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In re Flonase Antitrust Litigation

United States District Court, Third Circuit

June 19, 2013

IN RE FLONASE ANTITRUST LITIGATION
v.
SMITHKLINE BEECHAM CORPORATION d/b/a GLAXOSMITHKLINE plc, Defendant. THIS DOCUMENT RELATES TO Indirect Purchaser Actions MEDICAL MUTUAL OF OHIO, on behalf of itself and all others similarly situated, Plaintiff,

MEMORANDUM

ANITA B. BRODY, J.

Following nearly five years of antitrust class action litigation between the makers of branded Flonase nasal spray, the makers of a generic brand version, indirect purchasers of the drug, and direct purchasers, the parties reached a global settlement in January 2013. Before me now is the Indirect Purchaser Plaintiffs’ (“IPPs”) Motion for Final Approval of Settlement (Doc. No. 574). After holding a fairness hearing on June 3, 203 and reviewing post-hearing submissions, I will now approve the final settlement agreement and allocation plan. I will also grant counsel’s request for attorneys’ fees, reimbursement of expenses, and incentive awards for class representative.

I. Background

Named plaintiffs A.F. of L.-A.G.C. Building Trades Welfare Plan (“AFL”), IBEW-NECA Local 505 Health & Welfare Plan (“IBEW”), Painters District Council No. 30 Health & Welfare Fund (“Painters”), and Andrea Kehoe (“Kehoe”), collectively “Indirect Purchasers, ” are indirect purchasers of the prescription drug Flonase and its generic equivalent. Flonase is the brand-name version of fluticasone propionate (“FP”), a nasal corticosteroid used to treat nasal inflammation caused by allergies and manufactured by Defendant SmithKline Beecham Corp., d/b/a GlaxoSmithKline PLC (“GSK”). Indirect Purchasers allege that GSK filed sham citizen petitions with the Food and Drug Administration to delay the entry of a cheaper, generic version of Flonase into the market, resulting in overcharges to the indirect purchasers.

This case has an extensive litigation history. The first Indirect Purchaser complaint was filed against GSK in July 2008.[1] Extensive discovery began in late 2008 and continued through mid-2010, including 30 depositions of current and former employees of GSK and Roxane Laboratories (“Roxane”), the maker of generic FP. Over a dozen expert reports and rebuttals were submitted. After extensive oral argument, I certified a class of indirect purchasers defined as follows:

A. With respect to the monopolization and UDTP claims

(1) For the Class Period from August 2004 through March 2006
All persons or entities throughout the United States and its territories who from August 2004 through March 2006 purchased, paid for, and/or reimbursed for branded Flonase in any of the following four states— Arizona, Florida, Massachusetts, or Wisconsin. These persons or entities must have also purchased, paid for, and/or reimbursed for an AB-rated generic fluticasone propionate nasal spray equivalent of branded Flonase (“generic FP”) from March 2006 to March 2009 in the same designated state in which the Flonase purchase was made.
(2) For the Class Period from March 2006 through March 2009
All persons or entities throughout the United States and its territories who from March 2006 to March 2009 purchased, paid for, and/or reimbursed for generic FP in the following states—Arizona, Florida, Massachusetts, or Wisconsin.

B. With respect to the unjust enrichment claims

(1) All persons or entities throughout the United States and its territories who from August 2004 through March 2006 purchased, paid for, and/or reimbursed for branded Flonase in any of the following three states— Arizona, Massachusetts, or Wisconsin. These persons or entities must have also purchased, paid for, and/or reimbursed for generic FP from March 2006 to March 2009 in the same designated state in which the Flonase purchase was made.

C. For purposes of the class definition, the Flonase and/or generic FP drugs must have been intended for consumption by the class members, their families or their members, employees, plan participants, beneficiaries, or insureds.

D. The following are excluded from the class:

(1) GSK and its respective subsidiaries and affiliates;
(2) all governmental entities (except for government funded employee benefit plans);
(3) all persons or entities that purchased FP nasal spray, including Flonase, for purposes of resale or directly from GSK to the extent and solely to the extent of such purpose for resale or as a direct purchase;
(4) insured individuals covered by plans imposing a flat dollar co-pay that was the same dollar amount for generic as for brand name drug purchases;
(5) fully insured health plans, i.e. plans that purchased insurance from another third-party payor covering 100% of the plan's reimbursement obligations to its members; and
(6) insured individuals who purchased only generic FP (never branded Flonase) and whose health plans imposed a flat dollar co-pay applicable to generic drugs.

In re Flonase Antitrust Litig., 284 F.R.D. 207, 216 (E.D. Pa. 2012).

In 2011, I denied two separate GSK motions for summary judgment, one on causation, and one on Noerr-Pennington immunity. See 798 F.Supp.2d 619 (E.D. Pa. 2011) and 795 F.Supp.2d 300 (E.D. Pa. 2011), respectively. The case was set for trial in early 2013, and both sides submitted over a dozen motions in limine. After extensive and vigorous settlement negotiations conducted by me in my chambers, over the course of multiple days, the parties reached a settlement agreement in November 2012, whereby GSK agreed to pay $46 million in exchange for the settlement of all indirect purchaser claims. That total includes an $11 million initial payment to a group of large health insurers (described below as the “SHPs”) and a $35 million payment for the remainder of the Indirect Purchaser Class. I preliminarily approved the settlement on January 14, 2013.

II. Final Approval of Settlement

According to Federal Rule of Civil Procedure 23(e), “The claims, issues, or defenses of a certified class may be settled, voluntarily dismissed, or compromised only with the court’s approval.” In other words, “a class action cannot be settled without the approval of the court and a determination that the proposed settlement is ‘fair, reasonable and adequate.’ ” In re Prudential Ins. Co. of Am. Sales Practice Litig., 148 F.3d 283, 316 (3d Cir.1998) (quoting In re G.M. Corp. Pick–Up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d 768, 785 (3d Cir.1995)).

The Third Circuit applies a nine prong test, known as the Girsh factors, when determining the fairness, adequacy, and reasonableness of a proposed class action settlement:

(1) the complexity, expense and likely duration of the litigation; (2) the reaction of the class to the settlement; (3) the stage of the proceedings and the amount of discovery completed; (4) the risks of establishing liability; (5) the risks of establishing damages; (6) the risks of maintaining the class action through the trial; (7) the ability of the defendants to withstand a greater judgment; (8) the range of reasonableness of the settlement fund in light of the best possible recovery; (9) the range of reasonableness of the settlement fund to a possible recovery in light of all the attendant risks of litigation.

Girsh v. Jepson, 521 F.2d 153, 157 (3d Cir.1975) (internal quotation marks and ellipses omitted). In more recent decisions, the Third Circuit has suggested an expansion of the nine-prong test when appropriate to include what are now referred to as Prudential considerations, such as:

the maturity of the underlying substantive issues, as measured by experience in adjudicating individual actions, the development of scientific knowledge, the extent of discovery on the merits, and other facts that bear on the ability to assess the probable outcome of a trial on the merits of liability and individual damages; the existence and probable outcome of claims by other classes and subclasses; the comparison between the results achieved by the settlement for *335 individual class or subclass members and the results achieved-or likely to be achieved-for other claimants; whether class or subclass members are accorded the right to opt out of the settlement; whether any provisions for attorneys’ fees are reasonable; and whether the procedure for processing individual claims under the settlement is fair and reasonable.

