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Category: Fees & Misconduct

Lieff Cabraser Can’t Freeze $1M Fee Reduction During Appeal

March 14, 2021

A recent Law 360 story by Brian Dowling, “Lieff Cabraser Can’t Freeze $1M State St. Fee Cut Amid Appeal,” reports that Lieff Cabraser Heimann & Bernstein LLP failed to persuade a Massachusetts federal judge to freeze $1.1 million of its fee slated for repayment in the wake of an overbilling scandal connected to a $300 million settlement with State Street Corp.  The firm, one of three ordered to repay seven-figure sums to the settlement fund, had sought to keep the money in escrow as it asks the First Circuit to review Senior U.S. District Judge Mark L. Wolf's reallocations of the fee award.

Denying Lieff Cabraser's motion in a 57-page order, Judge Wolf said the firm isn't likely to succeed on appeal and also faces no threat of irreparable harm if the money isn't frozen.  Instead of facing the tough odds of potentially having to recoup distributed settlement funds from the class, Lieff Cabraser would get any increase ordered by the First Circuit from its co-counsel, Labaton Sucharow LLP and Thornton Law Firm LLP.

Labaton Sucharow and Thornton received the bulk of the blame for improprieties and overbilling practices and repaid much higher sums to the settlement fund when Judge Wolf slashed the fee award from $75 million to $60 million in February 2020.  The two firms did not appeal the reallocation but supported Lieff Cabraser's request for a stay, Judge Wolf noted.

"The repeated, egregious misconduct of Labaton and Thornton alone caused the court to decide that it was most appropriate to award $60,000,000," Judge Wolf said. "If the court had allocated an additional $1,140,000 to Lieff, it would have reduced the awards to Labaton and Thornton by that amount."

Judge Wolf disputed Lieff Cabraser's arguments that the court violated noticing requirements in sanctioning it with the lower fee award.  There was no sanction, Judge Wolf said, just the court taking into account "proven misconduct of Labaton and Thornton in deciding to make a new fee award."  The court explained that its review of the attorney overbilling referred to Lieff Cabraser's conduct as "deficient" rather than as "misconduct" delineating that the firm's shortcomings were not critical to the new lower fee award.

The underlying suit, filed in 2011, alleged that Boston-based State Street swindled millions of dollars a year from its clients on their indirect foreign exchange trades over the course of a decade. State Street settled the claims in 2016 for $300 million.  Judge Wolf approved the initial $75 million fee in 2016 but vacated that order after allegations of double-billing surfaced in a 2016 Boston Globe report.  He appointed retired U.S. District Judge Gerald Rosen as a special master to investigate the fee.  The firms admitted to overstating their billing but contended the $75 million fee was still proper.

Judge Rosen in 2018 recommended the firms disgorge just over $10 million, but Judge Wolf's 160-page order in late February ruled that the cuts should be even deeper and took the firms to task in the process.  Also before Judge Wolf is a legal fight between Thornton and its liability insurer over whether the company, Continental Casualty, can avoid covering the firm's attorney fees stemming from the court-ordered overbilling probe.

Judge Orders Attorney Fee Dispute to Arbitration

March 9, 2021

A recent Law 360 story by Emma Whitford, “Atty Must Arbitrate Fee Dispute With Racehorse Trader,” reports that a California judge ordered an attorney to arbitrate her dispute with a U.K. racehorse auctioneer company, her former client, over fees allegedly due when she represented the company accusing a financier of failing to pay for a racehorse.  Attorney Diana Courteau of California claimed in her April complaint that Tattersalls Ltd., the racehorse company, failed to pay her $73,255.34 for the months of February and March 2020, after firing her that March.  The six-claim complaint also accused Tattersalls and Bracher Rawlins LLP, the company's English counsel, of fraud and intentional misrepresentation.

But Tattersalls and Bracher Rawlins pushed back with a motion to dismiss, pointing to an arbitration provision in their contract with Courteau and claiming that she failed to give them proper notice under the California Mandatory Fee Arbitration Act, which lays out rules for the handling of attorney-client fee disputes.  "Here, it is undisputed that [the] plaintiff did not provide the mandatory notice form to defendants," U.S. District Judge Dolly M. Gee ruled, adding that the case will be stayed while arbitration goes forward.

