Attached files
file | filename |
---|---|
10-Q - 10-Q Q1 F10 - TORO CO | form_10q.htm |
EX-32 - 906 CERTIFICATION - TORO CO | ex32.htm |
EX-31.A - CEO 302 CERTIFICATION - TORO CO | ex31a.htm |
EX-31.B - CFO 302 CERTIFICATION - TORO CO | ex31b.htm |
EX-10.1 - RESTATED RED IRON PURCHASE AGREEMENT - TORO CO | ex10_2.htm |
Exhibit 99.1
UNITED
STATES DISTRICT COURT
EASTERN
DISTRICT OF WISCONSIN
MILWAUKEE
DIVISION
IN
RE: LAWNMOWER
ENGINE
)
HORSEPOWER
MARKETING
AND ) Case
No. 2:08-md-01999
SALES
PRACTICES
LITIGATION )
) Judge
Lynn Adelman
(This
Document Relates to All
Cases) )
__________________________________________)
STIPULATION
OF SETTLEMENT
This
Stipulation of Settlement dated as of February 24, 2010 (“Stipulation”), is made
and entered into by and among the following Settling Parties to the Actions, as
those terms are defined herein: (i) Proposed Class Representatives,
on behalf of themselves and each of the Settlement Class Members, by and through
Settlement Class Counsel; and (ii) the Settling Defendants, by and through
Settling Defendants’ Counsel. This Stipulation is intended by the
Settling Parties to fully, finally and forever resolve, discharge and settle all
released rights and claims, as set forth below, subject to the terms and
conditions set forth herein.
I. THE
ACTIONS
The
following cases were filed by plaintiffs in, or were removed to, various U.S.
District Courts and were subsequently transferred to the United States District
Court for the Eastern District of Wisconsin for all pretrial purposes pursuant
to transfer orders from the Judicial Panel on Multidistrict
Litigation:
1
Abbreviated
Case Name
|
N.D.
Wisconsin. Case Number
|
Filed
In/Transferred From
|
|
1.
|
Baskerville
v. Sears Roebuck & Co. et al
|
2:08-cv-01057-LA
|
W.D.N.C.
|
2.
|
Luckman
v. Sears Roebuck & Co et al
|
2:08-cv-01058-LA
|
W.D.N.C.
|
3.
|
Phillips
et al v. Sears Roebuck & Co et al
|
2:08-cv-01049-LA
|
S.D.
Ill.
|
4.
|
Gallucci
et al v. Sears Roebuck & Co et al
|
2:08-cv-01059-LA
|
N.D.
Ohio
|
5.
|
Immerman
et al v. Sears Roebuck & Co et al
|
2:08-cv-01060-LA
|
N.D.
Ohio
|
6.
|
Crew
et al v. Sears Roebuck & Co et al
|
2:08-cv-01043-LA
|
M.D.
Ala.
|
7.
|
Fritz
v. Sears Roebuck & Co et al
|
2:08-cv-01054-LA
|
D.N.J.
|
8.
|
Borras
et al v. Sears Roebuck & Co et al
|
2:08-cv-01048-LA
|
S.D.
Fla.
|
9.
|
Hunter
et al v. Sears Roebuck & Co et al
|
2:08-cv-01053-LA
|
D.
Neb.
|
10.
|
Purce
v. Sears Roebuck & Co et al
|
2:08-cv-01050-LA
|
D.
Md.
|
11.
|
Moore
et al v. Sears Roebuck & Co et al
|
2:08-cv-01051-LA
|
D.
Minn.
|
12.
|
Phillips
v. Sears Roebuck & Co et al
|
2:08-cv-01045-LA
|
N.D.
Cal.
|
13.
|
Marvilla
v. Sears Roebuck & Co et al
|
2:08-cv-01046-LA
|
N.D.
Cal.
|
14.
|
Wright
v. Sears Roebuck & Co et al
|
2:08-cv-01044-LA
|
M.D.
Ala.
|
15.
|
Kaitfors
et al v. Sears Roebuck & Co et al
|
2:08-cv-01062-LA
|
D.S.D.
|
16.
|
Day
v. Sears Roebuck & Co et al
|
2:08-cv-01047-LA
|
M.D.
Fla.
|
17.
|
Champion
et al v. Sears Roebuck & Co et al
|
2:08-cv-01063-LA
|
E.D.
Tenn.
|
18.
|
Hinrichs
v. Sears Roebuck & Co et al
|
2:08-cv-01055-LA
|
E.D.N.Y.
|
19.
|
Doppler
et al v. Sears Roebuck & Co et al
|
2:08-cv-01052-LA
|
D.
Mont.
|
20.
|
Tshudy
et al v. Sears Roebuck & Co et al
|
2:08-cv-01061-LA
|
E.D.
Pa.
|
21.
|
Bennett
et al v. Sears Roebuck & Co et al
|
2:08-cv-01064-LA
|
E.D.
Tex.
|
22.
|
Hoeker
v. Sears Roebuck & Co et al
|
2:08-cv-01065-LA
|
E.D.
Tex.
|
23.
|
Brey
et al v. Sears Roebuck & Co et al
|
2:09-cv-00002-LA
|
D.
Ariz.
|
2
24.
|
Bowen
et al v. Sears Roebuck & Co et al
|
2:08-cv-01056-LA
|
S.D.N.Y.
|
25.
|
Skelton
v. Sears Roebuck & Co et al
|
2:09-cv-00012-LA
|
M.D.
Pa.
|
26.
|
Dale
et al v. Sears Roebuck & Co et al
|
2:09-cv-00009-LA
|
E.D.
Mo.
|
27.
|
Barnard
et al v. Sears Roebuck & Co et al
|
2:09-cv-00016-LA
|
W.D.
Wis.
|
28.
|
Michel
et al v. Sears Roebuck & Co et al
|
2:09-cv-00015-LA
|
W.D.
Wash.
|
29.
|
Whitehouse
v. Sears Roebuck & Co et al
|
2:09-cv-00011-LA
|
N.D.
Okla.
|
30.
|
Murphy
v. Sears Roebuck & Co et al
|
2:09-cv-00004-LA
|
D.
Id.
|
31.
|
Bullis
et al v. Sears Roebuck & Co et al
|
2:09-cv-00003-LA
|
D.
Colo.
|
32.
|
Doppler
et al v. Sears Roebuck & Co et al
|
2:09-cv-00010-LA
|
D.N.D.
|
33.
|
Becnel
v. Sunshine Equipment Co et al
|
2:09-cv-00005-LA
|
E.D.
La.
|
34.
|
Jones
et al v. Sears Roebuck & Co et al
|
2:09-cv-00008-LA
|
E.D.
Mich.
|
35.
|
Rachal
v. Sears Roebuck & Co et al
|
2:09-cv-00006-LA
|
E.D.
La.
|
36
|
Ramos
v. Sears Roebuck & Co et al
|
2:09-cv-00013-LA
|
E.D.
Tenn.
|
37.
|
Jacome
et al v. Sears Roebuck & Co et al
|
2:09-cv-00001-LA
|
N.D.
Ala.
|
38.
|
Dahnke
et al v. Sears Roebuck & Co et al
|
2:09-cv-00058-LA
|
S.D.
Ind.
|
39.
|
Heidi
RS Dallal v. Sears Roebuck & Co et al
|
2:09-cv-00007-LA
|
D.
Mass.
|
40.
|
O'Roark
v. Sears Roebuck & Co et al
|
2:09-cv-00056-LA
|
W.D.
Ark.
|
41.
|
Dolan-Keenan
v. Sears Roebuck & Co et al
|
2:09-cv-00057-LA
|
D.
Del.
|
42.
|
Catton
et al v. Sears Roebuck and Company et al
|
2:09-cv-00157-LA
|
M.D.
Ga.
|
43.
|
Lee
v. Sears Roebuck & Co et al
|
2:09-cv-00197-LA
|
D.S.C.
|
44.
|
Lilly
v. Sears Roebuck & Co et al
|
2:09-cv-00199-LA
|
S.D.W.V.
|
45.
|
Marcus
et al v. Sears Roebuck & Co
|
2:09-cv-00200-LA
|
D.
Wy.
|
3
46.
|
Edel
et al v Sears Roebuck & Co et al
|
2:09-cv-00158-LA
|
N.D.
Iowa
|
47.
|
Schneider
et al v. Sears Roebuck & Co et al
|
2:09-cv-00156-LA
|
D.
Conn.
|
48.
|
Wilson
v. Sears Roebuck & Co et al
|
2:09-cv-00160-LA
|
D.
Me.
|
49.
|
Christy
et al v. Sears Roebuck & Co et al
|
2:09-cv-00161-LA
|
D.