In re Prudential, 148 F.3d at 323; see also In re Pet Food Prods. Liab. Litig., 629 F.3d 333, 350 (3d Cir.2010). District courts “must make findings as to each of the Girsh factors, and the Prudential factors where appropriate, ” and “cannot substitute the parties’ assurances or conclusory statements for [their] independent analysis of the settlement terms.” In re Pet Food. 629 F.3d at 350–51.

Here, the Girsh factors and relevant Prudential considerations weigh in favor of settlement approval.

A. The Complexity, Expense, and Likely Duration of the Litigation

This suit involves highly complex antitrust issues, FDA bioequivalence standards for suspension nasal spray products, pharmaceutical manufacturing and supply issues, and pharmaceutical regulatory issues, all of which were investigated and litigated for more than four years. Antitrust class actions are particularly complex to litigate and therefore quite expensive. See In re Auto. Refinishing Paint Antitrust Litig., 2008 U.S. Dist. LEXIS 569, at *14 (E.D. Pa. Jan. 3, 2009) (“This litigation, like most antitrust cases, has been exceedingly complex, expensive, and lengthy.”) (emphasis added). “ ‘An antitrust class action is arguably the most complex action to prosecute. . . .’ ” In re Linerboard Antitrust Litig., 296 F.Supp.2d 568, 577 (E.D.Pa.2003) (quoting In re Motorsports Merchandise Antitrust Litig., 112 F.Supp.2d 1329, 1337 (N.D.Ga.2000)). The DPs and GSK reached this settlement after they had completed significant preparation for trial, including litigating Daubert challenges, identifying hundreds of trial exhibits, and briefing over a dozen motions in limine between them. The settlement avoided the need for a difficult and expensive multi-week trial involving complex scientific and regulatory testimony, and the time and expense associated with the appeal that would likely have followed a verdict. This factor strongly supports settlement.

B. The Reaction of the Class to the Settlement

Class counsel developed the notice plan in close consultation with the Settlement Administrator, Rust Consulting, Inc. and its legal notice affiliate, Kinsella Media LLC. After I preliminarily approved the settlement, a Postcard Notice was sent via USPS First Class mail to the Third Party Payor (“TPPs”) members of the class, using Rust Consulting’s proprietary list of roughly 40, 000 addresses for TPPs and their agents. In addition, a notice was published in a variety of national publications that were specifically selected to reach the age and gender targets most representative of Flonase users. Notice also appeared in an insert in newspapers and periodicals in the U.S. Territories, and a TPP notice appeared in an industry trade journal. Finally, targeted internet banner ads were published for 30 days. Through this notice plan, it was estimated that 80 percent of medication users were able to see the notice.

The reaction of the class has been overwhelmingly positive. As of March 22, 2013, 8, 065 consumer claim forms had been downloaded from the website. By May 28, 2013, 251 TPP Proofs of Claim with a value of nearly $750 million and 1, 908 Consumer Proofs of Claim with a value of nearly $900, 000 have been filed. Only one consumer requested exclusion from the class, though his exclusion does not appear related to the merits of the settlement. See Decl. of Marvin Miller in Further Support of Plaintiffs’ Motion for Final Approval at 2, Doc. No. 591. Two consumer objections were filed on the deadline for objections.[2] Both raise nearly identical objections: (1) that the notice is unclear and difficult to understand; (2) that the class representative awards are excessive; and (3) that the attorneys’ fees are excessive. However, I will strike both objections because neither objection contained any proof whatsoever that the objector was actually a member of the class.

The notice that was approved in my preliminary approval order informs class members that they must file with their objection proof of membership in the class. See Doc. No. 570, Attachment 1 at 8-9. Jill Jan, who does not appear to be a licensed attorney, purported to file an objection on behalf of her son Hondo Jan, who was a minor during the class period but who now appears to be of majority age.[3] Jan declares that she had prescriptions of Flonase filled for Hondo in 2004-2005, and stated that she “made purchases” of Flonase at Rite Aid, Walgreens, and Longs. However, she provides no proof except for a doctor’s note dated October 3, 2003— before the class period—referring to Flonase as a “current medication” of Hondo’s. Jan Objection Ex. A. The Payton objection includes even less: a simple declaration from Payton that he was “prescribed and was taking the medication, Flonase” and that he was “insured through Kaiser during 2004 and 2009 and co-pays were required.” He does not state that he purchased Flonase, or that the purchasers were made during the relevant class period, let alone provide receipts that would establish class membership. Because neither objection demonstrates that the objector is actually a member of the class, I will strike those objections.[4]

Even if I were to consider Jan’s and Payton’s objections to the class notice on the merits, I still find that notice was reasonable and that the reaction of the class weighs in favor of approval of the settlement. Both Jan and Payton objects that the notice is unclear because it does not explain what specific benefit each individual can expect to receive. Here, the notice adequately explained that class members will receive a pro rata share of the net settlement fund. More specific figures cannot be provided, because it depends on how many individuals file claims, and what share of the total relevant purchases each individual’s relevant purchases represent. In this settlement, every dollar of the net settlement fund will be distributed to the class; the exact figure, however, cannot be determined until all the claims have been submitted and processed.

In sum, even if the objections are considered, the reaction of the class to the settlement agreement has been overwhelmingly positive, with only one exclusion and two objections. These objections are procedurally deficient; moreover, their substantive complaints about the notice are meritless. Therefore, this factor counsels in favor of approval of the settlement.

C. The Stage of the Proceedings and the Amount of Discovery Completed

These proceedings advanced to a sufficiently late stage prior to settlement that the related Girsh and Prudential factors also weigh in favor of approval. Explaining the rationale behind the third Girsh factor, the Third Circuit wrote in Prudential:

The parties must have an “adequate appreciation of the merits of the case before negotiating.” To ensure that a proposed settlement is the product of informed negotiations, there should be an inquiry into the type and amount of discovery the parties have undertaken.

In re Prudential, 148 F.3d at 319 (quoting In re G.M., 55 F.3d at 813). Further, “courts generally recognize that a proposed class action settlement is presumptively valid where . . . the parties engaged in arm’s length negotiations after meaningful discovery.” Cullen v. Whitman Med Corp., 197 F.R.D. 136, 144-45 (E.D. Pa. 2000).

This factor also weighs strongly in favor of approval of the settlement agreement. This case was very advanced by the time the agreement was reached. Fact discovery concluded in February 2010 and included 45 depositions and millions of pages of documents. Expert discovery concluded in September 20110 and included the exchange of numerous expert reports. The parties briefed two separate motions for summary judgment. The Court heard Daubert motions concerning experts on both sides on two separate occasions. By the time the agreement was reached, the parties had exchanged trial witness lists, conferred on trial exhibits and deposition testimony to be used at trial, and submitted pretrial memoranda. Trial was just two months away when the parties reached their agreement.

D. The Risks of Establishing Liability and Damages.

These two Girsh factors are closely related, so I will address them together. This case involved complex scientific, regulatory, and legal issues, and plaintiffs faced many obstacles to success at trial. Among other things the Plaintiff would have to prove were two particularly difficult propositions: First, they would have had to prove that GSK’s petitions to the FDA regarding generic FP were objectively baseless and that GSK could not have reasonably expected success on the merits of any of its requests to the FDA. Second, and most crucially, Plaintiffs would have had to prove that GKS’s petitions to the FDA were a substantial cause of any delay in the approval of Roxane’s generic FP, and that, but for GSK’s actions, Roxane would have had the manufacturing capability to get its product to market sooner. These difficulties go both to Plaintiffs’ case for liability and their case for damages, as they would have had to show that GSK’s actions resulted in improper overcharges to the DPs. After facilitating these extensive settlement negotiations, I can attest to the challenges Plaintiffs would have faced in establishing the amount of their damages. Given the complexity of these issues, there is no guarantee that a jury would have found GSK liable, or how the jury would have responded to the complicated economic data necessary to show damages. Therefore, these two factors counsel in favor of settlement.

