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«IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA : IN RE: NATIONAL FOOTBALL : No. 2:12-md-02323-AB LEAGUE PLAYERS’ ...»

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

:

IN RE: NATIONAL FOOTBALL : No. 2:12-md-02323-AB

LEAGUE PLAYERS’ CONCUSSION :

INJURY LITIGATION : MDL No. 2323

:

: Hon. Anita B. Brody

Kevin Turner and Shawn Wooden, :

on behalf of themselves and :

others similarly situated, :

Plaintiffs, : Civ. Action No.

14-00029-AB :

v. :

:

National Football League and :

NFL Properties, LLC, :

successor-in-interest to :

NFL Properties, Inc., :

Defendants. :

:

:

THIS DOCUMENT RELATES TO: :

ALL ACTIONS :

:

July 7, 2014 Anita B. Brody, J.

MEMORANDUM

Plaintiffs Kevin Turner and Shawn Wooden, through their proposed Co-Lead Class Counsel, Class Counsel, and Subclass Counsel, and Defendants National Football League and NFL Properties, LLC (collectively, the “NFL Parties”)1 have negotiated and agreed to a Class Action Settlement (“Settlement”) that will resolve all claims against the NFL Parties in this multidistrict litigation.2 On June 25, 2014, Plaintiffs filed an unopposed motion for an order: (1) 1 Plaintiffs have also sued Riddell, Inc., Riddell Sports Group Inc., All American Sports Corporation, Easton-Bell Sports, Inc., EB Sports Corp., Easton-Bell Sports, LLC, and RBG Holdings Corp. (collectively, the “Riddell Defendants”). The Riddell Defendants are not a party to the proposed Settlement.

2 Capitalized terms used in this Memorandum have the same meaning as those in the June 25, 2014 Class Action 1 granting preliminary approval of the proposed Class Action Settlement Agreement; (2) conditionally certifying a Settlement Class and Subclasses; (3) appointing Co-Lead Class Counsel, Class Counsel, and Subclass Counsel; (4) approving the dissemination of class notice;

(5) scheduling a Fairness Hearing; and (6) staying matters as to the Released Parties and enjoining proposed Settlement Class Members from pursuing Related Lawsuits. For the following reasons, I will grant the motion.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

In July 2011, the first retired players filed lawsuits against the NFL Parties alleging, inter alia, that the NFL Parties breached their duties to the players by failing to take reasonable actions to protect players from the chronic risks created by concussive and sub-concussive head injuries and that the NFL Parties concealed those risks from the players. Since that time, more than 5,000 former players have filed substantially similar lawsuits. These lawsuits have been consolidated before me as a multidistrict litigation (“MDL”), pursuant to 28 U.S.C. § 1407. See MDL Panel Transfer Order, Jan. 31, 2012, ECF No. 1.

On July 8, 2013, I directed the parties to mediation before retired U.S. District Court Judge Layn Phillips. Order, July 8, 2013, ECF No. 5128. On August 29, 2013, Judge Phillips informed me that Plaintiffs and the NFL Parties had signed a term sheet incorporating the principal terms of a settlement. Order, Aug. 29, 2013, ECF No. 5235. On December 16, 2013, pursuant to Federal Rule of Civil Procedure 53, I appointed Perry Golkin as Special Master to assist me in analyzing the financial aspects of any settlement. Order Appointing Special Master, Dec. 16, 2013, ECF No. 5607.

On January 6, 2014, Plaintiffs moved for entry of an order preliminarily approving their proposed settlement and conditionally granting class certification. Pl.’s Mot., Jan. 6, 2014, ECF Settlement Agreement. Pl.’s Mot. Ex. B, June 25, 2014, ECF No. 6037.

–  –  –

Turner v. Nat’l Football League, No. 14-00029 (E.D. Pa. Jan. 6, 2014), ECF No. 1. On January 14, 2014, I denied the motion without prejudice, expressing concern as to the adequacy of the proposed $675 million Monetary Award Fund in light of the 65-year lifespan of the Monetary Award Fund, the settlement class size of more than 20,000 members, and the potential magnitude of the awards. Order, Jan. 14, 2014, ECF No. 5658.

