842 F. Supp. 2d 346
D. Me.2012Background
- MDL antitrust class action over broad vehicle-manufacturer litigation settled in part with Toyota and CADA for $37.3M total (as of Oct. 31, 2010).
- Settlement funds funded further litigation but most other defendants were dismissed or won summary judgment.
- Court certified settlement classes, approved two settlements, and approved a plan of allocation after fairness hearing in 2011.
- Class counsel sought $6.27M in expenses and $4.92M in fees (total $11.19M).
- Objectors challenged the fee request on (i) a claimed clear-sailing provision and (ii) overall size relative to class recovery; other objections addressed proposed allocations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the settlement’s clear-sailing provision affects fee award. | Luke argues provision improperly facilitates fee awarding. | Court notes it is not classic clear sailing and review remains rigorous. | Not dispositive; independent review conducted and still allowed. |
| Whether fees and expenses are reasonable in light of settlement. | Fees should be market-mimicking and justified by results. | Costs and fees reasonable given case complexity and risk. | Fees 13.2% of funds; expenses 6.27M; overall reasonable. |
| Whether Pentz/Luke should receive fees for modifying class scope. | Luke contributed to enlarging class coverage. | No fee agreement or time records; only Hawaii focus; limit reward. | Award $10,000 to Pentz; subtracted from class counsel’s fees. |
| Whether Frank’s cy pres objections affect fee award. | Objectors’ efforts should influence fees. | Cy pres rejected; avoid decreasing class recovery. | Cy pres rejected; Frank awarded $10,000 from separate pool; not offset from counsel fees. |
| What is the appropriate market-rate basis for the fee award? | Market-mimicking approach supports 30-40% range. | Various authorities support market-rate in this range. | Court adopts market-mimicking approach; concludes 30-40% reasonable; actual award 13.2% of settlement. |
Key Cases Cited
- Weinberger v. Great Nekoosa Corp., 925 F.2d 518 (1st Cir. 1991) (clear-sailing concept and review standards discussed)
- In re Synthroid Mktg. Litig., 264 F.3d 712 (7th Cir. 2001) (market-mimicking approach; private bargained fee guidance)
- In re Merry-Go-Round Enterprises, Inc., 244 B.R. 327 (D. Md. 2000) (market-rate consideration under complex/former bankruptcy context)
- Nilsen v. York County, 400 F. Supp. 2d 266 (D. Me. 2005) (multi-factor market-price analysis for contingent fees)