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Category: Fee Benchmark / Standard

AT&T Attorneys Seek $3.5M in Fees in $14M Settlement

August 17, 2022

A recent Law 360 story by Kelly Lienhard, “AT&T ‘Bait-and-Switch’ Customer Attys Want $3.5M in Fees reports that attorneys who secured a $14 million settlement for a group of AT&T customers claiming they were charged an improper fee asked a California federal court for a $3.5 million cut of the award to cover their legal fees, as well as additional funds to cover litigation expenses.  The requested fee is 25% of the full settlement amount, which aligns with the Ninth Circuit's benchmark for attorney fees, according to the attorneys' motion, and is warranted based on the risk taken and time spent on the case.

"[The fee] is well justified under the circumstances of this case, including in light of the significant risk settlement class counsel assumed in taking this case on and vigorously litigating it for years notwithstanding the possibility that the case could ultimately be derailed on arbitration or any number of other grounds," the counsel stated.  AT&T agreed to the $14 million settlement to avoid litigation after its customers sued the telecom company over claims that the company used bait-and-switch tactics by applying an "administrative fee" to customers' accounts.

The customers' counsel is asking for 25% of the settlement amount to cover their fees and almost $75,000 for litigation expenses.  According to the attorneys, over 4,674 hours were devoted to the case, with more work still ahead to secure the finalized settlement.  The work was done with no guarantee that the lawyers would see any compensation, with additional challenges that come with going up against a large, well-funded company, according to the attorneys.

The customers' counsel added that a lodestar-multiplier cross-check found that the requested $3.5 million fee represents a little less than 128% percent of the $2,754,739 in attorney fees accumulated so far in the case, which is at the lower end of the range typically awarded, the attorneys said.

$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 million in costs to Boies Schiller Flexner LLP, Hausfeld LLP and other lawyers who scored a $2.67 billion class award for subscribers in multidistrict litigation against Blue Cross Blue Shield insurers. 

The fees represent 23.47% of the $2.67 billion settlement fund, which U.S. District Judge R. David Proctor said falls within the lower half of the Eleventh Circuit's "benchmark range" of 20% to 30%.  He also gave final approval to the settlement itself.

The fees amount is "fair and reasonable" given the nature of the settlement, according to the judge, who noted that "the settlement also provides historic, transformative, pro-competitive injunctive and equitable relief that will greatly benefit the members of the subscribers class."

The nation's BCBS insurers agreed in 2020 to the $2.67 billion class settlement fund and sweeping anticompetitive practice reforms to settle the long-running multidistrict suit based in Alabama federal court that was filed by dozens of subscriber groups. 

The multidistrict litigation, opened in January 2013, accused dozens of mostly nonprofit BCBS-affiliated insurers of using trademarking and other practices, including limits on non-Blue revenues to suppress competition. The MDL eventually grew to include more than 40 plaintiffs' groups nationwide.

Judge Cuts $4.9M Fee Request in ICloud Storage Action

August 5, 2022

A recent Law 360 story by Kelly Lienhard, “Judge Slashes Attys’ $4.9M Fee Bid in ICloud Storage Suit” reports that Apple will settle for $14.8 million over claims that it misled users on how iCloud services stored data after receiving final approval from a California judge, but only has to pay the class counsel standard fees despite requests from the attorneys for a higher award.

While the Northern California District Court elected to grant the full monetary amount requested by a class of iCloud subscribers, it reduced the fees awarded to Roy A. Katriel of the Katriel Law Firm PC and Azra Mehdi of the Mehdi Firm PC from $4.9 million to $3.7 million based on findings that the case was not exceptional enough to warrant giving the attorneys more than the standard payout.

"Although class counsel — who are two sole practitioners — skillfully litigated the case, it was not a sufficiently exceptional case to warrant more than the benchmark in attorney's fees," U.S. Magistrate Judge Laurel Beeler wrote in the  court order.

Katriel and Mehdi had requested 33% of the settlement amount, totaling $4.9 million, based on claims that they undertook significant risks, put in a substantial amount of work and succeeded in winning excellent results for the represented consumers.  However, Apple argued that the established fee of 25%, or $3.7 million in this case, was more appropriate.

The district court agreed with the tech giant, stating that class counsel failed to show that the case was complex or novel enough to warrant departure from the typical 25% counsel award.

Katriel and Mehdi alleged that the case was "exceptionally" complex, pointing to more than four years of work including 10 depositions, seven adversarial motions and thousands of pages of complex discovery from Apple.  The lawyers added the results from their work were extraordinary, as all class members are to be paid without needing to submit a claim form.  They also pointed out that the settlement won represents more than 40% of the damages calculated by an economic expert.

The attorneys' strongest argument, according to the district court, is the $400,000 spent on working the case, which points to an increased risk.  However, Beeler said that it alone is not enough to justify departing from the typical attorney fee.

