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Category: Fee Request

Fee Request Made in Newark’s Amazon Proposal

April 27, 2018

A recent New Jersey Law Journal story by Charles Toutant, “Plaintiff Who Made Public Newark’s Amazon ‘HQ2’ Proposal Seeks Fees Award,” reports that the City of Newark is weighing a request for legal fees from a plaintiff who successfully challenged its nondisclosure policy concerning its proposal to serve as a second headquarters city for Amazon.

Newark turned over its 201-page HQ2 application, with redactions on six of those pages, to requester Steven Wronko. The disclosure follows a suit filed by Wronko in February under the Open Public Records Act over the city’s assertion that its application to Amazon was off-limits to the public.

CJ Griffin of Pashman Stein Walder Hayden in Hackensack, New Jersey, who represents Wronko, said she was not sure of the amount of legal fees at issue in the case. OPRA grants fees and costs to prevailing parties in open records suits. The settlement follows a April 20 hearing on Newark’s motion to dismiss the case.  On that day, Superior Court Judge Jeffrey Beacham adjourned the case so the parties could hold settlement talks, Griffin said.

Newark’s proposal to Amazon includes information about possible development sites, technology infrastructure and potential partnerships with local universities.

It also includes information about crime, housing, entertainment and sustainability and letters of support from community leaders.

Wronko filed suit against the city in February after his request for a copy of the city’s proposal was declined by the city.

Newark had maintained that rules of the HQ2 competition required it to keep its submission confidential. It asserted in the motion for dismissal that it was entitled to the competitive advantage exception under OPRA.

Wronko maintained, however, in opposition to the motion, that Amazon’s nondisclosure agreement only applies to information that Amazon disclosed to Newark, adding that the company stated that agencies should comply with public records laws. In addition, Wronko said Newark failed to provide evidence that disclosure would put it at a disadvantage. Courts have held that an agency cannot overcome OPRA’s presumption of access by “simply making a conclusory statement that a record is exempt or harm will occur if a record is released.”

Newark is one of 20 finalists in the HQ2 competition, which is expected to bring 50,000 high-paying jobs and $5 billion in construction to the location the company selects to partner with its Seattle headquarters. Although several other New Jersey cities and towns applied, Newark’s application had the support of former Gov. Chris Christie and the Legislature, which offered $7 billion in financial incentives.

The redacted portions of the Newark proposal pertain to the financial incentives, Griffin said.

Griffin said some other finalist cities put their application materials online from the outset of the process. “That builds pride and buy-in from residents. The people of Newark were completely excluded, but we are happy that they can now be part of the process,” he said in a statement.

Griffin said the application disclosed the existence of a promotional website made on behalf of Newark’s application, www.yesnewark.com.

“Evidently the city hired a PR firm to create the site and market Newark, but the fact that no one really knows about that site makes me wonder whether we got the most bang for our buck. Certainly Boston and D.C. utilized their websites much more effectively,” she said in an e-mail.

Assistant Corporation Counsel Samora Noguera, who represents Newark in the case, said the city would not comment on the case.

Special Fee Master Finds Fee Request Excessive in Anthem Data Breach Case

April 26, 2018

A recent The Recorder story by Scott Flaherty, “Special Master Finds Legal Fee Bid Excessive in Anthem Data Breach Case,” reports that a court-appointed special master has recommended cutting more than $9 million off a legal fee request by plaintiffs lawyers involved in a $115 million class-action settlement of data breach litigation against health insurer Anthem Inc.

Pointing to duplicated efforts and excessive hourly billing rates for contract lawyers, special master James Kleinberg, a retired Santa Clara County superior court judge who is now a mediator and arbitrator at JAMS, recommended on Tuesday a legal fee award of $28.59 million to lawyers for the settlement class, plus just more than $2 million in expenses, according to his report.

The special master was appointed in February by U.S. District Judge Lucy Koh in San Jose, California. Koh is overseeing multidistrict litigation spurred by a massive, 2015 cyberbreach at Anthem that compromised the personal information of more than 78 million people.

Tuesday’s recommendation marks a significant reduction from the $38 million that plaintiffs lawyers sought after settling the Anthem litigation in June. The plaintiffs lawyers’ initial request constituted 33 percent of the $115 million settlement, but Kleinberg recommended awarding them just less than 25 percent of the total settlement.

Explaining the downward revision, Kleinberg pointed to several issues that he saw with the fee request. One specific critique involved the billing rates for 33 contract lawyers on the case; plaintiffs firms paid those lawyers between $25 and $65 per hour, according to Kleinberg. By contrast, the initial fee request asked for the equivalent of, on average, nearly $360 per hour for those lawyers.

“It is simply inappropriate for these rates to be charged,” Kleinberg wrote.

The special master also found that, because some 53 law firms were involved as plaintiffs counsel, there were instances of duplicated efforts that, in turn, led to overbilling.

“The special master is not accusing plaintiffs’ counsel of deliberate overbilling. However, every time a new law firm was added to the group, those lawyers had to spend time learning the history, issues and facts being litigated. Thus, the inevitable result of 53 firm billing participants presents at least a strong probability of duplication and unreasonable hours,” Kleinberg wrote.

