Roadmap Provided in Citigroup Ins. Securities Class Action Settlement.
U.S. District Judge Sidney H. Stein, in In re Citigroup Ins. Sec. Litig., 87 Civ. 9901 (SHS) (S.D.N.Y. 8/1/13 Doc. 275), has provided a nice “roadmap” for deciding issues that frequently come up when district judges consider class action plantiffs’ attorneys’ fee requests.
Here is what District Judge Stein did:
1. He reduced the requested lodestar by these amounts: (a) $4 million for one plaintiffs’ firm unsuccessful efforts to become Lead Counsel; (b) $7.5 million for 16, 292 hours of attorney time spent pursuing discovery after the matter had settled; (c) $12 million by applying a reasonable blended rate of $200 per hour–not Lead Counsel’s suggestion of $466 per hour–for contract attorney work (with some of the contract attorneys only paid $15 per hour); and (d) 10% of the remaining balance for waste and inefficiency–examples: two attorneys respectively spent almost $67,000 and over $53,000 in fees digesting single day deposition transcripts (although the transcripts were different).
2. Taking a reduced lodestar totaling $24.1 million (keeping in mind plaintiffs’ attorneys’ requested $97 million), he enhanced it with a 2.8 multiplier given the “impressive recovery” to a total fee award of $70.8 million, which was 12% of the $590 million common fund.
3. He approved “blended” hourly rates of $402 for associates and $632 for partners.
4. He also approved an unopposed $2.8 million in expenses.
If you want to read District Judge Stein’s order, click here.