Voth Oil Co. v. United States
108 Fed. Cl. 98
| Fed. Cl. | 2012Background
- Opt-in Rails-to-Trails takings class action in the District of Kansas involving 41 members across 48 parcels along a 15-mile corridor between Garden Plain and Wichita.
- Plaintiffs alleged the government took their property interests without just compensation by converting a rail corridor to a recreational trail under the National Trails System Act Amendments of 1988, 16 U.S.C. § 1247(d).
- Settlement provides 100% of fair market value plus prejudgment interest, totaling $1,259,527.47 in just compensation, with URA fees of $228,749 and costs of $54,481, for a total of $1,542,757.47.
- Attorneys’ fees under URA’s fee-shifting provision amount to $228,749, calculated by lodestar using reasonable hours and rates.
- Plaintiffs’ contingent fee agreements provide 40% of the net award to counsel, with a dollar-for-dollar credit for URA fees, creating a dispute about what counts in the net award.
- Preliminary approval was given October 18, 2012, a fairness hearing held December 10, 2012, with two comments and one objection regarding fee treatment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the settlement is fair, reasonable, and adequate under Rule 23(e). | Class counsel supported the settlement as fair and comprehensive. | Government supports the settlement as resolving all claims and providing full value. | The settlement is approved as fair, reasonable, and adequate. |
| Whether URA attorneys’ fees should be included in the base for the contingent fee calculation. | Contingent fee may include URA fees as part of the total recovery. | URA fees are statutory and should not be counted toward the contingent fee base. | URA fees are not included in the contingent fee base; 40% applies to just compensation plus interest, with a credit for URA fees. |
| Whether contingent fees may be approved alongside statutory URA fees. | Contingent fees are valid under Venegas and related authority despite statutory fees. | Contingent fees must be supervised but not precluded by statutory fees. | Contingent fee agreements are approved subject to excluding URA fees from the base. |
| Whether the lodestar-based URA fees are reasonable. | lodestar calculation reflects reasonable hours and rates. | Reasonableness supported by Supreme Court precedent; no adjustments necessary. | URA fees and costs are reasonable and approved. |
| Whether objections to fee treatment undermine the settlement. | Objector questioned fee allocation; overall settlement stands. | Objections do not negate the negotiated fee structure or settlement fairness. | Objections over fees did not defeat the settlement; approval granted. |
Key Cases Cited
- Venegas v. Mitchell, 495 U.S. 82 (1990) (contingent fees valid where statutorily awarded fees exist)
- Bywaters v. United States, 670 F.3d 1221 (Fed. Cir. 2012) (lodestar is the guiding standard for fee shifting)
- Moore v. United States, 63 Fed.Cl. 781 (2005) (contingent fees can be approved with statutory fees present)
- Jenkins v. McCoy, 882 F. Supp. 549 (S.D. W.Va. 1995) (court has inherent power to supervise contingent fees)
- Skaggs, 867 F.2d 527 (9th Cir. 1989) (contingent fees subject to reasonableness review)