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Attorneys Seek $4.6M in Fees in Sweeping ERISA Case

January 3, 2022 | Posted in : Class Incentive Awards, Contingency Fees / POF, Expenses / Costs, Fee Award Factors, Fee Request, Hourly Rates, Hours Billled, Practice Area: Class Action / Mass Tort / MDL, Settlement Data / Terms

A recent Law 360 story by Kellie Mejdrich, “Walgreens Workers Attys Seek $4.6M in Sweeping ERISA Case,” reports that attorneys representing a class of nearly 200,000 participants in a 401(k) plan run by Walgreens asked an Illinois federal judge to award them $4.6 million for their work securing a settlement worth nearly $14 million.  Sanford Heisler Sharp LLP and local counsel Barnow and Associates PC submitted their fee request, teeing up a February hearing on the $13.75 million settlement, which won preliminary court approval in November.

The suit, filed in August 2019, accused Walgreens of violating the Employee Retirement Income Security Act by offering poorly performing and high-fee mutual funds as part of its 401(k) retirement plan.  Those shoddy plan options cost retirement savers some $300 million since 2014, the plaintiffs said.  "In this case, class counsel were among the few firms in the country with the legal and financial experience necessary to litigate such a complex class action, a background they leveraged to obtain an outstanding result for the class," Sanford Heisler and Barnow and Associates said in a memorandum in support of attorney fees, reimbursement of expenses and service awards.  The attorneys said that no class member had objected to the settlement to date.

The firms said that the attorney fees award represented a third of the $13.75 million gross settlement, which was in line with market rates and routine awards to class counsel in similar ERISA cases.  According to the supporting memorandum, the attorney fees would include approximately $50,000 in costs and expenses incurred by the two firms — mostly by Sanford Heisler.  The firms said the sum was equal to roughly 40% of the $34 million in estimated damages caused by the poorly performing funds since January 2018, five years after they were added to the plan.

Sanford Heisler reported more than 3,563 hours in attorney and staff time, and Barnow and Associates reported approximately 79 hours.  In addition to the thousands of hours and out-of-pocket expenses devoted to the case, Sanford Heisler interviewed more than 200 current and former plan participants, conducted a review of the plan, and analyzed the challenged funds during the case, the memorandum said.  Attorneys also requested a $15,000 service award for each of the 14 named plaintiffs.