GBS: A Procedural Puzzle

Towards the end of Ed Hasbrouck’s letter, he writes:

You can both object and file a claim, but if you do either, you are bound by any eventual settlement, even if you objected to the settlement terms. So there is a risk to objecting: If your objections are overruled, and the settlement is approved, you will be subject to the very settlement to which you objected.

I’ve been wondering about this for a while. It’s hornbook law that you can’t both opt out and object. I’ve confirmed this in Moore, Wright and Miller, and the Manual for Complex Litigation, all of which consider the point so uncontroversial that they pass over it quickly. Formally, the theory is that once you’ve opted out, you’re not going to be bound by the lawsuit, and thus you have no standing to object. Fine, and that makes sense when the opt-out deadline comes first. Here, however, there was never an initial class certification with out-out opportunity; instead, the case went straight to settlement. Thus, the opt-out opportunity and the objection opportunity share the same deadline, and thus, they’re incompatible, right? You see the same reasoning in lots of class action settlements.

Except that for people like Hasbrouck, this black-letter rule makes no sense. He thinks the settlement is bad for him and for people like him. But he faces a very unattractive choice. He can either protect his individual rights, or he can put his own rights at risk if he tries to protect others’, as well. The structure of the choice encourages him to be selfish. But in the class-action context, where the passivity of most class members is one of the basic facts of the universe, we want the Ed Hasbroucks of the world to file pro se objections that put serious issues before the court.

Would it be so ridiculous to allow a conditional opt-out? You’d file an objection, together with the reservation that if the court does not grant your objection, you wish to opt out. It’s straightforward, it’s implementable, it doesn’t prejudice the settling parties, and it puts all relevant information before the court. If you want a formalistic theory to justify it, say that you’re placing the objection deadline first by a few seconds. It’s not an open-ended opt-out window; you need to declare your full set of positions all at once. All it does is preserve rights appropriately; lawsuits require some risk, but settlements are supposed to be about the security of informed choice.

I would be grateful to any readers who can elaborate on this question, point me to cases in which it has been expressly addressed, or explain to me why my suggestion is either illegal or a bad idea..

the reservation that if the court does not grant your objection, you wish to opt out

How is it decided whether your objection was granted? I’m not a lawyer, so maybe I’m thinking about this the wrong way. However, I’d worry that in practice, even if the court agrees with your objection, the final decision is unlikely to be worded exactly the same way as you had hoped. This could lead to arguments about whether it was close enough to answering your objection, which could be a hassle.

Could one opt out and then petition the court to file a friend of the court brief setting out your objections. Then if the court adopted your points, you could work directly with Google to give them control over your soul, if you still wanted to.