2009 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

10-8-2009

In Re: Diet Drugs

Precedential or Non-Precedential: Precedential

Docket No. 08-2363

Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2009

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova

University School of Law Digital Repository. It has been accepted for inclusion in 2009 Decisions by an authorized administrator of Villanova

University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.

Recommended Citation

"In Re: Diet Drugs " (2009). 2009 Decisions. Paper 339.

http://digitalcommons.law.villanova.edu/thirdcircuit_2009/339
PRECEDENTIAL

IN THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_____________

Nos. 08-2363 & 08-2387

_____________

IN RE: DIET DRUGS (PHENTERMINE/FENFLURAMINE/

DEXFENFLURAMINE)

PRODUCT LIABILITY LITIGATION

Randy Hague, Jana L. Harris, and Brian S. Riepen, Esq.,

 Appellants in 08-2363

Law Firms of Freedland, Farmer, Russo, Behren & Sheller

and Raymond Valori, P. A., individually and on behalf of 

Diet Drugs clients represented,

 Appellants in 08-2387

_______________

On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. No. 99-cv-20593)

District Judge: Honorable Harvey Bartle, III

_______________

Argued July 8, 2009

Before: SLOVITER, AMBRO and JORDAN, Circuit

Judges.
2

(Filed October 8, 2009)

_______________

Howard J. Bashman [ARGUED]

2300 Computer Avenue - Suite G-22

Willow Grove, PA 19090

Brian S. Riepen [ARGUED]

4607 W. Lovers Lane

Dallas, TX 75209

Counsel for Appellants Randy Hague, Jana L. Harris

 and Brian S. Riepen

Raymond W. Valori [ARGUED]

Raymond Valori, P.A.

2843 Executive Park Drive

Weston, FL 33331

Counsel for Appellants Freedland Farmer Russo

Behren & Sheller and Raymond Valori

Sol H. Weiss

Anapol, Schwartz, Weiss, Cohan, Feldman & Smalley

1710 Spruce Street 

Philadelphia, PA 19103

Charles R. Parker

Locke Lord Bissell & Liddell

600 Travis Streeet

3400 JP Morgan Chase Tower

Houston, TX 77002

Class Counsel & Appellee
3

Arnold Levin

Michael D. Fishbein [ARGUED]

Laurence S. Berman

Levin, Fishbein, Sedran & Berman

510 Walnut Street - Suite 500

Philadelphia, PA 19106

Class Counsel, Plaintiffs’ Liaison Counsel &

Plaintiffs’ Co-Lead

Counsel in MDL 1203 on behalf of Appellees

_______________

OPINION OF THE COURT

_______________

JORDAN, Circuit Judge.

Three law firms and some of their clients challenge the

final award of attorneys’ fees that the United States District

Court for the Eastern District of Pennsylvania entered on behalf

of class counsel in this landmark class action. For the following

reasons, we will affirm the award.

I. Background

A. Diet Drugs Litigation and Settlement

This appeal arises from multidistrict mass tort litigation

concerning the appetite suppressants fenfluramine, marketed as

“Pondimin,” and dexfenfluarmine, marketed as “Redux.” Over
 For convenience, we refer to the multidistrict federal 1

litigation in the singular, as a “case,” recognizing, however,

that it is an aggregation of numerous cases involving a large

number of individuals whose lives have been affected by the

litigation and its underlying events.

4

its decade-long course, the case has generated nearly 8000 1

separate orders from the District Court and numerous prior

rulings and opinions from this Court. E.g., In re Diet Drugs

Prods. Liab. Litig., 543 F.3d 179 (3d Cir. 2008); In re Diet

Drugs Prods. Liab. Litig., 431 F.3d 141 (3d Cir. 2005); In re

Diet Drugs Prods. Liab. Litig., 418 F.3d 372 (3d Cir. 2005); In

re Diet Drugs Prods. Liab. Litig., 401 F.3d 143 (3d Cir. 2005);

In re Diet Drugs Prods. Liab. Litig., 385 F.3d 386 (3d Cir.

2004); In re Diet Drugs Prods. Liab. Litig., 369 F.3d 293 (3d

Cir. 2004); In re Diet Drugs Prods. Liab. Litig., 282 F.3d 220

(3d Cir. 2002). Although we have already set forth the

background of the case and the class action settlement

agreement more than once, see, e.g., Diet Drugs, 385 F.3d at

389-93; Diet Drugs, 282 F.3d at 225-29, we do so once more in

order to provide context for our discussion of the fee award

entered by the District Court. 

Beginning in 1997, a tide of products liability lawsuits

arose after researchers discovered an association between some

commonly prescribed appetite suppressants and a series of

disorders generally known as valvular heart disease (“VHD”).

The drugs involved were “fen-phen,” a diet drug regimen that

paired fenfluarimine with phentermine, and dexfenlfuarmine,

which was developed to produce the same anorectic effects as
 Wyeth, a Delaware corporation, was previously known 2

as American Home Products but changed its name in March

2002. We will refer to the company as Wyeth throughout this

opinion. 

 Fen-phen and dexfenfluarmine were later linked to 3

primary pulmonary hypertension (“PPH”) as well. PPH is a

rare but deadly disease that is more commonly known as

pulmonary arterial hypertension, or PAH, in the medical

community today. Because it was called PPH in the late

1990s, we will refer to it as such in this opinion. 

5

fen-phen without the need for a drug pairing. Evidence of

serious coronary side effects from these drugs prompted the

United States Food and Drug Administration (“FDA”) to issue

a public health advisory alert, and the pharmaceutical company

Wyeth, which was responsible for the development and 2

promotion of fenfluramine and dexfenfluarmine, to withdraw

the drugs from the market. Former fen-phen and 3

dexfenfluarmine users filed lawsuits and instituted class actions

in numerous federal jurisdictions and state courts. Some of the

earliest litigation took place in state courts in Texas, where

attorneys, including Appellant Brian S. Riepen, brought

numerous actions against Wyeth. Those suits generated

extensive discovery, including the production by Wyeth of

approximately three million pages of documents.

Many diet drug suits were also filed in federal courts.

Pursuant to 28 U.S.C. § 1407, the Judicial Panel for Multidistrict

Litigation transferred all of those cases, including more than 130
 For convenience, we will sometimes use the singular 4

pronouns “he” and “his” in reference to Valori when

attributing arguments made collectively by Freedland, Farmer,

Russo, Behren & Sheller and Raymond Valori P.A. 

6

putative class actions, to the United States District Court for the

Eastern District of Pennsylvania for coordinated and/or

consolidated pretrial proceedings under MDL Docket No. 1203

(the “MDL”). Included among those actions were four cases

filed by Riepen. Likewise, Appellants Freedland, Farmer,

Russo, Behren & Sheller and Raymond Valori P.A. (collectively

“Valori” ) represented approximately ten clients involved in the 4

MDL. 

The District Court appointed a plaintiffs’ management

committee (the “PMC”) to oversee the litigation and to conduct

discovery of general applicability to the MDL plaintiffs. The

PMC began its discovery efforts in late 1998, and, by March

1999, it had taken 80 depositions and amassed approximately

nine million pages of documents, from which it winnowed 5,000

documents that, the PMC claims, established Wyeth’s liability.

The PMC stored the discovery results in an electronic document

depository and made it available to counsel for every plaintiff in

the MDL. As part of the discovery process, representatives of

the PMC attended regular status conferences held by a courtappointed special discovery master (the “Special Master”) and

prepared motions and responses regarding class-wide discovery,

in addition to addressing a variety of other pre-trial issues. 
 The state court in West Virginia had certified a personal 5

injury class as well. 

 Those options, summarized here, are spelled out in 6

greater detail in Diet Drugs, 431 F.3d at 144-45, and Diet

Drugs, 385 F.3d at 389-91. 

7

Ultimately, the PMC filed a class action against Wyeth to

pursue medical monitoring on behalf of former users of Wyeth’s

diet drugs. The PMC moved for class certification, and, on

August 26, 1999, the Court granted the motion. By then, state

courts in Illinois, New Jersey, New York, Pennsylvania, Texas,

Washington, and West Virginia had also certified medical

monitoring classes.

5

In April 1999, Wyeth, the PMC, and a coalition of

counsel involved in the state court class actions began to

negotiate a nationwide settlement. On November 18, 1999, they

executed an elaborate settlement agreement (the “Settlement

Agreement”) that contemplated a series of options for class

members. At the outset, class members could obtain an 6

echocardiogram at Wyeth’s expense, to determine if they

suffered from VHD, or they could exercise an initial opt-out

from the settlement and pursue their claims in separate tort

cases. Class members who chose not to take the initial opt-out

and were diagnosed with VHD would have a second choice to

make: they could receive a cash and medical services benefit or

exercise an intermediate opt-out from the Settlement Agreement,
 Those drug users who were diagnosed with PPH were 7

not covered by the Settlement Agreement. 

 The matrix grid recognized five levels of disease 8

severity, ranging from Level I (least severe) to Level V (most

severe). 

8

which, again, would free them to turn to the tort system. Wyeth 7

agreed to waive its statute-of-limitations defense against tort

claims by those opting out at that point. In exchange,

intermediate opt-out claimants were barred from seeking

punitive damages against the company. 

Class members who took the cash and medical services

benefit and developed more serious VHD before 2015 could

choose from yet a third pair of options. They could receive

payment in accordance with a matrix of calculations that

assigned compensation based on different levels of severity of

medical conditions. The “matrix claims” would be processed 8

based on the attestation of a physician, with Wyeth being able to

test the foundations of the claims through an audit process

permitting medical review of up to 15% of all such claims,

unless the Court ordered an expanded audit for good cause

shown. Alternatively, class members with worsening VHD

could exercise a back-end opt-out so that they could pursue their

claims in tort under the same conditions applicable to the

intermediate opt-out claims. 

To fund these various remedies, Wyeth agreed to create

a $3.75 billion settlement fund to be administered by court-
9

appointed trustees. The settlement fund was to be divided into

two sub-funds: Fund A, into which $1 billion would be injected,

would be designated for the payment of all non-matrix benefits.

Fund B, which would receive $2.55 billion, would be designated

for the payment of the matrix benefits. The remaining $200

million would go into an account denominated the “Fund A

Legal Fees Escrow Account,” from which attorneys who helped

to create and implement the Settlement Agreement would be

paid for services related to the non-matrix benefits. 

On August 28, 2000, the District Court certified the

settlement class and approved the Settlement Agreement. The

settlement was hailed as an innovative departure from ordinary

settlements requiring class members to make a “once-and-for-all

choice” between a private remedy scheme and the tort system.

Richard A. Nagareda, Autonomy, Peace, and Put Options in the

Mass Tort Class Action, 115 Harv. L. Rev. 747, 796 (2002).

Plaintiffs’ counsel and Wyeth were praised in particular for

creating the staged opt-out opportunities, which were viewed as

a bold compromise between the competing concerns of

individual autonomy for the class members and a comprehensive

legal peace for the corporate defendant. See id. at 797-805.

By the summer of 2002, however, the number of matrix

claims submitted to the trust and the number of class members

who exercised their intermediate and back-end opt-out rights

(collectively, “downstream opt-outs”) had grown well beyond

Wyeth’s expectations. Doubting the veracity of many of these

claims, Wyeth and the PMC sought, and were granted, an order

directing the medical review of 100% of the claims submitted to

the settlement trust. While the 100% audit helped to ensure the
 The total that Wyeth has spent, or will spend, to settle

9

diet drug lawsuits is uncertain. One commentator estimated

Wyeth’s “total potential cost” at $22 billion. Francis E.

McGovern, A Model State Mass Tort Settlement Statute, 80

Tul. L. Rev. 1809, 1814 (2006). The District Court put the

value of the funds created pursuant to the Settlement

Agreement, as amended, at $6.44 billion. In re Diet Drugs

Prods. Liab. Litig., 553 F.Supp.2d 442, 472 (E.D. Pa. 2008).

10

integrity of the claims review, it also increased the cost of trust

administration. Between the influx of new claims and the heavy

processing burden they created, Wyeth feared that it would not

have sufficient funds to satisfy all of its diet drug liabilities. The

District Court likewise concluded that the settlement was in

jeopardy, commenting that “it is not unlikely, absent some

curative amendment, that thousands of deserving class members

may never receive any compensation for their medical

conditions from ingesting Pondimin and Redux.” In re Diet

Drugs Prods. Litig., 226 F.R.D. 498, 509 (E.D. Pa. 2005). 

Wyeth and the PMC thus worked to amend the

Settlement Agreement. Most significantly for present purposes,

one of the changes, denominated the “Seventh Amendment,”

altered the payment matricies so that pending matrix level I and

II claimants became so-called “Category One Class Members.”

