calattorneysfees.com | December 7, 2015
Class Counsel Asked For $100.8 Million In Fees/Expenses But Were Awarded “Only” $74 Million
On December 4, 2015, a New York federal district judge awarded class counsel in the JP Morgan Chase mortgage-backed securities class action about $74 million in fees and costs based on a $388 million settlement. This was less than the $100.8 million in fees and expenses requested by class counsel.
Eleventh Circuit Applies Percentage-of-Fund Analysis to Claims-Made Class Action Settlements Based On Potential Value of Settlement—Ninth Circuit May Not Agree With This Approach
In Poerther v. The Gillette Co., 2015 WL 4319896 at *1, *4 (11th Cir. 2015), the Eleventh Circuit found that the percentage-of-fund approach should be applied in reviewing the propriety of fees to be awarded class counsel in claims-made class action settlements, eschewing the perspective that the fees should be scrutinized against the actual payouts to class members. (It especially focused on the fact that injunctive and other negotiated relief may have real value.) A recent Florida district court decision has embraced Poerther. (Marty v. Anheuser-Busch Companies, LLC, No. 13-cv-23656-JJO (S.D. Fla. Oct. 15, 2015) [Doc. No. 165].) So, what is the Ninth Circuit’s position on this issue? Likely, it does look at actual payouts to both class counsel and class members as a factor, coupled with review of potentially suspect clear sailing and reversion settlement clauses. (See In re HP Inkjet Printer Litig., 716 F.3d 1173, 1178 (9th Cir. 2013) [“Where both the class and its attorneys are paid in cash ... [t]he district court can assess the relative value of the attorneys’ fees and the class relief simply by comparing the amount of cash paid to the attorneys with the amount of cash paid to the class.”]; see also In re Baby Prods. Antitrust Litig., 708 F.3d 163, 170 (3d Cir. 2013) [“[C]ourts need to consider the level of direct benefit provided to the class in calculating attorneys’ fees.”]; Pearson v. NBTY, Inc., 772 F.3d at 778, 781 (7th Cir. 2014) (Posner, C.J.) [quoting Redman v. RadioShack Corp., 768 F.3d 622, 630 (7th Cir. 2014), the “ratio that is relevant . . . is the ratio of (1) the fee to (2) the fee plus what the class members received.”].)
Nancy Duffy McCarron, CBN 164780
Attorney, Real Estate Broker, BBB Arbitrator, CA Notary Public
Certified Forensic Loan Auditor, Property Manager
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