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Walmart Class Action Attorney Fees Must Be Re-Calculated

June 13, 2011 | Posted in : Contingency Fees / POF, Expenses / Costs, Fee Award, Fee Issues on Appeal, Hourly Rates, Lodestar

A recent Legal Intelligencer story, “Superior Court Upholds $187.6 Mil. Class Action Against Wal-Mart” reports that the state Superior Court in Pennsylvania has upheld a $187.6 million class action award against retailer Wal-Mart over allegations that its Pennsylvania employees were not properly compensated for off-the-clock work and missed rest breaks.

At the same time, the panel of Judges John L. Musmanno and Christine L. Donohue and Senior Judge James J. Fitzgerald III also found that the $45.6 million in attorney fees Philadelphia Common Pleas Court Judge Mark I. Bernstein awarded to law firms Donovan Searles & Axler in Philadelphia, Abbey Spanier Robb Abrams & Paradis in New York, Bader & Associates of Denver, and Azar & Associates of Aurora, Colo., must be recalculated.  In its 211-page opinion (pdf), the panel said Berstein “in advertently double-counted” the firms’ contingency fee rates.

When Berstein granted the class counsels to apply a contingency multiplier of 3.7 to their total counsel fees of $12.34 million and $3.58 million in expenses for the work of 26 lawyers and 17 paralegals, among others, he did not take into account that Donovan Searles, as well as Abbey Spanier, had already factored the risk of a contingency fee into their rates, the panel said.  The other firms calculated their rates based on their complex litigation hourly rates.