A recent Law 360 story by Jeff Montgomery, “Dole Shareholders Garner $18.5M in Fees in Securities Cases,” reports that attorneys for a Dole Food Co. stockholder class secured an $18.5 million fee award as part of a $74 million settlement in a Delaware federal securities suit targeting insider efforts that artificially depressed Dole’s stock price in 2013.

The fee, along with about $694,000 for expenses and costs, went to lead counsel Bernstein Litowitz Berger & Grossmann LLP and Entwistle & Cappucci LLP and liaison counsel Friedlander & Gorris LLP, in a case focused on damage to those who relinquished their shares before Dole sold the company into private ownership for $1.6 billion.

U.S. District Court Judge Leonard P. Stark said the uncontested settlement terms were both fair and reasonable, and reflected the significant risk taken by attorneys in pursuing damages to former investors unable to receive shares of a separate, $101 million Chancery Court award in a related Dole stockholder case.

“The claims on behalf of persons who sold stock before the closing were going to be released, but they were not going to receive any consideration,” class attorney Vincent R. Cappucci of Entwistle & Cappucci said.  He added later that suit required “tremendous work by experts in analytics.”

In August 2015, Vice Chancellor J. Travis Laster found that Dole CEO David Murdock and General Counsel C. Michael Carter breached their fiduciary duties to shareholders in connection with the take-private deal.  Both were said by Vice Chancellor Laster to have acted in “intentional bad faith,” with Carter alleged to have engaged in fraud and the two found jointly and severally liable for $148.19 million in damages.  The award covered both holders of stock in the run-up to the go-private closing and parties who launched a separate suit challenging Dole’s appraised value.

In the August opinion, Vice Chancellor Laster concluded that Murdock and Carter’s effort to drive down Dole’s share price and their alleged misrepresentations during negotiations reduced the company deal price by 16.9 percent, or $2.74 per share.

Judge Stark said the subsequent $74 million federal court settlement was large “not only in the abstract, but more importantly it represents a substantial percentage of what the plaintiffs believe is the maximum possible recovery — right around a third of the best scenario in the plaintiffs' estimate.”

Class attorney Katherine M. Sinderson of Bernstein Litowitz said interest also will be applied to both the fee award and the class payment, which will be distributed proportionally to investors.  The $639,000 in legal expenses approved by the court, Sinderson said, were well below the $1.3 million possible for the case.

Judge Stark said the case involved many complex issues, some novel or unprecedented, as well as statute of limitation concerns.  The complications in the contingent fee case created a significant risk that the stockholders and attorneys “may have had nothing had the case proceeded all the way through trial and an inevitable appeal,” the judge said.

The case is San Antonio Fire and Police Pension Fund et al. v. Dole Food Co. Inc. et al., case number 1:15-cv-01140, in the U.S. District Court for the District of Delaware.