NOTICE OF PROPOSED CLASS ACTION SETTLEMENT AND FINAL APPROVAL HEARING

Transcription

1 NOTICE OF PROPOSED CLASS ACTION SETTLEMENT AND FINAL APPROVAL HEARING LEGAL NOTICE BY ORDER OF THE SUPERIOR COURT OF THE STATE OF CALIFORNIA, COUNTY OF SAN DIEGO. IF YOU PURCHASED MERCHANDISE FROM SPORTS WAREHOUSE THAT WAS ADVERTISED WITH A PRICE COMPARISON, YOU COULD RECEIVE MONEY FROM A CLASS ACTION SETTLEMENT. A court authorized this Notice. This is not a solicitation from a lawyer. A settlement has been reached with Sports Warehouse in a class action lawsuit ( Action ) alleging that Sports Warehouse used false former price comparisons in its advertisements for athletic products and apparel from January 17, 2013 to October 23, The Action is known as McDuffee v. Sports Warehouse, Case No CU-BT-NC, pending in the Superior Court of the State of California, County of San Diego. Sports Warehouse denies that it used false comparison advertising, denies allegations of wrongdoing or liability, and denies that the plaintiff or the class has been harmed in any way. You are receiving this notice because Sports Warehouse s records show you may be a Settlement Class Member. Your legal rights are affected whether you act or do not act. This Notice includes information on the settlement. Please read the entire Notice carefully. YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT SUBMIT A CLAIM FORM EXCLUDE YOURSELF (OPT-OUT) OBJECT The only way to get a payment. If the Court grants final approval to the settlement, this is the only way to be eligible to receive a settlement payment. This is the only option that allows you to retain your rights to sue Sports Warehouse, at your own expense, for claims released in this settlement. However, you will give up the right to get a payment from this settlement. If you do not exclude yourself, you may write to the Court about why you object to the settlement and think it should not be approved. You may mail your objection to the Clerk of the Court. Alternatively, you may file your objection in person at the San Diego Superior Court. You must also mail your written objection to Class Counsel and Sports Warehouse s Counsel. The address for Class Counsel is CounselOne, P.C., 9301 Wilshire Boulevard, Suite 650, Beverly Hills, CA The address for Sports Warehouse s counsel is Alejandro S. Angulo, Rutan & Tucker, LLP, 611 Anton Boulevard, 14th Floor, Costa Mesa, CA Additional instructions regarding how to object to the settlement are contained in this Notice. You may, but are not required to, speak at the Final Approval Hearing about your written objection. If you intend to speak at the Final Approval Hearing, you must include your intention to do so in your written objection. Follow the procedure described herein for providing your written notice to the Court as well as Class Counsel and Sports Warehouse s Counsel. Deadline: May 21, 2018 Deadline: May 21, 2018 Deadline: May 21, 2018 Page 1 of 9

2 ATTEND THE FINAL APPROVAL HEARING The Court will hold a Final Approval Hearing to consider the settlement, the request for attorneys fees and expenses of the lawyers who brought the Action ( Class Counsel ), and the request for an enhancement payment to the plaintiff who brought the Action ( Class Representative ). You may attend the hearing, but you are not required to do so. The date of the hearing may change without further notice, so please check the Settlement Website for updates. June 15, 2018 at 1:30 p.m. DO NOTHING You will not receive a payment, even if the Court gives final approval to the settlement. You will also be giving up any claims you may have against Sports Warehouse released in this settlement. No deadline These rights and options and the deadlines to exercise them are explained in this Notice. Page 2 of 9

