COURT OF APPEALS

SECOND DISTRICT OF TEXAS

FORT WORTH

NO. 02-10-00483-CV

WILLIAM D. STRATTON APPELLANT

V.

XTO ENERGY INC., BOB R. 

SIMPSON, WILLIAM H. ADAMS III, 

LANE G. COLLINS, PHILLIP R. 

KEVIL, JACK P. RANDALL, SCOTT 

G. SHERMAN, HERBERT D. 

SIMONS, KEITH A. HUTTON, 

VAUGHN O. VENNERBERG II, 

LOUIS G. BALDWIN, TIMOTHY L. 

PETRUS, GARY D. SIMPSON, 

EXXON MOBIL CORPORATION, 

AND EXXON MOBIL INVESTMENT 

CORPORATION

APPELLEES

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FROM THE 352ND DISTRICT COURT OF TARRANT COUNTY

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MEMORANDUM OPINION1

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1See Tex. R. App. P. 47.4.
2

In this shareholder class action, appellant William D. Stratton, the lead 

plaintiff and representative of the class members (the Plaintiffs), appeals the trial 

court‘s order awarding $3,972,367.75 in attorneys‘ fees. We affirm the trial 

court‘s judgment as modified.

I. Background Facts

In late 2009, ExxonMobil Corporation (ExxonMobil) and XTO Energy, Inc. 

(XTO) announced that they had entered into an agreement that resulted in one of 

the largest mergers in U.S. history. Public shareholders of XTO filed a total of 

sixteen putative class actions in a Texas state court, a Delaware chancery court, 

and a Texas federal court. The Plaintiffs alleged that the XTO Board of Directors 

breached their fiduciary duty to the shareholders by, among other things, failing 

to make full and fair disclosures and failing to maximize shareholder value in the 

merger.

On April 21, 2010, after two months of intensive discovery, the parties 

agreed to a settlement. As part of the relief, ExxonMobil agreed, subject to court 

approval, to pay ―up to‖ $8,800,000 in attorneys‘ fees and expenses. In 

September 2010, with their motion for final certification of the settlement class 

and final approval of the settlement, Plaintiffs‘ counsel filed their application for 

attorneys‘ fees. Plaintiffs requested an award of $188,355.66 for expenses and a 

lodestar of $3,972,367.75 and a multiplier of 2.17, for an award of $8,611,644.34 

in attorneys‘ fees (a total award of $8,800,000). Counsel attached affidavits of all

twenty-one law firms attesting to the work done by each firm and the hours and 
3

rates of their attorneys, and the affidavit of William Kelly Puls, which detailed the 

history of the action, including the negotiations that lead to the settlement, the 

terms of the settlement, and the benefits to Plaintiffs. Because the request was 

within the range agreed upon in the settlement, the defendants did not object.

After a hearing in which no live witnesses or other additional evidence 

were presented, the trial court issued its final judgment granting Plaintiffs‘ request 

for $188,355.66 for expenses, but awarding only $3,972,367.75 of the requested 

$8,611,644.34 for attorneys‘ fees. The trial court issued a letter ―to clarify some 

of the reasons for the court‘s ruling.‖ In it, the trial court noted several problems 

with the evidence supporting the award. Specifically, the trial court noted a lack 

evidence that the hours worked and rates billed were reasonable. The trial court 

also expressed concern that some of the factors to be considered in granting a 

multiplier ―would not be appropriate across the board‖ because of the firms‘ 

differences in size, location, specialization, and degree of involvement with the 

case. The trial court concluded,

[D]espite the concerns set forth above regarding the sufficiency of 

the evidence and gaps in proof, the court accepted the billed 

amounts as the lodestar on the assumption that the Johnson factors 

have already been applied to justify the unusually high rates and 

declined to increase that amount by any multiplier.

Plaintiffs filed a motion to modify the judgment and to supplement the 

record. They attached twenty-one affidavits from Plaintiffs‘ counsel attesting to 

the reasonableness of their respective firms‘ rates; an affidavit from Professor 

Geoffrey P. Miller, an expert on attorneys‘ fees in class actions; and an affidavit 
4

from Professor Arthur R. Miller, a member of the Advisory Committee on Civil 

Rules of the Judicial Conference of the United States. At a hearing on the 

motion to modify, Plaintiffs presented live testimony by Professor Geoffrey Miller 

and Craig Enoch and submitted an exhibit comparing the rates of Plaintiffs‘ 

counsel with other firms in Texas and nationwide. The trial court took no action 

on Plaintiffs‘ motion and it was denied by operation of law. The trial court did not 

file findings of fact and conclusions of law. See Tex. R. Civ. P. 42(h)(3). 

Plaintiffs then filed this appeal.

II. Standard of Review

In Texas, the amount of an attorneys‘ fee award in a class action is at the 

sound discretion of the court, which determines what is reasonable under the 

circumstances. See Cnty. of Dallas v. Wiland, 124 S.W.3d 390, 403 (Tex. 

App.—Dallas 2003), rev’d and remanded on other grounds, 216 S.W.3d 344 

(Tex. 2007). To determine whether a trial court abused its discretion, we must 

decide whether the trial court acted without reference to any guiding rules or 

principles; in other words, we must decide whether the act was arbitrary or 

unreasonable. Low v. Henry, 221 S.W.3d 609, 614 (Tex. 2007); Cire v. 

