A recent Law.com story by Amanda Bronstad, “Federal Judge in Norfolk Southern Cases Warns Lead Attorneys: Keep Costs Down,” reports that a federal judge overseeing more than 30 lawsuits against Norfolk Southern insisted at a hearing that attorneys vying for leadership avoid soaring attorney fees and legal costs that would reduce potential compensation to the community. “I want to make sure the residents are treated fairly,” U.S. District Judge Benita Pearson of the Northern District of Ohio said at the Zoom hearing. “That there is a proportional distribution that isn’t overly consumed by the fees and costs of the attorneys.”
At the hearing, Pearson listened to two competing groups of lawyers hoping to lead the growing lawsuits over the Feb. 3 derailment, which exposed the East Palestine, Ohio, community to toxic chemicals in some of the cars. However, her focus was on the local residents and businesses, which have suffered economic and property damages and, in some cases, medical problems.
Pearson told lawyers that the leadership team, whichever she chooses, should appoint a community liaison to make sure local residents are aware of developments in the litigation, particularly the class actions, which are likely to be consolidated. And she does not want the legal bills to subsume whatever compensation could come from a potential settlement. Now, the federal judge advised the litigants that she is planning to enter a ruling early next week.
And Pearson’s remarks about costs reflect a growing concern on the bench, particularly in class actions. Former U.S. District Judge Lucy Koh, now on the U.S. Court of Appeals for the Ninth Circuit, for instance, entered orders in data breach class actions against Anthem, trimming the proposed leadership team and hiring a special master to review a $38 million billing request by 53 law firms.
Most Norfolk Southern cases are class actions, but some have individual plaintiffs. Also suing are the state of Ohio and a Pennsylvania school district. On Friday, the U.S. Department of Justice, on behalf of the Environmental Protection Agency, sued over Clean Water Act violations. Those cases are expected to end up transferred to Pearson’s courtroom.
‘They’re Too Big’
Two competing teams want to lead the cases—one with 37 lawyers from some of the nation’s largest firms; and another group, less than half that size, calling itself “Team Ohio.” A member of the larger team, Seth Katz, of Burg Simpson Eldredge Hersh & Jardine in Englewood, Colorado, said lawyers metto discuss adding three members of the competing slate to his group. But there was no agreement.
“Our view of the leadership, in this case, from day one has been that there needs to be some negotiation with respect to the co-lead positions in this case,” Ron Parry of Cincinnati’s Strauss Troy, and a member of “Team Ohio,” explained. “They have four co-lead attorneys and are not interested in listening to any other proposition. Our view is that’s something that should be negotiated.”
But Katz, one of the four co-leads of his proposed team, defended the choice of having four national firms at the helm. “This is a case that has the national eye,” he said. He said his group has a “great mix” of Ohio and Pennsylvania firms, as well as “national law firms that have the resources, knowledge and experience to guide this case to where it needs to go.”
“This is a big case,” he said. “It’s a very important case. And there’s going to be a lot of work.” Pitching “Team Ohio” was Steve Berman, managing partner of Hagens Berman Sobol Shapiro. He noted that, although he is in Seattle, he represented the state of Ohio in previous litigation against Big Tobacco and opioid companies. On March 14, Ohio Attorney General Dave Yost sued Norfolk Southern over the derailment.
His team has eight firms—far fewer than the competing group’s 37 that are “going to drive up the fees and costs.” “They’re too big,” he said of his rival team. “And the residents of the community, at the end of the day, want a team that’s not going to rack up too much money in fees and costs.”