United States District Court, D. Oregon
LARRY ARNETT, RONDA ARNETT, ALICE A. BERGER, LEE M. BERGER, SUSAN LASS, MARK LEMMER, PAMELA LEMMER, KARYL RESNICK, ERIC SKANSGAARD, DONNA M. WADE, and EDWARD M. WALLACE, JR., individually and on behalf of all others similarly situated, Plaintiffs,
BANK OF AMERICA, N.A., in its own capacity and as successor by merger to BAC HOME LOANS SERVICING, L.P., Defendant.
OPINION AND ORDER
MICHAEL H. SIMON, District Judge.
This is a national class action under Federal Rule of Civil Procedure 23, brought on behalf of individuals who allegedly were required by Defendant Bank of America, N.A., in its own capacity and as successor by merger to BAC Home Loans Servicing, L.P., to purchase excessive or unnecessary flood insurance between January 1, 2007 and April 4, 2014. The Court has already certified a settlement class and approved the settlement agreement. This matter comes before the Court on Objector Henry Adkins' ("Adkins") motion for attorney's fees and expenses. Dkt. 291.
For the reasons discussed below, Adkins' motion for attorney's fees is granted in part. Adkins is awarded $9, 566.78 for attorney's fees, which represents 25 percent of the $38, 267.11 benefit to the Settlement Fund achieved from class counsel's withdrawal of their request for reimbursement of costs originally requested by class counsel relating to two cases that were not resolved in the settlement of this action. The Court finds that Adkins' objections to these specific costs provided a benefit to the class. Adkins is also awarded $3, 169.53 for related expenses. Adkins is not awarded any attorney's fees, however, relating to the Court's decision to award the "benchmark" 25 percent of the common fund as attorney's fees in this action, instead of the 30 percent requested by class counsel, because Adkins' objections on this issue did not affect or assist the Court's analysis of attorney's fees.
On April 17, 2014, the Court preliminarily approved a settlement class and settlement agreement in this case. Pursuant to this preliminary approval, a schedule was set under which a notice was sent to all putative class members informing them of their rights, including their right to object to the settlement and the attorney's fees and costs requested by class counsel. The notice also informed class members that class counsel intended to request attorney's fees in the amount of 30 percent of the settlement fund. Under this schedule, class counsel filed their motion for attorney's fees on July 11, 2014, requesting 30 percent of the settlement fund. Class members had until August 11, 2014 to lodge any objections.
On August 11, 2014, Adkins timely filed objections to the requested attorney's fees and expenses. Adkins objected that: (1) class counsel inflated their lodestar calculation by including excess time and charging inflated rates; (2) class counsel violated the Court's local rules regarding fee petitions by failing to provide appropriate documentation; and (3) class counsel failed properly to document the requested expenses. The preliminary approval order required that Plaintiffs respond to any objections at least fourteen days before the fairness hearing. On August 25, 2014, class counsel filed their reply in support of their fee motion and responded to the objections raised, including Adkins' objections.
On September 8, 2014, one day before the fairness hearing, Adkins filed a sur-reply, arguing with respect to the attorney's fees request that the factors set out by the United States Court of Appeals for the Ninth Circuit that are to be considered when class counsel requests an upward departure from the Ninth Circuit's benchmark 25 percent fee award did not support an upward departure in this case. Specifically, Adkins argued that: (1) the results achieved do not compare favorably with the results achieved in Clements v. JP Morgan Chase, N.A., Case No. 3:12-cv-02179 (N.D. Cal.); (2) class counsel inflated their lodestar figures, which serve as a "backcheck" for percentage-of-the-fund attorney's fee awards because some of the work performed by counsel related to cases that did not provide a benefit to the class and because the amount of time spent by Plaintiffs' counsel was not extraordinary or unusual for class action litigation; and (3) class counsel did not undertake any special or extraordinary risk in litigating this case.
The Court held a fairness hearing on September 9, 2014, which counsel for Adkins attended. The Court opened the portion of the hearing relating to attorney's fees by describing the factors established by the Ninth Circuit for considering upward departures from the 25 percent benchmark, noting that the Court was concerned primarily with the results obtained and the lodestar cross check factors. The Court expressed skepticism regarding class counsel's request for an upward departure from the Ninth Circuit's 25 percent "benchmark" fee to 30 percent. The Court then heard argument from counsel. Counsel for Adkins argued at the hearing, focusing on the results-obtained factor as compared to Clements and the issue of the evidentiary support for the requested fees.
At the fairness hearing, the Court questioned class counsel regarding the $38, 267.11 in requested expenses relating to two cases that had been dismissed before the settlement agreement was reached and were not being resolved in the settlement agreement. The Court allowed supplemental briefing on this issue. On September 15, 2014, class counsel withdrew their request for those specific expenses.
On September 18, 2014, the Court approved the settlement agreement and granted in part Plaintiffs' motion for attorney's fees and costs. The Court awarded the 25 percent benchmark percentage of the common fund as attorney's fees. The Court declined to award the requested 30 percent, primarily because the Court found that: (1) the results obtained were not extraordinary, particularly when compared with settlements achieved in Fladell v. Wells Fargo, No. 13-cv-60721, Docket No. 182 (S.D. Fl.) and Casey v. Citibank, N.A., Civil Action No. 5:12-cv-820-DNH-DEP (N.D.N.Y.); (2) because the settlement resolved seven different actions, the lodestar time included time that was likely duplicative and repetitive; and (3) the 25 percent benchmark fee award adequately compensated class counsel for the remaining factors, including the risk involved, the experience of counsel, and the reaction of the class.
Objectors may be entitled to fees if they "substantially enhance the benefits to the class under the settlement." Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1052 (9th Cir. 2002); see also Fraley v. Facebook, Inc., 2014 WL 806072, at *2 (N.D. Cal. Feb. 27, 2014) (noting that "the threshold requirements remain that the objectors must contribute materially to the proceeding' and produce an improvement in the settlement worth more than the fee they are seeking'" (quoting Reynolds v. Beneficial Nat. Bank, 288 F.3d 277, 288 (7th Cir. 2002))). Here, Adkins objected to class counsel's request for expenses and request for an upward departure in attorney's fees to 30 percent of the common fund. The Court finds that Adkins' objections contributed materially to the expense benefit obtained by the common fund ($38, 267.11), but did not contribute materially to the Court's decision to award the 25 percent benchmark as attorney's fees.
A. Benefit to Class Members Relating to Expenses Awarded
Adkins' objections to class counsel's requested expenses incurred litigating the two cases that were dismissed before the settlement agreement alerted the Court to the issue and, as a result, the Court questioned class counsel about those expenses at the hearing. Shortly after the fairness hearing, class counsel withdrew their request for reimbursement of those specific expenses. Thus, the Court finds that Adkins' objections materially assisted the Court with respect to those specific expenses and substantially benefited the class by increasing the settlement fund by $38, 267.11. The Court, therefore, awards Adkins attorney's fees in the amount of 25 percent of the ...