"Moreover," Judge Gee added, "the agreement between plaintiff and Tattersalls contains a broad arbitration provision governing the very dispute at issue."  Specifically, a "dispute over legal bills that alleges breach of contract and related claims."  Courteau had argued that Bracher Rawlins could not compel her to arbitrate because the firm is not a signatory to her agreement with Tattersalls.  But Judge Gee disagreed, saying that Bracher Rawlins will be part of the arbitration as an "agent" of Tattersalls.

It is "well settled that a nonsignatory may compel a signatory to arbitrate based on agency principles," Judge Gee wrote, adding that Bracher Rawlins "was only in a position to direct or authorize plaintiff to perform legal work for Tattersalls in its capacity as Tattersalls' agent."  The order is just the latest development in the litigious fallout of Tattersalls' working relationship with Courteau, who represented the company in various matters from 2011 until March of last year.

Last June, in the case Courteau worked for Tattersalls until they fired her, U.S. District Judge Karen S. Crawford ordered Courteau to pay $31,772.62 in sanctions to defendants Gerald Wiener and his entity Finance California Inc., court records show.  The sanctions covered attorney fees for a two-day deposition last January in which the court found that Courteau coached the witness, as well as the cost of preparing the sanctions motion, court records show.

Wiener and Finance California had also sought termination sanctions, a serious sanction that would have ended the case, for Courteau's alleged "abusive" and "hardball" tactics.  But Judge Crawford denied that motion, saying the "worst of this conduct has been addressed" and "monetary sanctions have been imposed which should be enough to deter future misconduct."  Courteau has yet to pay the sanctions, court records show.  Attorneys for Wiener filed a notice of lien in the instant suit on Jan. 15.

In a Feb. 4 declaration to the court, Courteau urged Judge Gee to proceed with a trial for her fee dispute or, in the alternative, send the case to "global mediation" along with the Wiener case, which is currently on appeal to the Ninth Circuit.  "Plaintiff is willing to stipulate (notwithstanding meritorious grounds for appeal) that ... the $31,772,62 (sanctions) can be paid from fees owed by defendants," Courteau wrote.

Article: When is ‘No Fee’ a Reasonable Fee?

March 6, 2021

A recent article by Karen M. Morinelli and Samantha E. Dunton-Gallagher, “When Is ‘No Fee’ a Reasonable Fee? 11th Circuit’s Guidance on Reasonableness in FLSA Attorneys’ Fees Cases,” reports on a recent FLSA fee ruling in the Eleventh Circuit Court of Appeals.  This article was posted with permission.  The article reads:

On February 1, 2021, in an unpublished opinion resolving a Fair Labor Standards Act (FLSA) attorney’s fees dispute, the Eleventh Circuit Court of Appeals, in Batista v. South Florida Womans Health Associates, Inc., struck another blow against unreasonable plaintiffs’ counsel seeking “reasonable” fees.  Mitzy Batista appealed the district court’s finding that it would be unreasonable to award her counsel, Elliot Kozolchyk, any attorney’s fees given his conduct during litigation filed under the FLSA.  Ultimately, the Eleventh Circuit remanded the case to the district court to make necessary findings of fact and to issue its ruling regarding whether the employer had mailed a replacement check.  However, in doing so, the Eleventh Circuit provided additional analysis as to when reasonable attorneys’ fees in an FLSA case may be no fee at all.

Background

Mitzy Batista was employed for slightly over two weeks in January 2018 by South Florida Woman’s Health Associates, Inc., when she was discharged for missing work.  Batista claimed that she never received her last paycheck and was owed $275.50 for the 38 hours she worked.  South Florida Woman’s Health Associates claimed that Batista’s last paycheck was mailed to her last known address and that because the check was not returned, and because Batista did not contact the company, South Florida Woman’s Health Associates assumed that all was well.  Batista, however, claimed that she called her former employer’s office the day after she was fired and asked for her final paycheck.  She alleged that at first she was told she would be paid by direct deposit, only to be told a few days later by the receptionist that the owner of the clinic, Edward D. Eckert, was not going to pay her at all.

Batista met with her counsel, Kozolchyk, three weeks after her employment was terminated.  But in the three months that followed, neither Batista nor Kozolchyk contacted her former employer to ask about the missing check.  In May 2018, Batista sued her former employer, raising claims under the FLSA including violations of the minimum-wage provision, liquidated damages, and attorneys’ fees and costs.  After receiving notice of the lawsuit, Eckert offered to send Batista a check for her unpaid wages but not her attorney’s fees.  Kozolchyk ignored Eckert’s initial offer.  When the counsel for South Florida Woman’s Health Associates and Eckert himself reached out again, they offered to clear up the matter and offered to pay the unpaid wages and court costs.

