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Category: Practice Area: Class Action / Mass Tort / MDL

Attorneys Earn $71M in Fees in $1B Surfside Settlement

August 29, 2022

A recent Law 360 story by Carolina Bolado, “Attorneys Get $71M in Fees For $1B Surfside Settlement Work” reports that the judge overseeing the consolidated litigation over the collapse of the Champlain Towers South condominium in Surfside, Florida, approved about $71 million in attorney fees for class counsel who secured a global settlement of more than $1 billion for the victims.  In a hearing, Miami-Dade Circuit Judge Michael Hanzman said he would award $65 million in attorney fees for work by counsel in bringing the case to a close about a year after the collapse of the beachfront condominium tower on June 24, which killed 98 people.

He added $6.5 million in fees for work attorneys have performed in recent weeks guiding victims' families through the now-completed claims process.  Coupled with the $5.65 million Judge Hanzman awarded to court-appointed receiver Michael Goldberg and the three firms that represented him — Akerman LLP, Berger Singerman LLP and Boyle Leonard & Anderson PA — for their work handling the receivership of the condominium association, the total fees amount to about $77 million.

The judge noted that amount is between 6% and 7% of the total $1.2 billion recovery obtained for victims of the collapse, far less than what victims would have had to pay had they retained counsel and litigated claims on their own.  Judge Hanzman commended the attorneys, who worked the complicated case "in a glass house and under extreme pressure."  He said they signed on at the beginning of the case, when expected recovery was $200 million to $300 million and the court had warned them not to expect any fees.

"This case could've been a disaster for them," the judge said.  "There was so much potential to go off the rails.  They could've been stuck in a decade-long slog with no compensation."  Class counsel had requested a lodestar fee amount of about $22 million, multiplied by 4.5 to get to just over $100 million.  The judge agreed a multiplier was warranted, given the extraordinary result, but he was unwilling to go that high.

At the hearing, co-lead counsel Harley Tropin of Kozyak Tropin & Throckmorton, told Judge Hanzman that "whatever you award us is good with us."  "We had one goal: Recover as much money as we could," Tropin said.  "I hope you think we did a good job. Whatever you award us, we're good."

Following the hearing, Tropin and co-lead counsel Rachel Furst of Grossman Roth Yaffa Cohen PA said in a statement that they were "grateful to have had the opportunity to represent the victims and serve the court."  "We are grateful for the recognition of our work in the form of this fee award and for having this brought this case to a conclusion for the victims," they said.

The funds going out to the victims will come from the $1 billion from a global settlement with a number of parties, insurance proceeds from the condominium association's policies, and $120 million from the sale of the property to Dubai, United Arab Emirates-based buyer Damac Properties PJSC.

Apple Urges Judge to Cut Fees in iPhone Class Settlement

August 26, 2022

A recent Law 360 story by Piper Hudspeth Blackburn, “Apple Urges Judge To Trim IPhone Class Atty Fees” reports that Apple Inc. has asked a New York federal judge to lower a $6.6 million fee request from attorneys who helped secure a $20 million class settlement for iPhone users over device updates, insisting that there is a lack of documentation supporting the price tag.  While attorneys from Pomerantz LLP and Bronstein Gewirtz & Grossman LLC have asked for one-third of the payout for their services, Apple wants the award shaved by $666,000 to 30% of the total settlement, or exactly $6 million. The reduction, Apple argued in a brief, would provide an additional $600,000 to the class and give each member a payment of $68.56, up from $62.94 at the current number of claims.

Apple also took aim at the plaintiff's counsel's billable hours, calling their submission "insufficient."  According to Apple's memorandum, the class's counsel failed to submit any documentation that "substantiates" the over 10,000 hours they billed for the suit that lasted more than six years.  "Class Counsel merely provide a chart listing the names of billers, their requested hourly rate, and an aggregate number of hours each worked, with no elucidation as to whom did what," the motion said.

In an Aug. 12 motion for attorney fees, the plaintiff's attorneys said the fee is warranted given the number of hours they spent working on the suit and the expenses they incurred in the process – as well as the favorable outcome they achieved.  "From the outset, class counsel understood they were embarking on a complex, expensive, and likely lengthy litigation with no guarantee of ever being compensated for the substantial investment of time and money the case would require," the attorneys wrote.

Apple also asked the court to reduce the requested $2.8 million in litigation expenses and service awards of $15,000 for each named plaintiff.  Apple contends that a reduction of the amount of the plaintiff's service award is warranted because the plaintiffs would receive an award one hundred times greater than the maximum recovery afforded to class members.  Apple also took issue with the reported costs for meals, taxis and online research, which they said were not recoverable.

Court Cuts Attorney Fees in $180M First Energy Class Settlement

August 23, 2022

A recent Law 360 story by Hannah Albarazi, “FirstEnergy Investors Get $180M OK’d, But Atty Fees Cut” reports that an Ohio federal judge gave final approval to FirstEnergy Corp.'s $180 million settlement with investors who brought derivative suits over a bribery scandal embroiling the electric utility company and the state legislature, while reducing the attorney fees in the case by more than $12 million.  U.S. District Judge Algenon L. Marbley lowered the plaintiffs' attorney fees from the roughly $48.6 million they requested to $36 million and granted final approval to the $180 million settlement, ending shareholder derivative actions over the so-called HB6 scandal and clearing the path for a slate of corporate governance reforms to begin.

