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Category: Lawyering

Nurses Seek $7M in Fees/Costs in Wage & Hour Class Action Settlement

February 28, 2019

A recent Law 360 story by Adam Lidgett, “Nurses Seek $6.9M in Fees, Costs From $20M Wage Deal,” reports that a class of nearly 8,000 traveling nurses is asking a California federal court for about $6.85 million in fees and expenses for its attorneys' work that led to a $20 million settlement in an overtime suit against the Kaiser Foundation and a health care staffing contractor.  Class counsel urged the court to award $6,666,666 in attorney fees and $185,850.01 in litigation costs, after the class said in November it had settled the suit against Kaiser and AMN Healthcare Inc., the nurses’ employer that placed them at Kaiser Foundation hospitals in California.

The class said the fees they are seeking are reasonable for the work their attorneys performed, which included nearly 5,000 hours spent litigating the suit.  The class said that if it weren't for their attorneys’ ability and effort in fighting the defendant’s arguments and finding important evidence, they may have lost class certification and been left with no recovery.  The nurses, who have alleged they were shorted on overtime and denied proper meal breaks and rest periods, also asked that the three class representatives get $15,000 each as a service award.

“Even after proposed fees, costs and service awards, the average net recovery is approximately $1,570 per class member,” the plaintiffs said.  “This result is excellent, particularly in light of the class members’ relatively short tenures — just 26 weeks per class member, on average — in qualifying employment.  The average individual recovery also compares very favorably with analogous California wage and hour class action settlements.”  The motions came after the court in December granted the bid for preliminary approval of the settlement.

The nurses’ suit, which was removed to federal court in early 2016, alleged in part that AMN suppresses overtime by telling traveling nurses that overtime isn’t permitted and further discourages overtime by subjecting the traveling nurses to a cumbersome overtime approval process.  Moreover, the plaintiffs — who said in their suit they were required to work three 12-hour shifts per week — alleged they aren’t afforded proper meal and rest breaks through a variety of policies.  In addition to AMN Healthcare, the Kaiser entities named as defendants in the suit were Kaiser Foundation Hospitals, Southern California Permanente Medical Group Inc. and The Permanente Medical Group Inc.

The case is Shaw et al. v. AMN Healthcare Inc. et al., case number 3:16-cv-02816, in the U.S. District Court for the Northern District of California.

NJ Court Calls Fee Request ‘Inexplicable’ in Employment Case

January 24, 2019

A recent New Jersey Law Journal story by David Gialanella, “Court Affirms $57K Fee Award Following ‘Inexplicable’ $360K Request,” reports that an award of $57,000 in legal fees, in an employment case where the plaintiff recovered about $8,000 at trial and her lawyers sought some $360,000 in fees, was affirmed by a New Jersey appeals court.  “It is inexplicable to us how the amounts requested were accumulated given the factual circumstances behind the claim,” the Appellate Division said in Lema v. BTS Holdings, a per curiam decision issued Jan. 18.

The case was lodged by plaintiff Melissa Lema, who had worked as an overnight dispatcher for defendant BTS Holdings, a livery car service.  According to the decision, Lema claimed that one of the drivers, an independent contractor, treated her inappropriately—via social media photos and messages, and by touching her shoulder and whispering in her ear—and that she reported the issue to a supervisor.  Lema was fired in late September 2014, after about three months on the job, and claimed in her suit that she was told that her services weren’t needed anymore and that she was terminated because she watched pornography while on the job.

Within days of her firing, she filed an action alleging retaliatory discharge.  The suit also named BTS Holdings’ owner, Craig Lax, seeking punitive damages based on Lema’s claim that it was Lax who made the decision to fire her.  Lax contended that he was unaware of the situation.  Lema was represented by McOmber & McOmber in Red Bank.

The judge below was identified in electronic court records as Essex County Superior Court Judge Francine Schott, who oversaw a four-day trial in the case.  The jury awarded $5,000 on Lema’s retaliation claim and $2,983 for lost wages, according to the decision.  Schott dismissed the claim against Lax, finding that a lone alleged statement from Lema’s supervisor that Lax was behind the firing was not enough to keep him in the case.

Based on the Law Against Discrimination’s fee-shifting provision, the McOmber firm sought $360,588 in fees and $82,83 in costs.  Schott deemed the request excessive in what she called a “relatively straightforward” case, reduced the lodestar from $240,392 to $135,843, and also discounted some of the costs.  She also included a downward adjustment of 60 percent, though she did add a 5 percent contingency enhancement.  In all, the firm was awarded $57,054 in fees and $5,367 in costs.

