A recent BLT Blog post, “Lawyers in LivingSocial Class Action Seek $3M in Fees,” reports that lawyers behind a class action against LivingSocial are hoping to collect $3 million in attorney fees, the maximum amount that the two sides agreed to in a settlement.  The fees are on top of the $4.5 million that LivingSocial agreed to pay to settle claims that its deal voucher expiration dates and other restriction violated federal and state laws.

The fee arrangement was spelled out in an agreement that U.S. District Judge Ellen Segal Huvelle gave preliminary approval to in October.  Under the agreement, LivingSocial said it wouldn’t contest a request for attorney fees up to $3 million.  On January 18, the plaintiffs filed a motion for attorney fees, asking Huvelle to order the fee award.

Plaintiffs filed class action in early 2011 against LivingSocial, alleging violations of the federal Credit Card Accountability Responsibility and Disclosure Act and state laws.  The cases were consolidated into a single MDL in D.C. federal court.  The plaintiffs claimed that LivingSocial’s daily deals should be considered the same as gift certificates or gift cards, which can’t have an expiration date of less than five years under federal law.  They accused the company of selling deals with illegally short expiration dates with the knowledge that consumers wouldn’t use them.

In settling, LivingSocial agreed to pay $4.5 million to reimburse consumers with expired deals.  Any leftover funds would go to two nonprofits that work on consumer protection issues, the National Consumers League and the Consumer Union.  The company also agreed to split and specify the expiration dates for the promotional value of a deal -- $10 for $20 of services, for instances – and the actual paid value expired in compliance with federal law of state law (whichever was longer).

In the motion for attorney fees, plaintiffs’ lawyers said that $3 million was reasonable because of the time they put into the case and its complexity, claiming that the figure represented less than five percent of the value of the settlement: the $4.5 million case payment, the estimated $80,000 that LivingSocial spent on administrative costs, and the estimated $54 million in savings for consumers, in light of the policy changes LivingSocial made as part of the settlement.