Opinion ID: 1428164
Heading Depth: 3
Heading Rank: 1

Heading: Attorneys' Fees for Class Counsel

Text: With respect to a district court's ruling on a fee application, [w]hat constitutes a reasonable fee is properly committed to the sound discretion of the district court and will not be overturned absent an abuse of discretion, such as a mistake of law or a clearly erroneous factual finding. Goldberger v. Integrated Res., Inc., 209 F.3d 43, 47 (2d Cir.2000) (internal citation omitted); see Jones v. UNUM Life Ins. Co. of Am., 223 F.3d 130, 138 (2d Cir.2000). The Supreme Court has held that when a representative plaintiff successfully establishes or protects a fund in which the other class members have a beneficial interest, the costs of litigation may be distributed among the fund's beneficiaries. See Mills v. Elec. Auto-Lite Co., 396 U.S. 375, 390-95, 90 S.Ct. 616, 24 L.Ed.2d 593 (1970). Moreover, under the equitable fund doctrine, attorneys for the successful party may petition for a portion of the fund as compensation for their efforts: [A] litigant or lawyer who recovers a common fund for the benefit of persons other than himself or his client is entitled to a reasonable attorney's fee from the fund as a whole. Boeing Co. v. Van Gemert, 444 U.S. 472, 478, 100 S.Ct. 745, 62 L.Ed.2d 676 (1980). In common fund cases, courts typically use either the lodestar method or the percentage method to compute attorneys' fees. The lodestar method multiplies the numbers of hours expended by each attorney involved in each type of work on the case by the hourly rate normally charged for similar work by attorneys of like skill in the area and, once this base or lodestar rate is established, . . . [the court] determine[s] the final fee by then deciding whether to take into account other less objective factors, such as the risk of litigation, the complexity of the issues, and the skill of the attorneys. Savoie v. Merchants Bank, 166 F.3d 456, 460 (2d Cir.1999) (internal citations and quotation marks omitted). The percentage method, by contrast, calculates the fee award as some percentage of the settlement fund created for the benefit of the class. See Masters v. Wilhelmina Model Agency, Inc., 473 F.3d 423, 436 (2d Cir. 2007). This Court has observed that the fee awarded must reflect the actual effort made by the attorney to benefit the class and that a court is to act as a fiduciary who must serve as a guardian of the rights of absent class members. City of Detroit v. Grinnell Corp., 560 F.2d 1093, 1099 (2d Cir.1977) (internal quotation marks omitted), abrogated on other grounds, Goldberger, 209 F.3d 43. Moreover, [d]istrict courts should continue to be guided by the traditional criteria in determining a reasonable common fund fee, including: (1) the time and labor expended by counsel; (2) the magnitude and complexities of the litigation; (3) the risk of the litigation . . .; (4) the quality of representation; (5) the requested fee in relation to the settlement; and (6) public policy considerations. Goldberger, 209 F.3d at 50 (internal quotation marks omitted). Applying these criteria, the District Court determined that the fee application requesting 30% of the settlement fund was reasonable. See In re: Medco Health Solutions, Inc., 2004 WL 1243873, at . The District Court applied the Goldberger test and made specific and detailed findings from the record, as well as from its own familiarity with the case, including the fact that counsel expended substantial time and effort in the litigation, that the case was litigated on a purely contingent basis, and that the fee award was 30% of the fund as permitted by the Settlement Agreement. See id. at -11. Accordingly, we find no reason to disturb the District Court's approval of class counsel's application. We note in passing that counsel retained to represent the interests of the new subclass on remand also may be entitled to recover reasonable attorneys' fees. We leave it to the District Court's informed discretion to determine how to accommodate a fee claim by counsel for the subclass within the 30% cap provided in the Settlement Agreement.