Keepseagle v. Perdue
Keepseagle v. Perdue
Opinion of the Court
On April 28, 2011, the Court granted, among other things, plaintiffs' motion for award of attorneys' fees and costs, awarding class counsel at the high end of the range set forth in the 2011 Settlement Agreement between the parties: 8% of the $760 million compensation fund amount, or $60.8 million, pursuant to the following provision:
Plaintiffs will ask the Court to approve an award of attorneys' fees and costs to Class Counsel, payable as part of the common fund awarded to the Class, with the understanding that the Plaintiffs may seek, and the Court may award, such attorneys' fees and costs the total amount of which shall be at least 4% and not more than 8% of $760,000,000.
Settlement Agreement, ECF No. 576-1 at XV.B; Order, ECF No. 606 at 3. Because a compensation fund had been established, the Court made this award pursuant to the common fund doctrine. See Swedish Hosp. Corp. v. Shalala ,
Class counsel now seek a supplemental award from interest accrued from the compensation fund based on a lodestar calculation and pursuant to the following provision of the 2015 Addendum to the Settlement Agreement ("Addendum"):
In the event counsel seek an award of attorneys' fees and costs for work involved in establishing the Trust and Modifying the Agreement, such award may be made from interest that has accrued from the total Compensation Fund, and may only be with approval by the Court upon a properly noticed motion. The Secretary reserves the right to address the entitlement to fees, the amount of fees, or both entitlement and amount, in any opposition or response.
Addendum, ECF No. 824-2 at IV.C. Specifically, class counsel seek $3,220,035.85 in fees and $46,656.50 in additional costs that they contend were not foreseen and therefore not compensated in the prior award. Final Report to Court on Payments from the Keepseagle Settlement Fund and Mot. for Approval of Final Payments Including Suppl. Att'ys' Fees ("Mot. for Att'ys' Fees"), ECF No. 911 at 10, 18. Class counsel also seek an award of $566,537.50 in fees and $6,987.56 in costs for Mrs. Keepseagle's independent counsel, Olsson Frank Weeda Terman Matz PC ("OFW Law"). Id. Mrs. Keepseagle obtained independent counsel after the Court asked if she would like the opportunity to do so to assist her in her efforts to modify the Settlement Agreement. Id. at 22. Class counsel have provided notice of this request to the class and to the Trustees of the Trust. Id. at 11.
The Addendum was negotiated after the claims process concluded and an unanticipated $380 million remained in the compensation fund for distribution to cy pres beneficiaries. The Addendum was agreed to by class counsel, the government, and Mrs. Keepseagle's counsel, and approved by the Court. See Keepseagle v. Vilsack , No. 99-3119, slip op.,
The government disputes that class counsel is entitled to a supplemental award pursuant to the Settlement Agreement. The government argues that the 8% cap on an award of attorneys' fees and costs was not increased by the Addendum and therefore an additional award is not permitted pursuant to the Settlement Agreement. Def.'s Opp'n to Counsels' Second Fee Pet. (Def.'s Opp'n), ECF No. 912 at 6-8. The Court disagrees. The Addendum clearly contemplates that class counsel and Mrs. Keepseagle's counsel
"When awarding attorneys' fees, federal courts have a duty to ensure that claims for attorneys' fees are reasonable." Swedish Hosp. Corp. ,
The government argues that an additional award is not reasonable on several grounds: (1) the original award exceeded class counsels' actual and projected fees and costs by nearly $34 million and so the extra fees and costs incurred have been covered by that "cushion"; (2) class counsel was overcompensated for their projected costs when the award was made since the amount of unclaimed funds-$380 million-was so large; and (3) class counsels' original award should have been half of what it was because the settlement amount was twice what it should have been. Def.'s Opp'n, ECF No. 912 at 10-12.
Class counsel responds that: (1) the Court has already rejected the argument that the award was too high when it awarded to the cap; (2) as a factual matter, it was not overpaid for the projected costs; and (3) regarding the amount of unclaimed funds, the settlement amount was fully justified by the damages calculation of plaintiffs' expert, but a variety of factors lead to not all class members being able to, or choosing to, make their claims. Pls.' Reply, ECF No. 914 at 3-6. Class counsel also points out that the government does not contest the reasonableness of the rates or hours in their request. Id. at 5.