On appeal, the McOmber firm contended that the fees sought were reasonable, and that Schott unfairly reduced the award.  Appellate Division Judges Carmen Alvarez, William Nugent and Susan Reisner affirmed.  “We see no reason why there should have been so many attorneys present in the courtroom during the course of trial,” the court said in the unpublished decision.  “That seems to be entirely unnecessary duplication of effort in a fairly straightforward case.”  “Lema’s counsel called two witnesses,” the panel said.  “Defendants had offered Lema substantially more than she recovered by way of settlement.  The court took this appropriate consideration into account in making the allowance.”

Also at issue on appeal: The McOmber firm twice moved for Schott to recuse herself based on what they claimed were bias and disparaging comments toward the plaintiff, the first of those motions coming after a pretrial settlement conference.  But Schott denied the motions. The appeals court did acknowledge an “arguably less than ideal” demeanor to counsel on both sides, but it affirmed the denials, saying that Schott “exhaustively explained her off-the-record comments, made in the hopes of reaching a settlement, as triggered by the weaknesses in Lema’s case, and she also indicated to defense counsel the weaknesses in their case.”

The court also affirmed Schott’s dismissal of the punitive damages claim against Lax.  The panel said Lema failed to establish, under the standard set out in the state Supreme Court’s 1995 opinion in Rendine v. Pantzer, “actual participation in, or willful indifference to,” the conduct at issue, or proof that the conduct was “especially egregious.”

Class Counsel Seek $13M in Attorney Fees in Dairy Settlement

January 2, 2019

A recent Law 360 story by Christopher Cole, “Class Attys Look to Milk $13M From Dairy Settlement,” reports that lawyers who secured a $40 million deal ending a suit by a proposed class of farmers alleging DairyAmerica Inc. and an affiliate lowballed milk prices paid to the class members are asking a California federal judge for a $13.3 million slice of the settlement and $824,000 in costs.  The attorneys said their decade-long work on the litigation — stemming from allegations that the milk giant and California Dairies Inc. lowballed nonfat dry milk rates to run up their profits — warranted a share totaling about a third of the settlement.

The $40 million deal was reached after a lengthy legal fight that included reviving the litigation in the Ninth Circuit after all the claims had been dismissed at the trial court level, the lawyers said in court papers filed Dec. 28.  “To achieve this exceptional result, class counsel have worked on an entirely contingent basis for approximately 10 years without compensation of any kind,” they said.  “The settlement was obtained as a direct result of class counsel’s relentless and creative advocacy, substantial investment, and continual risk-taking throughout the last decade.”  Separately, attorneys for the milk farmers want litigation expenses amounting to almost $824,000 and service awards to each named plaintiff of $90,000 and to each former plaintiff of $10,000.

The litigation dates to 2009, when a series of class actions were consolidated in California federal court.  The farmers accused the dairy buyers of providing lowball rates for nonfat dry milk in a survey by the National Agricultural Statistics Service, leading to federal milk marketing orders that allegedly disadvantaged farmers and beefed up the buyers’ profits.  The case almost died the following year when U.S. District Judge Anthony W. Ishii dismissed the claims, citing the filed rate doctrine, which holds generally that state law claims can’t be brought against federally set rates.  However, the Ninth Circuit disagreed, saying the doctrine wasn’t applicable to the legal issues in the suit, and revived the case in August 2012.

The farmers and dairy companies reached a settlement with the proposed class and asked the judge for approval in August. Judge Ishii gave the deal a green light on Sept. 14.  Attorneys for the milk farmers said that even though the Ninth Circuit has observed that 25 percent may serve as a fee award benchmark in such cases, that can be adjusted based on circumstances, and the settlement amount is “unusually high” relative to the alleged damages to the farmers.  They said the requested fees are “especially warranted considering the quality and depth” of their work, including defeating multiple motions to dismiss and amending the complaint twice to materially expand the claims.

“Yet, in addition to aggressively pursuing these traditional litigation avenues, class counsel also took multiple creative, unusual and ultimately successful steps at critical junctures of this litigation that were crucial to securing the $40 million settlement,” they said.

The case is Gerald Carlin et al. v. DairyAmerica Inc. et al., case number 1:09-cv-00430, in the U.S. District Court for the Eastern District of California

$96M Fee Award in $480M Well Fargo Investor Settlement

December 19, 2018

A recent Law 360 story by Lauren Berg, “$480M Wells Fargo Investor Deal OK’d, Attys Get $96M,” reports that a California federal judge granted final approval to a $480 million settlement resolving investor claims that Wells Fargo & Co. artificially inflated its stock value by opening millions of unauthorized customer accounts and awarded the investors' attorneys nearly $96 million for their efforts.  U.S. District Judge Jon Tigar said that the settlement “achieves a good result for the class,” finding that the maximum potential damages it could have won at trial ranged from $353 million to more than $3 billion.

