A recent ABA Journal story, “New Mini-Wheats Settlement Get Preliminary OK; Deal Value Dropped, But Not Attorney Fees,” reports that U.S. District Judge Irma Gonzalez gave preliminary approval to a new settlement in a suit claiming Kellogg’s made false advertising claims about Frosted Mini-Wheats.  Gonzalez, however, raised concerns over the fee request.  ”How is it that the value to the class dropped approximately 75 percent, while requesting attorneys’ fee appear nearly constant?” she wrote.

The plaintiffs had disputed claims that Frosted Mini-Wheats cereal was clinically shown to improve attentiveness by 20 percent.  The original deal, valued at about $8.5 million to the class, provided about $2 million in attorney fees and money for claims administration.  The Ninth U.S. Circuit Court of Appeals had nixed the original deal last year because of cy pres provisions calling for $5.5 million in food donations to feed the needy.  The original deal reimbursed class members $5 for each future box of cereal they buy, with a cap of $15.  Attorney fees amounted to $2,100 an hour, according to the Ninth Circuit, which expressed concern about the level.

The new deal pays $1.5 million to $2 million for attorney fees and claims administration, leaving $2 million to $2.5 million for the class, Gonzalez said.  Consumers will get up to $15 for cereal purchases, but the amount will increase up to $45 per person if the money remains in the settlement fund, according to the proposed settlement (pdf).  Any money left over will go to three groups: Consumer Watchdog, Consumer Union and the Center for Science in the Public Interest.

NALFA also reported on this case in “Ninth Circuit Rejects Attorney Fees in Kellogg Case” and “Ninth Circuit Rewrites Attorney Fee Claim in Kellogg Case.”  For more information on this case, visit http://www.bholaw.com/miniwheats.html and http://www.cerealsettlement.com/