Settlement Allows Claim Review Instead of Monetary Relief

In a series of recent opinions, the Eleventh Circuit upheld the settlement of a nationwide class action against a home warranty company in Faught v. American Home Shield Corp. Faught addresses various class-settlement issues, including the permissibility of non-monetary relief that provides for a re- review of denied claims by the defendant, the availability of multiple forms of attorney fees to class counsel, and injunctions against competing suits by opt-out class members.

Several months prior to the filing Faught, different counsel filed Edleson v. American Home Shield of California, Inc., No. 37-2007-071725-CU-BTCTL, in the Superior Court of California, County of San Diego. In both cases, a putative nationwide class asserted claims against American Home Shield Corp. (AHS) or its subsidiary. AHS offers homeowners home warranty contracts that cover the repair or replacement of various home systems or appliances specified under the contracts. While the putative class in Edleson was more broadly defined, both putative classes challenged several of AHS’s business practices, focusing primarily on the allegedly routine wrongful denial of claims.

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