Court must consider all relevant factors, including (1) the likelihood of success at trial; (2) the range of possible recovery; (3) the point on or below the range of possible recovery at which a settlement is fair, adequate and reasonable; (4)the complexity, expense and duration of the litigation; (5) the substance and amount of opposition to the settlement; and (6) the state of proceedings at which the settlement was achieved. Bennett, 737 F.2d at 986; Cotton, 559 F.2d at 1330-31.
In evaluating these considerations, the Court must not try the case on the merits. Cotton v. Hinton, 559 F.2d 1326, 1330 (5th Cir. 1977). Rather, the Court must rely upon the judgment of experienced counsel and, absent fraud, "should be hesitant to substitute its own judgment for that of counsel." Id. (internal citation omitted). In evaluating a settlement's fairness, "it should [not] be forgotten that compromise is the essence of a settlement. The trial court should not make a proponent of a proposed settlement `justify each term of settlement against a hypothetical or speculative measure of what concessions might [be] gained." Cotton, 559 F.2d at 1330 (quotation omitted). "Above all, the court must be mindful that `inherent in compromise is a yielding of absolutes and an abandoning of highest hopes." Ruiz v. McKaskle, 724 F.2d 1149, 1152 (5th Cir. 1984) (quoting Cotton, 559 F.2d at 1330).
Even when the Court becomes aware of one or more objecting parties, the Court is not "required to open to question and debate every provision of the proposed compromise. The growing rule is that the trial courts may limit its proceeding to whatever is necessary to aid it in reaching an informed, just and reasoned decision." Cotton, 559 F.2d 1331.
2. The Settlement Agreement Is Fair, Adequate, and Reasonable and Not the Product of Collusion
The primary purpose of the ADA is "to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities," and "to provide clear, strong, consistent, enforceable standards addressing discrimination against individuals with disabilities." 42 U.S.C. § 12101(b)(2001). The Settlement Agreement fulfills that purpose by creating a clear and comprehensive program guaranteeing that Defendants' numerous retail stores throughout the nation will be more fully accessible to the disabled. The settlement provides relief that meets, and in several instances exceeds of what an individual would otherwise be able to obtain at trial.
3. The Consent Decree Satisfies All Bennett Factors
In Bennett v. Behring Corp., 737 F.2d 982(11th Cir. 1984), the Eleventh Circuit set forth the factors that control approval of class action settlements. A review of these factors confirms that the Consent Decree is fair, adequate, and reasonable, and is not the product of collusion, and accordingly should be approved.
a. Likelihood of Success at Trial
The first factor this Court must consider is Plaintiffs' likelihood of success at trial. Bennett, 737 F.2d at 986. A trial on the merits would require an examination of over 2,200 retail stores throughout the United States over questions including: (1) whether each store denies full and equal enjoyment and access to individuals with disabilities; (2) whether each store has made reasonable modifications to its policies, practices and procedures when necessary to afford accommodations to individuals with disabilities; (3) whether each store has failed to remove bafflers to access; (4) whether such baffler removal is readily achievable; and (5) when such baffler removal is not readily achievable, whether alternative means of providing access have been provided.
Additionally, the Court would be required to address Defendants' numerous statutory defenses, including whether proposed modifications are technically feasible, virtually impossible, structurally impractical, would pose significant risk to health or safety, or simply, not required. Various disputes would also exist as to what measures, if any, are legally required to bring the stores into compliance under the developing law of the ADA and whether alternative measures provide equivalent access. For example, the issue of whether the rearrangement or removal of display fixtures to increase accessibility would not be readily achievable to the extent that it results in significant loss of selling or serving space has not yet been considered by the courts in the context of small mall-type retail stores. In fact only one district court has dealt with the aisle width issue and that was in the context of a large department store. Regardless of how the Court might ultimately interpret this provision of the regulations, it would then have to undergo a factual analysis of the application of its interpretation to each of over 2,200 stores across the country. Another issue is in regard to the claim that Claires does not provide an accessible Internet website. No court has held that internet websites made available to the public by retail entities must be accessible. The likelihood of prevailing on this issue at trial is clearly uncertain.
