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Benecol Class Counsel Seek Third of $2 Million False Ad Deal

Jan. 13, 2022, 8:19 PM

Class counsel in a Benecol false-ad suit seek one-third of a $2 million deal, telling a federal court in California that the “exceptional relief” achieved in the lengthy litigation warrants an upward adjustment from the Ninth Circuit’s benchmark award of 25% of the settlement fund.

JoAnn Martinelli sued Johnson & Johnson Inc. and McNeil Nutritionals LLC in 2015, alleging Benecol labels touting the spreads as free of trans fats were false because the products contained trans fat from partially hydrogenated oils. The deceptive labels led her to buy the butter substitute and pay a premium, she said.

In 2019, Judge Morrison C. England Jr. of the U.S. District Court for the Eastern District of California certified a California class and a multistate class.

The court preliminarily approved the deal last September and certified a settlement class of people who purchased Benecol Spreads in the U.S. from Jan. 1, 2008, through Dec. 31, 2011.

Consumers can get a full refund for all Benecol purchases that they can substantiate. Without proof of purchase, consumers are eligible to claim $5 per tub, up to a maximum of $20. The average price of Benecol was $4.80, plaintiffs said. The payments could go down depending on claim volume.

The relief provided by the settlement—potential full refunds for purchasers of Benecol Spreads—exceeds the “price premium” damages that the plaintiffs sought during the litigation, which correspond to about $1 per tub, their attorneys said Wednesday in a filing.

The fee is also reasonable when measured against the attorneys’ lodestar, their time on the case multiplied by their hourly rates, they said.

Here, the attorneys’ said their lodestar is roughly $1.9 million for their work on the case, meaning their fee request represents a large downward adjustment.

Martinelli seeks a $7,500 incentive payment for her service as lead plaintiff.

Trans fats have been associated with a variety of health problems. The Food and Drug Administration said in June 2015 that partially hydrogenated oils are no longer “generally recognized as safe” and gave the industry three years to phase out trans fats from foods. A June 18, 2018, deadline was later extended by two years.

Bursor & Fisher PA is class counsel. Tucker Ellis LLP and O’Melveny & Myers LLP represent Johnson & Johnson and McNeil Nutritionals.

The case is Martinelli v. Johnson & Johnson, E.D. Cal., No. 2:15-cv-01733, motion 1/12/22.

To contact the reporter on this story: Julie Steinberg in Washington at jsteinberg@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Steven Patrick at spatrick@bloomberglaw.com

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