Kozolchyk initially ignored their communications and about a month later rejected the settlement offer.  Kozolchyk insisted on receiving attorney’s fees in an amount greater than what Eckert believed to be reasonable, stating, “my client cannot agree to shoulder the fees in this case … [for] those are recoverable against the defendants above and beyond the value of the claim.”  Kozolchyk then demanded his fees in the amount of $3,200, and Eckert counteroffered $1,100 in attorney’s fees.  Ultimately, the parties settled and agreed that Batista was to be paid $551 in unpaid wages, liquidated damages, and costs in the amount of $523, and that “the task of deciding the question of reasonable attorney’s fees” would be left to the district court.  The settlement was approved and Batista filed her motion for attorneys’ fees, seeking $10,675 in fees for the 30.5 hours Kozolchyk claimed to have expended litigating the case.  The district court referred the motion to a magistrate judge for a report and recommendation.

The magistrate judge, although “acknowledging the general requirement that prevailing plaintiffs in FLSA actions receive some award of attorney’s fees,” recommended that the court deny Batista’s motion and not award her attorney’s fees.  “Specifically, the magistrate judge found that (i) Defendants timely issued and mailed Plaintiff her final paycheck to the address she provided, (ii) Kozolchyk made no effort to contact Defendants to inform them that Plaintiff had not received her check before suing, and (iii) had he done so, he would have discovered that Defendants had sent Plaintiff’s paycheck to her address and were willing to issue another.”  Accordingly, the magistrate judge deemed Batista’s fee demands to be “excessive relative to the minimal work [i.e., a brief phone call] necessary to resolve the matter and make his client whole.”  The district court adopted the factual determinations and legal conclusions contained in the report and recommendation and rejected Batista’s objections, which included an affidavit in which she averred that she had telephoned someone in South Florida Woman’s Health Associates’ payroll department to request her last paycheck.  South Florida Woman’s Health Associates did not provide an affidavit to support its own allegations.

The Court’s Analysis

In determining whether the district court abused its discretion when it determined that a reasonable attorney’s fee in the case was no fee, the Eleventh Circuit reviewed guidance provided by analogous case law in the Southern District of Florida—including cases where plaintiffs were also represented by Kozolchyk.

Initially, the court discussed the “seminal district court case” of Goss v. Killian Oaks House of Learning, which was decided in 2003.  There, the plaintiff was a former employee who alleged she was owed two days of pay.  The former employer had issued a check and told her to pick it up, but instead of doing so, she hired a lawyer who sued the former employer for failure to pay wages.  The plaintiff’s lawyer asked for over $16,000 in attorneys’ fees where the matter settled for slightly over $300 for unpaid wages.  The Goss court stated that regardless of “the FLSA’s provision for a mandatory award of attorney’s fees for a prevailing plaintiff, ‘an entitlement to attorney’s fees cannot be a carte blanche license for Plaintiffs to outrageously and in bad faith run up attorney fees without any threat of sanction.’”  The Goss court “concluded that there are ‘special circumstances’ that can render the award of attorney’s fees unjust and that ‘so-called nuisance settlements represent such a circumstance.’”

The Eleventh Circuit also discussed Nelson v. Kobi Karp Architecture & Interior Design, Inc., a 2018 case in which “the [district] court denied in its entirety a fee request by counsel in [the] case, Mr. Kozolchyk.”  The plaintiff in Nelson had sued for two days of unpaid wages equaling $116, and after settlement, Kozolchyk had sought more than $9,000 in attorney’s fees.  In Nelson, the employer had immediately tried to resolve the matter after suit was filed by paying the unpaid wages at issue, plus $1,500 in attorney’s fees and costs, which Kozolchyk declined.  The employer, through counsel, then physically tendered the money in question and offered $2,000 in fees and costs, but Kozolchyk still declined.  The Nelson court ultimately determined that ‘Kozolchyk’s “sole intent [at that point] was to run up his bill.’”  Therefore, the Nelson court concluded, awarding any attorney’s fees would be “unreasonable, unjust, and inequitable.”

Similarly, in the 2019 case of Olguin v. Florida’s Ultimate Heavy Hauling, after Kozolchyk had filed suit, “the employer unconditionally tendered to Kozolchyk all the wages requested by the plaintiff, but Kozolchyk refused to accept the tendered paycheck” and lengthy litigation ensued on a separate claim, which he ultimately abandoned.  Kozolchyk ultimately sought attorney’s fees of over $36,000.  The Olguin court denied the request for attorney’s fees, finding that Kozolchyk’s “conduct was part of a strategy to churn the file and create unnecessary attorney’s fees.”

