Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 2 of 64

Transcription

1 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 2 of 64 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK BENJAMIN CAREATHERS, individually, and on Behalf of All Others Similarly Situated, vs. Plaintiff, Case No. 1:13-CV-0369 (KPF) RED BULL NORTH AMERICA, INC., a California corporation, Defendant. DAVID WOLF and MIGUEL ALMARAZ, individually and on behalf of others similarly situated, v. Plaintiffs, Case No. 1:13-CV (KPF) RED BULL GMBH, a foreign company; RED BULL NORTH AMERICA, INC., a California corporation; and RED BULL DISTRIBUTION COMPANY, INC., a Delaware corporation, Defendants. STIPULATION OF SETTLEMENT 1

2 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 3 of 64 This Stipulation of Settlement is made and entered into by and among Plaintiff Benjamin Careathers, individually and on behalf of himself and each of the Settlement Class Members, by and through Class Counsel authorized to settle Careathers v. Red Bull North America, Inc., et al, Case No. 1:13-CV-0369 (S.D.N.Y) (the New York Action ) on their behalf, Plaintiffs David Wolf and Miguel Almaraz, individually and on behalf of themselves and each of the Settlement Class Members, by and through Class Counsel authorized to settle Wolf v. Red Bull GmbH, et al., originally filed in the Central District of California, Case No. CV (the California Action ) but subsequently transferred and consolidated with the New York Action, and Defendants Red Bull North America, Inc., Red Bull Distribution Company, Inc., and Red Bull GmbH (collectively, Red Bull Defendants, Defendants or Red Bull ), by and through their counsel of record in the New York and California Actions (collectively, the Actions ). 1 I. RECITALS A. Plaintiffs Careathers, Wolf and Almaraz are collectively referred to herein as Plaintiffs. B. Defendants and Plaintiffs are collectively referred to herein as the Settling Parties. C. The New York Action was initiated on January 16, 2013 by Plaintiff Benjamin Careathers against Defendants in the United States District Court for the Southern District of New York. Pursuant to the Individual Practices of Judge Marrero (who previously presided over the New York Action), Careathers and Defendants exchanged letters regarding the sufficiency of the allegations of the Complaint. Careathers filed his Amended Complaint on April 1, 2013, asserting claims on behalf of a putative nationwide class of Red Bull purchasers and challenging 1 Although Plaintiff Careathers has dismissed without prejudice his claims against Red Bull Distribution Company and Red Bull GmbH pursuant to a prior stipulation between the Settling Parties, this Stipulation of Settlement applies to all Red Bull Defendants. 2

3 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 4 of 64 Red Bull s marketing and labeling that describe the functional benefits of Red Bull energy beverages. Careathers asserted claims against Red Bull for breach of express warranty, unjust enrichment, and violations of various states consumer protection statutes, seeking both monetary and injunctive relief. D. Subsequent to this filing, Careathers and Defendants met and conferred in an effort to settle this litigation without trial, and entered into a Memorandum of Understanding on June 24, E. The California Action was initiated on February 27, 2013 by Plaintiffs David Wolf and Miguel Almaraz against Defendants in the United States District Court for the Central District of California. These Plaintiffs also assert claims on behalf of a putative nationwide class of Red Bull purchasers based on substantially the same alleged misconduct at issue in the New York Action. The California Action brings causes of action for violations of California consumer protection statutes and unjust enrichment, alleging, for example, that Red Bull, through its marketing and labeling, has misrepresented both the functionality and safety of Red Bull beverages. F. Counsel for the Settling Parties engaged in three-way mediation in Los Angeles on June 24, 2013 and in New York on July 12, 2013, before JAMS mediator Hon. Peter D. Lichtman (Ret.). The Settling Parties engaged in good faith, arms -length negotiations and after more than 12 hours of mediation, the Settling Parties reached agreement on a settlement proposal presented by Judge Lichtman, the terms of which were memorialized in an October 24, 2013 Memorandum of Understanding signed by Defendants and Plaintiffs in both the New York Action and California Actions, expressly superseding the June 24, 2013 Memorandum of 3

