Principe

The district court approved a simultaneous settlement of a derivative class action lawsuit and a securities class action lawsuit. Wein-stein, one of the derivative plaintiffs, contests the derivative settlement only. The questions are whether the district court 1) had jurisdiction over the derivative plaintiffs’ claims, 2) properly responded to Weinstein’s settlement objections, or 3) abused its discretion by approving the settlement and the award of attorneys’ fees. We affirm.

I. FACTS

Pacific Enterprises was once a successful gas distribution utility company. In the late 1980s it tried to diversify its business by acquiring the Thrifty store chain, an oil and gas exploration company, and a number of retail drug store chains. The diversification program, as described by the district court, was “incredibly bad.” By 1992 Pacific Enterprises sold all of its non-utility assets and restructured its operations at a loss of approximately $750 million. It also eliminated its dividend for the first time in eighty years.

According to Weinstein Pacific Enterprises’s management later revealed their rationale for diversification. They feared that the SEC would limit utility holding company…