Three members of the settlement class in the Flint water crisis case partly settled in January have objected to the plaintiffs’ fee motion seeking up to 31.6 % of the common benefit fund. The brief, filed on behalf of the objectors by the Hamilton Lincoln Law Institute Center for Class Action Fairness (CCAF), asked the court to deny fee approval until certain billing records and fee sharing agreements are disclosed.
The filing explained that CCAF represents the objectors pro bono and will not seek attorneys’ fees for its work. The nonprofit reportedly has recovered more than $200 million dollars for class members by “persuading courts to reduce excessive fee requests or by driving settling parties to reach improved settlements.”
In the instant suit, the objectors argued that the plaintiffs’ fee motion includes “scant detail about the claimed common benefit work, does not even estimate what the common benefit fees might amount to, and provides absolutely no evidence that ceding 27% of claimants’ recovery to private attorneys for work sight unseen could possibly be fair to Flint residents who need this money to help them grapple with oft-debilitating, ruinous, and violent consequences of lead exposure for their entire lives.” The movants also pointed out that in such “megafund settlements” involving classes of wealthier shareholders or businesses, usual fee awards are in the 10%-12% range, less than half of what the attorneys here seek.
The objectors argued that before the court approves the requested fees, a lodestar cross-check is necessary. They further contended that the largely unsubstantiated current lodestar calculation, which reportedly includes “wildly inflated rates” from some firms, cannot form the basis of the fee award.
The movants also took issue with hours that the attorneys claim were worked for the common benefit of the class. They contended that hours may be misclassified and reported at “grossly inflated” rates. For this reason, the objectors noted that they will soon be moving to inspect the hourly billing records and expenses. Finally, the objectors contended that the plaintiffs have failed to demonstrate the reasonableness of their costs.
The objectors also criticized co-liaison counsel and co-lead class counsel for initially condemning the scant detail and undisclosed fee sharing, then “set(ting) aside their demands for rigor and scrutiny because they … jointly agreed to take more from claimants.” The objectors ultimately cautioned that the court must fulfill its role as fiduciary and protect the interests of absent class members and minors.
