Judge Arthur Spatt
A 2011 agreement settled class action litigation against Washington Mutual Inc. (WMI) for $13 million. In addition to requiring that proofs of claim be filed within 15 days of a "Final Fairness Hearing" Article 6 of the settlement pact provided that class members not submitting a timely, valid proof of claim were not entitled to proceeds from the "Net Settlement Fund." After a "Final Fairness Hearing" district court approved settlement and application for attorney fees. Discussing the four factors articulated in Pioneer Inv. Servs. v. Brunswick Assoc., the court held that class counsel should address why 2,652 claims filed after the Aug. 31, 2011, deadline should be allowed. Absent information about the average payout for class members the court could not determine the extent to which WMI, which retains a reversionary interest in undistributed funds, would be prejudiced by the inclusion of the late-filed claims. The court also found no reason to penalize settlement class members who claimed an amount less than that indicated in discovery. Settlement class members were not required to indicate the amount of their alleged claim on the face of their proof of claim form and, presumably, were unaware of the default recovery amount.