Cummings, 134 S.W.3d 835, 838–39 (Tex. 2004). An appellate court cannot 

conclude that a trial court abused its discretion merely because the appellate 

court would have ruled differently in the same circumstances. E.I. du Pont de 

Nemours & Co. v. Robinson, 923 S.W.2d 549, 558 (Tex. 1995); see also Low, 

221 S.W.3d at 620. An abuse of discretion does not occur when the trial court 
5

bases its decisions on conflicting evidence and some evidence of substantive 

and probative character supports its decision. Unifund CCR Partners v. Villa, 

299 S.W.3d 92, 97 (Tex. 2009); Butnaru v. Ford Motor Co., 84 S.W.3d 198, 211 

(Tex. 2002).

III. Discussion

In their third issue, Plaintiffs complain that the trial court abused its 

discretion by failing to apply the lodestar enhancement factors in determining the 

reasonableness of their request for attorneys‘ fees.

Texas Rule of Civil Procedure 42(i)(1) states

In awarding attorney fees, the court must first determine a lodestar 

figure by multiplying the number of hours reasonably worked times a 

reasonable hourly rate. The attorney fees award must be in the 

range of 25% to 400% of the lodestar figure. In making these 

determinations, the court must consider the factors specified in Rule 

1.04(b), Tex. Disciplinary R. Prof. Conduct.

Tex. R. Civ. P. 42(i)(1). Those factors are:

(1) the time and labor required, the novelty and difficulty of the 

questions involved, and the skill requisite to perform the legal service 

properly;

(2) the likelihood, if apparent to the client, that the acceptance of the 

particular employment will preclude other employment by the lawyer;

(3) the fee customarily charged in the locality for similar legal 

services;

(4) the amount involved and the results obtained;

(5) the time limitations imposed by the client or by the 

circumstances;
6

(6) the nature and length of the professional relationship with the 

client;

(7) the experience, reputation, and ability of the lawyer or lawyers 

performing the services; and

(8) whether the fee is fixed or contingent on results obtained or 

uncertainty of collection before the legal services have been 

rendered.

Tex. Disciplinary Rules Prof‘l Conduct R. 1.04(b), reprinted in Tex. Gov‘t Code 

Ann., tit. 2, subtit. G, app. A, art. 10 § 9 (West Supp. 2011). The factors are very 

similar, but not identical, to the factors articulated in Johnson v. Georgia Highway 

Express, Inc., 488 F.2d 714, 717–19 (5th Cir. 1974).2

In its letter, the trial court expressed concern that ―many of the hourly rates 

charged seemed excessive on their face.‖ It stated that in order for the trial court 

to consider the high rates to be reasonable, ―Johnson factors would have to be 

applied to the rates themselves.‖ It then explained that its award of attorneys‘ 

fees was ―on the assumption that the Johnson factors have already been 

applied‖ to the lodestar.

 

2

The Johnson factors are: (1) the time and labor required for the litigation; 

(2) the novelty and difficulty of the questions presented; (3) the skill required to 

perform the legal services properly; (4) the preclusion of other employment by 

the attorney due to acceptance of the case; (5) the customary fee; (6) whether 

the fee is fixed or contingent; (7) time limitations imposed by the client or the 

circumstances; (8) the amount involved and the result obtained; (9) the 

experience, reputation and ability of the attorneys; (10) the ―undesirability‖ of the 

case; (11) the nature and length of the professional relationship with the client; 

and (12) awards in similar cases. Johnson, 488 F.2d at 717–19. Plaintiffs‘ 

counsel and the trial court refer to the Rule 1.04(b) factors and the Johnson

factors interchangeably. Because they are so similar, we will do the same and 

will rely on cases applying the Johnson factors.
7

Texas law is clear that the trial court is required to complete two distinct 

steps in awarding attorneys‘ fees. First, the court must calculate the lodestar by 

multiplying the number of hours reasonably worked by a reasonable hourly rate. 

Tex. R. Civ. P. 42(i)(1). Some Johnson factors may be used to determine the 

lodestar. Guity v. C.C.I. Enter., Co., 54 S.W.3d 526, 529 (Tex. App.—Houston 

[1st Dist.] 2001, no pet.) (citing Shipes v. Trinity Indus., 987 F.2d 311, 320 (5th 

Cir. 1993)). Second, the court must apply a multiplier between .25 and 4.0 based 

on any Johnson factors not already considered in the lodestar. Tex R. Civ. P. 

42(i)(1); see Dillard Dep’t Stores, Inc. v. Gonzales, 72 S.W.3d 398, 412 (Tex. 

App.—El Paso 2002, pet. denied) (―If some of [the Johnson] factors are 

accounted for in the lodestar amount, they should not be considered when 

making adjustments.‖).

Considering the record as a whole and the trial court‘s explanation in its 

letter, it appears that the trial court did not complete the required steps.3 

Particularly, in view of the clear, direct, and uncontradicted evidence presented in 

support of the motion to modify the judgment, Plaintiffs met their burden of 

showing an adjustment was needed to arrive at a reasonable fee. Instead of 

calculating the lodestar itself based on what it determined to be the reasonable 

 

3As the dissent points out, the trial court‘s letter states that it ―should not be 

considered an exhaustive or complete discussion of all considerations given to 

the Motion for Final Certification prior to the court‘s ruling thereon,‖ and it was not 

intended to be findings of facts and conclusions of law. It is, however, the only 

insight in the record into the court‘s reasons for its judgment and we consider it 

for what usefulness it provides.
8

amount of hours worked and a reasonable rate for those hours, and then 

determining whether the Johnson factors warranted an increase or a decrease of 

that amount, the trial court ―assumed‖ that the Johnson factors were accounted 

for in Plaintiffs‘ calculation. Although the letter does not make clear what value 

the trial court placed on each Johnson factor, it is clear, after considering the 

letter in conjunction with the complete record, that the trial court ignored the 

uncontroverted evidence that (1) the suggested lodestar was calculated without 

enhancement by the Johnson factors and (2) that an enhancement was 

warranted by the facts of the case. The trial court‘s assumption was not based 

on the evidence presented, was without reference to the guiding rules and 

principles, and resulted in an award that cannot be said to be just.4 Because the 

trial court did not follow the steps as articulated in rule 42(i)(1), it abused its 

discretion by failing to calculate an appropriate lodestar and adjusting it as 

warranted. See Forbush v. J.C. Penney Co., 98 F.3d 817, 823 (5th Cir. 1996) 

