Game Changer delivers results

Legal terminology is not always easy for people to understand, unless you’re lawyer, paralegal or some other specialist who works in a law office.

But the legal doctrine “cy pres” (pronounced “sigh-pray”) has become more familiar in recent years to charitable organizations in Northeast Ohio and throughout the United States.

That’s because a growing number of these organizations have benefited from the distribution of unclaimed funds from class-action lawsuits, which is permitted through the cy pres doctrine.

And the catalyst behind this initiative is attorney Patrick Perotti, a partner in the Dworken & Bernstein law firm in Painesville.

Over the past 10 years, Perotti has used the cy pres doctrine to distribute more than $32 million in unclaimed class-action funds to charitable organizations around the country, with many of those based in Lake, Geauga and Cuyahoga counties.

Those funds have been directed to charities through a Dworken & Bernstein program called Ohio Lawyers Give Back. The program’s website explains that cy pres (derived from a French phrase meaning “as closely as possible”) this way: “When a class action is settled, plaintiff and defendant agree to a fund amount to pay all class members. Since many class members have moved, passed away, or can’t be found, millions of settlement dollars go unclaimed. That settlement money is intended to benefit the class — rather than revert to the wrongdoing defendant — so the ancient doctrine is now being used to distribute the unclaimed money to charities and nonprofits.”

Perotti’s pivotal role in establishing this program has earned him nationwide media attention and an array of accolades, including the American Association for Justice’s Trial Lawyers Care Award, Cornerstone of Hope’s Champion of Hope, the Association of Fundraising Professionals National Philanthropy Day Corporate Leadership Award and the Project Love Rescuer of Humanity Award,

Last month, Perotti garnered another honor when he received the 2017 Lake Geauga Fast Track 50 Game Changer Award during the event’s 2017 dinner and recognition program in early November.

The Game Changer Award is designed to recognize individuals, new products, companies, organizations or events that have presented a positive reflection of or generated favorable publicity for Lake and/ or Geauga counties.

“Being a game changer means making Lake and Geauga counties a better place for businesses but also for the community, including the needy,” Perotti said. “We do this by finding a new path, changing old rules, teaching others how to do the same.”

Launching cy pres

For Perotti, the path to using the cy pres doctrine and creating the Ohio Lawyers Give Back began about 14 years ago, after he settled a class-action lawsuit.

“We decided that our firm would handle the dissemination of the notices to the class members and claims payment since it was a smaller case,” Perotti said.

After the class members received their checks, Perotti’s assistant then asked him what should be done with the leftover money. She said money still remained in the bank account because of some class members who didn’t fill out their paperwork for the lawsuit, and others who couldn’t be located for various reasons.

“I responded, ‘I had never thought about that,’ ” Perotti said.

Perotti and the defense counsel did some research about what options there were for the unclaimed money.

While the defense attorney found that the money could revert back to the defendant, Perotti said his research yielded a much different option.

“I discovered an ancient doctrine called cy pres and how it allowed for the remainder of the funds to be distributed ‘as nearly as possible’ to charity,” he said.

He and the defense attorney compromised, allowing half to go back to the defendant, and the other half going to a number of different charities.

“It was at the follow-up meeting with the judge and defense counsel that they said, ‘I’ll bet you’ll never settle another case without cy pres!’ And of course they were right,” Perotti said.

The Ohio Lawyers Give Back program really kicked into gear in 2008, Perotti said, when he settled a classaction lawsuit and $14 million in unclaimed funds were left over.

“That so far, has been the largest single cy pres distribution,” he said.

Choosing charities

Selecting an array of charities to share in a single distribution of cy pres funds is done in several different ways, Perotti explained.

If a charity would like to be considered for a distribution, they need to go to www.ohiolawyersgiveback.- org and click on the “suggest a charity” tab,” he said. “The submission will come directly to our office where a file will be set up for that charity.”

To be eligible, charities need to be a 501(c)(3) organization and have been in operation for two years or more.

Another source for potential cy pres recipients are defendants in the class-action lawsuits spearheaded by Perotti.

“Many times, the defendant in the case offers suggestions for distributions, which are welcome,” he said. “They or someone from their company might serve on a particular nonprofit board. Their input is valuable and appreciated as they would have inside knowledge as to the programs and stewardship of the charities monies they’ve raised.”

When Ohio Lawyers Give Back selects charities, depending on the amount of the distribution, it tries to choose “a wide range of charities that would indirectly touch the class members that didn’t claim their money,” Perotti said.