See 28 C.F.R. § 36.304(f): "The rearrangement of temporary or movable structures, such as furniture, equipment, and display racks is not readily achievable to the extent that it results in a significant loss of selling or serving space."
See Leiber v. Macy's West, 80 F. Supp.2d 1065 (N.D.Cal 1999).
Clearly, given Defendants' numerous significant defenses, the complexities of the case, and the developing nature of the law interpreting the ADA, the outcome of a trial on the merits is extremely uncertain.
b. Range of Possible Recovery
The next factor this Court must consider is the range of relief Plaintiffs might obtain at trial. See Bennett, 737 F.2d at 986. Plaintiffs seek exclusively injunctive relief under Fed.R.Civ. 23(a), 23(b)(2) and the ADA. (DE 29). Plaintiffs' range of possible recovery spans from a finding of non-liability through varying levels of injunctive relief ranging from specific relief at individual retail stores to relief at a corporate level such as providing an accessible Internet website.
c. The Point on or Below the Range of Possible Recovery at Which a Settlement Is Fair
The next Bennett factor is to determine the point within the range of possible recovery at which a settlement is fair. Bennett, 737 F.2d at 986. Under this settlement, Defendants expect to spend approximately $19 million inspecting and modifying its stores and Internet website to guarantee they are accessible to disabled patrons as well as training thousands of employees. (Samela Dec. ¶ 6). Accessibility is provided for throughout the stores, including accessible aisle widths, visual accessibility standards where it is not readily achievable to provide all aisles with accessible width, accessible cashwrap counters, and signage indicating the availability of assistance for patrons with disabilities. (Settlement Agreement, Exhibit A). Claires' consumer Internet website will likewise be made accessible. (Settlement Agreement, Exhibit A § 4E). Some of the ways that accessibility is being provided, including the website, are not addressed in the Title III regulations or Americans with Disabilities Act Access Guidelines ("ADAAG"), and therefore are not required under the ADA. Consequently, for these issues, the relief the Settlement Agreement provides exceeds the possible recovery in a trial.
This Court notes that 28 C.F.R. § 36.305 (a) provides that when a public accommodation can demonstrate that baffler removal is not readily achievable, it shall accommodate through alternative methods, if those methods are readily achievable. The parties' Visual Accessibility requirements provide a satisfactory alternative to providing increased aisle width in the small and medium stores.
See generally: 28 C.F.R. Part 36.
Title III of the ADA's provisions are implemented by guidelines, known as ADAAG, which are promulgated by the Department of Justice. 42 U.S.C. § 12186(a)(2001); 28 C.F.R. Part 36 Appendix A (2001).
Additionally, Defendants have agreed to provide alternative service to disabled patrons who need additional assistance, and will implement special training of employees including agreed upon changes to company policies to ensure full and equal accessibility to disabled patrons. (Settlement Agreement Exhibit A § 4B, C D; Samela Dec., Richardson Dec., Weber Dec.). Part of the special training will include providing Claires' regional and district managers with additional training as to the requirements of the Settlement Agreement regarding aisle widths in sales areas in order to ensure, from a corporate control perspective, the best compliance with that aspect of the Settlement Agreement. Defendants also have agreed to provide class counsel with inspection reports of all stores and to allow Plaintiffs to inspect stores for compliance with the Settlement Agreement, all at Defendants' expense. (Settlement Agreement D 2.3). Finally, Defendants have agreed to pay Plaintiffs' reasonable attorneys' fees and costs to ensure that the settlement is fully implemented. (Settlement Agreement D 2.4 5.2).
