JAY EDELSON (Admitted Pro Hac Vice) (Jedelson@Edelson.Com) RAFEY S

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JAY EDELSON (Admitted Pro Hac Vice) ([email protected]) RAFEY S. BALABANIAN (Admitted Pro Hac Vice) ([email protected]) ARI J. SCHARG (Admitted Pro Hac Vice) ([email protected]) CHANDLER R. GIVENS (Admitted Pro Hac Vice) ([email protected]) EDELSON MCGUIRE LLC 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654 Telephone: (312) 589-6370

ATTORNEYS FOR PLAINTIFF

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MINNESOTA

BASEEM MISSAGHI, individually and ) Case No. 11-cv-02559-JRT-JSM on behalf of all others similarly situated, ) ) Plaintiff, ) PLAINTIFF BASEEM MISSAGHI’S ) MEMORANDUM IN SUPPORT OF HIS v. ) MOTION FOR PRELIMINARY ) APPROVAL OF CLASS ACTION BLOCKBUSTER L.L.C., a Delaware ) SETTLEMENT corporation, ) ) [Hon. John R. Tunheim] Defendant. ) ) )

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TABLE OF CONTENTS

INTRODUCTION ...... 1

I. NATURE OF THE LITIGATION ...... 2

A. The Parties and Events Preceding Litigation ...... 2

B. Relevant Provisions of the VPPA ...... 3

C. Litigation, Mediation, and Settlement ...... 4

D. Defendant’s Position ...... 5

II. SETTLEMENT TERMS ...... 6

A. Settlement Class Definition ...... 6

B. Injunctive Relief for the Benefit of the Settlement Class ...... 6

C. Other Relief ...... 8

D. Release ...... 8

III. THE PROPOSED SETTLEMENT CLASS SHOULD BE CERTIFIED ...... 9

A. The Requirement of Numerosity is Satisfied ...... 10

B. The Requirement of Commonality is Satisfied ...... 10

C. The Typicality Requirement is Satisfied ...... 11

D. The Adequate Representation Requirement is Satisfied ...... 12

E. The Proposed Settlement Class Meets the Requirements of Rule 23(b)(2) ...... 14

F. Notice to the Class ...... 16

V. THE COURT SHOULD APPOINT PLAINTIFF’S COUNSEL AS CLASS COUNSEL ...... 16

VI. THE PROPOSED SETTLEMENT WARRANTS PRELIMINARY

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APPROVAL ...... 18

A. The Strength of Plaintiff’s Case ...... 19

B. Blockbuster’s Financial Position ...... 22

C. The Risk of Further Litigation ...... 23

D. The Settlement Relief ...... 24

E. The Experience and Views of Counsel ...... 25

F. The Stage of the Proceedings, Class Counsel’s Investigation, and the Informal Discovery Conducted to Date Support Approval of the Settlement ...... 26

G. The Settlement Resulted From Arms’ Length Negotiations Presided Over by a Well-Respected Mediator, Ensuring the Absence of Collusion ...... 27

CONCLUSION ...... 27

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TABLE OF AUTHORITIES

UNITED STATES SUPREME COURT

Amchem Prods. Inc. v. Windsor, 521 U.S. 591 (1997) ...... 9

Coopers & Lybrand v. Livesay, 437 U.S. 463 (1978) ...... 10

Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974)...... 9

Sorrell v. IMS Health, Inc., 131 S. Ct. 2653 (2011) ...... 22

Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541 (2011) ...... 10, 11, 15

UNITED STATES CIRCUIT COURT OF APPEALS

Adamson v. Bowen, 855 F.2d 668 (10th Cir. 1988) ...... 14

Avritt v. Reliastar Life Ins. Co., 615 F.3d 1023 (8th Cir. 2010) ...... 14

DeBoer v. Mellon Mortg. Co., 64 F.3d 1171 (8th Cir. 1995) ...... 12

Grunin v. Int’l House of Pancakes, 513 F.2d 114 (8th Cir. 1975) ...... 19, 23

In re St. Jude Med., Inc., 425 F.3d 1116 (8th Cir. 2005) ...... 14

In re Wireless Tel. Fed. Cost Recovery Fees Litig., 396 F.3d 922 (8th Cir. 2005) ...... 19

Little Rock Sch. Dist. V. Pulaski County Special Sch. Dist., 921 F.2d 1371 (8th Cir. 1990) ...... 23

Paxton v. Union Nat. Bank, 668 F.2d 552 (8th Cir. 1982) ...... 14, 15

Sperry Rand Corp. v. Larson, 554 F.2d 868 (8th Cir. 1977) ...... 16

Sterk v. Redbox Automated Retail, LLC, 672 F.3d 535 (7th Cir. 2012) ...... 21

UNITED STATES DISTRICT CASES

Alberts v. Nash Finch Co., 245 F.R.D. 399 (D. Minn. 2007) ...... 10

Armstrong v. Board of Sch. Dirs. Of Milwaukee, 616 F.2d 305 (7th Cir. 1980) ...... 25

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Holden v. Burlington Northern, Inc., 665 F.Supp. 1398 (D. Minn. 1987) ...... 25, 26

In re Baycol Products Litig., 218 F.R.D. 197 (D. Minn. 2003) ...... 11, 12

In re Control Data Corp. Sec. Litig., 116 F.R.D. 216 (D. Minn. 1986)...... 12

In re Employee Ben. Plans Sec. Litig., CIV. 3-92-708, 1993 WL 330595 (D. Minn. June 2, 1993) ...... 27

In re Facebook Privacy Litigation, (10-cv-02389-JW) (N.D. Cal. Dec. 10, 2010) ...... 17

In re GenesisIntermedia, Inc. Sec. Litig., 232 F.R.D. 321 (D. Minn. 2005) ...... 10

In re Netflix Privacy Litigation, (11-cv-00370-EJD) (N.D. Cal. Aug. 12, 2011) ...... 17

In re UnitedHealth Group Inc. S’holder Derivative Litig., 631 F. Supp. 2d 1151 (D. Minn. 2009) ...... 19

Kimball v. Frederick J. Hanna & Associates, P.C., CIV-10130MJDJJG, 2011 WL 3610129 (D. Minn. Aug. 15, 2011) ...... 13

Lockwood Motors, Inc. v. Gen. Motors Corp., 162 F.R.D. 569 (D. Minn. 1995) ...... 12

Nerland v. Caribou Coffee Co., Inc., 564 F. Supp. 2d 1010 (D. Minn. 2007) ...... 10

Ngqanyia v. Ashcroft, CIV-02-502(RHK/AJB), 2003 WL 131733 (D. Minn. Jan. 14, 2003) ...... 16

Rodriguez v. Sony Computer Entm’t Am., LLC, No. 4:11-cv-04084 (N.D. Cal. 2011) ...... 13

Sterk v. Best Buy Stores, et. al., No. 1:11-cv-01894 (N.D. Ill. 2011) ...... 13

Sterk v. Redbox Automated Retail, LLC, 806 F. Supp. 2d 1059 (N.D. Ill. 2011) ...... 21

Sterk v. Redbox Automated Retail, LLC, No. 1:11-cv-01729, 2012 WL 1419071 (N.D. Ill. Apr. 24, 2012) ...... 13, 21

Thompson v. Am. Tobacco Co., Inc., 189 F.R.D. 544 (D. Minn. 1999) ...... 14

Wagner v. Family Video Movie Club, Inc., No. 1:11-cv-05671 (N.D. Ill. 2011) ...... 13

Welsch v. Gardebring, 667 F. Supp. 1284 (D. Minn. 1987) ...... 18, 19

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Zilhaver v. UnitedHealth Group, Inc., 646 F. Supp. 2d 1075 (D. Minn. 2009) ..... 18, 19, 23

STATUTES

18 U.S.C. §§ 2710, et seq ...... passim

Fed. R. Civ. P. 23 ...... passim

MISCELLANEOUS

7A FED. PRAC. & PROC. CIV. § 1775 (2d ed. 1986) ...... 14

Conte & Newberg, 4 Newberg on Class Actions (4th ed. 2002) ...... 27

MANUAL FOR COMPLEX LITIGATION (4th ed. 2004) ...... 9

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INTRODUCTION

As the popularity of Internet-based entertainment services has dramatically increased in recent years, so too have the privacy concerns associated with the computerized retention and use of consumers’ personal information. This proposed settlement concerns a nationwide class action alleging that Blockbuster L.L.C.

(“Blockbuster” or “Defendant”), a retailer that rents and sells movies through its internet website and brick-and-mortar locations, violated the Video Privacy Protection Act’s

(“VPPA”) “Destruction of Old Records” provision, 18 U.S.C. § 2710(e), by retaining its customers’ personally identifiable video purchase and rental histories (“PII”) for longer than “necessary for the purpose for which [they were] collected.” (See Docket Number

[“Dkt. No.”] 1.) This settlement follows months of intensive negotiation, including a series of arms’ length negotiations and eventually a day-long mediation with the well- respected mediator Martin Quinn of JAMS. Plaintiff now seeks preliminary approval of the resulting Settlement Agreement. (See “Settlement Agreement,” a copy of which is attached hereto as Exhibit 1.)

This class action has, at its core, two goals: First, it seeks injunctive relief, prohibiting Blockbuster from retaining PII in violation of the VPPA. Second, it seeks statutory damages under the VPPA. The instant settlement1 results in a “best of both worlds” situation—the Class receives immediate 2 industry-leading injunctive relief,

1 Unless otherwise stated herein, capitalized terms shall have the same meanings as set forth in the Parties’ Settlement Agreement.

2 As the ever-increasing number of data breaches have demonstrated, the longer

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providing them (and all future Blockbuster customers) with a right to control the

“decoupling” of their video viewing history from any payment or identification information. In short, the injunctive relief puts a stop to the challenged practices at issue—i.e., tying a customer’s identity to their video viewing history without their informed consent. At the same time, the settlement preserves the Class’s claims for damages,3 allowing those claims to be pursued separately and without delaying the much needed injunctive relief.

All told, the results achieved by the settlement are well beyond those required for preliminary approval. Plaintiff thus moves the Court for preliminary approval of the

Settlement Agreement, certifying the proposed Class for settlement purposes, approving the form and content of the proposed class notice, appointing Plaintiff as class representative, appointing Edelson McGuire, LLC as Class Counsel, and scheduling a final fairness hearing. For convenience, proposed dates and deadlines leading to a final approval hearing are provided in the proposed order separately submitted to the Court.

I. NATURE OF THE LITIGATION

A. The Parties and Events Preceding Litigation

Blockbuster is a leading global provider of in-home movie and gaming

data is kept, the more likely it will be misused or stolen.

3 Unlike the other class action lawsuits pending throughout the country challenging the data retention practices of video-tape service providers under the VPPA, the instant case exists in a unique factual context. Specifically, Blockbuster contends that it acquired Plaintiff’s and the Class’s PII “free and clear” of all claims and encumbrances through a judicially-approved bankruptcy sale only months before the Complaint was filed, which, according to Blockbuster, bars this action as a matter of law.

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entertainment. In addition to its brick-and-mortar rental stores, and not unlike industry leader Netflix, Blockbuster has developed an online system that allows subscribers to rent

DVDs from its website, which are then physically shipped to the individual.

Plaintiff Missaghi is a former Blockbuster customer who subscribed to

Blockbuster’s membership program in or around July of 2005. Missaghi ordered and viewed numerous DVDs from Blockbuster throughout the duration of his subscription before cancelling his membership with Blockbuster in or around September 2005.

Despite cancelling his membership, however, Missaghi alleged that Blockbuster continued to store and maintain his personally identifiable information, including his personal video programming viewing history and billing address.

B. Relevant Provisions of the VPPA

Congress passed the VPPA in the wake of Supreme Court Justice Nominee Robert

H. Bork’s confirmation proceedings where it was disclosed that the Washington City newspaper had obtained and disclosed his personal and family video rental records.

Similar to state statutes enacted to prevent libraries from disclosing their patrons’ checkout lists, the VPPA was designed to protect consumers’ right to privacy in records containing their video viewing decisions. For purposes of this brief, two provisions of the

VPPA are particularly relevant.

Subsection (b) of the VPPA prohibits companies that provide video programming from disclosing their customers’ PII to third parties. See 18 U.S.C. § 2710(b) (“A video tape service provider who knowingly discloses, to any person, personally identifiable information concerning any consumer of such provider shall be liable to the aggrieved

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person.”). Subsection (e) requires that customer records containing PII be destroyed “as soon as practicable.” See 18 U.S.C. § 2710(e) (video tape service providers “shall destroy personally identifiable information as soon as practicable, but no later than one year from the date the information is no longer necessary for the purpose for which it was collected.”).

C. Litigation, Mediation, and Settlement

On September 6, 2011, Plaintiff brought a putative class action against

Blockbuster alleging that the company indefinitely retains its customers’ video rental histories, billing information, and contact information, even after a customer cancels his or her Blockbuster account. (Dkt. No. 1 ¶¶ 3–6.) Plaintiff also alleged that subscribers reasonably expect their PII to be deleted when they cancel their accounts (Id. ¶ 30) and that Blockbuster’s ongoing maintenance of “digital dossiers” on its subscribers—after canceling their subscriptions and beyond the point where Blockbuster still needs the information—constitutes a failure to “destroy [PII] as soon as practicable,” in violation of the VPPA, 18 U.S.C. § 2710(e). (Id. ¶¶ 4, 6, 31, 32, 49.)

On November 7, 2011, Blockbuster moved to dismiss this Action under Federal

Rule of Civil Procedure 12(b)(6) on the grounds that (1) based on the allegations in the

Complaint, it was Blockbuster, Inc. (“Old BB”)—not Blockbuster L.L.C.—that collected

Plaintiff’s personally identifiable information, (2) Old BB filed a voluntary petition for

Chapter 11 bankruptcy on September 23, 2010, (3) the Bankruptcy Court approved the sale of Old BB assets, including customer records, to DISH Network Corporation

(“DISH”), Defendant’s corporate parent, on April 14, 2011, (4) the Bankruptcy Court

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ordered that the sale of assets would be free and clear of any claims of any kind or nature as further described in the Bankruptcy Court’s Sale Order, and (5) the Bankruptcy

Court’s approval of the sale barred this Action. (Dkt. No. 9.) Blockbuster’s motion to dismiss was never resolved because the Parties decided to mediate the dispute.

Following the filing of Defendant’s motion to dismiss, the Parties engaged in a series of settlement discussions, including an in-person meeting in San Francisco on

January 3, 2012, and a full-day mediation at the JAMS offices in San Francisco on March

15, 2012. (See Declaration of Jay Edelson Exh. 2, ¶ 5.) The negotiations were drawn out and contentious, and despite the best efforts of the Parties and the mediator, no agreement was reached at the March 15, 2012 mediation. (Edelson Decl. ¶ 5.) After further arm’s- length negotiations, however, the Parties agreed to settle the action on the terms contained herein. (Id.) It is noteworthy that the Parties first reached agreement on the relief due to the Settlement Class, and it was only after an agreement was reached on class-wide relief that they began negotiations on the costs and attorneys’ fees to be paid

(subject to Court approval) to proposed Class Counsel and the incentive award to

Plaintiff. (Id.)

D. Defendant’s Position

Blockbuster has denied and continues to deny any wrongdoing whatsoever or that it committed, or has attempted to commit, any wrongful acts or violations of law or duty, including, but not limited to, those alleged in the Complaint. Blockbuster’s contends that it purchased the Plaintiff’s and the Settlement Class’s PII “free and clear” from all claims and encumbrances through a judicially approved bankruptcy sale, and thus, cannot be

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liable for failing to comply with the VPPA’s Destruction of Old Records provision. As such, Blockbuster has made clear that it would not provide any compensation whatsoever to the Settlement Class for its alleged statutory violation, and that, if necessary, it will litigate the money damages component of this lawsuit to trial. Blockbuster has, however, agreed to enter into the Settlement Agreement and change its PII retention practices (in the manner discussed below) in order to avoid the further expense, inconvenience, and distraction of litigation, and to be completely free of further participation in the Action.

II. SETTLEMENT TERMS

A. Settlement Class Definition

The Settlement Agreement provides for a Settlement Class defined as follows:

All current and former Blockbuster customers in the United States, its territories, or possessions. (Ex. 1, § 1.13.)

B. Injunctive Relief for the Benefit of the Settlement Class

As set forth in the Parties’ Settlement Agreement, Blockbuster has agreed to implement and adhere to for a period of twenty-four (24) months after the Effective Date, the following:

(1) Within thirty (30) days of the Effective Date, Blockbuster shall modify its privacy policy to reflect the fact that account memberships in Blockbuster are continuous unless affirmatively terminated and will provide a process by which members who desire to terminate their relationship with Blockbuster may have their personally identifiable customer information deleted from Blockbuster’s database by the submission of a form by email or regular mail. Blockbuster shall cause this form to be made available

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online within thirty (30) days of the Effective Date. (Ex. 1, § 3.1(A).)

(2) If a Blockbuster member returns the form described above (and in

Section 3.1(A) of the Settlement Agreement) indicating that he or she elects to have his or her personally identifiable information deleted from Blockbuster’s databases,

Blockbuster will, subject to the other terms herein, promptly decouple the member’s PII from information that identifies the member as having requested or obtained specific video materials. (Ex. 1, § 3.1(C).)

(3) Further, information that identifies a former Blockbuster member

(i.e. an individual who has terminated his or her account pursuant to the process identified in Section 3.1(A) of the Settlement Agreement) as having requested or obtained specific video materials shall be immediately disassociated from that individual’s customer record. (Ex. 1, § 3.1(D).)

(4) Notwithstanding the foregoing, Blockbuster shall state in its privacy policy that it is entitled to keep PII for any member that returns the form described in

Paragraph II.B.1 above (and in Section 3.1(A) of the Settlement Agreement) for a period of ninety (90) days following the member’s last transaction, provided, however, that the

90-day limit shall be extended for, and only for, such further time while there exists any outstanding transaction(s) (including but not limited to outstanding video returns, payment balances, or credit card or check clearances). (Ex. 1, § 3.1 (E).)