Nev.
|
50.
|
Crawford
v. Sears Roebuck & Co et al
|
2:09-cv-00162-LA
|
N.D.
Ohio
|
51.
|
Horrocks
v. Sears Roebuck & Co et al
|
2:09-cv-00164-LA
|
D.R.I.
|
52.
|
Keizer
et al v. Sears Roebuck & Co et al
|
2:09-cv-00195-LA
|
E.D.
Ky.
|
53.
|
Williams
v. Sears Roebuck & Co et al
|
2:09-cv-00163-LA
|
D.P.R.
|
54.
|
Paulson
v. Sears Roebuck & Co et al
|
2:09-cv-00198-LA
|
D.
Utah
|
55.
|
Armstrong
et al v. Sears Roebuck & Co et al
|
2:09-cv-00165-LA
|
D.
Vt.
|
56.
|
Kruchoski
v. Sears Roebuck & Co et al
|
2:09-cv-00191-LA
|
D.
Alaska
|
57.
|
Lynch
et al v. Sears Roebuck & Co et al
|
2:09-cv-00192-LA
|
M.D.
Ala.
|
58.
|
Doherty
et al v. Sears Roebuck & Co et al
|
2:09-cv-00159-LA
|
D.
Kan.
|
59.
|
Bishara
v. Sears Roebuck & Co et al
|
2:09-cv-00193-LA
|
E.D.
Ark.
|
60.
|
Kunesh
v. Sears Roebuck & Co et al
|
2:09-cv-00196-LA
|
D.N.H.
|
61.
|
Gonzalez
v. Sears Roebuck & Co et al
|
2:09-cv-00194-LA
|
D.D.C.
|
62.
|
Kolka
v. Deere & Company
|
2:09-cv-00266-LA
|
N.D.
Ill.
|
63.
|
Slater
v. Sears Roebuck & Co et al
|
2:09-cv-00267-LA
|
S.D.
Miss.
|
64.
|
Grosz
et al v. Sears Roebuck & Co et al
|
2:09-cv-00014-LA
|
E.D.
Va.
|
65.
|
Williams
v. Sears Roebuck & Co. et al
|
2:09-cv-00607-LA
|
D.
Ore.
|
The above
listed cases have been coordinated for all pretrial purposes by and through the
Practice and Procedure Order Upon Transfer Under 28 U.S.C. § 1407(a), entered by
the Court on December 23, 2008. Settlement Class Counsel has also
filed the following three related actions
4
in the
United States District Court for the Eastern District of
Wisconsin: Azzara v. Sears Roebuck & Co. et al., Case No.
2:09-cv-0728-LA (E.D. Wis. July 24, 2009), Thomas v. Sears Roebuck & Co. et
al., Case No. 2:09-cv-0729-LA (E.D. Wis. July 24, 2009), and Martinez v. Sears,
Roebuck & Co. et al., Case No. 2:09-cv-0469-LA (E.D. Wis. May 7, 2009) (the
“Related Actions”). Finally, Settlement Class Counsel has filed in
Illinois state court Lemay v. Sears Roebuck & Co. et al., Case No. 08-L85
(St. Clair Cty., Ill.) (the “Lemay Action”).
II. SETTLING
DEFENDANTS DENY ANY WRONGDOING OR LIABILITY
Settling
Defendants have denied, and continue to deny, each and every claim and
allegation of wrongdoing that has been alleged by the plaintiffs in the
Actions. Settling Defendants also have denied, and continue to deny,
inter alia, any and all allegations that plaintiffs or Settlement Class Members
have suffered any damage whatsoever, have been harmed in any way, or are
entitled to any relief as a result of any conduct on the part of Settling
Defendants as alleged by plaintiffs in the Actions.
Nevertheless,
Settling Defendants have concluded that further litigation will likely be
protracted and expensive with uncertain results, that settlement of the Actions
is therefore advisable to permit the operation of the Settling Defendants’
businesses without further litigation expenses and the distraction of executive
personnel, and that it is therefore desirable and prudent that the Actions
between Proposed Class Representatives, Settlement Class Members, and Settling
Defendants be fully and finally resolved and settled in the manner and upon the
terms and conditions set forth in this Stipulation.
III. BENEFITS
OF SETTLING THE ACTIONS
Plaintiffs believe that the claims
asserted by them in the Actions have merit and that there is evidence to support
their claims. Plaintiffs, however, recognize and acknowledge the
expense
5
and
length of continued litigation and legal proceedings necessary to prosecute the
Actions against Settling Defendants through trial and through any
appeals. Plaintiffs also recognize and have taken into account the
uncertain outcome and risks associated with litigation and class actions in
general, and the Actions in particular, as well as the difficulties and delays
inherent in any such litigation.
Plaintiffs are also mindful of the
potential problems of proof and the possible defenses to class certification and
to the unlawful conduct alleged by them in the Actions, as well as to the
remedies they seek. As a result, plaintiffs believe that the Settlement set
forth in this Stipulation provides substantial benefits to Settlement Class
Members. Plaintiffs and Settlement Class Counsel have therefore
determined that the Settlement, as set forth in this Stipulation, is fair,
reasonable, adequate and in the best interests of the Settlement
Class.
IV. TERMS
OF THE SETTLEMENT
NOW, THEREFORE, IT IS HEREBY STIPULATED
AND AGREED to, by and among the Proposed Class Representatives (for themselves
and all Settlement Class Members) and the Settling Defendants, for themselves,
by and through their respective counsel of record, that the Actions shall be
finally and fully compromised, settled and released, the Actions shall be
dismissed with prejudice as to all Released Parties, and that all the claims of
the Proposed Class Representatives and the Settlement Class Members shall be
released, subject to the terms and conditions of this Stipulation, and subject
to the Final Approval Order approving the Stipulation becoming Final as defined
herein.
1.
|
Definitions
|
As used
in this Stipulation, the following terms shall have the following definitions
and meanings:
6
1.1 “Actions” means the 65 MDL
Actions, the 3 Related Actions, and the Lemay Action.
1.2 “Claims Administrator” means
Rust Consulting or such other entity agreed by the Settling Parties and
authorized by the Court to process claims and to undertake other tasks as set
forth in this Stipulation.
1.3 “Court” means the United
States District Court for the Eastern District of Wisconsin.
1.4 “Defendant” means any person
or entity named as a defendant in any Action or any Subsequent
Action.
1.5 “Depository Bank” means the
financial institution holding the Escrow Funds in the Escrow Account, or its
successor.
1.6 “Escrow Account” means the escrow
account established pursuant to this Settlement.
1.7 “Escrow Agent” means the financial
institution selected by Settlement Class Counsel and approved by Settling
Defendants to hold the Settlement Fund.
1.8 “Escrow Agreement” means the
escrow agreement executed by the Escrow Agent and Settling Parties,
substantially in the form attached as Exhibit 1.
1.9 “Escrow Funds” means the funds
in the Escrow Account.
1.10 “Final” means when the last of
the following with respect to the Final Approval Order approving the Stipulation
has occurred: (i) the expiration of three (3) business days after the time to
file a motion to alter or amend the Final Approval Order under Federal Rule of
Civil Procedure 59(e) has passed without any such motion having been filed; (ii)
the expiration of three (3) business days after the time in which to appeal
the
7
Final
Approval Order has passed without any appeal having been filed; and (iii) if
such motion to alter or amend is filed, or if an appeal is taken, three (3)
business days after a determination of any such motion or appeal that permits
the consummation of the Settlement in substantial accordance with the terms and
conditions of this Stipulation.
1.11 “Final Approval” means the approval
of the Stipulation and Settlement by the Court at or after the Final Fairness
Hearing, and entry of the Final Approval Order.
1.12 “Final Approval Order” means the order
entered by the Court giving Final Approval of the Stipulation and dismissing
claims.
1.13 “Final Fairness Hearing” means the hearing at
which the Stipulation and the Final Approval Order are presented by the Settling
Parties for Final Approval and entry by the Court.
1.14 “Injunctive Relief” means the
relief provided in Section V.11 hereof.
1.15 “Interim Co-Lead Class
Counsel” or “Settlement
Class Counsel” means the law firms of Heins Mills & Olson, P.L.C.,
310 Clifton Avenue, Minneapolis, MN 55403; and Morrison Fenske & Sund, P.A.,
5125 Country Road 101, Suite 202, Minnetonka, MN 55345.
1.16 “Lemay Action” means Lemay v.
Sears Roebuck & Co. et al. now pending in Illinois state court.
1.17 “MDL Actions” means MDL
2:08-md-0199 including cases identified in Section I of this Stipulation and all
cases transferred or pending transfer through the date the Final Approval Order
becomes Final.
