Case 18-10601-MFW K7E8GEIC 1 Doc 2884-2 2 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------x 3 LOUISETTE GEISS, et al., 4 Page 2 of 14 Plaintiffs, 5 6 Filed 07/21/20 v. 17 Cv. 9554 (AKH) THE WEINSTEIN COMPANY HOLDINGS, LLC, et al., 7 Defendants. Telephone Conference 8 ------------------------------x 9 July 14, 2020 10:00 a.m. 10 Before: 11 HON. ALVIN K. HELLERSTEIN, 12 District Judge 13 APPEARANCES 14 15 16 17 18 19 20 21 22 23 FEGAN SCOTT LLC Attorneys for Plaintiffs BY: ELIZABETH A. FEGAN -andHAGENS BERMAN SOBOL SHAPIRO LLP BY: STEVE W. BERMAN LEWIS BRISBOIS BISGAARD & SMITH LLP Attorneys for Defendant Harvey Weinstein BY: ELIOR D. SHILOH CRAVATH, SWAINE & MOORE LLP Attorneys for Defendant The Weinstein Company Holdings BY: PAUL H, ZUMBRO LETITIA JAMES Attorney General of the State of New York SANDRA PULLMAN Assistant Attorney General 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 1 Case 18-10601-MFW K7E8GEIC Doc 2884-2 Filed 07/21/20 Page 3 of 14 2 1 (The Court and all parties appearing telephonically) 2 THE COURT: 3 The first speaker will be either Elizabeth Fegan or 4 5 6 7 It is now 10:00. We shall proceed. Steve Berman. MS. FEGAN: Good morning, your Honor. This is Elizabeth Fegan on behalf of the nine class representatives. Your Honor, I would like to start with a brief intro 8 on how we got here, and then move to the terms of the 9 settlement, and then focus on Rule 23(b) and how we intend to 10 11 certify the subclasses. Your Honor, we represent the nine class 12 representatives who were sexually abused and harassed by Harvey 13 Weinstein. 14 because they know women exactly like them, women who today 15 still don't have a voice and are scared to come forward. 16 Each of them filed this class action lawsuit We were joined in our efforts by the New York State 17 Office of the Attorney General who filed a lawsuit for 18 violations of the state and city human rights laws. 19 We were also joined at the negotiating table and at 20 settlement by 16 women who filed individual lawsuits or claims 21 in the United States, Canada and the United Kingdom. 22 these women had every incentive to maximize the overall 23 recovery for the victims. 24 25 Each of This proposed settlement represents the culmination of a battle on a number of fronts which I would like to briefly SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC 1 Doc 2884-2 Filed 07/21/20 Page 4 of 14 3 review. 2 First, in this court, we went through several rounds 3 of motions to dismiss, and ultimately this Court dismissed all 4 defendants except Harvey Weinstein, dismissed all of the state 5 law claims for all plaintiffs, and only the Trafficking Victims 6 Protection Act claims survived, and only for those four 7 plaintiffs whose claims occurred post 2008. 8 plaintiffs' claims were dismissed. 9 was consistent with other courts in this district, including by All of the other And this Court's decision 10 Judge Abrams and Judge Engelmayer, Judge Sweet, all of whom 11 dismissed all of the officers and directors of the Weinstein 12 Company. 13 We also faced another front in the bankruptcy court. 14 On March 19, 2018, TWC and its subsidiaries filed a Chapter 11 15 proceeding in the District of Delaware. 16 effectively ceased operations. 17 Louisette Geiss, one of our class representatives, joined by 18 plaintiff Sandeep Rehal who has an individual case, they were 19 appointed to the Unsecured Creditors Committee when Louisette 20 served as one of the chairs. 21 At that time, TWC We were lucky enough that As part of that, we became privy to assets of the 22 company, or lack thereof, and the fact that over $250 million 23 in unsecured trade creditor claims were filed in the 24 bankruptcy, and that there is less 10 million in assets to 25 distribute to all unsecured creditors, which include both the SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC Doc 2884-2 Filed 07/21/20 Page 5 of 14 1 trade creditor claims as well as any women who were abused in 2 the TWC time period. 3 4 We have learned during that process the only real 4 assets of the company were insurance policies, and yet those 5 same insurance policies served as another front for our fight. 6 We have learned the insurance policies generally disclaimed 7 coverage for intentional torts, including molestation and 8 sexual abuse. 