The Eleventh Circuit, analyzing the prior case law, clarified that the absence of any inquiry by counsel notifying an employer prior to filing an FLSA action was not in and of itself sufficient to deny attorney’s fees.  Specifically, the court noted that although it had denied fees in Sahyers v. Prugh, Holliday & Karatinos, P.L., a 2009 case in which the plaintiff’s counsel had filed a lawsuit without contacting the prospective defendants to resolve the matter extrajudicially, the holding was limited to the facts of that case—“an FLSA suit filed against fellow attorneys as defendants.”  Indeed, the court emphasized that an attorney is required under the Federal Rules of Civil Procedure “to make reasonable inquiry into the facts underlying a claim.”  That is, “litigation in which the defendant-employer has done what it should reasonably do to get payment to a former employee, but in which the employee or her attorney has made no pre-suit effort to inform the employer that the payment was never received creates a scenario fitting into the … ‘nuisance litigation’ category.”

Ultimately, the Eleventh Circuit remanded the case because the primary reason for the district court’s holding that attorney’s fees should not be awarded rested on “the finding that Defendants had actually mailed a final check to Plaintiff prior to her lawsuit.”  However, the record lacked evidence to support this finding because “Defendants had never supported their factual position with an affidavit, [so] their assertions were likewise insufficient to create an adequate evidentiary basis for findings that Plaintiff ultimately contested.”

Key Takeaways

The decision provides helpful guidance to employers.  In instances in which an employee is seeking unpaid wages where the amount of wages sought is partly or fully contested, the employer may want to consider tendering payment in full pre-suit where such sum is nominal.  Providing full tender of the payment may assist in preventing an overinflated award of attorneys’ fees and costs where the employee’s counsel’s primary intent is to “churn the file” and gain fees in bad faith.  When considering their options, employers may want to take heed that FLSA cases are fact-specific.

Karen Morinelli is the Office Managing Shareholder of Ogletree Deakins’ Tampa office.  As a former General Counsel and Vice President of Human Resources, she brings a strong business perspective to both client relations and in her approach to manage client issues.  She counsels employers in all aspects of labor and employment law including employer/employee relations, litigation, and alternative dispute resolution.

Samantha Dunton-Gallagher is Of Counsel in Ogletree Deakins’ Miami office and represents employers in cases that involve, among other things, alleged wrongful termination, harassment, discrimination, wage and hour violations and unfair business practices.  She regularly interacts with state and federal agencies, such as the U.S. Department of Labor and the Equal Employment Opportunity Commission (EEOC).

This article was drafted by the attorneys of Ogletree Deakins, a labor and employment law firm representing management, and is reprinted with permission.  This information should not be relied upon as legal advice.  

Article: Since When Do Attorneys Have to Pay the Opposing Counsel Fees?!

February 20, 2021

A recent article by Deena Duffy, “Since When Do Attorneys Have to Pay the Opposing Counsel Fees?! reports on how attorneys can be held responsible for opposing counsel fees in Ohio.  This article was posted with permission.  The article reads:

Attorneys can be Held Responsible for Opposing Legal Fees if Discovery Rules are Neglected

This may be a question that has never crossed your mind.  If so, then good for you. It means you’ve likely never been faced with sanctions.  However, just because you haven’t, doesn’t mean you shouldn’t be aware of the possibility.

What happens when your client is served discovery requests that require review of a large number of documents prior to production to the other side, yet, your client refuses to be involved in the review?  What if not only does your client refuse to engage in the review, but also refuses to engage in any negotiations aimed at making the review more manageable?  Quite clearly, these actions likely won’t bode well for your client.  Even more unfortunately for you, as this client’s attorney, you yourself could land in hot water with the court, even resulting in you being personally responsible for a portion of opposing counsel’s fees.

As we all know, some jurisdictions are more lenient when it comes to discovery rules while others – not so much.  To that extent, it is crucial to be familiar with not only the discovery rules for the jurisdiction you’re in.  Moreover, the growing importance of becoming aware of the potential ramifications of not complying with those discovery rules cannot be understated.

