A proposed settlement that could net consumers $5 million worth of refunds and coupons from the nation's largest poultry producer moved one step closer to fruition Friday when a federal judge -- albeit with reservations -- signed off on the preliminary agreement.
Judge Richard D. Bennett repeatedly expressed concerns about the $3 million plaintiffs attorneys' fees and court costs that could be paid by Tyson Foods under the terms of the settlement. Bennett said he would be hard-pressed to sign off on what he called such a disproportionate scale, with the plaintiffs' counsel set to get about 37.5 percent of the overall total, while thousands of consumers net refunds capped at $50.
Several consumer lawsuits were filed across the country in 2008, and later consolidated in Baltimore, accusing Tyson of lying about the drugs that go into its birds, with the company marketing its poultry as raised without antibiotics. Tyson denies any wrongdoing under the deal, outlined in a public hearing this week for the first time.
While both sides agree on the parameters of the settlement, a point of contention now lies between the judge and counsel for the plaintiffs, who defended their multimillion-dollar request in court. Daniel C. Girard, one of five lawyers listed as representing the plaintiffs in this case, argued that the attorneys did more work per hour than what they settled for with the defendants, and that it will be documented through time slips and other record-keeping methods.
"He has the right to pay close attention to the plaintiffs' fees," Girard said of Bennett. "We fully expected that. And it's appropriate."
Bennett said he strongly doubts the court will approve the $3 million price tag when a final decision is rendered May 7. Bennett said that he had no problem with the rest of the settlement.
"When the public looks at these class action settlements, there is a general perception that a lot of money goes to lawyers and not enough goes to consumers," Bennett said.
Friday's hearing brought to light six months' worth of negotiations. Individuals who bought Tyson chicken products labeled as having been raised without antibiotics from mid-June 2007 through April 2009 are entitled to refunds. That includes anyone who bought fresh, frozen or deli chicken along with Cornish hens or tenders during that time.
The settlement is broken into tiers, with the vast majority of shoppers expected to be eligible for a $10 cash refund (if they declare under penalty of perjury that they've spent more than that and can give specific details), or a $5 coupon if they claim to have bought at least one eligible Tyson product during that time.
Girard said after the hearing that he could "understand how that looks, a $5 coupon for customers and $3 million for lawyers. But no matter what we do, in these type of cases, the amount for a client will still be small."
Lawyers for the plaintiffs agreed to have their record-keeping submitted to Bennett by mid-April. The judge said he will personally review the documents.
Bennett said that even if the lawyers can prove $3 million worth of work, that does not mean he will agree to award that amount when he renders his final decision May 7.
"There is a proportionality question here that I'm going to work to address," Bennett said.