Court of Appeals Overturns Wesson Oil Settlement, Saying It ‘Reeks of Collusion’

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A Court of Appeals has overturned a class action settlement almost 10 years in the making between consumers and ConAgra Food Inc. over Wesson cooking oil products, saying it was full of red flags. 

The class action settlement over ConAgra’s labeling on Wesson ‘Natural’ cooking oil products was overturned Tuesday by a Ninth Circuit panel that wrote in its published opinion that the agreement “reeks of collusion,” Law360 reported. 

The settlement was originally filed for approval in 2019 in order to settle claims that ConAgra Foods deceptively marketed its Wesson brand vegetable oils as “100% natural,” even though they are made from genetically modified plants and organisms.

Consumers had started to file for their refunds under the agreement, when the settlement began to be hit with multiple appeals in 2020. Settlement payments are not given out until all appeals are exhausted. 

Now, it seems any refunds will be delayed indefinitely, until the settlement is resolved. The Ninth Circuit panel said in its opinion Tuesday that the agreement included a number of questionable provisions, in particular attorney fees of $6.85 million that dwarfed the amount going to consumers. 

In the end, ConAgra paid out less than $8 million, with just $1 million going to the class, Law360 reported. Class Members who submitted a valid approved claim were set to be entitled to receive just 15¢ per unit of the Wesson Oil Product purchased. 

The fact that the counsel fees were so much larger than the payout for consumers raised the possibility that lawyers for the Class had colluded with ConAgra to decrease the total settlement in exchange for a larger attorney fee award, the Court of Appeals panel said.

They said a defendant would agree to this sort of deal because they don’t care how the funds are divided, they just want to pay as little as possible.

The panel added that district courts need to carefully look at how much attorneys are giving themselves in fees when they decide if a settlement is fair. The case will now head back to California federal court.

Meanwhile, ConAgra is dealing with another class action settlement. In late 2020, a Class of workers alleging violations of California wage laws asked a federal judge to sign off on an $18 million settlement.

What do you think of the lawyers’ fees included in this ConAgra settlement? Let us know in the comments!

The Class is represented by Ariana J. Tadler, A.J. de Bartolomeo and Brian R. Morrison of Tadler Law LLP, David E. Azar of Milberg Phillips Grossman LLP, Adam J. Levitt and Amy E. Keller of DiCello Levitt Gutzler LLC, and Samuel Issacharroff and Robert Klonoff.

The ConaAgra Oil Class Action Settlement Appeal is Briseño et al. v. ConAgra Foods Inc., Case No. 19-56297, in the U.S. Court of Appeals for the Ninth Circuit.

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