The claims of those Category One Class Members were

administered separately from the settlement trust, subjected to

independent medical review, and compensated from a separate

fund called the “Supplemental Class Settlement Fund,” into

which Wyeth injected an additional $1.275 billion. 

9
 In In re Diet Drug Litig., California Judicial Council 10

Proceeding No. 4032, the Court entered a coordination order

requiring plaintiffs to deposit into the MDL Fee and Cost

Account a percentage of their recovery equal of two-thirds the

assessment levied by the District Court in the MDL, in

exchange for access to PMC work product. Attorneys in

various other state cases entered into agreements reflecting

the same terms with the PMC. 

 For example, 6% of the value of the settlement obtained 11

by a claimant in a coordinated state case, taken from his

lawyer’s 30% fee, would amount to a withholding of

11

B. Attorneys’ Fees

The MDL and settlement process yielded four potential

sources for fees to compensate the PMC and other attorneys

who had a hand in creating common benefits for the enormous

class of claimants (collectively, “Class Counsel”). First, through

Pretrial Order (“PTO”) 467, entered in 1998, the District Court

ordered Wyeth to withhold 9% of the payments it made to

plaintiffs whose cases were transferred to the MDL and place

those funds in the “MDL Fee and Cost Account,” from which

Class Counsel would be compensated for providing case-wide

services. Likewise, the Court provided for the sequestration of

6% of the value of claims in state court cases where the

litigation was coordinated with the MDL. That money also 10

went into the MDL Fee and Cost Account. The percentages

were to be deducted from the fees due to the individual lawyers

for the opt-out claimants who recovered against Wyeth. 

11
approximately 20% of the attorney’s fee.

 By the terms of the Seventh Amendment, the fund 12

administrator was to deduct the Common Benefit Percentage

Amount from any distribution made to a Category One Class

Member. The District Court did not set the Common Benefit

Percentage Amount until it issued a final fee award, as

discussed below. 

12

Second, as discussed above, Wyeth deposited $200

million into the Fund A Legal Fees Escrow Account pursuant to

the Settlement Agreement. That account was the means of

paying Class Counsel for services related to the non-matrix

benefits. 

Third, also pursuant to the Settlement Agreement, $229

million was transferred from Fund B into an account known as

the “Fund B Legal Fees Escrow Account” to compensate Class

Counsel who helped to create the matrix benefits. 

Fourth and finally, the Seventh Amendment authorized

the Court to award a “Common Benefit Percentage Amount,”

i.e., “common benefit fees to attorneys for professional services

... found by the Court to be of ‘common benefit’ to Category

One Class Members.” (App. at 11882.) Those common benefit

fees would be drawn directly from the Supplemental Class

Settlement Fund, and not a separate legal fees account that

correlated to the fund. Where a Category One Class Member 12
 Otherwise, the award was to be deducted from the 13

benefit due to the Category One Class Member.

13

was represented by an attorney, the common benefit award was

to be deducted from the attorney’s fees. 

13

To summarize, then, the Court was authorized to pay

Class Counsel from four distinct “pots” of money: the MDL

Fee and Cost Account, the Fund A Legal Fees Escrow Account,

the Fund B Legal Fees Escrow Account, and the Supplemental

Class Settlement Fund. The first pot was established to

compensate Class Counsel for services, such as its efforts in

obtaining and storing discovery, performed for the benefit of all

class members, including those who were compensated outside

the context of the Settlement Agreement because, for example,

they suffered from PPH, opted out of the Settlement Agreement,

or participated in coordinated state litigation. Each of the other

pots corresponded to a particular fund established pursuant to

the Settlement Agreement and was evidently intended to reward

counsel for creating the particular benefits that claimants

received from that fund. Collectively, we will refer to these

latter three pots as the “Settlement Accounts.” 

1. Interim Fee Award

In the spring of 2001, the District Court established

procedures that would govern its consideration of the fee award

due to Class Counsel. As an initial step, it required all Class

Counsel to submit time and expense records to a court-appointed

auditor and to a lawyer designated as Plaintiffs’ Liaison
 The lodestar value is calculated by “multipl[ying] the 14

number of hours class counsel worked on a case by a

reasonable hourly billing rate for such services.” In re AT&T

Corp., 455 F.3d 160, 164 (3d Cir. 2006) (citation omitted). 

14

Counsel. The auditor, who was charged with determining which

items of time and expense met previously established criteria for

payment, reported that seventy-two law firms had performed

354,431.49 hours of compensable work and that a “lodestar

value” of $101,076,658.54 was appropriate in view of their

services. 

14

Each law firm claiming to be Class Counsel then had to

submit to Plaintiffs’ Liaison Counsel a fee presentation, which

was to contain a litany of information relevant to the services

rendered, including “[a] summary of the professional time for

which compensation or reimbursement is claimed ...” and

“[v]erified copies of all pertinent time records which were

maintained contemporaneously ... throughout this litigation ... .

” (App. at 7733.) The seventy-two firms that provided their

records to the auditor filed fee presentations with Plaintiffs’

Liaison Counsel, who, on February 15, 2002, submitted to the

Court a thirty-volume compendium containing the fee

presentations. On the same day, those same seventy-two firms

filed a joint petition for attorneys’ fees in which they requested

a total of approximately $567 million from the four available

funds. 
 Valori did not object at this point. 15

 The issues regarding the contract attorneys involved 16

whether they billed at rates that exceeded their experience in

mass tort litigation and the sort of work that they performed. 

15

There were nine objectors to the joint petition, including

Riepen. Riepen argued that he should not have to pay an MDL 15

assessment because he did not use PMC discovery, and he

argued that the requested class fee was too high, given what he

viewed as the low risk of non-compensation in the case. On

March 4, 2002, the District Court entered an order permitting

the objectors to request and, subject to court approval, to take

limited discovery regarding the petition. Riepen participated in

several discovery conferences, but did not seek any discovery.

Other objectors deposed PMC lead counsel on subjects that

included the details of the records submitted to Plaintiffs’

Liaison Counsel and the contributions of contract attorneys to

the PMC’s efforts. Once discovery was complete, the District 16

Court held a two-day hearing on the propriety of the fee award

sought in the petition. 

The District Court ruled on the fee petition on October 2,

2002, in an order designated as “PTO 2622.” In re Diet Drugs

Prods. Liab. Litig., Civ. Action No. 99-20593, 2002 WL

32154197 (E.D. Pa. Oct. 3, 2002). Based on its findings that (1)

“[t]he PMC faced significant risk at the beginning of the

litigation that the work they did would be unsuccessful and

uncompensated,” (2) “[t]he discovery package created by the

PMC ultimately paved the way for the class settlement and many
 Because the total amount in the MDL Fee and Cost 17

Account represented 9% of the MDL plaintiffs’ recoveries

and 6% of recoveries by claimants in coordinated state

actions, the Court directed the refund of one-third of the

amount sequestered from recoveries in those cases. 

 The interim fee determination occurred before the 18

Seventh Amendment to the Settlement Agreement. 

Accordingly, there was no Supplemental Class Settlement

Fund from which to draw attorneys’ fees.

16

individual settlements,” and (3) “the PMC conferred great

benefits on all litigants in the MDL and state-coordinated

litigation [and] ... performed their duties with admirable skill,

diligence, and efficiency,” the Court awarded Class Counsel 6%

of the recoveries by claimants whose actions were part of the

MDL and 4% of the recoveries by claimants in coordinated state

actions (the “6% & 4% Assessment”). Id. at *19. That 17

entitled Class Counsel to a distribution of $76,861,455 from the

MDL Fee and Cost Account. 

As to the fees to be drawn from the Settlement Accounts,

the Court found it “premature to perform a definitive ... analysis

... [because t]here is a significant amount of work still to be

done ... in assisting the administration of the Settlement

Agreement.” Id. at *11. It concluded, however, that Class

Counsel was entitled to a payment of almost $77 million –

$38,430,728 from the Fund A legal fees escrow account and the

same amount from the Fund B legal fees escrow account.18

Riepen and other objectors appealed, but we dismissed for lack
 By that time, the Court had already conducted two 19

public hearings on the adjudication of a fee award – one in

May 2005 and one in June 2005. Pursuant to those hearings,

the Court ordered all counsel who were claiming entitlement

to a fee award to submit their time and expense records,

onward from June 30, 2001, for audit review in accordance

with the procedures that it had established in the Spring of

2001. 

17

of jurisdiction, holding that PTO 2622 was neither a final order

nor a collateral order from which an appeal could be brought.

Diet Drugs, 401 F.3d 143. 

2. Final Fee Award

On January 5, 2007, the Court sought suggestions

regarding the procedures and timetable it should use in

determining a final fee award. It invited any interested party to

submit a memorandum on the subject, and it scheduled a hearing

for March 1, 2007. In response, the PMC filed a compendium 19

of written agreements among the now ninety firms that claimed

entitlement to common benefit fees and between those firms

and a group of lawyers that came to be known as the “Major

Filers.” The Major Filers consist of more than fifty law firms

that together represented approximately 97% of the downstream

opt-out plaintiffs, 26,000 claimants who were compensated

under the Seventh Amendment, and half of all class members
 None of the Major Filers were members of the PMC 20

and none performed compensable work for the benefit of the

entire class. 

 Appellants refer to the agreements as the “Major Filer 21

Agreements,” so we do as well. That said, we recognize that

the term is a bit of a misnomer because the compendium

submitted to the District Court included agreements among

Class Counsel, along with agreements between Class Counsel

and the Major Filers. 

 That monetary amount represents 77.78% of the amount 22

originally deposited into the account. 

18

who received matrix payments through May 31, 2007. Neither 20

Riepen nor Valori was among the Major Filers. 

Those agreements (the “Major Filer Agreements” )

21

reflected the shared understanding of Class Counsel and the

Major Filers that “the amount to be awarded in common benefit

fees ... is to be determined by the Court in the exercise of its

sound discretion ... .” (App. at 12976-77.) Subject to that

understanding, however, Class Counsel and the Major Filers

agreed that Class Counsel would request the entire $200 million

originally deposited in the Fund A Legal Fees Escrow Account,

plus interest; $178,111,111 from the Fund B Legal Fees Escrow

Account; and 7% of the benefits paid under the Seventh 22

Amendment. Additionally, they agreed that it was appropriate

for Class Counsel to levy a reduced assessment – 2% in federal

cases and 1.33% in state cases – on recoveries obtained by
 In contrast, recoveries in the initial opt-out and PPH 23

cases occurred completely outside the context of class

settlement, because those plaintiffs either chose to go without

the benefits created by the Settlement Agreement (the initial

opt-out claimants) or were expressly not contemplated by the

Settlement Agreement (the PPH claimants). 

19

downstream opt-out claimants. The rationale behind the

reduction, as stated in the Major Filer Agreements, was that

recoveries in the downstream opt-out cases – as opposed to the

initial opt-out and PPH cases – occurred in part because of the

Settlement Agreement, which had its own mechanisms for

compensating attorneys. In the PMC’s words, the reduction 23

“served as a prophylactic against ‘double dipping’” by Class

Counsel. (Appellee’s Br., No. 08-2387, at 25.) The Major

Filers agreed that they would not object to the fees sought by

Class Counsel, and the parties represented that there were no

other “agreements, promises, or undertakings” among them.

(App. at 13023.)

After the March 1 hearing, the District Court entered an

order, in accordance with the procedures it had established to

adjudicate the interim fee award, requiring that the auditor

submit a report of the compensable time and expenses claimed

by counsel, that Class Counsel submit supplemental fee

presentations to Plaintiffs’ Liaison Counsel, and that Plaintiffs’

Liaison Counsel file a compendium of the fee presentations with

the Court. The auditor reported that, from the inception of

litigation, Class Counsel had expended 553,020.53 hours in

common benefit time, thereby producing a lodestar value of
20

$156,849,257.24. On July 16, 2007, Plaintiffs’ Liaison Counsel

filed the compendium of fee presentations and, on behalf of

Class Counsel, a joint fee petition that complied with the terms

to which Class Counsel and the Major Filers had agreed. 

As it did in connection with the 2002 joint fee petition,

the Court authorized those who objected to the petition to

request limited discovery. Valori moved for discovery on

August 7, 2007. The Special Master concluded that the motion

was untimely and, because it did not adhere to the Court’s

instruction that any such motion set forth a concise statement of

the need and legal basis for discovery, deficient. Nevertheless,

the Court permitted Valori to depose the PMC’s lead counsel

regarding the terms and meaning of the compendium of

agreements that lead counsel had submitted to the Court and

whether any side agreements existed between Class Counsel and

the Major Filers. 

