(Reuters) - More than 900 people whose personal information was compromised in a 2017 data breach at the credit reporting agency Equifax have filed objections to the company’s proposed $700 million class action settlement, according to Reuben Metcalfe of Class Action Inc, who organized an Internet campaign to make it easier for Equifax class members to object to the deal.
Metcalfe, who wrote in a Nov. 8 Medium post that the Equifax settlement will provide most consumers with “orders of magnitude less than what was advertised,” told me this weekend that he sent 911 signed objections to Equifax claims administrator JND Legal Administration before the Nov. 19 objection deadline. He said that another 274 class members authorized objections but did not personally sign filings in time for them to be submitted to the claims administrator, but added that the failure to meet all procedural requirements is itself proof of the settlement’s unreasonably burdensome demands for consumers who don’t like the deal.
I reached out to JND principals Jennifer Keough, Neil Zola and David Isaac; Equifax counsel David Balser of King & Spalding; and class counsel Kenneth Canfield of Doffermyre Shields Canfield & Knowles, Amy Keller of DiCello Levitt Gutzler and Norman Siegel of Stueve Siegel Hanson. The JND execs said they had referred my inquiry to counsel for the parties. Those lawyers did not immediately respond to my emails. Class counsel Canfield previously told me that Metcalfe’s Medium post criticizing the Equifax settlement misrepresented key facts about the agreement, including the total amount of cash available to consumers. Canfield also said that millions of consumers have already filed claims for benefits from the proposed settlement.
Equifax and lawyers for the class have said the settlement is worth at least $700 million. The deal is supported by the Federal Trade Commission and received preliminary approval in a minute order from U.S. District Judge Thomas Thrash of Atlanta on July 22. A final approval hearing is scheduled for Dec. 19.
Metcalfe’s startup business, Class Action Inc, is designed to help consumers file class action claims in exchange for 5% of their recovery. As I’ve previously reported, the premise of the business is that consumers miss out on billions of dollars a year by failing to file claims in settled class actions. The startup, according to Metcalfe, has signed up more than 100,000 subscribers with the pitch they can pocket about $500 a year from class action settlements just by answering a few questions online. Metcalfe said that Class Action Inc does not intend to make a habit of organizing objector campaigns like the one he orchestrated against the Equifax settlement. (The business doesn’t make money from objections; it only collects when its subscribers receive payouts from class settlements.)
Metcalfe created an online repository for the consumer objections he says he filed with the Equifax claims administrator. I viewed only a small sampling of the filings, which reflect the automated, chatbot-assisted process Metcalfe designed to facilitate objections. Filers just checked boxes to indicate if they considered the proposed settlement to be unfair, inadequate, unreasonable or unduly burdensome.
But many filers also wrote personal notes to Judge Thrash expounding on those basic points. The comments are not legally sophisticated, but they provide a voice for real live consumers who are members of the class. “We as citizens are essentially forced to hand over our personal information to these credit reporting agencies,” one objector said. “They need to be held to the highest standard in regards to protecting information that could literally ruin our lives if, and when, in this case, it falls into the wrong hands. The disregard shown on behalf of Equifax is abhorrent, and the proposed settlement is spit in our faces.”
“It seems like a classic bait and switch to me,” wrote another objector, referring to a much-publicized provision in the settlement that was billed as an offer of as much as $125 in cash to class members who were already receiving credit monitoring services. That $32 million settlement fund was overwhelmed by claims and eligible class members are now projected to receive far less than $125. “They advertised that they would compensate (and) then, once they saw people take action, dropped the amount. Some of us ended up with things on our credit that has prevented us from being able to get jobs, reliable transportation, homes or credit cards. It’s not fair in any way.”
Equifax settlement proponents can certainly argue that 900 objectors from a class of nearly 145 million consumers is a negligible percentage. They will probably say that the percentage of objectors is minuscule compared to the sheer number of class members who have filed claims, both from the publicized $32 million fund for data breach victims whose personal information has not been misused and from a larger fund for claimants who can show they were forced to spend money as a result of the Equifax brief.
It’s also fair to say that the objectors who used the NothanksEquifax.com chatbot to file their protests are not asserting the kind of legal arguments that generally give federal judges pause about approving class action settlements. Metcalfe said he recognizes that Judge Thrash can discount objections that simply assert a settlement is unfair or unreasonable. He cited a brief by class action watchdog Ted Frank of the Hamilton Lincoln Law Institute for providing a more robust legal argument that the Equifax deal is flawed.
I asked Frank, who has probably had more success than any other class action objector, what he makes of the Metcalfe campaign. Frank said in an email that Metcalfe’s campaign to raise consumer awareness and organize objectors is “important,” but that Frank’s group has always emphasized that the quality of an objection – rather than the volume of objectors – is what matters. “A form objection stating ‘I don’t think this is fair’ or some other conclusory statement isn’t going to carry a lot of legal weight by itself,” Frank said.
Metcalfe told me Monday that he’s in discussions with public interest law groups that have said they’re interested in representing Equifax class members who used the chatbot to register their objections. Those lawyers, he said, would appear at the Dec. 19 fairness hearing. “We’re not done yet,” Metcalfe said.
I don’t know how much value Judge Thrash will ultimately ascribe to the nearly 1,000 objections Metcalfe drummed up. But I do know that in many years of reporting on class actions, I’ve never seen a campaign that inspired nearly 1,000 class members to go to the trouble – and it was considerable trouble, under the terms of the Equifax deal – to register objections to a proposed settlement.
Consumers have long had too soft a voice in class actions purportedly brought, litigated and settled on their behalf. Metcalfe is trying to amplify their influence. Class actions may never be the same.
Reporting by Alison Frankel