After six months of additional negotiation, guided by my January 14, 2014 opinion and Special Master Golkin, the parties reached a revised Settlement aimed at providing assurance that all Retired NFL Football Players who ultimately receive a Qualifying Diagnosis or their related claimants will be paid. Special Master Golkin has been a critical source of advice and financial expertise for the parties and me.3 As a result of the negotiations, the Monetary Award Fund is no longer fixed at $675 million, and the NFL Parties must pay all valid claims for the next 65 years. The revised Settlement retains the same significant Monetary Award levels and the NFL Parties’ obligation to pay for the costs and expenses of claims administration. It also includes new measures designed to prevent fraudulent claims.

II. THE PROPOSED CLASS ACTION SETTLEMENT





–  –  –

The Settlement provides for a nationwide Settlement Class consisting of three types of claimants: (1) Retired NFL Football Players, generally defined as all living NFL football players who, prior to the date of the Preliminary Approval and Class Certification Order,4 retired, formally or informally, from playing professional football with the NFL or any Member Club, 3 I am grateful to Special Master Golkin for his time and effort.

4 “Preliminary Approval and Class Certification Order” is defined in the June 25, 2014 Class Action Settlement Agreement as the Court’s order preliminarily approving the Class Action Settlement and conditionally certifying the Settlement Class and Subclasses. See Pl.’s Mot. Ex. B, June 25, 2014, ECF No. 6037. For the avoidance of any ambiguity, the order accompanying this Memorandum is the “Preliminary Approval and Class Certification Order.”

–  –  –

and NFL Europa League players; (2) authorized representatives, ordered by a court or other official of competent jurisdiction, of deceased or legally incapacitated or incompetent Retired NFL Football Players (“Representative Claimants”); and (3) close family members of Retired NFL Football Players or any other persons who properly assert, under applicable state law, the right to sue by virtue of their relationship with a Retired NFL Football Player (“Derivative Claimants”). Based on the records of the NFL Parties, there are more than 20,000 Settlement Class Members. Pl.’s Mem. Law 33, June 25, 2014, ECF No. 6073.

The Settlement Class consists of two Subclasses: Subclass 1 is defined as Retired NFL Football Players who were not diagnosed with a Qualifying Diagnosis prior to the date of the Preliminary Approval and Class Certification Order, and their Representative Claimants and Derivative Claimants; and Subclass 2 is defined as Retired NFL Football Players who were diagnosed with a Qualifying Diagnosis prior to the date of the Preliminary Approval and Class Certification Order and their Representative Claimants and Derivative Claimants, and the Representative Claimants of deceased Retired NFL Football Players who were diagnosed with a Qualifying Diagnosis prior to death or who died prior to the date of the Preliminary Approval and Class Certification Order and who received a post-mortem diagnosis of chronic traumatic encephalopathy (“CTE”). A Qualifying Diagnosis is defined as Level 1.5 Neurocognitive Impairment (early Dementia), Level 2 Neurocognitive Impairment (moderate Dementia), Alzheimer’s Disease, Parkinson’s Disease, Amyotropic Lateral Sclerosis (“ALS”), and/or Death with CTE.

–  –  –

The current Settlement provides that the NFL Parties will make payments over a period of years to create three sources of benefits for Settlement Class Members.

First, the Settlement provides for a $75 million Baseline Assessment Program (“BAP”) that will offer all eligible Retired NFL Football Players baseline neuropsychological and neurological evaluations to determine the existence and extent of any cognitive deficits. In the event that retired players are found to suffer from Level 1 Neurocognitive Impairment (moderate cognitive impairment), they may receive certain BAP Supplemental Benefits in the form of specified medical treatment and/or evaluation, including counseling and pharmaceutical coverage. In addition to detecting any cognitive impairment, the results of BAP examinations may be used as a comparison against any future tests to determine whether a Retired NFL Football Player’s cognitive abilities have deteriorated. Further, subject to the reasonable informed consent of Retired NFL Football Players, in compliance with applicable privacy and health laws, and any other customary authorization, medical data generated will be made available for use by those conducting medical research on cognitive impairment, safety, and injury prevention.

