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Judicial Largesse

- November 30, 2007

Looking for funding for your favorite charity? Take a judge to lunch.

According to a recent New York Times story by Adam Liptak, judges have the power to direct left-over funds from class-action lawsuits to virtually any charitable organization they please — including (a popular choice) their own alma mater. And “judges all over the country have gotten into the business of doling out leftover class-action settlement money, sometimes to organizations only tangentially related to the subject of the lawsuit.” Liptak mentions, for example, that $6 million of leftovers from an anti-trust class-action suit involving fashion models was doled out to various charities, including $1 million to an eating disorder program and $500,000 to a substance abuse program. And, though I blush to mention it, the, ahem, George Washington University Law School was given more than $5 million from unclaimed funds in a suit involving chemical pricing.

So widespread has this practice become and so lucrative are its rewards that charitable organizations are now hiring lawyers to lobby judges for the leftovers. As Liptak concludes, “Judges are turning into grant administrators, and some of them are starting to enjoy it. Who wouldn’t?” See the full story here.

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