The fee request is the highest of any data breach settlement, with fee awards approved in similar cases against Anthem and Yahoo totaling $31 million and $30 million, respectively. In those data breach cases, U.S. District Judge Lucy Koh of the Northern District of California questioned the amount of billing and the number of law firms involved. Those same problems exist in the Equifax settlement, Frank said.
Frank has also argued for sanctions against the law firms and an injunction barring them from securing attorneys fees without court approval. He said he can’t afford to intervene in each of the many dozens of cases that are resolved with mootness fees. “It’s not enough to have this whack-a-mole game that will not deter the behavior,” he told Law360.
Frank said in an email that the problem with Judge Rogers' previous ruling was not that the judge didn't explain her reasoning but that her reasoning "was just legally wrong." He said he's waiting to see what plaintiffs' lawyers from Lieff Cabraser Heimann & Bernstein – who defended the lithium ion settlements at the 9th Circuit – do next. "We're still evaluating our options," he said. "It would be odd to move for rehearing of a decision I just won. Then again, I've been known to be odd."
All three judges sitting on the panel expressed doubts about the settlements' approval. Aside from Judge Bybee’s comments, U.S. Circuit Judge M. Margaret McKeown said the judge’s order approving the settlements was “conclusory,” and Judge McKeown expressed concerns that Judge Gonzalez Rogers didn’t explain her reasoning for finding that the deals were fair.
With that kind of markup, Tigar said the use of contract lawyers could be considered a profit-seeking scheme. Heimann argued that the work and the overhead costs for staff and contract employees are the same in regard to training, supervision and providing workspaces. Tigar said the law firm wouldn’t contract out staff if it weren’t more profitable.
The decision is a victory for Ted Frank, the litigation director at the Hamilton Lincoln Law Institute and prominent critic of many class-action settlements. Frank said the money awarded to the privacy groups, under a legal doctrine known as “cy pres,” should have gone to class members like himself. He drew support from a bipartisan group of 13 state attorneys general led by Arizona’s Mark Brnovich.
Tigar also set out to address another objection mentioned in Frank’s opposition over a 5% fee allocated to 12 law firms who brought similar cases in Delaware courts. “The gravy train is so heavy that co-lead counsel has agreed to pay law firms that brought other cases even where they provided no common benefit, who represent plaintiffs who lack any colorable claims,” Frank wrote.
Ted Frank, an Akorn shareholder, moved to intervene and object to the fee. Judge Durkin ordered the parties to brief the issue whether he had “inherent authority” to abrogate the settlement in light of the Seventh Circuit’s ruling in the Walgreen case...
The decision is vindication for class action watchdog Ted Frank of the Hamilton Lincoln Law Institute. Frank, an Akorn shareholder, tried to intervene in the litigation in 2017, when plaintiffs’ lawyers disclosed their $322,500 mootness fee in a stipulation asking Judge Durkin to sign an order closing cases voluntarily dismissed by individual shareholders.
“The circuit split is still there,” Frank said. “They granted cert on it before and the Ninth Circuit is still signing off on some really appalling cy pres settlements.”
