On July 14, 2020, U.S. District Judge Alvin K. Hellerstein denied preliminary approval of a proposed $18.9 million settlement agreement brought on behalf of a group of victims of Harvey Weinstein’s alleged sexual abuse, labeling it a “phony settlement” and deriding certain terms of the deal as “obnoxious.”
The news comes just one day after Wigdor LLP filed a 36-page brief with the Court describing in detail numerous reasons why the proposed settlement agreement should be rejected. Wigdor LLP represents six alleged Harvey Weinstein survivors, including three women with pending civil claims against the disgraced movie mogul, and has been one of the most outspoken opponents of the proposed settlement agreement.
As set forth in the opposition brief, the proposed settlement would have allowed Harvey Weinstein to avoid paying any money towards the settlement fund or admitting wrongdoing. Rather, the proposed agreement sought to set aside approximately $15 million—likely far more than the proposed class of victims would have received under the deal—to Harvey Weinstein and the former Weinstein Company directors and executives who allegedly enabled his abuse, resulting in “one of the most one-sided and unfair class settlements in history,” according to the brief.
The brief also criticized the proposed settlement’s disparate treatment of non-settling plaintiffs; the agreement attempted to punish any woman who chose not to participate in the settlement by automatically providing a release of claims to the insurance companies and The Weinstein Company directors, severely limiting any potential recovery those women might have received in individual litigation. Moreover, the settlement agreement sought to pay $1.5 million for Harvey and Robert Weinstein’s continuing legal defense costs should any woman choose not to accept the deal, according to the brief.
The proposed settlement also diverted approximately $7.3 million to The Weinstein Company estate to cover administrative and general unsecured claims in the company’s bankruptcy proceeding, according to the brief. According to public records, among those unsecured creditors included Harvey and Robert Weinstein, other former Weinstein Company directors, lawyers, major corporations and famous actors.
The brief also outlined numerous deficiencies with the proposed Special Master process for evaluating claims and argued that the unfair and one-sided settlement agreement was the result of inadequate representation by class counsel and the Office of the New York State Attorney General.
During a court hearing, Judge Hellerstein reportedly took issue with the case being brought as a class action and said the settlement improperly attempted to regulate the claims of non-settling accusers. Judge Hellerstein also said, “the idea that Harvey Weinstein can get a defense fund ahead of the claimants is obnoxious,” according to reports.
“Based on my studies of the papers, based on my study of the objection papers, and based on the flaws that I have already noted, I will not give preliminary approval to the settlement,” Judge Hellerstein said, according to reports.
BREAKING: Wigdor LLP has filed a 36-page brief objecting to the patently unfair and one-sided class settlement with #HarveyWeinstein's victims that has been proposed in New York federal court.
We represent six victims of Weinstein's alleged sexual abuse. https://t.co/tW9Fj9S6fj
— WigdorLaw (@WigdorLaw) July 13, 2020
Statement from Wigdor LLP Partner Douglas H. Wigdor, Senior Associate Bryan L. Arbeit and Kevin Mintzer of The Law Office of Kevin Mintzer, P.C.:
“We have been saying for over a year and a half that the settlement terms and conditions were unfair and should never be imposed on sexual assault survivors. We were surprised that class counsel and the New York Attorney General did not recognize this fact but are pleased that Judge Hellerstein swiftly rejected the one-sided proposal. On behalf of our clients, we look forward to pursuing justice against Harvey Weinstein and his many enablers.”