Plaintiffs clearly have obtained most of the relief they sought in the complaint, and in some respects, more than they could possibly obtain even if they were entirely successful at trial. The Settlement Agreement thus provides relief at or above the highest range of possible recovery. This factor weighs heavily in favor of the settlement's approval.Bennett, 737 F.2d at 986.
d. Complexity, Expense, and Duration of Litigation
The next factor this Court must consider is the complexity and expense of litigating this matter. See Bennett, 737 F.2d at 986. The parties have spent a great deal of time and expense analyzing the legal and factual issues this case presents. As discussed above, absent settlement, this matter clearly will require a protracted and expensive trial and appeal, under circumstances where the ultimate results are highly uncertain. The parties, therefore, have good cause to settle this matter, another factor favoring this Court's approval of the settlement agreement.
e. Substance and Amount of Opposition to Settlement
The next factor this Court must consider is the amount of opposition to the settlement. Bennett, 737 F.2d at 986. Despite the comprehensive notice procedures adopted by the parties, no class member has objected to the settlement. The Court notes that in several recent Title III of the ADA class actions in this district which were similarly noticed, the Department of Justice and several state attorneys generals filed objections. This has not been the case in this matter. The fact that no objections have been filed strongly favors approval of the settlement. Id.
See e.g., Access Now, Inc. v. Cunard Line Limited, Co., 2001 WL 1622015 (S.D. Fla. 2001); Access Now, Inc. v. The May Department Stores Co., Case No.: 00-0148-CIV-MORENO.
f. The Stage of Proceedings at Which the Settlement Was Achieved
The Court also must consider the stage of the litigation in which the parties reached settlement. Bennett, 737 F.2d at 986. The complaint in this matter was filed on January 14, 2000, over two years ago. (DE 1). Since then, the parties and their experts have conducted extensive discovery and settlement negotiations, including numerous surveys, site visits and inspections of individual stores in multiple states. (Dietz Dec; Londono Decl). Because the parties have expended much effort in analyzing the issues, this Court should find that the parties are at a proper juncture with sufficient information to settle this action. Id.
g. The Judgment of Experienced Counsel for the Parties
The Court is entitled to rely upon the judgment of experienced counsel. Cotton, 559 F.2d at 1330. Plaintiffs are represented by counsel experienced in ADA litigation, including experience with lawsuits concerning access for persons with disabilities to retail stores (Dietz Dec.). Likewise counsel for Claires have substantial experience in ADA and class litigation. (Fine Dec.). The parties' experts also are experienced and well thought of in matters regarding the issues in this lawsuit. (Londono Dec.; Weitz Dec.; Richardson Dec.). The judgment of these experienced counsel and experts that the Settlement Agreement is a fair, reasonable, and adequate resolution of this matter is another factor that favors approval of the Settlement Agreement. Cotton, 559 F.2d at 1330.
h. The Settlement Is Not the Product of Collusion
Class counsel and counsel for Defendants have acted at arms-length in negotiating the settlement, and have vigorously represented their respective clients' interests. (Dietz Dec.; Fine Dec.). Moreover, the amount of money which will be spent making modifications, and the extraordinary relief Plaintiffs have obtained, is itself evidence that the parties have negotiated in good faith at arms-length. The Settlement Agreement is not the result of fraud or collusion among the parties.
The Court finds that the Settlement Agreement is fair, adequate, reasonable, and not the subject of collusion. Accordingly, it should be approved.
III. CONCLUSION
The Court finds that the Plaintiff class meets the requirements for certification pursuant to Rule 23(a) and Rule 23(b)(2) of the Federal Rules of Civil Procedure. The Court further finds that the proposed settlement is fundamentally, fair, adequate, and reasonable, and not the product of collusion between the parties, and satisfies all of the factors set forth by the Eleventh Circuit in Bennett v. Behring Corp., 737 F.2d 982(11th Cir. 1984).
Accordingly, for all the foregoing reasons, the Court APPROVES the Settlement Agreement.
The Court retains jurisdiction for enforcement purposes as well as for fees and costs.