3 WHAT THIS NOTICE CONTAINS BASIC INFORMATION PAGE 4 1. Why was this Notice issued? 2. What is this lawsuit about? 3. What is a class action? 4. Why is there a settlement? WHO IS INCLUDED IN THE SETTLEMENT PAGE 4 5. How do I know whether I am part of the settlement? THE SETTLEMENT BENEFITS WHAT YOU GET IF YOU QUALIFY PAGE 5 6. What does the settlement provide? 7. How much will my payment be? HOW TO GET A SETTLEMENT PAYMENT SUBMITTING A CLAIM FORM PAGE 5 8. How do I get a payment from the settlement? 9. When would I get my settlement payment? 10. What rights am I giving up to get a payment and stay in the Settlement Class? 11. What claims are being released? THE LAWYERS REPRESENTING YOU PAGE Do I have a lawyer in this case? 13. How will the lawyers be paid? 14. How much will the Class Representative receive for his efforts in bringing this Action? EXCLUDING YOURSELF FROM THE SETTLEMENT PAGE How do I exclude myself from the settlement? 16. If I exclude myself, can I still get a payment from this settlement? 17. If I do not exclude myself, can I sue Sports Warehouse for the same legal claims later? OBJECTING TO THE SETTLEMENT PAGE How do I tell the Court that I do not agree with the settlement? 19. May I come to Court to speak about my objection at the Final Approval Hearing? 20. What is the difference between objecting to the settlement and asking to be excluded from it? THE COURT S FINAL APPROVAL HEARING PAGE When and where will the Court decide whether to approve the settlement? 22. Do I have to come to the hearing? 23. May I speak at the hearing? IF YOU DO NOTHING PAGE What happens if I do nothing at all? GETTING MORE INFORMATION PAGE How do I get more information? Page 3 of 9

4 BASIC INFORMATION 1. Why was this Notice issued? A court authorized this Notice because you have a right to know about the proposed settlement of this class action lawsuit. This Notice explains the lawsuit, the settlement, your legal rights and options, what benefits are available, and who can get them. Judge Ronald F. Frazier of the Superior Court of California, San Diego County is overseeing this class action. The case is known as McDuffee, et al. v. Sports Warehouse, Case No CU-BT-NC (the Action ). The person who filed this lawsuit is called the Plaintiff and the company he sued, Sports Warehouse, is called the Defendant. 2. What is this lawsuit about? The lawsuit alleges that Sports Warehouse engaged in a scheme of false price comparison advertising during the period beginning from January 17, 2013 through October 23, Plaintiff claims that Sports Warehouse s conduct violated California law prohibiting advertising goods for sale as discounted from former prices which are false and prohibiting misleading statements about the existence and amount of price reductions. Plaintiff alleges claims on a class basis for the following causes of action: (1) Violation of California s Unfair Competition Law ( UCL ), California Business & Professions Code section 17200, et seq., (2) Violation of California s False Advertising Law, Cal. Bus. & Prof. Code 17500, et seq. ( FAL ), (3) Violation of California s Consumers Legal Remedies Act, California Civil Code 1750, et seq. ( CLRA ), (4) Breach of Contract, (5) Breach of Express Warranty, and (6) Unjust Enrichment. Sports Warehouse denies that it used false comparison advertising, denies allegations of wrongdoing or liability, and denies that the Plaintiff or the class has been harmed in any way. 3. What is a class action? In a class action, one or more people called class representatives sue on behalf of other people with similar claims. Together, these people are called a class or class members. One court resolves the issues for all class members, except for those who exclude themselves from the Settlement Class, as explained below. 4. Why is there a settlement? The Court did not decide in favor of the Plaintiff, the Settlement Class, or Sports Warehouse. Instead, the parties agreed to a settlement. This way, they avoid the cost and burden of a trial and the people affected can get benefits. After diligent investigation and two mediation sessions, Plaintiff and his attorneys believe the settlement is the best outcome for all Settlement Class Members. The Court has granted preliminary approval of the settlement. WHO IS INCLUDED IN THE SETTLEMENT 5. How do I know whether I am part of the settlement? You are included in the settlement as a Settlement Class Member if you (1) purchased merchandise from Sports Warehouse that was advertised with a price comparison (2) were a citizen of the State of California at the time of the purchase, and (3) made your purchase between January 17, 2013 and October 23, 2017 (the Settlement Class Period ). Page 4 of 9

