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Fleury v. Richemont North America, Inc., C-05-4525 EMC, 2008 WL 3287154 (N. D. Cal. Aug. 6, 2008).

After the Northern District of California’s ruling on their application for attorney fees, maybe the class counsel for the settling plaintiffs should enlist Elton John’s help in encouraging the class members to use the “relief” afforded to them in the settlement in this lawsuit. It just might turn a dull and dreary mere $1.24 million attorney fee award into something more befitting royalty and Sheiks.

In Fleury v. Richemont North America, Inc., the class members had complained that “world renowned French jeweler and watchmaker” (ooh la la!) Cartier refused to sell Cartier watch parts to non-Cartier authorized watch dealers for use in servicing Cartier watches. The case was settled by an agreement for members of the consumer subclass to receive $100 credits for use with Cartier dealers. These credits formed the majority of the value of the settlement, which class counsel asserted to be worth at least $9,791,800. The opinion cited in this post addresses the settling plaintiffs’ request for an attorney fee award.

The request initially sought an award of fees based on a percentage of the total settlement value. The court demurred and asked for additional briefing on whether a fee award determination would be premature until it could assess the rate of redemption of the credits and other relief, because the settlement agreement established a coupon-like regime for class members.

The court cited CAFA’s limitation of fee awards: “[i]f a proposed settlement in a class action provides for a recovery of coupons to a class member, the portion of any attorney's fee award to class counsel that is attributable to the award of the coupons shall be based on the value to class members of the coupons that are redeemed.” 

Although CAFA does not define “coupon,” the court looked to CAFA’s legislative history (finally someone is looking at the history) suggesting “that a coupon is a discount on another product or service offered by the defendant in the lawsuit.” The court rejected the notion that the $100 credits should not be considered coupons because they could conceivably be used to buy entire products, astutely pointing out that “the reality is that most Cartier products cost significantly more than $100.”

In the end, the court determined that the lodestar method of determining fees was more appropriate than the percentage method. Under the lodestar method, a reasonable attorney's fee is determined by the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate, subject to adjustment upwards or downwards based on a variety of factors, including the results obtained in the litigation. In response to the court’s suggestion that CAFA’s limitation on fee awards might still require it to delay ruling, even under the lodestar method, the settling plaintiffs suggested that the court could award the lodestar now and simply defer ruling on whether the settling plaintiffs were entitled to an adjustment upwards based on its evaluation of the results obtained. This would be determined by reviewing the number of consumer credits redeemed and how much the class members availed themselves of the other agreed relief.

Apparently not feeling rather weary about the case, the court invited the parties to return in six months with a report regarding the results obtained in terms of the numbers of credits redeemed and views on whether the fee award should be adjusted upwards by some multiplier based on results obtained. 

So, class counsel, round up some of those class members, drive your roller up to Bond Street (or your local high end new urbanism lifestyle center) and get them to make your day by spending those credits at Cartier!

Here is a comment from someone who knows about this case:

Dear Sir,

I apreciated your article about Fleury V. Cartier. It is now over for the one who did not opt-out of the case.(Over 200opted-out). It may be of interest to you that Judge Chen even though stating a"relatively meager results" awarded Mr. Simon and Mr. Spellberg over $1.6million in fees. Such fees for a "relatively meager results"which consist of coupons for the consumer class,, one must wonder what would have been their fees if they would have recover anything for the watchmaker's class?

Regards

Andre Fleury

Posted By McGlinchey Stafford at 10:30 AM | Comments / Questions (4)

Reality V. Speculation:

According to Cartier, their profit on merchandise is 3.2 fold which makes the cost of these coupons at $31.25 each.
If 75,000 coupons are redeemed, the actual recovery is approximately $2.3 millions on coupons only. They are only valid against a purchase of Cartier's merchandise, no cash refund.
It must be mentioned that there is no cash recovery for the consumers and the watchmaker’s class.
The only cash recovery is for the attorneys. They have already been rewarded approximately $1.3 millions cash and $10.000 for the two class’s representatives.

Dear Sir,

How is it possible that two attorneys be awarded over $1.6 million in fees for a recovery of $69,000 in coupons at Cartier's cost value ?