E. The Risks of Maintaining the Class Action Through Trial

Although I already certified the Indirect Purchaser class here, class certification is subject to review and modification at any time during the litigation. See Zenith Lab., Inc. v. Carter– Wallace, Inc., 530 F.2d 508, 512 (3d Cir.1976). The Third Circuit noted,

Because the district court always possesses the authority to decertify or modify a class that proves unmanageable, examination of this factor in the standard class action would appear to be perfunctory. There will always be a “risk” or possibility of decertification, and consequently the court can always claim this factor weighs in favor of settlement.

In re Prudential, 148 F.3d at 321. Since I certified this class a year ago, the Supreme Court released Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2012), which held that damages must be able to be measured classwide in order to sustain class certification. This opinion arguably renders class certification in cases like this one more difficult to prove. Because Plaintiffs would have faced a risk in maintaining a certified class throughout trial, this factor weighs in favor of approving the settlement.

F. The Ability of the Defendants to Withstand a Greater Judgment

This factor is also neutral. The ability of defendants to withstand a greater judgment generally only comes into play when “a settlement in a given case is less than would ordinarily be awarded but the defendant’s financial circumstances do not permit a greater settlement.” Reibstein v. Rite Aid Corp., 761 F.Supp.2d 241, 254 (E.D.Pa.2011). That does not appear to be the case. I have not been presented with any evidence indicating that GSK is at risk of insolvency. Regardless, I follow my district court colleagues within the Third Circuit who “regularly find a settlement to be fair even though the defendant has the practical ability to pay greater amounts.” Bredbenner v. Liberty Travel, Inc., 2011 WL 1344745, at *15, 2011 U.S. Dist. LEXIS 38663, at *42 (D.N.J. Apr. 8, 2011) (citing McCoy v. Health Net. Inc., 569 F.Supp.2d 448, 462 (D.N.J.2008); Weber v. Gov’t Emples. Ins. Co., 262 F.R.D. 431, 446 (D.N.J.2009)). Therefore, this Girsh factor neither supports nor undercuts the parties’ settlement.

G. The Range of Reasonableness of the Settlement Fund in Light of the Best Possible Recovery and All the Attendant Risks of Litigation

Taken together, the final two Girsh factors “test two sides of the same coin: reasonableness in light of the best possible recovery and reasonableness in light of the risks the parties would face if the case went to trial.” In re Warfarin Sodium Antitrust Litig., 391 F.3d 516, 538 (3d Cir. 2004). These factors confirm that the settlement here should be approved. A proposed settlement totaling a cash payment of $46 million, with $35 million going to the non-SHP Indirect Purchaser Class, is reasonable both in absolute terms and in light of the circumstances of this litigation, particularly the risks of establishing liability at trial. Under the settlement, each class member can benefit from the fund immediately, and avoid the uncertainties and delay inherent in continuing to litigate this complex class action.

In In re G.M. Corp. Pick–Up Truck Fuel Tank Prods. Liab. Litig., the Third Circuit warned “against demanding too large a settlement ... after all, settlement is a compromise, yielding of the highest hopes in exchange for certainty and resolution.” 55 F.3d 768, 806 (3d Cir.1995). With that warning in mind, I agree with class counsel and find that the $46 million amount, with $35 million going to the non-SHP Indirect Purchaser Class, is reasonable. Therefore, this factor weighs in favor of settlement.

H. Prudential Factors

In Prudential, the Third Circuit noted that, “since Girsh was decided in 1975, there has been a sea-change in the nature of class actions, ” noting that it therefore “may be useful to expand the traditional Girsh factors” to add additional topics for the district courts to take into consideration when reviewing a proposed settlement agreement. In re: Prudential Ins. Co. of Am. Sales Practice Litig., 148 F.3d 283 (3d Cir.1998). Here, the relevant Prudential factors counsel in favor of approving the settlement. First, as has been explained above, the case was settled only after extensive discovery and trial preparation. The underlying substantive issues were therefore well-developed, supporting approval of the settlement. Second, as to the results achieved for the individual class members compared to those achieved for other claimants, the settlement creates the only award for class members, and is thus beneficial to all indirect purchasers. Third, only one class member has opted out of the settlement, and he indicated his decision had nothing to do with the merits of the settlement. As to attorneys’ fees, as I will discuss in the next section, the provisions for attorneys’ fees are reasonable. Next, the procedure for processing individual claims under the settlement is fair and reasonable.

The Girsh factors and the Prudential factors all weigh strongly in favor of approval of the class settlement. I therefore find the settlement to be fair, reasonable, and adequate.

III.Attorneys’ Fees and Expenses

Class counsel seeks (i) an award of attorneys’ fees in the amount of $11, 655, 000, or one-third of the $35 million settlement fund (plus interest); (ii) reimbursement for litigation costs and expenses totaling $1, 848, 720.15; and (iii) approval of an incentive award of $25, 000 each to the AFL Plan, the IBEW Plan, Painters District Council, and Medical Mutual of Omaha and $10, 000 to Andrea Kehoe.

Federal Rule of Civil Procedure 23(h) states: “In a certified class action, the court may award reasonable attorneys’ fees and nontaxable costs that are authorized by law or by the parties’ agreement.” Class counsel informed the class in the long-form notice that it would ask the Court to award attorneys’ fees “in an amount not to exceed one-third of the Settlement Fund, plus interest.” Preliminary Approval, Attachment 1, Doc. No. 570. Nonetheless, “a thorough judicial review of fee applications is required in all class action settlements.” In re Prudential, 148 F.3d at 333 (quoting In re G.M., 55 F.3d at 819).

Courts generally use one of two methods for assessing attorneys’ fee requests: the lodestar method or the percentage-of-recovery method. In re Prudential, 148 F.3d at 333. The former is “more commonly applied in statutory fee-shifting cases, and is designed to reward counsel for undertaking socially beneficial litigation in cases where the expected relief has a small enough monetary value that a percentage-of-recovery method would provide inadequate compensation.” Id. The latter method, on the other hand, is “generally favored in cases involving a common fund . . . .” Id. Either way, “it is sensible for a court to use a second method of fee approval to cross-check its initial fee calculation.” In re Rite Aid Corp. Sec. Litig, 396 F.3d 294, 300 (3d Cir. 2005).

A. Applying the Gunter Factors

The settlement agreement at issue here establishes a common fund of $35 million, from which the class members will receive their allocations and the attorneys will receive any award and expense reimbursement. “[I]n the traditional common fund situation ... the district court ... should attempt to establish a percentage fee arrangement agreeable to the Bench and plaintiff’s counsel.” Report of the Third Circuit Task Force on Court Awarded Attorney Fees, 108 F.R.D. 237, 255 (1985). In order to make that determination, the Third Circuit has identified ten factors for the Bench to consider. These include:

(1) the size of the fund created and the number of beneficiaries, (2) the presence or absence of substantial objections by members of the class to the settlement terms and/or fees requested by counsel, (3) the skill and efficiency of the attorneys involved, (4) the complexity and duration of the litigation, (5) the risk of nonpayment, (6) the amount of time devoted to the case by plaintiffs’ counsel, (7) the awards in similar cases, (8) the value of benefits attributable to the efforts of class counsel relative to the efforts of other groups, such as government agencies conducting investigations, (9) the percentage fee that would have been negotiated had the case been subject to a private contingent fee arrangement at the time counsel was retained, and (10) any innovative terms of settlement.

