On The Case

Lead plaintiff in $9.5 mln Walmart class action says Morgan & Morgan settled without telling him

(Reuters) - A Florida man named Vassilios Kukorinis is a big part of the reason why Walmart agreed this summer to a $9.5 million class action settlement in federal court in Miami. Kukorinis is a Walmart shopper who became concerned about overcharges: According to him, Walmart’s charges at the register exceeded what prices should have been based on the store’s posted prices-by-weight. Kukorinis visited Walmart stores around the state to document this alleged disparity, then brought his evidence to class action lawyers at Morgan & Morgan.

Morgan & Morgan dispatched its investigators to Walmart stores to check out Kukorinis’ allegations. In February 2019, the firm filed a class action complaint with Kukorinis as the prospective lead plaintiff. In November 2019, Kukorinis flew to California with Morgan & Morgan lawyers for a mediation session with Walmart.

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Morgan & Morgan subsequently reached a settlement with Walmart’s lawyers at Greenberg Traurig. Though Walmart did not admit to the class’ allegations, it agreed to pay at least $4.5 million and as much as $9.5 million to class members who were allegedly overcharged. Morgan & Morgan moved for preliminary approval of the settlement in August. U.S. District Judge Jose Martinez of Miami granted the motion just two weeks later. The deal called for Morgan & Morgan to be paid as much as $2.375 million in attorneys’ fees and for Kukorinis to receive a $25,000 award for his service to the class.

But Kukorinis didn’t know Morgan & Morgan had settled the case at all. Or, at least, that’s what he said in a 25-page letter he sent to Judge Martinez. Kukorinis said in the Sept. 22 letter, which was entered in the case docket on Sept. 25, that Morgan & Morgan reached the proposed settlement without his knowledge or consent.

“Morgan & Morgan’s duties were to keep (Kukorinis) reasonably informed of the status of this matter,” Kukorinis told the judge. “Unfortunately, the plaintiffs’ attorneys (failed) to keep this promise.” Kukorinis said he had not heard from class counsel at Morgan & Morgan since January 2020. He said he had not been “informed, participated or updated” after that and only found out about Judge Martinez’s preliminary approval of the settlement because he happened to search for the name of his case on Google.

“I am refusing to accept the agreed service award money,” Kukorinis said, “because I don’t want to participate to this fiasco/cover up and betrayal to all class action members, orchestrated without my knowledge.”

That’s a pretty dramatic statement. Class action skeptics constantly claim that these cases are driven by lawyers, not by the plaintiffs in case captions. But it’s quite rare indeed for a named plaintiff to allege that his lawyers cut him out of the resolution of the case. It’s especially notable in this class action, which only came to be because of Kukorinis’ conviction that he was being overcharged.

Here’s the thing, though: If you go to the case docket in Kukorinis v. Walmart, you won’t be able to see the Sept. 22 letter he sent to Judge Martinez. The judge issued an order sealing the letter on Sept. 28, citing a local rule that bars parties who have been represented by counsel from thereafter appearing on their own behalf without leave from the court. I was able to download the letter from a Docketbird link after I received a tip about the document from a class action lawyer who is not involved in the Walmart case but was disturbed that class members would not be able to see Kukorinis’ initial assertions.

It’s important to say here that John Yanchunis of Morgan & Morgan told me by email that Kukorinis was “was always informed of the progress and status” of the case, noting that the lead plaintiff traveled to the November 2019 mediation with class counsel. In response to my specific question about whether Morgan & Morgan sought Kukorinis’ consent before moving for preliminary approval of the settlement, Yanchunis said by email, “Yes, of course we did.”

The Morgan & Morgan lawyer did not respond to my followup question about why Kukorinis said in his letter to Judge Martinez that he had received no communication from class counsel since last January. I also asked Yanchunis if Kukorinis’ letter raises doubts about the adequacy of either the lead plaintiff or Morgan & Morgan to represent the interests of the class. He did not respond. Walmart counsel Mark Salky and Naomi Beer of Greenberg Traurig referred my query to a Walmart spokesman who declined to comment on the Kukorinis letter but said the company was glad to have reached a settlement in the case.

In the order sealing Kukorinis’ Sept. 22 letter, Judge Martinez called for an Oct. 7 status conference on the matter. Before the scheduled conference, Kukorinis submitted a second declaration, after consulting with Morgan & Morgan’s Yanchunis. Kukorinis said he had misunderstood the scope of the liability release in the settlement and now that Yanchunis had explained the release, he supported the settlement. Kukorinis’ second declaration did not address his initial assertion that Morgan & Morgan did not seek his consent before agreeing to the settlement and moving for its approval from the court.

There is still a chance that Judge Martinez will unseal the Sept. 25 letter. A purported class member who said in an Oct. 13 filing that he plans to object to the proposed settlement has asked the judge to release the letter. Walmart and Morgan & Morgan have jointly argued that Kukorinis’ letter improperly disclosed information about a confidential mediation as well as confidential discussions between him and his lawyers.

Morgan & Morgan, meanwhile, submitted its brief requesting attorneys’ fees on Oct. 14. The firm asked Judge Martinez to approve a fee of $2.375 million, as previewed in the settlement agreement. There’s been one big change, though: The 11th U.S. Circuit Court of Appeals barred incentive awards for lead class action plaintiffs in its Sept. 17 decision in Johnson v. NPAS Solutions. So Morgan & Morgan said it is no longer requesting that $25,000 service award for Kukorinis.