Thereafter, Valori filed an objection to the joint fee

petition. The two primary arguments in the objection were that

the requested award was too high because there was a low risk

of non-payment, given the existence of the legal fees escrow

accounts, and that the requested award did not allocate the

burden of payment proportionally between the initial opt-out and

PPH claimants, on one hand, and the downstream opt-out

claimants, on the other, according to the benefits that each group

received. Riepen also objected to the joint fee petition,

renewing the arguments that he had made in response to the

2002 fee petition. 
 As discussed in more detail below, this method requires 24

the Court to determine the overall value of the common fund

and then calculate an appropriate percentage of that fund to

award in attorneys’ fees based on a series of reasonableness

factors that have been developed through our jurisprudence. 

21

On April 8, 2008, the District Court ruled on the petition,

in an order designated as “PTO 7763(A).” In re Diet Drugs

Prods. Liab. Litig., 553 F.Supp.2d 442 (E.D. Pa. 2008). It

awarded Class Counsel a total amount of approximately $567

million, including the approximately $154 million that

constituted the interim fee award, broken down in the following

manner. First, the Court applied the percentage-of-recovery

method to determine the appropriate fee award to be allocated 24

from the Settlement Accounts. Id. at 467-85. In light of the

reasonableness factors that we articulated in In re Prudential

Ins. Co. Am. Sales Practice Litig. Against Agent Actions, 148

F.3d 283 (3d Cir. 1998), and Gunter v. Ridgewood Energy

Corp., 223 F.3d 190 (3d Cir. 2000), it concluded that an award

equaling 6.75% of the recoveries under the Settlement

Agreement – which the Court valued at $6.44 billion – was fair

and appropriate. Diet Drugs, 553 F.Supp.2d at 485. The Court

then performed a lodestar cross-check “to gauge whether the ...

award creat[ed] a windfall” for the petitioners. Id. By the

Court’s calculation, the award represented a lodestar multiplier

of 2.6. Id. at 486. While it recognized that its multiplier was

artificially low, given that the auditor’s report did not separate

the time spent on the Settlement Agreement from time spent on
 Recall that the Court was authorized to pay Class 25

Counsel from four pots of money, three of which

corresponded to particular funds established pursuant to the

Settlement Agreement and one of which – the MDL Fee and

Cost Account – was designed to compensate Class Counsel

for the benefits that they bestowed on all plaintiffs, including

those who recovered outside the context of the Settlement

Agreement. 

 By “super-mega-fund cases,” the Court was referring to 26

“cases with valuations of larger than one billion dollars.” Id.

at 487.

22

the MDL, it felt confident that the true multiplier – whatever 25

it was – was not excessive for a “super-mega fund case” such as

this one. Id. at 487. 

26

Second, the Court determined how to apportion the

6.75% award from among the Settlement Accounts. From the

Fund A Legal Fees Escrow Account, it awarded Class Counsel

$161,569,272, which, when added to its interim distribution of

$38,430,728, equaled $200,000,000 – the amount that was

originally deposited into that account. Id. at 487. From the

Fund B Legal Fees Escrow Account, it awarded

$124,633,410.60, which, when added to its interim distribution

of $38,430,728, equaled $163,064,138.60, which represented

6.39% of Fund B’s original $2.55 billion value. Id. at 488.

Finding no reason why the fee award pertaining to recoveries

under the Seventh Amendment should be materially different
 Recall that Class Counsel was to be compensated from 27

the Fund B Legal Fees Escrow Account for the matrix

benefits established pursuant to the Settlement Agreement and

from the Supplemental Class Settlement Fund for benefits

established pursuant to the Seventh Amendment. 

 In summary, then, the District Court awarded Class 28

Counsel $200 million from the Fund A Legal Fees Escrow

Account ($38,430,728 in its interim distribution and

$161,569,272 in its final award), $163,064,138.60 from the

Fund B Legal Fees Escrow Account ($38,430,728 in its

interim distribution and $124,633,410.60 in its final award), 

$71,447,638.10 from the Supplemental Class Settlement Fund

23

from that related to matrix benefits, the Court also awarded 27

Class Counsel 6.4% of the Supplemental Class Settlement Fund.

Id. That distribution amounted to $71,447,638.10. Id. 

Third, the Court determined that the justifications that

supported the 6% & 4% Assessment in 2002 still applied with

equal force, and it approved Class Counsel’s proposed reduction

in the assessment – to 2% in federal cases and 1.33% in state

cases – for downstream opt-out claimants based on the logic that

those claimants had incurred value from the Settlement

Agreement that initial opt-out and PPH claimants did not incur,

and Class Counsel was rewarded for creating that value from the

Fund A Legal Fees Escrow Account. See id. at 491-96. It

updated the award from the MDL Fee and Cost Account

accordingly, adding $56,300,000 to the interim distribution of

$76,861,455 for a total award of $133,161,455. Id. at 496. 

28
(all in its final award), and $133,161,455 from the MDL Fee

and Cost Account ($76,861,455 in its interim distribution and

$53,000,000 in its final award), for a total fee award of

$567,673,231.70, which we have approximated to $567

million for purposes of discussion. 

 Riepen filed an appeal on his own behalf and on behalf 29

of two of his clients in the diet drug litigation, Randy Hague

and Jana L. Harris. 

24

The District Court then requested submissions regarding

how to refund the money left over in the MDL Fee and Cost

Account and the funds established pursuant to the Settlement

Agreement, and it instructed Plaintiffs’ Liaison Counsel to

submit a plan regarding the allocation of the award among Class

Counsel. On July 21, 2008, the Court completed adjudication of

the fee award. PTO 7896 wrapped up the remaining refund and

allocation issues, and PTO 7897 certified as final PTOs 2622,

7763(A), and 7896. 

C. Appeal

Riepen filed a notice of appeal from PTO 2622, the

interim fee award, and from PTO 7763(A), the final fee award,

on May 6, 2008. Valori filed a notice of appeal from PTO 29

7763(A) on May 8, 2008. We have consolidated the appeals for

disposition. 
 The District Court had jurisdiction over this 30

multidistrict litigation pursuant to 28 U.S.C. §§ 1332(a),

1407. We have jurisdiction under 28 U.S.C. § 1291, despite

the fact that Appellants took an appeal from PTO 7763(A), in

which the Court ruled on the joint fee petition, instead of PTO

7897, in which the Court entered PTOs 2622, 7763(A), and

7896 as final judgments. Under Fed. R. App. P. 4(a)(2), a

notice of appeal filed after the court announces a final

decision or order, but before it enters final judgment, “is

treated as filed on the date of and after the entry.” See also

FirsTier Mortgage Co. v. Investors Mortgage Co., 498 U.S.

269, 276 (1991) (Rule 4(a)(2) permits a premature notice of

appeal from a final decision, but not an interlocutory one.). 

While PTO 7763(A) left open issues of allocation and

redistribution, it bestowed a definitive award on Class

Counsel. It is thus a final decision under our jurisprudence. 

See, e.g., United Auto. Workers Local 259 Soc. Sec. Dept. v.

Metro Auto Ctr., 501 F.3d 283, 286 (3d Cir. 2007) (“Because

the District Court’s order ... reduced the fee award to a

definite amount, it was a final decision.”); Interfaith Cmty.

Org. v. Honeywell Intern., Inc., 426 F.3d 694, 701 (3d Cir.

2005) (Honeywell timely appealed “f[inding] that ICO was

entitled to $4,530,327.00 in [attorneys’] fees”).

25

II. Discussion30

 “[A] thorough judicial review of fee applications is

required in all class action settlements.” In re Gen’l Mots. Corp.

Pick-up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d 768, 819

(3d Cir. 1995). We review the District Court’s fee
26

determination for abuse of discretion, “which can occur if the

judge fails to apply the proper procedures in making the

determination, or bases an award upon findings of fact that are

clearly erroneous.” In re Cendant Corp. PRIDES Litig., 243

F.3d 722, 727 (3d Cir. 2001) (internal quotations and citations

omitted). To ensure that we will have a sufficient basis for

review, we require district courts to set forth the reasoning in

support of a fee award. In re Rite Aid Corp. Sec. Litig., 396

F.3d 294, 301 (3d Cir. 2005). 

Appellants object to three aspects of the fee award in this

case: the level of transparency inherent in the process that led

to the award, the size of the award derived from the Settlement

Accounts, and the applicability of the MDL assessments to their

individual cases. We address each challenge in turn. 

A. Transparency of the Proceedings

Riepen claims that the fee award was the product of a

flawed process in which the District Court accepted summaries

from the auditor and Plaintiffs’ Liaison Counsel instead of

requiring the public filing of actual time and expense reports

from Class Counsel. According to Riepen, the procedure

adopted by the District Court violates the principles of

transparency espoused by the United States Court of Appeals for

the Fifth Circuit in In re High Sulfur Content Gasoline Prods.

Liab. Litig., 517 F.3d 220 (5th Cir. 2008). In High Sulfur, the

lead plaintiffs’ counsel in a class action persuaded the district

court, during an ex parte hearing and without the benefit of

supporting data, to divide a lump sum attorneys’ fee award

among more than six dozen plaintiffs’ lawyers. Id. at 223. At
27

that same hearing, the Court “accepted [l]ead [c]ounsel’s

proposed order sealing the individual awards; preventing all

counsel from communicating with anyone about the awards;

requiring releases from counsel who accepted payment; and

limiting its own scope of review of objections to the allocation.”

 Id. at 223-24. Because “the record [was] bereft of factual

information essential to ... appellate review,” and because the

sealing of the record “protect[ed] no legitimate privacy interest

that would overcome the public’s right to be informed,” the

Court of Appeals vacated the award. Id. at 229-30.

There are two answers to Riepen’s reliance on High

Sulfur. First, this case is so factually distinct from that one that

comparing the two is fruitless. Far from adjudicating the fee

award in an ex parte hearing, the District Court solicited

submissions from all interested parties concerning “what steps

and procedures the court should implement, as well as a

suggested timetable, in determining any final or other awards of

attorneys’ fees,” and it held three public hearings on the matter.

(App. at 12624.) Moreover, during adjudication of both the

interim and final fee awards, the Court permitted objections and

allowed objectors to take limited discovery, though it need not

have granted any discovery at all. See Prudential, 148 F.3d at

338, 342 (recognizing that “discovery in connection with fee

motions should rarely be permitted,” and that “whether to grant

discovery is committed to the sound discretion of the [district]

court” (internal quotations and citation omitted)). Finally, the

Court required the auditor and Plaintiffs’ Liaison Counsel to

submit volumes of data reflecting the time and money that Class

Counsel spent on the diet drugs litigation – data that the Court
 Riepen also claims that the compendium of fee

31

presentations prepared by Plaintiffs’ Liaison Counsel was

missing from the public record when he went to the

courthouse to examine it, and he questions whether the

compendium contained “the detail of time and expense

records required by basic judicial standards of transparency.” 

(Appellant’s Br., No. 08-2363, at 29.) Suffice it to say that

the compendiums included in the appellate record are not

lacking in detail. Riepen also argues that the PMC’s decision

not to file the compendium electronically “in and of itself

creates a transparency problem,” because the paper-filing

method deterred people from accessing the documents. 

(Appellant’s Br., No. 08-2363, at 28.) That contention is

undermined by the fact that the compendium was accessed,

and used as the basis for discovery requests, by objectors to

the joint fee petition. 

28

put on the public record and used to support the fee award that

it ultimately granted. 

31

Second, High Sulfur aside, the fee proceedings were

amply transparent under our precedent. Indeed, it is difficult to

discern what the District Court reasonably could have done to

increase the level of transparency associated with the fee award.

Riepen suggests that the Court should have considered and made

public Class Counsel’s individual billing records, but we have

held that courts need not always engage in that time-consuming

process. See Rite Aid, 396 F.3d at 306-07 (“[D]istrict courts

may rely on summaries submitted by the attorneys and need not

review actual billing records.” (citing Prudential, 148 F.3d at
 In a related transparency argument, Riepen contends 32

that the District Court abused its discretion in finalizing the

award without requiring Class Counsel to specify how many

hours and which expenses were related to each aspect of their

common benefit work. Specifically, Riepen contends that by

permitting Class Counsel to commingle their records, the

Court endorsed a fee allocation that violated the Settlement

Agreement and the mandates of Boeing Co. v. Van Gemert,

444 U.S. 472 (1980). Section VII.E.1 of the Settlement

Agreement authorizes the District Court to award fees for

services related to Fund A from the Fund A Escrow Account

and provides that “[a]ttorneys’ fees relating to Fund B shall be

paid from Fund B.” (App. at 633.) However, the purpose of

that section is to create the mechanisms by which the Court

could award attorney fees; it does not mandate how – or,

indeed, whether – counsel must submit their time records in

order to get paid. Riepen’s reliance on Boeing is similarly

misplaced. That case requires courts awarding attorneys’ fees

to ensure that “the benefits of class recovery” are “traced with

some accuracy.” Id. at 480-81 (internal quotations and

citation omitted). However, the “benefit” to which it refers –

and which must be “traced with some accuracy” – is the

29

342)). In large cases, especially one of prodigious proportions

like this, reliance on summaries is certainly within the discretion

of the district court. Also, as the High Sulfur Court recognized,

transparent fee proceedings are necessary, in part, so that we can

engage in meaningful appellate review of the resulting award.