As discussed further below, notice of the modified privacy policy will be provided to the Settlement Class Members (i) by posting a copy of the new policy on the

Blockbuster website, (ii) through the Class Notice, and (iii) in the form of placards or

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other similar displays or postings in Blockbuster stores in the United States, its territories, and possessions that will remain visible for at least six (6) months from the Effective

Date. (Ex. 1, § 3.1(B).)

C. Other Relief

In addition to the injunctive relief discussed above, Blockbuster has agreed to the following relief:

(1) Compensation for the Class Representatives. Blockbuster has agreed that Plaintiff, as representative of the Settlement Class, may apply for a class representative award of Seven Hundred and Fifty Dollars ($750.00) as compensation for his time and effort serving the Class in the Action and as compensation for the settlement and release of his individual claims. (See Ex. 1, ¶ 3.3.)

(2) Payment of Attorneys’ Fees and Expenses. Blockbuster has agreed that Class Counsel may apply for a Fee Award, subject to Court approval, of up to One

Hundred and Forty Thousand Dollars ($140,000). (Ex. 1, ¶ 3.2.)

(3) Injunction and Notice Costs. Blockbuster has agreed to pay all costs in connection with the injunction described in Section 3.1 of the Settlement Agreement and notice by publication in the USA Today. Settlement Class members shall not be responsible for paying any part of the agreed fees, costs, expenses, or the incentive award described in the Settlement Agreement. (Ex. 1, ¶ 3.5.)

D. Release

Separately, in exchange for the relief provided above, and upon the entry of an order finally approving this Settlement, Blockbuster will receive a release for all claims

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for injunctive or declaratory relief arising from Blockbuster’s retention of personally identifiable information in relation to 18 U.S.C. § 2710(e). (Ex. 1, ¶1.10) (emphasis added.) For the avoidance of doubt, the “Released Claims” do not include claims arising from or relating to any disclosure of personally identifiable information or claims for monetary relief. (See Id.)

III. THE PROPOSED SETTLEMENT CLASS SHOULD BE CERTIFIED

Prior to granting approval of a class action settlement, the Court should determine that the proposed settlement class is a proper class for settlement purposes. MANUAL FOR

COMPLEX LITIGATION § 21.632 (4th ed. 2004); see Amchem Prods. Inc. v. Windsor, 521

U.S. 591, 620 (1997). The Court may certify a class when the plaintiff demonstrates that the proposed class and proposed class representatives meet the following prerequisites of

Rule 23(a): numerosity, commonality, typicality, and adequacy of representation. Fed. R.

Civ. P. 23(a)(1-4). After meeting the strictures of Rule 23(a), the plaintiff must meet one of the standards set forth in Rule 23(b). Fed. R. Civ. P. 23(b). Here, Plaintiff seeks certification under Rule 23(b)(2), which requires a showing that “the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” Fed. R. Civ. P. 23(b)(2).

In determining whether to certify a class, the Court does not inquire into the merits of the plaintiff’s claims. See Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 177 (1974). As such, the Court accepts the allegations of the plaintiff’s complaint as true, but may consider matters beyond the pleadings to determine if the claims are suitable for

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resolution on a class-wide basis. See Coopers & Lybrand v. Livesay, 437 U.S. 463, 469

(1978) (“class determination generally involves considerations that are ‘enmeshed in the factual and legal issues comprising the plaintiff’s cause of action’”).

A. The Requirement of Numerosity Is Satisfied

The numerosity prerequisite is met when “the class is so numerous that joinder of all members is impractical.” Fed. R. Civ. P. 23(a)(1); Nerland v. Caribou Coffee Co.,

Inc., 564 F. Supp. 2d 1010, 1030 (D. Minn. 2007). To satisfy this requirement, plaintiffs need not prove the “exact” number of potential class members, as long as they give a reasonable estimate of the class size. Id. Generally, a putative class that comprises 40 or more members is enough to make joinder impracticable and satisfy the numerosity requirement. See Alberts v. Nash Finch Co., 245 F.R.D. 399, 409 (D. Minn. 2007). In this case, the Settlement Class consists of millions of individuals and entities, which easily satisfies the numerosity requirement.

B. The Requirement of Commonality is Satisfied

The second threshold to certification requires that “there are questions of law or fact common to the class.” Fed. R. Civ. P. 23(a)(2). Commonality may be demonstrated when the claims of all class members “depend upon a common contention” and “even a single common question will do.” Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541, 2551

(2011); see In re GenesisIntermedia, Inc. Sec. Litig., 232 F.R.D. 321, 328 (D. Minn.

2005) (“While not every question of law and fact must be common to the entire class,

Plaintiffs must show that the course of action giving rise to their cause of action affects all putative class members, or that at least one of the elements of that cause of action is

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shared by all of the putative class members.”). The common contention must be of such a nature that it is capable of class-wide resolution, and that the “determination of its truth or falsity will resolve an issue that is central to the validity of each one of the claims in one stroke.” Dukes, 131 S. Ct. at 2551.

In the instant case, all Settlement Class members share common claims arising out of Blockbuster’s alleged unlawful retention of their PII and personal video programming histories. As Plaintiff alleges, Blockbuster has a stated policy for and a uniform practice of retaining the PII of its subscribers and former subscribers—affecting all Class members in the same way. Such allegations show that Plaintiff and the proposed

Settlement Class share common statutory claims under the VPPA that likewise result in common and shared factual and legal questions such as: (a) whether Blockbuster unlawfully retained its former subscribers’ PII and personal video programming viewing histories and (b) whether Blockbuster’s conduct violates the VPPA. In accordance with the Supreme Court’s recent holding in Dukes, answering these legal issues would resolve the claims of all members of the Class in one stroke. Dukes, 131 S. Ct. at 2551. Thus, considering the nature of the issues and facts that bind each Class member together, commonality is satisfied.

C. The Typicality Requirement is Satisfied

Rule 23 next requires that the Plaintiff’s claims be typical of those of the putative

Settlement Class. Fed. R. Civ. P. 23(a)(3). The purpose of the typicality requirement is to assure that the representatives’ claims are similar enough to those of the class so that the representatives will adequately represent the class, and that the pursuit of the

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representative’s interests will also advance the interests of the class members. See In re

Baycol Prods. Litig., 218 F.R.D. 197, 205 (D. Minn. 2003). Plaintiffs can meet the burden of demonstrating typicality “fairly easily” as long as other class members have claims similar to the named plaintiff. DeBoer v. Mellon Mortg. Co., 64 F.3d 1171, 1174

(8th Cir. 1995). Representative claims are “typical” if they “stem from the same events or rest on the same legal theories.” In re Control Data Corp. Sec. Litig., 116 F.R.D. 216,

220 (D. Minn. 1986). In addition, plaintiffs need not demonstrate that plaintiff’s claims are identical to those of all members of the class. Id. Thus, factual differences, even if they are “substantial,” will generally not be fatal to typicality if the legal theories are similar. Lockwood Motors, Inc. v. Gen. Motors Corp., 162 F.R.D. 569, 575 (D. Minn.

1995).

Here, Blockbuster allegedly retained Plaintiff’s and the Class’s PII and personal video programming histories longer than “necessary for the purpose for which it was collected.” 18 U.S.C. § 2710(e). As a result, Plaintiff has alleged that such conduct violates the VPPA, which would provide injunctive relief and identical statutory damages to all members of the proposed Class. Thus, Plaintiff’s representation of the Settlement

Class is appropriate because the Class members were subjected to the same alleged unlawful conduct and suffered essentially identical damages flowing from that uniform conduct. As such, Plaintiff’s claim for relief is typical of, if not identical to, those of the proposed Class, and Rule 23(a)(3)’s requirement for typicality is met.

D. The Adequate Representation Requirement is Satisfied

The final Rule 23(a) prerequisite requires that the proposed class representative

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has and will continue to “fairly and adequately protect the interests of the class.” Fed. R.

Civ. P. 23(a)(4). To determine if representation is in fact adequate, the court must determine if the class representatives (i) have common interests with the members of the class and (ii) whether the class representative will “vigorously protect the interests of the class through qualified counsel.” Kimball v. Frederick J. Hanna & Associates, P.C., No.

CIV-10130MJDJJG, 2011 WL 3610129, at *6 (D. Minn. Aug. 15, 2011).

Plaintiff’s interests are entirely representative of and consistent with the interests of the proposed Settlement Class—all seek to secure injunctive relief and stand to recover statutory damages under the VPPA for Blockbuster’s alleged unlawful retention of their

PII and personal video programming histories. Also, Plaintiff’s active participation in this litigation from the time proposed Class Counsel commenced their pre-suit investigation of Blockbuster’s practices, to the initial complaint’s filing, to the present, demonstrates that he has and will continue to protect the interests of the proposed Settlement Class.

Further, proposed Class Counsel have extensive experience in consumer class action lawsuits involving the VPPA that are similar in size, scope, and complexity to the present case. (Edelson Decl. ¶ 6.); see, e.g., In re Netflix Privacy Litig., (11-cv-00379-

EJD); Sterk v. Best Buy Stores, et. al., No. 1:11-cv-01894 (N.D. Ill. 2011); Sterk v. Redbox

Automated Retail, LLC, No. 1:11-cv-01729 (N.D. Ill. 2011); Wagner v. Family Video

Movie Club, Inc., No. 1:11-cv-05671 (N.D. Ill. 2011); Rodriguez v. Sony Computer

Entm’t Am., LLC, No. 4:11-cv-04084 (N.D. Cal. 2011); (see also Firm Resume of

Edelson McGuire, LLC, attached as Exhibit 2-A to the Edelson Decl.) Accordingly, both

Plaintiff and proposed Class Counsel have and will continue to adequately represent the

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interests of the proposed Settlement Class.

E. The Proposed Settlement Class Meets the Requirements of Rule 23(b)(2)

A party seeking class certification under Rule 23(b)(2) bears the burden of establishing that the defendant has “acted or refused to act on grounds generally applicable to the class,” thereby making injunctive relief appropriate. Fed. R. Civ. P.

23(b)(2); Paxton v. Union Nat. Bank, 668 F.2d 552, 563 (8th Cir. 1982).

The Eighth Circuit has explained that for Rule 23(b)(2) class actions it is sufficient if class members seek relief from a pattern of acts or practices that are “generally applicable to the class as a whole.” In re St. Jude Med., Inc., 425 F.3d 1116, 1119 (8th

Cir. 2005); Thompson v. Am. Tobacco Co., Inc., 189 F.R.D. 544, 557 (D. Minn. 1999)

(“Rule 23(b)(2) includes an implicit ‘cohesiveness’ requirement, which precludes certification when individual issues abound”); see also 7A FED. PRAC. & PROC. CIV. §

1775 (2d ed. 1986) (“All the class members need not be aggrieved by or desire to challenge the defendant's conduct in order for some of them to seek relief under Rule

23(b)(2)”); Adamson v. Bowen, 855 F.2d 668, 676 (10th Cir. 1988) (emphasizing that although “the claims of individual class members may differ factually,” certification under Rule 23(b)(2) is a proper vehicle for challenging “a common policy”). Further,

“[c]lass certification under Rule 23(b)(2) is proper only when the primary relief sought is declaratory or injunctive.” Avritt v. Reliastar Life Ins. Co., 615 F.3d 1023, 1035 (8th Cir.

2010) (citing In re St. Jude Med., Inc., 425 F.3d at 1121).

Additionally, the “key to the (b)(2) class is the indivisible nature of the injunctive

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or declaratory remedy warranted—the notion that the conduct is such that it can be enjoined or declared unlawful only as to all of the class members or as to none of them.”

Dukes, 131 S. Ct. at 2557. In other words, “Rule 23(b)(2) applies only when a single injunction or declaratory judgment would provide relief to each member of the class. It does not authorize class certification when each individual class member would be entitled to a different injunction or declaratory judgment against the defendant.” Id. While the Eighth Circuit has held that incidental damages may be recovered as part of a Rule

23(b)(2) class action, a plaintiff seeking injunctive relief and no monetary relief need only demonstrate that “final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” Id.; Paxton, 688 F.2d at 563 (affirming that prayer for monetary damages “incidental” to the injunctive relief does not affect class certification under 23(b)(2) when the practices sought to be enjoined apply class-wide).

On these criteria, certification of a class under Rule 23(b)(2) is appropriate here.

In the instant proceeding, the putative Settlement Class as a whole has been subjected to Blockbuster’s uniform policies and practices of retention and storage of PII, including viewing histories and billing addresses, which makes certification under Rule

23(b)(2) appropriate. (See Dkt. No. 1, ¶¶ 38-43.) The injunctive relief set forth in the

Parties’ Settlement Agreement applies universally to each Settlement Class member by requiring that Defendant provide a process through which members who desire to terminate their relationship with Blockbuster may have their PII deleted from

Blockbuster’s database, thus protecting the personal information of all Settlement Class members. (See Ex. 1, § 3.1.) This relief provides equal benefit to Plaintiff and each

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putative Settlement Class member, and no individual member is entitled to benefits in a manner different from the others. Certification under Rule 23(b)(2) is proper.

F. Notice to the Class

Finally, unlike class certification under Rule 23(b)(3), certification under Rule

23(b)(2) does not require the parties to give notice of the Settlement to the class. Sperry

Rand Corp. v. Larson, 554 F.2d 868, 875 (8th Cir. 1977) (“Under a Rule 23(b)(2) certification the class members are not entitled to notice of the action and are not entitled to ‘opt out’ of the action if they so choose, as they would be under a Rule 23(b)(3) certification”); Ngqanyia v. Ashcroft, CIV-02-502(RHK/AJB), 2003 WL 131733, *5 n.7

(D. Minn. Jan. 14, 2003) (“Under Rule 23(b)(2), notice to the class is not required and class members are not permitted to opt-out”).

In the instant case, however, and despite the fact that the parties have no obligation to provide notice of this Rule 23(b)(2) Settlement Agreement to the Class, the Parties have agreed that Blockbuster will cause Class Notice to be published, in a form substantially the same as Exhibit C attached hereto, in the USA Today newspaper on two consecutive Mondays. (See Ex. 1, § 4.1.) Further, Class Counsel has agreed to erect a settlement website containing the Class Notice, subject to Court approval, and all relevant settlement documents at their own cost. (Ex. 1, § 4.4.)

IV. THE COURT SHOULD APPOINT PLAINTIFF’S COUNSEL AS CLASS COUNSEL

Next, under Rule 23, “a court that certifies a class must appoint class counsel . . .

[who] must fairly and adequately represent the interests of the class.” Fed. R. Civ. P.

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23(g)(1)(B). In making this determination, the Court must consider counsel’s: (1) work in identifying or investigating potential claims; (2) experience in handling class actions or other complex litigation and the types of claims asserted in the case; (3) knowledge of the applicable law; and (4) resources committed to representing the class. See Fed. R. Civ. P.

23(g)(1)(A)(i-iv).

Proposed Settlement Class Counsel have extensive experience in prosecuting class actions and other complex litigation, and specifically have substantial knowledge and experience prosecuting class actions related to technology, privacy, and the VPPA.

(Edelson Decl. ¶¶ 6; Exhibit 2-A); see also In Re: Facebook Privacy Litig., (10-cv-

02389-JW) (Dkt. No. 69) (N.D. Cal. Dec. 10, 2010) (Judge Ware, in appointing co-lead counsel, noted that Edelson McGuire “were pioneers in the electronic privacy class action field, having litigated some of the largest consumer class actions in the country on this issue”); In re Netflix Privacy Litig., (11-cv-00379-EJD) (Dkt. No. 59) (N.D. Cal. Aug. 12,

2011) (VPPA case in which Judge Davila appointed Edelson McGuire lead counsel in a contested leadership petition and noted that the firm “specializes in class actions relating to consumer technology and privacy issues” and that the “firm’s significant and particularly specialized expertise in electronic privacy litigation and class actions renders them superior to represent the putative class.”) Further, proposed Settlement Class

Counsel have diligently investigated and prosecuted this matter, dedicated substantial resources to the investigation of the claims at issue, and have successfully negotiated the settlement of this matter to the benefit of the Settlement Class. (Edelson Decl. ¶ 8.)

Accordingly, the Court should appoint Edelson McGuire, LLC to serve as Class Counsel

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for the Settlement Class pursuant to Rule 23(g).

V. THE PROPOSED SETTLEMENT WARRANTS PRELIMINARY APPROVAL

Under Federal Rule of Civil Procedure 23(e), “[t]he claims, issues, or defenses of a certified class may be settled, voluntarily dismissed, or compromised only with the court’s approval[,]” and such approval may occur “only after a hearing and on finding that the [proposal] is fair, reasonable, and adequate.” Fed. R. Civ. P. 23(e); Zilhaver v.

UnitedHealth Group, Inc., 646 F. Supp. 2d 1075, 1079 (D. Minn. 2009). While the court has discretion in approving any settlement, great weight is given to the opinions of counsel for the parties when they believe that the settlement is in the best interests of the plaintiffs and defendants, and the court is entitled to rely on the judgment of experienced counsel in its evaluation of the merits of a class action settlement. Welsch v. Gardebring,

667 F. Supp. 1284, 1295 (D. Minn. 1987).

As provided above, the Parties agreed on the terms of the settlement through experienced counsel, who had ample information at their disposal, and after several rounds of extensive arm’s-length negotiations, including in part, through mediation overseen by well-respected mediator Martin Quinn of JAMS. Accordingly, the Court should give weight to the determination of experienced counsel and the mediator that the

Settlement Agreement is fair and reasonable.

In analyzing the fairness, reasonableness, and adequacy of a class action settlement, courts also typically consider the following non-exhaustive list of factors: (1) the strength of the case for plaintiffs on the merits, balanced against the amount offered in

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the settlement; (2) the defendant’s financial situation; (3) the risk, expense, complexity, and likely duration of continued litigation; (4) opposition to the settlement; (5) experience and opinion of counsel on both sides; (6) the settlement’s timing, including whether discovery proceeded to the point where all parties were fully aware of the merits; (7) whether a settlement resulted from arm’s-length negotiations; and (8) whether a skilled mediator was involved. Grunin v. Int’l House of Pancakes, 513 F.2d 114, 124 (8th Cir.