4 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 5 of 64 Understanding in the New York Action. The terms of the settlement are laid out in greater detail herein. G. Pursuant to the October 24, 2013 Memorandum of Understanding, the California Action was transferred to this Court on November 12, 2013 and consolidated with the New York Action by order of this Court on December 20, H. Class Counsel (as defined below) conducted independent examinations and evaluations of the relevant law and facts relating to the matters alleged in the pleadings to assess the merits of Plaintiffs claims and to determine how to best serve the interests of the members of the putative class. I. The Settling Parties agreed to settle the New York Action and the California Action (collectively, the Actions ) pursuant to the provisions of this Stipulation after considering, among other things: (1) the substantial benefits available to the putative class under the terms of this Stipulation; (2) the attendant risks and uncertainty of litigation, especially in complex actions such as this, as well as the difficulties and delays inherent in such litigation; and (3) the desirability of promptly providing effective relief to Plaintiffs and the putative class. J. Red Bull has expressly denied and continues to deny all charges of wrongdoing or liability against it arising out of or relating to any of the conduct, statements, acts or omissions alleged, or that could have been alleged, in the Actions or any other actions, and believes it has meritorious defenses and legal challenges to Plaintiffs claims raised in the Actions. Red Bull further contends that, for any purpose other than settlement, the Actions are not appropriate for any form of class treatment. Nonetheless, Red Bull recognizes the uncertainty, risks, expenses, and time investment inherent in such litigation, and has concluded that it is desirable and 4

5 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 6 of 64 beneficial that the Actions be fully and finally settled in the manner and upon the terms and conditions set forth in this Stipulation. K. The Settling Parties agree that, for purposes of settlement only, a class action settlement is the superior and fair way to resolve this matter, as certifying a class in one proceeding pursuant to Rule 23 of the Federal Rules of Civil Procedure will resolve the claims of numerous potential plaintiffs, or potentially even multiple classes in different litigation in different jurisdictions, in one proceeding, without the inherent risks and expense of piecemeal and protracted litigation. L. The determination of the terms and conditions contained herein and the draft of the provisions of this Stipulation has been by mutual understanding after good faith, arms -length negotiations (including, but not limited to, the above-described mediation) with consideration by, and participation of, the Settling Parties and their counsel. The Settling Parties agree that the drafting of this Stipulation has been a mutual undertaking. M. This Stipulation effectuates the resolution of disputed claims and is for settlement purposes only. II. DEFINITIONS A. As used in this Stipulation the following capitalized terms have the meanings specified below: 1. Cash Fund means the interest-bearing account funded by Red Bull for distributions of cash reimbursements as part of the Distribution Fund and Settlement Fund, as discussed in IV.A.5 of this Stipulation. 2. Claim means a request for relief by a Settlement Class Member on a Claim Form submitted to the Class Action Settlement Administrator in accordance with the terms of this Stipulation. 5

6 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 7 of Claim Form means the document to be submitted by Claimants seeking cash payment or products pursuant to this Stipulation that will accompany the Class Notice and will be available online at the Settlement Website. The Claim Form will be substantially in the form of Exhibit A to this Stipulation. 4. Claimant means a Settlement Class Member who submits a Claim for cash payment or products. 5. Class Action Settlement Administrator means the company jointly selected by Class Counsel and Defendants Counsel and approved by the Court to provide Class Notice and to administer the claims process: the Garden City Group. 6. Class Counsel means: Attorneys for Plaintiff Careathers: MORELLI ALTERS RATNER, LLP 777 Third Avenue, 31 st Floor New York, NY Telephone: (212) Facsimile: (212) Benedict P. Morelli bmorelli@morellialters.com David S. Ratner dratner@morellialters.com Adam Deutsch adeutsch@morellialters.com MORELLI ALTERS RATNER, LLP Miami Design District 4141 Northeast 2nd Avenue, Suite 201 Miami, Florida Telephone: (305) Facsimile: (305) Jeremy W. Alters jalters@morellialters.com Matthew T. Moore mmoore@morellialters.com Attorneys for Plaintiffs Wolf and Almaraz: KAPLAN FOX & KILSHEIMER LLP 350 Sansome Street, Suite 400 San Francisco, CA Telephone: (415) Facsimile: (415) Laurence D. King lking@kaplanfox.com Linda M. Fong lfong@kaplanfox.com KAPLAN FOX & KILSHEIMER LLP 850 Third Avenue, 14 th Floor New York, New York Telephone: (212) Facsimile: (212) Frederic S. Fox ffox@kaplanfox.com KAPLAN FOX & KILSHEIMER LLP Santa Monica Boulevard, Suite 620 Los Angeles, CA