In re Diet Drugs Prod. Liab. Litig., 582 F.3d 524, 541 (3d Cir.2009) (citing Gunter v. Ridgewood Energy Corp., 223 F.3d 190, 195 (3d Cir.2000); In re Prudential, 148 F.3d at 336–40). These Gunter/ Prudential factors are not exhaustive, and a district court should consider “‘any other factors that are useful and relevant with respect to the particular facts of the case.’” In re Diet Drugs, 582 F.3d at 541 n. 34 (quoting In re AT & T Corp. Sec. Litig., 455 F.3d 160, 166 (3d Cir.2006)).

1. The size of the fund created and the number of beneficiaries

The settlement creates a $35 million settlement fund. The indirect purchaser class members will receive a pro rata share based on their purchases of Flonase from the net fund, after attorneys’ fees, expenses, and incentive awards, plus accrued interest, are removed. This is a sizeable settlement, and provides immediate and certain payment to the class members. Every dollar of the net fund will be distributed to class members. This factor counsels in favor of approval of the requested fee.

2. The presence or absence of substantial objections by members of the class to the settlement terms and/or fees requested by counsel

As discussed above, there were two objections filed, though only one was timely. They both purport to object to the attorneys’ fees. Jan states only that a one-third award is “too much” and states that the lawyers should not receive more than the class. Payton argues that the reasonableness of the fees cannot be determined until the SHPs have been paid; otherwise, the requested $11, 655, 000 may be more than one-third of what is actually left for the class. Although I have decided to strike both objections, I will still address their substantive arguments.

Payton misunderstands the settlement. The SHPs are TPPs that would have been members of the Class but for their separate settlement. Under the provisions of the Settlement Agreement, the SHP Agreement, and the class Plan of Allocation, if the SHPs’ pro rata share of qualifying purchases entitles them to money from the $35 million settlement fund (i.e., if the $11 million received already is insufficient to meet their pro rata share), that amount takes into account their share of the fees on the $35 million. In other words, remaining members of the Class would still be paying only one-third of their allocation of the fund. The entire net settlement amount will be going to class members, based on pro rata divisions. Therefore, a percentage-based fee will always reflect a percentage of the funds going to the class itself.

These objections are procedurally deficient and need not be considered. Regardless, on the merits they raise no “substantial” objection to the attorneys’ fee proposal. This factor therefore supports approval of the requested fee.

3. The skill and efficiency of the attorneys involved

The Third Circuit has explained that the goal of the percentage fee-award device is to ensure “that competent counsel continue to undertake risky, complex, and novel litigation.” Id. at 198. The Cullen court explained that “[t]he single clearest factor reflecting the quality of class counsels' services to the class are the results obtained.” Cullen v. Whitman Medical Corp., 197 F.R.D. 136, 149 (E.D. Pa. 2000).

Class counsel are highly regarded in the complex class action and antitrust communities. The manner in which they conducted this complicated and lengthy litigation demonstrates skill and expertise. Indeed, counsel for both sides were knowledgeable, tenacious, and highly skillful. As discussed above, the settlement award represents a substantial amount and clearly demonstrates the value of class counsel’s efforts. This factor supports approval of the requested fee.

4. The complexity and duration of the litigation

I have already addressed this matter above in my discussion of the Girsh factors. This factor weighs strongly in favor of the proposed fee.

5. The risk of nonpayment

The risk of nonpayment here was not negligible. Even if Plaintiffs had succeeded in proving liability at trial, there is no guarantee they would have recovered damages. See, e.g., U.S. Football League v. National Football League, 644 F.Supp. 1040, 1042 (S.D.N.Y. 1986) (noting the jury’s award of only $1 in nominal damages to the plaintiffs). Moreover, as a contingent fee case, counsel faced a risk of nonpayment in the event of an unsuccessful trial. Throughout this lengthy litigation, class counsel have not received any payment. This factor supports approval of the requested fee.

6. The amount of time devoted to the case by plaintiffs’ counsel

According to their declaration, class counsel spent more than 32, 700 hours over the course of more than four years litigating this case. The record of this litigation also indicates that the time spent by Plaintiffs’ counsel was necessary for the successful prosecution of this case, considering both the complexity of the issues and the robust defense mounted by the defendants. This factor weighs in favor of the requested fee.

7. The awards in similar cases

A one-third fee award is standard in complex antitrust cases of this kind. Indeed, a one-third award “is consistent with awards in other complex antitrust actions involving the pharmaceutical industry.” In re Remeron Direct Purchaser Antitrust Litig., No. 03-0085, 2005 WL 3008808, at *16 (D.N.J. Nov. 9, 2005) (citing In re Relafen Antitrust Litig., No. 01-12239-WGY (D. Mass. April 9, 2004) (awarding 33.33 % fee of a $175 million settlement); In re Buspirone Antitrust Litig., No. 01-CV-7951 (JGK) (S.D.N.Y. April 1, 2003) (awarding a 33.33 % fee of a $220 million settlement); North Shore Hematology-Oncology Associates, P.C. v. Bristol Myers Squibb Co., No. 1:04cv248 (EGS) (D.D.C. Nov. 30, 2004) (awarding a 33.33 % fee of a $50 million settlement); In re Terazosin Hydrocholride Antitrust Litig., No. 99-MDL-1317 (S.D. Fla. Apr. 19, 2005); (awarding a 33.33 % fee of a $72.5 million settlement)). The complexity of this litigation, combined with the contingent nature of class counsel’s representation, warrant the requested one-third fee award.

8. The value of benefits attributable to the efforts of class counsel relative to the efforts of other groups, such as government agencies conducting investigations

Class counsel was not assisted by a government investigation. In Prudential, the Third Circuit singled this factor out for important consideration by district courts. See In re Prudential, 148 F.3d at 338. The appeals court remanded the trial court’s fee award for wrongly “credit[ing] class counsel with creating the entire value of the settlement” and overlooking the considerable contributions of a multi-state life insurance task force. Id. Yet this case is more similar to In re AT & T, in which the Third Circuit found that “class counsel was not aided by the efforts of any governmental group, and the entire value of the benefits accruing to class members is properly attributable to the efforts of class counsel.” In re AT & T, 455 F.3d at 173. This factor weighs in favor of the proposed fee.

9. The percentage fee that would have been negotiated had the case been subject to a private contingent fee arrangement at the time counsel was retained

It is extremely difficult to determine what fee would have been negotiated at the outset of the litigation. I can only look to my colleagues who have attempted to apply this factor, even though I recognize that the contingent fee can only be “based on the particular facts and circumstances of the specific litigation under consideration.” In re United States Bioscience Sec. Litig., 155 F.R.D. 116, 119 (E.D.Pa.1994). After appointing a Special Master to study the award of attorneys’ fees in a class action securities suit, Judge Dalzell approved of the Special Master’s recommendation that a thirty percent fee award was an appropriate estimate of what would have been negotiated. See id. (citing Report and Recommendation of Special Master Judge Arlin M. Adams). Judge Katz noted that in private contingency fee cases, “plaintiffs’ counsel routinely negotiate agreements providing for between thirty and forty percent of any recovery.” In re Ikon, 194 F.R.D. at 194. But Judge Katz was referring to tort matters, in particular.

In the end, I do “not give great weight to this hypothetical exercise.” In re Prudential, 148 F.3d at 340. Although this is not a proposed settlement in the range of Prudential’s $1 billion, this is still a significant sum of money that should not be subjected to such arbitrary calculations. Therefore, this factor is neutral and will not be considered to count for or against the proposed fee request.