1975), cert. denied, 423 U.S. 864 (1975); see In re UnitedHealth Group Inc. S’holder

Derivative Litig., 631 F. Supp. 2d 1151, 1156 (D. Minn. 2009). Finally, the Court must find that there was no collusion present in reaching the settlement. Zilhaver, 646 F. Supp.

2d at 1079. In the instant case, these factors favor approving the Settlement Agreement.

A. The Strength of Plaintiff’s Case

The most important consideration in deciding whether a settlement is fair, reasonable, and adequate is “the strength of the case for plaintiffs on the merits, balanced against the amount offered in settlement.” In re Wireless Tel. Fed. Cost Recovery Fees

Litig., 396 F.3d 922, 933 (8th Cir. 2005). The analysis of Plaintiff’s probability of success on the merits, however, is not rigid or beholden to any particular formula, and the Court is entitled to rely on the judgment of experienced counsel in its evaluation of the merits of a class action settlement. Welsch, 667 F. Supp. 1284 at 1295.

Importantly, Blockbuster has agreed to wide ranging injunctive relief, the crux of which is giving their customers and former customers the right to have their PII

“decoupled” from their video viewing history. This injunctive relief offers immediate, industry-leading privacy protection, (Edelson Decl. ¶ 9), and will help prevent the

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intentional and unintentional use and disclosure of the Settlement Class members’ highly personal video viewing histories—the very thing the VPPA was created to protect. (Id.)

Although Plaintiff and proposed Class Counsel are confident in the strength of their claims and in their ability to ultimately prevail at trial, they also recognize that litigation is inherently risky. (Edelson Decl. ¶ 11.) If the litigation were to proceed,

Blockbuster would raise several colorable defenses to Plaintiff’s claims, making this

Settlement, and especially the immediate injunctive relief secured by it, all the more reasonable. Specifically, as set forth in its motion to dismiss, Blockbuster would argue that the Bankruptcy Court approved the sale of Old BB assets, including customer records, to DISH on April 14, 2011, and that the Bankruptcy Court’s approval of the sale bars this Action. Such a defense is one of first impression in the context of the VPPA and while Plaintiff believes that he will ultimately prevail in the face of such a defense, the uncertainty as to the outcome demonstrates the wisdom in settling on these terms.

Further, given the timing of the bankruptcy sale and the amount of time that it has been retaining Plaintiff’s and the Class’s PII, Blockbuster will also likely argue that it has not retained the PII longer than “necessary for the purpose for which [they were] collected” in violation of the VPPA. Plaintiff disputes the validity of such a defense, but it nonetheless informed the decision to accept the instant settlement, and rightfully so.

(Edelson Decl. ¶ 12.) In the end, while Plaintiff believes he would more likely than not succeed on the merits, the viability of Blockbuster’s factual and legal defenses to the claims counsels in favor of avoiding the risks inherent in litigation. (Edelson Decl. ¶ 13.)

Additionally, two legal issues create uncertainty that Plaintiff accounted for when

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deciding to accept settlement. This is one of several class actions pending across the country against video-tape service providers for violation of subsection (e) (18 U.S.C. §

2710(e), the “Destruction of Old Records” provision) of the VPPA. One of the main issues in dispute in these cases is whether a civil action for statutory damages under subsection 2710(c) (the civil penalty provision) could be maintained for violation of subsection 2710(e). In the case of Sterk v. Redbox, the Northern District of Illinois rejected the defendant’s argument that no private right of action exists for unlawful retention of PII, finding that statutory damages under § 2710(c) could be sought for violation of § 2710(e). 806 F. Supp. 2d 1059 (N.D. Ill. 2011).

However, in the first appellate court decision to squarely address the issue of

“whether subsection (e) of the [VPPA] can be enforced by a damages suit under subsection (c) [of the Act],” Redbox, 672 F.3d 535, 536, the Seventh Circuit recently found that subsection 2710(c)’s private right of action provision could be used only to enforce unlawful disclosures as prohibited by subsection 2710(b). Id. at 538.4 Ultimately, while the Plaintiff in this case remains resolute that a civil suit for statutory damages may

4 The Seventh Circuit did not, however, categorically eliminate any right to relief arising out of violations of subsection 2710(e). Rather, the Court left open the possibility that a consumer could enforce subsection 2710(e) through a provision other than subsection 2710(c), including through the Stored Communications Act, 18 U.S.C. § 2707 (“SCA”), and particularly where the consumer alleges some form of economic harm. The district court in Redbox recently recognized such a possibility. Indeed, on remand, Judge Kennelly allowed the plaintiff to pursue his unlawful retention claim through the SCA’s damages provision, as well as through a breach of contract theory. See Sterk v. Redbox Automated Retail, 2012 WL 1419071, at *2-3 (N.D. Ill. Apr. 24, 2012). The district court determined that the Seventh Circuit’s holding did not categorically preclude civil actions to enforce the retention provision of the VPPA and further that Section 2707 of the SCA provides a mechanism to assert such claims. Id. at *2.

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be maintained for violation of § 2710(e), that doesn’t take away from the fact that the opinion highlights the uncertainties inherent in litigation of this sort, and demonstrates the wisdom of the present settlement.

Next, uncertainty regarding the scope of the Supreme Court’s ruling in Sorrell v.

IMS Health, Inc., 131 S. Ct. 2653 (2011), cautions in favor of settlement. In Sorrell, the

Supreme Court ruled that a Vermont statute restricting pharmacies from selling information about doctors’ drug prescription habits for marketing purposes violated the

First Amendment. Id. at 2671. The court noted that First Amendment implications arise where information an individual “possesses is subjected to ‘restraints on the way in which the information might be used’ or disseminated.” Id. While Plaintiffs and proposed

Class Counsel maintain that the VPPA’s disclosure and retention provisions do not violate the First Amendment, IMS does present legal uncertainty that may affect the claims, since the full effect of that decision in the lower courts is not yet known.

In light of the uncertainty inherent in this litigation, the time value of money, the immediate benefits offered by the injunctive relief, and the fact that Plaintiff’s and the

Class’s claims for damages are being preserved, the Settlement Agreement represents a significant recovery under the circumstances for the proposed Class.

B. Blockbuster’s Financial Position

Under the Settlement Agreement, Blockbuster is responsible for the costs of implementing the injunction described in Section 3.1 of the Settlement Agreement, notice by publication in USA Today, the attorneys’ fees, if any, awarded to proposed Class

Counsel, and the incentive award, if any, awarded to the Plaintiff. Blockbuster has

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provided assurances to Class Counsel that it is financially able to meet the obligations under the Settlement Agreement, including the costs of implementing and abiding by the injunction. Blockbuster’s ability to meet its financial obligations under the settlement further supports its approval.

C. The Risk of Further Litigation

Another factor the Court may consider is the risk of continued litigation balanced against the certainty and immediacy of recovery from the settlement. Grunin, 513 F.2d at

124. Settlement avoids the risks, delays, expense, and complexities of continuing litigation and will produce a prompt, certain, and substantial recovery for the class. See

Zilhaver, 646 F. Supp. 2d at 1080 (emphasizing that settlement “represents a speedy and effective way for the parties to resolve their dispute” when the case is “lengthy, complex, and costly”). The Court should consider the vagaries of litigation and compare the significance of immediate recovery by way of compromise to the mere possibility of future relief after protracted and expensive litigation. Little Rock Sch. Dist. v. Pulaski

County Special Sch. Dist., 921 F.2d 1371, 1383 (8th Cir.1990). This factor favors the approval of a settlement where, as here, significant procedural hurdles remain, including dispositive motions, laborious discovery, and a potential trial.

In the absence of the settlement, it is certain that the expense, duration, and complexity of protracted litigation would be substantial. (Edelson Decl. ¶ 14.) Significant costs would be incurred were this matter to proceed to trial, including expenses for expert witnesses, technical consultants, and myriad other costs necessitated by the trial of a nationwide class action. (Id.) Further, evidence and witnesses from across the country

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would have to be assembled. (Id.) In addition, given the complexity and novelty of the issues, the defeated party would likely appeal. (Edelson Decl. ¶ 15.) As such, the substantial and prompt relief provided to the Settlement Class under the Settlement, compared to the inherent risk of continued litigation, trial, and appeal, weighs heavily in favor of approval.

D. The Settlement Relief

Here, the primary relief sought through Plaintiff’s Complaint was to ensure the proper maintenance of Plaintiff’s and the other Class members’ PII and video viewing histories. (Edelson Decl. ¶ 9.) In response, the Settlement Agreement calls for a process by which customers who desire to terminate their relationship with Blockbuster may instruct the company to delete their PII from its database by the submission of a form by email or regular mail. (See Ex. 1, § 3.1.) These injunctive measures apply to all Class members equally and provide equal and tangible benefits to each. (Edelson Decl. ¶ 10.)

As the alleged failure to protect Class members’ confidential personal information was the central reason that gave rise to this action, the relief secured here achieves Plaintiff’s primary objectives.

Of notable importance, the Settlement Agreement and its corresponding release language do not affect the rights of proposed Class members to monetarily recover for claims raised in Plaintiff’s Complaint. (Ex. 1 § 3.2.) Through the litigation and settlement process, it became apparent that obtaining monetary relief for the entire class was not realistic for a Class of more than 20 million individuals, and given Blockbuster’s colorable defenses. (Ex. 1 § 4.2). Thus, Class members remain free to pursue monetary

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claims against Blockbuster on an individual or class basis if they so choose. As such, the injunctive relief provided through the proposed Settlement Agreement is as good or better than the potential relief available at trial and, at the same time, leaves open alternative channels for putative Class members to pursue any monetary claims they may have.

Critically, this relief is being provided now instead of after trial, when the outcome of such relief is uncertain.

E. The Experience and Views of Counsel.

The next factor for the Court to consider is counsel’s experience and views about the adequacy of the Settlement. See Holden v. Burlington Northern, Inc., 665 F.Supp.

1398, 1420 (D. Minn. 1987) (“The Court recognizes it is entitled to rely on the judgment of experienced counsel when evaluating the merits of a proposed class action settlement .

. . And that in making such an evaluation, the Court should hesitate to substitute its own judgment for that of experienced counsel); see also Armstrong v. Board of Sch. Dirs. of

Milwaukee, 616 F.2d 305, 325 (7th Cir.1980) (noting that the views of counsel are to be accorded deference).

Here, Class Counsel has regularly engaged in major complex litigation and has extensive experience in prosecuting consumer class action lawsuits of similar size and complexity. (See Edelson Decl. ¶ 6.) Through their investigation, litigation across the country on these issues, and the settlement process, Class Counsel have gained an intimate understanding of the instant litigation, and believe the Settlement clearly meets the “fair, adequate, and reasonable” standard required for the Court’s approval. (Edelson

Decl. ¶ 7.) Further, a highly competent law firm represents Blockbuster, and while not

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agreeing with the validity of Plaintiff’s claims, defense counsel agrees that the Settlement

Agreement is fair. (See Dkt. 58.) This factor also favors the Court’s approval of the

Settlement Agreement.

F. The Stage of the Proceedings, Class Counsel’s Investigation, and the Informal Discovery Conducted to Date Support Approval of the Settlement.

Another factor for the Court to consider is the settlement’s timing, including whether discovery proceeded to the point where all parties were fully aware of the merits.

Holden, 665 F.Supp. at 1424. In this case, while the Parties reached the proposed settlement at the early stage of these proceedings, Class Counsel’s investigation into

Blockbuster’s data retention practices, coupled with counsel’s particularized knowledge in this space resulting from its involvement in class action litigation against other industry actors, fully informed Plaintiff’s decision to accept a settlement. That is,

Blockbuster’s storage of Plaintiff’s and the other Class members’ PII and video viewing histories is not seriously in dispute. Thus, the case will likely turn on straightforward legal issues such as whether Blockbuster’s data retention practices violate the VPPA and whether the Bankruptcy Court’s approval of the asset sale bars this Action.

Approval at this early stage of the proceedings is further justified by the fact that at this point, the Plaintiff’s and the other Class members’ PII and video viewing histories have not yet fallen into the wrong hands. Hence, implementing the injunctive relief contemplated by the Settlement means that information will be immediately protected, and also ensures its safekeeping going forward. Hence, the timing of the Settlement warrants approval.

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G. The Settlement Resulted From Arms’ Length Negotiations Presided Over by a Well-Respected Mediator, Ensuring the Absence of Collusion.

In assessing the procedural fairness of a settlement, the Court must determine if the settlement was achieved through “arms-length negotiations, rather than fraud or collusion.” In re Employee Ben. Plans Sec. Litig., CIV. 3-92-708, 1993 WL 330595, at *6

(D. Minn. June 2, 1993). However, “[a]s a general principle, ‘the courts respect the integrity of counsel and presume the absence of fraud or collusion in negotiating the settlement, unless evidence to the contrary is offered.” ALBA CONTE & HERBERT B.

NEWBERG, Newberg on Class Actions § 11:51 (4th ed. 2002).

As explained above, the Settlement Agreement is the result of arm’s length negotiations, which for the most part, were presided over by a mediator. As stated, the settlement provides considerable injunctive value to the Class in the form of giving them the choice to have their PII deleted from Blockbuster’s database and “decoupled” from their video viewing histories, and narrowly draws the Class release to preserve monetary claims and those related to the unlawful disclosure of PII. Additionally, the Parties did not discuss attorneys’ fees until after agreeing upon Class relief. (Edelson Decl. ¶ 5.)

Accordingly, the Court should find and be confident that this process resulted in a settlement free from any taint of collusion, further militating in favor of approval.

CONCLUSION

For the foregoing reasons, Plaintiff respectfully requests that the Court grant his motion for preliminary approval of the Class Action Settlement Agreement, certify the

Settlement Class, appoint Baseem Missaghi as the Class Representative, appoint Jay

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Edelson, Rafey S. Balabanian, Ari J. Scharg, and Chandler R. Givens of Edelson

McGuire LLC as Class Counsel, approve the form and manner of notice described above, and award such other and further relief as the Court deems equitable and just.

Dated: July 3, 2012 Respectfully submitted,

Baseem Missaghi, individually and on behalf of a class similarly situated

By: /s/ Ari J. Scharg One of Plaintiff’s Attorneys

JAY EDELSON (Admitted Pro Hac Vice) ([email protected]) RAFEY S. BALABANIAN (Admitted Pro Hac Vice) ([email protected]) ARI J. SCHARG (Admitted Pro Hac Vice) ([email protected]) CHANDLER R. GIVENS (Admitted Pro Hac Vice) ([email protected]) EDELSON MCGUIRE, LLC 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654 Tel: (312) 589-6370 Fax: (312) 589-6378

CASE 0:11-cv-02559-JRT-JSM Document 41 Filed 07/03/12 Page 35 of 35

CERTIFICATE OF SERVICE

I, Ari J. Scharg, an attorney, hereby certify that on July 3, 2012, I served the above and foregoing Plaintiff Baseem Missaghi’s Memorandum in Support of His Motion for Preliminary Approval of Class Action Settlement by causing true and accurate copies of such paper to be transmitted to all counsel of record via the Court’s CM/ECF electronic filing system, on this the 3rd day of July, 2012.

/s/ Ari J. Scharg

CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 1 of 36

! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! EXHIBIT 1 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 2 of 36

SETTLEMENT AGREEMENT

This Settlement Agreement (the "Agreement" or "Settlement" or "Settlement

Agreement") is entered into by and among Plaintiff Baseem Missaghi ("Plaintiff'), for himself individually and on behalf of the Settlement Class, and defendant Blockbuster L.L.C.

("Blockbuster" or "Defendant") (together, the "Parties", or singularly, a "Party"). Except as otherwise specified, defined terms shall have the meanings set forth in the Definitions Section of this Settlement. This Settlement is intended by the Parties to fully, finally and forever resolve, discharge and settle all the claims specified below, subject to the'terms and conditions herein.

RECITALS

WHEREAS, on September 6, 2011, Plaintiff initiated a putative class action against

Blockbuster in the United States District Court, District of Minnesota, captioned Missaghi v.

Blockbuster L.L. C., Case No. 11-cv-02559-JRT-JSM, alleging a cause of action against

Blockbuster under subsection (e) of the Video Privacy Protection Act, 18 U.S.C. §2710

("VPP A") (the "Action").

WHEREAS, the Complaint in this Action alleged, among other things, that Defendant violated subsection (e) of the VPP A by purportedly failing to "destroy personally identifiable information [of Plaintiff and the class members] as soon as practicable after it was no longer necessary for the purpose for which it was collected" as required by that subsection. 18 U.S.C.

§ 271 0( e). Plaintiff sought, inter alia, statutory damages and injunctive relief under the VPP A on behalf of himself and the putative class members.

WHEREAS, on November 7, 2011, Defendant moved to dismiss this Action under

Federal Rule of Civil Procedure 12(b)( 6) on the ground that (i) based on the allegations in the

Complaint, it was Blockbuster, Inc. ("Old BB")-not Blockbuster L.L.C.-that collected

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Plaintiffs personally identifiable information, (ii) Old BB filed a voluntary petition for

Chapter 11 bankruptcy on September 23,2010, (iii) the Bankruptcy Court approved the sale of

Old BB's assets, including customer records, to DISH Network Corporation ("DISH"),

Defendant's corporate parent, on April14, 2011, (iv) the Bankruptcy Court ordered that the sale of assets would be free and clear of any claims of any kind or nature as further described in the

Bankruptcy Court's Sale Order; and (v) the Bankruptcy Court's approval of the sale bars this

Action. (Dkt. No. 11).

WHEREAS, after analyzing the issues raised by Defendant's Motion to Dismiss, Plaintiff engaged in a series of settlement discussions with Defendant, including an in-person meeting in

San Francisco on January 3, 2012 and a mediation at JAMS in San Francisco on March 15, 2012.