7 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 8 of 64 Tel.: (310) Fax: (310) Justin B. Farar jfarar@kaplanfox.com 7. Class Notice means, collectively, the Notice of Class Action Settlement and the Publication Notice, substantially in the forms of Exhibit B and Exhibit C, respectively. 8. Class Period means from January 1, 2002 up to and including the date Class Notice is provided to the Settlement Class Members. Wolf and Miguel Almaraz. New York. 9. Class Representatives means Plaintiffs Benjamin Careathers, David 10. Court means the United States District Court for the Southern District of 11. Defendants Counsel means: SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 300 South Grand Avenue, Suite 3400 Los Angeles, CA Telephone: (213) Facsimile: (213) Jason D. Russell jason.russell@skadden.com Hillary A. Hamilton hillary.hamilton@skadden.com SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP Four Times Square New York, NY Telephone: (212) Facsimile: (917) Kenneth A. Plevan kenneth.plevan@skadden.com Jordan A. Feirman jordan.feirman@skadden.com 12. Distribution Fund means the amount remaining in the Settlement Fund following the payment of all applicable Notice Expenses, and administration and tax expenses (i.e., the aggregate amount of value made available to the Settlement Class for distribution as cash reimbursements and free direct-shipped products, and, if applicable, charitable donations as 7

8 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 9 of 64 a cy pres remedy). It is expressly agreed and understood that the entirety of the Distribution Fund shall be paid out to Claimants, except that a cy pres donation, if any, shall be made in the event and to the extent there are checks for reimbursements not cashed by Claimants as provided in IV.A.10 below. 13. Effective Date means the date on which all of the conditions of settlement have been satisfied, as discussed in IX.A of this Stipulation. 14. Final Approval Hearing means the hearing(s) to be held by the Court to consider and determine whether the proposed settlement of the Actions as contained in this Stipulation should be approved as fair, reasonable, and adequate, and whether the Judgment approving the settlement contained in this Stipulation should be entered. 15. Judgment means the Final Order and Judgment to be entered by the Court in the Actions. 16. Marketing means all acts and practices of Red Bull and its affiliates calling public attention to Red Bull Products, including, but not limited to, advertising materials, billboards, point of sale materials, online posts, websites, and social media. 17. Net Settlement Balance means the remaining balance of the Cash Fund to be distributed as cash reimbursements after distributions are made for Notice Expenses and necessary taxes and tax expenses, as discussed in IV.A.5(b). 18. Notice Expenses means the costs reasonably and actually incurred by the Class Action Settlement Administrator in connection with providing notice to Settlement Class Members, and administering Claims pursuant to this Stipulation, as discussed in V.A Person means a natural person, individual, corporation, partnership, association, or any other type of legal entity. 8

9 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 10 of Preliminary Approval Order means the Order Granting Preliminary Approval of Class Action Settlement, substantially in the form of Exhibit D attached hereto, preliminarily approving this Stipulation, providing for notification to the Settlement Class of the proposed settlement, and scheduling of the Final Approval Hearing. 21. Products or Red Bull Products means the energy beverages marketed and distributed by Defendants under the brand name Red Bull, including any variations, formats or line extensions thereof. 22. Product Option means the option selected by valid Claimants on the Claim Form to obtain certain free Red Bull Products (either Red Bull Energy Drink or Red Bull Sugarfree) valued at the Retail Value of $15 or as close to that value as commercially reasonable (potentially subject to an increase or decrease in that value pursuant to IV.A.6 or IV.A.9 below). Product packaging (e.g. a four-pack) and sizing (e.g. 8.4 ounce cans) shall be determined by Red Bull at its discretion after the final value of the Product Option has been determined in accordance with IV.A. below. 23. Released Claims means any and all actions, claims, demands, rights, suits, and causes of action of any kind or nature whatsoever against the Released Persons, including damages, costs, expenses, penalties, and attorneys fees, whether at law or equity, known or unknown, foreseen or unforeseen, developed or undeveloped, direct, indirect or consequential, liquidated or unliquidated, arising under common law, regulatory law, statutory law, or otherwise, based on federal, state, or local law, statute, ordinance, regulation, code, contract, common law, or any other source, or any claim that Plaintiffs or Settlement Class Members ever had, now have, may have, or hereafter can, shall or may ever have against the Released Persons in any other court, tribunal, arbitration panel, commission, agency or before 9