10. Any innovative terms of settlement.

The terms of this settlement are relatively standard. In the absence of any innovative terms, this factor neither weighs in favor nor against the proposed fee request.

11. Summation

I recognize that the Gunter/Prudential factors “‘need not be applied in a formulaic way’ because each case is different, ‘and in certain cases, one factor may outweigh the rest.’” In re AT & T, 455 F.3d at 166 (citing In re Rite Aid. 396 F.3d at 301). This case, however, does not “involv[e] [an] extremely large settlement award[ ], ” and therefore I am not as inclined to “give some of these factors less weight in evaluating a fee award.” In re AT & T, 455 F.3d at 166. In sum, after “‘engag[ing] in a robust assessment [ ] of the fee award reasonableness factors, ’” I have determined that eight of the ten Gunter/Prudential factors count in favor, while the remaining two are neutral. Id. (citing In re Rite Aid, 396 F.3d at 302). Therefore, there is overwhelming support for the proposed fee. The lodestar cross-check, moreover, militates in favor of approval.

B. Lodestar

“The lodestar award is calculated by multiplying the number of hours reasonably worked on a client’s case by a reasonable hourly billing rate for such services based on the given geographical area, the nature of the services provided, and the experience of the attorneys.” In re Rite Aid, 396 F.3d at 305. Once the lodestar is calculated, “[t]he total lodestar estimate is then divided into the proposed fee calculated under the percentage method. The resulting figure represents the lodestar multiplier to compare to multipliers in other cases.” Manual for Complex Litigation (Fourth) § 14.122 (2004).

1. Number of Hours and Hourly Rates

Class counsel reports that they cumulatively spent more than 37, 761.95 hours litigating this case over the last nearly five years. Fifteen different firms worked on the Plaintiffs’ case, though the vast majority of hours were logged by the two lead counsel firms, Miller Law LLC and Pomerantz Grossman Hufford Dahlstrom & Gross LLP, who collectively reported more than 25, 000 hours of work on the case. Class counsel submitted copies of their time and expense records for in camera review. The nearly five years of work included, among other work, preparing the complaint; conducting extensive discovery including taking dozens of depositions of current and former employees of GSK and Roxane; filing for class certification; submitting over a dozen opening and rebuttal expert reports; opening and defending Daubert challenges; defending two separate motions for summary judgment; and preparing for trial, including filing and defending against motions in limine. The law firms charged different amounts based on their average billable rates and the individual attorney or staff member working on the assignment; each firm’s average billable rate ranged from $275 to $750 per hour.

In total, class counsel reports that they spent 32, 761.95 hours, which cost a total of $17, 280, 746.50 at the firms’ various current hourly billing rates. That averages to a billing rate of $527 per hour. The lodestar amount is therefore $17, 280, 746.50 as of January 31, 2013.

2. Lodestar Multiplier

“After a court determines the lodestar amount, it may increase or decrease that amount by applying a lodestar multiplier.” In re Diet Drugs Prod. Liab. Litig., 582 F.3d 524, 539 (3d Cir.2009) (citing In re Rite Aid, 396 F.3d at 305–06). The Third Circuit explained that “multipliers may reflect the risks of non-recovery facing counsel, may serve as an incentive for counsel to undertake socially beneficial litigation, or may reward counsel for extraordinary result. By nature they are discretionary and not susceptible to objective calculation.” In re Prudential, 148 F.3d at 340. The lodestar multiplier is calculated by dividing the attorneys’ fees sought by class counsel ($11, 655, 000) by the total amount of hours class counsel devoted to the litigation times class counsel’s hourly rates ($17, 280, 746.50). Here, that calculation comes to a negative multiplier of 0.67, meaning class counsel would receive less under a percentage fee award than their regular billing rates. The Third Circuit has recognized that “multiples ranging from one to four are frequently awarded in common fund cases when the lodestar method is applied.” Cullen v. Whitman Med. Corp., 197 F.R.D. 136, 150 (2000) (Brody, J.) (internal quotation omitted). See also In re Cendant Corp. PRIDES Litig., 243 F.3d 722, 742 (3d Cir.2001) (citing In re Prudential, 148 F.3d at 341).

A negative multiplier strongly underscores the risk counsel accepted to prosecute this case to trial. As the Third Circuit explained, “The lodestar multiplier . . . was less than one and thus reveals that Class Counsel’s fee request constitutes only a fraction of the work they billed.” In re Ins. Brokerage Antit. Litig., 579 F.3d 241, 284 (3d Cir. 2009). The lodestar crosscheck therefore provides additional support for approving the attorneys’ fees request. Thus I will award counsel thirty-three and a third percent of the common fund, for a total of $11, 655, 000 in attorneys’ fees.

C. Costs

Class counsel requests reimbursement of $1, 848, 720.15 for expenses incurred litigating the case. Nearly half fees paid to experts, investigators, accountants, etc. Another substantial portion was for assessment payments to the litigation fund Co-Lead Counsel established for the common expenses incurred in the prosecution of this case. Counsel had a strong incentive to conserve their expenses, given that they were incurred with no guarantee of recovery. I find that these expenses were reasonable and proper. Therefore, I will award counsel a reimbursement of these expenses from the settlement fund.

IV. Incentive Awards for Class Representatives

Incentive awards are “not uncommon in class action litigation and particularly where, as here, a common fund has been created for the benefit of the entire class.” In re Southern Ohio Correctional Facility, 175 F.R.D. 270, 272 (S.D. Ohio 1997). As a matter of practice, “courts routinely approve incentive awards to compensate named plaintiffs for the services they provided and the risks they incurred during the course of the class action litigation.” Id. (citing numerous cases in which incentive awards were granted). I agree with my colleagues who have held that “[r]easonable payments are permissible to compensate named plaintiffs for the expenses they incur during the course of class action litigation.” First State Orthopaedics v. Concentra. Inc., 534 F.Supp.2d 500, 524–25 (E.D. Pa.2007) (referencing Nichols v. SmithKline Beecham Corp., No. 00-6222, 2005 WL 950616, at *24 (E.D. Pa. April 22, 2005); Godshall v. Franklin Mint Co., No. 01-6539, 2004 WL 2745890 (E.D. Pa. Dec. 1, 2004, )).

Plaintiffs seek and incentive award of $25, 000 each to the AFL Plan, the IBEW Plan, Painters District Council, and Medical Mutual of Omaha, and $10, 000 for Andrea Kehoe. While an incentive award is appropriate, the request is far too high. I will award $10, 000 each to the ALF Plan, the IBEW Plan, Painters District Counsel, and Medical Mutual of Omaha, and $5, 000 to Kehoe.

Class counsel states that the class representatives “were actively engaged and willingly available to assist Class Counsel with the effective prosecution of the case. Pls.’ Mem. in Support of Pls.’ Motion for Final Approval of Settlement 35, Doc. No. 575. However, they provide no evidence that the representatives actually played a substantial role in the litigation, aside from sitting for depositions. Indeed, the declarations provided by the named plaintiffs show that most of them spent no more than 12 hours, over many years, on the case. See Miller Decl. Ex. B, Doc. 591.