1.18 “Net Settlement Fund” means the amount
remaining in the Settlement Fund for distribution to authorized claimant
Settlement Class Members, after payment of or
8
reserve
for escrow expenses, taxes on escrow earnings or tax-related fees and expenses,
estimated taxes, notice costs, settlement administration expenses, all other
related costs, incentive awards to Proposed Class Representatives and such
attorneys’ fees and litigation expenses as may be awarded by the
Court.
1.19 “Notice” means the form of
Notice to be provided to Settlement Class Members, as approved by the
Court.
1.20 “Notice Administrator” means
Kinsella Media or such other entity agreed by the parties and authorized by the
Court to provide notice and to undertake other tasks as set forth in this
Stipulation.
1.21 “Notice Plan” shall mean the
plan for disseminating notice to Settlement Class Members, as approved by the
Court.
1.22 “Opt-Out” means a Settlement
Class Member who timely elects to opt-out of the Settlement in the manner
prescribed by the Court.
1.23 “Plaintiffs’ Counsel” means the attorneys
and law firms listed on the complaints in the Actions.
1.24 “Plaintiffs’ Related Parties”
means each of a Settlement Class Member’s estates, heirs, executors, guardians,
conservators and trustees.
1.25 “Preliminary Approval” means
the preliminary approval of the Stipulation by the Court, conditional
certification of the Settlement Class, and approval of the method and content of
the Notice and Notice Plan.
1.26 “Proposed Class
Representatives” means all plaintiffs proposed in the Preliminary and
Final Approval Orders by Settlement Class Counsel as representatives of the
proposed Settlement Class.
9
1.27 “Related Actions” means
Azzara v. Sears Roebuck & Co. et al., Thomas v. Sears Roebuck & Co. et
al., and Martinez v. Sears, Roebuck & Co. et al. now pending before the
United States District Court for the Eastern District of Wisconsin.
1.28 “Released Claims” shall have
the meaning set forth in Sections VII.1. and 2., and as excluded by Section
VII.3. herein.
1.29 “Released Parties” means Sears, Roebuck
and Co., Sears Holdings Corporation, Kmart Holding Corporation, Deere &
Company, Tecumseh Products Company, TecumsehPower Company, Platinum Equity, LLC,
Briggs & Stratton Corporation, The Toro Company, Electrolux Home Products,
Inc., Husqvarna Outdoor Products, Inc. (now known as Husqvarna Consumer Outdoor
Products, N.A., Inc.), and Husqvarna AB and each of their past or present
officers, directors, partners, agents, employees, shareholders, attorneys,
accountants or auditors, consultants, legal representatives, predecessors,
successors, assigns, parents, subsidiaries, divisions, joint ventures,
affiliated entities, and any entity that controls, is controlled by, or is under
common control with any of the named companies. No other Defendant is
a Released Party.
1.30 “Releasing Party” or “Releasing Parties” means the Proposed
Class Representatives and any Settlement Class Member who is not an
Opt-Out.
1.31 “Settlement” means the
settlement entered into by the Settling Parties as set forth in this
Stipulation, and as may be amended by the Settling Parties as provided for
herein.
1.32 “Settlement Amount” means
$51,000,000.
1.33 “Settlement Class” means the
class certified for settlement purposes only which shall
be:
10
All
persons or entities in the United States who, beginning January 1, 1994 up to
and including the date when Notice of the Court’s entry of an order
preliminarily approving this Settlement and certifying the Settlement Class is
first published, purchased, for their own use and not for resale, a lawn mower
containing a gas combustible engine up to 30 horsepower provided that either the
lawn mower or the engine of the lawn mower was manufactured or sold by a
Defendant.
Excluded
from the Settlement Class are (i) each Defendant, any entity in which a
Defendant has a controlling interest or which has a controlling interest in any
Defendant, and Defendants’ legal representatives, predecessors, successors and
assigns; (ii) governmental entities; (iii) Defendants’ employees, officers,
directors, agents, and representatives and their family members; and (iv) the
judges in the Actions and their staff to whom the Actions have been assigned,
and any member of the judges’ immediate families.
1.34 “Settlement Class Member”
means any person falling within the definition of the Settlement Class defined
in Section IV.1.33 herein (collectively referred to herein as “Settlement Class
Members”).
1.35 “Settlement Fund” means the
payments made by the Settling Defendants pursuant to Section V.1 herein and any
interest or other amount earned or accrued on such payments, less escrow
expenses, taxes on escrow earnings, estimated taxes, and tax-related fees and
expenses, all of which shall be paid from the Settlement Amount.
1.36 “Settling Defendants”
means: (i) Sears, Roebuck and Co., Sears Holdings Corporation,
and Kmart Holding Corporation (“Sears”); (ii) Deere & Company (“Deere”);
(iii) Tecumseh Products Company, (“Tecumseh”); (iv) Briggs & Stratton
Corporation (“Briggs & Stratton”); (v) The Toro Company (“Toro”); and (vi)
Electrolux Home Products,
11
Inc., and
Husqvarna Outdoor Products, Inc. (now known as Husqvarna Consumer Outdoor
Products, N.A., Inc.) (“EHP”).
1.37 “Settling Defendants’ Counsel”
means counsel of record for Settling Defendants.
1.38 “Settling Engine Manufacturer
Defendants” means Briggs & Stratton, Toro, and Tecumseh.
1.39
“Settling Parties” means, collectively,
each of the Settling Defendants and each of the Proposed Class Representatives
on behalf of themselves and all Settlement Class Members, by and through
Settlement Class Counsel.
1.40 “Stipulation” means this
Stipulation of Settlement, as may be amended by the Settling Parties as provided
for herein.
1.41 “Subsequent Action” means any
action brought in any state or federal court advancing any claims involving or
relating to the horsepower or other power rating, or the labeling, marketing, or
advertising of the horsepower or other power rating, of lawn mowers or lawn
mower engines under any theory of liability, by, or on behalf of, any member of
the Settlement Class.
1.42 “Subsequent Court” means a
court in which a Subsequent Action, as defined above in Section IV.1.41, is
brought.
1.43 “United States” means the
fifty states of the United States, the District of Columbia and Puerto
Rico.
1.44 “Warranty Relief” means the
relief being provided by Settling Engine Manufacturer Defendants pursuant to
Section V.10. herein.
V. TERMS
OF THE SETTLEMENT
12
1. Consideration. Subject
to the provisions herein, and in full, complete and final settlement of the
Actions with respect to the Released Parties as provided herein, the Settling
Parties agree that: (a) each Settling Defendant will pay its
respective portion of the Settlement Amount, as separately agreed by the
Settling Parties; (b) each Settling Engine Manufacturer Defendant will provide
the Warranty Relief as set forth in Section V.10. hereof, and (c) each Settling
Defendant consents to the Injunctive Relief as set forth in Section V.11.
hereof. Each Settling Defendant shall pay 25% of its respective
portion of the Settlement Amount by wire transfer to the Escrow Account at the
Depository Bank within 5 business days after the execution of the Settlement
Agreement by the Settling Defendants and receipt of a completed IRS Form W-9
executed by the Escrow Agent on behalf of the “qualified settlement fund”
described in Sections V.4-6 below and wire transfer
instructions. Within 5 business days after Preliminary Approval of
this Settlement Agreement and the commencement of notice to the Settlement
Class, but no earlier than March 15, 2010, each Settling Defendant shall pay 25%
of its respective portion of the Settlement Amount by wire transfer to the
Escrow Account at the Depository Bank. Within 5 business days after
the Final Approval Order becomes Final, each Settling Defendant shall pay the
remaining 50% of
its respective portion of the Settlement Amount by wire transfer to the Escrow
Account at the Depository Bank and shall fully relinquish any and all control
of, or interest in, the Settlement Fund. If Preliminary Approval or
Final Approval is not achieved, or the Final Approval Order does not become
Final, the Settling Defendants and Settlement Class Counsel shall immediately
direct the Escrow Agent to transfer the Net Settlement Fund back to the Settling
Defendants in accordance with the amounts paid, pro rata, by each Settling
Defendant, at which time the Plaintiffs, Settlement Class, and Settlement Class
Counsel agree
13
and
acknowledge that in such event they, and each of them, fully relinquish any and
all control of, or interest in, the Settlement Fund, and this Agreement shall
become null and void.
2. Escrow
Account. The Escrow Account shall be established at the
Depository Bank and administered by the Escrow Agent under the Court’s
continuing supervision and control pursuant to the Escrow Agreement executed by
the Escrow Agent and Settling Parties.