5 THE SETTLEMENT BENEFITS WHAT YOU GET IF YOU QUALIFY 6. What does the settlement provide? Sports Warehouse has agreed to pay $3,000,000 into a fund (the Settlement Fund ) to be used, in part, to make payments to members of the Settlement Class who submit approved Claim Forms. This amount also includes courtapproved reasonable attorneys fees and costs, the class representative enhancement payment, and the notice and administration costs. After deducting Court-approved attorneys fees and costs; enhancement payment to the Class Representative; and the costs of settlement notice and administration, the balance of the Settlement Fund called the Net Settlement Fund will be distributed to Settlement Class Members who submit valid and timely Claim Forms. In addition to the Settlement Fund provided to members of the Settlement Class, and as a direct result of this Action, Sports Warehouse agrees to comply with certain injunctive relief, change its business practices, and implement a compliance program. Sports Warehouse has incurred in excess of $160,000 by, among other things, modifying software programs and related websites, investigating its advertisement practices, training employees, and retaining consultants. Moreover, Sports Warehouse has stopped using price comparison advertisements in selling its products. As a further direct result of this action, to the extent that Sports Warehouse decides to use price comparison advertisements in the future, it will implement a compliance program, which will consist of periodic (no less than once a year) monitoring, training, and auditing to ensure compliance with Federal and California price comparison laws. The value of this compliance program is estimated at an additional $250,000 over a ten-year period. 7. How much will my payment be? The Net Settlement Fund shall be made available to Settlement Class Members who submit valid and timely Claim Forms ( Authorized Claimants ). The Claims Administrator will review Sports Warehouse s sales and transactions data to calculate the total number of compensable qualifying purchases for all known and identifiable Settlement Class Members during the Settlement Class Period. The respective number of compensable qualifying purchases for each Settlement Class Member will then be divided by the total compensable qualifying purchases for all Settlement Class Members, resulting in a payment ratio for each Settlement Class Member. Each Settlement Class Member s payment ratio will then be multiplied by the Net Settlement Fund to determine his or her estimated settlement payment from the Net Settlement Fund. If not all Settlement Class Members submit timely and valid Claim Forms, then the settlement payments to each Authorized Claimant shall be increased pro rata based on his or her number of compensable qualifying purchases. Authorized Claimants may elect to receive their individual settlement payments either as a cash payment by check or by ACH/direct deposit. An option to make the election between check or ACH/direct deposit will be provided on the Claim Form. To summarize, the amount of your cash payment will be determined based on the total number of qualifying purchases you made during the Settlement Class Period in relation to the total number of qualifying purchases made by all Settlement Class Members during the Settlement Class Period who submit approved Claim Forms. HOW TO GET A SETTLEMENT PAYMENT SUBMITTING A CLAIM FORM 8. How do I get a payment from the settlement? To qualify for payment, Settlement Class Members must submit a Claim Form. A Claim Form is accessible by clicking HERE. Read the instructions on the Claim Form carefully, fill out all the information requested, and submit it Page 5 of 9

6 electronically by 11:59 p.m. Pacific Time on May 21, You will need your passcode and CPT ID number provided on your or postcard notice to access and submit your Claim Form. 9. When would I get my settlement payment? The Court will hold a final approval hearing on June 15, If the Court approves the settlement and there are no appeals, settlement payments will be distributed within thirty (30) days. However, it is always uncertain whether appeals will be filed and, if so, how long it will take to resolve them. Settlement payments will be distributed as soon as possible, after the Court grants final approval to the settlement and any appeals are resolved. 10. What rights am I giving up to get a payment and stay in the Settlement Class? Unless you exclude yourself (opt-out), you are staying in the Settlement Class. If the settlement is approved and becomes final, all of the Court s orders will apply to you and legally bind you. You will not be able to sue or continue to sue Sports Warehouse about the legal issues resolved and released by this settlement. 11. What claims are being released? Upon entry of the final approval order, all Settlement Class Members who did not opt-out of the settlement, for and in consideration of the terms and undertakings herein, the sufficiency and fairness of which are acknowledged, release and forever discharge Sports Warehouse (and each of its current and former parents, subsidiaries, affiliates, controlled companies, officers, directors, shareholders employees, predecessors, successors, assigns, insurers, and attorneys ) (the Released Parties ) from any and all claims, demands, debts, liabilities, actions, and causes of action of every kind and nature, actual or potential, suspected or unsuspected, direct or indirect, contingent or fixed, that were asserted in the Action, or that could have been asserted but were not asserted in the Action or in any other court or forum, whether known or unknown, on the basis of, connected with, arising out of, or related in whole or in part to any or all of the alleged acts, omissions, facts, matters, transactions, circumstances, and occurrences that were alleged, asserted, described, set forth or referred to in the Action, whether such allegations were or could have been based on common law or equity, or on any statute, rule, regulation, order, or law, whether federal, state, or local, including, without limitation, claims under federal or state unfair competition and false advertising laws as pertains to the Released Parties between January 17, 2013 to October 23, 2017 (the Released Claims ). More detail about the claims you will be releasing, including the provisions of California Civil Code 1542 is described in Section 11 of the Settlement Agreement available at THE LAWYERS REPRESENTING YOU 12. Do I have a lawyer in this case? Yes. The Court has ordered that CounselOne, P.C. ( Class Counsel ) shall represent the interests of Settlement Class Members. This law firm and their lawyers are experienced in handling similar cases. You will not be charged for these lawyers. If you want to be represented by your own lawyer, you may hire one at your own expense. 13. How will the lawyers be paid? Class Counsel will request the Court for an award of attorneys fees of up to 33-1/3 percent of the Settlement Fund and actual costs of up to $30,000 from the Settlement Fund. The Court will make the final decision as to the amount to be paid to Class Counsel. Page 6 of 9