The Parties engaged in extensive and c0ntentious negotiations, and despite the best efforts of the

Parties and the mediator, were unable to come to an agreement at the March 15, 2012 mediation.

After further arms' length negotiations, the Parties agreed to settle the action on the terms contained herein.

WHEREAS, based upon extensive analysis of the facts and the law applicable to

Plaintiffs claims in the Action, and taking into account the burdens and expense of such litigation-including the risks and uncertainties associated with protracted trial and appeals-as well as the fair, cost-effective and assured method of resolving the claims of the Settlement

Class, Plaintiff and Class Counsel have concluded that this Agreement provides substantial benefits to the Settlement Class and is fair, reasonable, adequate and in the best interests of

Plaintiff and the Settlement Class as it will promptly provide them with injunctive relief.

WHEREAS, Defendant has denied and continues to deny Plaintiffs allegations, including that it committed any violation of law or engaged in any other wrongful conduct, and

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further denies that it is liable for any claim asserted in the Action. Defendant has agreed, despite its belief that it is not liable for any claim asserted against it and that it has good defenses thereto, to enter into this Agreement in order to avoid further expense, inconvenience, and the distraction of litigation, and to be completely free of further participation in the Action and any further controversy with respect to the Released Claims.

NOW THEREFORE, the Parties desire that the claims released below against the persons and entities identified below shall be finally and fully compromised, settled, and resolved on the terms and conditions set forth in this Settlement, subject to Court approval of this Agreement a:s a good faith, fair, reasonable, and adequate settlement.

1. DEFINITIONS.

As used herein, in addition to any definitions set forth elsewhere in this Agreement, the following terms shall have the meanings set forth below:

1.1 "Class Notice" means legal notice of the terms of the proposed settlement as approved by the Court as part of its entry ofthe Preliminary Approval Order.

1.2 "Class Counsel" means the following firms and individuals:

EDELSON MCGUIRE LLC Jay Edelson Rafey S. Balabanian Ari J. Scharg Chandler R. Givens 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654

1.3 "Complaint" means the putative class action complaint filed by Plaintiff on

September 6, 2011 in the Action (Dkt. No. 1).

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1.4 "Defendant's Counsel" means the following firms and individuals:

COBLENTZ, PATCH, DUFFY & BASS LLP Richard R. Patch Lauren S. Kowal Jeremiah J. Burke One Ferry Building, Suite 200 San Francisco, California 94111-4213

BARNES & THORNBURG LLP Annamarie A. Daley 225 South Sixth Street, Suite 2800 Minneapolis, Minnesota 55402-4662

1.5 "Effective Date" means the first date after which all of the following events and conditions have been met or have occurred or have been mutually waived by written agreement of the Parties:

(a) All Parties have executed this Agreement;

(b) The Court has certified the Settlement Class;

Exhibit A attached hereto) issuing its Preliminary Approval of this Agreement, the settlement set forth herein, and approving the method for providing notice to the Settlement Class;

(d) The Court has entered the Final Judgment (which shall be substantially in the form of Exhibit B attached hereto) approving this Agreement, including all settlement considerations as set forth in this Agreement, releasing the Released Persons from the Released

Claims, and dismissing, with prejudice as to the Plaintiff, the Action with respect to Blockbuster, and all claims asserted therein; and

(e) There has occurred: (i) the passage of five (5) days from entry ofthe Final

Judgment and no formal objections were filed; (ii) in the event that one or more formal objections to entry of the Final Judgment were filed, the expiration of the time to appeal from the

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Final Judgment without the filing or notice of an appeal; (iii) the final non-appealable dismissal of any appeal from the Final Judgment; (iv) if a ruling or decision has been entered by an appellate court affirming the Final Judgment in a form substantially identical to that of the Final

Judgment entered by the Court, the time to petition for en bane rehearing and review to the

United States Supreme Court with respect to such ruling or decision has expired; or (v) if a petition for en bane rehearing or review to the United States Supreme Court with respect to the

Final Judgment has been filed, the petition has been denied or, if granted, has resulted in affirmance of the Final Judgment in a form substantially identical to the form of the Final

Judgment entered by the Court.

1.6 "Fairness Hearing" means the hearing at or after which the Court will make a final decision whether to approve this Agreement and the settlement set forth herein as fair, reasonable, and adequate.

1. 7 "Final Judgment" means the judgment entered by the Court in substantially the form of Exhibit B attached hereto (the "Final Approval Order").

1.8 "Person" means any natural person, individual, corporation, association, partnership, trust, or any other type of legal entity.

1.9 "Preliminary Approval" shall mean the Court's entry of an order substantially in the form of Exhibit A attached hereto approving the timing, content, and manner of the Class

Notice, conditionally certifying the Class for settlement purposes, preliminarily approving this

Agreement and the terms of settlement contained herein, and enjoining the commencement or continued prosecution by any Releasing Person of any Released Claim against any Released

Person (the "Preliminary Approval Order").

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1.1 0 "Released Claims" means and includes any and all claims for injunctive or declaratory relief of whatever kind or nature, whether foreseen or unforeseen, and whether known or unknown, arising from Blockbuster's retention of personally identifiable information in relation to 18 U.S.C. § 2710(e). For the avoidance of doubt, the "Released Claims" do not include claims arising from or relating to any disclosure of personally identifiable information or claims for monetary relief.

1.11 "Released Persons" means and includes Blockbuster, and its direct and indirect parents (including DISH and its direct and indirect subsidiaries), subsidiaries, and affiliated

Persons; the past and present officers, directors, employees, partners, shareholders, agents, attorneys, and insurers of all of the foregoing; and the predecessors, successors, assigns, and legal representatives of all of the foregoing.

1.12 "Releasing Persons" means Plaintiff, each Settlement Class Member, and any

Person claiming by or through Plaintiff, or any Settlement Class Member, as his or her spouse, child, heir, associate, co-owner, attorney, agent, administrator, devisee, assignee, executor, successor, predecessor, or other representative.

1.13 "Settlement Class" means all current and former "Blockbuster" customers in the

United States, its territories, or possessions.

1.14 · "Settlement Class Member(s)," or "Class Member(s)," means any Person who is included within the definition of the Settlement Class.

2. CERTIFICATION OF THE PROPOSED SETTLEMENT CLASS.

2.1 For purposes of effectuating this Settlement, the Parties stipulate to certification of the Settlement Class as defined in Section 1.13 above; stipulate to the appointment of Plaintiff as the representative of the Settlement Class (the "Class Representative"), and stipulate to the appointment of Class Counsel as counsel for the Settlement Class. The Parties agree to cooperate

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in the preparation of such moving papers as the Court shall require to effectuate certification of the Settlement Class for settlement purposes.

2.2 Certification of the Settlement Class and. appointment of the Class Representative and Class Counsel by the Court shall be binding only with respect to the settlement of the

Action. In the event the Effective Date for any reason does not occur, the certification of the

Settlement Class and appointment of Class Representative and Class Counsel shall be vacated, the Parties' stipulation shall be voided, and the Action shall proceed as though the certification and appointments had never occurred.

3. SETTLEMENT RELIEF.

3.1 Injunctive Relief For The Benefit Of Plaintiff And The Settlement Class. In consideration for the termination and dismissal of this Action as set forth herein, and the full and final settlement of all Released Claims by Settlement Class Members, Blockbuster agrees to do the following for a period of twenty-four (24) months following the Effective Date:

(A) Within thirty (30) days of the Effective Date, Blockbuster shall modify its privacy policy to reflect the fact that account memberships in Blockbuster are continuous unless affirmatively terminated, and will provide a process by which members who desire to terminate their relationship with Blockbuster may instruct Blockbuster to delete their personally identifiable customer information from Blockbuster's database by the submission of a form by email or regular mail. Blockbuster shall cause this form to be made available online within thirty

(30) days ofthe Effective Date.

(B) Notice ofthe updated privacy policy will be provided to the Settlement

Class Members (i) by posting a copy of the new policy on the Blockbuster website; (ii) through the Class Notice; and (iii) in the form of placards or other similar displays or postings in

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Blockbuster stores in the United States, its territories and possessions that will remain visible for at least six (6) months from the Effective Date.

(C) If a Blockbuster member returns the form described in Section 3.1 (A) above indicating that he or she elects to have his or her personally identifiable information deleted from Blockbuster's databases, Blockbuster will, subject to the other terms herein, promptly decouple the member's personally identifiable information from information that identifies the member as having requested or obtained specific video materials. By way of example, Blockbuster shall be entitled to maintain sufficient information to identify the individual's location and sales activity for sales tax audit purposes for seven (7) years from each transaction date.

(D) Information that identifies a former Blockbuster member (i.e., an individual who hasterminated his or her account pursuant to the process identified in

Section 3.1(A) above) as having requested or obtained specific video materials shall be immediately disassociated from that individual's customer record. To the extent that Blockbuster is required by law to maintain certain records with respect to such former members by the

Internal Revenue Service in connection with the Bankruptcy purchase, Blockbuster will isolate such information and will use reasonable and appropriate methods to ensure that the data is not accessible for any purposes other than those necessary for such purposes.

(E) Notwithstanding the foregoing, Blockbuster shall state in its privacy policy that it is entitled to keep personally identifiable information for any member that returns the form described in Section 3.1 (A) above for a period of ninety (90) days following the member's last transaction, provided, however, that the 90-day limit shall be extended for such

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further time while there exists any outstanding transaction(s) (including but not limited to outstanding video returns, payment balances, or credit card or check clearances).

(F) Nothing contained herein shall be construed to prohibit Blockbuster from selling, giving, or otherwise transferring the individualized video viewing history of the Class

Members to the extent permitted by the Video Privacy Protection Act.

3.2 Fee Payment To Plaintiff's Counsel. Blockbuster agrees not to oppose (or solicit others to oppose), and Class Counsel agrees that it shall submit, an application for attorneys' fees, costs and expenses to Class Counsel in an amount not to exceed One Hundred and Forty

Thousand Dollars ($140,000.00). Class Counsel further agrees that, notwithstanding any award of attorneys' fees, costs and expenses by the Court in an amount higher than $140,000.00, Class

Counsel will not enforce nor attempt to enforce such an award to the extent it exceeds the

$140,000.00 agreed to herein. Within thirty (30) days after the Effective Date, Blockbuster shall pay to Class Counsel in the form of a check payable to Edelson McGuire, LLC, the total amount actually awarded by the Court as attorneys' fees, expenses, and costs, but not to exceed

$140,000.00.

3.3 Incentive Award to Plaintiff. Blockbuster agrees not to oppose (or solicit others to oppose) an application by the Class Representative for an incentive award not to exceed Seven

Hundred and Fifty Dollars ($750.00) as compensation for his time and effort serving the Class in the Action and as compensation for Plaintiffs settlement and release of his individual claims herein, and the Class Representative and Class Counsel agree not to apply for an incentive award in excess of $750.00 for the Class Representative. Within thirty (30) days after the Effective

Date, Blockbuster shall pay Class Counsel in the form of a check payable to Edelson McGuire,

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LLC, at the address set forth above, the total amount actually awarded by the Court as an incentive award, but not exceeding the sum of $750.00.

3A Injunction Costs. Blockbuster will pay all costs in connection with the injunction described in Section 3.1 above.

3.5 Other than the attorneys' fees, costs, notice costs, and other expenses explicitly provided for above, Plaintiff, the Settlement Class Members, and Blockbuster shall bear their own attorneys' fees, costs, and expenses associated with the Action and/or this Agreement, including in connection with finalizing this Settlement.

3.6 Settlement Class Members shall not be responsible for paying any part of the agreed fees, costs, expenses or the incentive award described in this Agreement.

4. NOTICE TO THE SETTLEMENT CLASS.

4.1 Subject to Court approval, Blockbuster shall cause the Class Notice to be published in substantially the same form as Exhibit C attached hereto in the USA Today newspaper on two consecutive Mondays. Such publication will be completed within thirty (30) days after entry of the Preliminary Approval Order.

4.2 Blockbuster shall pay all costs associated with preparing and publishing the Class

Notice in the manner described above.

4.3 No later than ten (10) days after the Agreement is filed with the Court,

Blockbuster shall provide and bear the cost of notice to appropriate federal and state officials as may be required by 28 U.S.C. § 1715.

4.4 Class Counsel shall erect a settlement website containing the Class Notice, subject to Court approval, and all relevant settlement documents, at its own cost.

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5. DISMISSAL OF ACTION AND RELEASE.

5.1 As soon as practicable after execution of this Agreement, Class Counsel will take all necessary steps to secure the Court's approval of this settlement, certification of the

Settlement Class, the entry of the Final Judgment in the form ofExhibit B attached hereto, and the subsequent dismissal of the Action, with prejudice, as to Plaintiff.

5.2 Plaintiff's General Release. Upon the entry of the Final Judgment and the occurrence of the Effective Date, Plaintiff Baseem Missaghi, and any spouse, parent, child, heir, associate, co-owner, attorney, agent, administrator, devisee, predecessor, successor, assign, legatee, personal representative of any kind, partner, director, employee, or affiliate of his, release and forever discharge the Released Persons from any and all manner of action, causes of action, claims, demands, rights, suits, obligations, debts, contracts, agreements, promises, liabilities, damages (including, but not limited to punitive, exemplary or multiplied damages), charges, penalties, losses, costs, expenses, and attorneys' fees, of any nature whatsoever, known or unknown, in law or equity (including, but not limited to, actions seeking non-economic or injunctive relief), fixed or contingent, accrued or unaccrued, direct, derivative, individual, representative, or in any other capacity.

5.3 The Settlement Class's Release of Injunctive Claims Under 18 U.S.C.

§ 2710(e). Upon the entry ofthe Final Judgment and the occurrence ofthe Effective Date, the

Releasing Persons release, acquit and forever discharge the Released Persons from any and all

Released Claims, and stipulate and agree that they shall be deemed to be forever enjoined and barred from initiating, asserting, and/or prosecuting any Released Claims against any Released

Person in any court or other forum.

5.4 The Parties agree that they may hereafter discover facts in addition to or different from those they believe to be true with respect to the subject matter of this Agreement. Each

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Party agrees that, notwithstanding the discovery of the existence of any such additional or different facts that, if known, would materially affect her, his, or its decision to enter into this

Agreement, the releases given herein shall be and remain in effect as a full, final, and complete release to the Released Claims, and that no Party shall be entitled to modify or set aside this

Agreement, either in whole or in part, by reason thereof.

6. CONDITIONS OF SETTLEMENT AND EFFECT OF DISAPPROVAL, CANCELLATION, OR TERMINATION.

6.1 The Parties agree that no Party shall conduct discovery against any of the others pending the preliminary approval of the settlement by the Court, and that, upon the preliminary approval of this settlement by the Court as evidenced by entry of the Preliminary Approval

Order, all discovery and other proceedings in the Action shall be stayed until further order of the

Court, except such proceedings as may be necessary either to implement this Agreement or to comply with or effectuate the terms of this Agreement.

6.2 In the event that any ofthe events or conditions described in Section 1.5 above either are not met or do not occur, this entire Agreement shall become null and void, except that the Parties shall have the option to agree mutually in writing to waive the event or condition and proceed with this settlement, in which event the Effective Date shall be deemed to have occurred on the date of said written agreement. If any of the events or conditions described in Section 1.5 either are not met or do not occur (and the events or conditions are not mutually waived in writing), the Parties shall return to their respective positions in this lawsuit as those positions existed immediately before the Parties executed this Agreement, and nothing stated in the

Agreement, or in any exhibits to the Agreement, shall be deemed an admission of any kind by any of the Parties or used as evidence against, or over the objection of, any of the Parties for any purpose in this Action or in any other action. In particular, Defendant will retain the right to

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contest whether this case should be maintained as a class action or collective action and to contest the merits of the claims being asserted by Plaintiff.

7. MISCELLANEOUS

7.1 The Parties hereto and their undersigned counsel agree to undertake commercially reasonable efforts and to offer their reasonable cooperation to effectuate this Agreement and the terms of the settlement set forth herein, including taking all steps and efforts contemplated by this Agreement and any other steps and efforts that may become reasonably necessary by order of the Court or otherwise.

7.2 This Agreement, together with its attachments, contains the entire agreement among the Parties hereto and supersedes any prior agreements or understandings (including any term sheets) between them. All terms of this Agreement are contractual and not mere recitals and shall be construed as if drafted by all Parties hereto. The terms of this Agreement are and shall be binding upon each of the Parties hereto, their agents, attorneys, employees, successors and assigns, and upon all other persons claiming any interest in the subject matter hereto through any of the Parties hereto, including any Settlement Class Member and the Releasing Persons.

7.3 In entering into this Agreement, Blockbuster does not admit to any wrongdoing of any kind, and expressly denies wrongdoing of any kind whatsoever, and has entered into this

Agreement and agreed to the terms solely to avoid the risk, expense, inconvenience, distraction, and burden of further protracted litigation.

7.4 This Agreement may be amended or modified only by a written instrument signed by counsel for all Parties. Amendments and modifications may be made without additional notice to the Settlement Class unless such notice is required by the Court.

7.5 This Agreement shall be subject to, governed by, construed, and enforced pursuant to the laws of the State of Minnesota.

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7.6 The exhibits to this Agreement are an integral part of the settlement and are hereby incorporated and made a part of this Agreement.

7.7 This Agreement shall be binding upon and inure to the benefit of the Parties hereto, their respective parents, subsidiaries, and affiliated corporations and their officers, directors, employees, partners, shareholders, agents, and any other successors, assigns, or legal representatives.

7.8 To the extent permitted by law, this Agreement may be pleaded as a full and complete defense to, and may be used as the basis for an injunction against, any action, suit, or other proceeding that may be instituted, prosecuted, or attempted in breach of or contrary to this

Agreement.