3. Jurisdiction of
Court. All Settlement Funds transmitted to and held by the
Escrow Agent as required by this Stipulation shall be deemed and considered to
be in custodia legis of the Court, and shall remain subject to the jurisdiction
of the Court, until such time as all Settlement Funds have been completely
distributed pursuant to the terms of the Stipulation, and/or any further
order(s) of the Court.
4. Settlement Fund Tax
Status. Settling Parties agree to treat the Settlement Fund as
being at all times a “qualified settlement fund” within the meaning of Treas.
Reg. § 1.468B1 (or any successor regulation). In addition, the Escrow Agent
shall timely make such elections as necessary or advisable to carry out the
provisions of this paragraph, including the “relation-back election” (as defined
in Treas. Reg. § 1.468B-1) (or any successor regulation) back to the earliest
permitted date. Such elections shall be made in compliance with the procedures
and requirements contained in such regulations. It shall be the responsibility
of the Escrow Agent to timely and properly prepare and deliver the necessary
documentation for signature by all necessary parties, and thereafter to cause
the appropriate filing to occur.
5. Tax
Returns. For the purpose of Treas. Reg. § 1.468B (or any
successor regulation) of the Internal Revenue Code of 1986, as amended, and the
regulations promulgated there under, the “administrator” shall be the Escrow
Agent. The Escrow Agent shall timely and properly file all informational and
other tax returns necessary or advisable with respect to the
14
Settlement
Fund (including, without limitation, the returns described in Treas. Reg. §
1.468B-2(k)) (or any successor regulation). Such returns (as well as the
election described in Section V.4 above) shall be consistent with this
subsection and in all events shall reflect that all taxes (including any
estimated taxes, interest or penalties) on the income earned by the Settlement
Fund shall be paid out of the Settlement Fund as provided in Section V.6
hereof.
6. Tax
Payments. All (a) taxes (including any estimated taxes,
interest or penalties) arising with respect to the income earned by the
Settlement Fund, including any taxes or tax detriments that may be imposed upon
Settling Defendants with respect to any income earned by the Settlement Fund for
any period during which the Settlement Fund does not qualify as a “qualified
settlement fund” for federal or state income tax purposes, and (b) expenses and
costs incurred in connection with the operation and implementation of this
paragraph (including, without limitation, expenses of tax attorneys and/or
accountants and mailing and distribution costs and expenses relating to filing
(or failing to file) the returns described in Section V.5) shall be paid out of
the Settlement Fund. In no event shall Settling Defendants have any
responsibility for or liability with respect to the taxes or tax related
expenses. The Escrow Agent shall indemnify and hold Settling Defendants harmless
for taxes and tax related expenses (including, without limitation, taxes payable
by reason of any such indemnification). Further, taxes and tax related expenses
shall be treated as, and considered to be, a cost of administration of the
Settlement Fund and shall be timely paid by the Escrow Agent out of the
Settlement Fund without prior order from the Court, and the Escrow Agent shall
be obligated (notwithstanding anything herein to the contrary) to withhold from
distribution any funds necessary to pay such amounts, including the
establishment of adequate reserves for any taxes and tax related expenses (as
well as any amounts that may be required to be withheld under Treas. Reg. §
1.468B2(1)(2)) (or any
15
successor
regulation); Settling Defendants are not responsible therefore nor shall they
have any liability with respect thereto. The Settling Parties hereto agree to
cooperate with the Escrow Agent, each other, and their tax attorneys and
accountants to the extent reasonably necessary to carry out the provisions of
this section.
7. Notice
Procedures. The Settling Parties agree to follow the notice
procedures specified in the Notice Plan, as approved by the Court.
8. Expenses of Notice and
Administration. Settling Defendants shall have no
responsibility for the expense of notice to the Settlement Class pursuant to the
Notice Plan or the expense of administration of the Settlement
Fund. Expenses of notice and administration for this Settlement shall
be invoiced by the Notice Administrator and the Claims Administrator,
respectively, and can be paid from this Settlement Fund. In no event
shall the total expenses associated with notice and administration increase the
amount owed by Settling Defendants as part of the Settlement. In no
event shall the Settlement Class Counsel be responsible for the expense of
notice to the Settlement Class.
9. Plan of Distribution of the
Net Settlement Fund. Subject to approval by the Court, the
Settling Parties agree to the following distribution of the Net Settlement
Fund.
a. Each
Settlement Class Member who is not an Opt-Out and submits a valid and timely
claim to the Claims Administrator shall receive up to $35.00, if the claim is
for a walk-behind lawn mower purchased by the Settlement Class Member; or up to
$75.00, if the claim is for a riding lawn mower purchased by the Settlement
Class Member.
b. For
a claim to be valid, a Settlement Class Member must submit a claim form with the
information set forth in this Section V.9.b. to the Claims
Administrator
16
within
the Monetary Relief Claims Period (as defined in the Notice) via the Internet or
by mail. The Claims Administrator shall maintain a website and a toll
free telephone number through which Settlement Class Members may obtain and
submit claim forms. The claim form will request that a Settlement
Class Member submit his or her full name, current address, and the brand of the
lawnmower, brand of the engine, the engine model number, and the lawnmower
identification number for the lawnmower for which a claim is being
submitted. To the extent that a Settlement Class Member submits a
claim form without some of the information listed in the preceding sentence, if
the Claims Administrator is able to ascertain the missing information from the
information provided by the Settlement Class Member sufficient to establish that
it is a valid claim, the Claims Administrator may deem the claim as valid for
purposes of receiving a distribution from the Net Settlement
Fund. The claim form shall further require that the Settlement Class
Member affirm under oath that all of the information on the claim form is true
and correct and that between January 1, 1994 and the date of the Notice he or
she purchased, for his or her use and not for resale, the lawnmower for which a
claim is being submitted.
c. If
the aggregate amount of valid claims received by the Claims Administrator
exceeds the Net Settlement Fund, the amount each claimant receives under Section
V.9.a. shall be reduced pro rata by the percentage necessary to permit payment
of all valid claims. Any portion of the Net Settlement Fund not
distributed to Settlement Class Members shall be disposed of pursuant to an
order of the Court. In any event, upon the Final Approval Order
becoming Final, no part of the Settlement Fund or Net Settlement Fund shall
revert to the Settling Defendants.
17
d. Any
order of the Court requiring modification of the distribution of the Net
Settlement Fund as set forth in Section V.9 shall not affect the approval or
finality of this Settlement. Except as provided by order of the Court
pursuant to this Settlement Agreement, including an order approving a plan of
distribution, no Settlement Class Member shall have any interest in the
Settlement Fund or any portion thereof.
10. Warranty
Relief. Each Settling Engine Manufacturer Defendant agrees to
make available to each Settlement Class Member who is not an Opt-Out and who
purchased a lawnmower with an engine manufactured and warranted by such Settling
Engine Manufacturer Defendant, a warranty extension of one-year on such engine
warranty (“Warranty Relief”). Briggs & Stratton shall provide the
Warranty Relief only for engines both manufactured and warranted by Briggs &
Stratton. Toro shall provide the Warranty Relief only for engines
both manufactured and warranted by Toro. Tecumseh shall provide the
Warranty Relief only for engines both manufactured and warranted by
Tecumseh. For purposes of Warranty Relief only, engines manufactured
and warranted by Tecumseh Power Company shall be treated as if they were
manufactured and warranted by Tecumseh.
a. With
respect to engine warranties issued by the Settling Engine Manufacturer
Defendants that are still in effect when the Final Approval Order becomes Final,
such Warranty Relief will add one year to the engine warranties. For
all warranty extensions, the terms of the extended warranty (other than its
duration), including all exclusions, shall be the same as the Settling Engine
Manufacturer Defendant’s warranty that is in effect when the Final Approval
Order becomes Final.
b. With
respect to engine warranties issued by the Settling Engine Manufacturer
Defendants that expired prior to the Final Approval Order becoming
Final,
18
such
Warranty Relief will provide a one-year warranty commencing on the date the
Final Approval Order becomes Final. For all such extended warranties,
the terms of the extended warranty (other than its duration), including all
exclusions, shall be the same as the Settling Engine Manufacturer Defendant’s
most recent engine warranty as of the date of this Settlement
Agreement.
c. Settlement
Class Members have up to one year from the date that the Final Approval Order
becomes Final to make a claim for and to obtain the benefits of the Warranty
Relief described in this Section V.10 (the “Warranty Relief Claims
Period”). Upon a Settlement Class Member’s submission of a claim form
within the Warranty Relief Claims Period and containing the information set
forth in Section V.9.b. for a lawnmower containing an engine manufactured and
warranted by a Settling Engine Manufacturer Defendant and requesting an extended
warranty, the Settlement Class Member shall receive a certificate evidencing the
Warranty Relief as to the Settlement Class Member’s lawn mower engine(s)
identified on the claim form. Settlement Class Members who submit a
claim form within the Warranty Relief Claims Period but after the Monetary
Relief Claims Period has expired shall not be entitled to share in any
distribution of the Net Settlement Fund.
d. To
obtain the benefits of the Warranty Relief, a Class Member must present the
certificate to a facility authorized to service the engine in issue, along with
the lawnmower and engine identified in the certificate within one year after the
Final Approval Order becomes Final and the engine failure must meet the terms
and conditions of the warranty issued by the applicable Settling Engine
Manufacturer Defendant.