These incentive awards are within the range of payments awarded by other courts in this circuit. See, e.g., Hall, 274 F.R.D. at 173-174 (approving incentive award of $5, 000 per named plaintiff); In re CertainTeed Corp. Roofing Shingle Prods. Liab. Litig., 269 F.R.D. 468, 476 (E.D. Pa. 2010) (“If the named plaintiff was deposed, the named plaintiff’s incentive payment will be $5, 000; if the named plaintiff was not deposed, the named plaintiff’s incentive payment will be $2, 500”); In re. Am. Investors Life Ins. Co. Annuity Mktg. & Sales Practices Litig., 263 F.R.D. 226, 245 (E.D. Pa. 2009) (incentive award of between $5, 000 and $10, 500 where named plaintiffs prepared for and testified in depositions that exposed their private financial affairs, participated in preparing responses to interrogatories, and produced extensive documents).

V. Plan of Distribution and Proposed Claim Form

When assessing proposed plans of allocation, courts use the same standard for determining whether to approve the settlement itself. Therefore, the proposed plan needs to be fair, reasonable and adequate. In re Cendant Corp. Litig., 264 F.3d 201, 248 (3d Cir.2001). “In general, a plan of allocation that reimburses class members based on the type and extent of their injuries is reasonable.” In re Ikon Office Solutions, Inc. Sec. Litig., 194 F.R.D. 166, 184 (E.D.Pa.2000). The plan of distribution, which was submitted with the Plaintiffs’ memorandum in support of its motion for preliminary approval of the settlement (Doc. No. 566 at p.226-238) meets this standard.

I find that the proposed plan, submitted with Plaintiff’s Motion for Preliminary Approval of Settlement (Doc. 566) is fair, reasonable, and adequate. I also find that the proposed claim form is clear, fair, and reasonable.

VI. Conclusion

For the reasons explained above, I will grant Plaintiff’s Motion for Final Approval of Settlement and their Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses, and Payment of Incentive Awards to the Representative Plaintiffs.

FINAL ORDER AND JUDGMENT

This matter came for a duly-noticed hearing on June 3, 2013 (the “Final Approval Hearing”), upon the Plaintiffs’ Motion for Final Approval of Settlement between Defendant SmithKline Beecham Corporation d/b/a GlaxoSmithKline, including GlaxoSmithKline LLC and GlaxoSmithKline plc (“GSK” or “Defendant”) and Plaintiffs A.F. of L. A.G.C. Building Trades Welfare Plan (“AFL”), IBEW NECA Local 505 Health & Welfare Plan (“IBEW”), Painters District Council No. 30 Health and Welfare Plan (“Painters”), Medical Mutual of Ohio, Inc. (“MMOH”), and Andrea Kehoe (“Kehoe”), individually and on behalf of a class (collectively “Plaintiffs”) in IBEW NECA Local 505 Health & Welfare Plan v. SmithKline Beecham Corp., No. 08-3301 (E.D. Pa.), and Medical Mutual of Ohio, Inc. v. SmithKline Beecham Corp., No. 12-cv-4212 (E.D. Pa.) (the “Actions”), (the “Motion”). GSK and Plaintiffs are collectively referred to as the Parties. Due and adequate notice of the Settlement Agreement having been given to the members of the Settlement Class, the Final Approval Hearing having been held and the Court having considered all papers filed and proceedings had herein and otherwise being fully informed in the premises and good cause appearing therefor, and a determination having been made expressly pursuant to Rule 54(b) of the Federal Rules of Civil Procedure that there is no justification for delay,

IT IS HEREBY ORDERED, ADJUDGED AND DECREED:

1. This Final Order and Judgment hereby incorporates by reference the definitions in the Settlement Agreement dated December 6, 2012 (the “Settlement Agreement”), and all terms used herein shall have the same meanings as set forth in the Settlement Agreement.

2. This Court has jurisdiction over the subject matter of the Actions and over all parties to the Actions and over all members of the Settlement Class.

3. The Court finds that due process and adequate notice have been provided pursuant to Rule 23 of the Federal Rules of Civil Procedure to all members of the Settlement Class, notifying the Settlement Class of, among other things, the pendency of these Actions and the proposed Settlement with GSK.

4. The notice provided was the best notice practicable under the circumstances and included individual notice to those members of the Settlement Class whom the parties were able to identify through reasonable efforts. The Court finds that Notice was also given by publication in multiple publications as set forth in the Declarations of Daniel Coggeshall and Katherine Kinsella dated May 1, 2013. Such notice fully complied in all respects with the requirements of Rule 23 of the Federal Rules of Civil Procedure and due process of law.

5. Pursuant to and in compliance with Rule 23 of the Federal Rules of Civil Procedure, the Court hereby finds that due and adequate notice of these proceedings was directed to all Settlement Class members of their right to object to the Settlement, the Plan of Allocation, including the SHP-Class Allocation Agreement (“Plan of Allocation”), and Class Counsel’s application for incentive payments for named Plaintiffs, payment of attorneys’ fees and reimbursement of expenses associated with the Actions. A full and fair opportunity was accorded to all members of the Settlement Class to be heard with respect to the foregoing matters.

6. The Court finds that, for settlement purposes, under the requirements of Rule 23 of the Federal Rules of Civil Procedure, the following Settlement Class is hereby certified:

All persons throughout the United States and its territories who purchased and/or paid for, in whole or in part, fluticasone propionate nasal spray, whether branded Flonase or its AB-rated generic equivalents, intended for the consumption of themselves, their family members and/or household members, and all Third Party Payor entities throughout the United States and its territories that purchased, paid for, administered and/or reimbursed for fluticasone propionate nasal spray, whether branded Flonase or its generic equivalents, intended for consumption by their members, employees, plan participants, beneficiaries or insureds.
The applicable time period for the Settlement Class is May 19, 2004 through March 31, 2009.
Third Party Payors are all health insurance companies, healthcare benefit providers, health maintenance organizations, self-funded health and welfare plans, and any other health benefit provider and/or entity that contracts with a health insurer acting as a third party administrator to administer their prescription drug benefits. These payors include such entities that may provide prescription drug benefits for current or former public employees and/or retirees, but only to the extent that such entity was at risk for the cost of the payment(s). For purposes of this definition, an entity “paid for” fluticasone propionate nasal spray (branded Flonase and/or its equivalents) if it paid some or all of the purchase price, or reimbursed any part of the purchase price paid by their members, employees, insureds, participants or beneficiaries.

7. Excluded from the Settlement Class are: (1) Defendant and its officers, directors, management, employees, predecessors-in-interest, successors-in-interest, assignees or affiliates, and subsidiaries; (2) the United States and/or State governments and their agencies and departments, except to the extent they purchased fluticasone propionate nasal spray (branded Flonase and/or its generic equivalents) for their employees or others covered by a government employee health plan; (3) all entities who purchased fluticasone propionate nasal spray (branded Flonase and/or its generic equivalents) directly from Defendant or its affiliates or purchased fluticasone propionate nasal spray (branded Flonase and/or its generic equivalents) for resale, to the extent and solely to the extent of such purchase as a direct purchaser or for resale; (4) any judge or special master who has presided over the Actions; (5) the health benefit plans listed in Exhibit A to the Settlement Agreement (“Settling Health Plans” or “SHPs”); and (6) those persons who would otherwise be members of the Settlement Class who have timely excluded themselves from the Settlement Class and who are identified on the schedule attached hereto as Exhibit 1. No other individuals or entities have excluded themselves from the Settlement Class.

8. It is hereby determined that all members of the Settlement Class are bound by this Final Order and Judgment.

9. For purposes of settlement, the Court finds that the requirements of Rule 23 are satisfied as follows:

The members of the Settlement Class are so numerous that joinder of all members is impracticable.

In the context of settlement, there are common issues of law and fact as to whether the conduct challenged violates state antitrust and consumer protection statutes and/or constitutes unjust enrichment under various state laws.