10 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 11 of 64 any governmental and/or administrative body, or any other adjudicatory body, on the basis of, connected with, arising from or in any way whatsoever relating to the consumption, actions or omissions in manufacturing, advertising, marketing, labeling, packaging, promotion, sale and distribution of the Products, and/or any claims or omissions regarding any purported benefits, superiority, safety or qualities of the Products or their ingredients, or consumers experiences relating to the consumption of the Products, from January 1, 2002 to the Effective Date, including those which have been asserted or which could reasonably have been asserted by the Class against the Defendants in either of these Actions or any other threatened or pending litigation asserting claims of the nature encompassed by this Release, and any claims arising after the date of final approval which could be asserted based on labels or Marketing in existence as of the date of final approval of the Stipulation. For avoidance of doubt, personal injury claims unrelated to the marketing or labeling of Red Bull Products will fall outside the scope of Released Claims. 24. Released Persons means and includes Defendants and their subsidiaries and affiliates, parent companies, divisions, as well as their distributors, wholesalers, retailers, customers and licensors, including the officers, directors, trustees, employees, shareholders, agents, insurers, spokespersons, public relations firms, advertising and production agencies and assigns of all such Persons or entities. 25. Retail Value means the Manufacturer s Suggested Retail Price as of the date of delivery of the Red Bull Energy Drink or Red Bull Sugarfree products distributed in fulfillment of the Product Option to valid Claimants. 26. Settlement Class, Class, and/or Settlement Class Member(s) means all persons who purchased Red Bull Products in the United States during the Class Period. The 10

11 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 12 of 64 Class will cover all persons who could have been class members in either of the Actions. Specifically excluded from the Settlement Class are: (a) employees, officers, directors, agents, and representatives of (1) Defendants and each of their subsidiaries and affiliates, and (2) all distributors, wholesalers, retailers, and licensors of Red Bull Products; (b) those who purchased Red Bull Products for the purpose of re-sale; (c) all federal judges who have presided over either of the Actions; and (d) all Persons who have been properly excluded from the Settlement Class. 27. Settlement Fund means the thirteen million dollars ($13,000,000.00) in value provided by Red Bull that includes (i) applicable Notice Expenses and administration and tax expenses; (ii) distributions to Settlement Class Members as cash reimbursements (from the Cash Fund) and products distributed in fulfillment of the Product Option; and/or (iii) to the extent necessary, and in the limited circumstances described in IV.A.10 below, charitable donations as a cy pres remedy. The Settlement Fund does not include amounts awarded for attorneys fees and expenses, class representative incentive awards, or the significant value to the Settlement Class from changes to Red Bull Marketing and labeling. 28. Settlement Website means the website to be created for this settlement that will include information about the Actions and the settlement, and relevant documents and electronic and printable forms relating to the settlement, including the Claim Form which can be submitted online or printed and mailed. The Class Action Settlement Administrator shall consult the parties on the design and content of the Settlement Website, and the Settlement Website shall not become active without the parties prior written final approval as to, inter alia, appearance, subject matter, and/or content. Furthermore, if the name Red Bull and/or any Red Bull trade names or trademarks appear on the Settlement Website in any form, including in the domain name, the Settlement Website will be registered to Red Bull and Red Bull will license its use to 11

