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US: Toys R Us’s $35.5M settlement halted over distribution issues

By  |  February 20, 2013

A $35.5 million class action settlement was put on hold on Tuesday by a federal appeals court in a case against baby product companies. According to reports, the 3rd US Circuit Court of Appeals in Philadelphia overturned a district court’s approval of the settlement over concerns about attorneys’ fees as well as the distribution-of-funds process. The settlement was reached in a class action suit against Toys R Us Inc. and baby product manufacturers after allegations the companies colluded to fix prices. The appeals court found that only $3 million of the $35.5 million settlement would actually land in the hands of consumers, while the rest would go to attorneys’ fees; about $18.5 million would be donated to a charity designated by the parties involved. According to the appeals court, the district court judge was unaware of this distribution.

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