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Judge Slashes Additional Attorney Fees for Milberg

August 26, 2010 | Posted in : Billing Practices, Contingency Fees / POF, Expenses / Costs, Fee Award, Fee Award Factors, Fee Jurisprudence, Fee Reduction, Fee Request, Hourly Rates

A recent law.com story, “Judge Approves Less Than Half of Milberg’s ‘Unusual’ Added Fees Request” reports that U.S. District Court Judge Richard M. Berman in New York has slashed what he called an “unusual” request for additional attorney fees by Milberg, LLP for a $2.4 billion settlement of a securities class action against Nortel Network Corp in 2006.  Judge Berman, in In re Nortel Network Corp. Securities Litigation rejected a fee request by Milberg for 8.5 percent of the settlement, or about $101 million and set attorney fees at 3 percent in 2007.  Berman used the 2nd Circuit Goldberger factors to determine reasonable attorney fees.  Milberg appealed the award, but the U.S. Court of Appeals for the Second Circuit upheld Berman’s fee award (PDF).

Milberg asked for an additional $2.77 million in attorney fees and expenses for work the firm did after filing its initial fee request in 2007.  Berman approved only 41 percent of the request.  Berman chastised Milberg for improper staffing and inadequate documentation.  In particular, the judge noted that 97.2 percent of the time invoiced was billed to six partners for matters including downloading documents from the internet, updating spreadsheets, and sending copies of documents to other lawyers on the case.  Milberg’s partners alone billed $425 to $725 an hour.  “It is clear that a significant portion of the work done by senior attorneys could have been performed by more junior attorneys or paralegals at lower billing rates,” Berman said.