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Lawyers Settle $62M Fee Allocation Dispute

July 29, 2014 | Posted in : Contingency Fees / POF, Expenses / Costs, Fee Award, Fee Dispute, Lodestar

A recent NLJ story, “Lawyers Settle Fight Over $62 Million in Fees,” reports that lead lawyers in the litigation over hormone replacement therapy drugs, have agreed to resolve their dispute involving $62.3 million in attorney fees for work performed for the plaintiffs’ common benefit.  U.S. District Judge Billy Roy Wilson, of the Eastern District of Arkansas, must approve the settlement, reached after a 16-hour mediation.  A total of 32 law firms will divide $62.3 million in attorney fees.

Zoe Littlepage and Rainey Booth, who won a half-dozen verdicts against Pfizer Inc. over its Prempro HRT drug, will be entitled to 35 percent of the common benefit fund, or $22.1 million.  Both lawyers, who harnessed their separate law firms in a joint venture for purposes of the HRT litigation, objected to the initial plan on how to allocate the common benefit legal fees.  Erik Walker, of Hissey Kientz in Austin, will be entitled to 11.433 percent, or $7.1 million, of the common benefit fund.

All of the lawyers have agreed to a holdback fund of $4 million, which, among other things, will pay for any further fees incurred by the retired federal judge who mediated the fee dispute and other costs.  In a later development, the common benefit fee committee voted 6-1 to pay $2 million out of the holdback fund to Walker’s law firm.  Littlepage dissented, according to Walker’s court filing on July 23.

Walker said in court papers that receiving a high portion of the holdback fund would reflect the work his firm and he did on the HRT litigation.  “I was told that [being given] the highest multiplier at the end would be my compensation for work on nearly all the early bellwether trials.  No fee interest.  Sometimes, not even reimbursement of expenses.  But a promise of the maximum at the end,” Walker wrote.