Kleinberg’s report and recommendation come after Koh said during a hearing in February that she was “deeply disappointed” in the plaintiffs lawyers’ initial fee request, in part because it included bills submitted from some 53 firms. Earlier in the case, Koh had explicitly urged the plaintiffs firms to keep their leadership team lean.

The judge ultimately appointed as lead counsel Eve Cervantez of Altschuler Berzon, and Andrew Friedman of Cohen Milstein Sellers & Toll, and allowed for a plaintiffs steering committee led by Michael Sobol of Lieff Cabraser Heimann & Bernstein and Eric Gibbs of Girard Gibbs. In February, the judge informed the plaintiffs firms that she intended to appoint Kleinberg as a special master to scrutinize their billing records.

Following the submission of the special master report, Koh on Tuesday issued an order that gives parties in the litigation until May 15 to object to or file a motion to adopt or modify the recommendations. The judge also set a hearing on the special master’s report for May 31.

Judge Trims Rates, Hours Billed in Hague Convention Fee Request

April 18, 2018

A recent Big Law Business story by Julianne Tobin Wojay, “Judge Trims Rates, Hours in Hague Convention Fee Request,” reports that an “unquestionably” experienced intellectual property attorney’s lack of experience in child abduction matters requires reducing the fees he billed, a New York federal trial court said.

Moreover his firm agreed to work for free, and thus “did not expect to be paid for its services or reimbursed for its expenses,” U.S. District Court Judge Jed S. Rakoff, of the U.S. District Court for the Southern District of New York, said.

Parents who obtain return of a child under the Hague Convention on the Civil Aspects of International Child Abduction are entitled to recoup their legal fees from the kidnapping parent.

This “prevailing party” fee award is calculated by multiplying the number of hours reasonably expended by the attorney by a reasonable rate, Rakoff explained.

To determine if the requested rate is reasonable, courts consider whether it’s “in line with those prevailing in the community for similar services by lawyers of reasonably comparable skill, experience, and reputation,” he said.

While the fact that services were provided free, or pro bono, doesn’t make a fee award “clearly inappropriate,” it can warrant a reduction in the amount awarded, Rakoff said.

Frederick L. Whitmer, a partner at Kilpatrick Townsend & Stockton LLP, billed his $875 standard hourly rate for his successful efforts in returning a woman’s child to the Dominican Republic after the girl was unlawfully brought to the U.S. by her father, the case summary showed.

However, despite 40-plus years of litigation experience, he has appeared in a Hague case “only once before” and “apparently has no other experience with family law,” Rakoff found.

“His representation in this case, though able, often reflected this inexperience,” Rakoff said, deciding that “only a rate of $400 per hour is warranted.”

Likewise, the standard rate charged by his colleague, a Harvard Law graduate who is “of counsel” at Kilpatrick Townsend & Stockton, must be reduced, Rakoff said.

Trademark attorney Lisa Willis “has no prior experience with Hague Convention matters or domestic or international family law,” he said, dropping her hourly rate from $295 to $250.

Additionally, the 510 total hours they billed “are excessive-perhaps due to the relative inexperience in this area of law,” Rakoff said, trimming the hours by 30 percent.

The mother was represented by Kilpatrick Townsend & Stockton LLP, and the father by Law Offices of Nolan Klein, P.A.

The case is Duran-Peralta v. Luna, 2018 BL 123358, S.D.N.Y., No. 16 Civ. 7939 (JSR), 4/1/18.

NJ Justices Consider Fee Request Following High-Low Settlement

April 9, 2018

A recent New Jersey Law Journal story by Michael Booth, “Justices Consider Fee Petition That Followed High-Low Settlement,” reports that the New Jersey Supreme Court is considering whether a medical malpractice plaintiff who took the rare step of seeking counsel fees under the offer-of-judgment rule, even after entering a high-low agreement that was silent on the issue, may recover such fees.

Lawyers on Monday argued over whether the plaintiff could be awarded fees over and above the $1 million “high,” a question that the Appellate Division answered in the negative.

“It’s not the plaintiffs’ burden to prove” that there was a provision in the agreement for counsel fees, said Bruce Nagel, the attorney for the plaintiff on appeal. There was no waiver of counsel fees in the settlement, said Nagel, of Nagel Rice in Roseland.

The defendant’s attorney, James Sharp, asked the court to affirm the lower court’s ruling.

“This case is settled,” said Sharp, of Schenck, Price, Smith & King in Florham Park.

In its February 2017 ruling, the Appellate Division said: “Without evidence that the parties agreed to allow plaintiff to seek amounts in excess of the high, [the plaintiff] was not entitled to any other payments.”

“Parties are always free to preserve any claim they might have pursuant to a court rule or otherwise when settling a case … but they must clearly state that intention at the time of the settlement,” Judge Garry Rothstadt wrote, joined by Judges Ellen Koblitz and Susan Reisner.