19
e. To
the extent any additional settlements are made with non-settling Defendants in
the Actions, Settlement Class Counsel will use its best efforts to obtain the
agreement of each Defendant that is not a Settling Defendant to provide an
extended warranty to Class Members who purchased that Defendant’s lawnmowers or
lawnmower engines on terms substantially the same as the Warranty
Relief.
11. Injunctive
Relief. The Settling Defendants agree to the following
governing future horsepower testing and labeling of lawnmower engines
(“Injunctive Relief”).
a. Engine
and Lawnmower Power Rating: If any engine is
given a horsepower rating or a torque rating displayed either on the engine or
the lawnmower, or in any written materials intended to accompany the engine or
the lawnmower at the time of retail sale to a consumer, the engine rating must
be in compliance with this Injunctive Relief and all SAE testing and labeling
standards, and identify: 1) the displacement (in cubic centimeters) of the
engine; and 2) the “Certified Power Rating” as defined below. The
party that is testing the engine and obtaining the Certified Power Rating
(whether engine manufacturer or OEM) shall be responsible for compliance with
these injunctive relief requirements.
b. Requirements
to Obtain a “Certified Power Rating” for Lawnmower Engines: The “Certified
Power Rating” is the power rating performed in accordance with the testing and
labeling standards of the SAE and pursuant to this injunctive relief as
certified by a “Certified Engine Tester.” A “Certified Engine Tester”
is an independent testing entity or person who is not employed by any engine
manufacturer, lawn mower manufacturer or other defendant in this
litigation. All Certified Engine Testers shall be
20
either a
United States resident, subject to service of process within the United States,
or consent to service of process at a designated location.
(1) Equipment
Calibration: Engine testing equipment, (e.g., dynamometers and
any other measuring devices) must be calibrated within 90 days prior to the
tests. The Certified Engine Tester shall certify the calibration test
performed and that the testing equipment meets the specifications of the testing
standard.
(2) Testing
Standards: All gross horsepower or torque tests will be
conducted in accordance with SAE J1995. All net horsepower or torque
tests will be conducted in accordance with SAE J1349.
(3) Test
Locations: All engine testing will be performed at the engine
manufacturer’s production locations, the OEM’s production locations if the OEM
is testing and certifying the engine, or such other appropriately equipped
testing location.
(4) Manufacturer
Testing: All engine testing will be performed by, or on behalf
of, the engine manufacturer or OEM (if the OEM is testing and certifying the
engine).
(5) Engine Selection &
Retention: Engines will be selected, at random, by the engine
manufacturer from existing stock for existing engine models or from
pre-production stock for new engine models. At least one engine used
in the testing that support test results will be retained by engine manufacturer
for as long as the test results are relied on by the engine
manufacturer.
21
(6) Test
Certification: A Certified Engine Tester shall personally
conduct and certify, or personally witness and certify, with respect to the
results of the engine testing that:
|
·
|
the
testing equipment met the specifications of the relevant testing standard
and were properly calibrated;
|
|
·
|
the
results of the tests on each engine were achieved in compliance with the
relevant SAE testing standards;
|
|
·
|
the
engines tested were selected at random from existing stock (in the case of
existing engine models) or from pre-production stock not prototypes (in
the case of new engine models).
|
|
·
|
sufficient
engines were tested to establish a 95% confidence interval using well
founded statistical methods as to the power achieved under the relevant
SAE testing standard.
|
(7) Frequency in Obtaining a
Certified Power Rating: A Certified Power Rating is required
one time only for each engine model. If the manufacturer alters the
manufacturing process or if any changes are made to an engine that changes the
engine horsepower or torque from the previously certified rating, that engine
must be subjected to testing to obtain a new Certified Power
Rating.
(8) Publishing Test
Results: Certified Power Rating test results (e.g., power
curves used to establish a 95% confidence interval for a given engine) will be
publicly available on either the Outdoor Power Equipment Institute website or
the engine manufacturer’s website within 30 days after Certified Power
Rating
22
results. The
written materials intended to accompany the engine or the lawnmower at the time
of retail sale must contain information sufficient to identify where a consumer
can view the Certified Power Rating Test Results.
(9) Timing: The
Settling Defendants shall have a period of twelve (12) months from the date the
Final Approval Order becomes Final to comply with this injunctive
relief. This injunctive relief will be effective for a period of ten
(10) years from the date the Final Approval Order becomes Final.
(10) Proposed Revisions to SAE
J1995: Settling Defendants who are in the business of manufacturing
lawnmowers or lawnmower engines or become involved in the business of
manufacturing lawnmowers or lawnmower engines during the period in which the
Injunctive Relief is in effect agree to use their best good faith efforts to
amend SAE J1995 to reflect the red-lined changes set forth in Exhibit 2 attached
hereto. There is no requirement that the proposed changes actually be
adopted by the SAE for Settling Defendants to fulfill their duty pursuant to
this Injunctive Relief to present the amendments. All horsepower
rating or torque rating displayed by Settling Defendants either on the engine of
the lawnmower or in any written materials intended to accompany the engine or
lawnmower shall be in compliance with SAE standards.
Notwithstanding
the foregoing, nothing in this Stipulation shall be construed as requiring Sears
to test or label engines. Sears only is agreeing that the lawnmowers
it sells will comply with the requirements set forth in this Section
V.11. To the extent any additional settlements are made with
non-settling Defendants in the Actions, Settlement Class Counsel will use its
best efforts to obtain the agreement of each Defendant that is not a Settling
Defendant to be subject to the
23
Injunctive
Relief set forth in Sections V.11.a. and b. Settlement Class Counsel
agree that the Injunctive Relief set forth in this Section V.11 constitutes a
New Power Rating Standard as defined in Section 30 of the Settlement Agreement
Between Plaintiffs and MTD Products, Inc. dated the 4th day
of August, 2006 (the “MTD Settlement Agreement”) and Settlement Class Counsel
shall use its best efforts have MTD subject to the Injunctive Relief set forth
in this Section V.11.
12. Settling Defendants’
Continuing Discovery Obligations. Notwithstanding the entry of
a Final Approval Order, the Settling Defendants, other than Tecumseh, agree that
for purposes of discovery only they may be treated as if they were still a party
defendant in the Actions, which discovery shall be governed by the Federal Rules
of Civil Procedure. Any such discovery will
be subject to the rules, orders and procedures of the Court or any Subsequent
Court. Settlement Class Counsel agree to pursue discovery against
Defendants other than the Released Parties prior to seeking discovery from the
Released Parties, and to seek discovery from Released Parties only with respect
to such information not available from Defendants other than the Released
Parties or from other sources. Because Tecumseh is not in the
business of manufacturing or selling lawnmower engines, documents relating to
Tecumseh lawnmower engines are owned by TecumsehPower Company, and TecumsehPower
Company is no longer an operating company, Tecumseh shall not be considered a
Settling Defendant with respect to this provision only and shall be treated as a
third party for purposes of discovery.
VI. COURT
APPROVAL
1. Motion for Preliminary
Approval. At a time deemed appropriate by Interim Co-Lead
Class Counsel, after consultation with the Settling Defendants, Interim Co-Lead
Class Counsel shall submit to the Court a motion for preliminary approval
(“Preliminary Approval”) of
24
the
Settlement and a motion for a stay of all proceedings in the Actions as to the
Released Parties until the Court renders its final decision on approval of the
Settlement. Interim Co-Lead Counsel shall seek an Order requesting,
inter alia, (i) the
Preliminary Approval of the Settlement set forth in the Stipulation, (ii)
Certification of the Settlement Class pursuant to Fed. R. Civ. P. 23 (b)(3) for
settlement purposes only; (iii) appointment of one or more plaintiffs as class
representatives thereof and appointing Settlement Class Counsel, (iv) approval
of the form and content of the Notice and Notice Plan, and (v) deadlines for
persons to file claims, request exclusion from the Settlement Class, or make
submissions in support of or opposition to the Settlement. A copy of
the proposed order granting Preliminary Approval is attached hereto as Exhibit
3. In the event that the Motion for Preliminary Approval of the
Settlement is submitted to the Court on the same day as a motion for preliminary
approval of any other settlement agreement (including, but not limited to the
MTD Settlement Agreement), Settlement Class Counsel agree to present and have
argument on the motions for preliminary approval of the settlement agreements in
the order in which the agreements were entered.
