Today American Express Co. announced that it would drop its antitrust lawsuit against Mastercard for payments that could reach $1.8 billion. This comes on top of its settlement last year with Visa for up to $2.25 billion, bringing Amex’s total potential antitrust recovery to $4 billion.
And that means a large pay day for David Boies and his firm.
Boies and his firm, Boies, Schiller & Flexner, have been representing Amex on a partial contingency fee basis since the case was filed in 2004. In the past Boies has declined to reveal details about this arrangement. But Amex’s annual report, filed last March, gives an indication of how well Boies’s gamble has paid off.
The company stated that it had paid legal fees of $74 million in connection with the first installment of the Visa payment, which was $1.13 billion. That would represent a contingency fee of 6.5 percent. (It’s possible that a small portion of this $74 million went to another firm, although Boies, Schiller did not have a cocounsel listed in court records.)
It’s likely, however, that Boies, Schiller isn’t getting a 6.5 percent fee on the total $4 billion. According to one lawyer familiar with the firm’s contingency arrangement, Boies, Schiller and Amex agreed to a sliding scale fee that drops as more money is collected. So the recovery above this first $1.13 billion will likely result in fees of less than 6.5 percent. Still, Boies and his partners are undoubtedly prepped for a huge payday.
If the firm received a mere 4 percent of the rest of the recovery, that would give the folks at Boies another $115 million, for a total fee of nearly $190 million.