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Category: Billing Record / Entries

Virgin Urges Ninth Circuit to Vacate Attorney Fees in Wage Case

July 30, 2020

A recent Law 360 story by Linda Chiem, “Virgin Asks 9th Circ. To Ax $6M Atty Fee in Wage Spat” reports that Alaska Airlines and Virgin America asked the Ninth Circuit to vacate nearly $6 million in fees awarded to attorneys for a certified class of flight attendants who won $77 million in a long-running dispute over pay and rest breaks.  Virgin America Inc., which merged with Alaska Airlines Inc., filed an opening brief with the Ninth Circuit claiming that U.S. District Judge Jon S. Tigar in January signed off on $5.7 million in fees for the plaintiffs' attorneys without digging into whether their hours and calculations were properly justified.

The attorneys, who initially requested $13.2 million, but were awarded less than half that, are representing named plaintiff Julia Bernstein and flight attendants alleging Virgin America flouted California labor laws by not paying them for all hours worked, including overtime, and denying them state-mandated meal and rest breaks.  Judge Tigar had acknowledged that the attorney fee application was too vague, saying "the level of specificity at which plaintiffs have documented their time makes it difficult or impossible for Virgin to raise certain challenges that courts have found justified partial reductions in other cases."

Despite that critical flaw, according to the airline, the court accepted all of the hours that the plaintiffs' counsel claimed and awarded a $5.7 million fee award, subject to only a 5% general reduction in hours.  "That decision cannot stand," the airline said in the brief.  "Because the lack of detail in the fee application deprived Virgin of a fair adversarial process and did not allow meaningful judicial review, the fee award must be vacated for that reason alone."

Moreover, the class counsel's flawed lodestar consisted of nearly 4,500 hours of billable time, most of which was billed at an absolute "top of the market" rate of $750 per hour, according to the brief.  On top of that, Judge Tigar improperly approved $251,000 in court-related expenses for the plaintiffs' attorneys, Virgin argued.  "Most of the expenses that the district court awarded were for 'expert fees,' which are not recoverable under black-letter California law," the airline said.  "In addition, the district court erred by ignoring the rule that a party cannot recover expenses without submitting an itemized list and accompanying receipts.  The district court did not identify any exception to this rule, and it candidly acknowledged that plaintiffs' counsel failed to comply with it.  But the court awarded expenses anyway."

NJ Judge Wrongly Used Past Private Practice to Cut Attorney Fees

July 29, 2020

A recent Law 360 story by Bill Wichert, “NJ Judge Wrongly Used Private Practice Past to Cut Atty Fees” reports that a New Jersey state judge improperly relied on unpublished decisions and her own private practice experience when she gave class counsel a lower attorney fee award than class counsel asked for when it settled a suit against a car dealership, a state appellate panel said Wednesday in nixing the ruling.  The panel concluded in a published opinion that Superior Court Judge Mara Zazzali-Hogan — formerly with Gibbons PC — was wrong to cut the requested hourly rates for attorney Christopher J. McGinn and lawyers and a paralegal at the Wolf Law Firm LLC to about $120,772 in fees and costs, which undercut their request by more than $40,000.

"In rejecting class counsel's submissions and reducing the hourly rate for all the attorneys and the paralegal, the judge relied on her personal experience in private practice, a methodology rejected in Walker ... and considered four unpublished decisions," the three-judge panel said, citing the New Jersey Supreme Court's 2012 opinion in Walker v. Giuffre.  As for Judge Zazzali-Hogan's reliance on the unpublished decisions, the panel pointed to the state Supreme Court's 2008 opinion in Brundage v. Estate of Carambio, which acknowledged that "[state court] rule 1:36-3 'provides that "[n]o unpublished opinion shall constitute precedent or be binding upon any court."'"

"Under these circumstances, we are persuaded that the judge's reduction of the hourly rates was based upon consideration of inappropriate factors, and thus reflects a mistaken exercise of discretion," the panel said, adding in a footnote: "In remanding this matter, we make no finding or suggestion about what hourly rates ultimately should be deemed reasonable for this kind of case."  McGinn and the Wolf Law Firm, representing plaintiff Nina Seigelstein, appealed the judge's decision in the suit against Shrewsbury Motors Inc. and its principal, which claimed the dealership unlawfully charged customers documentary fees that were not itemized, court documents state.

Under the settlement in the case, the defendants agreed to pay $125 to each member of a 2,883-member class, court documents state.  The attorneys sought roughly $162,000 in fees and costs, with hourly rates ranging from $165 for the paralegal to $500 for McGinn and $765 for fellow lead attorney Andrew R. Wolf, court documents state.