2. Notice to Settlement
Class. In the event that the Court, or any Subsequent Court,
grants Preliminarily Approval of the Settlement in the Action or any Subsequent
Actions, Settlement Class Counsel shall, in accordance with Rule 23 of the
Federal Rules of Civil Procedure and the Court’s order, arrange for the Notice
to be provided to the Settlement Class in accordance with the Notice Plan
approved by the Court.
3. Opt-Outs. Within
10 calendar days after the final day on which Settlement Class Members may
exercise their right to be excluded from the Settlement Class, as established by
the Court and as set forth in the Notice, Settlement Class Counsel shall provide
to the Settling Defendants in writing a list of names and addresses of all
Opt-Outs. In the event that the
25
aggregate
number of Opt-Outs exceed the number agreed upon by the Settling Parties, the
Settling Defendants shall have the right to withdraw from this Settlement
Agreement, upon written notice to Settlement Class Counsel within 10 calendar
days after receipt of the list of Opt-Outs. If the Settling
Defendants withdraw from this Settlement Agreement under this Section, this
Settlement Agreement shall be null and void and the Net Settlement Fund shall be
returned to the Settling Defendants pro rata in accordance with the amount each
Settling Defendant paid into the Fund. The Proposed Class
Representatives agree to participate as Settlement Class Members and to not
opt-out of this Settlement.
4. Proposed Order and Final
Judgment. If the Court grants Preliminary Approval and the
Settling Defendants have not withdrawn from this Agreement, Settlement Class
Counsel and the Settling Defendants shall, at a mutually agreed upon time prior
to the Fairness Hearing, jointly request entry of an order and final judgment,
in the form attached as Exhibit 4:
a. finally
approving certification of the Settlement Class for settlement purposes only and
finally approving the Settlement without material alteration of its
terms;
b. finding
that the terms of the Settlement are fair, reasonable and adequate under
Rule 23 of the Federal Rules of Civil Procedure, and directing consummation
of the Settlement pursuant to the terms and conditions of the Settlement
Agreement;
c. finding
that dissemination of the class notice in the form and manner directed by the
Court was accomplished, was the best notice practicable and satisfies due
process;
d. providing
that each Settlement Class Member who is not an Opt-Out is bound by this
Settlement Agreement regardless of whether the Settlement Class Member submits
any claim;
26
e. approving
such requests to opt-out of the Settlement Class as have been timely and
properly submitted in accordance the Court’s orders;
f. directing
that any and all claims be dismissed with prejudice as to the Released Parties
who are Defendants and, except as provided for herein, without costs to any
party;
g. discharging
and releasing the Released Parties from any and all Released
Claims;
h. reserving
continuing and exclusive jurisdiction over the Settlement Agreement and its
administration, and any dispute, claim, or action arising out of or related to
this Settlement Agreement or its administration;
i. determining
pursuant to Fed. R. Civ. P. 54(b) that there is no just reason for delay and
directing that the judgment of dismissal of the Actions shall be final and
appealable; and
j. determining
that the Settlement is in good faith and bars, extinguishes, and discharges any
claims against the Released Parties by any other Defendant who is not a Released
Party for contribution or indemnity under federal or state law; and preserving
any claim for contribution or indemnity that a Settling Defendant may have
against any other Defendant who is not a Released Party.
VII. RELEASES
1. Releases. In
addition to the effect of any final judgment entered in accordance with this
Settlement Agreement, upon Final Approval Order becoming Final, the Settlement
Class Members in the Actions and/or Subsequent Actions as Releasing Parties,
release and forever discharge each and all of the Released Parties from all
manner of claims, demands,
27
actions,
suits, causes of action, whether class, individual, or otherwise in nature,
damages of any kind (including but not limited to actual, consequential,
special, exemplary and punitive) and whenever incurred, liabilities of any
nature whatsoever, including costs, expenses, penalties and attorneys’ fees,
known or unknown, derivative or direct, suspected or unsuspected, accrued or
unaccrued, asserted or unasserted, in law or equity, including, without
limitation, claims that have been asserted or could have been asserted in the
Actions against the Released Parties, arising out of or related to the Releasing
Party’s purchase or purchases of a lawn mower or a lawn mower engine,
specifically including any claim of conspiracy against the Released Parties,
between January 1, 1994, and the date upon which Notice is first mailed or
otherwise published, that any Releasing Party now has, ever had, or may have had
as of the date of the Final Approval becomes Final (whether or not the
Settlement Class Member objects to the Settlement and whether or not the
Settlement Class Member submits a claim seeking to share in the Settlement Fund
or has such claim approved or not approved) whether directly, representatively,
derivatively or in any other capacity. “Unknown” claims as released
herein means any and all claims that any member of the Settlement Class does not
know to exist against any of the Released Parties which, if known, might have
affected his or her decision to enter into or to be bound by the terms of this
Settlement. The plaintiffs and the members of the Settlement Class
acknowledge that they may hereafter discover facts in addition to or different
from those that they now know or believe to be true concerning the subject
matter of this release, but nevertheless fully, finally, and forever settle and
release any and all Released Claims, known or unknown, derivative or direct,
suspected or unsuspected, accrued or unaccrued, asserted or unasserted, in law
or equity, including, without limitation, claims that have been asserted or
could have been asserted in the Actions against the Released Parties, that any
Releasing Party
28
now has,
ever had, or may have had as of the date of the Final Approval becomes Final.
The foregoing waiver includes, without limitation, an express waiver to the
fullest extent permitted by law, by the Proposed Class Representatives and the
Settlement Class Members of any and all rights under California Civil Code §
1542 or any similar law of any other state or of the United States, which
provides:
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 might have materially affected his or her settlement with
the debtor.
The Settling Parties acknowledge, and
the Settlement Class Members shall be deemed by operation of the Final Approval
Order to have acknowledged, that the foregoing waiver was separately bargained
for and a key element of the Settlement of which this release is a
part.
Upon the Final Approval Order becoming
Final, the Releasing Parties shall not seek to recover against the Released
Parties for any of the Released Claims.
2. The
Releasing Parties further release and shall not bring any claim or any cause of
action that seeks in any way to recover against lawnmower manufacturers,
retailers, dealers, and distributors that sell lawn mowers or lawn mower engines
manufactured or sold by any Released Party where such claim in any way relates
to the horsepower or power ratings, labels or advertising with respect to any
lawn mower or lawn mower engine manufactured or sold by any Released Party (but
not any other lawn mowers or lawn mower engines manufactured or sold by
Defendants other than a Released Party) or in any way related to the contractual
relationships between any Released Party and any lawnmower manufacturer,
retailer, dealer or distributor or for which any Released Party may be held
liable either directly or through a contribution or indemnification claim,
except that nothing in this Settlement Agreement shall release
any
29
lawnmower
manufacturer, retailer, dealer or distributor other than the Released Parties
from any liability for (a) such entity’s knowing and intentional violation of
state or federal law; (b) such entity’s knowing and intentional
misrepresentations or other intentional tortious conduct; (c) payment disputes;
(d) repair or replacement parts or units under warranty, or (e) physical harm or
bodily injury.
3. Reservation of
Claims. Pursuant to this Settlement Agreement, each Settlement
Class Member settles and releases only the Released Parties and lawnmower
manufacturers, retailers, dealers and distributors that the Settlement Class has
released pursuant to Sections VII.1. and 2 herein, and the parties do not intend
this Settlement Agreement, or any part hereof or any other aspect of the
proposed Settlement, to release or otherwise affect in any way any claims or
rights any Settlement Class Member has or may have against any other Defendant
or party or entity whatsoever. More particularly, the fact or terms
of this Settlement with the Settling Defendants and the releases contained
herein shall not be construed to release or limit in any way the joint or
several liability or damage responsibility of any Defendant or alleged
co-conspirator other than the Released Parties and lawnmower manufacturers,
retailers, dealers, and distributors, released pursuant to Sections VII.1 and 2
herein, for the alleged combination and conspiracy, or for sales or other acts
alleged in the Actions, Subsequent Actions or any related action, including, but
not limited to, any alleged damage or responsibility for any of the acts of the
Released Parties. The rights of any Settlement Class Member to
recover the full amount of his judgment from any one or more Defendants who are
not Released Parties are unaffected by this Settlement. In addition,
neither this Settlement Agreement nor the releases set forth in Sections VII.1.
and 2. above shall have any legal effect or other effect on any claims any
Released Party may have against any Settlement Class Member for or arising out
of accounts
30
receivable,
contract obligations, or claims and defenses in unrelated existing or future
litigation or bankruptcy proceedings; nor shall this Settlement Agreement or the
releases set forth in Sections VII.1. and 2. above release or have any legal or
other effect on ordinary commercial or product liability claims arising from the
purchase or sale of any Released Party’s products that do not involve any claims
asserted in the Actions or that could have been asserted in the Actions,
including but not limited to claims relating to payment disputes, physical harm
or bodily injury, repair or replacement of parts or units under
warranty.
