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Garbaccio v. St. Joseph's Hospital and Medical Center

United States District Court, D. New Jersey

March 13, 2017

DONNA GARBACCIO, et al., Plaintiffs,



         This matter has been opened to the Court by: (1) motion of Plaintiff Donna Garbaccio, through her counsel Cohen Milstein Sellers & Toll, LLC (“Cohen Milstein”) and Keller Rohrback, L.L.P. (“Keller Rohrback”) (hereinafter collectively referred to as “Garbaccio's Counsel”), to appoint interim lead plaintiff and interim lead co-counsel [Docket Entry No. 64] and (2) motion of Plaintiffs Mary Lynne Barker, Anne Marie Dalio and Dorothy Flar, through their counsel Kessler Topaz Meltzer & Check, LLP (“KTMC”) (hereinafter collectively referred to as “Barker's Counsel”), to appoint interim co-lead counsel. The Court has not yet certified this action as a class action. Both motions are opposed by the respective Plaintiffs, and unopposed by Defendants St. Joseph's Hospital and Medical Center and Subsidiaries and St. Joseph's Healthcare System, Inc. The Court considers each motion without oral argument pursuant to L. Civ. R. 78.1(b). For the reasons set forth more fully below, the Court recommends that Plaintiff Donna Garbaccio's motion be DENIED in part and GRANTED in part. The Court further recommends that Plaintiff Mary Lynne Barker, Anne Marie Dalio and Dorothy Flar's motion be DENIED.


         Plaintiffs are participants in St. Joseph's Hospital and Medical Center Pension Plan (the “Plan”). Plaintiffs have brought these now consolidated actions against Defendants alleging that the Plan is severely underfunded pursuant to ERISA. The main point of contention between the parties is whether ERISA applies to the Plan. Defendants contend that they are not subject to ERISA because the plan qualifies as a “church plan, ” and is therefore exempt. Plaintiffs disagree, arguing that the Plan is not a “church plan” and therefore subject to ERISA.

         On May 13, 2016, Plaintiff Garbaccio filed her complaint seeking a declaratory judgment that the Plan is not a “church plan” and damages resulting therefrom. Just a few days later, Plaintiffs Barker, Dalio, and Flar filed their complaint seeking similar relief. On July 12, 2016, the Court consolidated both actions on the consent of both parties. [Docket Entry No. 45]. Now before the Court is the parties competing motions to appoint interim lead counsel, and Plaintiff Garbaccio's motion to appoint an interim lead plaintiff.


         Rule 23 of the Federal Rules of Civil Procedure provides that a court “may designate interim counsel to act on behalf of a putative class before determining whether to certify the action as a class action.” Fed.R.Civ.P. 23(g)(3). “Although neither the federal rules nor the Advisory Committee Notes expressly so state, it appears to be generally accepted that the considerations set out in Rule 23(g)(1)(C), which govern the appointment of class counsel once a class is certified, apply equally to the designation of interim class counsel before certification.” Yaeger v. Subaru of America, Inc., No 15-864, 2014 U.S. Dist. LEXIS 182090, at * 1 (D.N.J. Oct. 8, 2014) (quoting In re Air Cargo Shipping Servs. Antitrust Litig., 240 F.R.D. 56, 57 (E.D.N.Y.2006)); Waudby v. Verizon Wireless Services, Inc., 248 F.R.D. 173, 175-76 (D.N.J. 2008) (finding that courts choosing interim class counsel can apply the same factors that apply in choosing class counsel at the time of certification of the class, i.e., the standards set forth in Rule 23(g)(1)).

         The selection of interim lead counsel is “committed to the court's discretion.” See Dutton v. Harris Stratex Networks, Inc., Civ. No. 08-755, 2009 U.S. Dist. LEXIS 48455, at *1 (D. Del. June 5, 2009). The factors to be considered are: (i) the work counsel has done in identifying or investigating potential claims in the action; (ii) counsel's experience in handling class actions, other complex litigation, and the types of claims asserted in the action; (iii) counsel's knowledge of the applicable law; and (iv) the resources counsel will commit to representing the class. Yaeger, 2014 U.S. Dist. LEXIS 182090, 2014 WL 7883689, at *2 (citing Durso v. Samsung Elecs. Am., Inc., 2013 WL 4084640, at *3 (D.N.J. Aug. 7, 2013), Fed.R.Civ.P. 23(g)(1)(A)). The Court must decide which candidate is best qualified, holding dispositive no single factor. Fed.R.Civ.P. 23(g)(2)(B). The Court also has the discretion to appoint more than one firm to act as co-lead counsel. See, e.g., In re Air Cargo Shipping, 240 F.R.D. at 58-59 (appointing four law firms as co-lead counsel); Nowak v. Ford Motor Co., 240 F.R.D. 355 (E.D.Mich.2006) (appointing two law firms as interim co-lead counsel).

         In addition to the mandatory factors enumerated in Rule 23(g)(1)(A), “the Court may also consider any other matter pertinent to counsel's ability to fairly and adequately represent the interests of the class and may, if it deems it necessary, direct the proposed class counsel to provide information on any subject pertinent to the appointment.” In re Terazosin Hydrochloride, 220 F.R.D. 672, 701-02 (S.D. Fla. 2006); see Fed. R. Civ. P. 23(g)(1)(C) (ii)-(iii); Report: Third Circuit Task Force on Selection of Class Counsel, 208 F.R.D. 340, 419-20 (3d Cir. 2002) (citing additional considerations regarding counsel's motivation, experience, and understanding of case and lead plaintiff's economic stake in litigation).

         The Manual for Complex Litigation provides further guidance concerning the propriety of interim class counsel appointment prior to class certification. The Manual states, in part, that:

If the lawyer who filed the suit is to be the only lawyer seeking appointment as class counsel, appointing interim class counsel may be unnecessary. If, however, there are a number of overlapping, duplicative, or competing suits pending in other courts, and some or all of those suits may be consolidated, a number of lawyers may compete for class counsel appointment. In such cases, designation of interm counsel clarifies responsibility for protecting the interest of the class during precertification activities, such as making and responding to motions, conducting any necessary discovery, moving for class certification, and negotiating settlement.

         Manual for Complex Litigation (4th) § 21.11 at *1 (Federal Judicial Center 2004). “[T]hose cases in which interim counsel is appointed are typically those in which a large number of putative class actions have been consolidated or are otherwise pending before a single court.” White v. TransUnion, LLC, 239 F.R.D. 681, 683 (CD. Cal. 2006) (collecting cases).



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