Class counsels' supplemental request is neither reasonable nor justified. There is no dispute that this supplemental request is for work and costs that were not contemplated in class counsels' 2011 award request. However, the reason class counsel needed to undertake this work and incur these costs, was because of the magnitude of unclaimed funds. Class counsel object to taking into consideration the magnitude of unclaimed funds because the damages calculation was "fully justified." Pls.' Reply, *63ECF No. 914 at 5. The Court disagrees that the magnitude of the unclaimed funds should not be considered. Although the damages calculation was fully justified, the fact is that class counsels' original award was based on a percentage of a compensation fund amount that exceeded successful claims by approximately half. The Court recognizes that the Supreme Court has held it to be a proper application of the common fund doctrine for an award of fees to be based on a percentage of the entire fund even if not all funds were disbursed to class members. See Boeing Co. v. Van Gemert, et al. ,
The Court agrees with class counsel that its work on the Addendum benefitted the class: It resulted in additional payments to successful claimants and the creation of a Trust to benefit the members of the class. And class counsels' work resulted in this Court approving the Addendum and in that approval being upheld on appeal. However, the Court must still determine whether the supplemental award is reasonable. Here, the $60.8 million awarded exceeded class counsels' actual and projected lodestar fees and costs by approximately $34 million.
Class counsel also seek an award of $566,537.50 in fees and $6,987.56 in costs for OFW Law, which represented Mrs. Keepseagle in her efforts to modify the Settlement Agreement. Mot. for Att'ys Fees, ECF No. 911 at 22. OFW Law was instrumental in negotiating the Addendum, which obtained $77 million in additional payments to class members, a supplemental service award of $100,000 to Mrs. Keepseagle, and created the Trust. See Decl. of Marshall L. Matz in Support of Marilyn Keepseagle's Request for an Award of Att'ys' Fees and Expenses ("Matz. Decl."), ECF No. 911-8 ¶ 9. OFW Law also represented Mrs. Keepseagle in her successful Motion to Modify the Settlement Agreement, in successfully opposing the appeal of this Court's approval of the Addendum to the Court of Appeals for the District of Columbia Circuit, and in successfully opposing petitions of certiorari to the Supreme Court. Id. ¶¶ 6, 7.
In response to class counsels' request for this award, the government reiterates its argument that the Settlement Agreement does not authorize the payment, but makes no other objection. Def.'s Opp'n, ECF No. 912 at 12-13. The Court has rejected that argument. See supra at 61-62. The Addendum specifically provides that OFW Law would be able to "seek an award of attorneys' fees and costs for work involved in establishing the Trust and Modifying the Agreement" payable from the interest accrued from the compensation fund. Addendum, ECF No. 824-2 at IV.C.
*64Unlike the Settlement Agreement, the Addendum did not provide for the payment of attorneys' fees as a percentage of the compensation fund. See id. OFW Law has submitted a lodestar request for fees and costs. While the source of any award here will be the interest accrued from the compensation fund, which is distinct from damages awarded by a court pursuant to the fee shifting provisions the Equal Credit Opportunity Act ("ECOA"),
The starting point for determining a reasonable fee is the "lodestar method," which "is the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate." Hensley v. Eckerhart,461 U.S. 424 , 433,103 S.Ct. 1933 ,76 L.Ed.2d 40 (1983). "[T]he lodestar method produces an award that roughly approximates the fee that the prevailing attorney would have received if he or she had been representing a paying client who was billed by the hour in a comparable case[.]" Perdue v. Kenny A. ex rel. Winn,559 U.S. 542 ,130 S.Ct. 1662 , 1672,176 L.Ed.2d 494 (2010). There is a "strong presumption" that the lodestar figure represents a reasonable attorney's fee, id. at 1673, because " 'the lodestar figure includes most, if not all, of the relevant factors constituting a 'reasonable' attorney's fee,' " id. at 1667 (quoting Pennsylvania v. Delaware Valley Citizens' Council for Clean Air,478 U.S. 546 , 566,106 S.Ct. 3088 ,92 L.Ed.2d 439 (1986).