The District Court’s procedures in this case have been more than

adequate to that end. 

32
monetary relief that the plaintiffs recover, not the work that

the attorneys do to secure it. It is true that, in addition to the

“benefits of class recovery,” Boeing addresses the manner in

which the costs of attorneys’ fees must be shifted to the

beneficiaries. See id. But Riepen’s transparency argument

does not implicate that aspect of Boeing. Moreover, for the

reasons discussed infra, we believe that the District Court has

satisfied the cost-shifting requirements set forth by the Boeing

Court. 

30

B. Size of the Settlement Award

Appellants argue that the portion of the fee awarded from

the Settlement Accounts, more than $434 million in all, was

excessive. Riepen claims that the District Court improperly

calculated the award as a percentage of the recovery, instead of

using the lodestar method, and Riepen and Valori both contend

that the award is based on an erroneous application of the

reasonableness factors we have previously articulated. 

1. Method of Calculation

“Attorneys’ fees are typically assessed through the

percentage-of-recovery method or through the lodestar method.”

 In re AT&T Corp., 455 F.3d 160, 164 (3d Cir. 2006) (citation

omitted). The former “applies a certain percentage to the

[settlement] fund.” Id. (citation omitted). The latter “multiplies

the number of hours class counsel worked on a case by a
 After a court determines the lodestar amount, it may 33

increase or decrease that amount by applying a lodestar

multiplier. “The multiplier is a device that attempts to

account for the contingent nature or risk involved in a

particular case and the quality of the attorneys’ work.” Rite

Aid, 396 F.3d at 305-06. 

31

reasonable hourly billing rate for such services.” Id. (citation 33

omitted). 

Riepen argues that the District Court’s employment of the

percentage-of-recovery method was erroneous because, when a

case involves fee shifting as does this one, the lodestar method

should be used. Riepen’s contention is misguided for two

reasons. First, no “fee shifting,” as that term is traditionally

used, occurred in this case. Fee shifting – an exception to the

so-called “American Rule,” whereby parties pay their own

attorneys’ fees – occurs when one party is compelled by statute

to bear the opposing party’s fees. Alyeska Pipeline Svc. Co. v.

Wilderness Soc’y, 421 U.S. 240, 269-70 (1975). It is true that,

under our precedent, the lodestar method is often applied in

cases where fee-shifting statutes operate. Prudential, 148 F.3d

at 333. But there is no such statute at work here. Wyeth

voluntarily undertook the process of compensating opposing

counsel, by establishing and funding various escrow accounts

dedicated to the payment of claimants’ legal costs. Second,

even if this case could be said to involve fee shifting, Riepen

does not complain about fee shifting at all. His problem is not

that the burden of attorneys’ fees was improperly “shifted” from

the plaintiffs to Wyeth. Rather, Riepen is appealing the fee
32

award to challenge the allocation of fees among the various

attorneys who represented plaintiffs’ interests. 

Contrary to Riepen’s characterization, this case falls

under the common fund doctrine, a second exception to the

American Rule. That “doctrine ‘provides that a private plaintiff,

or plaintiff’s attorney, whose efforts create, discover, increase,

or preserve a fund to which others also have a claim, is entitled

to recover from the fund the costs of his litigation, including

attorneys’ fees.’” In re Cendant Corp. Sec. Litig., 404 F.3d 173,

187 (3d Cir. 2005) (quoting G.M. Trucks, 55 F.3d at 820 n.39).

When calculating attorneys’ fees in such cases, the percentageof-recovery method is generally favored. Prudential, 148 F.3d

at 333; see also The Manual for Complex Litigation § 14.121

(4th ed. 2004) (reporting that “the vast majority of courts of

appeals now permit or direct district courts to use the percentage

method in common-fund cases”). 

It was entirely appropriate for the District Court to adhere

to the general convention and apply the percentage-of-recovery

method in this case. The lodestar method is “designed to reward

counsel for undertaking socially beneficial litigation in cases

where the expected relief has a small enough monetary value

that a percentage-of-recovery method would provide inadequate

compensation.” Prudential, 148 F.3d at 333. Riepen contends,

however, that the percentage-of-recovery method resulted in too

much, as opposed to “inadequate,” compensation for Class

Counsel in this case. Moreover, the financial stakes in this case

were enormous, and the lawyers involved were primarily

concerned with obtaining relief for their clients and the members

of the class, not with serving the public interest. Thus, the
 The Gunter/Prudential factors are not exhaustive. “In 34

reviewing an attorneys’ fee award in a class action settlement,

a district court should consider [those] factors ... , and any 

33

District Court correctly applied the method better designed to

“reward[] counsel for success and penalize[] it for failure.”

G.M. Trucks, 55 F.3d at 821.

2. Percentage-of-Recovery Analysis

In determining what constitutes a reasonable percentage

fee award, a district court must consider the ten factors that we

identified in Gunter, 223 F.3d 190, and Prudential, 148 F.3d

283. They are: (1) the size of the fund created and the number

of beneficiaries, (2) the presence or absence of substantial

objections by members of the class to the settlement terms

and/or fees requested by counsel, (3) the skill and efficiency of

the attorneys involved, (4) the complexity and duration of the

litigation, (5) the risk of nonpayment, (6) the amount of time

devoted to the case by plaintiffs’ counsel, (7) the awards in

similar cases, Gunter, 223 F.3d at 195 n.1; Prudential, 148 F.3d

336-40, (8) the value of benefits attributable to the efforts of

class counsel relative to the efforts of other groups, such as

government agencies conducting investigations, (9) the

percentage fee that would have been negotiated had the case

been subject to a private contingent fee arrangement at the time

counsel was retained, and (10) any innovative terms of

settlement, Prudential, 148 F.3d at 338-40; see also AT&T, 455

F.3d at 165.34
other factors that are useful and relevant with respect to the

particular facts of the case.” AT&T, 455 F.3d at 166.

 Additionally, Valori argues that the Court could not 35

have properly applied at least two Gunter/Prudential factors –

the efficiency of the attorneys involved and the relative value

of the benefit attributable to counsel’s efforts – because it did

not know how many hours Class Counsel devoted to each

aspect of its common benefit work. We have never said that a

court must have that sort of information to apply the

Gunter/Prudential factors. To the contrary, as noted above,

we have explained that “courts may rely on summaries

submitted by the attorneys and need not review actual billing

records.” Rite Aid, 396 F.3d at 306-07 (citing Prudential, 148

F.3d at 342). It would be inconsistent to permit courts to rely

on billing summaries, in lieu of actual records, but to require

that those summaries have the sort of itemization that Valori

insists they should have. Moreover, while the lodestar

method is focused on the hours that counsel expended, the

percentage-of-recovery method is, by definition, calculated

34

Trial courts must “engage in robust assessments of the

[Gunter/Prudential] factors when evaluating a fee request,” Rite

Aid, 396 F.3d at 302 (citation omitted), and that occurred here.

In an exhaustive opinion, the District Court gave thorough

consideration to each of the factors. Appellants do not argue to

the contrary. Instead, they challenge the Court’s analysis of

three particular factors: the presence or absence of substantial

objections, the risk of nonpayment, and the value of benefits

attributable to the efforts of other groups.35
based on the benefit that counsel conferred on the plaintiffs. 

Thus, neither law nor logic required the District Court to

consider the division of counsel’s labor while determining the

appropriate percentage of recovery through its analysis of the

Gunter/Prudential factors. 

 Relatedly, Riepen argues that both section III.B.3 of the 36

Settlement Agreement, which prevented Wyeth from

participating in fee award proceedings, and the Major Filer

Agreements eliminated likely objectors to the fee arrangement

in a manner that violated public policy. Why Riepen believes

that Wyeth was concerned about how the money it designated

35

i. Presence or Absence of Substantial

Objections

The District Court found it “remarkable” that there were

so few objections to the settlement terms and to the fees

requested by counsel, given the approximately six million class

members in the MDL. Diet Drugs, 553 F.Supp.2d at 473. By

the Court’s count, fewer than thirty objections to the Settlement

Agreement, eleven objections to the interim joint fee petition,

and only four objections to the final joint fee petition were filed.

Id. Valori claims that it was clear error for the District Court to

rely so heavily on the absence of objections to the final joint fee

petition because the Major Filers, some of whom had vigorously

contested the interim petition, agreed not to object. In essence,

according to Valori, the Class Counsel improperly influenced

this factor through their Agreement with the Major Filers, and

the Court should not have considered it.36
for attorneys’ fees was distributed is unclear, but, in any

event, the time to object to the District Court’s eight-year-old

finding that section III.B.3 was proper – a finding that was

part of the order approving the Settlement Agreement, see

Diet Drugs, 385 F.3d at 396 – has long since passed. As to

the Major Filer Agreements, no authority suggests that courts

should abrogate valid fee division contracts. To the contrary,

we have recognized the benefits of agreements regarding the

distribution of attorney fees. See, e.g., In re Warfarin Sodium

Antitrust Litig., 391 F.3d 516, 533 n.15 (3d Cir. 2004) (noting

“the accepted practice of allowing counsel to apportion fees

amongst themselves”); Prudential, 148 F.3d at 329 n.96

(private allocation agreements relieve courts from

“undertak[ing] the difficult task of assessing counsels’

relative contributions”) (citation omitted)). 

36

Valori overstates the Court’s reliance on the lack of

objections. In fact, the Court explicitly declared that

[t]he paucity of objections filed in response to the

original and renewed petitions for attorneys’ fees

and costs does not necessarily establish that the

requests in the Joint Petition are proper. Indeed,

some objectors may not have been forthcoming

because this court is obligated to “exercise its

inherent authority to assure that the amount and

mode of payment of attorneys’ fees are fair and

proper ... independently of any objection.”

Diet Drugs, 553 F.Supp.2d at 474 (quoting Cendant PRIDES,
37

243 F.3d at 730). Valori also fails to recognize the breadth of

the Court’s analysis. Whatever weight the Court gave to this

factor it gave based on the dearth of objections throughout the

settlement and fee adjudication process, instead of focusing only

on the objections to the final joint fee petition. Finally, Valori

distorts the effect of the agreement between Class Counsel and

the Major Filers. The record indicates that only one Major Filer

objected to the interim fee petition, and there is nothing but

Valori’s argument, unsupported by evidence, that suggests that

more of the Major Filers would have objected to the final

petition absent the agreement. In short, Valori’s contention

leaves us unpersuaded that the District Court erred – clearly or

otherwise – in its consideration of this factor. 

ii. Risk of Nonpayment

Appellants claim that the District Court applied the

wrong legal standard to its risk-of-nonpayment analysis, made

at least one erroneous factual finding, and neglected to consider

an important risk mitigator. We disagree with them on each

point. 

Valori argues that the District Court erred as a matter of

law by assessing the risk of nonpayment only at the beginning

of litigation, instead of throughout the action. That risk,

according to Valori, dissipated after the Settlement Agreement

was reached and, pursuant to its terms, Wyeth agreed to fund

escrow accounts from which Class Counsel would be

compensated. 
38

We have never addressed whether courts must reconsider

the risk of nonpayment as the action evolves, and we need not

do so here because, whether it was required or not, the District

Court did reassess the risk in this case. Although the Court

stated that it was evaluating the risk of nonpayment as of “the

inception of the action and not through the rosy lens of

hindsight,” Diet Drugs, 553 F.Supp.2d at 478 (citing In re

NASDAQ Market-Makers Antitrust Litig., 187 F.R.D. 465, 488

(S.D.N.Y. 1998)), its analysis was more comprehensive than

that. The Court specifically concluded:

The risk of non[]payment did not end with the

approval of the Settlement Agreement. The

“second wave” of litigation increased the liability

exposure Wyeth faced and endangered the entire

Settlement Agreement. [Class Counsel] renewed

and redoubled their efforts at this point, not

knowing whether the Settlement Agreement could

be saved. Fortunately it was, but during this time

it again appeared uncertain whether [Class

Counsel] could reach a point in this litigation

where they would be compensated for all of their

efforts. At the inception, and throughout this

litigation, there was a substantial risk that the

efforts of [Class Counsel] would not be

successful.