4. Indemnity for Claims for
Contribution or Indemnification Asserted by Other
Defendants. Notwithstanding anything to the contrary contained
in this Stipulation, in consideration of the terms hereof and in order to induce
the Settling Defendants to enter into this Stipulation, the Settlement Class
shall exclude from the dollar amount of any judgment in the Actions, any
Subsequent Actions, or any action involving similar claims that is collectable
against any Defendant who is not a Released Party an amount equal to the
percentage or amount of such judgment for which the Released Parties would be
responsible pursuant to a valid and enforceable claim for contribution and/or
indemnification under federal or state law so as to bar, extinguish, discharge
and release under federal and state law any claims for contribution or indemnity
against the Released Parties, or any of them, by a Defendant who is not a
Released Party.
VIII. EXPENSES
AND ATTORNEYS’ FEES.
1. The
Released Parties shall not be responsible for the payment of any attorneys’ fees
of Plaintiffs’ Counsel or costs or expenses of litigation. Rather,
Plaintiffs’ Counsel may seek payment for litigation expenses (including, without
limitation, class representative incentive awards, experts, and settlement
escrow expenses) only from the Settlement Fund. The
Settling
31
Defendants
shall be responsible only for the cost of any notice to state or federal
agencies under 28 U.S.C. §
1715(b). The Settling Defendants take no position on any application
for attorneys fees and expenses. No attorneys’ fees shall be paid
from the Settlement Fund until the Final Approval Order becomes
Final. Notwithstanding the foregoing, after entry of an order of the
MDL Court approving fees and expenses, a plaintiffs’ counsel or firm in the
Actions may give notice to the Settling Defendants that it wishes to be paid
attorneys fees and expenses before the Final Approval Order is
Final. In that circumstance, attorney fees can be paid from the
Settlement Fund only if (1) the request is in compliance with all court orders;
(2) the request is in an amount authorized by Settlement Class Counsel, and (3)
the requesting plaintiffs’ counsel or firm secures the repayment for any such
counsel’s or firm’s fees, plus interest thereon at the prime rate, by a letter
of credit or letters of credit on terms and by banks acceptable to Settling
Defendants. Each plaintiffs’ counsel or firm that is paid attorneys’
fees prior to the Final Approval Order becoming Final shall be required to
reimburse all or the pertinent portion of that counsel’s or firm’s payment, plus
interest thereon at the prime rate, if the award of attorneys’ fees and expenses
is reduced or overturned on appeal, or if this Settlement does not become
Final. Settling Defendants may present the letter(s) of credit in the
event the counsel or firm fails to honor the obligation to repay the amount
withdrawn if the attorneys’ fee and expenses award is reduced or overturned on
appeal, or if this Settlement does not become Final.
2. Any
payment approved by the Court pursuant to Section VIII.1. shall constitute full
satisfaction of Settling Defendants’ and/or any Released Parties ’obligations to
pay amounts to any person, attorney, or law firm for attorneys’ fees, expenses,
or costs incurred on behalf of the Proposed Class Representatives and/or the
Settlement Class, and shall relieve the Settling Defendants and Released Parties
from any other claim or liability to any other attorney or law
32
firm for
any attorneys’ fees, expenses and/or costs on behalf of the Proposed Class
Representatives and/or the Settlement Class. Settlement Class Counsel shall be
solely and legally responsible to pay any and all applicable taxes on the
payment made pursuant to Section VIII.1 and agrees to indemnify and hold
harmless Settling Defendants from any claim or liability for taxes, penalties or
interest for which Settlement Class Counsel is responsible as a result of the
payment made pursuant to Section VIII.1. Settlement Class Counsel
further agrees that any allocation of fees between or among Settlement Class
Counsel and any other attorney representing the plaintiffs and/or the Settlement
Class shall be the sole responsibility of Settlement Class Counsel and
Settlement Class Counsel agrees to indemnify and hold harmless the Released
Parties from any claim or liability by any other person or entity claiming or
seeking to claim any attorneys’ fees or costs.
3. Any
award of attorneys’ fees and costs and any application for such fees and costs,
and any and all matters related thereto, shall not be considered part of the
Stipulation, and shall be considered by the Court separately from the Court’s
consideration of the fairness, reasonableness and adequacy of the Settlement,
and shall not operate to terminate or cancel the Stipulation or Settlement, and
shall not affect or delay the finality of any Final Approval Order approving the
Stipulation and the Settlement of the Actions.
IX. EFFECT OF DISAPPROVAL,
CANCELLATION OR TERMINATION
1. If
the Final Approval Order does not become Final, then the Settlement, this
Stipulation, and any other stipulation shall become null and void. In addition,
the Settling Parties agree that if this Settlement becomes null and void, the
Released Parties shall not be prejudiced in any way from opposing the
certification of a class or classes in the Actions or in any other litigation
that is not one of the Actions, nor shall the Released Parties be prejudiced in
any way
33
from
asserting any and all other defenses to the claims asserted in the Actions or in
any other litigation, or with respect to their assertion of any other rights or
remedies. If this Settlement becomes null and void, the Net
Settlement Fund shall be returned to Settling Defendants.
2. In
the event that the Final Approval Order does not become Final, or the
Stipulation is terminated, or fails to become effective in accordance with its
terms, the Settling Parties and the Settlement Class Members shall be restored
to their respective positions in the Actions as of the date of this Settlement
Agreement. In such event, the terms and provisions of the
Stipulation, with the exception of the last sentence of Section V.1, the second
to last sentence of Section VI.3, and Sections IX.1, IX.2, X.4, and X.9 hereof,
shall have no further force and effect with respect to the Settling Parties and
the Settlement Class Members, and shall not be used in these Actions or in any
other proceeding for any purpose, and any judgment or order entered by the Court
in accordance with the terms of the Stipulation shall be treated as vacated,
nunc pro tunc. Nothing contained in this Settlement Agreement can be
used by any person for any purpose with respect to the issues of class
certification or the merits of the claims or defenses asserted in the Actions or
any related litigation.
X. MISCELLANEOUS
PROVISIONS
1. The
Settling Parties acknowledge that it is their intent to consummate this
Settlement, and agree to cooperate and take whatever steps are necessary and
appropriate to complete the Settlement, to obtain Preliminary and Final Approval
of the Settlement, to effectuate the terms of the Settlement, and to protect the
Settlement by applying for appropriate orders enjoining others from initiating
or prosecuting any action arising out of or related to the facts or claims
alleged in the Actions, if so required.
34
2. To
the extent any disputes or issues arise with respect to documenting the
Settlement, the Settling Parties agree to use their best efforts to informally
resolve any such disputes or issues; but in the event any such dispute or issue
cannot be resolved informally, to bring any such dispute or issue to the Court
for resolution.
3. The
Settling Parties intend the Settlement to be a final and complete resolution of
all disputes between them with respect to the Actions and Subsequent Actions,
except as specifically provided for herein. The Settlement compromises claims
which are contested and shall not be deemed an admission by any Settling Party
as to the merits of any claim or defense. While retaining their right to deny
liability, the Settling Defendants agree that the amount paid to the Settlement
Fund and the other terms of the Settlement were negotiated at all times at arm’s
length and in good faith by the Settling Parties, and reflect a settlement that
was reached voluntarily after consultation with competent legal
counsel. Except as provided in Section VIII.1., each Party shall bear
its own costs.
4. Neither
the Stipulation nor the Settlement contained therein, nor any act performed or
document executed pursuant to or in furtherance of the Stipulation or the
Settlement: (a) is or may be deemed to be, or may be used as an admission or
evidence of, the validity of any claims asserted in the Actions, or of any
wrongdoing or liability on the part of the Released Parties, or (b) is or may be
deemed to be, or may be used as an admission or evidence of, any fault or
omission of any of the Released Parties in any civil, criminal, or
administrative proceeding in any court, administrative agency or other
tribunal. The Released Parties may file the Stipulation and/or the
Final Approval Order in any action that has been or may be brought against them
in order to support a defense or counterclaim based on principles of res
judicata, collateral estoppel, release, good faith settlement, judgment bar,
reduction, or any other theory of
35
claim
preclusion or issue preclusion, or any similar defense or
counterclaim.