In the context of settlement, the claims of the named Plaintiffs are typical of the claims of the Settlement Class.

In the context of settlement, Class Counsel will fairly and adequately protect and represent the interests of all members of the Settlement Class, and the interests of the named Plaintiffs are not antagonistic to those of the Settlement Class. The named Plaintiffs and the Settlement Class are represented by counsel who are experienced and competent in the prosecution of complex class action antitrust litigation.

In the context of settlement, questions of law and fact common to the Settlement Class predominate over questions that may affect only individual members and a class action is superior to other available methods for the fair and efficient adjudication of these Actions.

10. Pursuant to Rule 23 of the Federal Rules of Civil Procedure, this Court hereby approves the Settlement, as set forth in the Settlement Agreement and the Plan of Allocation, and finds that the Settlement Agreement and Plan of Allocation are, in all respects, fair, reasonable and adequate, and in the best interests of the Settlement Class, including Plaintiffs. This Court further finds that the parties’ Settlement resulted from an extensive investigation of facts, complete discovery, expert analysis and reports, motion practice, and development of the case for trial and that the Settlement set forth in the Settlement Agreement and Plan of Allocation are the result of bona fide and arm’s-length negotiations conducted in good faith between experienced counsel representing the interests of Plaintiffs, the Settlement Class, and GSK. The Settlement is fair, reasonable and adequate in light of the factors set forth in Girsh v. Jepson, 521 F.2d 153 (3rd Cir. 1975), as explained in the accompanying memorandum.

11. The Court has held a hearing to consider the fairness, reasonableness and adequacy of the proposed Settlement, and has been advised that there have been two objections to the Settlement from purported members of the Class. Despite the fact that the objections were not timely filed and each objector failed to provide proof of class membership, the Court has considered and found the objections to lack merit.

12. Accordingly, the Settlement embodied in the Settlement Agreement and Plan of Allocation is hereby approved in all respects. The Parties are hereby directed to consummate the Settlement Agreement and Plan of Allocation in accordance with all of their terms and provisions, including the Termination provisions.

13. Subject to the terms set forth in paragraph 13 of the Settlement Agreement, if final approval is reversed, vacated, or otherwise modified on appeal, or if appellate review is sought and on such review final judgment is reversed, vacated, or modified, the Settlement Agreement shall be terminated upon the election of either (a) Plaintiffs, through Class Counsel, or (b) GSK.

14. Notwithstanding the provisions of any other paragraph of this Final Order and Judgment, if the Settlement Agreement is terminated pursuant to the terms of the Settlement Agreement, or for any other reason does not become effective in accordance with its terms, then (a) the Settlement Agreement shall be of no force or effect, except for the payment of notice and settlement administration costs from the Settlement Fund; and (b) the Settlement Fund, including any and all interest earned thereon, shall be returned to GSK less only the amount validly disbursed for the costs incurred in giving notice to the Settlement Class and administering the Settlement Fund during the interim period, and (c) any release pursuant to the Settlement Agreement shall have no force or effect, and (d) this Final Order and Judgment shall be rendered null and void as provided by the Settlement Agreement, shall be vacated, and all orders entered and releases delivered in connection herewith shall be null and void to the extent provided by and in accordance with the Settlement Agreement.

15. The Court approves the Plan of Allocation of the Settlement proceeds (net of attorneys’ fees, reimbursed expenses, incentive awards, and costs of administration) proposed by Plaintiffs as fair, reasonable and adequate. The Plan of Allocation proposes to distribute the net Settlement proceeds pro rata based on Class members’ purchases of Flonase during the Class period, and does so fairly and efficiently. The Court directs Rust Consulting, Inc., the Claims Administrator retained by class counsel and approved by the Court in the preliminary approval order, to distribute the net Settlement proceeds to Class members in the manner provided in the Plan of Allocation.

16. Class members shall look solely to the net Settlement proceeds for settlement and satisfaction against Defendant of all claims that are released by this Order, and shall not under any circumstances be entitled to any further compensation from Defendant with respect to any claims released by this Order. Except as provided by this Order, no Class member shall have any interest in the Settlement proceeds or any portion thereof.

17. Any and all disputes arising out of or related to the Settlement, the Settlement Agreement, the Plan of Allocation, or claims administration, including attorneys’ fees, must be brought by Defendant, Plaintiffs, each member of the Settlement Class, and/or any other person or entity, exclusively in this Court.

18. The Court reserves exclusive and continuing jurisdiction, without affecting in any way the finality of this Final Order and Judgment, over the Settlement, Settlement Agreement and the Settlement Fund, the Plan of Allocation, the administration, consummation and interpretation of the Settlement Agreement or Plan of Allocation, and the enforcement of this Final Order and Judgment. The Court also retains exclusive jurisdiction in order to resolve any disputes that may arise with respect to the Settlement Agreement, the Settlement, the Plan of Allocation, the Settlement Fund, or allocation of attorneys’ fees and reimbursed expenses, to consider or approve administration costs and fees, and to consider or approve the amounts of distributions to members of the Settlement Class. In addition, without affecting the finality of this Final Order and Judgment, Defendant, Plaintiffs and each Settlement Class member hereby irrevocably submit to the exclusive and continuing jurisdiction of the United States District Court for the Eastern District of Pennsylvania, for any suit, action, proceeding or dispute arising out of or relating to this Settlement or the Settlement Agreement or the applicability or interpretation of the Settlement Agreement, or the Final Order and Judgment, including, without limitation any suit, action, proceeding or dispute relating to the Release provisions therein, except that this submission to the Court’s jurisdiction shall not prohibit: (a) any Released Party from asserting in the forum in which a claim is brought that the Release included in the Settlement Agreement is a defense, in whole or in part, to such claim or (b) in the event that such a defense is asserted in that forum and this Court determines it cannot bar the claim, the determination of the merits of the defense in that forum.

19. As used throughout this Order, references to the “Settlement Class, ” “members of the Settlement Class, ” or “Settlement Class members” refer to members of the Settlement Class and include any of their past, present or future officers, directors, stockholders, attorneys, employees, legal representatives, trustees, agents, parents, subsidiaries, general and limited partners, heirs, executors, administrators, purchasers, predecessors, successors and assigns, acting in their capacity as such.

20. Upon the Settlement Agreement becoming effective in accordance with its terms, Defendant and its past, present and future parents, subsidiaries, divisions, affiliates, stockholders, officers, directors, insurers, general or limited partners, employees, agents, attorneys, and any of their legal representatives (and the predecessors, heirs, executors, administrators, successors, purchasers, and assigns of each of the foregoing) (the “Released Party” or “Released Parties”), are and shall be released and forever discharged from all manner of claims, demands, actions, suits, causes of action, damages whenever incurred, and liabilities of any nature whatsoever (whether such claims, demands, actions, suits, causes of action, damages or liabilities arise or are incurred before, during or after the date hereof), including costs, expenses, penalties and attorneys’ fees known or unknown, suspected or unsuspected, in law or equity, that Plaintiffs or any member or members of the Settlement Class, whether or not they object to the Settlement and whether or not they make a claim upon or participate in the Settlement Fund, ever had, now has, or hereafter can, shall or may have, directly, indirectly, representatively, derivatively or in any other capacity relating to any conduct, events or transactions, prior to the date hereof, alleged or which could have been alleged in the Actions relating to fluticasone propionate nasal sprays (branded Flonase and/or its generic equivalents) (the “Released Claims”). Except for enforcing the Settlement Agreement, each member of the Settlement Class hereby covenants and agrees that he, she or it shall not, hereafter, seek to establish liability against any Released Party based, in whole or in part, on any of the Released Claims. Without in any way limiting the definition of Released Parties, the following specific entities are Released Parties: SmithKline Beecham Corporation d/b/a GlaxoSmithKline; GlaxoSmithKline LLC; GlaxoSmithKline Holdings (America) Inc.; GlaxoSmithKline plc; Smith Kline Beecham plc; Glaxo Wellcome plc.; GlaxoSmithKline Finance plc.; GlaxoSmithKline Services Unlimited; and Smith Kline Beecham Limited. In addition, Plaintiffs and each Settlement Class member hereby expressly waives and releases, upon the Settlement becoming effective pursuant to paragraph 5 of the Settlement Agreement, any and all provisions, rights and benefits conferred by § 1542 of the California Civil Code, which reads:

Section 1542. General Release — Claims Extinguished. A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor;

or rights and benefits conferred by any law of any state or territory of the United States or any other jurisdiction, or principle of common law, which is similar, comparable or equivalent to § 1542 of the California Civil Code. Plaintiffs and each Settlement Class member may hereafter discover facts other than or different from those which he, she or it knows or believes to be true with respect to the claims which are the subject matter of this paragraph, but each Plaintiff and each Settlement Class member hereby expressly waives and fully, finally and forever settles and releases, upon the Settlement Agreement becoming final, any known or unknown, suspected or unsuspected, contingent or non-contingent claim that would otherwise fall within the definition of Released Claims, whether or not concealed or hidden, without regard to the subsequent discovery or existence of such different or additional facts. Plaintiffs and each Settlement Class member also hereby expressly waives and fully, finally and forever settles and releases any and all claims it may have against any Released Party under § 17200, et seq., of the California Business and Professions Code, or any similar, comparable or equivalent provision of the law of any other state or territory of the United States or other jurisdiction or principle of common law, which claims are hereby expressly incorporated into the definition of Released Claims. The releases set forth above shall not release any claims arising in the ordinary course of business among Plaintiffs, Settlement Class members and the Released Parties concerning product liability, breach of warranty or contract (other than breach of warranty or contract based in whole or in part on any conduct challenged in the Actions), and/or personal or bodily injury, and/or any claims for costs of providing medical care for individuals allegedly injured by fluticasone propionate nasal spray products.

21. Plaintiffs and all members of the Settlement Class, the successors and assigns of any of them, and anyone claiming through or on behalf of any of them, whether or not they execute and deliver a proof of claim, are hereby permanently enjoined from commencing, instituting, causing to be instituted, assisting in instituting or permitting to be instituted on his, her or its behalf, whether directly, derivatively, representatively or in any other capacity, any proceeding in any state or federal court, in or before any administrative agency, or any other proceeding or otherwise alleging or asserting against the Released Parties, individually or collectively, any of the Released Claims in this Final Order and Judgment. The releases herein given by the Released Parties shall be and remain in effect as full and complete releases of the claims set forth in the Actions, notwithstanding the later discovery or existence of any such additional or different facts relative hereto or the later discovery of any such additional or different claims that would fall within the scope of the release provided in this Final Order and Judgment, as if such facts or claims had been known at the time of this release.

22. Plaintiffs, their counsel, and Claims Administrator will ensure that each claims form contains a copy of the releases set forth in paragraphs 11(a) through (c) of the Settlement Agreement. Each member of the Settlement Class or its authorized representative shall sign a claim form that contains a copy of the of the release set forth in paragraphs 11(a) through (c) of the Settlement Agreement as a precondition to receiving any portion of the Settlement Fund. The releases set forth above shall be binding and effective as to all Settlement Class members and each Settlement Class member shall be permanently barred and enjoined from asserting any Released Claims as defined herein.

23. The Settlement is not and shall not be deemed or construed to be an admission, adjudication or evidence of any violation of any statute or law or of any liability or wrongdoing by Defendant or any Released Party or of the truth of any of the claims or allegations alleged in the Actions. The Settlement Agreement, including its exhibits, and any and all negotiations, documents and discussions associated with it, shall be without prejudice to the rights of any party, shall not be deemed or construed to be an admission or evidence of any violation of any statute or law or of any liability or wrongdoing by Defendant, or of the truth of any of the claims or allegations contained in the complaints in the Actions or any other pleading or document, and evidence thereof shall not be discoverable or used directly or indirectly, in any way, whether in the Actions or in any other action or proceeding, except in connection with a dispute under this Settlement or an action in which this Settlement or the releases contained therein is asserted as a defense.

24. All claims in the Actions against GSK are hereby dismissed with prejudice and in their entirety, on the merits, and without costs. This Court shall retain jurisdiction as outlined above in paragraph 19 over the enforcement of the Settlement and Settlement Agreement.

25. The Settlement Agreement shall be binding upon, and inure to the benefit of, the successors and assigns of the parties and to the Released Parties. Without limiting the generality of the foregoing, each and every covenant of and agreement in the Settlement Agreement by the Plaintiffs and their counsel shall be binding on each member of the Settlement Class.

26. Any data or other information provided by Settlement Class members in connection with the submission of claims will be held in strict confidence, available only to the Administrator, class counsel, and experts or consultants acting on behalf of the Settlement Class, and Defendant, Defendant’s counsel, and experts or consultants acting on behalf of Defendant. In no event will a Settlement Class member’s data or information be made publicly available, except as provided for herein or upon Court Order for good cause shown.

27. The Court has reviewed Class Counsel’s petition for an award of attorneys’ fees and reimbursement of expenses. The Court determines that an attorneys’ fee of 33 1/3% of the initial $35 million Settlement Fund (or $11, 655, 000), plus 33 1/3% of any sums that may become part of the Settlement Fund after the calculation provided for in the Plan of Allocation with respect to SHPs, and the reimbursement of $1, 848, 720.15 in expenses, is fair, reasonable, and adequate and that Settlement Class Counsel should be paid said amounts from the Settlement Fund.

28. Each of the five (5) named Plaintiffs are hereby awarded incentive payments as follows: $10, 000 each to Medical Mutual of Ohio, the AFL Plan, the IBEW Plan, Painters District Council, and $5, 000 to Andrea Kehoe for their efforts in representing the Settlement Class, which is in addition to whatever monies these plaintiffs will receive from the Class Settlement Fund pursuant to the Plan of Allocation and the method of distribution approved by the Court. The Court finds these awards to be fair and reasonable.

29. Plaintiffs shall file, not later than February 1, 2014, an accounting for distribution of the disbursement of the Settlement Fund remaining after the payment of claims administration costs and fees, and incentive payments and attorneys’ fees and reimbursement of expenses provided in paragraphs 29 and 30 above. The amounts to be paid pursuant to paragraphs 29 and 30 shall be paid from the Class Settlement Fund.

30. The Court hereby directs that this judgment of dismissal be entered by the clerk forthwith pursuant to Rule 54(b) of the Federal Rules of Civil Procedure. There is no just reason for delay in the entry of this Final Order and Judgment and immediate entry by the Clerk of the Court is expressly directed. The direction of the entry of final judgment pursuant to Rule 54(b) is appropriate and proper because this judgment fully and finally adjudicates the claims of the Plaintiffs and the Settlement Class against Defendants in the Actions, allows consummation of the Settlement, and will expedite the distribution of the Settlement proceeds to Class members.

Exhibit 1

EXHIBIT 1 TO FINAL ORDER AND JUDGMENT EXCLUSION FROM SETTLEMENT CLASS

1. James O. Guleke II, No. 5 Randolph Place, P.O. Box 684091, Austin, Texas 78768


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