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Category: Fee Request

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.

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 Monday 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' Monday 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 said they signed up with AT&T thinking they would pay a "particular monthly price" for their wireless service, according to the suit. But the customers alleged that in 2013, the phone company added an "administrative fee" of 61 cents to their bill each month and hiked the fee to $1.99 per month over the next five years.

Now, 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.