Cy Pres & Residual Fund Awards
Cy pres awards are residual funds in class action cases that, for any number of reasons, are unclaimed or cannot be distributed to the class members or beneficiaries who were the intended recipients. Under the cy pres doctrine and Illinois law, courts can distribute these residual funds to appropriate charitable causes, and the CBF and the legal aid organizations and related initiatives the CBF supports are appropriate beneficiaries.
The CBF’s mission of improving access to justice for those less fortunate makes it an ideal match for class action cy pres awards, as one underlying premise for all class actions is to make access to justice a reality for people who otherwise would not be able to obtain the protections of the court system. Cy pres awards have made possible a number of innovative projects and initiatives in the state and federal courts and enable the CBF to provide ongoing support for these efforts.
For more information about cy pres awards and other awards of residual funds and how you can make an impact by directing such an award to the CBF, contact Bob Glaves at bglaves@chicagobarfoundation.org or at 312.554.1205.
Firms Directing Cy pres Awards to the CBF
The CBF is grateful to the following law firms and many individual lawyers within those firms for their role in directing cy pres awards to the CBF:
Anderson & Wanca
Baker & Daniels LLC
Baldi Berg, Ltd.Bardo Law P.C.
Barnow & Associates, P.C.
Barrett & Associates
Baskin, Server, Berke & Weinstein
Bernstein Litowitz Berger & Grossman
Beaumont Costales LLC
Bock, Hatch, Lewis & Oppenheim, LLC
Burke Law Offices, LLC
Caffarelli & Associates LTD
Cafferty Faucher LLP
Cohen Milstein Sellers & Toll PLLC
The Collins Law Firm, P.C.
Consumer Advocacy Center, P.C.
Crane, Heyman, Simon, Welch & Clar
Dentons US LLP
DLA Piper LLP (US)
Donaldson & Guin LLC
Dykema Gossett PLLC
Edelman, Combs, Latturner & Goodwin, LLC
Edelson PC
Fish Potter Bolanos, P.C.
Futterman Howard Watkins Wylie & Ashley, CHTD.
Gary M. Klinger
Goodhart Law Firm, Ltd.
Goodwin Proctor LLP
Gordon & Rees LLP
Greenberg Traurig LLP
Grippo & Elden LLC
Hinshaw & Culbertson LLP
Holland & Knight LLP
Holstein Law Offices, LLC
Honigman LLP
Ice Miller LLP
Jonathan Nachsin, P.C.
Jones Day
Jenner & Block LLP
Johnson & Bell, Ltd.
Jonathan Nachsin, P.C.
Jones Day
Kanner & Whiteley, LLC
Katsky Korins LLP
Kaufman Dolowich & Voluck LLP
Keogh Law, Ltd.
Kirkland & Ellis LLP
Krislov & Associatets, Ltd.
Labaton Sucharow LLP
Laner, Muchin, Dombrow, Becker, Levin and Tominberg, Ltd.
LaPointeLaw, P.C.
Larry D. Drury, Ltd.
Latham & Watkins LLP
Law Office of Aron D. Robinson
Law Office of Arthur Susman
Law Offices of Bernard M. Gross, P.C.
Leiff, Cabraser, Heimann & Bernstein LLP
Law Offices of Ronald A. Marron
Littler Mendelson P.C.
Lockridge Grindal Nauen PLLP
Lowis & Gellen LLP
Mark Silverman Law Office, Ltd.
Markoff Leinberger LLC
Mayer Brown LLP
McCarter & English, LLP
McDermott Will & Emery
McGuire Law, P.C.
McGuireWoods LLP
McMorrow Law, LLC
Meckler Bulger Tilson Marick & Pearson LLP
Milberg LLP
Miller Law LLC
Morgan, Lewis & Bockius LLP
Much Shelist P.C.
Myron M. Cherry & Associates LLC
Nick Larry Law LLC
Nisen & Elliott
Philips and Philips, Ltd.
Pretzel & Stouffer, Chtd.
Querrey & Harrow, Ltd.
Rachlis Durham Duff & Adler, LLC
Reed Smith LLP
Robbins Geller Rudman & Dowd, LLP
Robinson Curley & Clayton, P.C.
Schad, Diamond & Shedden, P.C.
Schoenberg Finkel Newman & Rosenberg, LLC
Sessions Fishman Nathan & Israel, L.L.C.
Seyfarth Shaw LLP
Shea Rogal & Associates
Shepherd, Finkelman, Miller & Shah, LLP
Sidley Austin LLP
Siprut PC
Skadden, Arps, Slate, Meagher & Flom LLP
Smith & McMorrow, P.C
Susman Heffner & Hurst LLP
Swanson, Martin & Bell, LLP
Thomas & Kampsen
Thompson Coburn LLP
The Thompson Firm
Vedder Price PC
Waskowski Johnson Yohalem LLP
Werman Salas P.C.
William J. Harte, Ltd.
Winston & Strawn LLP
Wood Finko & Thompson P.C.
Workers’ Law Office, P.C.
Zimmerman Law Offices, P.C.
State Court Cases
Illinois law (735 ILCS 5/2-807) establishes a presumption that any residual funds in class action settlements or judgments will go to organizations like the CBF that improve access to justice for low-income Illinois residents. Courts have the discretion to award up to 50% of these funds to other organizations that serve the public good as part of a settlement if the court finds good cause to do so. In any event, at least 50% of any residual funds in class action cases must go to one or more organizations like the CBF that promote or provide access to justice for low-income Illinoisans.
This article provides a good primer on how the statute works. Sample language that can be used for settlements of Illinois class actions is available here.
Federal Court Cases
Federal courts in Illinois and elsewhere in the country have long recognized that under the cy pres doctrine, courts can distribute cy pres or residual funds to appropriate charitable causes, and the CBF and the legal aid organizations and related initiatives the CBF supports are appropriate beneficiaries. See, e.g., Doyle, Residual Funds in Class Action Settlements: Using “Cy Pres” Awards to Promote Access to Justice, Federal Lawyer, July 2010.
Among the federal court projects that cy pres awards have made possible and continue to support through the CBF are the District Court Advice Desk and the Court’s Settlement Assistance Program.
Sample language that can be used for settlements of class actions
Bankruptcy Court Cases
Courts in Illinois and elsewhere in the country have long recognized that under the cy pres doctrine, courts can distribute residual funds in bankruptcy and other federal cases to appropriate charitable causes, and the CBF and the legal aid organizations and related initiatives the CBF supports are appropriate beneficiaries. See, e.g., In re Xpedior Inc., 2006 WL 3017330 (Bkrtcy. N.D. Ill., Oct. 23, 2006); Superior Beverage Co. v Owens-Illinois, Inc., 827 F. Supp. 477 (N.D. Ill. 1993) (approving distribution of unclaimed funds to a variety of charitable organizations); In re Scouring Pads Antitrust Litigation, No. 93 C 6594, 1995 WL 290242, at *1 (N.D. Ill., May 11, 1995).
Among the bankruptcy court projects that cy pres awards have made possible and continue to support through the CBF is the Bankruptcy Court Help Desk, which provides a critical service to the court by providing advice, brief assistance, and referrals to hundreds of pro se litigants in the court each year. These awards also help make it possible for the CBF to provide steady support for the major pro bono and legal aid organizations that serve clients in bankruptcy court.
Sample language that can be used for bankruptcy cases is available by clicking here.