12 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 13 of 64 the Class Action Settlement Administrator (at no cost), so that Red Bull may maintain control of its trade names, trademarks and any other Red Bull intellectual property. The Settlement Website shall be active within thirty (30) days after the Preliminary Approval Order is entered and shall remain active until 101 days after the Court enters the Judgment. 29. Stipulation means this Stipulation of Settlement, including its attached exhibits (which are incorporated herein by reference), duly executed by Class Counsel and Defendants counsel. 30. Total Settlement Value is the sum of: (1) thirteen million dollars ($13,000,000.00) in monetary value of the Settlement Fund; (2) the significant value to the Settlement Class of the changes to Red Bull Marketing and labeling; and (3) the value of any and all other attorneys fees, incentive awards, costs, and expenses to be paid by Defendants as per this Stipulation. B. Other capitalized terms used in this Stipulation but not defined above shall have the meaning ascribed to them in this Stipulation and the exhibits attached hereto. III. CERTIFICATION OF THE NATIONWIDE SETTLEMENT CLASS Defendants hereby consent, solely for purposes of the settlement set forth herein, to the conditional certification of the Settlement Class on a nationwide basis, to the appointment of Class Counsel as counsel for the Settlement Class, and to the approval of Plaintiffs as Class Representatives; provided, however, that if this Stipulation, as drafted, fails to receive Court approval or otherwise fails to be consummated, including, but not limited to, a judgment not becoming final, then Defendants retain all rights they had immediately preceding the execution of this Stipulation and any preceding Memoranda of Understanding to object to the maintenance of the Actions as class actions by Class Counsel, and, in that event, nothing in this Stipulation or other papers or proceedings related to the settlement shall be used as evidence or argument, 12

13 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 14 of 64 admission, or waiver by any Settling Party concerning whether the Actions may properly be maintained as class actions, whether the purported class is ascertainable, whether the claims of Plaintiffs or any Settlement Class Member are in any way valid, or whether Class Counsel or Plaintiffs can adequately represent the Settlement Class Members. IV. SETTLEMENT RELIEF The settlement relief includes cash payments, products direct-distributed in fulfillment of the Product Option, potential cy pres charitable contributions, and non-monetary relief. The Settling Parties acknowledge that the Court will, for purposes of final approval, need to scrutinize the fairness of any settlement according to Rule 23 of the Federal Rules of Civil Procedure; the Grinnell factors for fairness (City of Detroit v. Grinnell Corp., 495 F.2d 448, 463 (2d Cir. 1974)); other applicable statutory and case authority; and any other factors the Court deems appropriate. A. Cash or Product Option Settlement Class Members who execute a valid and timely Claim Form, and are eligible pursuant to IV.A.13 below, may elect to receive either cash reimbursement (the Cash Option ) or certain free Red Bull Products (as described herein) (the Product Option ): 1. Notice Period: (a) Settlement Class Members shall have a notice period of 150 days from the issuance of the Class Notice ( Notice Period ) to make a Claim under either the Cash Option or Product Option. 2. Total Collective Value of the Cash and Product Options (a) The total collective value of all distributions by Defendants to Claimants of cash reimbursements or certain free Red Bull Products pursuant to this Stipulation shall be equal to the amount of the Distribution Fund (i.e., the Settlement Fund minus any 13

14 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 15 of 64 applicable Notice Expenses or administration or tax expenses payable by Red Bull), and under no circumstances shall exceed the total value of the Settlement Fund, thirteen million dollars ($13,000,000.00). 3. Cash Option (a) A Settlement Class Member choosing the Cash Option and submitting a valid and timely Claim Form shall be entitled to obtain a $10.00 cash reimbursement (potentially subject to an increase or decrease in that amount pursuant to IV.A.6 or IV.A.9 below) for Products purchased during the Class Period. (b) The Cash Option shall be made in the form of a check payable to the Settlement Class Member, which may be cashed for a period of up to 120 days after the issuance date of the check. 4. Product Option (a) A Settlement Class Member choosing the Product Option shall be entitled to receive either Red Bull Energy Drink or Red Bull Sugarfree products of $15.00 in Retail Value (potentially subject to an increase or decrease in that value pursuant to IV.A.6 or IV.A.9 below). Product packaging (e.g. a four-pack) and sizing (e.g. 8.4 ounce cans) shall be determined by Red Bull at its discretion after the final value of the Product Option has been determined pursuant to IV.A.6 through IV.A.9 below. Based on current market pricing and projected Retail Value, the parties believe that Settlement Class Members choosing the Product Option valued at $15.00 (assuming no increase or decrease in that value pursuant to IV.A.6 or IV.A.9 below) will obtain, for example, approximately two four packs of 8.4 ounce cans of Red Bull products, shipped by Red Bull directly to class members at Red Bull s cost, without any cash outlay by Class Members. Class Members will have the option on the Claim Form of 14