Second, the Settlement provides for a 65-year Monetary Award Fund that will award cash to Retired NFL Football Players who already have a Qualifying Diagnosis or receive one in the future. Representative Claimants and Derivative Claimants related to such players will also be eligible for cash awards. The Qualifying Diagnoses and their maximum Monetary Award levels are as follows: Level 1.5 Neurocognitive Impairment ($1.5 million); Level 2 Neurocognitive Impairment ($3 million); Alzheimer’s Disease ($3.5 million); Parkinson’s Disease ($3.5

–  –  –

on a retired player’s age at the time of diagnosis, the number of NFL seasons played, and other applicable offsets outlined in the Settlement. If, after receiving an initial Monetary Award, a Retired NFL Football Player becomes eligible for a larger Award because of a different Qualifying Diagnosis, the retired player will be provided with a Supplemental Monetary Award to ensure that the retired player receives the maximum award to which he is entitled. The Settlement does not require Settlement Class Members to prove that the Retired NFL Football Player’s cognitive injuries were caused by NFL-related concussions or sub-concussive head injuries. Both Settlement Class Members and the NFL Parties have the right to appeal a Class Member’s entitlement to a Monetary Award.

Third, the Settlement establishes a $10 million Education Fund to fund education programs promoting safety and injury prevention with regard to football players, including safety-related initiatives in youth football. This Fund will also educate Retired NFL Football Players regarding the NFL’s medical and disability programs.

A Special Master will oversee the functions of a Claims Administrator who will process claims for Monetary Awards and Derivative Claimant Awards. The Monetary Award Fund, which is funded by the NFL Parties, will pay for the compensation and reasonable costs and expenses of the Special Master and Claims Administrator.

In addition, the NFL Parties will pay up to $4 million in notice expenses. The NFL Parties will also pay attorneys’ fees and costs and have agreed not to object to a petition for fees and costs that does not exceed $112.5 million. This amount to be paid by the NFL Parties is in addition to the amounts that the NFL Parties will pay to satisfy all Monetary Awards, finance the 5 Beginning one year after the Effective Date of the Settlement, all Monetary Awards will be adjusted upwards by as much as 2.5% per year for inflation.

–  –  –

expenses.

Furthermore, Retired NFL Football Players are not precluded from participating in the Settlement as a result of having received benefits pursuant to benefit programs provided under a Collective Bargaining Agreement (“CBA”) with the NFL (e.g., the 88 Plan) or because they signed releases and covenants not to sue the NFL pursuant to the Neuro-Cognitive Disability Benefit under Article 65 of the 2011 CBA. In addition to Settlement benefits, Retired NFL Football Players are entitled to seek all applicable bargained-for benefits in the Collective Bargaining Agreements with the NFL.

In exchange for the benefits provided in the Settlement, Settlement Class Members and their related parties agree to release all claims and dismiss with prejudice all actions against, and covenant not to sue, the NFL Parties and other Released Parties and all Related Lawsuits in this Court and other courts. In contrast to the previous version of the Settlement, Settlement Class Members who receive Monetary Awards are not required to dismiss pending and/or forebear from bringing litigation relating to cognitive injuries against the National Collegiate Athletic Association (“NCAA”) and any other collegiate, amateur, or youth football organizations.

III. DISCUSSION A. Preliminary Approval of the Proposed Settlement Under Federal Rule of Civil Procedure 23(e), the settlement of a class action requires court approval. Fed. R. Civ. P. 23(e)(2). Review of a proposed class action settlement typically proceeds in two stages. At the first stage, the parties submit the proposed settlement to the court, which must make a preliminary fairness evaluation. If the proposed settlement is preliminarily acceptable, the court then directs that notice be provided to all class members who would be

–  –  –

to, and opt out of the settlement. See Fed. R. Civ. P. 23(c)(3), (e)(1), (e)(5). At the second stage, after class members are notified of the settlement, the court holds a formal fairness hearing where class members may object to the settlement. See Fed. R. Civ. P. 23(e)(1)(B). If the court concludes that the settlement is “fair, reasonable and adequate,” the settlement is given final approval. Fed. R. Civ. P. 23(e)(2). At this time, Plaintiffs request that I grant preliminary approval.

–  –  –

In deciding whether to grant preliminary approval, a court determines whether:



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