Opinion ID: 3011727
Heading Depth: 3
Heading Rank: 2

Heading: Range of Awards

Text: Before reviewing specific awards in other large class settlements, we will review generally the range of attorneys' fee awards in common fund settlements of class actions. In In re GM Trucks, we observed that [o]ne court has noted that the fee awards have ranged from nineteen percent to forty-five percent of the settlement fund. 55 F.3d 768, 822 (3d Cir. 1995) (citing In re Smithkline Beckman Corp. Sec. Litig., 751 F. Supp. 525, 533 (E.D. Pa. 1990)). We also noted in In re Prudential that [t]he district court . . . examined the fee awards in class actions with r ecoveries exceeding $100 million and found the fee per centages ranged from 4.1% to 17.92%. 148 F.3d 283, 339 (3d Cir. 1998). However, recently two district courts in this Circuit have declined to follow this court's statement of the range in In re Prudential, stating that the cases cited in [In re 22 Prudential] were all decided at least thirteen years ago. In re Ikon Office Solutions, Inc. Sec. Litig. , 194 F.R.D. 166, 196 (E.D. Pa. 2000); In re Orthopedic Bone Screw Prod. Liab. Litig., 2000 WL 1622741, at 7 (E.D. Pa. Oct. 23, 2000). Indeed, in another Cendant opinion dealing with attorneys' fees, this same District Court stated that, in cases surveyed by lead counsel, [a]wards . . . ranged from a low of 20% in the case with a $200 million recovery to a high of 33.3% for cases with recoveries of $77.5 million and $110 million. In re Cendant Corp. Sec. Litig., 109 F .Supp.2d 285, 290 (D.N.J. 2000). These varying ranges of attor neys' fees confirm that a district court may not r ely on a formulaic application of the appropriate range in awar ding fees but must consider the relevant circumstances of the particular case. One important consideration is the size of the settlement. The Task Force Report stated, with r eference to fee awards in common fund cases: The negotiated fee, and the procedure for arriving at it, should be left to the court's discretion. In most instances, it will involve a sliding scale dependent upon the ultimate recovery, the expectation being that, absent unusual circumstances, the percentage will decrease as the size of the fund incr eases. 108 F.R.D. 237, 256 (1985). We called attention to this statement in In re Prudential, explaining that [t]he basis for this inverse relationship is the belief that `[i]n many instances the increase [in recovery] is mer ely a factor of the size of the class and has no direct relationship to the efforts of counsel.'  In re Prudential, 148 F.3d at 339 (quoting In re First Fidelity Bancorporation Sec. Litig., 750 F . Supp. 160, 164 n. 1 (D.N.J. 1990)). Accordingly, district courts setting attorneys' fees in cases involving lar ge settlements must avoid basing their awards on percentages derived from cases where the settlement amounts were much smaller.