15 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 16 of 64 choosing either Red Bull Energy Drink or Red Bull Sugarfree but will not have the option of choosing the size of can or pack. (b) Red Bull will ship products to the Claimant selecting the Product Option at the addresses provided by the Class Action Settlement Administrator per IV.A.11(b), below. However, if shipment to a particular Claimant is not feasible or commercially reasonable, such as, for example, where the products would be shipped internationally and the cost to ship would exceed the products Retail Value, then Red Bull shall have the right to substitute the Cash Option instead of the Product Option for that particular Claimant. 5. Cash Fund (a) Cash reimbursements provided to valid Claimants shall be drawn from an interest-bearing fund in trust with a third party institution to be selected by Defendants and approved by Class Counsel (the Cash Fund ). (b) Within 7 days of the entry of the Order approving the Motion for Preliminary Approval, Red Bull shall make a payment of $6.5 million into the Cash Fund, which shall be applied in the following order of priority: (i) To reimburse or pay all of the Notice Expenses, as defined in V.A of this Stipulation. (ii) (iii) To pay any necessary taxes and tax expenses; From the remaining balance of the Cash Fund after the distributions are made under (a) and (b) above (the Net Settlement Balance ), to distribute cash reimbursements to authorized Claimants. (c) In the event the Effective Date does not occur, all amounts paid 15

16 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 17 of 64 into the Cash Fund, less amounts paid for Notice Expenses, taxes and tax expenses, shall be returned to Defendants. 6. Distribution Fund Insufficient To Cover All Claims In Full (a) If the aggregate value of valid Claims by Settlement Class Members for cash reimbursement and products required to fulfill the Product Option at the end of the Notice Period exceeds the Distribution Fund, then all cash reimbursements and products required to fulfill the Product Option shall be reduced pro rata. 7. Distribution Fund Sufficient To Cover All Claims In Full But Initial $6.5 Million Cash Fund Insufficient To Cover Claims Under The Cash Option (a) If, at the end of the Notice Period, (i) valid Claims by Class Members for cash reimbursement exceed the Net Settlement Balance and (ii) the aggregate value of all valid Claims by Class Members for cash reimbursement and products used to fulfill the Product Option does not exceed the Distribution Fund, then Red Bull shall immediately supplement the Cash Fund with any amount remaining in the Distribution Fund necessary to provide $10.00 cash reimbursements to all valid Claims made under the Cash Option. 8. Distribution Fund Sufficient To Cover All Claims In Full But Product Option Claims Exceed $6.5 Million: (a) If, at the end of the Notice Period, (i) valid claims by Class Members for free products exceed $6.5 million and (ii) the aggregate value of all valid Claims by Class Members for cash reimbursement and products required to fulfill the Product Option does not exceed the Distribution Fund, then the Cash Fund shall be reduced in the amount necessary to provide $15.00 in Retail Value of products to all valid Claims made under the Product Option. 9. Excess Amount In The Distribution Fund Following Distribution of Cash and Products in Full (a) Any remaining value in the Distribution Fund after all distributions 16

17 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 18 of 64 to valid Claimants are determined (irrespective of whether the initial $6.5 million Cash Fund required supplementation or was drawn upon to satisfy all valid Claims), shall be distributed on a pro rata basis to all Claimants who have submitted valid claims as either an addition to the cash payment or an addition to the products to be distributed in fulfillment of the Product Option, consistent with the election on their initial Claim Form. 10. Checks Not Cashed and Cy Pres (a) Once distribution of checks for cash reimbursement is made to Claimants as per IV.A.3(b) above, upon the expiration of the 120 day redemption window, there will be a determination by the Class Action Settlement Administrator of how many checks remain uncashed, and are therefore void. (b) If the total value of those uncashed checks is less than $100,000.00, such amount shall be donated by Defendants as a cy pres remedy to one or more charitable organizations to be mutually agreed upon by the parties, such that there shall be a final balance of zero in the Distribution Fund. (c) If the total value of those uncashed checks equals or exceeds $100,000.00, the unpaid checks will be cancelled and there will be a second distribution of checks, each in an amount determined on a pro rata basis, to those Claimants choosing the Cash Option who did cash their initial checks. (d) Checks issued in this second distribution may be cashed by Class Settlement Members for a period of up to 120 days after the issuance date of the check. Upon the expiration of this subsequent 120 day redemption window, there will be a determination of how many checks remain uncashed, and are therefore void. The value of any such voided checks after this second distribution shall be donated by Defendants as a cy pres remedy to one or more 17