7.9 This Agreement, whether or not executed and consummated, and any communications exchanged or actions taken pursuant to or during the negotiation of this

Agreement, are for settlement purposes only. Neither the fact of nor the contents of this

Agreement or its exhibits, nor any communications exchanged nor actions taken pursuant to or during the negotiation of this Agreement, shall constitute or be construed as admissible evidence of the validity of any claim asserted or fact alleged in the Complaint or of any wrongdoing, fault, violation oflaw, or liability of any kind on the part of the Released Persons. This Agreement is made without prejudice to the rights of Blockbuster to oppose certification of a class or classes should this Agreement not be approved or implemented or should the Effective Date not occur.

7.10 The Parties warrant and represent that no claim or any portion of any claim referenced or released in this Agreement has been sold, assigned, conveyed, or otherwise transferred to any other Person.

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7.11 This Agreement may be executed in counterparts, each of which shall constitute an original, and all of which together shall constitute one and the same instrument. This

Agreement may be executed by facsimile or email signatures, each of which shall be deemed to be an original.

7.12 The Settlement Class Members and Class Counsel, including their experts and consultants, agree that they will not use any confidential material obtained, derived, or created in connection with this lawsuit for any purpose unrelated to this Action.

7.13 Except as otherwise expressly agreed to in writing, Defendant, Defendant's

Counsel, Plaintiff, and Class Counsel agree not to make any oral or written statements to the press regarding the Action or the Settlement. Class Counsel and Defendant's counsel reserve the right to post neutral factual statements about the Settlement on their websites and to provide information about the Settlement to courts or in the course of their practices, including but not limited to providing information to potential clients and/or co-counsel.

7.14 The signatories hereto warrant that they are authorized to enter into this

Agreement on behalf of the persons or entities below.

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EXHIBIT A CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 21 of 36

EXHIBIT A

UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA

BASEEM MISSAGHI, individually and on behalf of all others similarly situated, Civil File No. 11-cv-02559-JRT-JSM Plaintiff, [Hon John R. Tunheim] v.

BLOCKBUSTER L.L.C.,

Defendant.

PRELIMINARY APPROVAL ORDER

This matter having come before the Court on Plaintiffs motion for preliminary approval of a proposed class action settlement of the above-captioned action (the

"Action") between PlaintiffBaseem Missaghi ("Plaintiff') and Defendant Blockbuster

L.L.C. ("Blockbuster" or "Defendant"), set forth in the Settlement Agreement between

Plaintiff and Defendant (the "Settlement Agreement"), and the Court having duly considered the papers and arguments of counsel, the Court hereby finds and orders as follows:

1. Unless defined herein, all capitalized terms in this Order shall have the same meanings as set forth in the Settlement Agreement.

2. The Court has conducted a preliminary evaluation of the settlement set forth in the Settlement Agreement for fairness, adequacy, and reasonableness. Based on this preliminary evaluation, the Court finds that there is probable cause to believe that the settlement is fair, reasonable and adequate, and has been negotiated at arms' length

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between experienced attorneys familiar with the legal and factual issues of this case, and was reached with the assistance of a well-respected mediator, Martin Quinn of JAMS.

Therefore, the Court grants preliminary approval of the settlement.

3. This Court preliminarily finds, for the purposes of settlement only, that the

Action meets all the prerequisites of Rule 23 of the Federal Rules of Civil Procedure, including numerosity, commonality and typicality, that the Class Representative adequately represents the Settlement Class, and that Class Counsel are adequate to represent the Settlement Class.

4. The following Settlement Class is conditionally and preliminarily certified for settlement purposes only:

All current and former "Blockbuster" customers in the United States and its territories and possessions.

5. For settlement purposes only, the Court hereby preliminarily approves the appointment ofPlaintiffBaseem Missaghi as Class Representative.

6. For settlement purposes only, the Court hereby preliminarily approves the appointment of the following Class Counsel:

Jay Edelson Rafey S Balabanian Ari J. Scharg Chandler R. Givens 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654

7. If final approval of the settlement is not obtained, this certification order, including the above description of the Settlement Class and appointment of the Class

14662.001 2072900v1 2 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 23 of 36

Representative and Class Counsel, shall be vacated and this action shall proceed as though the certification and appointments never occurred.

8. Pending final determination of whether the settlement should be approved, neither Plaintiff nor any member of the Settlement Class, whether directly, indirectly, representatively, or in any other capacity, shall commence or prosecute any action or proceeding in any court or tribunal asserting any of the claims herein against Blockbuster.

9. The Court approves the proposed plan for giving notice to the Settlement

Class by publishing the Class Notice, attached to the Settlement Agreement as Exhibit C, in the USA Today newspaper on two (2) consecutive Mondays, as more fully described in the Settlement Agreement. The plan for giving notice, in form, method, and content, constitutes reasonable, appropriate and sufficient notice to all Persons within the definition of the Settlement Class under the circumstances, and fully complies with the requirements of due process and of all applicable statutes and laws. Blockbuster shall cause the publication described in this paragraph to be completed no later than [DATE].

10. The date by which Defendant shall cause the Class Notice to be published may be subject to change by stipulation of the parties and approval of the Court. If the

Class Notice publication date is changed, all other agreed-upon dates will be changed accordingly.

11. On [DATE & TIME], this Court will hold a Fairness Hearing on the fairness, adequacy, and reasonableness of the Settlement Agreement, and to determine whether Final Judgment approving the settlement and dismissing all claims asserted in the litigation with prejudice should be entered. The Fairness Hearing may be postponed,

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adjourned, or rescheduled by order of the Court without further notice to the members of the Class. No later than [DATE], Plaintiff must file his papers in support of final settlement approval and in response to any objections, as well as Class Counsel's application for attorneys' fees and expenses.

12. Objections by any Settlement Class Member to the Settlement Agreement shall be heard by the Court at the Fairness Hearing. Written objections shall (1) be filed with the Clerk of the United States District Court, District of Minnesota, with a copy postmarked to Class Counsel identified in the Class Notice no later than [DATE],

(2) describe the objection and its basis, (3) include the objector's full name, address, and telephone number, and (4) if the objecting Settlement Class Member is represented by separate counsel, identify his, her or its attorney. A Settlement Class Member need not appear at the Fairness Hearing in order for his, her, or its written objection to be considered, and the filing of a written objection is not a precondition to speak at the

Fairness Hearing. Any Settlement Class Member who fails to object in the manner prescribed herein shall be deemed to have waived his or her objections and will forever be barred from making any such objections in this action or in any other action or proceeding.

13. Class Counsel shall file any application for an award of attorneys' fees and costs and for incentive payments to the named Plaintiff ("Fee Application") no later than

[DATE]. The hearing on the Fee Application shall be set for the same date as the

Fairness Hearing.

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14. Counsel for the parties shall file any memoranda, declarations, or other statements and materials in support of final approval of the Settlement Agreement (the

"Motion for Final Approval of the Settlement Agreement") no later than [DATE].

15. Counsel for the parties shall file any reply papers in support of the parties'

Motion for Final Approval of the Settlement Agreement and in response to any objections from Settlement Class Members no later than [DATE].

16. Class Counsel shall file any reply papers in support of its Fee Application and in response to any objections from Settlement Class Members no later than [DATE].

17. The settlement on the terms and conditions of the Settlement Agreement filed concurrently with the parties' joint motion for preliminary approval is hereby preliminarily approved, but is not to be deemed an admission of liability or fault by

Defendant or by any other party or person, or a finding of the validity of any claims asserted 'in the litigation or of any wrongdoing or of any violation of law by Defendant or any other party or person. The settlement is not a concession and shall not be used as an admission of any fault or omission by Defendant or any other party or person.

18. Counsel for the parties are hereby authorized to utilize all reasonable procedures in connection with the administration of the settlement that are not materially inconsistent with either this Order or the terms of the Settlement Agreement.

19. The certification of the Settlement Class shall be binding only with respect to the settlement of the Action. In the event that the Settlement Agreement is terminated pursuant to its terms or is not approved in all material respects by the Court, or such approval is reversed, vacated, or modified in any material respect by this or any other

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court, the certification of the Settlement Class shall be deemed vacated, the Action shall proceed as if the Settlement Class had never been certified (including the preservation of

Defendant's right to oppose any subsequent motion for class certification), and no reference to the Settlement Class, the Settlement Agreement, or any documents, communications, or negotiations related in any way thereto shall be made for any purpose.

20. Summary of Dates and Deadlines:

Last day to publish Class Notice:

Last day to file (1) Motion for Final Approval and (2) Fee Application: Last day for Class Members to file comments and objections to the Motion for Final Approval: Last day for the parties to file replies to any class member objections to the Motion for Final Approval: Fairness Hearing:

IT IS SO ORDERED this [DAY] day of[MONTH] 2012.

HONORABLE JOHN R. TUNHEIM UNITED STATES DISTRICT JUDGE

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EXHIBIT B CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 28 of 36

EXHIBITB

UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA

BASEEM MISSAGHI, individually Civil File No. 11-cv-02559-JRT-JSM and on behalf of all others similarly situated,

Plaintiff, [Hon John R. Tunheim] v.

BLOCKBUSTER L.L.C.,

Defendant.

FINAL JUDGMENT ORDER

The Court, having considered Plaintiffs Motion for Final Approval of the Settlement in the above-captioned case brought by Plaintiff Baseem Missaghi ("Plaintiff') against Blockbuster L.L.C. ("Blockbuster" or "Defendant") (collectively, the "Parties"), the Settlement Agreement dated [DATE] (the "Settlement Agreement"), having considered all of the objections and comments received regarding the proposed settlement, the record in the above captioned action (the "Action"), and the submissions and arguments presented by counsel, and having held a Fairness Hearing on [DATE], finds that: 1. Unless defined herein, for purposes of this Final Judgment and Order Approving Settlement and Dismissing Claims with Prejudice ("Final Judgment"), all capitalized terms in this Order shall have the same meanings as set forth .in the Settlement Agreement. 2. The Court has jurisdiction over the subject matter of the Action, the Class Representative, the Settlement Class Members, and Defendant.

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3. On [DATE], this Court preliminarily approved the Settlement and certified, for settlement purposes, the Settlement Class consisting of all current and former "Blockbuster" members in the United States and its territories and possessions. 4. Notice to the Settlement Class of the pendency of the Action and of this Settlement has been provided in accordance with the Court's Preliminary Approval Order, constituted reasonable, appropriate and sufficient notice to all Persons within the definition of the Settlement Class under the circumstances, and fully complied with the requirements of due process and of all applicable statutes and laws. 5. The Settlement Agreement was arrived at as a result of arms' length negotiations conducted in good faith by experienced attorneys familiar with the legal and factual issues of this case and with the assistance of a well-respected mediator, Martin Quinn of JAMS, and is thus supported in full by Plaintiff and Settlement Class Counsel. 6. The Settlement Agreement is fair, reasonable, adequate, and in the best interests of the Settlement Class in light of the complexity, expense, and duration of litigation, as well as the risk involved in establishing liability and damages and in maintaining the class action through trial and appeal. 7. The settlement consideration provided by the Settlement Agreement constitutes fair value given in exchange for the release of the Released Claims against the Released Parties. The Court finds that the consideration provided to members of the Settlement Class is reasonable, considering the facts and circumstances of the claims and affirmative defenses asserted in the Action, and the potential risks and likelihood of success of alternatively pursuing trial on the merits. IT IS THEREFORE ORDERED, ADJUDGED AND DECREED THAT: 8. The Settlement Agreement is finally approved as fair, reasonable, adequate, just, and in compliance with all applicable requirements of the United States Constitution (including the Due Process Clause) and all other applicable laws, and in the best interest of the Settlement Class. Any objections have been considered and are hereby overruled.

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Accordingly, the Court directs the parties and their counsel to implement and consummate the Settlement Agreement in accordance with its terms and conditions. 9. Pursuant to Rule 23 of the Federal Rules of Civil Procedure, the Court hereby finally certifies the Settlement Class, solely for purposes of this Settlement, consisting of:

All current and former "Blockbuster" members in the United States and its territories and possessions.

The Settlement Class as certified satisfies all the requirements of Rule 23 and the United States Constitution, and any other applicable law as more fully set forth in the Court's Preliminary Approval Order, which is incorporated into this Final Judgment by this reference.

10. The Court hereby finds, in part based upon the waiver of affirmative defenses by Defendant, solely with regard to this Action, that: (a) the members ofthe Settlement Class are so numerous that joinder of all Settlement Class Members in this Action is impracticable; (b) there are questions of law and fact common to the members of the Settlement Class; (c) the claims of Plaintiff are typical of the claims of the Settlement Class;

(d) Plaintiff has fairly and adequately protected the interests of the Settlement Class.

(e) Defendant has acted or refused to act on grounds that apply generally to the class so that final injunctive relief is appropriate respecting the class as a whole.

11. The preliminary appointment of the following attorneys as Class Counsel is hereby confirmed:

14662.001 2072909v1 3 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 31 of 36

Jay Edelson Rafey S. Balabanian Ari J. Scharg Chandler R. Givens Edelson McGuire LLC 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654

12. Settlement Class Counsel are experienced in class litigation, including litigation of similar claims in other cases, and have fairly and adequately represented the interests of the Settlement Class. 13 . Defendant and Plaintiffs are hereby ordered to comply with the terms and conditions contained in the Settlement Agreement, which is incorporated by reference herein. 14. The Action is hereby dismissed with prejudice and without costs. This judgment has been entered without any admission by Defendant of liability or as to the merits of any of the allegations in the Complaint. 15.. The Releasing Parties hereby release and forever discharge the Released Parties from the Released Claims, as set forth in the Settlement Agreement. 16. As soon as practicable but in no event later than thirty (30) days from the Effective Date, and continuing for a period of twenty-four (24) months, Blockbuster shall modify its privacy policy to reflect the fact that account memberships in Blockbuster are continuous unless affirmatively terminated, and will provide a process by which members who desire to terminate their relationship with Blockbuster may instruct Blockbuster to delete their personally identifiable customer information from Blockbuster's database by the submission of a form by email or regular mail. Blockbuster shall cause this form to be made available online within thirty (30) days of the Effective Date. 17. As soon as practicable but in no event later than thirty (30) days from the Effective Date, and continuing for a period of twenty-four (24) months, Blockbuster shall state in its privacy policy that it is entitled to keep personally identifiable information for

14662.001 2072909v1 4 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 32 of 36

any member that returns the form described in Section 3.1 (A) above for a period of ninety (90) days following the member's last transaction, provided, however, that the 90- day limit shall be extended for, and only for, such further time while there exists any outstanding transaction(s) (including but not limited to outstanding video returns, payment balances, or credit card or check clearances). 18. Plaintiffs, the Settlement Class, and/or Defendant may seek to enforce the provisions of the Settlement Agreement by motion to the Court pursuant to the Court's continuing jurisdiction over the Settlement Agreement as set forth in Paragraph 25 below. 19. The Court awards to Class Counsel $ as attorneys' fees and costs. 20. The Court awards to Plaintiff$ , as an Incentive A ward for his role as Class Representative. 21. The provisions of this Final Judgment are applicable to and binding upon and inure to the benefit of each party to the Action (including each Settlement Class Member and each of Defendant's successors and assigns). 22. To the extent permitted by law and without affecting the other provisions of this Final Judgment, this Final Judgment is intended by the parties and the Court to be res judicata and to prohibit and preclude any prior, concurrent, or subsequent litigation brought individually, or in the name of, and/or otherwise on behalf of the Named Plaintiff or any Settlement Class Member or any others similarly situated in the United States with respect to the Released Claims based upon the same alleged facts at any time prior to the date of the Preliminary Approval Order. 23. The provisions of this Final Judgment are entered as a result of a voluntary agreement of the parties. The Settlement Agreement and this Final Judgment are not intended to, and shall not be construed as any admission, express or implied, of any fault, liability or wrongdoing by Defendant, or any other party or person, or of the accuracy of any of the allegations in the Complaint or Defendant's defenses.

14662.001 2072909vl 5 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 33 of 36

24. Save and except as expressly set forth to the contrary in this Judgment and any judgment issued by this Court regarding Plaintiffs fee application, Plaintiff and Plaintiffs Counsel shall take nothing by their claims and each party shall bear his or its own fees, costs, and expenses in connection with this Action. 25. Jurisdiction is retained by this Court for forty ( 40) months following the Effective Date for the purpose of enabling any party to this Final Judgment to apply to the Court at any time for such further orders and directions as may be necessary and appropriate for the construction or carrying out of this Final Judgment and Settlement Agreement, for the modification of any of the provisions hereof, for enforcement of compliance herewith, and for the punishment of violations hereof. 26. The certification of the Settlement Class shall be binding only with respect to the Settlement of the Action. In the event that the Settlement Agreement is terminated pursuant to its terms or the Court's approval of the Settlement is reversed, vacated, or modified in any material respect by this or any other Court, the certification of the Settlement Class shall be deemed vacated, the Action shall proceed as if the Settlement Class had never been certified (including the preservation of Defendant's right to oppose any subsequent motion for class certification), and no reference to the Settlement Class, the Settlement Agreement, or any documents, communications, or negotiations related in any way thereto shall be made for any purpose. 27. Based upon the Court's finding that there is no just reason for delay of enforcement or appeal of this Order notwithstanding the Court's retention of jurisdiction to oversee implementation and enforcement of the Settlement Agreement, the Court directs the Clerk to enter final judgment pursuant to Federal Rule of Civil Procedure 54(b).

14662.001 2072909v 1 6 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 34 of 36

IT IS SO ORDERED this [DAY] day of[MONTH] 2012.

