Eubank v. Pella Corporation

Dist. Ct. erred in approving proposed settlement of class action that sought compensation for defendant’s manufacture of casement windows that allowed water to damage windows’ wooden frame, where terms of settlement called for class members to receive cash payments of up to either $750 per structure or $6,000 per structure if class member pursued arbitration of said claim. Lead class counsel, who was son-in-law to one named class representative, operated under conflict of interest and was additionally saddled with financial and ethical issues at time settlement proposal was generated. Record also suggested that said counsel “sold out” class members by agreeing to settlement that actually provided class members with little more than $1 million in damages relief, while providing class counsel with $11 million in fees. Moreover, Ct. of Appeals directed that named class representative, who was father-in-law to lead class counsel, as well as lead class counsel be removed, and that four named class representatives, who were removed by lead class counsel after they had objected to proposed settlement, be reinstated.