5. Each
obligation of each Settling Defendant under this Settlement Agreement is several
and not joint, including each Settling Defendant’s obligation to make payments
into the Settlement Fund as prescribed in Section V.1. of this
Stipulation. In addition, no Settling Defendant other than the
Settling Engine Manufacturer Defendants is responsible for providing Warranty
Relief under this Settlement Agreement. No Settling Engine
Manufacturer Defendant is responsible for providing Warranty Relief under this
Settlement Agreement as to any engines other than the engines that were
initially warranted by that Settling Engine Manufacturer Defendant.
6. No
person shall have any claim against any Settling Defendant, Settling Defendant’s
Counsel, or Settlement Class Counsel based on distribution of benefits made
substantially in accordance with this Stipulation of Settlement or any
Settlement-related order(s) of the Court.
7. If
a case is commenced in respect to a Settling Defendant under Title 11 of the
United States Code (Bankruptcy), or a trustee, receiver or conservator is
appointed under any similar law, and in the event of the entry of a final order
of a court of competent jurisdiction determining the transfer of the Settlement
Funds, or any portion thereof, by or on behalf such Settling Defendant to be a
preference, voidable transfer, fraudulent transfer, or similar transaction, and
that Settling Defendant’s portion of the Settlement Fund is returned to the
Settling Defendant, then, as to that Settling Defendant, the releases given and
Final Approval Order entered in its favor pursuant to this Stipulation shall be
null and void. After the Settlement is Final, nothing in this
Stipulation should be construed to require Settlement Class Counsel or
Settlement Class Member to return any amount of money paid to them under the
Settlement and
36
the
releases provided for herein shall remain in full force and effect.
8. Each
Settling Defendant warrants and represents that it is not “insolvent” within the
meaning of 11 U.S.C. § 101(32) as of the time this Stipulation is executed and
as of the time any payments are transferred or made as required by this
Stipulation.
9. All
agreements made and Orders entered during the course of the Actions relating to
the confidentiality of information shall survive this Stipulation.
10. The
Stipulation may be amended or modified only by a written instrument signed by
all Settling Defendants and Settlement Class Counsel, or their respective
successors-in-interest.
11. This
Stipulation and the agreements referred to herein constitute the entire
agreement among the Settling Parties, and no representations, warranties or
inducements have been made to any Party concerning the Stipulation and the
agreements referred to herein, other than those contained therein. The
Stipulation and the agreements referred to herein replace and void any and all
previous agreements concerning the settlement of the Actions.
12. Settlement
Class Counsel, on behalf of the Settlement Class, are expressly authorized by
the Court’s January 27, 2009, Order to take all appropriate action required or
permitted to be taken by the Settlement Class pursuant to the Stipulation to
effectuate its terms, and also are expressly authorized to enter into any
modifications or amendments to the Stipulation on behalf of the Settlement Class
which they deem necessary or appropriate.
13. Each
attorney executing the Stipulation on behalf of any party hereto hereby warrants
that such attorney has the full authority to do so.
14. This
Stipulation may be executed in one or more counterparts. All executed
counterparts and each of them shall be deemed to be one and the same instrument.
A complete set
37
of
original executed counterparts shall be filed with the Court.
15. This
Stipulation shall be binding upon, and inure to the benefit of, the successors
and assigns of the Settling Parties hereto.
16. The
Court shall retain jurisdiction with respect to implementation and enforcement
of the terms of the Stipulation and for the entry of appropriate orders
enjoining others from initiating or prosecuting any action arising out of or
related to the facts or claims alleged in the Actions, if so
required. The Settling Parties hereto submit to the jurisdiction of
the Court for purposes of implementing and enforcing the Settlement embodied in
the Stipulation. The Parties shall present the Court with proposed Orders that
allow for such a retention of jurisdiction, in accordance with applicable
law.
17. The
Stipulation shall be considered to have been negotiated, executed and delivered,
and to be wholly performed, in the State of Illinois, and the rights and
obligations of the parties to the Stipulation shall be construed and enforced in
accordance with, and governed by, the internal, substantive laws of the State of
Illinois without giving effect to that State’s choice-of-law
principles.
18. This
Settlement Agreement shall not provide any rights to, or be enforceable by, any
person or entity who is not a Settlement Class Member, a Released Party or
Settlement Class Counsel. Absent Court order, no Settlement Class
Member or Settlement Class Counsel may assign or otherwise convey any right to
enforce any provision of this Settlement Agreement.
19. All
notices between the Settling Defendants and Settlement Class Counsel under this
Settlement Agreement shall be in writing. Each such notice shall be
given either by (a) hand delivery; (b) registered or certified mail,
return receipt requested, postage pre-paid; (c) first class U.S. mail together
with simultaneous facsimile transmission; or (d) an overnight express
delivery
38
service
and, in the case of either (a), (b) (c) or (d) shall be addressed, if directed
to Settlement Class Counsel or counsel for the Settling Defendants, to the
addresses set forth on the signature pages hereof, or such other address as any
of them may subsequently provide, pursuant to notice in the manner described in
this Section.
20. Any
inconsistency between this Settlement Agreement and any other agreement between
the Settlement Class and the Settling Defendants shall be resolved in favor of
the Settlement Agreement. The headings used in this Settlement
Agreement are intended for the convenience of the reader only and shall not
affect the meaning or interpretation of this Settlement Agreement.
21. No
party or signatory shall be considered the drafter of this Settlement Agreement
for the purpose of any statute, case law or rule of interpretation or
construction that would or might cause any provision to be construed against the
drafter.
IN
WITNESS WHEREOF, the Settling Parties, through their authorized representatives,
have agreed and entered into this Settlement Agreement as of the date first
written above.
39
ON BEHALF
OF PROPOSED CLASS REPRESENTATIVES AND THE SETTLEMENT CLASS:
/s/ Vincent
J. Esades
___________________________________
Vincent
J. Esades, Settlement Class Counsel
HEINS
MILLS & OLSON PLC
310
Clifton Ave.
Minneapolis,
MN 55403
PH: 612-338-4605
FX: 612-338-4692
vesades@heinsmills.com
Brian M.
Sund
MORRISON,
FENSKE & SUND PA
5125
County Road 101
Suite
102
Minnetonka,
MN 55345
PH: 952-975-005
FX: 952-975-0058
bsund@morrisonfenske.com
ON BEHALF
OF SEARS, ROEBUCK AND CO., SEARS HOLDINGS CORPORATION AND KMART HOLDING
CORPORATION
/s/ Debbie
L. Berman
________________________________
Debbie L.
Berman
JENNER
& BLOCK LLP
353 N.
Clark St.
Chicago,
IL 60654-3456
PH: 312-923-2764
FX: 312-840-7764
dberman@jenner.com
40
ON BEHALF
OF BRIGGS & STRATTON CORPORATION:
/s/ Thomas
O. Kuhns
___________________________
Thomas O.
Kuhns
KIRKLAND
& ELLIS LLP
200 E.
Randolph Dr.
Chicago,
IL 60601
PH: 312-862-2302
FX: 312-861-2200
tkuhns@kirkland.com
ON BEHALF
OF DEERE & COMPANY:
/s/ Scott
M. Mendel
___________________________
Scott M.
Mendel
K&L
GATES LLP
70 W.
Madison St.
Chicago,
IL 60602
PH: 312-372-1121
FX: 312-827-8000
scott.mendel@klgates.com
ON BEHALF
OF ELECTROLUX HOME PRODUCTS, INC. and HUSQVARNA OUTDOOR PRODUCTS, INC. (NOW
KNOWN AS HUSQVARNA CONSUMER OUTDOOR PRODUCTS, N.A., INC.):
/s/ Roger
L. Longtin
___________________________
Roger L.
Longtin
DLA
PIPER LLP (US)
203 N.
LaSalle St., Suite 1900
Chicago,
IL 60601
PH: 312-368-4040
FX: 312-236-7516
roger.longtin@piperrudnick.com
41
ON BEHALF
OF THE TORO COMPANY:
/s/ William
H. Manning
___________________________
William
H. Manning
ROBINS,
KAPLAN, MILLER & CIRESI LLP
800
LaSalle Ave.
Minneapolis,
MN 55402
PH: 612-349-8461
FX: 612-339-4181
whmanning@rkmc.com
ON BEHALF
OF TECUMSEH PRODUCTS COMPANY:
/s/ Suzanne
K. Richards
_____________________________
Suzanne
K. Richards
VORYS,
SATER, SEYMOUR AND PEASE LLP
52 East
Gay St.
Columbus,
OH 43216
PH: 614-464-6458
FX: 614-719-4920
skrichards@vorys.com
42