(holding that it would not reverse the decision of a court that fails to discuss a 

Johnson factor ―so long as the record clearly indicates that the district court has 

utilized the Johnson framework as the basis of its analysis, has not proceeded in 

a summary fashion, and has arrived at an amount that can be said to be just 

 

4Plaintiffs‘ fourth issue challenges the award as failing to consider the 

undisputed evidence that the requested amount was reasonable. As we stated 

above, we agree that the trial court ignored the uncontroverted evidence on the 

reasonableness of the requested award. Thus, we could alternatively reverse 

the award on the grounds asserted in Plaintiffs‘ fourth issue.
9

compensation‖) (quoting Cobb v. Miller, 818 F.2d 1227, 1232 (5th Cir. 1987)); 

Copper Liquor, Inc. v. Adolph Coors Co., 624 F.2d 575, 584 (5th Cir. 1980)

(noting that ―we should go slow in finding that‖ a trial judge abused his discretion 

but holding that ―the district court abused its discretion by failing to attach 

appropriate significance to the Johnson criteria most pertinent to reasonable 

attorneys‘ fees and by neglecting to develop fully the reasons for his award‖).

The dissent would have us remand the case for further proceedings. In 

this case, however, we do not think remand is necessary. See Tex. R. App. P. 

43.3 (―When reversing a trial court‘s judgment, the court must render the 

judgment that the trial court should have rendered, except when: (a) a remand is 

necessary for further proceedings . . . .‖). The record before us contains all of the 

affidavits and records submitted in support of the request for attorneys‘ fees, and 

the testimony presented was not contradicted by any other witness or attendant 

circumstances but instead was clear, positive, and free from circumstances 

tending to cast suspicion thereon. In the interest of judicial economy and our 

duty to render judgment unless remand is necessary, we review the evidence 

and render the appropriate judgment. See id.; Ragsdale v. Progressive Voters 

League, 801 S.W.2d 880, 882 (Tex. 1990) (rendering a judgment on attorneys‘

fees ―[i]n the interest of judicial economy‖); see also Louisiana Power & Light Co. 

v. Kelstrom, 50 F.3d 319, 325–26 (5th Cir. 1995) (choosing to exercise its option 

to modify an award of attorneys‘ fees ―[b]ecause the record contains sufficient 

information to allow a fair determination of a reasonable fee‖); Sidag 
10

Aktiengesellschaft v. Smoked Foods Prods. Co., 960 F.2d 564, 566–67 (5th Cir. 

1992) (rendering instead of remanding when sufficient evidence existed in the 

record because ―no useful purpose would be served by further delaying [the 

case‘s] final disposition, not to mention exposing the parties and this court to yet 

[another] appeal‖).

A. Calculating the lodestar

The lodestar is calculated by multiplying the number of hours reasonably 

spent by counsel on the matter by a reasonable hourly rate. Dillard Dep’t Stores, 

72 S.W.3d at 412; Guity, 54 S.W.3d at 528–29. Plaintiffs submitted roughly 

7,370 hours at various rates from $200 to $845 per hour for a lodestar of 

$3,972,367.75. We will review the evidence supporting both the number of hours 

and the hourly rates requested.

1. Hours

With their application for attorneys‘ fees, Plaintiffs‘ counsel presented no 

evidence in the twenty-one attached affidavits by the attorneys that their hours or 

their rates were reasonable. With their motion to modify, Plaintiffs submitted 

twenty more affidavits from the attorneys.5 In all but five of those affidavits, the 

attorneys testified that the hours spent by their firm on the case were reasonable 

 

5One firm that had submitted an affidavit with the application did not submit 

a second affidavit with the motion to modify.
11

and necessary.6 All of the firms detailed in their affidavits the tasks that the 

attorneys accomplished, such as researching, drafting, and filing; reviewing 

documents; responding to discovery requests; conducting depositions; and 

negotiating the settlement.

Plaintiffs also submitted the affidavits of expert witness Geoffrey P. Miller.7 

Miller and Craig Enoch also testified at trial. In his affidavit, Miller opined that 

based on his review of the hours billed by the attorneys, ―[t]he hours spent 

appear reasonable for the tasks accomplished.‖ He further stated, ―Considering

the huge amount of work done as described in the submissions in support of the 

fee application, this time is, in my experience, consistent with the time needed to 

properly litigate a case of this type and magnitude.‖ He noted that ―expertise of 

the Plaintiffs‘ firms contributed to efficiency and reduced hours‖ and that,

Where practical and appropriate, work appears to have been 

performed by associates, paralegals[,] and law clerks. By far, the 

overwhelming bulk of the work was done by attorneys with the 

appropriate, but not excessive, seniority to handle level-appropriate 

aspects of the Actions. In sum, based on my review of the affidavits 

of counsel submitted with the Final Approval Motion and wit[h] this 

Motion, my analysis indicates that Plaintiffs‘ counsel put in the time 

necessary to achieve a successful result but did so in an efficient 

manner.

 

6Of the 7,369.9 hours submitted, the number of hours without direct 

testimony supporting their reasonableness and necessity equaled 386.35, or 

5.2% of the total hours submitted.