Case Fleury V Cartier.

Dear Sir,

On June 30th 2010, I will be back before Judge Chen who accepted to hear my Motion to Annul and/or Revise the Final Settlement that brought absolutely nothing to the watchmakers and very minute results to the consumers.

It is important to note that the attorneys representing the interest of both classes are attempting to have the Motion beneficial to their client Strike-out.

06/25/2010
Memorandum in Opposition
Docket Text: Opposition to [454] MOTION to Strike filed by Andre Fleury, Sacha Fleury. (slh, COURT STAFF) (Filed on 6/25/2010)

Doc,375,

06/02/2010
Memorandum in Opposition
Docket Text: Memorandum in Opposition re [364] MOTION to Revise and/or Annul the Final Settlement filed byCharles Cleves, Liz Hart, Mike Mertaban, Dennis Warner. (Simon, Bruce) (Filed on 6/2/2010)

Judge Chen receive approximately 80 letters from watchmakers and consumers in support to the Motion to Annul and/or Revise the final settlement.

Regards

Andre Fleury

The latest in the case Fleury V. Cartier:
June 6, 2011
Office of Deputy Assistant Attorney General for Criminal Enforcement
Antitrust Division, U.S. Dept. of Justice
950 Pennsylvania Ave., NW., Suite 3218
Washington, DC 20530
202-514-3543

Dear Sir,
In the last few years, over fifty mostly Swiss watch manufacturing companies have adopted a monopolistic policy to solely control the watch repair market in the United States. That market represents hundreds of millions yearly. Consumers are paying two to five times what they should for a servicing of their watches.
By refusing to sell to independent watchmakers or the owner of their products, the replacement parts necessary for the regular servicing of their watches, they became the sole provider of that service and by policing the watchmakers fully control that market. If that practice is allowed to continue, within few years the independent watchmakers will disappear. The American consumers place at the mercy of these companies. They will have succeeded by eliminating the competition.

Restricting parts companies policies do not supersede settled US laws; the Sherman Act was designed to protect small companies against monopolistic practice and to keep competition alive. Nine Supreme Courts have ruled about the watchmakers , that prohibits monopolistic behavior, and precludes any requirement that watchmakers must pass a test or satisfy licensing requirements in order to earning a living. Such practices were supported by the Watchmaker’s Act. However overturned in 1952 in State of Oklahoma v. Wood, 207 Okla. 193 (1952), that Court surveyed the laws that apply to watchmakers and found that there is no excuse for requiring a watchmaker to pass a test as to his technical qualifications and his right to earn a living:

”Defendant demurred to the petition generally, and also upon the ground that the plaintiff had no legal capacity to sue; that the [Oklahoma] Watchmaking Act is void in that it deprives defendant of inherent rights, privileges and immunities guaranteed by the State and Federal Constitutions, in numerous particulars, to wit: That it seeks to deprive him of the right to liberty, the pursuit of happiness, and the enjoyment of the gains of his own industry; to deprive him of his property without due process of law, and to deprive him of his right to earn a livelihood in a legitimate field of business, that of watchmaking, and of his right to contract in matters of purely private concern; that it violates the Bill of Rights of the Federal Constitution and seeks to create a monopoly of the business of watchmaking; that it grants to a certain class of citizens certain exclusive rights, privileges and immunities, to the exclusion of others; that it grants arbitrary powers to the Oklahoma Board of Examiners in watchmaking and gives such Board unlimited powers to permit a certain class to engage in watchmaking, to the exclusion of others, thus giving such Board legislative powers to establish rules and regulations and to arbitrarily make additional regulations to those required by statute; that it undertakes to authorize the exercise of police power concerning a matter which does not affect the public peace, health, safety, or general welfare, without any public necessity."

This note shows that that the Supreme Courts of Arizona, Florida, Georgia, Hawaii, North Dakota, Tennessee, and Virginia have passed on this question as to photographers. There is no more excuse for requiring a watchmaker to pass a test as to his technical qualifications than for requiring a photographer to pass such a test”.

