Judge rejects $760 million NFL concussion settlement

The federal judge overseeing the multidistrict concussion litigation against

the National Football League denied on Tuesday the proposed preliminary settlement in the case, writing that she has reservations about the amount of dollars in the accord.

U.S. District Judge Anita Brody, sitting in the Eastern District of Pennsylvania, released a 12-page memorandum in which she stated that the $760 million figure may not be enough to compensate those former professional football players who say they were not adequately warned about the long-term health risks associated with on-the-field head trauma.

“I am primarily concerned that not all Retired NFL Football Players who ultimately receive a Qualifying Diagnosis or their related claimants will be paid,” Brody wrote. “In various hypothetical scenarios, the Monetary Award Fund may lack the necessary funds to pay Monetary Awards for Qualifying Diagnoses.”

Court papers show that about 20,000 individuals would be eligible to receive compensation under the settlement.

Brody wrote that the plaintiffs allege that their economists conducted analyses to ensure that sufficient funding would be available to pay benefits to all eligible class members given the size of the class and projected incidence rates, and that the plaintiffs’ lawyers “believe” that the aggregate sum is sufficient to compensate all retired NFL players who may receive qualifying diagnoses, but that “no such analyses were provided to me in support of the Plaintiffs’ Motion. “In the absence of additional supporting evidence, I have concerns about the fairness, reasonableness, and adequacy of the Settlement,” Brody wrote.

The judge did praise the parties for a “commendable effort to reach a negotiated resolution to this dispute,” and went on to write that there is nothing to indicate that the proposed settlement was not the result of “good faith, arm’s-length negotiations between adversaries.

“Nonetheless,” Brody wrote, “on the basis of the present record, I am not yet satisfied that the Settlement ‘has no obvious deficiencies, grants no preferential treatment to segments of the class, and falls within the range of possible approval.”

Brody also made clear that preliminary approval is “not simply a judicial ‘rubber stamp’ of the parties’ agreement.”

The judge cited precedence from the U.S. Third Circuit Court of Appeals that says, “In cases such as this, where settlement negotiations precede class certification, and approval for settlement and certification are sought simultaneously, we require district courts to be even ‘more scrupulous than usual’ when examining the fairness of the proposed settlement.”

The sides announced back in August that they had reached a proposed $765 million settlement in the case.

Brody, the judge overseeing the MDL, had earlier appointed retired U.S. District Judge Layn Phillips to serve as a mediator to handle the talks between the two camps.

Phillips had announced that the settlement would end the litigation against the NFL and NFL Properties and provide medical and other benefits, as well as cash dollars, to injured former players and their families.

The first lawsuits had started rolling in back in July 2011.

The plaintiffs and their spouses accused the defendants of breaching their duties to the players by failing to take reasonable actions to protect the athletes from chronic risks created by concussive and sub-concussive head injuries and that the NFL parties concealed those risks.

The growing lawsuits were soon consolidated into a multidistrict litigation and Brody was assigned by a federal judicial panel to handle all pre-trial matters.

Brody had directed the parties into mediation back in July, with Phillips assigned to oversee the talks.

During the course of the mediation, according to Brody’s recent memorandum, the two sides met with various medical, actuarial and economic experts to determine, develop and test an appropriate settlement framework to meet the needs of the retired players suffering from chronic injuries.

The two subclasses that made up the settlement class were retired players who were not diagnosed with a “qualifying diagnosis” prior to the date of class certification, and those who were diagnosed with injuries prior to that date.

The second subclass also consisted of representatives of deceased players who had been diagnosed with such diseases before death.

The settlement had the NFL making $760 million in payments to the class members over a two-decade period, with $675 million going into a monetary award fund that would award cash to retired players who already have a qualifying diagnosis or would receive one in the future.

The settlement also provided for a $75 million baseline assessment program that would offer eligible retired players baseline neuropsychological and neurological evaluations to determine the existence and extent of any cognitive defects.

It also would have set aside $10 million for an education fund to fund programs promoting safety and injury prevention with regard to football players, including safety-related initiatives in youth football.

Plaintiffs’ lawyers were asking $112.5 million in legal fees.

In her memorandum, Brody wrote that even if only 10 percent of retired players eventually receive a qualifying diagnosis, “it’s difficult to see how the Monetary Award Fun would have the funds available over its lifespan to pay all claimants at these significant award levels.”

The settlement contemplated a $675 million monetary award fund with a 65-year lifespan for the class of approximately 20,000 people, Brody noted.

The judge wrote that the current record “does not sufficiently address my concerns.