After preliminary approval and notice, the court holds a hearing to consider whether the settlement should receive final approval. Rule 23(e)(2) directs consideration of adequacy of representation, arms-length negotiation, adequacy of relief accounting for costs and distribution effectiveness, and equitable treatment of class members.
Objectors may appear, and the court also rules on attorney's fees.
Alternative Names:
Fairness Hearing, Final Approval Hearing
Why it Matters?
Approval is not a formality, and courts have grown more demanding, particularly regarding actual claims rates, the ratio of fees to class recovery, and whether the notice program reached members. For defendants the practical concern is finality, since an objector's appeal can delay effectiveness for a year or more even where the objection lacks merit. Rule 23(e)(5) now requires court approval for objector settlements, which curbed the worst of that practice.
Frequently Confused with
Related terms
Frequently asked questions
What does the court consider at final approval?
Can an objector delay a settlement?