9 defendant, Harvey Weinstein, who obviously has his own issues. 10 The only thing left was the sole remaining And just to briefly review some of them, we know he is 11 fighting to appeal his convictions in New York. He is still 12 facing charges in Los Angeles and potentially a life sentence. 13 We understand that there is litigation against him to recover 14 on a secured loan of tens of millions of dollars which would 15 put that person in front of all of the women here. 16 understand that his ex-wives have frozen his assets in order to 17 secure them for their benefit and the benefit of his children. 18 Notwithstanding these barriers, both our clients, the We also 19 settlement class representatives, and the New York attorney 20 general were -- 21 THE COURT: In a bankruptcy setting with Harvey 22 Weinstein, do those other claims by his ex-wives have priority 23 against your claims? 24 25 MS. FEGAN: Harvey Weinstein himself has not filed for bankruptcy, your Honor. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC 1 2 THE COURT: Doc 2884-2 Filed 07/21/20 Page 6 of 14 I didn't ask that question. 5 Just answer my question. 3 MS. FEGAN: I believe so, your Honor. 4 THE COURT: The claim of a wife for alimony is a 5 higher priority than a claim of a creditor, is that what you're 6 saying? 7 8 MS. FEGAN: Your Honor, I am not sure of the answer to that question. 9 THE COURT: Why should I believe that anybody can 10 secure anything against your claims once you reduce them to a 11 judgment? 12 MS. FEGAN: Your Honor, I think I can say with 13 certainty that with respect to the secured loans and that 14 litigation, that those would have priority over our clients. 15 16 THE COURT: secured creditor. 17 18 But you say Harvey Weinstein is the MS. FEGAN: I am sorry. Harvey Weinstein -- right. He received the loan. 19 THE COURT: If he is the secured creditor, then that 20 claim can be subordinated. 21 believe that your clients will be prejudiced in a bankruptcy 22 setting if they had a claim. 23 MS. FEGAN: We can certainly provide more information THE COURT: I don't need more information. 24 25 There is no reason for me to on that. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Keep Case 18-10601-MFW K7E8GEIC 1 going. Doc 2884-2 You have 15 minutes. Filed 07/21/20 Page 7 of 14 6 Use it. 2 MS. FEGAN: Thank you, your Honor. 3 I would like to review the terms of the settlement. 4 Here, the settlement involves sexual misconduct claims 5 on behalf of two subclasses. 6 pre-June 30, 2005 subclass, and this is with respect to all 7 women who met Harvey Weinstein in the context of his role at 8 Miramax. 9 30, 2005, with respect to women who met Harvey Weinstein in his 10 11 The first subclass is the The post-2005 subclass is the later period, post June role as owner and founder of TWC. THE COURT: So let me ask you, if the statute of 12 limitations runs post 2008, why are we including in the claim 13 claims that arose before that date? 14 MS. FEGAN: Your Honor, there's two reasons. First, 15 women who have claims that are older than 2008 still have their 16 appeal rights and would exercise those appeal rights, as I am 17 sure Ms. Brock could attest to, when we got to judgment. 18 THE COURT: Haven't I dismissed those claims? 19 MS. FEGAN: You have dismissed those claims, your 20 Honor, but it's not ripe for appeal because there is not a 21 final judgment in the case. 22 THE COURT: 23 24 25 Why is there a distinction between pre- and post-6/30/05? MS. FEGAN: Because, your Honor, with respect to the pre 6/30/2005, we are not seeking a mandatory non-opt-out SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC Doc 2884-2 Filed 07/21/20 Page 8 of 14 7 1 class. 2 limited-fund class because Miramax and Disney and other 3 defendants are still a going concern and are not in bankruptcy. 4 So with respect to the pre-June 30, 2005 class, we are asking 5 the Court to certify the subclass under Rule 23(b)(3), which 6 would provide both notice, objection, and opt-out rights. 7 We are not alleging or contesting that it is a However, with respect to the post-June 30, 2005 class, 8 we are asking the Court to certify a limited subclass or a 9 mandatory non-opt-out class under Rule 23(b)(1). 