Virginia Lawyers Weekly VA Lawyers Weekly
Where plaintiffs reached a settlement over claims that long-term care, or LTC, insurers failed to disclose material information to policyholders, a husband and wife then objected to that settlement and the defendants agreed to increased compensation to policyholders in exchange for the couple dropping their objections and receiving incentive payments and attorneys’ fees, the settlement with the objectors was found to be fair and reasonable.
Background
Plaintiffs filed a putative class action complaint against Genworth Life Insurance Company and Genworth Life Insurance Company of New York, alleging that defendants failed to disclose material information to LTC policyholders, to their detriment. The parties reached a settlement which the court preliminarily approved. Now before the court is a joint motion to approve the settlement with objectors Lonny and Carrol Lang.
The Lang settlement provides that the cash damages amount for the non-forfeiture option will increase from $1,150 to $1,250. Second, even though they are overruled, the Langs agree that all of their objections are withdrawn and will be denied as moot. Third, the Langs agree not to further object to the settlement, file any appeals or otherwise interfere with the settlement’s finality. Lastly, Genworth agrees to pay the Langs an incentive payment of $7,500 each and attorney’s fees not to exceed $237,500, all paid separately from the payments to class members.
Fair and reasonable
The Fourth Circuit has set a multifactor standard to assess whether a class action settlement is “fair, reasonable, and adequate.” In making that determination, a court considers: (1) the posture of the case at the time settlement was proposed; (2) the extent of discovery that had been conducted; (3) the circumstances surrounding the negotiations and (4) the experience of counsel in the area of class action litigation. All four factors weigh in favor of settlement approval. Therefore the court finds that the Langs’ settlement agreement is fair and reasonable.
Adequate
In assessing the adequacy of the proposed settlement, a court considers: (1) the relative strength of the plaintiffs’ case on the merits; (2) the existence of any difficulties of proof or strong defenses the plaintiffs are likely to encounter if the case goes to trial; (3) the anticipated duration and expense of additional litigation; (4) the solvency of the defendant and the likelihood of recovery on a litigated judgment and (5) the degree of opposition to the settlement. Because the five adequacy factors all weigh in favor of settlement approval, the court finds that the Langs’ settlement agreement is adequate.
Joint motion to approve granted.
Haney v. Genworth Life Insurance Co., Case No. 3:22-cv-55, Feb. 8, 2023. EDVA at Richmond (Payne). VLW 023-3-052. 19 pp.
