A recent Law 360 story by Bonnie Eslinger, “Del Taco ‘Perplexed’ By Atty Fee Bid in $50M Deal”, reports that a California judge who tentatively awarded Del Taco workers' attorneys $12.5 million in fees for their work securing a $50 million wage deal said he's "perplexed" by their arguments for $16.7 million, saying they should have included legal authorities supporting the higher amount in an earlier court filing. In his tentative ruling, Alameda County Superior Court Judge Evelio Grillo largely signed off on the $50 million deal, which settles wage and hour claims filed on behalf of more than 50,000 workers and also allegations of California labor code violations filed under the state's Private Attorneys General Act. With regard to attorney fees, the court awarded a 25% cut of the $50 million, less than the one-third share requested.
At the start of a hearing held via Zoom, Judge Grillo told lawyers for the fast-food workers that he had tried to be responsive to arguments they had previously made in support of their fee request, but "I understand that you're still not happy with what I did." Matthew Matern of Matern Law Group PC, a lawyer for the workers, said while they appreciated the court's consideration of their arguments, there was no reason not to award 30% or more in fees. Among the cases he cited in support of his argument was a 2006 decision in Allapattah Services, Inc. v. Exxon Corp, awarding attorneys 31.33% of a $1.075 billion settlement.
"There were many other cases," Matern told the court. "And in many of those cases, the multipliers were very high as well." Judge Grillo noted that the last time plaintiffs' counsel argued for a higher fee percentage they cited two cases. "You argued successfully that the court should consider a higher multiplier," the judge said. "And that's what I did."
Matern argued that the multiplier — an amount the total fees are multiplied by in determining a fee award — should be used simply as a "cross-check" to see whether the percentage awarded of the total settlement is reasonable.
Judge Grillo asked what the multiplier would be for in the case before him if he was to award 30% of the settlement to the lawyers. Matern said it would be about 6.5. "There are many cases where it's over that," Matern told the court, saying that in the 1995 Weiss v. Mercedes-Benz of North America ruling has a 9.3 multiplier for the attorney fees.
The judge could find additional cases in support of the fee argument cited within a 2017 district court decision In re: National Collegiate Athletic Association Athletic Grant-In-Aid Cap Antitrust Litigation, which was affirmed by the Ninth Circuit, Matern said. Another case in support of high multipliers, Matern told the court, is In re Merry-Go-Round Enterprises, Inc., a 2000 case in Maryland federal court.
"That one was a bankruptcy case, and they awarded a 19.6 multiplier on a 40% fee out of a $185 million fund," Matern said. Ultimately, the court should grant the requested fees, because the lawyers for the Del Taco workers achieved an exceptional result, Matern argued.
"It was obtained for the class and this wouldn't have happened without the exceptional work we did and the substantial risk," the lawyer said. Judge Grillo said he'd look at the other cases the lawyer cited. "I'm a little bit... 'perplexed' is not the right word, but for lack of a better word, perplexed because you did cite me a couple of cases and I did read them," the judge said.
The judge had previously suggested that a multiplier used in a case affirmed by the Ninth Circuit, Vizcaino v. Microsoft Corp., was appropriate, Mattern noted. Then, after the plaintiffs had highlighted a different case for the court, Steiner v. Am. Broad. Co., in which the Ninth Circuit concluded that a 6.85 multiplier "fell within the range of multipliers that courts have allowed," it appeared that Judge Grillo had picked a multiplier between those two, the lawyer said. But in the Vizcaino case that was a 28% fee cut, so the court used the 3.96 multiplier, "because that's what it took to get to the 28% that they awarded," the lawyer said. "So it was merely just cross-checking."
The judge said he understood the argument, and he would put out a ruling later. "You gave me the authorities, I considered them, and now you're suggesting that there are other authorities that I should consider," the judge said. "I'll do that. But you know, it would have been nice to have them, to have those arguments initially." According to the judge's tentative ruling, the lawyers for the plaintiff told the court they spent 3,140.8 attorney hours and 1,231.0 support staff hours for a total of 4,371.8 hours on the case.
The settlement also proposed a service award of $20,000 to the main plaintiff, Karolina Torrez. In his tentative ruling, the judge said after factoring in administration costs, a PAGA payment of $1.5 million, awards for other plaintiffs, and litigation expenses, the amount left to distribute to the class would be just over $30.7 million, providing an average payment per class member of about $615.