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Rutgers Blasts $1.6M Attorney Fee Request in COVID Case

January 6, 2022 | Posted in : Class Incentive Awards, Contingency Fees / POF, Fee Award Factors, Fee Dispute, Fee Jurisprudence, Fee Request, Fees & Common Fund, Hours Billled, Lodestar, Practice Area: Class Action / Mass Tort / MDL, Settlement Data / Terms

A recent Law 360 story by Jeannie O’Sullivan, “Rutgers Blasts $1.6M Fee Bid in COVID-19 Fee Refund Suit,” reports that Rutgers University has blasted the $1.6 million counsel fee sought by three firms for representing a class of students seeking refunds after the COVID-19 pandemic torpedoed in-class instruction, arguing the amount cuts too deeply into the compensation fund.  In a brief filed in Middlesex County Superior Court, the New Jersey university said the students would benefit from a lesser fee of $500,000, representing 10% of the $5 million settlement struck by the parties.  The $1.6 million fee — sought by Carella Byrne Cecchi Olstein Brody & Agnello PC, Hagens Berman Sobol Shapiro LLP and Bursor & Fisher PA — amounts to a third of the fund.

"Rutgers does not dispute that the court should award Plaintiffs' counsel a reasonable attorneys' fee, but submits that under the circumstances of this case, the amount Plaintiffs' attorneys have requested would overcompensate them and take too much money out of the hands of the Rutgers students intended to benefit from the settlement," the brief said.  The firms would still be made whole by a $500,000 counsel fee award, Rutgers argued.

"Granting them their full request, by contrast, would cause a significant and unjustified reduction in the amount each current and former student will receive in the settlement," the brief said.  The university said it didn't dispute the class counsel's argument that common fund case fee awards can range from 19% to 45% of the settlements, as evidenced in a product liability suit against General Motors and antitrust litigation against Comcast Corp.

"But we are dealing here with claims by students against a public university," Rutgers argued.  The university pointed to the Second Circuit's 2000 decision in Goldberger v. Integrated Resources Inc., which held that a "'fee award should be assessed based on scrutiny of the unique circumstances of each case.'"

In their fee bid filed Dec. 20, the firms called the settlement an "unprecedented legal accomplishment" achieved on behalf of a 65,000-member class.  The attorneys said they'd expended 943.40 hours as of the filing and noted that the lodestar amount doesn't include additional hours they put in administering and overseeing the settlement.  The filing detailed the trajectory of the litigation, which was filed in May 2020 and "fiercely litigated and opposed" by Rutgers.  The litigation entailed vigorous motion practice, amended complaints and a trip to appeals court, after which a settlement was reached following multiple mediation conferences, the brief said.

The fee ask is justified after consideration of the seven factors courts must consider, ranging from the fund size and number of beneficiaries to awards in similar cases, and comports with professional conduct rules for attorneys, the firms said.  The firms also said the two class representatives are entitled to incentive awards of $2,500 each, given their "initiative, time and effort."