7Plaintiffs also submitted the affidavit of expert witness Arthur R. Miller. 

Arthur Miller, however, did not state an opinion specifically as to the 

reasonableness or necessity of the hours billed.
12

At trial, Miller testified again that the hours billed were reasonable in light of the 

―extraordinary intensity of the litigation.‖ Enoch also testified at trial that the 

hours billed were reasonable.

Plaintiffs provided evidence, by way of expert testimony, that the hours 

billed were reasonable and necessary. And although neither Miller nor Enoch 

reviewed line by line each task billed, Texas courts have repeatedly held that an 

itemized bill is not necessary to support an award of attorneys‘ fees. La Ventana 

Ranch Owners’ Ass’n v. Davis, No. 03-09-00452-CV, --- S.W.3d ---, 2011 WL 

2162886, at *16 (Tex. App.—Austin June 3, 2011, no pet.) (holding that the 

evidence was factually sufficient to establish the reasonableness of the time 

spent ―[e]ven without an itemized billing statement or testimony regarding the 

reasonableness and necessity of the amount of time spent on each particular 

task‖ when the attorney and an expert witness testified that the amount was 

reasonable and the attorney listed the various tasks he accomplished); Burnside 

Air Conditioning & Heating, Inc. v. T.S. Young Corp., 113 S.W.3d 889, 898 (Tex. 

App.—Dallas 2003, no pet.) (upholding fee award absent any itemized billing 

statement based solely on attorney‘s testimony regarding his customary hourly 

rate, total hours spent on the case, his experience and expertise, and complexity 

of the case). There is thus sufficient evidence before us to determine that the 

number of hours billed were reasonable.

Plaintiffs stated in their application for attorneys‘ fees that the total amount 

of hours equaled 7,369.55. However, in adding up the hours listed in the 
13

affidavits, we arrived at 7,369.9 total hours submitted. In examining the amounts 

submitted, we discovered two additional errors. First, one attorney at Baron & 

Budd, P.C. submitted 47.25 hours at a rate of $700 per hour (a total of $33,075 in 

fees), but requested only $23,100, which would be the correct fee for 33 hours of 

work. Second, an attorney at Grant & Eishenhofer, P.A. submitted 592.8 hours 

at $295 per hour (a total of $174,876 in fees) but requested only $174,787.50, 

which would be the correct fee for 592.5 hours of work. Because it is unclear 

that the higher number of hours for the two attorneys is appropriate, we hold 

there is support for 7,355.3 hours of work reasonably expended. See Stewart 

Title Guar. Co. v. Sterling, 822 S.W.2d 1, 10 (Tex. 1991) (noting that as a general 

rule, a party seeking to recover attorney‘s fees carries the burden of proof to 

establish that it is entitled to them).

2. Rates

All twenty-one of the attorneys‘ affidavits attached to the original 

application for attorneys‘ fees stated merely that the rates requested were the 

firms‘ ―regular rates that [the] firm[s] charge[] both hourly clients and contingent 

clients alike for [their] services.‖8In the twenty affidavits submitted with their 

motion to modify, all but six attorneys testified that the rates charged by their firm 

 

8All of the affidavits in which a firm requested expenses also contained the 

same language that their expenses were ―reasonable under the circumstances 

and were necessary to achieve the settlement reached in this case.‖ The trial 

judge awarded all of the requested $188,355.66 in expenses. The Plaintiffs do 

not contest that part of the award.
14

were reasonable in comparison with the rates charged for similar work in their 

communities. Although the customary fees charged in the local legal community 

for similar legal services is helpful in determining the reasonableness of the fees 

requested, it is not fatal to an attorney‘s application for fees if it is not included. 

See In re A.B.P., 291 S.W.3d 91, 98 (Tex. App.—Dallas 2009, no pet.) (noting 

that a trial court is not required to receive evidence of each of the factors that 

should be considered in determining the reasonableness of an award of 

attorneys‘ fees); Burnside Air Conditioning & Heating, 113 S.W.3d at 897–98 

(same). All of the rates charged by those six firms fall within the range of hourly 

rates charged by other attorneys in this case with similar experience. Four firms 

also noted that their rates have been approved by other Texas courts. One 

affiant attached The National Law Journal‘s survey of firm billing rates for 2007, 

2008, and 2009, which showed that all of the rates requested were within the 

range of rates billed by other firms in their state. Further, in their motion for 

reconsideration, Plaintiffs cite a number of cases demonstrating that the high 

rates for the New York law firms were not out of line with the customary rates of 

the area. See In re Comverse Tech. Secs. Litig., No. 06-CV-1825(NGG)(RER),

2010 WL 2653354, at *4 (E.D.N.Y. Jun. 24, 2010) (noting hourly rates from $125 

to $880); In re Marsh ERISA Litig., 265 F.R.D. 128, 146 (S.D.N.Y. 2010) (hourly 

rates of $125 to $775); In re Telik, Inc. Secs. Litig., 576 F. Supp. 2d 570, 589–90 

(S.D.N.Y. 2008) (hourly rates of $300 to $750); In re Gilat Satellite Networks, 

Ltd., No. CV-02-1510(CPS)(SMG), 2007 WL 2743675, at *17 (E.D.N.Y. Sept. 18, 
15

2007) (hourly rates of $325 to $725); In re Merrill Lynch & Co. Research Reports 

Secs. Litig., No. 02-MDL-1484(JFK), 2007 WL 313474, at *22 (S.D.N.Y. Feb. 1, 

2007) (hourly rates of $515 to $850).