In a recent case out of Second District Court of Appeals of Ohio, an attorney learned the hard way what happens when you let the client run the show.  As attorneys, our duty is obviously to be zealous advocates for our clients and to provide them with advice and guidance related to their case.  However, we need to recognize that during the course of our representation, it becomes our responsibility to ensure that the client is doing what the court has ordered.

This particular discovery and sanctions issue arose out of a civil action where Plaintiff alleged that Defendant engaged in tortious interference with business relationships, defamation, invasion of privacy, intentional infliction of emotional distress, and civil conspiracy.  During the discovery phase, which began in December 2017, the Defense served Plaintiff with several requests for document production.  In Plaintiff’s interrogatory responses, Plaintiff identified 68 witnesses as having information related to his claims.  Defense counsel proposed that Plaintiff provide his multiple email accounts and their passwords to the Defense’s expert, who would then run searches for the 68 witness names.  The Court approved of the plan; however, the Plaintiff did not, arguing that this approach did not account for the protection of privileged information.

On appeal, the case was remanded and the parties came to an agreement regarding production wherein the first search the expert would conduct would be the names of privileged individuals.  The results of that search would go to Plaintiff counsel to review and produce a privilege log related to those documents.  The remainder of the non-privileged emails that hit on the 68 witness names would then be produced.  Defense counsel provided a list of potential search terms to Plaintiff counsel, who had no objections or modifications to the list.  Herein appears to be the end of Plaintiff’s cooperation in the discovery process.

The search for privileged names returned roughly 3,200 emails.  Plaintiff’s counsel identified roughly 2,700 of them as actually being privileged and produced a privilege log, though woefully insufficient.  The second search, for the 68 witness names, returned roughly 50,000 emails.  Following the second search, Defense counsel requested that Plaintiff modify their discovery responses.  This would assist in modifying the search term list in an attempt to cull out potentially non-responsive results to make the potentially responsive population easier to manage.  Defense counsel didn’t hear anything from Plaintiff counsel for two weeks, at which point the Plaintiff refused to modify the discovery responses.  Plaintiff did suggest that Defense counsel somehow modify the search term list to be able to discern between “material” and “relevant” discoverable information, yet provided no suggestion on how this might be accomplished.  Plaintiff counsel also informed Defense counsel that Plaintiff blatantly refused to review any emails prior to 2013, arguing that there is no way they could be relevant.  Defense counsel continued attempting to negotiate with Plaintiff to methodically deal with the large population of emails; however, Plaintiff counsel never responded to Defense counsel’s suggestions.

After roughly 15 months, the Defense filed a motion for sanctions, arguing that Plaintiff (1) refused to provide a sufficient privilege log, (2) refused to review or provide any emails from pre-2013, (3) refused to review or provide any emails related to the second search, and (4) failed to respond or negotiate regarding any suggestions made by the Defendant to move forward in the discovery phase.  At the sanctions hearing, Plaintiff counsel wasn’t in any position to help himself or his client.  Plaintiff admitted that he didn’t review a single email out of the 50,000 that resulted from the search, saying that he glanced at the list but found it overwhelming, repeatedly stating that the expert never actually ran the search terms.  In response to being asked about the pre-2013 emails, Plaintiff said, “I did not even [expletive] know the defendant during that time and it wasn’t relevant to this particular action.”  The Defense claimed they were relevant for two reasons – first to prove that Plaintiff routinely engaged in vexatious litigation, and second to prove that Plaintiff had been engaging with the witnesses as early as 2010 due to his involvement with the Defendant’s church business.

Eventually, Judge Hall granted the sanctions motion, finding Plaintiff in contempt for failing to comply with the December 2018 agreed discovery order.  A few months later, a hearing was held on the matter of attorneys’ fees, of which the court ordered Plaintiff and Plaintiff counsel, jointly and severally, to pay Defense counsel’s attorney fees, totaling $11,835.00.

In its analysis, the Court routinely returned to the fact that Plaintiff not only failed to review any of the documents, but that he blatantly refused to do so.  The Court noted that the discovery order to which the parties had agreed did not give Plaintiff the option to choose to review the emails but rather the duty to do so.  Plaintiff alleged more than once that the list of documents to review was overwhelming; however, Plaintiff refused to engage in any negotiations with the Defense regarding potential modifications to make the population more manageable.

In Ohio, the civil rules allow for an attorney to be sanctioned for failing to comply with discovery orders per Civ. R. 37(B)(3).  The Court, in granting sanctions against Plaintiff counsel, argued that Plaintiff counsel continued to repeat baseless allegations about Defense counsel’s motives and that it was “especially egregious” for Plaintiff counsel to continually blame the Defendant for Plaintiff’s negligent conduct regarding discovery.

