Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_04-cv-02147/USCOURTS-azd-2_04-cv-02147-8/pdf.json

Nature of Suit Code: 160
Nature of Suit: Stockholder's Suits
Cause of Action: 15:78m(a) Securities Exchange Act

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1 National Automatic Sprinkler Industry Pension Fund and Sprinkler Industry

Supplemental Pension Fund did not file a Reply in support of their Motion for Attorneys’

Fees.

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

In re Apollo Group Inc. Securities

Litigation, 

This Document Relates To: All Actions

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Master File No. CV 04-2147-PHX-JAT

CV 04-2204-PHX-JAT (Consolidated)

CV 04-2334-PHX-JAT (Consolidated)

CLASS ACTION

ORDER

Pending before the Court is Class members/Objector’s Motion for Objectors’

Attorneys’ Fees and Expenses. (Doc. 773). The Court now rules on the Motion.1

I. Background

On April 16, 2012, this Court held a hearing on Plaintiffs’ Motion for Approval of

Stipulation and Settlement Agreement. At that hearing, National Automatic Sprinkler

Industry Pension Fund and Sprinkler Industry Supplemental Pension Fund (collectively,

“NASI”) raised several objections to the proposed attorneys’ fees award for Class Counsel.

Thereafter, the Court approved the Stipulation and Settlement Agreement. The Court also

granted Class Counsel’s motion for attorneys’ fees and reduced the award by the amount of

taxable costs sought by Class Counsel. (Doc 770).

Case 2:04-cv-02147-JAT Document 784 Filed 10/02/12 Page 1 of 3
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NASI seeks an attorneys’ fee award of $33,081.02 based on NASI’s objections to the

attorneys’ fee award granted to Class Counsel. NASI asserts that their objections benefitted

the class as a whole and entitle them to recover the attorneys’ fees expended in making those

objections. 

II. Legal Standard

In a common fund case, objectors are entitled to an award of attorneys’ fees when

their objections have “substantially enhanced the benefit to the class under the settlement.”

Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1052 (9th Cir. 2002).

III. Discussion

A. Objections to Fees and the Method of Calculation

The two primary objections raised by NASI were (1) that the Court must apply the

lodestar method and not the percentage-of-the-fund method to the award of attorneys’ fees

to Class Counsel and (2) no fees should be awarded because Class Counsel did not provide

enough information for the Court to properly determine an appropriate amount of fees under

the lodestar method. (Doc. 770). Also, NASI requested a Special Master be appointed to

resolve the attorneys’ fees issue. Ultimately, although there was a reduction in the total

amount of costs awarded to Class Counsel, it was not a result of either objection raised by

NASI.

This Court found the application of a percentage-of-the-fund calculation to be

reasonable because “an exceptional result was achieved and it was extremely risky for Class

Counsel to pursue this case through seven years of litigation.”(Doc. 777). The Court also

undertook a lodestar cross-check to confirm the reasonableness of the award.

Despite NASI’s objections, the Court awarded reasonable attorneys’ fees to Class

Counsel under a percentage-of-the-fund calculation.

B. Objections to Expenses and Costs

NASI argues that, its objections caused the Court to reduce Class Counsel’s cost

recovery by 14%. NASI argues that, because the Court did not award Class Counsel its

taxable costs, such reduction in the amount requested must have been a result of NASI’s

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objections. (Doc 777).

In reviewing Class Counsel’s fee application, the Court was unable to determine the

authority for Class Counsel’s request for taxable costs. The Court determined that such

request was properly submitted to the Clerk of the Court in compliance with LRCiv 54.1.

Accordingly, the Court ordered Class Counsel to supplement their Petition for Attorneys’

Fees solely to request non-taxable costs. (Doc. 758). Upon the failure of Class Counsel to

comply with this order, the Court deducted possible taxable costs from the requested amount

of costs. This reduction was not predicated on any objection raised by NASI. (Doc. 750).

NASI also argues that, in addition to the monetary increase of 14% conferred on the

Class, NASI is entitled to attorneys’ fees because its objections turned the settlement hearing

into an adversarial proceeding. In response, Class Counsel argue that simply making an

objection without conferring a substantial benefit on the Class does not meet the standard for

awarding attorneys’ fees to objectors. Class Counsel further contend that such a result would

encourage objections for the sole purpose of objecting. The Court agrees.

IV. Conclusion

Accordingly, because there was no substantial benefit to the Class based on the

objections raised by NASI, NASI’s motion for attorneys’ fees is denied.

Based on the foregoing,

IT IS ORDERED that NASI’s petition for Attorneys’ Fees (Doc. 773) is denied.

DATED this 2nd day of October, 2012.

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