Enoch testified at the hearing that the rates charged by the attorneys in 

this case were ―eminently reasonable‖ based on ―the quality of the lawyers that 

are in this representation here and my familiarity with the fees that are generally 

charged for this type of complex litigation.‖ He testified that he saw no ―bonus or 

premium embedded‖ in the rates charged by the attorneys. Geoffrey Miller 

opined in his affidavit that ―the rates charged by Plaintiffs‘ counsel in the three 

actions are commensurate with the rates prevailing in their respective 

communities for attorneys who practice in the same areas in which these 

attorneys specialize or concentrate.‖ Miller noted that the average hourly rate 

requested in this case was $539 per hour for all attorneys and compared that to a 

study that ―found that the average hourly rate based on attorneys‘ fees awarded 

in 277 securities cases settled from 1973 to 2003 was $1,370 in 2003 dollars.‖ 

We therefore hold that the rates submitted by the attorneys in this case are 

reasonable.
16

3. Lodestar

As discussed above, we hold that a reasonable number of hours expended 

in this litigation is 7,355.3. Multiplying the hours by the respective rates 

submitted by the attorneys results in a lodestar of $3,968,277.25.9

B. Applying a multiplier

Once the lodestar is calculated, rule 42(i)(1) requires the court to award an 

amount ―in the range of 25% to 400% of the lodestar figure.‖ Tex. R. Civ. P.

42(i)(1). Plaintiffs requested an award of 217% of the lodestar. In determining 

whether this is a reasonable award, the court is required to consider the factors 

listed in Texas Disciplinary Rule of Professional Conduct 1.04(b). Id.

1. The time and labor required, the novelty and difficulty of the 

questions involved, and the skill requisite to perform the legal 

service properly

Enoch testified at the hearing on Plaintiffs‘ motion to modify that he 

believed a multiplier should be used in this case because the ―intensity of the 

issue‖ called for a lot of time and labor. Geoffrey Miller testified that the ―Actions

involved a plethora of difficult, unsettled, and novel issues of law.‖ He opined, 

―[T]here can be no question that the magnitude, complexity and novelty of the 

issues presented in this litigation favor a substantial risk multiplier.‖ Miller also 

 

9

The attorney at The Briscoe Law Firm, PLLC submitted 45.25 hours at 

$525 (a total of $23,756.25 in fees) but requested $27,756.25 in fees. We see 

no justification for the additional $4,000. See Stewart Title Guar. Co., 822 

S.W.2d at 10.
17

testified to the added risks of a class action such as getting class certification. 

From his research he concluded that

Multipliers in securities actions tend to be higher than multipliers in 

statutory fee-shifting or other types of less complex or costly class 

actions. This fact reflects reality that cases pursued on a class basis 

are among the most difficult to litigate, require a high degree of 

sophistication, are defended invariably by capable and sophisticated 

law firms, and involve risks in terms of dedication of resources, 

expenditure of time and potential for non-payment.

2. The likelihood, if apparent to the client, that the acceptance of the 

particular employment will preclude other employment by the 

lawyer

Enoch described this type of fast-paced litigation as ―all-hands-on-deck‖ 

and noted that the document-intensive discovery and short deadlines means that 

―when someone is asking you to do this[,] they recognize they‘re calling on all 

your people to be available on this one item or this one project.‖

3. The fee customarily charged in the locality for similar legal 

services

As noted above, the hourly rates charged by the attorneys in this case are 

within the range of rates charged by other attorneys in their respective localities. 

We do note that the rates charged in some of the larger markets, such as New 

York, are higher than those charged in Tarrant County.

4. The amount involved and the results obtained

In his affidavit, expert witness Arthur Miller testified that that the results that 

Plaintiffs‘ counsel obtained were excellent. He believed that the supplemental 

disclosures that resulted from the litigation provided vital information to the 
18

Plaintiffs and supported the requested attorneys‘ fee award. He noted that 

discovery in this case revealed that the defendant companies had not provided 

the financial advisor who was responsible for valuing XTO and opining on the 

fairness of the merger with all the necessary documents to make a fully-informed 

opinion, and he detailed the value of the information gleaned from the litigation in 

his fifteen-page affidavit. Miller also noted that in his research he found only one 

other instance of plaintiffs‘ counsel ―achieving a similar type and level of 

disclosure.‖ That case was a New York case concerning a $9 billion merger and 

the attorneys‘ fee award was $8.5 million. The merger that formed the basis of 

this litigation was valued at $41 billion—as Geoffrey Miller described it, ―one of 

the most important mergers in American history.‖ Enoch testified, ―The results 

being sought [were] to assure full, accurate information. It seemed to me that 

was a very good result here, and that‘s a positive.‖ Enoch testified that the value 

of the disclosures was significant and went on,

But it seems to me there was even greater benefit here, where the 

specialist, the financial advisers that were advising on the deal, were 

directed to consider further information and then report on that. It 

seems to me it says—it‘s greatly valuable to have the

confirmation. . . . So it seemed to me this was tremendously 

beneficial in the concept of what this is all about, which is to make 

sure the voters are informed at the time they‘re casting their vote.

In William Kelly Puls‘s affidavit attached to the application for attorneys‘ 

fees, he noted that ―overwhelmingly positive reaction of the Class members to 

date further illustrates the excellence of the Settlement.‖ Plaintiffs‘ counsel 
19

estimated the percentage of class members who objected to the settlement to be 

roughly .002 percent.