Id. at 479. In practice, therefore, the Court evaluated the risk of

nonpayment in the very manner that Valori advocates; Valori

simply does not like the conclusion the Court reached.
39

In a related argument, Riepen takes issue with the Court’s

finding that Class Counsel “faced significant risk [of

nonpayment] at the beginning of the litigation.” Id. at 478. He

claims that, to the contrary, the “deck [was] stacked against

Wyeth from the very beginning.” (Appellant’s Br., No. 08-

2363, at 41.) Wyeth, according to Riepen, faced potentially

crippling liability, through state and federal litigation, and highprofile scholarship that established the link between the diet

drugs and heart disease. As a result, it entered into settlement

negotiations with the PMC very early in the litigation process,

and as part of the settlement it agreed to pay more than $400

million into two funds from which class attorneys would be

compensated. 

Riepen confuses the risk of nonpayment at the inception

of litigation with the risk immediately after the Settlement

Agreement was executed. While the escrow funds undoubtedly

reduced the risk of nonpayment, those funds were but one part

of an intricate agreement that the PMC negotiated with Wyeth.

If, as the District Court recognized, the Settlement Agreement

“had not been structured to avoid a ruinous outcome for Wyeth,

the efforts of [Class Counsel] would have been for naught.”

Diet Drugs, 553 F.Supp.2d at 479. Additionally, Riepen’s view

of the risk of nonpayment is more myopic than the Court’s. As

noted above, the Court assessed risk not at one fixed point in the

action, but throughout its existence. Riepen does not challenge,

for example, the Court’s finding that the risk of nonpayment

increased once the “second wave” of litigation threatened the

Settlement Agreement, and, based on the record, he could not

persuasively do so. 
40

Lastly, Valori contends that the Court erred in evaluating

the risk of nonpayment by neglecting to consider the “potentially

billions of dollars in fees” that Class Counsel was receiving

from their representation of diet drug claimants in concurrent

state law cases. What individual counsel received in a particular

state case, however, is irrelevant to the fee award here, which

compensates Class Counsel for services that benefitted all class

members, as well as the litigants in coordinated state actions.

See, e.g., Rite Aid, 396 F.3d at 302 n.11 (refusing to “conflate []

two distinct settlements” when considering the “reasonableness

of the attorneys’ fees based on one settlement fund”).

iii. Value of Benefits Attributable to

Others

In assessing whether Class Counsel had benefitted from

“the efforts of other groups, such as government agencies

conducting investigations,” AT&T, 455 F.3d at 165 (citation

omitted), the District Court noted that this case differed from the

typical antitrust or securities litigation – in which the

Gunter/Prudential factors are often considered – “where

government prosecutions frequently lay the groundwork for

private litigation,” Diet Drugs, 553 F.Supp.2d at 481. The Court

concluded that, while Class Counsel was in some sense

beholden to the scholars who linked the diet drugs to VHD, and

beholden as well to the FDA for its efforts to remove the drugs

from the market, Class Counsel had not relied on “the

government or other public agencies to do their work for them

as has occurred in some cases.” Id. at 481-82. 
 Similarly, we have referred to the settlement as “a 37

landmark effort to reconcile the rights of millions of

individual plaintiffs with the efficiencies and fairness of a

class-based settlement.” Diet Drugs, 369 F.3d at 317. 

41

According to Riepen, the Court committed an error of

law by limiting its analysis to the efforts of scholars and the

FDA, and thereby ignoring the contributions of the lawyers who,

while conducting contemporaneous diet drugs litigation in Texas

state courts, obtained millions of pages of discovery from Wyeth

and took 43 depositions before a single deposition took place in

the MDL. Because the MDL trial docket lagged behind those in

state court cases in Texas, Riepen believes that the Texas

lawyers provided Class Counsel a “litigation road map...[:] At

the end of the day, the PMC only had to take depositions for a

few months ... before [Wyeth] initiated settlement discussions

with them [sic].” (Appellant’s Br., No. 08-2363, at 39.) 

Riepen is correct that the District Court did not mention

the Texas lawyers’ work in conjunction with this factor. That

does not mean, however, that the Court ignored the contributory

efforts of the Texas lawyers in determining an appropriate

percentage of recovery. The issue was litigated during both the

interim and final fee adjudication, and the Court determined

that, whatever the Texas cases may have added, the recoveries

arising from the MDL were due to the “herculean efforts” of the

PMC – in developing the case against Wyeth, in negotiating an 37

agreement that allowed Wyeth to resolve the claims against it,
 To the extent that Riepen makes the related argument 38

that the Gunter/Prudential factor of attorney skill and effort

does not support such a large award, the District Court has, as

noted above, said otherwise, and Riepen has not demonstrated

that the relevant findings are clearly erroneous. 

 “To say that this litigation was complex,” in the District 39

Court’s view, “is seriously to understate the fact.” Diet

Drugs, 553 F.Supp.2d at 475. The Court emphasized “the

complicated nature of this matter, and the constant challenges,

42

and in amending the Settlement Agreement when it appeared to

be in jeopardy. Diet Drugs, 553 F.Supp.2d at 474. 

38

But even if we agreed that the District Court undervalued

the Texas lawyers’ contributions – or if we agreed with any one

of Appellants’ discrete challenges – we would not, on that basis

alone, vacate the fee award. “The fee award reasonableness

factors ‘need not be applied in a formulaic way’ because each

case is different, ‘and in certain cases, one factor may outweigh

the rest.’” AT&T, 455 F.3d at 166 (quoting Rite Aid, 396 F.3d

at 301). Our task is to discern whether the Court’s percentageof-recovery analysis, when examined in its totality, supports the

fee that it finally determined was appropriate. 

The Court made numerous findings pertaining to the

Gunter/Prudential factors that Appellants do not dispute. For

instance, it found that (1) the work of Class Counsel yielded a

$6.44 billion settlement fund that benefitted more than 800,000

class members; (2) the Diet Drugs litigation was complex, and 39
many of them novel, which [Class Counsel] as well as this

court encountered year in and year out, and often day in and

day out.” Id. 

 In total, the Court considered nine such cases: In re 40

Tyco Int’l Ltd., 535 F.Supp.2d 249 (D.N.H. 2007); In re Royal

Ahold N.V. Sec. & ERISA Litig., 461 F.Supp.2d 383 (D. Md.

2006); In re AOL Time Warner, Inc. Sec. Litig., No. 02 Civ.

5575(SWK), 2006 WL 3057232 (S.D.N.Y. Oct. 25, 2006); In

re WorldCom, Inc. Sec. Litig., 388 F.Supp.2d 319 (S.D.N.Y.

2005); In re Visa Check/Mastermoney Antitrust Litig., 297

F.Supp.2d 503 (E.D.N.Y. 2003); Deloach v. Philip Morris

Cos., No. 1:00CV01235, 2003 WL 23094907 (M.D.N.C. Dec.

19, 2003); In re Sulzer Hip Prosthesis & Knee Prosthesis

Liab. Litig., 268 F.Supp.2d 907 (N.D. Ohio 2003); Shaw v.

Toshiba Am. Info. Sys., 91 F.Supp.2d 942 (E.D. Tex. 2000);

In re NASDAQ Market-Makers Antitrust Litig., 187 F.R.D.

465 (S.D.N.Y. 1998).

43

it endured significantly longer than did other super-mega-fund

cases; (3) Class Counsel had devoted an extraordinary amount 40

of time to the Settlement Agreement and the litigation

surrounding it; (4) the requested award was, in percentage terms,

slightly below the average award granted in the super-megafund cases; (5) the Major Filers’ consent to the joint fee petition

indicated that the petitioners were not seeking fees in excess of

market value; and (6) many of the Settlement Agreement’s

features – including the multiple downstream opt-out rights –

were innovative and “ha[d] already served as models for other
 We too noted the “potential significance” that the 41

Settlement Agreement’s innovations hold for future class

action settlements, Diet Drugs, 401 F.3d at 162 (3d Cir.

2005), as did at least one commentator, see Nagareda, supra,

115 Harv. L. Rev. at 797. The Settlement Agreement’s

potentially positive impact as a model for other cases appears

to be largely unrealized at this time. See, e.g., Richard A.

Nagareda, Mass Torts in a World of Settlement 147 (Chicago

2007) (acknowledging that scholars underestimated the

operational difficulties of the Diet Drugs settlement model);

McGovern, supra, at 1815 (“Most observers of mass torts

doubt that any other defendant will use a similar settlement

approach.”). However, the fact remains that Class Counsel

expended a great deal of effort to settle with Wyeth, and the

Settlement Agreement that the parties reached was innovative,

if perhaps not entirely worthy of imitation. 

 The District Court also performed a lodestar cross- 42

check, which we have recommended as a means of assessing

whether the percentage-of-recovery award is too high or too

low. E.g., Rite Aid, 396 F.3d at 306-07. While the Court

determined that the award represented 2.6 times the lodestar

value of Class Counsel’s work, it recognized that its

44

cases.” Diet Drugs, 553 F.Supp.2d at 472-85. On the basis of 41

those extensive – and uncontested – findings alone, we would

conclude that the District Court’s fee award was not an abuse of

discretion. As noted above, however, the aspects of the Court’s

analysis that Appellants challenge also support the percentageof-recovery award that Class Counsel received.42
multiplier was artificially low because the auditor’s report

included time expended on the MDL, in addition to time

expended on the Settlement Agreement. See infra Section

I.B.2. By Riepen’s calculation, the actual lodestar multiplier

is 3.4. Whether the multiplier is 2.6, 3.4, or somewhere in

that neighborhood, it is not problematically high. It is either

below or near the average mutliplier in the “super-mega-fund”

cases discussed by the District Court, id. at 486, and

consistent with our advice regarding appropriate multipliers,

see, e.g., Cendant PRIDES, 243 F.3d at 735-36, 742

(“strongly suggest[ing]” a multiplier of 3 as the ceiling for an

award in a simple case where “no risks pertaining to liability

or collection were pertinent”); Prudential, 148 F.3d at 341

(“[M]ultiples ranging from one to four are frequently awarded

in common fund cases when the lodestar method is applied.” 

(internal quotation and citation omitted)). 

 Riepen represented four initial opt-out clients. The 43

PMC disputes whether Valori represented any such clients

45

 C. Applicability of the MDL Assessments to

Appellants’ Cases

 Appellants argue that it was improper, under the

common benefits doctrine, for the Court to levy assessments

against their clients (1) who recovered against Wyeth on their

PPH claims, which were not covered by the Settlement

Agreement (“PPH clients”), and (2) who exercised initial optouts from the Settlement Agreement and recovered against

Wyeth independently (“initial opt-out clients”). In addition, 43
and, thus, whether he has standing to challenge the

assessments applied to initial opt-out and PPH recoveries. It

appears, however, that Valori represented at least one initial

opt-out plaintiff who settled her case against Wyeth, and

Valori asserted at argument that he represented PPH claimants

as well. We accept that Valori has standing.

 While the common benefit doctrine is distinct from the 44

common fund doctrine, the former derives from the latter. 

See Polonski v. Trump Taj Mahal, 137 F.3d 139, 145 (3d Cir.

1998) (“The origins of [the common benefit] doctrine can be

traced to the common fund rule whereby those who share in a

fund must participate in paying attorney’s fees when a

prevailing plaintiff's litigation redounds to the benefit of the

common fund.” (citing Hall v. Cole, 412 U.S. 1, 5 n. 7 (1973);

1 Dan B. Dobbs, Law of Remedies § 3.10(2) (2d ed. 1993)).

46

Riepen contends that the MDL assessment should not have been

levied against one of his client’s recoveries because the District

Court lacked subject matter jurisdiction over that client’s claims.

“Under the common benefit doctrine, an award of 44

attorney’s fees is appropriate where ‘the plaintiff’s successful

litigation confers a substantial benefit on the members of an

ascertainable class, and where the court’s jurisdiction over the

subject matter of the suit makes possible an award that will

operate to spread the costs proportionately among them.’”

Polonski, 137 F.3d at 145 (quoting Hall, 412 U.S. at 5). Thus,

in order to obtain common benefit fees, an attorney must confer

a substantial benefit to members of an ascertainable class, and
47

the court must ensure that the costs are proportionately spread

among that class. Id. Both Riepen and Valori argue that Class

Counsel conferred no benefit on their initial opt-out and PPH

clients. Valori also contends that the initial opt-out and PPH

plaintiffs bear a disproportionate burden of the assessment,

when compared with the downstream opt-out claimants. 

