Congressional staff heard differing views about the Supreme Court's likely approach to cy pres next term in Frank v. Gaos. CCL President Robert S. Peck suggested that the Supreme Court is likely to take a very narrow view of the issue, based on the facts in the case. Peck presented, along with Adam Schulman, a lawyer with the group headed by Petition Ted Frank, who brought the challenge. The event was sponsored by the Congressional Civil Justice Academy, a part of the Law and Economics Center at the Antonin Scalia Law School at George Mason University.

      In Frank, the Ninth Circuit upheld a class action settlement that grew out of the information that Google acquired, used and distributed when Internet surfers use that search engine. Though the damage suffered by uninformed surfers was difficult to monetize and the case itself was three times challenged with motions to dismiss, a mediator suggested the settlement that both sides accepted. As part of the settlement, Google agreed to provide a permanent disclosure of what information it collects and how it uses it. In addition, Google agreed to pay compensatory damages of $8.5 million. After attorney fees, costs, and incentive compensation for the named class representatives, the court was left with $5.3 million to be distributed to 129 million class members, an average of 4.1 cents apiece. The court determined that distribution was infeasible given that a process for proof of claim and the process of sending checks would cost substantially more than the four cents each claimant was owed. Instead, the court entertained proposals for non-profit organizations that work in the area of Internet privacy as alternate recipients. 

     The organizations suggested provided the court with proposals about how the money would be spent to advance Internet privacy. After a seven-month process of examination, the court approved each of the organizations as highly qualified, even though it lamented that the groups were the "usual suspects" on this subject. Objector Frank proposed an alternative approach that would compensate only some members of the class at a $5 or $10 rate given the low claiming rate that might be accepted. While the Ninth Circuit held that that approach would have been acceptable, it found nothing wrong with the use of cy pres to send the money to the organizations, utilizing the deferential abuse of discretion standard of reviewing the trial court. 

      The Supreme Court will consider whether the approach approved by the Ninth Circuit comported with Rule 23's requirement that class action settlements be fair, reasonable and adequate.