Judge Trims Fee Request in Apple Bag Check Class Settlement

July 7, 2022

A recent Law 360 story by Bonnie Eslinger, “Alsup Cuts 33% Apple Bag-Check Deal Atty Fee Ask to 30%” reports that U.S. District Judge William Alsup said the lawyers who represented workers in a bag-search case against Apple that settled for $30.5 million can get 30% for their fees, but not the one-third requested, noting that the hours counsel said they spent on the case are "staggering" and likely "inflated."

At a morning hearing in San Francisco, Judge Alsup initially told counsel for the certified class of 14,000 workers that he was inclined to award 28% of the settlement fund for their legal fees, a few percentage points higher than the federal court's 25% benchmark.  "I don't agree with the one-third, but I agree that you get more than 25% because I think you did do above average work," the judge said.

Counsel for the class, Lee Shalov of McLaughlin and Stern LLP, told the court that the lawyers collectively racked up 11,400 hours of work on the case, a total the judge said seemed excessive, even with the case going to the state's high court at one point.  "It's staggering," the judge said.  Another lawyer for the class, Kimberly Kralowec of Kralowec Law PC, urged the court to grant the one-third cut requested, arguing that California law governs the calculation of the fee award where there are state law claims, citing cases where the Ninth Circuit approved a higher amount.

Judge Alsup shot back that if counsel was not happy with his 28% offering, perhaps he should look into whether the number of hours the lawyers claimed they put into the case showed that their work was inefficient.  "What I'm thinking about doing is appointing one of these auditors who will come in and scrutinize your lodestar [hours], which I believe is inflated," the judge said. "You can either take the 28% or we'll go back and do it the hard way."

The judge also said he was trying to ensure the most amount of money went to the class members.  He added that a higher percentage might be justified with a smaller settlement amount.  "But in a case where you are collecting vast amounts, like $30 million, then instead of getting more you should get less in my view," the judge said, explaining that "25% of a huge number is a lot more than 25% of a smaller number."

Kralowec told the court that she was arguing for the sake of making a record, but the class would go along with the court's decision.  "I appreciate that you've decided to award something above the 25% benchmarked by the Ninth Circuit," she said.

Shalov chimed in and told the court that counsel had secured every dollar for the workers that they should have been paid.  Judge Alsup said that was not a convincing argument.  "That money belongs to the class, it doesn't belong to you," the judge said.  "However, I'm going to raise it to 30%."

Class Counsel Seek $66M in Fees in $160M Capacitor Antitrust Case

June 24, 2022

A recent Law 360 story by Dave Simpson, “Attys Seek $66M Fee in $160M Capacitor Maker Antitrust Deal" reports that attorneys for a class of direct purchasers of capacitors asked a California federal court to approve $66 million in fees as a part of a proposed settlement in which Nippon Chemi-Con and its U.S. subsidiary would pay $160 million to end antitrust claims.

While the fee request amounts to 40% of the settlement fund, the attorneys noted that the newest proposed settlement would bring the overall recovery in the case to more than $604 million, and the newest fee request would bring total attorneys' fees to more than $187 million.  When taken in totality, and if approved, attorneys would recover a bit over 31% of all the proposed settlements in the case, the attorneys noted.

The motion also notes that, in the Ninth Circuit, the benchmark for percentage of recovery awards is 25% of the total settlement award, which can be adjusted up or down.  "The complexity of this case, the significant benefits achieved for the class and the excellent work performed support an upwards adjustment," the direct pursers said .

This latest deal was struck in December, just before closing arguments in a federal trial, by a class of about 1,800 U.S. companies with Japan-based Nippon Chemi-Con Corp. and its U.S. subsidiary United Chemi-Con.  It ended a weekslong jury trial over claims that more than 20 capacitor manufacturers carried out a price-fixing conspiracy from 2002 to 2014 and owed refunds of $427 million.  The litigation dates back to July 2014, when Chip-Tech Ltd. filed the first suit in the consolidated case.

When the parties informed the court that they had reached a settlement, Judge Donato — who has overseen the case for about seven years — told them that, by this point, he had heard most of the evidence and had his own sense of what constitutes an appropriate settlement amount.  "I'm advising you," Judge Donato said, "that if the settlement is too low, it will not be approved."  "I'll tell you $5 million is not going to fly," the judge added, referring to the deal Matsuo struck to settle out of the case midway through the trial.

The attorneys touted the overall recovery as greater than the total alleged overcharges.  "This is a large amount of money relative to the settling defendants' individual and collective capacitor sales to class members between 2002 and 2014 and is over 141.4% of the total overcharges ($427,530,613) as calculated by the class's expert — an extraordinary result," the attorneys said.  "Courts have approved equal or higher upward adjustments from the benchmark in cases where the settlement was a much lesser percentage of single damages."