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Apple Wants Judge to Mull $27M Fee Request in App Case

March 2, 2022 | Posted in : Class Incentive Awards, Contingency Fees / POF, Expenses / Costs, Fee Award Factors, Fee Benchmark / Standard, Fee Dispute, Fee Entitlement / Recoverability, Fee Jurisprudence, Fee Request, Fees & Judicial Discretion, Lodestar, Practice Area: Class Action / Mass Tort / MDL, Settlement Data / Terms

A recent Law 360 story by Gina Kim, “Apple Wants Judge to Mull $27M Atty Fee Bid in App Case” reports that Apple has told a California federal judge that although it won't oppose $27 million in attorney fees requested by software app makers who secured a $100 million settlement in a proposed antitrust class action, it wants the judge to use her discretion when deeming the appropriate amount.  Apple said in its response brief that the requested fee amount from attorneys representing app developer plaintiffs from the $100 million non-reversionary cash settlement is rather high and more than 200% of their lodestar investment.

"While Apple takes no issue with the expenses or service awards sought by plaintiffs, the fee request is high by the standards applied in this circuit and district," Apple wrote in its response.  The Ninth Circuit has advised that class counsel should typically receive about 25% of the ascertainable value of the settlement in attorney fees, Apple said.

Attorneys who represented 6,700 software app developers in the United States asked U.S. District Judge Yvonne Gonzalez Rogers last month to award them $27 million in fees after securing a $100 million settlement — which includes nonmonetary relief — to resolve claims that Apple held a monopoly over its App Store.

The developers' counsel from Hagens Berman Sobol Shapiro LLP and other plaintiffs' firms wrote in their motion for attorney fees last month that the requested fee award is justified, as they spent millions of dollars upfront to work on the case, and tens of thousands of hours facing off against one of the biggest tech names in the world on a contingency basis.

The developers' counsel argued there was added risk to settlement talks, given that the same federal judge overseeing the developer case concluded Apple wasn't a monopoly at the end of another closely watched antitrust case, the Epic Games v. Apple bench trial.  The developers signed their settlement deal with Apple just before Judge Gonzalez Rogers issued her decision in the Epic Games v. Apple case.

But Apple argued that the developers' counsel are entitled to 25% of the $100 million settlement, or $25 million, instead of the requested $27 million, which is nearly two-and-a-half times the lodestar amount of $11 million.  The requested amount is high both in terms of the percentage of the settlement fund and lodestar multiple, the company said.  Furthermore, the Epic v. Apple outcome would have jeopardized any chance for developers to recover anything, the company said in its response brief.  "Counsel did not risk it all here.  A $25 million award, all in, would still be 175% of their investment — a healthy return in any environment, particularly generous in light of Epic," Apple wrote.

"These are real benefits, and they are the product of extensive settlement negotiations between the parties in order to resolve contentious litigation and preserve judicial resources," Apple wrote in its response.  "Class counsel are entitled to be paid for their efforts in litigating this action. The question is how much."

Apple further said that the Ninth Circuit's guidance, that class counsel should typically receive about 25% of the ascertainable value of the settlement in attorney fees, "protects absent class members by ensuring that the majority of the cash achieved in settlement — 75% or more — is available to the class members rather than the lawyers."

"These values would be jeopardized if courts were routinely to examine uncertain non-monetary terms to increase the fee award," Apple wrote.  Ultimately, Apple said it is not opposing an entry of a fee award requested by the developers. Instead, the company is reminding the judge that she can use her discretion to award a different fee amount to the developers' counsel, Apple wrote in its response.