Parts are only available to watchmakers who are willing to enter in a contract with these restricting companies, and be subjected to technical ability tests, price fixing, and for some forced into misleading the consumers of what is really done under the label “Complete Service “to their watches. Some watchmakers are willing to violate our laws to be able to earn a living.

The sale power of these watch companies is at minimum seventy five percent of the total servicing market. Their power and money makes it impossible for independents watchmakers to successfully find justice in a court of law.
I have attempted to solve this situation in Court, but Cartier’s monetary power left us no chance to succeed. Approximately three hundred of us were left with no option but to opt-out of the case. In few words:
1. Mediation day Cartier agreed not to contest my then attorneys Mr. Simon and Mr. Spellberg fees up to $2 million.
2. Mr. Simon and Mr. Spellberg made sure to replace the plaintiff with the President and past President of AWCI (American Watchmakers and Clockmakers Institute) Institute who receives tens of thousand of dollars yearly from the defendant Cartier. AWCI’s President and past President, Mr. Simon and Mr. Spellberg made certain to protect the interest of defendant Cartier, their benefactor and ignore the interest of the watchmaker’s class they were supposed to represent.
3. The case results speak for it-self, attorneys fees awarded over: $1.6 million. Watchmaker’s class recovery was an absolute zero. AWCI keep receiving tens of thousand dollars yearly from the defendant group.
4. Cartier’s given sole authority to accept or reject any parts account applicant.
5. Watchmakers force to enter into a contract with defendant Cartier to apply for a parts account. This contract forces the watchmaker’s applicant to be subjected to test as of his/her technical ability and oblige to follow Cartier’s price of servicing list among a lot of other obligations.
Major Restricting companies list:
• A. Lange & Sohne, Guess, Harry Winston ,Hublot ,Invicta ,Jaeger-Lecoultre ,Krieger ,Luminox ,Marcel Watch ,Meylan Stopwatches ,Mont Blanc ,Oris ,Parmigiani ,Piaget ,Pierre Balmain ,Raymond Weil ,Revue Thommen ,RGM ,Sector ,Skagen ,Tourneau ,Tutima ,Ulysse Nardin ,Vacheron Constantin ,Van Cleef & Arpels ,Zodiac ,Alfred Dunhill ,Ball (modern Swiss) ,Bertolucci ,Blancpain ,Breguet ,Breitling ,Bulgari ,Cartier ,Certina ,Chaumet ,Chopard ,Daniel ,ink ,David Yurman ,Dior ,Doxa ,Fossil ,Franck Muller ,Frederique Constant ,Glycine , Piaget, Panerai .
Exhibit A.

Cartier and two other Swiss Watch companies’ letters undeniably prove their adoption of monopolistic practice:

Cartier letter states:
• As of January 1. 2003 all after sales service on Cartier Watches will only be available to the consumer through the following means:
• Cartier Retail Boutiques
• Authorized Cartier Watch Dealers
• Directly with Cartier After Sales Service Department.

MontBlanc letter states:
• “out of warranty repairs, Montblanc does not authorize anyone, other than Montblanc Service Center, to make repairs on our product.”

Vacheron Constantin letter states:
• “all request for servicing our watches exclusively toward our own distributors.”

How can any company claim authority over a product sold to consumers?
As today they do. If that is acceptable then the consumers should be made aware that he / she is not purchasing a watch but leasing it.

I am earnestly requesting on behalf of the consumers and the independent watchmakers still in business to put a stop as soon as possible to these unlawful practices. Money should not buy justice or buy a blind eye upon their reprehensible and prohibited conducts. So far the above persons and companies succeeded and still operate like business as usual!
Note: example of the attorneys knowingly misleading: they claimed a recovery of $21.5 million mediation day then asserted a recovery of above $10 million on their motion for fees. Both recoveries were flagrant fraudulent and deceitful assertion as facts. The case results can’t be denied, these millions never existed.

We thank you in advance and still hope for a fast remedy to these serious violations by greedy companies and individuals. I will answer any question that may arise and provide you with all damaging documents against these outlaws, in my possession.

I declare under penalty of perjury that the above statements are true and correct.

Truly yours

Andre Fleury