$9.5 Million Cash Settlement Approved In Bar Review Antitrust Action

by Tara Arick on April 19, 2013 · 0 comments

in anti-trust

- From LexisNexis® Mealey’s™ Daily Legal News.

A federal judge in California on April 15 preliminary approved a $ 9.5 million settlement of a class action brought by law students against West Publishing Co. and Kaplan Inc. for conspiring to restrain trade in the market for bar review preparation courses, following his rejection of an earlier settlement (Stephen Stetson, et al. v. West Publishing Corporation, No. CV-08-00810, C.D. Calif.).

Stephen Stetson filed a class action complaint alleging that BAR/BRI, a division of West, paid Kaplan Inc. up to $ 750,000 per year to refrain from entering the full-service bar review market. Stetson alleged that West and Kaplan violated Section 1 of the Sherman Act by conspiring to restrain trade in that market and that West violated Section 2 of the Sherman Act by unlawfully acquiring and/or maintaining a monopoly.

The claims were brought on behalf of individuals who purchased bar-review courses after July 31, 2006.

Previous Settlements

The purchasers reached a nonmonetary settlement with Kaplan, whereby Kaplan agreed to provide class members with discount certificates redeemable toward the purchase of future Kaplan educational courses, excluding bar review courses. The purchasers also reached a monetary settlement with West.

In July 2011, U.S. Judge Manuel L. Real of the Central District of California denied final approval to the settlement worth $ 5.28 million, holding that the average recovery amount of $ 92 per class member did not reasonably compare to other antitrust settlements against West.

In addition, the judge concluded that the coupons represented only “nominal value” to class members and the noncash settlement would “encourage . . . further business with Kaplan rather than disgorge[e] ill-gotten gains.”

In November 2011, the Ninth Circuit U.S. Court of Appeal ruled that the Stetson plaintiffs were not bound by the 2007 settlement in Rodriguez v. West Publishing Corp. (No. 05-3222, C.D. Calif.) because Rodriguez was brought on behalf of an earlier class of purchasers.

All Cash Settlement

The parties then reached the instant cash settlement of $ 9.5 million. The settlement does not include any discount certificates.

The purchasers estimate that the per-claimant gross recovery is $ 166, as opposed to the $ 92 gross cash recovery under the earlier proposed settlement.

The purchasers are represented by Alan Harris and David Zelenski of Harris & Ruble in Los Angeles.

Judge Real set the hearing for final approval of the class settlement for Aug. 19, 2013.

The purchasers are represented by David Zelenski and Alan Harris of Harris & Ruble in Los Angeles.

West is represented by Heather Gilhooly and Edward A. Klein of Liner Grode Stein Yankelevitz Sunshine Regenstreif & Taylor in Los Angeles; James F. Rittinger and Justin E. Klein of Satterlee, Stephens, Burke & Burke in New York; and James Patrick Tallon and Wayne D. Collins of Shearman & Sterling in New York. Kaplan is represented by Bradley J. Phillips, Stuart Neil Senator and Elisabeth Jill Neubauer of Munger, Tolles & Olson in Los Angeles.

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