What is 66 years of attorney time worth?
On April 8 Philadelphia federal district court judge Harvey Bartle III came up with an answer in the gargantuan fen-phen class action: a little more than $567.67 million.
That’s the total he awarded to plaintiffs’ lawyers in the case, which has been dragging on since 1999. Judge Bartle found that some 70 plaintiffs firms sank a staggering 578,048 hours into the class action. That’s 24,000 days, or almost 66 years of around-the-clock work.
It also works out to about $982 per hour-a very nice rate even by Am Law 100 standards. (The award will eventually be allocated among the plaintiffs’ firms, with the lion’s share going to lead class counsel Levin, Fishbein, Sedran & Berman.)
Yet by the judge’s reasoning, the payday for fen-phen lawyers is, if anything, a little stingy.
Bartle calculated the final value of the fen-phen class action settlement to be about $6.44 billion. That total was hard-won by the plaintiffs’ lawyers. Fen-phen maker Wyeth originally agreed to a settlement of $1.65 billion. The case turned into a tar baby of fraudulent claims and insufficient funding of “complexity [that] is indeed unparalleled,” Judge Bartle wrote.
He awarded fees of 6.75 percent of that $6.44 billion-less than the average 8.26 percent fee award in nine other billion-dollar class actions cited by plaintiffs’ lawyers. None of those cases lasted as long or ate up as many hours as the fen-phen class action.
The judge checked the reasonableness of his award by making what’s known as a “lodestar” calculation. He multiplied the plaintiffs’ lawyers’ hours-as determined by an outside auditor-by a blended, “reasonable hourly billing rate” ($284) that took into account the wide range of rates among the firms over the nine years of the litigation.
An hourly rate of $284 is obviously quite a bit shy of $982 per hour. That’s because Judge Bartle-as class action precedent dictates-augmented the lodestar by a multiplier based on such factors as the risk and complexity of the litigation and the skill of class counsel. His multiplier was 2.6-again, less than the megacase average of 3.4.
Bartle’s award as a percentage of the settlement, $434.51 million, came to about $45 million less than what the plaintiffs’ lawyers asked for in their 2007 fee application. (The other $133.16 million of their total fee award comes from a separate assessment of the value of the work they did on joint discovery in the fen-phen multidistrict litigation.)
The $567.67 million total is almost exactly what plaintiffs’ lawyers requested in fees and expenses in their first application to Judge Bartle in 2002, before the fen-phen class action descended into time-consuming hearings, audits, and renegotiations.
The plaintiffs’ lawyers say they’re happy with Bartle’s ruling. “We’re gratified that after ten years of hard work, the court has seen fit to adequately and fairly compensate those attorneys who devoted so much [to the case],” says Levin, Fishbein name partner Arnold Levin.