To back up the proposed hourly rates, the attorneys submitted certifications from Wolf, McGinn and three other lawyers who didn't work on the case, as well as two state court decisions, court documents state.  Citing the unpublished cases and her "fifteen years of private practice," Judge Zazzali-Hogan in March 2019 reduced the hourly rates, which set McGinn's and Wolf's at $475 and $575, respectively.  The judge also reduced the billable hours and used a smaller contingency fee enhancement percentage than what the attorneys requested.

NALFA Welcomes Phillip Neiman, Esq., FCIArb

July 27, 2020

The National Association of Legal Fee Analysis (NALFA) is pleased to announce that Phillip Neiman, Esq., FCIArb has been named a Fellow of the association.

Mr. Neiman, a full-time neutral with JAMS in San Francisco, specializes in the resolution of complex business and commercial disputes.  He devotes much of his practice to securities and investment-related cases, including shareholder, partnership and M&A disputes, and has substantial experience in a range of other areas, including employment, insurance, IP, real property, professional liability, personal injury and privacy tort cases, as well as fintech and cannabis sector disputes.

Prior to establishing his ADR practice in 2004, Mr. Neiman spent a decade as CEO and General Counsel of a FINRA-registered investment bank.

Mr. Neiman has extensive experience resolving attorney fee disputes, both as an arbitrator ruling on contested fee petitions and as a mediator overseeing settlement negotiations with a fee component.  He has addressed a range of complex issues in contractual and statutory fee award cases, including lodestar adjustments, prevailing party determinations in partial success and disproportionate damages cases, multiparty apportionment, privilege claims related to billing records, Daubert challenges and assertions of bad faith litigation practices, among others.   

Mr. Neiman is a Fellow of the Chartered Institute of Arbitrators.

For more on Phillip Neiman, visit https://www.jamsadr.com/Neiman/

NALFA Welcomes Jim Warren

July 23, 2020

NALFA welcomes Jim Warren to our membership.  Jim Warren of Carroll Warren & Parker PLLC in Jackson, Miss. is a fully qualified attorney fee expert.  Jim has an active litigation practice focused on complex commercial litigation such as insurance coverage, construction defect, professional liability, product liability, and business disputes. 

Jim has also tried and arbitrated cases in Tennessee, Oklahoma, Missouri, California, and New York, and handled matters in many other states and countries.  He is a successful neutral, having acted as mediator, arbitrator, and court-appointed special master.  As a seasoned litigator he has supervised attorneys, managed high-stakes cases, reviewed billing entries, advised on billing practices, and coordinated billing systems with outside parties.

“Jim brings a sharp analytical mind to task-based legal fee analysis.  “He has an outstanding reputation among clients, jurists, and fellow litigators.  Jim offers a strategic approach to fee, billing, and rate engagements”, said Terry Jesse, Executive Director of NALFA.  “We’re proud to welcome his talent and skill set to our membership and rate him among the nation’s top attorney fee experts," Jesse added.

For more on Jim Warren, visit https://www.cwplaw.com/team/jim-warren/.

$23M in Attorney Fees in Yahoo Data Breach MDL

July 22, 2020

A recent Law 360 story by Dorothy Atkins, “Yahoo Data Breach MDL Attys Get $23M in Cut Fee Award” reports that a California federal judge approved a $117.5 million deal to resolve multidistrict litigation involving 194 million class members over Yahoo's multiple data breaches and awarded class counsel $23 million in fees, declining to award the full $30 million they requested.  In an 86-page opinion, U.S. District Judge Lucy Koh signed off on the settlement allotting class counsel $23 million in fees and $1.48 million in costs, while class representatives received between $2,500 and $7,500 in service awards.

In rejecting class counsel's bid for $30 million in fees, Judge Koh recognized that their requested fee amount met the 25% benchmark typically awarded in class action settlements.  But the judge said calculating fees based on a percentage of the total deal isn't appropriate in this "megafund" case involving more than a hundred million class members.  "Having overseen this case for four years, the court finds that justice would be best served by applying the lodestar method — i.e., tying the fee awards for class counsel to the actual hours they reasonably expended on this litigation and then selecting a multiplier," the order says.

During a hearing held via Zoom last month, Judge Koh heard multiple objections to the settlement and fee request.  At the time, the judge told class counsel she wanted more detailed billing information — including the "markup" on work by first-year law students — on the 31 law firms and 204 attorneys and paralegals who worked on the MDL and related litigation consolidated in state court, as well as total costs for hiring experts.  After reviewing the supplemental information, Judge Koh said in her order that class counsel's hourly billing rates — which ranged from $450 to $900 for partners, $160 to $850 for non-partner attorneys and $200 for summer associates — is reasonable.