A recent Law 360 story by John Petrick, “Lead Attys in Santander Investor Case Secure $3.1M in Fees,” reports that a Texas federal judge awarded $3.1 million in attorney fees to lead counsel Glancy Prongay & Murray LLP, The Rosen Law Firm PA and other counsel that helped lock down a $9.5 million settlement in a proposed shareholders class action against the vehicle financing unit of Santander Bank.  U.S. District Court Judge Ed Kinkeade also approved $75,000 to cover expenses the attorneys spent resolving claims that Santander Consumer USA Holdings Inc. disregarded accounting regulations and artificially inflated its stock.

The attorney fees — which the judge said lead counsel can distribute among the attorneys as it sees appropriate —  represent one-third of the overall settlement, which is fair and in keeping with settlements in similar cases, according to the order.  “Lead counsel has conducted the litigation and achieved the settlement with skill, perseverance, and diligent advocacy,” the judge said, noting some 2,845 hours were devoted to the case. 

“The action raised a number of complex issues.  Had lead counsel not achieved the settlement, there would remain a significant risk that lead plaintiff and the other members of the settlement class may have recovered less or nothing from defendants.”  Lead plaintiff Cynthia Parmelee was awarded reimbursement costs of $12,000 from the settlement for her efforts in representing the proposed class, while the court also awarded co-lead plaintiff Kelly Baxley with $2,500 for the same.

The suit was filed on behalf of anyone who bought Santander Consumer securities between Feb. 3, 2015, and March 15, 2016, with investors seeking damages to cover SantanderBank’s alleged violations of federal securities laws.  The shareholders accused the bank of deliberately misidentifying a group of loans that should have been termed as “troubled debt restructurings.”  This and other egregious accounting errors added up to overblown net income figures for the class period, according to the investors.