This case, while unfortunate for Plaintiff and Plaintiff counsel, should serve as a reminder to attorneys of the need to be genuine in their efforts regarding discovery.  It should go without saying that, due to attorney ethics and candor requirements, attorneys are responsible for following orders issued by the court and that failure to do so could result in the misbehaving attorney being found personally responsible for a portion of opposing counsel’s fees.

Moral of the Story

Not only is it important to understand what is required with regard to jurisdictional discovery rules, but also to understand what could happen the rules aren’t followed.

Deena Duffy is staff attorney at Spencer Fane LLP in Minneapolis.

Law Firms Tussle Over Share of $8.3M in Attorney Fees

October 12, 2020

A recent Law 360 story by Emillie Ruscoe, “Fee Bid is ‘Unseemly Mudslinging.’ ICO Suit Co-Counsel Says,” reports that part of a co-lead counsel team accused their counterparts of "unseemly mudslinging" in a dispute over distribution of the $8.3 million counsel fee they earned in a settlement of allegations that Swiss blockchain company Tezos Stiftung's 2017 initial coin offering violated federal securities laws.

Lawyers from Block & Leviton LLP and Hagens Berman Sobol Shapiro LLP told U.S. Magistrate Judge Joseph C. Spero to deny a September motion for counsel fees filed by attorneys from Hung G. Ta Esq. PLLC, LTL Attorneys LLP, the Restis Law Firm PC and Lite DePalma Greenberg LLC, telling the magistrate judge that the fee request "is devoted to unseemly mudslinging, inaccurate accusations of deceit, and unfounded claims of violations of the rules of professional conduct."

The Hung G. Ta Esq. PLLC-helmed attorney group filed their counsel fee request in September, asking U.S. District Judge Richard Seeborg to order Block & Leviton to put funds back into the escrow account holding $8.3 million that the plaintiffs' counsel team was awarded for its work on the case.  In a memo accompanying the counsel fee motion, the HGT Law group told Judge Seeborg that "Block & Leviton has proceeded, without HGT Law's authority, to distribute attorneys' fees to itself and several other firms with which it is aligned," asking the judge not to permit "such brazen misconduct."

HGT Law said the Block group had "proceeded to unilaterally distribute fees" so that Block & Leviton and Hagens Berman received 25% of the total fee, and 50% of the fee went to Robbins Geller, which is not docketed in the matter but was also involved in the case, according to the co-lead counsel team.  "This proposal is irrational and unreasonable," the HGT group contended, suggesting that Block & Leviton was trying to "maintain good relations with Robbins Geller and ensure favorable treatment from Robbins Geller in other cases."

Two days after the counsel fee motion was filed, court records show, Judge Seeborg referred the case to Judge Spero for resolution of the attorney fees dispute.  "This development is unwelcome, and its disposition ought not involve the intervention of this court," Judge Seeborg said in the same order vacating the Oct. 29 hearing on the motion that HGT had requested.

The Block group apologized to the court "that counsel were unable to work things out among themselves" and promised to work with the magistrate judge to resolve the issue in good faith.  "The court should not have to deal with this dispute.  It is always unseemly for lawyers to be squabbling over a multimillion-dollar award of attorneys' fees," the Block group said.

The Block group contended that HGT Law knew since December 2019 that it could expect to receive a quarter of the counsel fee.  "The [HGT Law group] never proposed a different fee allocation until after fees were awarded and sat on its hands until B&L sought to distribute the money consistent with [co-lead plaintiff] Trigon's allocation," the Block group claimed.

The Block group also said that "The Ta Group's wild accusation that 'Block & Leviton (and the other firms in the Block group) have attempted to deceive HGT Law, and have violated numerous ethical duties and guidelines of this district' is absolutely false."  The Block group also said that it "reiterates its willingness — if the Ta Group would like to withdraw its motion without prejudice — to resolve this dispute either through further informal discussions or through more formal [alternative dispute resolution] mechanisms."

Records show the parties to the case reached a $25 million cash settlement agreement in March, ending claims that the Tezos defendants held an unregistered securities offering in July 2017.  The $8.3 million counsel fee comprised a third of the settlement fund, and the attorneys who worked on the case on behalf of the proposed investor class would also get $300,000 to cover their litigation costs, according to the settlement terms.