HONORABLE JOHN R. TUNHEIM UNITED STATES DISTRICT JUDGE

14662.001 2072909vl 7 CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 35 of 36

EXHIBIT C CASE 0:11-cv-02559-JRT-JSM Document 41-1 Filed 07/03/12 Page 36 of 36

EXHIBITC

Notice Of Pendency And Settlement Of Class Action

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MINNESOTA

Baseem Missaghi, individually and on behalf of all others similarly situated, NO. 11-cv-02559-JRT·JSM Plaintiff, NOnCE OF PENDENCY AND SETTLEMENT OF CLASS ACnON v. Final Approval Hearing Date: _____ Blockbuster L.L.C., Defendant Last Day To File Objections: _____

NOnCE OF PENDENCY AND SETTLEMENT OF CLASS ACnON B. You Can Object To The Terms Of The Settlement TO ALL CURRENT AND FORMER "BLOCKBUSTER" MEMBERS IN THE You can object to the Settlement before final approval. However, if the Court UNITED STATES AND ITS TERRITORIES AND POSSESSIONS. rejects your objection, you will be bound by the terms of the Settlement. To object. you must file a written objection with the Clerk of the Court at the following address: PLEASE READ THIS NOnCE CAREFULLY. THIS NOnCE MAY AFFECT YOUR RIGHTS. Clerk of the Court U.S. DistJict Court Attn: Missaghi v. Blockbuster Settlement Objections Case No. 11-2559-JRT/JSM By Order of the United States DistJict Court District of Minnesota (the 'Courf), 300 South Fourth Street YOU ARE HEREBY NOnFIED AS FOLLOWS: 202 U.S. Courthouse A class action lawsuit is now pending in the Court. This Notice explains the Minneapolis, MN 55415 lawsuit. the proposed settlement. and your legal rights. I. DESCRIPnON OF LAWSUIT You must also send a copy to the following counsel: A class action lawsuit is now pending in the Court against Blockbuster L.L.C. ('Blockbuster"). In a class action, one or more people (in this case, the Plaintiff Mr. Blockbuster Settlement Objections Baseem Missaghi) sue on behalf of people who they allege have similar claims. All Edelson McGuire LLC of these people form a Class and are Class members. In this case, the Plaintiff, on 350 North LaSalle Street. Suite 1300 behalf of a Class of all former and current ' Blockbuster' members, has sued Chicago, IL 60654 Blockbuster alleging that Blockbuster violated a statute called the 'Video Privacy Protection Acr or 'VPPA' by purportedly failing to destroy personally identifiable Your written objection shall (a) state your full name, address, and telephone information of Blockbuster members as soon as practicable after the information number, (b) if you are represented by separate counsel, identify your attorney, and was no longer necessary for the purpose for which it was collected. Blockbuster (c) state each specific reason, if any, in support of your objection, and any legal denies these claims and denies that it has committed any wrongdoing of any kind. support for each objection. To be valid and effective, your objections to approval of However, to avoid the burden and cost of further litigation, Blockbuster has agreed the Settlement must be filed with Clerk of the Court and mailed to the above-listed to settle this matter on an injunction-only basis under Federal Rule of Civil counsel and postmarked no later than----- Procedure 23(b)(2). Plaintiff has conducted an investigation into the facts and the law applicable to this IV. WHAT HAPPENS IF THE SETTLEMENT IS APPROVED? lawsuit Plaintiff, and Counsel for Plaintiff and the Class, have concluded that The Settlement will settle and release claims for injunctive or declaratory relief resolving this case on the basis of injunctive relief pursuant to the terms of the against Blockbuster that Plaintiff and the Class Members have alleged or could Settlement Agreement on file with the Court (collectively, the 'Settlemenr) is in the have alleged in the lawsuit for Blockbusters retention of members' personally best interests of the Class. identifiable information pursuant to 18 U.S.C. § 271 O(e). The Settlement will extend to Blockbuster; each of Blockbusters direct and indirect parents (including II. SUMMARY OF THE PROPOSED SETTLEMENT DISH Network Corporation and its direct and indirect subsidiaries), subsidiaries If the Settlement is approved, an Injunction will be issued by the Court requiring and affiliated persons and entities; the past and present officers, directors, Blockbuster to: (a) Modify its privacy policy to reflect the fact that account employees, partners, shareholders, agents attorneys, and insurers of all of the memberships in Blockbuster are continuous unless affirmatively terminated, and foregoing; and the predecessors. successors, assigns, and legal representatives of provide a process by which members who desire to terminate their relationship with all of the foregoing. This Settlement does not release any claims for monetary Blockbuster may instruct Blockbuster to delete their personally identifiable relief that Class Members may have against Blockbuster. information from Blockbusters database by the submission of a form that will be If the Settlement is approved by the Court and becomes final, the Settlement will made available on Blockbusters website: www.blockbuster.com; (b) Provide notice take effect If the Settlement is not approved by the Court or does not become final of the updated privacy policy on the Blockbuster website and in Blockbuster stores; for some other reason, the case will continue. (c) For members that return the form described in part (a) above, promptly decouple the members personally identifiable information from information that V. FINAL SETTLEMENT APPROVAL HEARING identifies the member as having requested or obtained specific video materials, The Court will hold a hearing at the United States District Court, DistJict of subject to the other terms in the Settlement Agreement. Blockbuster shall be Minnesota in the courtroom of the Honorable John R. Tunheim, 300 South Fourth entitled to maintain sufficient information to identify the individual's location and Street. Suite 13E, Minneapolis, Minnesota at_· determine whether sales activity for sales tax audit purposes for seven (7) years from each transaction the Settlement should be finally approved as fair, reasonable and adequate. The date. To the extent Blockbuster is required by law to maintain certain records with hearing may be continued without further notice to the Class. It is not necessary respect to such former members by the IRS in connection with the Bankruptcy for you·to appear at this hearing. purchase, Blockbuster will isolate such information and will use reasonable and appropriate methods to ensure that the data is not accessible for any purposes VI. ADDinONAL INFORMAnON other than those necessary for such purposes. Blockbuster shall also state in its Certain papers and other records in this case that the court has ordered be made privacy policy that it shall be entitled to keep personally identifiable information for available for review by class members, including copies of the Settlement any member that returns the form described in part (a) of this paragraph for up to Agreement may be found on the website of Class Counsel at ___. ninety days following the members last transaction, provided, however: that the Complete court filings and records in this case may be examined in electronic form ninety-day limit shall be extended for, and only for, such further time while there at any time during regular business hours at the office of the Clerk of the United exists any outstanding transactions (including but not limited to outstanding video States DistJict Court DistJict of Minnesota. returns, payment balances, or credit card or check clearances). If you have any questions about this Notice or the Settlement. please direct your In addition, Blockbuster shall pay the fees and costs incurred by Counsel for the questions to counsel for Plaintiff and the Class to: Plaintiff and the Class in an amount up to $140,000.00, and an incentive payment to the Plaintiff in an amount up to $750.00 as approved by the Court. The above is a summary of the basic terms of the Settlement. Raley S. Balabanian Ari J. Scharg Ill. WHAT ARE YOUR OPnONS AS A MEMBER OF THE CLASS? Edelson McGuire LLC Your options as a member of the Class are as follows: 350 North LaSalle Street. Suite 1300 Chicago, IL 60654 A. You Are A Member Of The Class By Doing Nothing [Insert Toll-Free Number[ You may do nothing at all and you will remain a Class Member and be both entitled to and bound by the terms of the injunctive relief set out in the Settlement if PLEASE DO NOT CONTACT THE COURT, THE COURT CLERK, OR it is approved. Because the Settlement provides for injunctive relief only, you do not BLOCKBUSTER. NEITHER BLOCKBUSTER NOR ITS ATTORNEYS WILL BE have the ability to exclude yourself from the class. · As a Class Member, you will not PERMITIED TO DISCUSS THE TERMS OF THE SETTLEMENT WITH YOU. be responsible for the payment of the incentive award or payment of attorneys' fees, expenses or costs. By order of the United States DistJict Court DistJict of Minnesota CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 1 of 22

! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! EXHIBIT 2

indicated. declaration. I make this declaration based upon personal knowledge unless otherwise corporation, BLOCKBUSTER L.L.C., a Delaware on behalf of all others similarly situa BASEEM MISSAGHI, individually and ATTORNEYS FOR PLAINTIFF Facsimile: (312) 589 Telephone: (312) 589 Chicago, Illinois 60654 350 North LaSalle E ([email protected]) CHANDLER R. GIVENS ( ([email protected]) ARI J. SCHARG ( ([email protected]) RAFEY S. BALABANIAN ( ([email protected]) ( EDELSON JAY v. DELSON

CASE 0:11-cv-02559-JRT-JSMDocument41-2Filed07/03/12Page2of22 2. 1. Pursuant to 28 U.S.C. § 1746, I hereby declare and state as follows:

M C

G I am an attorney admitted attorney an I am this make to competent fully am and eighteen of age the over I am UIRE Pro Hac Vice

Pro Hac Vice Street LLC Defendant. Plaintiff, - - 6378 6370 FOR THE DISTRICT OF MINNESOTA THE DISTRICT FOR

UNITED STATES DISTRICT COURT

, Suite 1300 , Suite

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to practice in the State of Illinois and in the the in and Illinois of State the in practice to

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SETTLEMENT APPROVAL OF CLASS ACTION MOTION FOR PRELIMINARY OF SUPPORT PLAINTIFF’S DECLARATION OF JAY EDELSON IN Case No. 11 - cv - 02559

- JRT

- JSM JSM

for Preliminary Approval. ascribed to them Counsel and the incentive award to Plaintiff. to fees attorneys’ and costs the after reachedonclass anagreementwas Parties first reached agreement on the relief due to the Settlement Class, and it was only agreed to settle the action reached 15, 2012. Despite the best efforts of the Parties and the mediator, January 3, 2012, and a full in an including discussions, settlement of series a in f (“Plaintiff”). has been retained to represent the named Plaintiff in this matter, MissaghiBaseem of Class Action Settle courts. this Imake declaration in support ofPlaintiff’s MotionforPreliminary Approval United States District Court for the Northern District of Illinois, and other federal district 1

irm resume of Edelson McGuire, LLC. LLC. McGuire, Edelson of resume irm CASE 0:11-cv-02559-JRT-JSMDocument41-2Filed07/03/12Page3of22 3. Unless otherwise indicated, a 6. 5. 4.

at 15,2012mediation. the March Afterfurther negotiations, however,

Proposed Class Counsel have extensive experience in consumer class Following the filing of Defendant’s motion to dismiss, the Parties Attached as Exhibit A to this Declaration is a true and accurate copy of the which LLC, McGuire Edelson of firm law atthe partner managing the I am

in Plaintiff’s concurrently concurrently Plaintiff’s in ment.

under - day mediation at the JAMS

be paid

the terms co terms the ll capitalized terms terms ll capitalized (subject to Court approval) approval) Court to (subject -

wide relief that the Parties began negotiations on 2

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ntained in the Settlement Agreement. The Memorandum - person meeting in San Francisco on

offices in San Francisco on March herein have the same meaning

in Support of the Motion Motion the of Support in no agreement was to proposed Class Class proposed to the Parties the 1

engaged

equal andtangible benefits to each. created to protec Class members’ highly personal video viewing histories will help prevent the intentional and unintentional use and disclosure of the Settlement history. This injunctive Blockbuster settlement, Blockbuster has agreed to wide (“PII”) information proper maintenance of Plaintiff’s and the other Class members’ personally identifiable Class. Settlement putative the at issue, andhavesuccessfully negotiated the prosecuted this matter, dedicated substantial resources to the investigation of the claims Court’s approval. reaso and adequate, “fair, the meets clearly Settlement the Class Counsel present case. action lawsuits involvingthat aresimilar the VPPA in size, scope,andcomplexity to the CASE 0:11-cv-02559-JRT-JSMDocument41-2Filed07/03/12Page4of22 7. 11. 10. 9. 8.

’s (See Ex. A.) Ex. (See Although Plaintiff and proposed Class Counsel are confident in the strength These injunctive measures apply The primary relief sought through Plaintiff’s Complaint was to ensure the Proposed Settlement Class Counsel Through the investigation and litigation of similar cases across the country,

customers the right to havetheir decoupledtheir PII from video viewing have gained an intimate understanding of the instant litigation, and believe t.

and video viewing histories. the Under termsofthe negotiated

relief offers immediate, industry immediate, offers relief

3 -

ranging injunctive relief which gives gives which relief injunctive ranging settlement of this matter to the benefit of to all Class members equally and provide provide and equally members Class all to have diligently investigated and — - leading privacy protection, and and protection, privacy leading nable” standard required for the very thing the VPPA was was VPPA the thing very the the the

class action.evidence andwitnessesacrossthe Moreover, from country wouldhaveto be myri and consultants, technical witnesses, expert for expenses including trial, to proceed to matter this were incurred complexity ofprotracted litigation wouldbesubstantial. Significant costs wouldbe favor of merits, the viability of Blockbuster’s factual and legal defenses to the claims counsels in ins the disputes the validity of such a defense, but it nonetheless informed the decision to accept for the purpose for which [they were] collected” Blockbuster will al sale and the amount of time that it has been retaining Plaintiff’s and the Class’s PII, Court’s approval of the sale bars this Action. cor Defendant’s (“DISH”), Corporation Network DISH to records, customer assets,including BB”) (“Old Inc.’s Blockbuster would argue that secured by it, all the more defenses to Plaintiffs’ claims, making this Settlement, and the immediate injunctive relief risky. inherently is litigation of their claims and in their ability to ultimately prevail at trial CASE 0:11-cv-02559-JRT-JSMDocument41-2Filed07/03/12Page5of22 tant settlement. settlement. tant 12. 14. 13. avoiding the risks inherent in litigation.

In the absence of s of absence the In While Plaintiff believes he would more likely than not succeed on the colorable raiseseveral would Blockbuster proceed, to were litigation the If so likely argue that it has not retained the PII longer than

reasonable. Specifically, as set forth in its motion to dismiss, dismiss, to itsmotion in assetforth Specifically, reasonable. porate parent, on April 14, 2011, and that the Bankruptcy

the Bankruptcy Court approved the sale of Blockbuster, Blockbuster, of sale the approved Court Bankruptcy the ad other costs necessitated bythe trial ofanationwide ettle ment, it is certain that the expense, duration, and 4

Further, given the timing of the bankruptcy

in violation of the VPPA. VPPA. the of violation in , they also recognize that that recognize also , they Plaintiff “necessary

Executed on July 3, 2012 at P assembled. arty wouldlikely appeal. CASE 0:11-cv-02559-JRT-JSMDocument41-2Filed07/03/12Page6of22 I declare under penalty of perjury that the foregoing is true and correct. and istrue foregoing the that perjury of penalty under I declare 15.

Given the complexity and novelty of the iss

Lakeside

, Michigan

. /s/ Jay Edelson Jay /s/

ues in this case, the defeated

CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 7 of 22

! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! EXHIBIT 2-A CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 8 of 22

EDELSON MCGUIRE, LLC FIRM RESUME

EDELSON MCGUIRE, LLC is a commercial litigation and legal consulting firm with attorneys in Illinois, Florida, New York, Colorado and California. The firm has several primary practice groups: plaintiffs’ class action litigation (with a particular emphasis on technology cases), e-discovery and information technology, general commercial litigation and legal and political consulting.

Our attorneys have been recognized as leaders in these fields by state and federal legislatures, national and international media groups, the courts, and our peers. Our reputation for leadership in class action litigation has led state and federal courts to appoint us lead counsel in many high-profile class action suits, including the recent Thomas the Tank Engine lead paint class actions, the AT&T mobile content class actions, the home equity credit reduction cases, and privacy class actions involving T-Mobile, Facebook, and Netflix. We have testified before the United States Senate on class action issues and have repeatedly been asked to work on federal and state legislation involving cellular telephony, privacy and other issues. Our attorneys have appeared on dozens of national and international television and radio programs to discuss our cases and class action and consumer protection issues more generally. Our attorneys speak regularly at seminars on consumer protection and class action issues, lecture on class actions at law schools and are asked to serve as testifying experts in cases involving class action and consumer issues.

PLAINTIFFS’ CLASS AND MASS ACTION PRACTICE GROUP

EDELSON MCGUIRE is a leader in plaintiffs’ class and mass action litigation, with a particular emphasis on technology class actions, and has been called a “class action ‘super firm’” by a national organization. (Decalogue Society of Lawyers, Spring 2010.) As has been recognized by federal courts, our firm has an “extensive histor[y] of experience in complex class action litigation, and [is a] well-respected law firm[] in the plaintiffs’ class action bar.” In re Pet Food Prod. Liab. Litig., MDL Dkt. No. 1850, No. 07-2867 (NLH) (D.N.J. Nov. 18, 2008). A leading arbitrator concurred: “The proof of [the firm’s] experience, reputation, and abilities is extraordinary. . . . Each [of their cases] elaborates on the experience and unique success [they] have had in achieving leading roles in the area of 'technology consumer protection class actions.'” (Arbitration award in mobile content class action settlement, August 6, 2009) In appointing Edelson McGuire interim co-lead in one of the most high profile cases in the country, a federal court pointed to our ability to be “vigorous advocates, constructive problem-solvers, and civil with their adversaries." -In Re JPMorgan Chase Home Equity Line of Credit Litig., No. 10 C 3647 (N.D.Ill, July 16, 2010).

We have been specifically recognized as "pioneers in the electronic privacy class action field, having litigated some of the largest consumer class actions in the country on this issue." In re Facebook Privacy Litig., No. C 10-02389 (N.D.Cal) (order appointing Edelson McGuire interim co-lead of privacy class action); see also In re Netflix Privacy Litigation, 5:11-cv-00379 (N.D.Cal. Aug. 12, 2011) (appointing Edelson McGuire sole lead counsel due, in part, to its “significant and particularly specialized expertise in electronic privacy litigation and class actions[.]”)

EDELSON MCGUIRE Firm Resume as of May 2012 CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 9 of 22

We have several sub-specialties within our plaintiffs’ class and mass action practice group:

Consumer Technology Class Actions: We have established the key precedent under the Telephone Consumer Protection Act concerning text message spam, resulting in multiple eight figure settlements in recent years. We have prosecuted over 100 cases involving mobile content, settling numerous nationwide class actions, including against industry leader AT&T Mobility, collectively worth over a hundred million dollars.

