A recent Law 360 story by Dean Seal, “Class Attys Seek $77.5M in Fees For Equifax Breach Deal,” reports that the attorneys who secured a $380.5 million cash fund for victims of Equifax Inc.'s massive 2017 data breach in Georgia federal court are asking for just over 20% of that fund in fees and another $1.2 million to cover expenses.
More than a dozen firms serving as co-lead counsel, co-liaison counsel, the plaintiffs' steering committee and their state court coordinating counsel all signed off on the request for $77.5 million in fees to compensate them for more than 31,000 hours of work that went into resolving the nationwide multidistrict litigation.
The amount comes in just under the $80.5 million allotted in the cash fund for attorney fees and expenses under the terms of the deal, considered to be the largest data breach settlement in history. "The requested fee is in line with — if not substantially lower than — awards in other class actions that have resulted in similarly impressive settlements," the firms told the judge.
The settlement, which received preliminary approval in July, also resolved investigations by the Federal Trade Commission, the Consumer Financial Protection Bureau and nearly every U.S. state attorney general into the 2017 breach that exposed Social Security numbers and other personal data of nearly 150 million people. The deal provided affected customers who filed claims with the option to accept either a cash payment of restitution or a decade of free credit monitoring.
While the FTC originally announced that the payout option would net claimants with a $125 payment, which had been set aside for those who already had credit monitoring services, it followed up in late July with an announcement that "overwhelming interest" in that option would substantially lower the per-person payout. Of the $300 million set aside for customers in the compensation fund, only $31 million had been allotted for the cash option, the agency said, with the remaining going toward the free credit monitoring — an option the FTC implored consumers to take, even if they already had credit monitoring services.
"This monitoring service is probably stronger and more helpful than any you may have already, because it monitors your credit report at all three nationwide credit reporting agencies, and it comes with up to $1 million in identity theft insurance and individualized identity restoration services," Robert Schoshinski, the assistant director of the FTC's Division of Privacy and Identity Protection, said in late July.
The deal also provided the CFPB with $100 million in civil penalties and $175 million to 48 U.S. states — all but Massachusetts and Indiana, which have filed their own suits against Equifax — as well as to the District of Columbia and Puerto Rico.
U.S. District Judge Thomas W. Thrash Jr. plans to hold a fairness hearing for the proposed deal on Dec. 12 — with a deadline for objectors and challengers set for Nov. 19 — but class counsel said on Oct. 29 that it expects its work to continue well after the deal gets final approval, as it will have to monitor the claims verification process, communicate with impacted class members and participate in any additional dispute resolution.
"Class counsel's oversight obligations and other responsibilities will continue until the settlement is fully implemented, which will not occur until many years in the future," the attorneys said, estimating that they will have to spend at least 10,000 additional hours over the next seven years on closing out the settlement. The attorneys said their requested fees are reasonable as a percentage of the customers' recovery, in light of the hours of work put in and given the complexity and importance of the case.