The Center for Class Action Fairness, which got into the picture in that Apple options backdating suit involving a lawsuit brought by the City of New York's pension fund after I wrote a piece here about how outrageous the settlement was, has gotten the settlement modified so that class members get an additional $2.5 million that had been slated for university-based "corporate governance" programs. Under the newly modified proposed settlement, Harvard, Columbia, and the University of Delaware no longer will get any money.
A press release from the Center for Class Action Fairness's Ted Frank says:
"It is ironic that the recipients of the money were corporate governance programs," CCAF founder and attorney Theodore H. Frank said. "The first duty of a class action attorney is to her clients, but these schools were willing to accept money that would have been improperly diverted from shareholders in breach of that fiduciary duty. While the settlement has been improved, we have asked the court to reject it because it is still deficient. The entire $16.5 million settlement fund belongs to shareholders, and there is no reason any of it should go to third parties. If class counsel wishes money to go to academic corporate governance programs, they should donate their own money rather than their clients'."
"In short, CCAF's objection got the class $2.5 million it was entitled to, but there is still work to be done in making sure that the class clients—not their lawyers or their lawyers' friends—are the beneficiaries. The law should not, and does not, countenance such abuses of the class action system, but they are far too common." Mr. Frank said.