Infamous objectors’ counsel targeted in sanctions motion in MLB class action

April 25, 2016

(Reuters) – The New York plaintiffs’ firm Samuel & Stein took seriously a threat last week from the class action lawyers who negotiated a settlement of claims against Major League Baseball for colluding with teams to monopolize broadcast rights to games. Samuel & Stein represented an objector to the proposed settlement, which reduces the price of MLB viewing packages. But when class counsel from Langer Grogan & Diver said they would move for sanctions unless the objection was withdrawn, Samuel & Stein asked for leave to drop out of the case.

“We simply do not feel that we have sufficient confidence in the objection,” the firm said in an April 21 letter to U.S. District Judge Shira Scheindlin of Manhattan, who granted the withdrawal motion.

Nevertheless, Langer Grogan brought a Rule 11 sanctions motion against Samuel & Stein and its erstwhile client the next day, requesting a $50,000 fine against each of them for bringing a frivolous objection.

Why the extreme tactic of moving for sanctions against a firm that has already quit the case? Because Samuel & Stein isn’t the true target of Langer Grogan’s motion. That distinction belongs to Christopher Bandas, the Corpus Christi, Texas, lawyer who is one of the most prolific – and reviled – class action objectors’ counsel in the country. From California to New York, class action lawyers have persuaded federal judges that Bandas represents objectors not in order to improve settlement terms but to force plaintiffs’ lawyers to pay him to drop appeals blocking final case resolutions.

Lately, Bandas keeps his name off of official court dockets, as he did in the MLB case. Samuel & Stein explained in its letter to Judge Scheindlin that it is only local counsel to its client in the MLB litigation, Sean Hull, who came to the firm through Bandas. Class counsel in the MLB case claims that Bandas avoids entering appearances so that courts will not have jurisdiction to impose sanctions upon him. That tactic, according to Langer Grogan, dates back to 2013, when U.S. District Judge James Robart of Seattle sanctioned the Texas lawyer for willfully disobeying a court order to explain the failure to post an appellate bond.

Instead, according to Langer Grogan’s motion in the MLB case, Bandas uses surrogates like Samuel & Stein, which previously worked as local counsel for Bandas in other class actions, including a short-lived objection to the Apple e-books settlement. (The judge overseeing the e-books case described the objection as having “extraordinarily little validity.”) When Bandas contacted Samuel & Stein to file a last-minute objection in the MLB case, the firm said in its letter to Judge Scheindlin, Bandas said his firm would prepare the objection. “Perhaps unwisely,” Samuel & Stein said, “we agreed to assist him” in filing the document.

Bandas refused to drop the objection when Samuel & Stein informed him that it wanted out of the case, according to the firm’s letter to Judge Scheindlin. He supposedly told Samuel & Stein that the objection his firm had drafted was not frivolous and he was prepared to defend it.

Class counsel in the MLB case said the only way to stop Bandas and his confederates from taking advantage of the objection process is to make them pay. “Despite courts repeatedly concluding that Mr. Bandas and his clients and associates have done just that, they persist in filing baseless objections ‘in order to get paid to go away,'” the sanctions motion said. “It is clear that only the imposition of significant sanctions will prevent them from continuing to abuse the justice system in this manner.”

Objectors obviously have an important role in class actions. Once defendants and class counsel reach an agreement, objectors are the only stakeholders who scrutinize proposed settlements. When they raise legitimate issues about, say, inadequate compensations, cy pres or attorneys’ fees, the entire class benefits.

But we all know that not all objections are brought in the interests of class members. Filing baseless objections to extract payments from class counsel is an ugly business. I don’t know if that’s what Bandas and his client are up to in the MLB case; a handful of other class members also raised concerns about the proposed settlement, which provides only injunctive relief to baseball viewers. (Class counsel, who are slated to receive $16.5 million if the settlement is approved, say Judge Scheindlin took money damages out of the case when she refused to certify a damages class; they contend the price reduction in viewing packages is worth as much as $205 million to class members).

If Judge Scheindlin determines Bandas and his client were ill-intended, I hope she does demand a penalty from the objector – and even from Bandas’ former co-counsel at Samuel & Stein. Class actions are too embattled to be corrupted from within.

I called and emailed Bandas but he did not respond. His client, Hull, did not reply to my email request for comment. I left a phone message at Samuel & Stein but did not receive a response.

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