Lewis & Clark Law Review
First Page
595
Abstract
When class actions resolve, it is common for some or even all funds paid to the class to remain undistributed. All U.S. circuits, 40 states, and the Class Action Fairness Act have permitted undistributed funds to be distributed as cy pres. Recently, a few commentators have voiced constitutional objections to cy pres, based upon standing pursuant to Article III, the Rules Enabling Act, and the First Amendment. However, these analyses generally ignore the congressional mandate found within Rule 23 and the power of the courts to supervise cy pres distribution. Finally, the following recommendations are made: such awards should not be used when settlement funds can be distributed to class members; these funds should not go back to a defendant or its surrogates in order to prevent undermining the class action deterrent function; and class representatives and counsel, representing the needs of the class, should select proposed recipients. Any residual settlement money should be distributed in a way that would indirectly benefit the class (including to non-profit access to justice organizations) under the following factors: (1) what the lawsuit is about; (2) the objectives of any statute that was violated; (3) the loss suffered by the class members; and (4) the geographic breadth of the class.
Recommended Citation
Gerson H. Smoger,
The Importance of Cy Pres in Modern Class Action Jurisprudence and Myths Concerning Its Use,
24
Lewis & Clark L. Rev.
595
(2020).
Available at:
https://lawcommons.lclark.edu/lclr/vol24/iss2/12