5. The time limitations imposed by the client or by the circumstances

Because Plaintiffs filed for a temporary injunction to halt an upcoming vote 

by the XTO shareholders on the merger, the parties to this case agreed on an 

expedited discovery schedule. In the roughly four months of discovery, Plaintiffs‘ 

attorneys reviewed hundreds of thousands of pages of public filings, financial

analyst reports, business media articles, and about 65,000 pages of confidential 

documents. At the hearing, Enoch testified that this kind of intensive document 

review is stressful and time consuming. He described cases with a short 

deadline and complex issues as ―all-hands-on-deck and it‘s full speed ahead for 

a very short period of time.‖ Geoffrey Miller opined that highly compressed 

timelines ―strongly favor[] a substantial lodestar enhancement.‖

6. The nature and length of the professional relationship with the 

client

This was a contingency fee case in which Plaintiffs‘ attorneys represented 

a large class of shareholders who held approximately 584 million shares of XTO 

stock. 179,618 copies of notice of the suit were mailed to potential class 

members. As Geoffrey Miller opined,

Unlike hourly billing attorneys, there was little likelihood that 

Plaintiffs‘ counsel would be retained on an hourly basis by members 

of the plaintiff class based on their representation of the class in a 

class action. Thus the concept of undertaking a potentially less 

economically beneficial retention as a ―loss leader‖ plays no role in 

cases such as this.
20

7. The experience, reputation, and ability of the lawyer or lawyers 

performing the services

With ninety different attorneys performing work on this case, the amount of 

experience and ability will naturally vary. Some of the senior partners had thirty 

or forty years of experience. There were also young associates with little 

experience. Overall, there were many firms with good reputations and national 

practices. Enoch testified that this factor ―gets a lot of weight from me. . . . 

You‘re talking about pretty significant litigation. . . . [I]t‘s a significant transaction.

. . . [T]he quality of the lawyer in here is a critical piece of it, and that should get 

a positive.‖ Geoffrey Miller testified that the favorable settlement ―evidences the 

superior quality of their work.‖

8. Whether the fee is fixed or contingent on results obtained or 

uncertainty of collection before the legal services have been 

rendered

Geoffrey Miller stated in his affidavit, ―The contingent nature of the fee 

arrangement is, without doubt, the most important factor in a lodestar/multiplier 

analysis.‖ All of the firms‘ fees were on a fully contingent basis. Enoch noted, 

―[T]here is a recognition of an additional value for the services performed in 

exchange for running the risk that there [will] be no recovery at all.‖ Increasing 

the lodestar for contingent work, he said, is ―about trying to attract quality lawyers 

to work in this field and assure that their risk is carefully accounted for.‖ He 

testified, ―[T]he straight lodestar does not take into account the risk, the 

evaluation of the . . . economic value of the lawyer taking on the risk of not being 
21

paid at all.‖ All of the attorneys testified that the hourly rates they submitted were 

the ―regular rates that [the] firm[s] charge[] both hourly clients and contingent 

clients alike.‖ See El Apple I, Ltd. v. Olivas, 324 S.W.3d 181, 193–94 (Tex. 

App.—El Paso 2010, pet. granted) (upholding the application of a multiplier 

based in part on the contingent nature of the fee ―[b]ecause there is no indication 

the trial court considered the contingency factor more than once in its calculation‖ 

when the attorneys testified that they did not adjust their hourly fee because of 

the contingent nature of the case). We also note that Texas courts consistently 

allow the use of a multiplier based upon the contingent nature of a fee under 

Texas statutes allowing recovery of attorney‘s fees. Toshiba Mach. Co., Am. v. 

SPM Flow Control, Inc., 180 S.W.3d 761, 783 (Tex. App.—Fort Worth 2005, pet. 

granted, judgm‘t vacated w.r.m.); Dillard Dept Stores, 72 S.W.3d at 412; Guity,

54 S.W.3d at 529; Borg-Warner Protective Servs. v. Flores, 955 S.W.2d 861, 870 

(Tex. App.—Corpus Christi 1997, no pet.); Crouch v. Tenneco, 853 S.W.2d 643, 

648 (Tex. App.—Waco 1993, writ denied).

Miller also opined that ―Plaintiffs‘ counsel was entitled to a substantial risk 

multiplier for their efforts in the Actions‖ and that the requested multiplier ―is both 

fair and reasonable under the law of Texas and under the circumstances of the 

Actions.‖ In his opinion, a multiplier of 2.17 is ―eminently fair based on how the 

courts generally handle cases of this type‖ and that even a multiplier ―at or near 

the upper limit . . . would not have been unreasonable.‖ A multiplier of 2.17 is not 

unusual in large, complex, and expedited cases. See Dillard Dep’t Stores, 72 
22

S.W.3d at 413 (upholding a multiplier of 2 based on the novelty and difficulty of 

the issues, the contingent nature of the fee, the time limitations imposed by the 

circumstances, and the preclusion of other employment); Flores, 955 S.W.2d at 

870 (upholding use of a 1.5 multiplier when plaintiff prevailed on all issues and 

―was required to pierce numerous layers of corporate bureaucracy in order to 

bring her case to trial‖).

The trial court ordered attorneys‘ fees paid in the amount of the 

unenhanced lodestar based on the assumption that the Johnson factors were 

applied in justifying the hourly rates requested. The unenhanced lodestar does 

not reflect the exceptional results achieved by Plaintiffs‘ counsel, the 

undesirability of this litigation, the high risk borne by its contingent nature, or the 

fact that the fee award requested is comparable to that awarded in similar class 

action litigation, all of which were directly established by uncontradicted 

evidence. The court was obligated to consider the adjustment based on that 

evidence and the Johnson factors, and it was an abuse of discretion to fail to do 

so based on an unsubstantiated assumption. We hold that the requested 

multiplier of 2.17 is appropriate in this case. The lodestar of $3,968,277.25 

multiplied by 2.17 equals an award of $8,611,161.63, which we hold to be an 

appropriate and reasonable award.