The PMC questions whether the common benefit doctrine

even applies in multidistrict litigations such as this one, and

suggests that the principal basis for the exercise of a district

court’s power to levy an assessment “derives from the docket

management powers of the federal judiciary.” (Appellees’ Br.,

No. 08-2363, at 57.) The Judicial Panel for Multidistrict

Litigation is empowered, under 28 U.S.C. § 1407, to transfer

related cases to a single court, and that court has – and is

expected to exercise – the ability to craft a plaintiffs’ leadership

organization to assist with case management. Inherent in that

ability, according to the PMC, is the power to fashion some way

of compensating the attorneys who provide class-wide services.

The PMC finds support for its position in In re Air Crash

Disaster at Fla. Everglades on Dec. 29, 1972, 549 F.2d 1006

(5th Cir. 1977). Like this case, Florida Everglades was a

multidistrict litigation in which, at the fee award stage, the MDL

court granted the plaintiffs’ management committee a fee award

drawn from the fees received by individual plaintiffs’ attorneys.

Id. at 1008-09. The United States Court of Appeals for the Fifth

Circuit concluded, over the appellants’ objection, that levying

such an assessment was within the District Court’s managerial

power:
48

Appellants approach the case as though it were

purely a private contest over fees between

competing lawyers. This approach is a nostalgic

luxury no longer available in the hard-pressed

federal courts. It overlooks the much larger

interests which arise in litigation such as this.

Each case in the consolidated case was private in

its inception. But the number and cumulative size

of the massed cases created a penumbra of classtype interest on the part of all litigants and of

public interest on the part of the court and the

world at large. The power of the court must be

assayed in this semi-public context.

Id. at 1012. 

The Fifth Circuit’s observations are apt and apply with

even greater force in this MDL, which dwarfed the size of

Florida Everglades, with hundreds of thousands of class

members spread all across the United States. That is not to say,

however, that the District Court can ignore basic principles of

fairness in applying an assessment. Florida Everglades is not to

the contrary. Indeed, the Fifth Circuit vacated the fee award and

remanded so that the district court could conduct a “hearing in

the full sense of the word” and enter findings of fact and

conclusions of law from which the court of appeals could

determine whether the award constituted a fair and just

enrichment of the plaintiffs’ committee, should the district

court’s decision be appealed. Id. at 1021. 
49

Likewise, we must ensure that the District Court granted

Class Counsel a just award in this case. Whether we do so by

applying the common benefits doctrine or independently

assessing whether the District Court properly exercised its

managerial power is of no real consequence. No matter how we

label our analysis, we must determine whether the Court abused

its discretion in concluding that Class Counsel conferred a

substantial benefit on the initial opt-out and PPH plaintiffs or in

how it spread the burden of the assessment among claimants

who recovered outside of the Settlement Agreement. 

1. Substantial Benefit

Appellants argue that their initial opt-out and PPH clients

did not enjoy a substantial benefit from the PMC’s services. By

Appellants’ lights, because those clients were not parties to the

Settlement Agreement, they did not receive any of the benefits

– such as medical testing or claims preservation – for which the

PMC bargained. And, although the PMC obtained class-wide

discovery to which all plaintiffs’ attorneys had access, Riepen

in particular contends that he did not use it in pursuing his initial

opt-out clients’ claims against Wyeth. Rather, he insists that the

only pre-existing discovery that he used to develop his initial

opt-out cases was procured by lawyers (including himself) in the

Texas state court cases against Wyeth. Valori is less clear about

whether he used the MDL discovery, but he nonetheless argues,

generally, that the PMC’s work product did not substantially

benefit his initial opt-out and PPH clients.

According to the District Court, however, the PMC

bestowed numerous benefits on initial opt-out and PPH
 Were we to credit Riepen’s argument, we would 45

provide an incentive for lawyers who represent individual

clients in an MDL to ignore the work product generated by

Class Counsel in favor of generating duplicative discovery,

and we would thereby undermine the efficiency gains that the

judicial system realizes from MDLs. 

 The District Court also noted that part of the assessment 46

was intended to reimburse the PMC for the fees that it paid to

the special discovery master. It was, according to the Court,

beyond dispute that the Special Master’s extraordinary

services had benefitted all MDL claimants. Appellants do not

dispute that finding. 

50

claimants, even if their attorneys did not use the discovery that

the PMC marshaled and retained. The mere availability of the

discovery, in the Court’s words, “substantially influenced

[Wyeth’s] evaluation of every plaintiff[’]s case.” (App. at 45

1194 (emphasis added).) More tangibly, the Court found that

the PMC had, to the benefit of every claimant, helped to

administer the MDL by tracking individual cases, distributing

court orders, and serving as a repository of information

concerning the litigation and settlement. Diet Drugs, 553

F.Supp.2d at 493. Furthermore, it obtained a number of

favorable discovery and evidentiary rulings that applied on a

litigation-wide basis, and it enforced a uniform procedure for the

production of documents, deposition testimony, and expert

disclosures that governed every MDL case against Wyeth. 

46
 We do not mean to imply that the existence of a 47

settlement agreement by itself constitutes a substantial benefit

to opt-out claimants in every class action. This case presented

a unique set of circumstances – the staggering amount of

liability that Wyeth faced, the quality and quantity of the

discovery that the PMC amassed, and the speed with which

Wyeth and Class Counsel reached a settlement – that severely

weakened Wyeth’s bargaining position against PPH and

initial opt-out claimants. The District Court did not abuse its

discretion in deciding that the PMC deserves to be

compensated for increasing those claimants’ leverage against

Wyeth. 

51

Appellants do not contest any of those findings, and each

has substantial support in the record. We think it beyond

reasonable denial that the initial opt-out and PPH claimants

benefitted from Wyeth’s loss of bargaining power due to the

PMC’s efforts. As the District Court noted, Wyeth had to

defend itself against the initial opt-out and PPH claimants

knowing that they had access to pertinent discovery and

understanding that they, in turn, knew Wyeth was heavily

invested in settling. It stands to reason, then, that those

plaintiffs stood a better chance of recovery from Wyeth than

they would have absent the PMC’s efforts. Thus, the PMC

conferred a substantial benefit on the initial opt-out and PPH

claimants.

47
 Our dissenting colleague proposes that we order the 48

District Court to recoup the refunds that the downstream optout claimants received when their assessments were reduced

from 6% & 4% to 2% & 1.33 %, and to redistribute those

funds pro rata among the downstream opt-out claimants, the

initial opt-out claimants, and the PPH claimants. To the

extent that Valori specifically asked for that relief, he did so

in his reply brief (see Appellant’s Rep. Br., No. 08-2387, at

13) (“What the district court should have done ... was to

recognize that, to the extent money dedicated to pay Class

Counsel and the PMC due to the class action settlement

should be credited toward paying the assessments against any

opt-outs ..., the credits should be applied equally across all

categories of opt-outs.)) and we do not think it well-advised,

especially in evaluating a settlement with as many moving

parts as this one has, to consider a remedy not requested until

that point. See In re Surrick, 338 F.3d 224, 237 (3d Cir. 2003)

(Failing to argue an issue in one’s opening brief constitutes

waiver of the argument on appeal). Had the recommendation

been timely proposed, it could have been tested by the

adversary process and its ramifications could have been

thoroughly considered. That did not happen, and thus we

cannot agree that ordering relief which apparently was

suggested as an afterthought is an appropriate step now.

52

2. Proportionality

Valori argues that the burden of the assessment fell

disproportionately on the initial opt-out and PPH claimants and

that the fee award must be vacated on that basis. As he notes, 48
 Recall that the 6% & 4% Assessment was designed to 49

reward Class Counsel for work that benefitted all claimants,

including those who recovered from Wyeth outside of the

context of the Settlement Agreement. Recoveries by

claimants who were originally part of the MDL were assessed

at a rate of 6%, while 4% assessments were levied against

claimants who recovered in coordinated state actions. 

53

a 6% & 4% Assessment was levied against all opt-out 49

recoveries pursuant to the interim fee award, but, as applied to

downstream opt-out claimants, the Court, in its final analysis,

accepted the PMC’s recommendation that the assessment be

reduced to 2% & 1.33%. The PMC explained the logic behind

the disparate assessments thusly: Downstream opt-out claimants,

as opposed to initial opt-out and PPH claimants, recovered in

part because of the Settlement Agreement. The medical

monitoring that Wyeth paid for allowed them to establish their

injuries, and, without the claims preservation terms to which

Wyeth agreed, they may have been frozen out of the tort system.

Therefore, part of the fee award drawn from downstream opt-out

recoveries came out of the Settlement Accounts and the

assessments from the MDL Fee and Cost Account were reduced

accordingly. The reduction prevented Class Counsel from being

paid twice for the benefits conferred on the downstream opt-out

claimants. 

That the PMC created, and the District Court approved,

a “prophylactic against ‘double dipping’” is laudable.

(Appellee’s Br., No. 08-2387, at 25.) However, it is also a nonsequitur as a response to Valori’s contention that the burden of
 We cannot agree, however, with Valori’s suggestion 50

that the Major Filers, many of whom represented downstream

opt-out claimants, refrained from objecting to the assessments

only because they received additional compensation that is not

reflected in the agreements submitted to the District Court. 

(Appellant’s Br., No. 08-2387, at 36 and n.18.) Class Counsel

and the Major Filers agreed that there were no other

“agreements, promises, or undertakings” among them (App.

at 13023) and the Court found, as a matter of fact, that there

were no such secret deals in place. Diet Drugs, 553

F.Supp.2d at 483. Valori has pointed to no evidence that

indicates the Court’s finding is clearly erroneous, and we rely

on that finding. 

The dissent would hold that the District Court abused

its discretion in not applying “extra scrutiny” to the Major

Filer Agreements, which are said to benefit the Major Filers at

the expense of attorneys for the initial opt-out and PPH

claimants. (Dissenting Op. at 73.) To rule as the dissent

suggests, however, would undermine the abuse-of-discretion

standard.

The boundaries set by that particularly deferential

standard of review can be difficult to discern at times, but the

standard ought to mean at least that an appellate court’s

54

the fee award was not allocated proportionately to the benefits

that each group of claimants received. Unlike the other aspects

of the District Court’s well-reasoned opinion that we have

already addressed, its logic regarding the assessments, as

allocated between the downstream opt-out claimants and the

initial opt-out and PPH claimants, is assailable. Even if we 50
suspicions alone cannot override a finding of fact made by a

district court judge who has managed the case for years and

developed the record being reviewed.

55

credit the math employed by the PMC and the District Court and

assume that, despite the disparate assessments, all opt-out and

PPH claimants paid a roughly equal portion of the fee award,

there is a sound argument that the downstream opt-out claimants

received, for the same price, a greater tangible benefit from

Class Counsel’s services than the initial opt-out and PPH

claimants received. 

The inquiry we must make, however, is not whether a

portion of the District Court’s logic is subject to criticism, but

whether the fee award itself constitutes an abuse of discretion.

Certainly, limits on the reasoning behind an award may lead to

the conclusion that the award itself cannot stand. But when, as

in this case, the result can otherwise be justified, we are not

compelled to find an abuse of discretion. Cf. In re Nortel

Networks Corp. Sec. Litig., 539 F.3d 129, 134 (2d Cir. 2008)

(approving fee award even though the district court neglected to

use awards granted in similar cases as benchmarks). We look,

then, to the basis of Valori’s proportionality attack to see

whether the District Court’s order can be justified in spite of the

attack.
 Our dissenting colleague charges that, in assessing the 51

proportionality of the fee award under Boeing, we have

applied the wrong body of law. As the dissent acknowledges,

however, it is Valori who contended that the fee award

violates the principles espoused in Boeing. Rather than

selecting that decision as the law to apply, we have simply

responded to the argument presented to us. Like the dissent,

we have recognized that the common fund rule and the

common benefit doctrine are distinct and, indeed, different in

nuanced ways. See supra n. 44. In this case, though, the

differences do not help Valori. The dissent is correct that in

Polonski, we observed that the common benefit doctrine, as

originally formulated, required the district court to “ensure

that costs are proportionally spread among the class.” 137

F.3d at 145 (citing Hall v. Cole, 412 U.S. 1, 5 (1973). We

also noted, however, that we had “refined” the language of

the test so that we now ask “whether the benefits may be

traced with some accuracy ... [and] whether there is a

reasonable basis for confidence that the costs may be shifted

with some precision to those benefitting.” Id. (citing

Marshall v. United Steelworkers, 666 F.2d 845, 848 (3d Cir.