“This recovery is higher than recoveries achieved in other securities fraud class actions of similar size (over $1 billion in estimated damages), which settled for median recoveries of 2.5 percent between 2008 and 2016, and 3 percent in 2017,” Judge Tigar wrote.  The settlement represents an average recovery of about $0.35 per share, once attorneys' fees and other costs are deducted from the fund, according to the order.

The lawsuit, led by Union Asset Management Holding AG, alleged Wells Fargo executives adopted an aggressive cross-selling business model that emphasized pushing multiple products on existing customers rather than attracting new customers.  To meet lofty sales targets, the bank’s employees opened millions of accounts for customers without their consent.

In September 2016, the Los Angeles Times raised questions about the practice, and the bank was soon hit with $185 million in civil penalties by regulators on Sept. 8, 2016.  Its stock price fell 9 percent over the next week, closing at $45.43 per share on Sept. 16, 2016.  The securities suit was filed 10 days later.  The settlement between the bank and anyone who bought its common stock between Feb. 26, 2014, and Sept. 20, 2016, was reached in May.  Wells Fargo has denied the suit’s claims, but said it reached a settlement "to avoid the cost and disruption of further litigation."

After approving the settlement amount Tuesday, Judge Tigar also approved $95.9 million in attorneys’ fees — 20 percent of the settlement amount — finding that that requested amount is reasonable and below the “benchmark” 25 percent.  “Plaintiff’s counsel obtained an excellent result for the class when compared to similar cases, despite comparable risks,” Judge Tigar wrote.

The case is Gary Hefler et al. v. Wells Fargo & Company et al., case number 3:16-cv-05479, in the U.S. District Court for the Northern District of California.

Attorneys Seek $8.6M in Fees in $29M Och-Ziff Securities Settlement

December 18, 2018

A recent Law 360 story by Rachel Graf, “Attys in $29M Och-Ziff Securities Settlement Seek $8.6M Fees,” reports that attorneys who reached a preliminary $28.75 million settlement resolving investors’ allegations that hedge fund Och-Ziff Capital Management Group LLC downplayed investigations into an African bribery scheme asked a New York federal court for $8.63 million in fees.  The investors’ attorneys said the amount, representing 30 percent of the total settlement, is reasonable since they worked for four years to achieve a “significant” settlement that was worth as much as roughly 28 percent of the estimated class-wide damages.  The attorneys are asking to be reimbursed for $401,240 in expenses as well.  “Considering the extensive investigations, motion practice, and discovery completed at the time of the settlement, the time and labor expended by class counsel here amply supports the requested fee,” the filing said.

In October, Och-Ziff and its former CEO Daniel S. Och and former CFO Joel M. Frank agreed to pay almost $29 million to resolve allegations they concealed an African bribery scheme and subsequent investigations by U.S. regulators that ultimately cost the company about $412 million and caused its stock price to fall, allegedly harming investors.  The investors’ attorneys said their requested award is justified by the risks and complexity of the case, the time and effort they put into it, the quality of their legal work and the expenses they incurred.

Each of the two class representatives is requesting $5,000.  “Class representatives and class counsel undertook the risky task of pursuing this litigation, with no guarantee of the positive outcome they achieved,” the filing said.  The investors' suit claimed Och-Ziff touted its "reputation for integrity," "transparency" and "strong financial, operational and compliance-related controls" even though the company was allegedly engaged in a years-long bribery scheme.  The company and executives bribed foreign officials in exchange for "hundreds of millions" of dollars' worth of business in Africa, violating the Foreign Corrupt Practices Act, an amended complaint said.

The U.S. Securities and Exchange Commission and the U.S. Department of Justice began an investigation in 2011, but Och-Ziff hid the probes from investors until The Wall Street Journal published an article in 2014 about deals in Libya, the investors said.  At that point, the company simply said the investigations involved the FCPA and "related laws," according to the amended complaint.  Two years later, the WSJ published another article that stated the DOJ was pursuing a criminal guilty plea and the SEC wanted to fine Och-Ziff as much as $400 million, sending shares of the company down more than 13 percent, the investors said.

Och-Ziff ultimately admitted to violating the FCPA in 2016 and agreed to pay about $213 million in a deferred prosecution agreement with the DOJ and $199 million in disgorgement to the SEC.  The case is Arthur Menaldi et al. v. Och-Ziff Capital Management Group LLC et al., case number 1:14-cv-03251, in the U.S. District Court for the Southern District of New York

Law 360 Covers NALFA CLE Program

October 25, 2018

A recent Law 360 story by Bonnie Eslinger, “Excessive Attys’ Fee Bids Can Backfire, Judges Say,” reported on a NALFA CLE program hosted today, “View From the Bench: Awarding Attorney Fees in...

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