In The News . . . . N.D. Cal. District Judge Grants Reduced Lodestar Plus 2.59 Multiplier To Class Counsel In Bank of America Automated Call Settlement

 

$8 Million Percentage of Recovery Request Nixed; Reductions Made for Inefficient Work Efforts and High Settlement/Mediation Work Requests.

     In Rose v. Bank of America Corp., Case Nos. 5:11-CV-02390 & 5:12-CV-04009-EJD (N.D. Cal. Aug. 29, 2014) (Doc. No. 180), U.S. District Judge Edward J. Davila gave final approval to a settlement of a class action against Bank of America for alleged automated phone dialing system or prerecorded call violations without customers’ prior express consent under the Telephone Consumer Protection Act. He then had to assess plaintiffs’ request for fee compensation to class counsel.

     District Judge Davila did not give plaintiffs’ counsel all that they wanted.

     Plaintiffs’ counsel had around $1.4 million in lodestar time, comprising billing efforts by attorneys and paralegals at 10 firms. They asked for about $8 million in fees based on a 25% percentage of recovery approach, which would come to a 5.34 multiplier based on the $1.4 million lodestar or an 8.65 multiplier based on the reduced lodestar of $927,507.80 which the district judge ultimately found to be reasonable.

     District Judge Davila initially found that the hourly rates being claimed for Northern California legal work were reasonable: $100-$305 for paralegals; $325-525 for associates; and $350-775 for partners. His real “beef” was in compensating for some of the requested work, such as inefficient allocation of work by which higher billing attorneys did a bulk of the work and an excessive claim of 800 hours of mediation/settlement negotiation work. (He also questioned the need for litigation by 10 firms.) As indicated above, that brought the lodestar down to $927,507.80.

     The district court found that most class members might receive monetary payments between $20-40 and that the prospective relief was not that great given that the settlement allowed for ambiguity on the key “prior express consent” language—meaning banking customers still might get automated calls without their approval. He then surveyed multipliers in other cases, finding that 2.59 was an appropriate one, not the 5.34 or 8.65 requested by plaintiffs’ class counsel. So, in the end, $2,402,231.91 was the fee award (inclusive of costs).

     For those of you wanting to read his opinion, here is a link.