Coughlin Stoia Geller Rudman & Robbins, formerly of Bill Lerach fame, and other law firms sued to pin the blame on banks, auditors, and other outside deep-pocket third parties, as well as on directors; defendants collectively paid $7.2 billion. Giving the plaintiff’s lawyers $688 million of that is very “fair and reasonable” and involves no “windfall”, per U.S. District Judge Melinda Harmon. (Bloomberg, Sept. 8).
More: OK, so maybe Brian Baxter of AmLaw Daily is just pursuing a reasonable news angle when he quotes the Coughlin Stoia lawyers doing a little victory lap and waving to the crowd. But if he’s going to quote Prof. John Coffee at such length as his big authority in support of the fee’s fairness, shouldn’t he go beyond identifying Coffee as “a professor at Columbia Law School and frequent class action critic” to spell out a little more explicitly that, you know, Coffee was hired by the plaintiff’s lawyers in this case to defend their fee request? Doesn’t that make it less surprising that Patrick Coughlin “welcomes the positive feedback” from these supposedly “unlikely legal circles” to support his case? (more background, yet more).
Update Thurs. a.m.: by yesterday evening American Lawyer had substantially “updated [the post] with new information” to reflect the Coffee relationship, and Prof. Obbie is kind enough to give me some credit for that happening.
6 Comments
That is only 10% – for a contingency fee, that’s quite reasonalb e9these days).
Of course, the underlying claims are completely ridiculous, so it’s still a travishamockery…
I’ll bet those SCOTUS clerks with their $275,000 to $300,000 signing bonuses (OT’07) are wishing that they’d become plaintiffs’ lawyers to collect this kind of bonus–it has to be easily in the tens-of-millions for the big partners.
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If my math is right, $688 million for a claimed 280,000 hours spent = an effective hourly rate of $2,428.57 Must be nice. No, this isn’t a “windfall”, no, not at all. How does this not violate the rules of professional conduct that attorney fees must be “reasonable”?
It’s terrible that legal fees for these kinds of class action suits are still based on contingency fees. The panel of judges for these suits need to limit the fees to the customary hourly fees for legal representation. An hourly rate ($200-$400) is high but not usury as in the Enron class action. I have no connection to Enron, but the one suit I was a party to was much the same, on a smaller scale of course. The lawyers were paid millions while the participants in the suit received $79 each.
[…] updating a Tuesday post, I expressed some annoyance that AmLaw Daily’s coverage of the $688 million Enron fee award extensively quoted Columbia […]