Representative Settlements:

• McFerren v. AT&T Mobility, LLC, No. 08-CV-151322 (Fulton County Sup. Ct., GA): Lead counsel class action settlement involving 16 related cases against largest wireless service provider in the nation. “No cap” settlement provided virtually full refunds to a nationwide class of consumers who alleged that unauthorized charges for mobile content were placed on their cell phone bills. • Paluzzi v. Cellco Partnership, No. 07 CH 37213 (Cook County, Illinois): Lead counsel in class action settlement involving 27 related cases alleging unauthorized mobile content charges. Case settled for $36 million. • Lozano v. 20th Century Fox, No. 09-cv-05344 (N.D.Ill): Lead counsel in class action alleging that defendants violated federal law by sending unsolicited text messages to cellular telephones of consumers. Case settled for $16 million. • Gray v. Mobile Messenger Americas, Inc., No. 08-CV-61089 (S.D. Fla.): Lead counsel in case alleging unauthorized charges were placed on cell phone bills. Case settled for $12 million. • Parone v. m-Qube, Inc. No. 08 CH 15834 (Cook County, Illinois): Lead counsel in class action settlement involving over 2 dozen cases alleging the imposition of unauthorized mobile content charges. Case settled for $12.254 million. • Kramer v. B2Mobile, et al, No. 0"cv"02722"CW)(N.D.Cal.):))Lead)counsel) in class action alleging that defendants violated federal law by sending unsolicited text messages to cellular telephones of consumers. Case settled for $12.2 million. • Satterfield v. Simon & Schuster, No. C 06 2893 CW (N.D. Cal.). Co-lead counsel in class action alleging that defendants violated federal law by sending unsolicited text messages to cellular telephones of consumers. Case settled for $10 million. • Williams, et al. v. Motricity, Inc. et al., Case No. 09 CH 19089 (Cook County, Illinois): Lead counsel in class action settlement involving 24 cases alleging the imposition of unauthorized mobile content charges.

EDELSON MCGUIRE Firm Resume as of May 2012 CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 10 of 22

Case settled for $9 million. • VanDyke v. Media Breakaway, LLC, No. 08 CV 22131 (S.D. Fla.): Lead counsel in class action settlement alleging unauthorized mobile content charges. Case settled for $7.6 million. • Weinstein, et al. v. Airit2me, Inc., Case No. 06 C 0484 (N.D. Ill): Co-lead counsel in class action alleging that defendants violated federal law by sending unsolicited text messages to cellular telephones of consumers. Case settled for $7 million.

• Gresham v. Cellco Partnership, No. BC 387729 (Los Angeles Sup. Ct.): Lead counsel in case alleging unauthorized charges were placed on cell phone bills. Settlement provided class members with full refunds. • Duffy v. Nevis Mobile, LLC, No. 08 CH 21376 (Cir. Ct. Cook County, IL): Class counsel in certified class action against mobile content provider for unauthorized mobile content charges resulting in default judgment over $10 million. • Zurakov v. Register.com, No. 01-600703 (New York County, NY): Co- lead counsel in a class action brought on behalf of an international class of over one million members against Register.com for its deceptive practices in registering Internet domain names. Settlement required Register.com to fully disclose its practices and provided the class with relief valued in excess of $17 million.

Privacy/Data Loss Class Actions: We have litigated numerous class actions involving issues of first impression against Facebook, Apple, Netflix, Sony, Red Box, Pandora, Sears, Storm 8, Google, T-Mobile, Microsoft and others involving the failure to protect customers’ private information, some resulting from security breaches.

Representative Cases:

• In re Facebook Privacy Litigation, 10-cv-02389 (N.D. Cal.): Appointed co-lead counsel in suit alleging that Facebook unlawfully shared its users' sensitive personally identifiable information with Facebook's advertising partners. • In re Netflix Privacy Litigation, 5:11-cv-00379 (N.D.Cal.): Sole lead counsel in suit alleging that defendant violated the Video Privacy Protection Act by illegally retaining customer viewing information. • In re Zynga Privacy Litigation, 10-cv-04680 (N.D. Cal.): Apponted co- lead counsel in suit against gaming application designer for the alleged unlawful disclosure of its users' personally identifiable information to advertisers and other third parties.

EDELSON MCGUIRE Firm Resume as of May 2012 CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 11 of 22

• Gaos v. Google, 10-cv-04809 (N.D. Cal.): Part of a team of attorneys in suit alleging that Google unlawfully disclosed its users' search queries to website owners and other third parties. • In re Sidekick Litig. , No. C 09-04854-JW (N.D. Cal.): Co-lead counsel in cloud computing data loss case against T-Mobile and Microsoft. Settlement provided the class with potential settlement benefits valued at over $12 million. • Abrams v. Facebook, Inc., No. 07-05378 (N.D. Cal.): Lead counsel in injunctive settlement concerning the transmission of allegedly unauthorized mobile content. • Desantis v. Sears, 08 CH 00448 (Cook Cty): Lead counsel in injunctive settlement alleging national retailer allowed purchase information to be publicly available through the internet.

Products Liability Class Actions: We have been appointed lead counsel in state and federal products liability class settlements, including a $30, million settlement resolving the “Thomas the Tank Engine” lead paint recall cases and a $32 million settlement involving the largest pet food recall in the history of the United States and Canada.

Representative Settlements:

• Barrett v. RC2 Corp., No. 07 CH 20924 (Cir. Ct. Cook County, IL): Co- lead counsel in lead paint recall case involving Thomas the Tank toy trains. Settlement is valued at over $30 million and provided class with full cash refunds and reimbursement of certain costs related to blood testing.

• In re Pet Food Products Liability Litig., No. 07-2867 (D. N.J.): Part of mediation team in class action involving largest pet food recall in United States history. Settlement provided $24 million common fund and $8 million in charge backs.

Banking Class Actions: Edelson McGuire has been at the forefront of class action litigation arising in the aftermath of the federal bailouts of the banks. Its suits include claims that the certain banks unlawfully suspended home credit lines based on pre-textual reasons, and that certain banks have failed to honor loan modification programs.

Representative Cases:

• Hamilton v. Wells Fargo Bank, N.A., 4:09-cv-04152-CW (N.D. Cal.). Lead counsel in class actions challenging Wells Fargo’s suspensions of home equity lines of credit. Nationwide settlement restores access to over $1 billion in credit and provides industry leading service enhancements and injunctive relief.

EDELSON MCGUIRE Firm Resume as of May 2012 CASE 0:11-cv-02559-JRT-JSM Document 41-2 Filed 07/03/12 Page 12 of 22

• In re JP Morgan Chase Bank Home Equity Line of Credit Litig., 10-cv- 3647 (N.D. Ill.): Court appointed interim co-lead counsel in nationwide putative class action alleging illegal suspensions of home credit lines.

• Levin v. Citibank, N.A., C-09-0350 MMC (N.D. Cal.): Court appointed interim co-lead counsel in nationwide putative class action alleging illegal suspensions of home credit lines.

• Settled numerous consumer class actions alleging fraud or other unconscionable behavior by banks and other lenders.

General Consumer Protection Class Actions: We have successfully prosecuted countless class action suits against health clubs, dating agencies, phone companies, debt collectors, and other businesses on behalf of consumers.

Representative Settlements:

• Pulcini v. Bally Total Fitness Corp., No. 05 CH 10649 (Cir. Ct. Cook County, IL): Co-lead counsel in four class action lawsuits brought against two health clubs and three debt collection companies. A global settlement provided the class with over $40 million in benefits, including cash payments, debt relief, and free health club services.

• Kozubik v. Capital Fitness, Inc., 04 CH 627 (Cir. Ct. Cook County, IL): Co-lead counsel in state-wide suit against a leading health club chain, which settled in 2004, providing the over 150,000 class members with between $11 million and $14 million in benefits, consisting of cash refunds, full debt relief, and months of free health club membership.

• Kim v. Riscuity, No. 06 C 01585 (N.D. Ill): Co-lead counsel in suit against a debt collection company accused of attempting to collect on illegal contracts. The case settled in 2007, providing the class with full debt relief and return of all money collected.

• Jones v. TrueLogic Financial Corp., No. 05 C 5937 (N.D. Ill): Co-lead counsel in suit against two debt collectors accused of attempting to collect on illegal contracts. The case settled in 2007, providing the class with approximately $2 million in debt relief.

• Fertelmeyster v. Match.com, No. 02 CH 11534 (Cir. Ct. Cook County, IL): Co-lead counsel in a state-wide class action suit brought under Illinois consumer protection statutes. The settlement provided the class with a collective award with a face value in excess of $3 million.

• Cioe v. Yahoo!, Inc., No. 02 CH 21458 (Cir. Ct. Cook County, IL): Co- lead counsel in a state-wide class action suit brought under state consumer

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protection statutes. The settlement provided the class with a collective award with a face value between $1.6 million and $4.8 million.

Insurance Class Actions: We have prosecuted and settled multi-million dollar suits against J.C. Penney Life Insurance for allegedly illegally denying life insurance benefits under an unenforceable policy exclusion and against a Wisconsin insurance company for terminating the health insurance policies of groups of self- insureds.

Representative Settlements:

• Holloway v. J.C. Penney, No. 97 C 4555, (N.D. Ill.): One of the primary attorneys in a multi-state class action suit alleging that the defendant illegally denied life insurance benefits to the class. The case settled in or around December of 2000, resulting in a multi-million dollar cash award to the class.

• Ramlow v. Family Health Plan (Wisc. Cir. Ct., WI): Co-lead counsel in a class action suit challenging defendant's termination of health insurance to groups of self-insureds. The plaintiff won a temporary injunction, which was sustained on appeal, prohibiting such termination and eventually settled the case ensuring that each class member would remain insured.

Mass/Class Tort Cases: Our attorneys were part of a team of lawyers representing a group of public housing residents in a suit based upon contamination related injuries, a group of employees exposed to second hand smoke on a riverboat casino, and a class of individuals suing a hospital and national association of blood banks for failure to warn of risks related to blood transfusions.

Representative Cases:

• Aaron v. Chicago Housing Authority, 99 L 11738, (Cir. Ct. Cook County, IL): Part of team representing a group of public housing residents bringing suit over contamination-related injuries. Case settled on a mass basis for over $10 million.

• Januszewski v. Horseshoe Hammond, No. 2:00CV352JM (N.D. Ind.): Part of team of attorneys in mass suit alleging that defendant riverboat casino caused injuries to its employees arising from exposure to second- hand smoke.

The firm's cases regularly receive attention from local, national, and international media. Our cases and attorneys have been reported in the Chicago Tribune, USA Today, the Wall Street Journal, the New York Times, the LA Times, by the Reuters and UPI news services, and BBC International. Our attorneys have appeared on numerous national television and radio programs, including ABC World News, CNN, Fox News, NPR, and CBS Radio, as well as television and radio programs outside of the United States. We have also been called upon to give

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congressional testimony and other assistance in hearings involving our cases.

GENERAL COMMERCIAL LITIGATION

Our attorneys have handled a wide range of general commercial litigation matters, from partnership and business-to-business disputes, to litigation involving corporate takeovers. We have handled cases involving tens of thousands of dollars to “bet the company” cases involving up to hundreds of millions of dollars. Our attorneys have collectively tried hundreds of cases, as well as scores of arbitrations and mediations. All of our attorneys have regularly practiced in state and federal trial and appellate courts.

E-DISCOVERY AND INFORMATION TECHNOLOGY

Led by nationally-recognized eDiscovery expert Steven Teppler, our firm has taken the lead on eDiscovery issues including data protection, information technology, document management and retrieval, loss or destruction of information, and authentication and admissibility issues uniquely inherent to computer generated information. This includes spoliation allegations arising from acts of unauthorized or illegal data manipulation or alteration.

LEGAL AND POLITICAL CONSULTING

Legal and political consulting is an area of practice that sets EDELSON MCGUIRE apart from other law firms. The firm advises on governmental and consumer issues and has helped its clients formulate business and legislative strategies, revise contractual and advertising material, and implement consumer protection strategies more generally. Our clients range from small Internet start-ups, to bricks and mortar companies, to one of the most trafficked Internet marketers, content and commerce firms in the country.

OUR ATTORNEYS

JAY EDELSON is the founder and Managing Partner of Edelson McGuire. He has been recognized as a leader in class actions, technology law, corporate compliance issues and consumer advocacy by his peers, the media, state and federal legislators, academia and courts throughout the country.

Jay has been appointed lead counsel in numerous state, federal, and international class actions, resulting in hundreds of millions of dollars for his clients. He is regularly asked to weigh in on federal and state legislation involving his cases. He testified to the U.S. Senate about the largest pet food recall in the country's history and is advising state and federal politicians on consumer issues relating to the recent federal bailouts, as well as technology issues, such as those involving mobile marketing. Jay also counsels companies on legal compliance and legislative issues in addition to handling all types of complex commercial litigation.

Jay has litigated class actions that have established precedent concerning the ownership rights of domain name registrants, the applicability of consumer protection statutes to Internet businesses, and the interpretation of numerous other state and federal statutes including the Telephone Consumer Protection Act and the Video Privacy Protection Act. As lead counsel, he has also

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secured settlement in cases of first impression involving Facebook, Microsoft, AT&T and countless others, collectively worth hundreds of millions of dollars.

In addition to technology based litigation, Jay has been involved in a number of high-profile "mass tort" class actions and product recall cases, including cases against Menu Foods for selling contaminated pet food, a $30 million class action settlement involving the Thomas the Tank toy train recall, and suits involving damages arising from second-hand smoke.

In 2009, Jay was named one of the top 40 Illinois attorneys under 40 by the Chicago Daily Law Bulletin. In giving Jay that award, he was heralded for his history of bringing and winning landmark cases and for his “reputation for integrity” in the “rough and tumble class action arena.” In the same award, he was called “one of the best in the country” when it “comes to legal strategy and execution.” Also in 2009, Jay was included in the American Bar Association’s “24 hours of Legal Rebels” program, where he was dubbed one of “the most creative minds in the legal profession” for his views of associate training and firm management. In 2010, he was presented with the Annual Humanitarian Award in recognition of his “personal integrity, professional achievements, and charitable contributions” by the Hope Presbyterian Church. In 2011, he was selected as an Illinois Super Lawyer and, separately, as a top Illinois class action lawyer by Benchmark Plaintiff.

Jay is frequently asked to participate in legal seminars and discussions regarding the cases he is prosecuting, including serving as panelist on national symposium on tort reform and, separately, serving as a panelist on litigating high-profile cases. He has also appeared on dozens of television and radio programs to discuss his cases. He has taught classes on class action law at Northwestern Law School and The John Marshall Law School, and has co-chaired a 2-day national symposium on class action issues. He has been an adjunct professor, teaching a seminar on class action litigation at Chicago-Kent College of Law since 2010.

Jay is a graduate of Brandeis University and the University of Michigan Law School.

MYLES MCGUIRE is a Partner at EDELSON MCGUIRE. His practice concentrates on consumer protection law, class actions, and legal and political consulting to technology companies. Prior to entering private practice, Myles spent several years operating an Internet advertising company, which was later sold, in addition to counseling high-tech companies on legal issues.

Since turning to plaintiffs’ advocacy, Myles has had principle control over many nationwide and multi-state class actions. Drawing on his technological background, his specific area of emphasis is on emerging technology class actions, including those involving electronic commerce, cellular telephony and wireless media, among others. He has served in leadership positions in groundbreaking settlements involving Facebook, Verizon, Sprint, and T-Mobile.

Due to his diverse legal and business expertise, Myles has been asked by members of Congress to comment on proposed legislation in the mobile content industry and has worked with state regulatory bodies in related efforts.

Myles graduated from Marquette University Law School in 2000 and is admitted to practice in Wisconsin and Illinois. He is a member of the National Association of Consumer Advocates and the Chicago Bar Association.

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RYAN D. ANDREWS is a Partner at Edelson McGuire, LLC and the Chair of the Telecommunications Practice Group. Mr. Andrews has been appointed class counsel in numerous state and federal class actions nationwide that have resulted in nearly $100 million dollars in refunds to consumers, including Satterfield v. Simon & Schuster, Inc., No. C 06 2893 CW (N.D. Cal.), Gray v. Mobile Messenger Americas, Inc., No. 08-CV-61089 (S.D. Fla.), Lofton v. Bank of America Corp., No. 07-5892 (N.D. Cal.), Paluzzi v. Cellco Partnership, No. 07 CH 37213 (Cook County, Ill.), Parone v. m-Qube, Inc. No. 08 CH 15834 (Cook County, Ill.), and Kramer v. Autobytel, Inc., No. 10-cv-2722 (N.D. Cal. 2010).

In addition, Mr. Andrews has achieved groundbreaking court decisions protecting consumers through the application of the Telephone Consumer Protection Act to emerging text-messaging technology. Representative reported decisions include: Lozano v. Twentieth Century Fox, 702 F. Supp. 2d 999 (N.D. Ill. 2010), Satterfield v. Simon & Schuster, Inc. 569 F.3d 946 (9th Cir. 2009), and Kramer v. Autobytel, Inc., 759 F. Supp. 2d 1165 (N.D. Cal. 2010), In re Jiffy Lube Int’l Text Spam Litig, --- F. Supp. 2d ---, No. 11-md-2261, 2012 WL 762888 (S.D. Cal. March 9, 2012).

Mr. Andrews received his J.D. with High Honors from the Chicago-Kent College of Law and was named Order of the Coif. Recently, Mr. Andrews has returned to Chicago-Kent as an Adjunct Professor of Law, teaching a third-year seminar on Class Actions. While in law school, Mr. Andrews was a Notes & Comments Editor for The Chicago-Kent Law Review, as well as a teaching assistant for both Property Law and Legal Writing courses. Mr. Andrews externed for the Honorable Joan B. Gottschall in the United State District Court for the Northern District of Illinois, and earned CALI awards for the highest grade in five classes.

A native of the Detroit area, Mr. Andrews graduated from the University of Michigan, earning his B.A., with distinction, in Political Science and Communications.

Mr. Andrews is licensed to practice in Illinois state courts, the United States District Court for the Northern District of Illinois, the U.S. Court of Appeals for the Seventh Circuit, and the U.S. Court of Appeals for the Ninth Circuit.

