Court Opinion

ID: 4460465
Source: CourtListenerOpinion
Date Created: 2019-12-02 21:00:32.743439+00
Date Added: 2024-06-11T14:53:01.278667
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        DEC 2 2019
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

MARY L. JOHNSON, individually and on            No.    18-35967
behalf of all others similarly situated,
                                                D.C. No. 2:17-cv-00541-RSM
                Plaintiff-Appellant,

 v.                                             MEMORANDUM*

MGM HOLDINGS, INC,

                Defendant,

and

METRO-GOLDWYN-MAYER STUDIOS,
INC.; TWENTIETH CENTURY FOX
HOME ENTERTAINMENT, LLC,

                Defendants-Appellees.

                   Appeal from the United States District Court
                      for the Western District of Washington
                   Ricardo S. Martinez, District Judge, Presiding

                           Submitted October 21, 2019**
                               Seattle, Washington

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Before: IKUTA and BENNETT, Circuit Judges, and DORSEY,*** District Judge.

      Class representative Mary Johnson (“Plaintiff” or “Ms. Johnson”) appeals

from the district court’s grant in part, and denial in part, of her Motion for

Attorneys’ Fees and Expenses and Named Plaintiff Enhancement Award

(“Motion”) following the settlement of a class action against Metro-Goldwin-

Mayer Studios, Inc. and Twentieth Century Fox Home Entertainment, LLC

(collectively, “Defendants”). Plaintiff’s unopposed motion requested $350,000 in

attorneys’ fees and costs and a $5,000 incentive award.1

      The Motion was not initially supported by any timekeeper records. After

directing class counsel to submit full billing records, the district court conducted its

own lodestar analysis and a percentage-of-recovery cross-check, ultimately

awarding $184,665 in attorneys’ fees. The district court also awarded $1,500 of the

$5,000 requested incentive award to reflect the effort expended by Ms. Johnson as

class representative. Plaintiff challenges the attorneys’ fees award and incentive

award on multiple grounds.2 This disposition addresses four of those five grounds:

(1) the district court started with the incorrect base number of hours; (2) the district

      ***
              The Honorable Jennifer A. Dorsey, United States District Judge for
the District of Nevada, sitting by designation.
1
   Defendants agreed not to oppose any request for awards up to these amounts.
2
  In a concurrently filed opinion, we reject Plaintiff’s remaining argument for
reversal.

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court did not consider all relevant factors discussed in Kerr v. Screen Extras Guild,

Inc., 526 F.2d 67 (9th Cir. 1975) (“Kerr factors”) in refusing to apply a lodestar

multiplier; (3) the district court’s valuation of the class settlement was in error; and

(4) the district court abused its discretion in decreasing the amount of Ms.

Johnson’s incentive award.

      We review attorneys’ fee and incentive awards for an abuse of discretion. In

re Bluetooth Headset Prods. Liab. Litig., 654 F.3d 935, 940 (9th Cir. 2011)

(attorneys’ fees); In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454, 463 (9th Cir.

2000) (incentive awards). We “affirm unless the district court applied the wrong

legal standard or its findings were illogical, implausible or without support in the

record.” Gonzalez v. City of Maywood, 729 F.3d 1196, 1201–02 (9th Cir. 2013)

(citation omitted).

      First, the district court acted appropriately in basing its lodestar analysis on

the number of hours requested by Plaintiff in her Motion. Plaintiff never made any

attempt to amend her request to increase the number of hours requested. The

billing records were submitted at the court’s request as the initial motion provided

little or no evidence to substantiate the fee request. Diamond v. John Martin Co.,

753 F.2d 1465, 1467 (9th Cir. 1985) (holding that the burden of proof is on the

party seeking the attorneys’ fee award).

      Second, the district court did not abuse its discretion in refusing to apply a

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multiplier to its lodestar calculation after considering all relevant Kerr factors.

Adjustments to the presumptively reasonable lodestar calculation are the exception

rather than the rule. Stanger v. China Elec. Motor, Inc., 812 F.3d 734, 738 (9th Cir.

2016). And the Kerr factors warrant a departure only in “rare and exceptional

cases.” In re Bluetooth, 654 F.3d at 942 n.7 (citation omitted). Here, the district

court provided clear and concise explanations for its consideration and dismissal of

all the Kerr factors raised by Plaintiff in support of a multiplier.

      Third, the district court did not abuse its discretion in valuing the class

action settlement by multiplying its valuation of the total benefit to all possible

individual class members by a ten percent participation rate. It was not an abuse of

discretion to rely upon an assumption of a ten percent participation rate (especially

where, as here, the actual participation rate was less than one percent). See In re

Hyundai & Kia Fuel Econ. Litig., 926 F.3d 539, 571 n.13 (9th Cir. 2019) (en banc)

(stating that participation rates are a “mathematical predicate” to valuing a

settlement). The district court also acted appropriately when it rejected Plaintiff’s

unsubstantiated valuation of the benefit to individual class members and arrived at

a lower individual class member benefit by considering the likely cost to

Defendants to provide the benefit. See Hanlon v. Chrysler Corp., 150 F.3d 1011,

1029 (9th Cir. 1998) (approving a valuation as the amount defendant charged

against its own earnings to account for the settlement). The district court arrived at

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a reasonable valuation based on the record before it.

      Finally, the district court did not abuse its discretion in awarding only

$1,500 of the $5,000 incentive award requested by Plaintiff. The district court

made its award in consideration of the contributions made by Ms. Johnson to the

class action. See Staton v. Boeing Co., 327 F.3d 938, 977 (9th Cir. 2003)

(remanding to district court to consider incentive awards individually, and in doing

so, to consider the effort expended and benefit conferred to the class by each class

representative). The district court lowered the incentive award observing that Ms.

Johnson’s alleged contributions were not substantiated by the record and, in fact,

were partially contradicted by class counsel’s own billing records.

      The district court’s attorneys’ fee award and incentive award were supported

by the record and not illogical or implausible.

AFFIRMED

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