In the suit, plaintiff Ben Serico of West Caldwell claimed he was administered a colonoscopy by physician Robert Rothberg in December 2007, but two years later he was diagnosed with colon cancer that had spread to his liver. Serico died two years after his diagnosis, in December 2011, at age 62, after which his wife, Lucia Serico, continued to pursue claims that Rothberg negligently failed to treat the cancer.

The appeals court said Lucia Serico made an offer of judgment of $750,000 before trial, to which Rothberg never responded.

According to the court, settlement negotiations began in earnest during the trial, and the parties entered a high-low agreement providing for a minimum recovery of $300,000 and a maximum of $1 million. During the negotiations, neither side raised a possible fee award, or a reservation or waiver of rights, or the offer of judgement, the court said.

A jury found for the plaintiff after a two-week trial before Essex County Superior Court Judge James Rothschild Jr., and awarded $6 million, thus triggering the $1 million “high.” (The jury attributed 20 percent of damages to the decedent’s pre-existing cancer, which, absent the high-low, would have reduced the award to $4.8 million.)

Because the $1 million judgment was more than 120 percent of the previous $750,000 offer, Serico, citing Rule 4:58, moved for an award of fees and costs. Each side acknowledged that the issue hadn’t been raised at the negotiations during trial, the appeals court said.

Rothschild denied the motion. He found there was no evidence of intent to determine that Serico’s rights to a fee sanction under the rule had been preserved. He also referred to his 42 years’ experience as a civil lawyer and judge, as well as the experience of colleagues he consulted, and said high-low settlements were rarely if ever followed by fee applications under Rule 4:58, according to the court.

“By entering into the high-low agreement, plaintiff could not recover any amount beyond the ‘high’ to which she agreed because the agreement limits the total amount of defendant’s obligation to that amount,” Rothstadt wrote, adding that such agreements are “subject to traditional rules of contract interpretation.”

The panel did warn against Rothschild’s approach in the case, holding that “reliance on [his] personal experience was misplaced.”

$112.5M Fee Award in $1B NFL Concussion Settlement

April 6, 2018

A recent Legal Intelligencer story by Max Mitchell, “Judge Awards $112.5M in Total Attorney Fee in NFL Concussion Case,” reports that attorneys who helped hammer out the $1 billion settlement between the National Football League and former professional football players suffering cognitive injuries have been awarded $112.5 million for their work.  But, the judge has reserved for a later time her determination of the exact amount each firm will receive for its respective efforts.

U.S. District Judge Anita Brody for the Eastern District of Pennsylvania awarded class counsel $106.8 million in attorney fees and $5.7 million in expenses in the NFL concussion case.  The amount conforms to class counsel’s fee request, and is also the number the NFL had agreed to pay without objection as part of the settlement.

In making the ruling, Brody lauded class counsel efforts, noted that class attorneys billed more than 50,000 hours for their work on the settlement, and said the fee award is only 11 percent of the total settlement.  “The performance of class counsel regarding the complex settlement has been extraordinary,” Brody said, noting that more than 20,000 class members are registered to participate in the settlement and more than 360 claims valuing over $400 million have been approved.  “The fees requested here are well-earned.”

Individual class counsel attorneys have requested as much as $70 million for their firm, but Brody said that issue, along with determining how much the court should withhold from players’ individual awards to cover costs and fees of implementing the settlement, “will be determined at a later date.”

In footnotes, Brody said she plans to make a determination regarding fee allocation to the individual firms after reviewing the numerous responses and replies that have been filed.  She added it will likely take a year to determine how much money should be held back from players’ individual awards.  “The court hopes to address this issue once more data regarding the scope of implementation work is available—ideally in one year,” Brody said in a footnote.

Class counsel have asked the court to hold back 5 percent of the award to cover implementation costs.  Brody also determined that fees for individual retained attorneys should be capped at 22 percent.  The ruling adopts the recommendations from William Rubnestein, a Harvard professor who had been appointed by the court to consider the issue.

Individually retained attorney are lawyers who represent the injured players, but are not part of class counsel.  Brody said their fees should be capped because “it is undeniable that all [individually-represented plaintiffs’ attorneys] have benefitted from class counsel’s work.” Brody added that she will grant deviations above the 22 percent cap only “in exceptional of unique circumstances.”

In October, Seeger Weiss attorney Chris Seeger, who is co-lead class counsel in the case, requested that the court allocate more than $70 million to his firm,  The money, according to the fee request, would compensate Seeger Weiss for a total of 21,044 hours his firm spent on the litigation since he was appointed to represent the class in 2012.

Attorneys from more than 15 firms including Anapol Weiss, which is home to Seeger’s co-lead class counsel, Sol Weiss, subsequently challenged Seeger’s proposal.  “We appreciate the court’s consideration of this matter.  The settlement is on track to lost the NFL hundreds of million, if not billions of dollars more than anticipated,” Seeger said in an email statement.  “We will make sure that former NFL players and their families receive every benefit they are entitled to under this agreement.”

Fee Request Cut in Chipotle FLSA Case

January 30, 2018

A recent Law 360 story by Bonnie Eslinger, “’Excessive’ Chipotle Class Fee Cut From $3.2M to $600K,” reports that a Minnesota federal judge slashed an attorneys' fee request of $3.2 million...

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