Reasonableness Of Fee Award Confirmed By Percentage Of Recovery Cross-Check, Where Ultimate Award Was Beyond 25% Benchmark.
Class counsel in a consumer protection class action, which was settled, sought an unopposed $350,000 fee recovery. The district judge, after setting the reasonable hourly rate, then applied a 25% reduction to the lower lodestar determination based on some block billing, excessive time spent on law conferences that did not advance the case or the interests of the class, unreasonable travel time billed without any showing that substantive work was performed, duplicative work, unsupported identical conclusory statements of class counsel as the only explanation for why the hours requested were reasonable, and puffery in describing work performed. The district judge ultimately awarded fees of $184,665 based on the lodestar approach, but also performed a cross-check using the percentage of recovery methodology. This cross-check showed that much more than the 25% benchmark was being awarded through the $184,665 fee order, but that class counsel rather than the defendants should receive any class action settlement monetary excess.
Plaintiff challenged that the district court did not adequately explain its award, but the Ninth Circuit disagreed in Johnson v. MGM Holdings, Inc., No. 18-35967 (9th Cir. Dec. 2, 2019) (published). No magic words are needed to explain a reduction, with the record in entirety showing an adequate explanation for the reduction. The Ninth Circuit also was pleased that the district judge cross-checked through the percentage of recovery method, again encouraging district judges to do so when they can.
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