Judge gives final approval to billion-dollar Equifax data breach class action settlement

A federal judge in Atlanta has given final approval to a billion-dollar settlement of a class-action lawsuit against Equifax Inc. by consumers damaged by its 2017 data breach.

In orders entered Jan. 13, U.S. District Judge Thomas W. Thrash Jr. granted consumer plaintiffs’ motion for final approval of the proposed settlement and a motion for attorney’s fees, expenses and service awards to class representatives, and dismissed all objections to the settlement.

Lawyers for consumers, which include former Georgia Gov. Roy E. Barnes, filed a motion Dec. 5 requesting final approval of what they called a “historic” settlement which would cost Atlanta-based credit bureau Equifax at least $3.8 billion. That exceeds the value of all previous consumer data breach settlement combined, the lawyers said in their filing.

The settlement class is the approximately 147 million U.S. consumers identified by Equifax whose personal information was compromised as a result of the cyberattack and data breach announced by Equifax on Sept. 7, 2017, according to the final order and judgment.

Equifax will pay $380.5 million into a fund for class benefits, attorneys’ fees, expenses, service awards and notice and administration costs; up to an additional $125 million if needed to satisfy claims for certain out-of-pocket losses; and potentially $2 billion more if all 147 million class members sign up for credit monitoring, according to the order granting approval of the settlement, certification of the class and awarding attorneys’ fees. No settlement funds will revert to Equifax, it said.

According to the order, the specific benefits available to class members include:

– Reimbursement of up to $20,000 for documented, out-of-pocket losses fairly traceable to the breach, such as the cost of freezing or unfreezing a credit file; buying credit monitoring services; out-of-pocket losses from identity theft or fraud, including professional fees and other remedial expenses; and 25 percent of any money paid to Equifax for credit monitoring or identity theft protection subscription products in the year before the breach. If the $380.5 million fund proves to be insufficient, Equifax will add another $125 million to pay claims for out-of-pocket losses.

– Compensation of up to 20 hours at $25 per hour (subject to a $38 million cap) for time spent taking preventative measures or dealing with identity theft. Ten hours can be self-certified, requiring no documentation.

– Four years of specially negotiated, three-bureau credit monitoring and identity protection services through Experian and an additional six years of one-bureau credit monitoring and identity protection services through Equifax. The Experian monitoring has a comparable retail value of $24.99 per month and has a number of features that are typically not available in “free” credit monitoring services offered to the public. The one-bureau credit monitoring shall be provided separately by Equifax and not paid for from the settlement fund.

-Alternative cash compensation (subject to a $31 million cap) for class members who already have credit monitoring or protection services in place and who choose not to enroll in the enhanced credit monitoring and identity protection services offered in the settlement.

-Identity restoration services through Experian to help class members who believe they may have been victims of identity theft for seven years, including access to a U.S.-based call center, assignment of a certified identity theft restoration specialist, and step-by-step assistance in dealing with credit bureaus, companies and government agencies.

Class members have six months to claim benefits (through Jan. 22, 2020), but need not file a claim to access identity restoration services, the order stated.

Equifax agreed to entry of a consent order requiring the company to spend $1 billion for data security and related technology over five years and to comply with comprehensive data security requirements. Equifax’s compliance will be audited by an experienced, independent assessor and subject to the court’s enforcement powers, according to the order and judgment.

With several weeks before the end of the initial claims period, the claims administrator had received in excess of 15 million claims from verified class members, including more than 3.3 million claims for credit monitoring, according to the order. The claims rate, to date, exceeds 10% of the class, it said.

Regarding objections to the settlement, the court noted that only 388 of the approximately 147 million class members directly objected, despite organized efforts to solicit objections. “The objections fail to establish the settlement is anything other than fair, reasonable and adequate,” the order stated.

A Michigan man had filed an objection on behalf of himself and all 147.9 million class members, calling it a “sellout” deal. It was received by the U.S. District Court for the Northern District of Georgia Dec. 5.

About 2,770 people received exclusions from the class, including about 97 from Georgia, according to the final approval order Jan. 13.

The judge approved class counsel’s application for a percentage-based fee of $77.5 million, reimbursement of more than $1.4 million in litigation expenses and service awards of $2,500 for each of 96 settlement class representative, totaling no more than $250,000 in the aggregate, according to the order. In addition to The Barnes Law Group LLC, law firms representing the class include Atlanta-based Doffermyre Shields Canfield & Knowles LLC and Evangelista Worley LLC, Chicago firm DiCello Levitt Gutzler LLC and Kansas City firm Stueve Siegel Hanson LLP. There were eight consumer plaintiffs’ co-liaison counsel as well, including Jason R. Doss of The Doss Firm LLC in Marietta.

Members of the class can file claims through Jan. 22 by going to the settlement website, here.

Read the final order approving the settlement, certifying the class and awarding attorneys fees here. Read the final order and judgment here. Read the consent order entered Jan. 13 here.

By Jessica Saunders  


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