In calculating a reasonable fee award, the Court must make three separate determinations: (1) what constitutes a "reasonable hourly rate" for the services of plaintiff's counsel; (2) the number of hours that were reasonably expended on the litigation; and (3) whether plaintiff has offered "specific evidence" demonstrating this to be the "rare" case in which a lodestar enhancement is appropriate, and if so, in what amount. Miller v. Holzmann,575 F.Supp.2d 2 , 11 (D.D.C. 2008) ; see also Covington v. District of Columbia,57 F.3d 1101 , 1107 (D.C.Cir. 1995). The fee applicant, however, "bears the burden of establishing entitlement to an award, documenting the appropriate hours, and justifying the reasonableness of the rates [.]" Covington,57 F.3d at 1107 (citing Blum,465 U.S. at 896 n. 11,104 S.Ct. 1541 ; Hensley,461 U.S. at 437 ,103 S.Ct. 1933 ). Likewise, "the burden of proving that an enhancement is necessary must [also] be borne by the fee applicant." Perdue,130 S.Ct. at 1673 . [6 ]
Heller v. District of Columbia ,
First, the Court must determine whether OFW Law's rates are reasonable based on its review of OFW Law's: (1) billing practices; (2) skill, experience and reputation; and (3) prevailing market rates in the relevant community.
*65Attached to the declaration are descriptions of the experience and reputation of counsel upon which the rates are established. Id. at 11-27. The Court notes the impressive qualifications of Mrs. Keepseagle's counsel. See id. She was represented by a skilled team of litigators with significant relevant experience at both the trial and appellate levels. See id. Furthermore, the rates are comparable to, and for the most part lower than, the Legal Services Index (LSI) of the Bureau of Labor Statistics Laffey Matrix. Compare Matz. Decl., ECF No. 911-8 at 78 with the LSI Laffey Matrix, available at http://laffeymatrix.com/see.html. Finally, the rates are comparable to, but slightly higher than, the United States Attorney's Office Laffey Matrix. Compare Matz. Decl., ECF No. 911-8 at 78 with USAO Attorney's Fees Matrix, available at https://www.justice.gov/usao-dc/file/796471/download. In this Circuit, either matrix may be used to demonstrate prevailing market rate. See Covington v. District of Columbia,
Next, the Court must determine whether the number of hours expended on the litigation was reasonable. See Heller ,
Finally, OFW Law claims $6,987.56 in costs. The Court has compared the types of costs OFW Law claims to the types of costs the Court originally approved for class counsel and finds them to be for the same type of costs, such as telephone charges, transportation charges, postage, duplicating, filing fees, etc. Compare Matz. Decl., ECF No. 911-8, Ex. D
*66with Decl. of Joseph M. Sellers in Supp. of Pls.' Mot. For an Award of Att'ys' Fees and Costs, ECF No. 581-1, Ex. C. Additionally, the costs are not excessive. Therefore, the Court finds these costs to be reasonable.
Accordingly, the supplemental motion for an award of attorneys' fees and expenses is GRANTED IN PART and DENIED IN PART. Class counsels' request for supplemental fees and costs is DENIED. Counsel for Mrs. Keepseagle are awarded $566,537.50 in fees and $6,987.56 in costs from the interest accrued from the compensation fund. An appropriate order accompanies this Memorandum Opinion.
SO ORDERED.
The lodestar method is the "number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate." Hensley v. Eckerhart ,
When citing electronic filings throughout this opinion, the Court cites to the ECF header page number, not the original page number of the filed document.
Although the term "counsel" is not defined in the Addendum, it was signed by class counsel, Mrs. Keepseagle's counsel, and government counsel. Addendum, ECF No. 824-2 at 6-7.
The Court recognizes that class counsels' actual lodestar fees were somewhat higher than originally projected. See Mot. For Att'ys' Fees, ECF No. 911 at 12 n.4.
See 15 U.S.C. § 1691e(d) ("the costs of the action, together with a reasonable attorney's fee as determined by the court, shall be added to the damages awarded by the court").
OFW Law does not seek a lodestar enhancement. See generally , Mot. For Att'ys Fees, ECF No. 911; Pls.' Reply, ECF No. 914; Marilyn Keepseagle's Reply, ECF No. 915.
Reference
- Full Case Name
- Marilyn KEEPSEAGLE v. Sonny PERDUE, Secretary, U.S. Department of Agriculture
- Cited By
- 3 cases
- Status
- Published