In The Dark Knight, Alfred counsels Batman about the folly of trying to get inside the mind and motivations of The Joker, warning Bruce that “some men just want to see the world burn.” This awesomely quotable line is about his dealings in Burma as a young man… certainly nothing problematic about an aging Brit’s stories about quelling dissent in Burma!
Putting aside the legacy of colonialism, I think about that line a lot whenever objectors barrel into a class action settlement threatening to ruin it for everyone. These folks who disingenuously want to wrap themselves in the cloak of “the poor victims” to pursue a long-term assault on the practical viability of class action litigation genuinely want the world Judge Posner famously described as “the realistic alternative to a class action is not 17 million individual suits, but zero individual suits.” In other words, they want to see the world burn… preferably from the pollution of their corporate backers.
And now one of the biggest antitrust awards ever is getting threatened by companies looking to make “keeping health insurance costs high for poor people” their brand… I guess?
Blue Cross Blue Shield agreed to a $2.7B settlement and injunctive relief back in 2020 following a class action antitrust suit brought around nine years ago. The underlying behavior was suitably complex for a national insurance brand with 50 ways of charging for aspirin, but the nutshell version is that entities selling BCBS were granted geographic fiefdoms and told they couldn’t intrude on a fellow BCBS seller’s area even if they were trying to sell non-BCBS products there. Also folks selling BCBS were told that non-BCBS products had to amount to less than a third of their revenue.
Since this looks and quacks like a cartel, federal antitrust authorities did… absolutely nothing. Leaving it to the private sector to protect the market. Boies Schiller brought claims on behalf of insureds harmed by BCBS’s anticompetitive actions, kicking off a case that ultimately boasted over 30 defendants, some 50 firms, and over 1,000 lawyers before it was all said and done.
But it was, at last, done. Judge David Proctor approved the settlement. BCBS would compensate the victims with the largest antitrust award ever secured in a case where the government never participated. More importantly BCBS would have to change its marketing rules and agree to a watchdog committee to make sure this never happens again. That’s the part of class actions that the propagandists always miss — these cases aren’t just about victims getting $25 when they might’ve lost $40, they’re also about making sure millions of future people never get bilked out of $40 in the first place.
So of course there are objectors looking to screw everything up for different reasons.
One entity filed a notice to appeal the approval “including but not limited to the order awarding fees and costs to class counsel.” This is the standard objection, whining about the lawyers getting paid out of the settlement and casting it as “stealing” from the victims as opposed to compensating the lawyers for working on a case for nine years — with the possibility of receiving zero for their effort if the case fails — to get relief that the victims were never going to see otherwise. That’s why these objections are typically filed by corporate defense lawyers in disguise hoping to stack the deck so future class action litigators fear the financial risk of taking on a case that might help people at the expense of corporate abusers.
But to hold everything, especially the injunctive relief, hostage over a fee award that clocks in at a mere 23 percent is a special kind of cynicism.
Meanwhile, Home Depot has complained that the injunctive relief itself doesn’t go far enough because BCBS can continue to limit the use of its trademarks on a geographic basis. Which is true, though if BCBS providers from other areas can come in and compete with products from other insurance companies, it’s not clear what extent of competitive damage remains. Yeah, trademark protection is inherently anticompetitive… but we allow it anyway.
And it’s definitely not clear why that justifies blowing up the whole deal. Do they want to drag this Bleak House litigation through court for another decade? Do they realize it’s not an actual house that needs renovation supplies?
And are they really willing to hold up billions in relief to squeeze out one more injunctive concession? They’re Home Depot! If they think BCBS will still be artificially too expensive after this deal, I’m sure there are other insurance providers ready and willing to take their business.
Maybe this is just inevitable when 1,000 lawyers get involved. But it’s also a reminder that sometimes we can’t have nice things because there are people out there willing to stake their personal claim no matter what they burn down around them.
Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.