10 THE COURT: We will get to that later, but I don't 11 believe you are going to succeed on a limited-fund subclass 12 basis. 13 it. I don't see any way I can do that, but we will get to 14 MS. FEGAN: OK. 15 THE COURT: The next question I have is, why should it 16 include women that just met Harvey Weinstein and were not 17 sexually molested? 18 right? 19 20 21 22 23 MS. FEGAN: Not every woman was sexually molested, We agree that not every woman was sexually molested. THE COURT: How could you have potential clients of women who just met and were not sexually molested? MS. FEGAN: Your Honor, it's our allegation that 24 because TWC and the other companies for which Harvey worked, 25 along with officers and directors, didn't stop or prevent or SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC Doc 2884-2 Filed 07/21/20 Page 9 of 14 8 1 put barriers in place to ensure he wouldn't continue, that all 2 of the women were in the zone of danger. 3 THE COURT: I have dismissed those cases. We are only 4 talking about Harvey Weinstein. 5 believe that a person who just met Harvey Weinstein has the 6 same claim as the person who is raped by Harvey Weinstein? 7 MS. FEGAN: What is there to make me Your Honor, based on our investigation and 8 the facts as we have alleged them, every woman who came in 9 contact with Harvey Weinstein was absolutely assessed by him to 10 determine whether she was vulnerable, to determine how he could 11 use her. 12 talked to dozens of women, both in the context of employment as 13 well as in the context of the industry itself. 14 I think we have seen this and we have certainly THE COURT: The fact that you have talked to dozens of 15 women doesn't mean to say that every women is similarly 16 situated. 17 greater recovery than women who just met Harvey Weinstein. 18 Women who have been raped are entitled to a much MS. FEGAN: We agree with that, your Honor. And 19 that's why we set up the claims process with allocation 20 guidelines that will allow a person to report to a special 21 master and to allow them to evaluate the totality of each 22 woman's circumstances. 23 24 25 THE COURT: How could I delegate to a non-Article III person the right to make judgments in an Article III case? MS. FEGAN: In the context of a class action SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC Doc 2884-2 Filed 07/21/20 Page 10 of 14 9 1 settlement, where the court oversees the process, oversees the 2 allocation guidelines, ensures that the special master is armed 3 with the information it needs as part of the claims process, 4 this is a role that has been given by Article III judges to 5 special masters in the context of a settlement, where we 6 believe it's appropriate here. 7 done in John Hopkins. 8 9 THE COURT: It was done in USC. It was I believe it's an abdication of the Court's responsibility. I don't believe the Supreme Court 10 following Hanken would ever allow a judge to abdicate 11 responsibility in that fashion. 12 and I wouldn't sign off to it. 13 Indeed, I think it's improper In the 9/11 settlements, there was a development and 14 pretrial discovery, on which I presided, which created a point 15 system in evaluating claims. 16 recognized and approved, and that then became the 17 administrative function of the settlement master. 18 nothing like that in this case. 19 interrogatories that created distinctions and entitlements 20 among plaintiffs, and I can't see how I could delegate that 21 function to somebody else who is not a judge. 22 23 24 25 MS. FEGAN: And that was judicially There is I have never had I won't. Your Honor, certainly we have reviewed the 9/11 case, and certainly if the Court would prefer -THE COURT: There is no way, Ms. Fegan, there is no way I would approve a delegation of that sort. Zero. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC 1 2 MS. FEGAN: Doc 2884-2 Filed 07/21/20 Page 11 of 14 10 Your Honor, do you have other questions for me that I can answer for you? 3 THE COURT: Rule 23 and its application. 4 MS. FEGAN: Your Honor, with respect to the Rule 23(a) 5 factors, would you like me to start with Rule 23(a)? 6 THE COURT: Why is there a limited fund? I understand 7 that you get a certain amount of the insurance recovery, and 8 you say that is the limited fund against which people can 9 claim. But that's not true. The only limited fund is Harvey 10 Weinstein. 