7 14. How much will the Class Representative receive for his efforts in bringing this Action? The Class Representative will request a service award of up to $5,000 from the Settlement Fund for his services as class representative and his efforts in bringing and helping to prosecute the Action. The Court will make the final decision as to the amount to be paid to the Class Representative. EXCLUDING YOURSELF FROM THE SETTLEMENT If you want to keep the right to sue or continue to sue Sports Warehouse about the legal claims in this case, and you do not want to receive a payment from this settlement, you must take steps to get out of the settlement. This is called excluding yourself from or opting out of the settlement. 15. How do I exclude myself from the settlement? To exclude yourself from the settlement, you must submit a written request for exclusion by first-class U.S. mail. Your request for exclusion must contain: (1) the words Request for Exclusion at the top of the document; (2) the name of this lawsuit (McDuffee, et al. v. Sports Warehouse); (3) your full name, address, postal address, and telephone number; (4) a statement with the following language: I request that I be excluded from the settlement in McDuffee, et al. v. Sports Warehouse, San Diego County Superior Court Case No CU-BT-NC. I understand that by requesting to be excluded from the Settlement Class, I am not entitled to receive any benefits under the settlement ; and (5) your signature. Your request for exclusion must be mailed to the Claims Administrator at the postal address below and postmarked no later than May 21, 2018: Sports Warehouse Settlement c/o CPT Group, Inc. 50 Corporate Park Irvine, CA You may not submit both a request for exclusion and a Claim Form and, if you submit both, the Claim Form will govern. 16. If I exclude myself, can I still get a payment from this settlement? No. If you exclude yourself, you are telling the Court that you do not want to be part of the settlement. You can only get a payment if you stay in the settlement and submit a valid and timely Claim Form. 17. If I do not exclude myself, can I sue Sports Warehouse for the same legal claims later? No. Unless you exclude yourself, you are giving up the right to sue Sports Warehouse for the claims that this settlement resolves and releases, and which are more thoroughly discussed in Question 11 above. You may also review more details about the released claims in the Settlement Agreement (section 11) available at OBJECTING TO THE SETTLEMENT If you have any objections to the settlement, you can tell the Court that you do not agree with the settlement or any part of it. Page 7 of 9

