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Lenovo Fights Fee Request in Laptop Litigation

November 17, 2014 | Posted in : Expenses / Costs, Fee Dispute, Fee Request, Lodestar

A recent NLJ story, “Lenovo Fights Legal Fee Request in Laptop Litigation,” reports that Lenovo Inc. is blasting as “fantasy” a fee request by plaintiffs attorneys for eight times the attorney fees the company says they are due for crafting a relatively simple class action settlement over laptops with WiFi connection problems.

Lenovo contends plaintiffs’ counsel in Kacsuta v. Lenovo have built their nearly $9 million fee request on “wildly unsupported assumptions,” including that all 83,201 class members will be eligible to make a claim and will actually do so, and that will opt to have their Ultrabook laptops repaired, at an estimated value of $600.

According to studies in “claims-made” settlements fewer than 10 percent of class members typically make claims, according to Lenovo’s Nov 7 memorandum opposing what it calls an “astronomical” fee request.  That reduces the chance the settlement will reach the $50 million in value estimated by plaintiffs.

“Plaintiffs’ ‘value’ of $50 million is based on fantasy compounded by fantasy and cannot be accepted,” Lenovo argues.  The company puts the settlement value at $1.06 million to $2.37 million.

The deal, provisionally approved Aug. 22 in U.S. District Court for the Central District of California, offers a menu of benefits for purchasers of Lenovo U310 and U410 Ultrabook IdeaPad laptops, which originally sold for between $729 and $1,200 each.

Under the terms of the proposed settlement, Lenovo will repair the wireless capability of devices that previously have not been returned to the company.  Those who do not opt for repair will be eligible for either a $100 cash refund or $250 credit towards a purchase of any Lenovo product.  The company also offers reimbursement of documented out-of-pocket repair costs.

The plaintiffs’ attorneys justify their fee request by citing the 8,628 hours they worked on the case, the complexity of the legal and technical issues involved, and the generous benefits negotiated for class members.  They used the lodestar method to calculate the fees, and applied a 2.84 multiplier.  They also are requesting $300,000 in expenses.