1981)). That language is substantially similar to the Boeing

requirements, which, for the reasons stated below, are

satisfied here.

56

Valori contends that the District Court violated the

principles espoused in Boeing, 444 U.S. 472. In Boeing, the 51

Supreme Court asserted that it is proper to award fees to a

common benefits attorney only where “the benefits of class

recovery have ‘been traced with some accuracy’ and the costs of
 We do not imply that there are no limits on how the 52

burden of a fee assessment may be distributed among

individuals or subclasses who have received a common

benefit. Basic concerns for fairness and due process always

circumscribe judicial discretion, but those concerns and the

message of Boeing do not prohibit the result reached by the

District Court here.

 Nor do we ask whether the individual lawyers who 53

represented the downstream opt-out claimants, on one hand,

and the lawyers for initial opt-out and PPH claimants, on the

other, were equally burdened by Class Counsel’s fees. The

operative question is whether the costs of recovery were

“shifted with some exactitude” to the beneficiaries of Class

Counsel’s efforts – i.e., the parties who recovered from

57

recovery have been ‘shifted with some exactitude to those

benefiting.’” Id. at 480-81 (quoting Alyeska Pipeline, 421 U.S.

at 265 n.39). However, neither Boeing nor any other authority

requires courts to ensure that the “costs of recovery” are shifted

with exactitude among the various subclasses of claimants who

benefitted from class counsel’s efforts. Boeing and the other

cases defining the contours of the common fund doctrine

mandate only that the fee awarded to class counsel was

reasonable given the benefit that these attorneys provided to the

class members.52

Under Boeing, the pertinent question is not what the

initial opt-out and PPH claimant paid in fees relative to what the

downstream opt-out claimants paid. Rather, it is whether the 53
Wyeth. See Vincent v. Hughes Air West, Inc., 557 F.2d 759,

770 (9th Cir. 1977) (approving fee award for class counsel

drawn from individual claimants’ attorneys in part because it

was proportionate to the benefit class counsel provided to the

claimants). 

 We note that in rejecting Valori’s proportionality

54

objection, the District Court did observe, “the necessity to

consider separately any awards under the Class Action

Settlement and any award from the MDL ... Fee and Cost

Account[,]” and the fact that “[t]he Class Action Settlement

and the MDL play significantly different roles and cannot

really be compared.” Diet Drugs, 553 F.Supp.2d at 495. To

the extent the District Court was concluding, as we do, that

the overriding question is not one of comparison among the

various categories of settling plaintiffs but instead is fairness

within the categories and overall fairness, we entirely agree

with that logic.

58

initial opt-out and PPH claimants paid, in an absolute sense, a

fair amount for the benefit of Class Counsel’s services. The 54

answer to that question, in our view, is a definite “yes.” As

noted above, the District Court found that Class Counsel

substantially enhanced all claimants’ chances for recovery by

amassing meaningful discovery, drawing Wyeth to the

bargaining table, and negotiating with Wyeth a comprehensive

settlement that evinced the company’s acute interest in resolving

the claims against it. Appellants have not demonstrated that

these findings were clearly erroneous. Indeed, they are amply

supported by the record. Given all that the initial opt-out and
59

PPH claimants received, the 6% & 4% Assessment levied on

their recoveries was reasonable, and, thus, it satisfies Boeing’s

charge that costs and benefits be traced with some accuracy.

Any lingering concern that the fee award imposed a

disproportionately heavy burden on the initial opt-out and PPH

claimants shrinks when the proportionality issue is considered

in the context of the fee award as a whole. Allocating the

burden of the award among the claimants was but one part of the

extraordinarily complicated endeavor of determining an

appropriate award in this massive MDL. Even the discrete

question of how to allocate the award was fraught with complex

considerations, including how to treat the downstream opt-out

claimants, who recovered outside the context of the settlement

but still received valuable benefits under the Settlement

Agreement, and what measures, if any, should be used to

prevent Class Counsel from over-recovering – via the

assessments and the Settlement Accounts – for their services

that benefitted the downstream opt-out claimants. It would, in

this case, be unwise to vacate the entire award based solely on

how it was allocated, when the award is persuasively justified in

all other respects and is justifiable in this one problematic

respect. 

Moreover, even if we were inclined to vacate the fee

award based on the allocation, it is not clear to us that Valori’s

requested relief – a remand to the District Court with

instructions to reallocate the award – would be feasible.

Reducing the assessment on the downstream opt-out recoveries

required the District Court to order refunds totaling more than
60

$52 million to numerous law firms that, by prior court order, had

paid the 6% & 4% Assessments into the MDL Fee and Cost

Account. Months later, those refunds are not likely to be sitting

in the bank accounts of the law firms that received them. It

seems likely that taxes have been paid, referral counsel has been

compensated, and, generally speaking, the refunds have, in all

or in part, worked their way through the channels of commerce

and, accordingly, would be difficult for the Court to reclaim.

We also find it significant – and surprising – that Valori,

who has argued so vigorously that the allocation is unfair, never

sought a stay of the refund distribution pending appeal. Had

Valori moved for a stay, and had the Court granted his motion,

the practical difficulties associated with administering the

redistribution that he requests would be alleviated. When

pressed on the matter during oral argument, Valori asserted that,

in order to request a stay, he would have had to post a

supersedeas bond – a bond that, given the enormous amount of

money at issue in this case, he would not have been able to

afford – so the Court probably would not have granted his

request anyway. That defeatist stance is too convenient an

excuse. Although Fed. R. Civ. P. 62(d) states that “[i]f an

appeal is taken, the appellant may obtain a stay by supersedeas

bond,” courts may forego that requirement when there are other

means to secure the judgment creditor’s interests. See, e.g.,

Arban v. West Pub. Corp., 345 F.3d 390, 409 (6th Cir. 2003)

(expressing the view that Rule 62(d), which speaks to stays

granted as a matter of right, does not constrain district courts

from granting stays in accordance with their discretion); Fed.

Prescription Serv., Inc. v. Am. Pharm. Ass’n, 636 F.2d 755, 759

(D.C. Cir. 1980) (same); Munoz v. City of Phila., 537 F.Supp.2d
 We therefore have no occasion to decide whether the 55

doctrine of equitable mootness, which “dictates that an appeal

should be dismissed, even if a court has jurisdiction and is in

a position to grant relief, if ‘implementation of that relief

would be inequitable,’” In re Zenith Electronics Corp., 329

F.3d 338, 343 (3d Cir. 2003) (quoting In re PWS Holding

Corp., 228 F.3d 224, 236 (3d Cir. 2000)), applies outside the

bankruptcy context in which it is typically invoked or, more

specifically, to a case such as this one. 

61

749, 751-52 (E.D. Pa. 2008) (granting a stay without requiring

a bond where the movant had sufficient funds to pay the

judgment against it and there was “no basis to think that prompt

payment [would] not take place should the judgment be

sustained on appeal”). Here, the assessments and fees awarded

pursuant to the Settlement Agreement were maintained in

escrow accounts under the District Court’s control. It is

therefore quite possible, perhaps even likely, that the Court

would have waived the bond requirement or required a

substantially reduced bond in this case. All of that being said,

we need not decide whether practical difficulties in

administering a reallocation, or Valori’s inaction in attempting

to mitigate those difficulties, foreclose us from remanding the

matter. As noted above, we do not believe that the District 55

Court’s allocation, viewed in context, constitutes an abuse of

discretion. 
 It is unclear from the record why the District Court 56

ruled on Harris’s motion to remand after dismissing the case. 

62

3. Assessment on the Harris Case 

According to Riepen, the MDL assessment, even if

properly applied to the initial opt-out and PPH plaintiffs, should

not have been applied to the recovery of his client Jana Harris

because her case did not belong in federal court in the first

place. In February 1999, Riepen field suit in a Kansas state

court on the behalf of Harris, a citizen of Kansas. Among the

defendants named in the suit was a pharmacy with its principal

place of business in Kansas. Wyeth argued that the pharmacy

was fraudulently joined to defeat removal, and it proceeded to

file a notice of removal to shift the case to federal court.

Riepen’s co-counsel filed a motion to remand, but before the

United States District Court for the District of Kansas could rule

on the motion, the case was transferred to the Eastern District of

Pennsylvania as part of the MDL. Harris settled her case with

Wyeth, and the case was dismissed with prejudice pursuant to a

motion that Riepen did not oppose, before the District Court

denied the remand motion on December 7, 2000. 

56

“It is well-settled law that subject matter jurisdiction can

be challenged at any point before final judgment,” In re Kaiser

Group Intern. Inc., 399 F.3d 558, 565 (3d Cir. 2005) (citation

omitted), but the necessary corollary is that subject matter

cannot be challenged after such judgment is entered. See Hodge

v. Hodge, 621 F.2d 590, 592 (3d Cir. 1980) (“It was settled long
 It is irrelevant whether, as Riepen claims, he properly 57

preserved the jurisdictional issue for appeal. This is not a

matter of waiver. Rather, the question is whether the District

Court’s subject matter jurisdiction over Harris’s case can be

challenged at all at this stage of litigation, and the answer is it

cannot. 

63

ago ... that when a federal court proceeds to final judgment on

the merits, the issue of subject matter jurisdiction is res judicata

even though it was not litigated ... .” (citation omitted)). Here,

final judgment was entered in Harris’s case when the District

Court dismissed it with prejudice. 

Riepen argues that the matter is still open because the

District Court retained the ability to exempt him from the

assessment until it issued its final, appealable attorneys’ fee

order in July 2008. But authority from the Supreme Court and

our Court makes clear that a decision on the merits is separate

from orders regarding attorneys’ fees for the purposes of finality

and appealability. See White v. N.H. Dept. of Employment Sec.,

455 U.S. 445, 451-52 (1982) (“[A] request for attorney’s fees ...

raises legal issues collateral to” and “separate from” the decision

on the merits.); In re Colon, 941 F.2d 242, 245 (3d Cir. 1991)

(“treat[ing] attorneys’ fees apart from the merits for purposes of

appeal”). Thus, while Riepen may challenge the attorneys’ fees

and cost assessments that were imposed on him, he cannot do so

by attacking subject matter jurisdiction on a case that was

dismissed with prejudice almost ten years ago. 

57
64

III. Conclusion

The District Court set forth its reasoning in support of the

fee award in a careful opinion that gives us a more than

sufficient basis for review. It employed transparent procedures

and undertook a thorough and proper analysis – based on the

appropriate information – in determining the award. Given the

duration of the litigation and the extraordinary efforts of Class

Counsel, the amount of the award, though extraordinarily large,

is not excessive in this extraordinary case, and while we have

some reservations about the allocation of the assessments

between the downstream opt-out claimants and the initial optout and PPH claimants, we do not believe the Court abused its

discretion in apportioning the award as it did. We will therefore

affirm the final fee award. 
65

AMBRO, Circuit Judge, dissenting in part

I join Judge Jordan’s excellent opinion on all points save

one—I believe the District Court abused its discretion in

assessing the “downstream opt-out” plaintiffs at a lower rate for

the case-wide services provided by the plaintiffs’ management

committee (the “PMC”) than it assessed the “initial opt-out” and

primary pulmonary hypertension (“PPH”) plaintiffs. I would

therefore grant the request of appellants—Freedland, Farmer,

Russo, Behren & Sheller and Raymond Valori P.A. (collectively

“Valori”)—to vacate the District Court’s order refunding fees

exclusively to the downstream opt-out plaintiffs, and remand so

that the refunds can be redistributed pro rata to all plaintiffs

charged for the PMC’s services.

To review, the District Court awarded Class Counsel

attorneys’ fees for assisting in the recoveries of two separate sets

of plaintiffs whom its members did not represent: (1) plaintiffs

who recovered within the class action (recoveries that essentially

involved proving eligibility for the various funds created by the

Settlement Agreement and its subsequent amendments); and (2)

plaintiffs who recovered outside the class action (but whose

recoveries were, according to the District Court, aided

substantially by the PMC’s case-wide services). The latter set

of plaintiffs included three different groups: PPH plaintiffs

(whose claims were not covered by the Settlement Agreement),

initial opt-out plaintiffs (who opted out of the class action

entirely and pursued individual tort actions against Wyeth), and

downstream opt-out plaintiffs (who exercised their opt-out

rights after receiving some benefits from the Settlement
 The 9% and 6% assessments were levied exclusively 58

on plaintiffs who had recovered outside the class action.

 For ease of reference, I refer hereafter to these 59

assessments as the “PMC fees.”