18 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 19 of 64 charitable organizations to be mutually agreed upon by the parties, such that there shall be a final balance of zero in the Distribution Fund. 11. Delivery of Cash Payments and Products to Settlement Class Members (a) Payment for the Cash Option will be made directly to the Settlement Class Members by first class mail by the Class Action Settlement Administrator after entitlement to payment to all Claimants is determined. (b) At the conclusion of the Claims Period, the Class Action Settlement Administrator will be responsible for preparing and transmitting to Red Bull a list of valid Claimants selecting the Product Option, their selection of Red Bull Energy Drink or Red Bull Sugarfree, and valid shipping addresses for the Claimants. The Class Action Settlement Administrator shall be responsible for all communications with Class Members and for any errors in the addresses provided to Red Bull. Red Bull is not responsible for verifying the addresses provided by the Class Action Settlement Administrator. Products fulfilling the Product Option will be shipped directly to valid Claimants selecting the Product Option after entitlement to payment to all Claimants is determined, via a shipping method to be determined by Red Bull in its discretion. (c) Failure to provide all information requested in the Claim Form (so long as submitted within the Notice Period) will not result in nonpayment of a claim. Instead, the Class Action Settlement Administrator will take all adequate and customary steps to determine the Settlement Class Member s eligibility for payment based on the information contained in the Claim Form or otherwise submitted, the amount available to pay all valid claims, and such other reasonably available information from which eligibility for payment can be determined. 18

19 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 20 of Claim Form Availability The Claim Form will be part of the Publication Notice (discussed in V.B) and will be available for downloading and may be completed and submitted online at the Settlement Website, and, at Class Counsel s option, the Claim Form will be available for downloading on Class Counsel s website. The Claim Form may also be requested by calling a toll-free number provided by the Class Action Settlement Administrator or by writing to the Class Action Settlement Administrator, and may be submitted by mail to an address provided by the Class Action Settlement Administrator and listed on the Claim Form. 13. Eligibility for Cash or Products In Fulfillment Of Product Option (a) To be eligible for the Cash Option or Product Option, the Class Member must timely submit a Claim Form containing his or her name and mailing address, which attests, pursuant to 28 U.S.C under penalty of perjury, that the Class Member purchased one or more Red Bull Products in the United States during the Class Period. (b) Receipts will not be necessary to make a valid claim or submit a Claim Form. (c) To be eligible, Claim Forms must be postmarked or submitted online no later than one-hundred and fifty (150) days after the Notice Date. (d) Within 15 days after the end of the Notice Period, the Class Action Settlement Administrator shall provide to Class Counsel, Defendants, and Defendants Counsel a written accounting and distribution plan identifying: (i) (ii) (iii) the total number of valid Claims; each Claimant whose claim was approved; whether said Claimant chose the Cash Option or Product 19

20 Case 1:13-cv KPF Document 42-1 Filed 07/31/14 Page 21 of 64 Option; (iv) For each Claimant selecting the Product Option, that Claimant s selection of Red Bull Energy Drink or Red Bull Sugarfree; (v) valid shipping addresses for the Claimants selecting the Product Option; (vi) an estimated balance of the Cash Fund and any supplementation or withdrawals that will be required pursuant to IV.A.7 or IV.A.8, as the case may be; (vii) each Claimant whose claim was rejected; (viii) an accounting of all administration fees and expenses incurred by the Class Action Settlement Administrator to date. 14. Timing of Payments to Settlement Class Members (a) The Class Action Settlement Administrator shall send payment of a check in satisfaction of the Cash Option to eligible Settlement Class Members or, as applicable, a letter explaining the rejection of the claim for either cash or products fulfilling the Product Option, within 150 days after the Effective Date. As promptly as reasonably practicable following receipt of the list of valid Claimants selecting the Product Option, their selection of Red Bull Energy Drink or Red Bull Sugarfree, and valid shipping addresses for the Claimants from the Class Action Settlement Administrator, as per IV.A.11(b) above, Red Bull products fulfilling the Product Option will be shipped directly to valid Claimants selecting the Product Option at the addresses provided by the Class Action Settlement Administrator, via a shipping method to be determined by Red Bull in its discretion. 20