AcroMed- Sambolin Appeal Re Notice to Class (In re Orthopedic Bone Screw Prods. Liab. Litig.)

Class Actions — Objections to Proposed Settlements
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The AcroMed bone screw class action settlement was signed on January 8, 1997. That settlement provided about $100 million to be split among individuals claiming injury from the defendant's allegedly defective bone screws. Notice of the settlement was provided in January and February of 1997. Notice was sent by first-class mail notice to individuals who had already sued AcroMed or who were otherwise known to plaintiffs' counsel, and a short ad was published in USA Today, TV Guide, and Parade, and on page 50 of a newspaper in San Juan, Puerto Rico. The settlement appeared to require that class members file a one-page registration form by May 1, 1997 (later extended to May 15), including name, address, social security number, and a few other items, but no information concerning the nature of the class member's injuries. The deadline was about 5 months before the district court even approved the settlement, nearly a year before all appeals were exhausted and the settlement became final, and more than two years before claim forms with allegations of injury and supporting medical data were eventually required to be filed. The notice sent by first-class mail contained a registration form, but the publication notices did not.

Meanwhile, at the time the notice was being published, Alexander Sambolin was at home in the countryside near Luquillo, a small seaside village on the Northeast coast of Puerto Rico. Six months earlier he had had his defective AcroMed screws removed because one had broken, another had loosened, and he was in excruciating pain. He never saw notice of the settlement, which was not published in Luquillo, and he never saw nor was told of the fine-print notice on page 50 of the San Juan paper. After consulting local attorneys who also knew nothing of the class action, he spoke with a Miami lawyer, learned of the class action settlement, and, within days, filed his registration form in December 1997. That filing was "late," i.e. after the May 15, 1997 deadline, but before the settlement became final and well before any claim information was filed or evaluated. Indeed, Mr. Sambolin filed his claim form with supporting medical evidence before most other class members.

After he filed his claim form, Sambolin was informed by the settlement's Claims Administrator that because he had filed "late," his recovery from the settlement fund would be reduced by 20%. He then made a written request that this reduction be waived because he never received notice of the original May 15, 1997 due date before that date, and he registered as soon as he learned of it.

Thereafter, the district court ruled that May 15, 1997 was an absolute deadline, and the Claims Administrator notified Sambolin that his claim would be denied as untimely. (The Claims Administrator has since informed us that if Sambolin's claim were considered timely, it would be significantly more valuable claim than the average claim). Sambolin then filed a motion asking the district court for relief from the district court's inflexible deadline, arguing that the class action notice was inadequate and that due process required treating his registration and claim form as timely. The district court denied that motion and Sambolin appealed to the Third Circuit.

Public Citizen Involvement: Shortly after the district court denied Sambolin's request for extension/waiver of the deadline, we were brought in to handle the Third Circuit appeal. Our argument is two-fold: First, it was an abuse of discretion and a violation of due process not to treat class members who filed timely proofs of claim as eligible to share in the settlement fund, since no one was prejudiced by "untimely" registrants who filed their substantive claims on time. Second, we argue more broadly that the notice of the settlement was so paltry as to violate due process, and thus no class member can be bound to due dates contained in that notice.