Recently a federal district court in New York granted final approval of a $386.5 million settlement, including over $77 million in attorneys’ fees, in a class action brought by investors alleging that various banks engaged in a conspiracy to fix prices of bonds issued by Fannie Mae and Freddie Mac. Investors claimed that the banks were artificially inflating the value of new bonds, overcharging buyers and underpaying sellers. The final order approves five settlements in the case.
In ruling, the court considered the plaintiffs’ request for attorneys’ fees. The court awarded over $77 million in attorneys’ fees from the settlement fund to plaintiffs’ attorneys for engaging in roughly 30,200 hours of work. Attorneys also received approximately $1.7 million in expenses, plus interest on the fee and expense awards. The attorneys’ fees represent 20% of the total settlement amount of $386.5 million. In addition to attorneys’ fees, the court also approved $400,000 in service awards to the class representatives, with the lead plaintiff receiving $300,000.