8 18. How do I tell the Court that I do not agree with the settlement? If you are a Settlement Class Member, you can object to the settlement if you do not agree with it or a portion of it. You can give reasons why you think the Court should not approve it. The Court will consider your views. Your objection must be in writing and contain: (1) the word Objection at the top of the document; (2) the name of this lawsuit (McDuffee, et al. v. Sports Warehouse, Case No CU-BT-NC); (3) your name, postal address, and telephone number; (4) a statement indicating that you have reviewed the definition of Settlement Class, you understand you are a Settlement Class Member, and you have not opted out of the Settlement Class; (5) the reasons why you object to the settlement, including any supporting documents; (6) a list of any other class action settlements (in the past five years) in which you have filed an objection; (7) a statement indicating whether you or your attorney intend to appear at the Court s Final Approval Hearing; and (8) your signature. You must file your written objection with the Court on or before May 21, You must also serve your written objection by mail on Class Counsel and Defense Counsel to the addresses below so it is postmarked on or before May 21, If you do not timely file and serve your objection, you will be deemed to have waived all objections and will not be entitled to speak at the Final Approval Hearing. Class Counsel Anthony J. Orshansky Justin Kachadoorian Scott E. Brown CounselOne, P.C Wilshire Boulevard Suite 650 Beverly Hills, CA Defense Counsel Alejandro S. Angulo Bradley A. Chapin Golsa Honarfar Rutan & Tucker, LLP 611 Anton Boulevard, 14th Floor Costa Mesa, CA May I come to Court to speak about my objection at the Final Approval Hearing? Yes. At the Final Approval Hearing, the Court will be available to hear any objections and arguments concerning the fairness of the settlement. As described above, you or your attorney may, but do not have to, speak at the Final Approval Hearing. However, if you or your attorney intend to speak at the Final Approval Hearing, you may only do so if (a) you have timely filed your written objection with the Court and timely mailed your written objection to Class Counsel and Defense Counsel and (b) followed the procedures set forth above for notifying the Court and counsel that you intend to speak at the Final Approval Hearing. If you have requested exclusion from the settlement, however, you may not speak at the Final Approval Hearing. 20. What is the difference between objecting to the settlement and asking to be excluded from it? Objecting is simply telling the Court that you do not agree with something about the settlement. You can object only if you remain a Settlement Class Member (that is, do not exclude yourself). Excluding yourself is telling the Court that you do not want to be part of the settlement. If you exclude yourself, you cannot object because the settlement no longer affects you. Page 8 of 9

9 THE COURT S FINAL APPROVAL HEARING The Court will hold a hearing to decide whether to approve the settlement. You may attend and you may ask to speak, but you do not have to. 21. When and where will the Court decide whether to approve the settlement? The Court will hold a Final Approval Hearing at 1:30 p.m. on June 15, 2018 in Dept. N-29 at the San Diego Superior Court, North County Regional Center, 325 South Melrose Drive, Vista, CA At this hearing, the Court will consider whether the settlement is fair, reasonable and adequate. It will also consider whether to approve Class Counsel s request for an award of attorneys fees and costs, as well as the Class Representative s enhancement payment. If there are objections, the Court will consider them. Hon. Ronald F. Frazier will listen to people who have asked to speak at the hearing. After the hearing, the Court will decide whether to approve the settlement. 22. Do I have to come to the hearing? No. Class Counsel will answer any questions Judge Frazier may have. However, you are welcome to come to the hearing at your own expense. If you send an objection, you do not have to come to court to talk about it. As long as you filed and served your written objection on time and followed the procedures set forth above for notifying the Court and counsel that you intend to speak at the Final Approval Hearing as set forth in Question 18 and 19, above, the Court will consider it. You may also pay your own lawyer to attend, but it is not necessary. 23. May I speak at the hearing? Yes. To do so, you must appear at the time and place set by the Court for the final hearing as set forth in Question 21, above. In the event that the Court changes the time or location of the hearing, that information will be posted on the Website at What happens if I do nothing at all? IF YOU DO NOTHING If you are a Settlement Class Member and you do nothing, you will give up the rights explained in Question 11, above, about the legal issues resolved by this settlement and released by the Settlement Agreement. In addition, you will not receive a payment from the settlement. 25. How do I get more information? GETTING MORE INFORMATION This Notice summarizes the proposed settlement. Complete details are provided in the Settlement Agreement. The Settlement Agreement and other related documents are available at Please the Claims Administrator at SportsWarehouseSettlement@cptgroup.com or contact Class Counsel at (310) with any questions. Publicly-filed documents can also be obtained by visiting the San Diego Superior Court, North County Regional Center, located at 325 South Melrose Drive, Vista, CA 92081, during business hours. The Clerk will tell you how to obtain the file for inspection and copying at your own expense. QUESTIONS? VISIT OR SEND AN TO SPORTSWAREHOUSESETTLEMENT@CPTGROUP.COM Page 9 of 9