RAFEY S. BALABANIAN is a Partner and Group Chair at EDELSON MCGUIRE. Rafey focuses his practice on prosecuting consumer technology class actions, banking class actions, and general consumer class actions. He is also co-chair of Edelson McGuire’s business litigation group.

On the plaintiff’s side, Rafey has been the court appointed lead counsel in numerous high-stakes class action litigation and has obtained settlements in excess of $50 million.

On the business litigation side, Rafey has represented individual and corporate clients in a wide variety of complex cases, including commercial disputes seeking damages of $60 million and several “bet the company” cases.

Rafey has first-chaired both jury and bench trials, engaged in extensive motion practice, and acted as lead counsel in several mediations and arbitrations.

Rafey received his J.D. from the DePaul University College of Law in 2005. While in law school, Rafey received a certificate in international and comparative law and earned the CALI

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award for the highest grade in advanced trial advocacy. Rafey received his B.A. in History, with distinction, from the University of Colorado – Boulder in 2002.

STEVEN LEZELL WOODROW is a Partner and Group Chair at EDELSON MCGUIRE and the firm’s hiring attorney. Steven has successfully litigated and settled a number of consumer protection cases through trial, engaged in extensive motion practice, drafted appellate briefs, prosecuted class actions and participated in multi-session mediations.

Prior to joining the firm, Steven was a litigator at a Chicago boutique focusing on consumer protection matters, real estate disputes, fraudulent transfers in bankruptcy and the prosecution of white-knight mortgage fraud cases.

Steven received his J.D. from Chicago-Kent College of Law with High Honors, Order of Coif, while earning his certificate in litigation and alternative dispute resolution. During law school, he served as a Judicial Extern for the Honorable Ann C. Williams on the Seventh Circuit Court of Appeals and as President of the Student Bar Association. Steven also served as a Notes and Comments Editor for THE CHICAGO-KENT LAW REVIEW and represented Chicago-Kent at the National Sports Law Moot Court Competition in New Orleans in 2004. Steven was awarded the ABA-ALI Scholarship and Leadership Award for best representing the combination of leadership and scholarship in his graduating class and also received the Lowell H. Jacobson Memorial Scholarship, which is awarded competitively to a student from one of the law schools in the Seventh Circuit to recognize personal commitment and achievement.

Steven received his B.A. in Political Science, with Distinction, from the University of Michigan—Ann Arbor in 2002.

SEAN P. REIS is Of Counsel to EDELSON MCGUIRE . Sean is an experience trial attorney and business litigator. Sean has experience in a wide-range of litigation matters, including those involving trade secrets, real estate fraud, employment, and consumer issues. Sean has tried sixteen cases, including several multi-week jury trials.

Prior to joining Edelson McGuire, Sean was trained at an international law firm and later founded his own practice. In 1993, Sean graduated from University of California at San Diego with a degree in quantative economics. Following that Sean graduated from Rutgers University School of Law, Newark, where he was the business editor of the Rutgers Law Review and where he received the graduation for appellate advocacy.

STEVEN W. TEPPLER is Of Counsel to EDELSON MCGUIRE. Steven concentrates his practice on data protection and information technology law, including electronic discovery, loss or destruction of information, authentication and admissibility issues uniquely inherent to computer generated information, including spoliation issues arising from unauthorized or illegal data manipulation or alteration. He is the Co-Vice-Chair of the American Bar Association Information Security Committee as well as the Florida Bar’s Professional Ethics Committee.

Steven has authored over a dozen articles relating to information technology law and routinely presents his work at conferences. Steven’s recent publications include: Spoliation in the Digital Universe, The SciTech Lawyer, Science and Technology Law Section of the American Bar Association, Fall 2007; Life After Sarbanes-Oxley – The Merger of Information Security and

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Accountability (co-author), 45 JURIMETRICS J. 379 (2005); Digital Signatures Are Not Enough (co-author), Information Systems Security Association, January 2006; State of Connecticut v. Swinton: A Discussion of the Basics of Digital Evidence Admissibility (co-author), Georgia Bar Newsletter Technology Law Section, Spring 2005; The Digital Signature Paradox (co-author), IETF Information Workshop (The West Point Workshop) June 2005; Observations on Electronic Service of Process in the South Carolina Court System, e-filing Report, June 2005. Steven is also a contributing author to an American Bar Association book with the working title “Foundations of Digital Evidence” (publication expected March 2009).

Steven graduated from the Benjamin N. Cordozo School of Law in 1980 after earning his B.A., summa cum laude, from the City College of New York in 1977. Steven is admitted to the bars of New York, the District of Columbia and Florida.

EVAN M. MEYERS is Senior Counsel at EDELSON MCGUIRE. Evan is an experienced trial and appellate litigator and has handled a broad range of complex litigation matters, including contract disputes, securities and consumer fraud, employment discrimination, insurance coverage, antitrust, shareholder and tax disputes, business torts and other matters. Evan has managed all aspects of the litigation process, including evaluation and strategic analysis, drafting pleadings in state and federal trial and appellate courts, taking and defending depositions, arguing motions, and representing clients in mediations and settlement conferences. He has also successfully tried cases in state court.

Prior to joining Edelson McGuire, Evan worked at Drinker Biddle & Reath LLP, where he was an associate in the firm’s commercial litigation practice group and represented a wide range of clients in federal and state courts, including manufacturers, insurance and financial services companies, government agencies, close corporations, hospitals, colleges and universities and not- for-profit entities.

Evan received his J.D., cum laude, from the University of Illinois College of Law in 2002, where he was an associate editor of the Elder Law Journal. Additionally, he served as a judicial extern with the Hon. Wayne R. Andersen of the U.S. District Court for the Northern District of Illinois. Evan received his bachelor's degree, with distinction, in political science from the University of Michigan in 1999.

BRAD BAGLIEN is an Associate at EDELSON MCGUIRE. Brad focuses his practice on privacy and technology class actions.

Brad previously worked for Sidley Austin LLP, where he represented a wide range of clients, including Fortune 100 companies, small businesses, and individuals. He has handled a variety of complex commercial litigation matters in state and federal courts, including consumer fraud actions, contract disputes, internal investigations, insurance class actions, and commercial tax litigation.

Brad graduated with honors from the University of Chicago Law School, where he participated in the Hinton Moot Court Competition and was an instructor in the Street Law program at several local high schools. During law school, Brad served as a judicial extern for the Honorable

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Mark Filip in the Northern District of Illinois.

Brad graduated from St. Olaf College with degrees in Economics and Political Science. While at St. Olaf, he was a captain of the baseball team and a member of the football team.

CHRISTOPHER L. DORE is an Associate at EDELSON MCGUIRE and a member of the Technology and Privacy Practice Group. Chris focuses his practice on emerging consumer technology issues, as well as prosecuting unsolicited text message and online fraud cases.

Chris has been appointed class counsel in multiple class actions, including ground breaking technology, text-spam, and fraudulent marketing cases. (Turner v. Storm8, LLC, (09-cv-05234) (N.D. Cal.) and Espinal v Burger King Corporation, (09-20982) (S.D. Fla.)).

Prior to joining Edelson McGuire, Chris worked for two large defense firms in the areas of employment and products liability.

Chris graduated magna cum laude from The John Marshall Law School, where he served as the Executive Lead Articles for the Law Review, as well as a team member for the D.M. Harish International Moot Court Competition in Mumbai, India. Chris has since returned to his alma mater to lecture on current issues in class action litigation.

Before entering law school, Chris received his Masters degree in Legal Sociology, graduating magna cum laude from the International Institute for the Sociology of Law, located in Onati, Spain. Chris received his B.A. in Legal Sociology from the University of California, Santa Barbara.

CHANDLER GIVENS is an Associate at EDELSON MCGUIRE, where his practice focuses on technology and privacy class actions. His lawsuits have centered on fraudulent software development, unlawful tracking of consumers through mobile devices and computers, and illegal data retention.

Chandler graduated from the University of Pittsburgh School of Law. While in law school, he was a research assistant for Cyberlaw Professor Dr. Kevin Ashley, and a judicial extern for the Honorable David S. Cercone of the United States District Court for the Western District of Pennsylvania. Chandler received CALI awards for the highest course grades in Negotiations as well as Telecommunications Law. He graduated cum laude from Virginia Tech, with a B.S. in business information technology, with a focus on computer-based decision support systems. Chandler sits on the ABA committees for Information Security and e-Discovery.

Before joining the legal profession, Chandler worked as a systems analyst. He is regularly invited to speak on issues ranging from network security to consumer privacy and Internet fraud. Chandler currently leads a team of technology investigative researchers at the firm.

Prior to starting with the firm, Chandler interned at the Virginia Attorney General’s Office and the U.S. Department of Justice in Washington, D.C.

JOHN OCHOA is an Associate at EDELSON MCGUIRE. John’s practice focuses on consumer

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class action litigation.

John graduated magna cum laude from the John Marshall Law School in May, 2010 and served as Managing Editor for the John Marshall Law Review. His student Comment, which examines bicycling and government tort immunity in Illinois, appears in Vol. 43, No. 1 of the JOHN MARSHALL LAW REVIEW. While in law school, John took advantage of various scholastic opportunities, serving as a research assistant, externing with Judge Thomas Hoffman at the Illinois Court of Appeals, and competing in the ABA National Appellate Advocacy Competition. John was awarded a Herzog scholarship for his academic performance and earned CALI awards for the highest grade in Torts, Property, and Administrative Law.

He received his B.A. with Honors in Political Science from the University of Iowa in 2004.

MEGAN PEKALA is an Associate at EDELSON MCGUIRE. Megan practices in the area of consumer class action, focusing on complex class actions in the banking industry.

Prior to joining Edelson McGuire, Megan worked for several years as a commercial loan underwriter and portfolio officer at Merrill Lynch, Pierce, Fenner & Smith. Megan also worked as an analyst in the troubled asset group at Bank of America, helping to monitor and restructure high-risk loans.

Megan received her J.D. from Chicago-Kent College of Law in May 2011. During law school Megan externed for the Honorable Judge Bauer in the Seventh Circuit Court of Appeals and served as Vice President-Evening Division of the Student Bar Association and Vice President of the Moot Court Honor Society. Megan also represented Chicago-Kent at the National First Amendment Moot Court Competition in Nashville, Tennessee and the National Cultural Heritage Law Moot Court Competition in Chicago, Illinois, and earned the CALI award for obtaining the highest grade in Legal Writing I, Legal Writing II and Trial Advocacy II courses.

Megan graduated with High Honors from DePaul University in July 2005, earning her B.S. in Finance.

EVE-LYNN RAPP is an Associate at EDELSON MCGUIRE. Eve-Lynn focuses her practice in the areas of consumer and technology class action litigation.

Prior to joining Edelson McGuire, Eve-Lynn was involved in numerous class action cases in the areas of consumer and securities fraud, debt collection abuses and public interest litigation. Eve- Lynn has substantial experience in both state and federal courts, including successfully briefing issues in both the United States and Illinois Supreme Courts.

Eve-Lynn received her J.D. from Loyola University of Chicago-School of Law, graduating cum laude, with a Certificate in Trial Advocacy. During law school, Eve-Lynn was an Associate Editor of Loyola’s International Law Review and externed as a “711" at both the Cook County State’s Attorney’s Office and for Cook County Commissioner Larry Suffredin. Eve-Lynn also clerked for both civil and criminal judges (The Honorable Judge Yvonne Lewis and Plummer Lott) in the Supreme Court of New York.

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Eve-Lynn graduated from the University of Colorado, Boulder, with distinction and Phi Beta Kappa honors, receiving a B.A. in Political Science.

BENJAMIN H. RICHMAN is an Associate at EDELSON MCGUIRE and is a member of the firm’s Corporate Governance and Business Litigation Practice Group. He handles plaintiff’s-side consumer class actions, focusing mainly on technology-related cases, represents corporate defendants in class actions, and handles general commercial litigation matters.

On the plaintiff’s side, Ben has brought industry-changing lawsuits involving the marketing practices of the mobile industry, print and online direct advertisers, and Internet companies. He has successfully prosecuted cases involving privacy claims and the negligent storage of consumer data. His suits have also uncovered complex fraudulent methodologies of Web 2.0 companies, including the use of automated bots to distort the value of consumer goods and services. In total, his suits have resulted in hundreds of millions of dollars to consumers.

On the defense side, Ben has represented large institutional lenders in the defense of employment class actions. He also routinely represents technology companies in a wide variety of both class action defense and general commercial litigation matters.

Ben received his J.D. from The John Marshall Law School, where he was an Executive Editor of the Law Review and earned a Certificate in Trial Advocacy. While in law school, Ben served as a judicial extern to the Honorable John W. Darrah of the United States District Court for the Northern District of Illinois, in addition to acting as a teaching assistant for Prof. Rogelio Lasso in several torts courses. Ben has since returned to the classroom as a guest-lecturer on issues related to class actions, complex litigation and negotiation. He also lectures incoming law students on the core first year curriculums. Before entering law school, Ben graduated from Colorado State University with a B.S. in Psychology.

Ben is the director of Edelson McGuire’s Summer Associate Program.

ARI J. SCHARG is an Associate at EDELSON MCGUIRE. He handles all aspects of litigation from pre-filing investigation through trial. In addition to class action litigation, Ari has substantial experience litigating commercial, real estate, employment, and constitutional matters. He also counsels entrepreneurs and works closely with startup companies to manage risk and raise capital.

Prior to joining the firm, Ari worked as a litigation associate at a large Chicago firm, where he represented a wide range of clients including Fortune 500 companies and local municipalities. His work included representing the Cook County Sheriff’s Office in several civil rights cases and he was part of the litigation team that forced Craigslist to remove its “Adult Services” section from its website. He also regularly tries his cases before judges and juries, including a trial that spanned six months.

Ari is very active in community groups and legal industry associations. He is a member of the Board of Directors of the Chicago Legal Clinic, an organization that provides legal services to low-income families in the Chicago area. Ari acts as Outreach Chair of the Young Adult Division of American Committee for the Shaare Zedek Medical Center in Jerusalem, and is

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actively involved with the Anti-Defamation League. He is also a member of the Standard Club Associates Committee.

Ari received his B.A. in Sociology from the University of Michigan – Ann Arbor and graduated magna cum laude from The John Marshall Law School where he served as a Staff Editor for Law Review and competed nationally in trial competitions. During law school, he also served as a judicial extern to The Honorable Judge Bruce W. Black of the U.S. Bankruptcy Court for the Northern District of Illinois.

IRINA SLAVINA is an Associate at EDELSON MCGUIRE focusing on consumer class actions. As a Russian attorney, Irina obtained her LL.M degree in International and Comparative Law, with High Honors, from Chicago-Kent College of Law in 2003. Since that time Irina has had a unique legal career in the United States that started in a boutique law office in Chicago and progressed to the legal department of a major gaming and entertainment company on the east coast.

While working in-house with General Counsel, Irina gained extensive experience in drafting and negotiating company contracts and addressing the day-to-day legal inquiries of management. Irina handled patrons’ liability claims, worked with state and local government officials in obtaining and renewing company licenses, and assisted with all aspects of corporate governance and compliance.

Irina earned her J.D. from Chicago-Kent College of Law with High Honors, Order of Coif, in 2009. While in law school, Irina represented Chicago-Kent in the McGee National Civil Rights Moot Court Competition. Irina was also a member of the Chicago-Kent Law Review, and her student note on the issue of a casino liability to problem gambles was published in the March 2010 issue, 85 Chi.-Kent L. Rev. 369. Irina externed for the Honorable Susan E. Cox in the Northern District of Illinois, and earned the CALI award for obtaining the highest grade in Constitutional Law, Evidence, and Legal Writing III courses.

BEN THOMASSEN is an Associate at EDELSON MCGUIRE and is a member of the Banking and Financial Services Practice Group.

Ben received his J.D., magna cum laude, from Chicago-Kent College of Law, where he also earned his certificate in Litigation and Alternative Dispute Resolution and was named Order of the Coif. At Chicago-Kent, Ben was Vice President of the Moot Court Honor Society and competed in both the ABA National Appellate Advocacy and National Moot Court Competitions. Among other scholarships and awards, Ben earned seven CALI awards for the highest grade in Appellate Advocacy, Business Organizations, Conflict of Laws, Family Law, Personal Income Tax, Property, and Torts.

Before his legal career, Ben worked in and around the Chicago and Washington, D.C. areas, including freelance and firm-based work as a website designer/developer, and many years experience as a film projectionist and media technician for commercial theatres, museums, and educational institutions. Ben received his Bachelor of Arts, summa cum laude, from St. Mary’s College of Maryland and his Master of Arts from the University of Chicago.

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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MINNESOTA

BASEEM MISSAGHI, individually and ) Case No. 11-cv-02559-JRT-JSM on behalf of all others similarly situated, ) ) Plaintiff, ) LR 7.1(d) WORD COUNT ) COMPLIANCE CERTIFICATE v. ) REGARDING PLAINTIFF’S ) MEMORANDUM IN SUPPORT OF HIS BLOCKBUSTER L.L.C., a Delaware ) MOTION FOR PRELIMINARY corporation, ) APPROVAL OF CLASS ACTION ) SETTLEMENT Defendant. ) ) [Hon John R. Tunheim] )

I, Ari J. Scharg, certify that Plaintiff’s Memorandum in Support of his Motion for

Preliminary Approval of Class Action Settlement complies with Local Rule 7.1(d). The attached memorandum was prepared using Microsoft Word Version 2011 and its text, exclusive of the caption, signature text, and certificates of counsel, contains 8,492 words according to the Microsoft automatic word count function, which has been specifically applied to include all text, including headings, footnotes, and quotations. I further certify that the attached brief has a typeface of 13 points in Times New Roman and complies with District of Minnesota Local Rule 7.1(e).

Respectfully submitted,

Dated: July 3, 2012 /s/ Ari J. Scharg Ari J. Scharg EDELSON MCGUIRE, LLC 350 North LaSalle Street, Suite 1300 Chicago, Illinois 60654 Tel: (312) 589-6370 [email protected]