11 It's possible Harvey Weinstein is bankrupt, but he hasn't filed 12 for protection. 13 fact, I don't think it is a limited fund. 14 There may be many claims against Harvey Weinstein. I don't know that it's a limited fund. In Furthermore, the idea that Harvey Weinstein can get a 15 defense fund ahead of a claimant's is obnoxious. 16 that you can regulate the claims of people not involved in the 17 settlement that have their own cases, I can't subscribe to 18 that. 19 MS. FEGAN: And the idea Your Honor, with respect to your latter 20 point, to the extent women had cases on file during the course 21 of negotiations and asked to be excluded, we have excluded them 22 from the settlement. 23 objections before you are excluded by the settlement's terms so 24 that they can continue to pursue their own litigation. 25 includes Dominique Huett, Wedil David, Kaja Sokola asked to be For many of the women that filed SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 That Case 18-10601-MFW K7E8GEIC Doc 2884-2 Filed 07/21/20 Page 12 of 14 11 1 excluded from the pre-2005 subclass so we did so. 2 Alexandra Canosa was also excluded as well as Ashley Judd and 3 Rose McGowan. 4 5 And THE COURT: Suppose they have second thoughts and want MS. FEGAN: Your Honor, that has always been part of to join? 6 7 the negotiations on the table, and certainly if they decided to 8 join the class -- 9 10 THE COURT: excluded. 11 They can't because they have been The definition excludes them. Why in this case where the individual claims are 12 measured by the depravity that a particular woman suffered does 13 not outweigh the common claims? 14 in the same way. 15 blandishments, some subjected their bodies by force, some may 16 have done it willingly. 17 settlement would create equality among all of those people. 18 This is not a case suitable for a class. Not every woman was captured Some gave up their bodies because of It's hard to describe. And yet your I told you 19 that many times. 20 forward not in a motion for class certification, but under the 21 umbrella of a settlement. 22 want to test me, make a motion. 23 And what you're doing is just putting this MS. FEGAN: This is not a class action. You Your Honor, I share your concerns and we 24 will obviously take them under advisement and wait for a trial 25 motion. SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC Doc 2884-2 All right. Filed 07/21/20 Page 13 of 14 12 1 THE COURT: I am going to do this. 2 First of all, is there anything else you want to say? 3 MS. FEGAN: No. 4 THE COURT: I don't want to cut you off. 5 MS. FEGAN: No. 6 THE COURT: Based on my study of the papers, based on Thank you, your Honor. Thank you. 7 my study of the objection papers, and based on what I have 8 heard, I will not give preliminary approval to the settlement. 9 And if you want to have a class, you should bring on a motion 10 11 for a class certification promptly. It would be more advisable to litigate the case for 12 your clients so they can change their concurrent claims into a 13 liquidated sum and therefore gets status in the bankruptcy, if 14 that's where you want to go, or execute upon Harvey Weinstein's 15 assets, if that's where they want to go. 16 judgment, you could immediately execute, unless Harvey 17 Weinstein posts a superseding bond. 18 pursue many remedies. 19 immediately available for execution. 20 doing instead of wasting your time with settlements and 21 attempts to create a class that doesn't exist. If you get a If he does, then you can If he doesn't, your judgment becomes That's what you should be 22 MS. FEGAN: Thank you, your Honor. 23 THE COURT: Is there anybody else who wants to speak? 24 I don't think there is any need for objections because 25 there is no point in making an objection to a settlement I am SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 Case 18-10601-MFW K7E8GEIC 1 Doc 2884-2 Page 14 of 14 not approving in light of the remarks I have made. 2 I think I can, unless there is objection, close this 3 meeting. 4 order that will follow. 5 Filed 07/21/20 I have made my decision. You will have a summary (Adjourned) 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300 13