A magistrate judge scuttled a class action settlement against a debt collector, faulting an arrangement that paid no class members except the named plaintiff and instead made a payment to a consumer advocacy group.

Eastern District Magistrate Judge Gary Brown denied final approval in Graff v. United Collection Bureau, 12-cv-2402, questioning the nearly $40,000 cy pres payment to the National Consumer Law Center.

Coupled with other deficiencies in the approximately $465,000 pact—such as a “sweeping increase” in class size and a broad liability release—Brown said “the limitation of the settlement to a cy pres payment representing no measurable benefit to class members renders the settlement fundamentally unfair, unreasonable and inadequate.”