Because we sustain Plaintiffs‘ third issue and because we have 

determined an appropriate award of attorneys‘ fees, we need not reach the rest 

of Plaintiffs‘ issues. See Tex. R. App. P. 47.1.
23

Conclusion

Having sustained Plaintiffs‘ third issue and holding that we do not need to 

reach their other issues, we modify the trial court‘s award of attorneys‘ fees to be 

$8,611,161.63 and affirm the trial court‘s judgment as modified.

LEE GABRIEL

JUSTICE

PANEL: WALKER, MEIER, and GABRIEL, JJ.

MEIER, J., filed a dissenting opinion.

DELIVERED: February 9, 2012
COURT OF APPEALS

SECOND DISTRICT OF TEXAS

FORT WORTH

NO. 02-10-00483-CV

WILLIAM D. STRATTON APPELLANT

V.

XTO ENERGY INC., BOB R. 

SIMPSON, WILLIAM H. ADAMS III, 

LANE G. COLLINS, PHILLIP R. 

KEVIL, JACK P. RANDALL, SCOTT 

G. SHERMAN, HERBERT D. 

SIMONS, KEITH A. HUTTON, 

VAUGHN O. VENNERBERG II, 

LOUIS G. BALDWIN, TIMOTHY L. 

PETRUS, GARY D. SIMPSON, 

EXXON MOBIL CORPORATION, 

AND EXXON MOBIL INVESTMENT 

CORPORATION

APPELLEES

----------

FROM THE 352ND DISTRICT COURT OF TARRANT COUNTY

----------

DISSENTING MEMORANDUM OPINION1

----------

 

1See Tex. R. App. P. 47.4.
2

The lynchpin of the majority opinion states ―it appears that the trial court 

did not complete the required steps.‖ Because I would treat the October 8, 2010 

letter as nothing more than what the trial court stated in the opening paragraph of 

the letter—―This letter attempts to clarify some of the reasons for the court‘s 

ruling, but it should not be considered an exhaustive or complete discussion of all 

considerations given to the Motion for Final Certification prior to the court‘s ruling 

thereon.‖—I do not read the letter to support an appellate ruling that ―the trial 

court did not complete the required steps.‖ To the extent that we permit the trial 

court‘s letter to function as rule of civil procedure 42(h)(3) findings of fact and 

conclusions of law, reviewing the letter in its entirety—instead of considering one 

short phrase contained within the letter in isolation—reveals that the trial court 

declined to adjust the presumptively reasonable lodestar because it had already 

accounted for relevant Johnson factors in determining the lodestar. For these 

reasons, I dissent.

Our rules of civil procedure contain detailed requirements for class action 

lawsuits, including procedures for determining an award of attorneys‘ fees. See

Tex. R. Civ. P. 42(h). After a motion for attorneys‘ fees and a hearing, ―[t]he 

[trial] court must state its findings and conclusions in writing or orally on the 

record.‖ Tex. R. Civ. P. 42(h)(3) (emphasis added). Rule 42 ―is patterned after 

Federal Rule of Civil Procedure 23; consequently, federal decisions and 

authorities interpreting current federal class action requirements are persuasive 

authority.‖ Sw. Ref. Co. v. Bernal, 22 S.W.3d 425, 433 (Tex. 2000). Federal rule 
3

of civil procedure 23(h)(3) provides that the trial court may hold a hearing on 

attorneys‘ fees in a class action suit but, similar to our rules, ―must find the facts 

and state its legal conclusions under Rule 52(a).‖ Fed. R. Civ. P. 23(h)(3). The 

Fifth Circuit requires that ―[w]hen a district court awards attorneys‘ fees it must 

explain how each of the Johnson factors affects its award.‖ See In re High Sulfur 

Content Gasoline Prods. Liab. Litig., 517 F.3d 220, 228 (5th Cir. 2008). ―[T]he 

district court‘s findings and reasons must be  ̳complete enough to assume a 

review which can determine whether the court has used proper factual criteria in 

exercising its discretion to fix just compensation.‘‖ Id. at 229 (citing Brantley v. 

Surles, 804 F.2d 321, 325–26 (5th Cir. 1986)).

The trial court‘s October 8, 2010 letter specifically warns at the outset that 

it ―attempts to clarify some of the reasons for the court‘s ruling, but it should not 

be considered an exhaustive or complete discussion of all considerations given 

to the Motion for Final Certification prior to the court‘s ruling thereon.‖ Thus, on 

its face, the letter purports to acknowledge its own inherent incompleteness.2 

The trial court did not explain how each of the Johnson factors affected its award, 

and we are left to speculate as to the findings that are not contained in the letter. 

As an appellate court reviewing an award of attorneys‘ fees in a complex class 

action suit involving ―one of the largest mergers in U.S. history,‖ we should not 

follow the analysis advocated by Stratton in his third issue and rely upon the 

 

2

The majority even seems to acknowledge this.
4

incomplete letter as a substitute for rule 42(h)(3) findings and conclusions. This 

is because, unless the trial court provides a reasonably specific explanation of 

the fee determination, ―adequate appellate review is not feasible, and without 

such review, widely disparate awards may be made, and awards may be 

influenced . . . by a judge‘s subjective opinion regarding particular attorneys or 

the importance of the case.‖ See Perdue v. Kenny A. ex rel. Winn, 130 S. Ct. 

1662, 1676 (2010). The trial court‘s letter meets neither the Supreme Court‘s nor 

the Fifth Circuit‘s standards for explaining an award of attorneys‘ fees. 