 Initially, Class Counsel argued that all of the PMC fees

60

assessed against the downstream opt-out plaintiffs should be

rebated. For the reasons discussed below, the District Court

rejected that aspect of the proposal.

66

Agreement and with respect to whom Wyeth agreed, as part of

the Settlement Agreement, to relinquish any statute-oflimitations defenses in exchange for those plaintiffs being barred

from seeking punitive damages).

In 1998, the District Court ordered Wyeth to withhold 9%

of all payments made to federal diet drug plaintiffs (whose cases

had passed through that Court pursuant to the directions of the

Judicial Panel for Multidistrict Litigation) and 6% of all

payments made to plaintiffs in coordinated state cases. The 58

money withheld was placed into the “MDL Fee and Cost

Account,” with the idea that it would later be used to

compensate Class Counsel for the PMC’s case-wide services.59

In 2002, the Court lowered those percentages to 6% and 4%,

respectively. In 2008 (in one of the orders before us now), the

Court ratified Class Counsel’s proposal to refund a portion of

the downstream opt-out plaintiffs’ PMC fees while refunding

nothing to the initial opt-out or PPH plaintiffs. The result of 60

that refund was that the downstream opt-out plaintiffs ended up
 The Court’s rationale for attributing half of the 61

recovery of the downstream opt-out plaintiffs to the

Settlement Agreement was that, because the Settlement

secured a waiver from Wyeth of any statute of limitations

67

assessed at rates of (respectively) 2% and 1.33%, while the other

plaintiffs subject to PMC fees were kept at 6% and 4%. Class

Counsel made the refund proposal pursuant to an agreement it

had reached prior to submitting its final fee petition with the socalled “Major Filers,” a group that included lawyers for

approximately 97% of the downstream opt-out plaintiffs (along

with lawyers for a large number of plaintiffs who recovered

within the class action). As part of that agreement, the Major

Filers pledged to refrain from lodging any objections to Class

Counsel’s subsequent fee petition.

On its face, it seems suspicious that the one group that

was charged less for the PMC’s class-wide services also

happened to be the one group that reached an outside deal with

Class Counsel. Nonetheless, the District Court justified

subjecting the downstream opt-out plaintiffs to the lower

assessment through the following chain of reasoning. It

reasoned, first, that, because the purpose of the PMC fees was

to compensate Class Counsel for benefits provided to those who

recovered outside the Settlement Agreement, it could not assess

PMC fees on recoveries that were the product of the Settlement

Agreement. The Court then inferred that, because in calculating

the value of the Settlement Agreement it had credited that

Agreement with producing half of the $2.3 billion recovered by

the downstream opt-out plaintiffs, it would be improper for 61
defenses against the downstream opt-out plaintiffs, this was

substantially responsible for those recoveries, even though

they technically occurred outside the framework of the

Settlement.

 The one exception is that, as mentioned in note 60 62

above, the fee petition urged the District Court to attribute all

of the downstream opt-out plaintiffs’ recovery to the

Settlement Agreement and, accordingly, to rebate all of the

PMC fees assessed on those plaintiffs. Because the Court

determined that only half of the downstream opt-out

plaintiffs’ recovery could fairly be credited to the Settlement

Agreement, it did not go as far as urged by Class Counsel.

68

Class Counsel to receive PMC fees corresponding to the full

amount recovered by the downstream opt-out plaintiffs. From

that, the Court concluded that it should refund the excess back

to the downstream opt-out plaintiffs. In taking this path, the

District Court was (largely) adopting the reasoning that Class

Counsel had laid out in its fee petition.62

As the majority recognizes, every step in the District

Court’s reasoning makes sense, except the last. It is true that

Class Counsel’s award for the Settlement Agreement included

compensation for creating half the value recovered by the

downstream opt-outs plaintiffs. But the money to fund that

compensation did not come out of the downstream opt-out

plaintiffs’ recovery (even though it was compensation for

enabling part of that recovery). Rather, as Class Counsel

conceded during oral argument, that money came out of the
 As the majority notes, Class Counsel contends that, in

63

the end, the downstream opt-out plaintiffs were essentially

charged the same as the initial opt-out and PPH plaintiffs,

albeit through a different route. I am skeptical. For that to

have happened, Wyeth, in settling the downstream opt-out

cases, needed to have priced in the attorneys’ fees that would

later be taken out of the Fund A Legal Fees Escrow Account

to compensate Class Counsel for half of the value of those

settlements. As Wyeth had no way of knowing at the time

that fees would be assessed in that manner, I find Class

Counsel’s contention unconvincing (to say the least).

69

$200 million Wyeth deposited into the Fund A Legal Fees

Escrow Account. Accordingly, while it was appropriate for the

Court to be concerned about authorizing double dipping (by

allowing Class Counsel to recover twice, in two different

capacities, for enabling the same recovery), there was no

corresponding danger that the downstream opt-out plaintiffs

would be double-charged. As such, the effect of the District

Court’s refund order was that the downstream opt-out plaintiffs

ended up being charged less for the PMC’s case-wide services

than were the other groups subject to PMC fees, despite the 63

fact that the downstream opt-out plaintiffs received no fewer

benefits from those services, and, overall, certainly received

more from the efforts of Class Counsel (since they benefitted

both from the Settlement Agreement and the PMC’s services).

The majority nonetheless holds that it was not an abuse

of discretion for the District Court to order the excess PMC fees

refunded solely to the downstream opt-out plaintiffs, rather than
 My colleagues concede that “[b]asic concerns for 64

fairness and due process always circumscribe judicial

discretion . . . .” Maj. Op. at 57 n.52. Their point is, I

believe, that there is nothing in the doctrine justifying the

assessment of the PMC fees that requires the kind of

proportionality demanded by Valori. As explained below, I

disagree.

70

(as Valori urges us to do here) distributing the refunds among all

those assessed such fees. The majority’s reasoning essentially

is that the applicable body of law merely requires that the fees

assessed against a particular beneficiary be proportional to what

that beneficiary received, not that the fees be proportional to

those assessed against other beneficiaries. On that basis, the

majority concludes that there was no abuse of discretion here

because the PMC fees assessed against the initial opt-out and

PPH plaintiffs were proportional to the benefits they received

from the PMC’s case-wide services, leaving those groups with

basically no cause for complaint.

I agree that, viewed from the vantage point merely of the

particular benefits the initial opt-out and PPH plaintiffs

received, the PMC fees assessed against them were fair. I

disagree, however, that that is the only legally relevant vantage

point.64

For starters, I believe that the majority applied the wrong

body of law. They derive their conclusion from Boeing Co. v.

Van Gemert, 444 U.S. 472 (1980), a case that lays out the

contours of the “common fund doctrine.” Boeing, as the
 I do, however, believe that such a requirement is 65

implicit in Boeing based on the following two passages. First,

in explaining the rationale for the common fund doctrine, the

Boeing Court reasoned this way:

The [common fund] doctrine rests on the

perception that persons who obtain the benefit

of a lawsuit without contributing to its costs are

unjustly enriched at the successful litigant’s

expense. Jurisdiction over the fund involved in

the litigation allows a court to prevent this

inequity by assessing attorney[s’] fees against

the entire fund, thus spreading fees

proportionally among those benefitted by the

suit.

444 U.S. at 478 (emphasis added) (internal citation omitted). 

Second, in explaining how the doctrine works in practice, the

Court provided this account:

Although the full value of the benefit to each

absentee [class] member cannot be determined

until he presents his claim, a fee awarded

against the entire . . . fund will shift the costs of

litigation to each absentee in the exact

71

majority notes, does not articulate an explicit requirement that

a district court, in awarding attorneys’ fees, ensure that those

fees are allocated proportionally across the entire class of

beneficiaries. Yet the PMC fees were not assessed pursuant to 65
proportion that the value of his claim bears to

the total recovery.

Id. at 479 (emphasis added). It will only be the case that each

class member who accesses a common fund will be charged

in “exact proportion that the value of his claim bears to the

total recovery” if every class member’s recovery from the

fund is assessed at the same rate (since that is the only way to

ensure that a class member who recovers more than another

class member will necessarily pay more in fees). Thus, even

were it the case that Boeing applied to the PMC fees (which it

does not), the disproportional allocation of those fees would

still, I believe, be an abuse of discretion.

 In fairness to the majority, Valori did cite Boeing in 66

support of its proportionality argument.

72

the common fund doctrine. That doctrine applies only where 66

(as in the case of the award for the Settlement Agreement) fees

are being awarded as compensation for giving “each member of

a certified class . . . an undisputed and mathematically

ascertainable claim to part of a lump-sum.” Id. at 479. The

PMC fees, on the other hand, were not awarded for creating a

fund from which the different opt-out and PPH plaintiffs

recovered. Rather, they were awarded for creating diffuse, nonmonetary, benefits (e.g., discovery materials, drawing Wyeth to

the bargaining table, etc.) that helped those plaintiffs recover

outside the class action. As such, they were awarded pursuant

to the “common benefit doctrine,” which requires only that the

party receiving the attorneys’ fees have conferred a “substantial
 My view does not change even if, as Class Counsel 67

urges, we think of the PMC fees as having been assessed

pursuant to the District Court’s broad managerial powers,

rather than the common benefit doctrine. Because assessing

fees such as the ones at issue here involves charging litigants

for benefits they may have only involuntarily received, I

believe the fairness concerns that always cabin a district

court’s discretion weigh especially heavily in this context. I

would thus find an abuse of discretion even were we to

conclude that the fees were assessed under neither the

common fund doctrine nor the common benefit doctrine.

73

benefit” on “members of an ascertainable class,” not that the

benefit it conferred creates a recovery fund. Polonski v. Trump

Taj Mahal Assocs., 137 F.3d 139, 145 (3d Cir. 1998).

The reason this distinction matters is that it is an explicit

requirement of the common benefit doctrine that, in awarding

fees, a “court . . . ensure that the costs are proportionally spread

among that class.” Id. The District Court failed to do that here,

and, accordingly, I believe it abused its discretion.67

In addition, I am more troubled than my colleagues that

the District Court arrived at the lower rate of assessment for the

downstream opt-out plaintiffs in response to an agreement

reached between Class Counsel and a group, the Major Filers,

that included almost all the downstream opt-out plaintiffs. I

believe that, presented with a proposal that benefitted a group

that was a party to the proposal (the downstream opt-out

plaintiffs) at the expense of group that was not a party to it (the
74

initial opt-out and PPH plaintiffs), the District Court was

required to subject that proposal to extra scrutiny. That the

District Court adopted Class Counsel’s flawed reasoning more

or less in full suggests to me that such scrutiny was not applied.

That, too, was an abuse of discretion.

My suspicion is that what is driving the majority’s

reluctance to find an abuse of discretion here (despite agreeing

that the District Court’s reasoning was flawed) is its belief that

it would be a shame “to vacate the entire award based solely on

how it was allocated, when the award is persuasively justified in

all other respects.” Maj. Op. at 59. I share the view that the

problem I am focusing on represents, at most, a minor blemish

in the District Court’s otherwise excellent, and persuasive,

treatment of an extraordinarily difficult case. But I do not agree

that rectifying the disproportionate allocation of the PMC fees

requires anything so drastic as vacating the entire award. All

that needs to be vacated is the separate order refunding the

excess PMC fees exclusively to the downstream opt-out

plaintiffs. That would leave the entire award to Class

Counsel—both the $434,511,777.33 it received for the

Settlement Agreement and the $133,161,455 it received in PMC

fees—untouched.

I agree that there might be some administrative

difficulties associated with reclaiming the $52 million in PMC

fees that were already refunded to the downstream opt-out

plaintiffs. I too share the majority’s frustration with Valori’s

failure to request a stay of the distribution order he later

challenged on appeal. I do not, however, consider such

problems insoluble, since we deal here with purely fungible
75

assets—money. For that reason, I consider wholly inappropriate

Class Counsel’s suggestion—wisely sidestepped by the

majority, Maj. Op. at 61 n.55—that we extend beyond the

bankruptcy context the controversial doctrine of equitable

mootness, which applies only to attempts to “unscrambl[e]

complex bankruptcy reorganizations,” and even then “‘is limited

in scope and should be cautiously applied.’” Nordhoff Invs., Inc.

v. Zenith Elecs. Corp., 258 F.3d 180, 185 (3d Cir. 2001)

(quoting In re PWS Holding Corp., 228 F.3d 224, 236 (3d Cir.

2000)).

In sum, I would vacate the order refunding the excess

PMC fees exclusively to the downstream opt-out plaintiffs and

remand with instructions that the excess be redistributed pro

rata to all plaintiffs assessed such fees. Because the majority

would affirm the District Court in all aspects, I respectfully

dissent as to this issue only.