The granted attorney fees represent 20% of the settlement pot, as opposed to the 27% that plaintiffs' counsel requested.  The judge said he extensively deliberated about the factors that went into the fee award and said the figure he arrived at "appropriately accounts for counsel's labor, risks and results" in the case.  Among other things, he noted a lack of depositions that "would have demanded more intensive labor and, thus, greater risks under the contingent fee arrangement" and a "recognition of the advantages to 'coattailing' a major government investigation."

"If FirstEnergy cannot be made perfectly whole in monetary terms, then the next-best outcome is to repair its reputation with prompt, forward-looking reforms designed to prevent a recurrence of the alleged conduct.  The proposed settlement meets that mark," Judge Marbley further wrote in his order.  He noted that this settlement captures about 82% of the available insurance coverage, which is the main source of recoverable assets.

The lawsuits consolidated in the Southern District of Ohio revolved around a scheme by FirstEnergy to bribe then-Ohio House Speaker Larry Householder in order to receive a $1.3 billion bailout of its nuclear power plants.  The company admitted in July 2021 to paying the bribe and paid a $230 million penalty to escape prosecution.

U.S. District Judge John Adams, who is overseeing the case in the Northern District of Ohio, has spoken out against the settlement in the Southern District of Ohio, accusing the parties of forum shopping in order to find a court more favorable to the proposal than his.  Judge Adams has refused to dismiss the case before him and has called for the appointment of new lawyers to oversee that case.

But a special litigation committee composed of independent directors of FirstEnergy objected to the attorney fees, arguing that the plaintiffs weren't alone in working to improve the company. The committee told the court that it helped institute some of the corporate reforms that shareholders' attorneys were trying to take credit for as part of the settlement.

Plaintiffs' counsel have told the court that the settlement — which is funded by the company's insurers — is "among the largest derivative recoveries ever achieved" in the U.S. and is "three times greater than any prior derivative recovery in the history of the Sixth Circuit."

In his order, Judge Marbley didn't get distracted by the record-breaking settlement amount.  "Still, the monetary component of the settlement deserves some scrutiny," he wrote.  "While the recovery is substantial, so too were the harms resulting from the alleged bribery scandal."

Attorneys Seek $13M in Fees in Pork Antitrust Settlement

August 22, 2022

A recent Law 360 story by PJ D'’Annunzio, “Attys Seek $13M Payout For Pork Antitrust Deal With Eateries reports that attorneys representing commercial pork buyers asked for $13.2 million in fees for their role in negotiating a $42 million settlement between a group of restaurants and Smithfield Foods in multidistrict litigation over an alleged meat industry scheme to inflate prices.  In a memorandum, a class of commercial and institutional indirect pork purchasers urged the court to award fees using a "percentage of the funds" calculation, in this case, 31% of the gross settlement proceeds.

"The $42 million settlement before the court is the result of extensive work done by counsel for the CIIPPs on a contingent basis," the memorandum said.  "Counsel has worked for over four years and have invested thousands of hours to pursue the CIIPP claims.  Counsel for the CIIPPs request an interim award of attorneys' fees for the work done to achieve this settlement."  Minnesota U.S. District Judge John R. Tunheim preliminarily approved the $42 million settlement between Smithfield and the pork purchasers in an April order.

In addition to the money, Smithfield agreed to cooperate in prosecuting claims against the remaining defendants, which include big names like Tyson Foods and Hormel Foods Corp., in the large-scale litigation.  The purchasers' memorandum said four years of litigation resulted in roughly 16,800 attorney hours and 2,560 hours for legal assistants and other professionals.

"Given the excellent results achieved, the complexity of the claims and defenses, the real risk of nonrecovery, the formidable defense teams, the delay in receipt of payment, and the substantial experience and skill of counsel, the requested multiplier on the lodestar and the resulting fee is reasonable compensation for the work done by counsel for the CIIPPs," the purchasers said.  Additionally, the purchasers asked for an award of $7,500 to each plaintiff representative.

Hagens Berman Earn $5.3M in Fees in Sasol Settlement

August 19, 2022

A recent Law 360 story by Emilie Ruscoe, “Hagens Berman Nabs $5.3M in Fees Over Sasol Investor Deal” reports that attorneys who represented investors in South African energy and chemical company Sasol Ltd. will get nearly $5.3 million for their work on the case after brokering a $24 million settlement deal with the company to end claims it hid risks taken as it built a facility in Louisiana.  In an order, U.S. District Judge John P. Cronan said the investors' Hagens Berman Sobol Shapiro LLP legal team could have 22% of the settlement fund and nearly $432,000 to cover their litigation expenses. Together, the attorney fee and the reimbursement sum total over $5.7 million.

"Lead counsel conducted the litigation and achieved the settlement with skill, perseverance, and diligent advocacy," the order states, adding later that the fee and reimbursement sums are "consistent with awards in similar cases."  Judge Cronan also said lead plaintiff David Cohn could have $20,000 and additional plaintiff Chad Lindsey Moshell could have $15,000 from the settlement fund to reimburse their "reasonable costs and expenses directly related" to the litigation.

The court's order comes a day after a final hearing on the proposed fee and reimbursement sums and adopts language proposed by the investors in July, when they filed the request for the attorney fees.  The order also noted that none of the members of the class had objected to the settlement sum, despite the fact that nearly 90,000 potential class members had been mailed notices about the final hearing, and that the attorneys spent an estimated 6,000 hours on the case since moving to become lead counsel in the matter in April 2020.

$627M in Attorney Fees in BCBS MDL

August 9, 2022

A recent Law 360 story by Jack Karp, “Boies Schiller, Hausfeld Score $627M in Fees in BCBS MDL” reports that an Alabama federal judge awarded $626.6 million in attorney fees and another $40.9...

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