Accordingly, I would either abate this appeal and remand the case to the trial 

court for entry of findings and conclusions as required by rule 42(h)(3) or reverse 

the trial court‘s judgment as to attorneys‘ fees and remand the case for further 

proceedings.

To the extent that we construe the October 8, 2010 letter as sufficiently 

identifying the trial court‘s findings and conclusions and proceed to address 

Stratton‘s third issue, the trial court did not abuse its discretion by awarding 

attorneys‘ fees in the amount of $3,972,367.75. The lodestar creates a 

presumptively reasonable fee. Id. at 1673. ―While the lodestar is relevant to 

determining a fee award, it is not the sole basis for determining that award; the 

Johnson factors are applicable to deciding whether the lodestar is reasonable, as 

well as to adjusting that award by a multiplier once the lodestar is calculated.‖ 

In re Enron Corp. Sec., Derivative & ERISA Litig., 586 F. Supp. 2d 732, 755 (S.D. 

Tex. 2008); see Hensley v. Eckerhart, 461 U.S. 424, 434 n.9, 103 S. Ct. 1933, 
5

1940 n.9 (1983) (―The district court also may consider other factors identified in 

[Johnson] though it should note that many of these factors usually are subsumed 

within the initial calculation of hours reasonably expended at a reasonable hourly 

rate.‖). Indeed, four of the Johnson factors are presumably included in the 

lodestar calculation (the novelty and complexity of the issues, the special skill 

and experience of counsel, the quality of representation, and the results obtained 

from the litigation), and the Fifth Circuit has reasoned that two other factors are 

generally subsumed in the lodestar (the time limitations and the circumstances 

and preclusion of other employment). See Enron Corp., 586 F. Supp. 2d at 756–

57 (citing Shipes v. Trinity Indus., 987 F.2d 311, 321–22 (5th Cir.), cert. denied, 

510 U.S. 991 (1993)); see also Perdue, 130 S. Ct. at 1673 (reasoning that the 

―lodestar includes most, if not all, of the relevant factors constituting a 

 ̳reasonable‘ attorney‘s fee‖). The time and labor involved and the customary fee 

may also be considered in calculating the lodestar. See, e.g., Nassar v. Univ. of 

Tex. Sw. Med. Ctr., No. 3:08-CV-1337-B, 2010 WL 3000877, at *6 (N.D. Tex. 

July 27, 2010) (mem. op.). But while these factors may be considered in 

calculating the lodestar, it is well established that the lodestar may not be 

adjusted in consideration of a Johnson factor if that factor was already accounted 

for in arriving at the lodestar; ―to do so would be impermissible double counting.‖3 

 

3An upward adjustment of the lodestar based on factors that are 

presumably included in the lodestar amount is still permissible, but ―such 

modifications are proper only in certain rare and exceptional cases supported by 
6

Saizan v. Delta Concrete Prods. Co., 448 F.3d 795, 800 (5th Cir. 2006); see 

Perdue, 130 S. Ct. at 1673 (recognizing that the Court has ―held that an 

enhancement may not be awarded based on a factor that is subsumed in the 

lodestar calculation‖).

The trial court concluded its letter by stating that it had ―accepted the billed 

amounts as the lodestar on the assumption that the Johnson factors have 

already been applied.‖ From this snippet, the majority concludes that ―it appears 

that the trial court did not complete the required steps‖ because the trial court 

― ̳assumed‘ that the Johnson factors were accounted for in Plaintiffs‘ 

calculations.‖ Maj. Op. at 7. This is a misconstruction of the letter and of the trial 

court‘s attorneys‘ fees award. The mistake made by the majority is that it 

construes the letter‘s final sentence in isolation and apart from the remainder of 

the letter, which unambiguously indicates that the trial court had numerous 

concerns about the reasonableness of both the rates charged and the hours 

expended by the plaintiffs‘ attorneys. After explaining some of its concerns about 

the rates and hours, the trial court stated,

Texas law seems clear that when Johnson factors are already 

accounted for in determining the reasonable rates (the lodestar 

amount), they should not again be considered when making 

adjustments. To rely on Johnson factors both to justify high rates 

and to justify the application of a multiplier would result in a 

duplicative award of fees.

 

both specific evidence on the record and detailed findings by the lower courts.‖ 

Shipes, 987 F.2d at 320.
7

At the request of Stratton, the trial court conducted an exhaustive hearing on 

December 17, 2010, and thereafter declined to modify the original Order and 

Final Judgment.

Considering the letter as a whole, the trial court did not decline to adjust 

the lodestar because it merely ―assumed‖ that the Johnson factors had already 

been accounted for in the lodestar; rather, it did take into account certain 

Johnson factors—and possibly all of the Johnson factors—in arriving at the 

presumptively reasonable lodestar and then either (1) refused to double count 

those same factors in considering a multiplier or (2) considered certain Johnson

factors not addressed in calculating the lodestar as irrelevant for purposes of the 

multiplier. The trial court‘s inaction after permitting Stratton to supplement the 

record—thus maintaining an award of 100% of the lodestar, an amount within the 

range prescribed by rule 42(i)(1)—supports this conclusion. In light of the 

introductory warning that the letter was meant to clarify only ―some of the 

reasons for the court‘s ruling,‖ we have no way of knowing what Johnson factors, 

if not all of them, were considered in calculating the lodestar and what factors, if 

any, the trial court thought were irrelevant in considering a multiplier. What 

evidence we do have, however, does not demonstrate an abuse of discretion. 

Accordingly, to the extent that we address Stratton‘s third issue, I would affirm 

the trial court‘s judgment.
8

For the foregoing reasons, I respectfully dissent.

BILL MEIER

JUSTICE

DELIVERED: February 9, 2012