CASE No. 30-2009-00317275 Class Action MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY’S FEES AND LITIGATION EXPENSES Hearing Date: December 1, 2010 Hearing Time: 8:30 a.m. Judge:Hon. Nancy Wieben Stock Dept.: CX105 Action Filed: November 4, 2009 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES Case No. 30-2009-00317275 1
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES Case No. 30-2009-00317275 BLUMENTHAL, NORDREHAUG & BHOWMIK Norman B. Blumenthal (State Bar #068687) Kyle R. Nordrehaug (State Bar #205975) Aparajit Bhowmik (State Bar #248066) 2255 Calle Clara La Jolla, CA 92037 Telephone: (858)551-1223 Facsimile: (858) 551-1232 UNITED EMPLOYEES LAW GROUP Walter Haines (State Bar #71705) 65 Pine Ave, #312 Long Beach, CA 90802 Telephone: (562) 256-1047 Facsimile: (562) 256-1006 Attorneys for Plaintiff SUPERIOR COURT OF THE STATE OF CALIFORNIA IN AND FOR THE COUNTY OF ORANGE NIMET BEHAR, on behalf of herself, and on behalf of all persons similarly situated, Plaintiffs, vs. UNION BANK, N.A., Defendant. CASE No. 30-2009-00317275 Class Action MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY’S FEES AND LITIGATION EXPENSES Hearing Date: December 1, 2010 Hearing Time: 8:30 a.m. Judge: Hon. Nancy Wieben Stock Dept.: CX105 Action Filed: November 4, 2009
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1MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
Case No. 30-2009-00317275
BLUMENTHAL, NORDREHAUG & BHOWMIK Norman B. Blumenthal (State Bar #068687) Kyle R. Nordrehaug (State Bar #205975) Aparajit Bhowmik (State Bar #248066)2255 Calle ClaraLa Jolla, CA 92037Telephone: (858)551-1223Facsimile: (858) 551-1232
UNITED EMPLOYEES LAW GROUP Walter Haines (State Bar #71705)65 Pine Ave, #312Long Beach, CA 90802Telephone: (562) 256-1047Facsimile: (562) 256-1006
Attorneys for Plaintiff
SUPERIOR COURT OF THE STATE OF CALIFORNIA
IN AND FOR THE COUNTY OF ORANGE
NIMET BEHAR, on behalf of herself, andon behalf of all persons similarly situated,
Plaintiffs,
vs.
UNION BANK, N.A.,
Defendant.
CASE No. 30-2009-00317275
Class Action
MEMORANDUM OF POINTS ANDAUTHORITIES IN SUPPORT OF MOTIONFOR AWARD OF ATTORNEY’S FEESAND LITIGATION EXPENSES
Hearing Date: December 1, 2010Hearing Time: 8:30 a.m.
Judge: Hon. Nancy Wieben StockDept.: CX105
Action Filed: November 4, 2009
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A. The Agreement for the Payment of Fees and Expenses is Appropriate and Should Be Enforced . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
III. CLASS COUNSEL'S FEE AWARD IS PROPERLY CALCULATED AS APERCENTAGE OF THE TOTAL VALUE CREATED FOR THE BENEFIT OF THECLASS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
A. In a Common Fund Case, an Award Based Upon The Percentage of the Fund Is Not Prohibited By California Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
B. The Fee Award is Supported By 1) the Results Achieved; 2) the Risk, 3) the SkillRequired, 4) the Contingent Nature of the Fee and 5) Awards In Similar Cases . . . 7
1 The procedural history of this action, the discovery conducted, the settlement negotiations, andthe risks of litigation and of establishing liability and damages at trial are described in Plaintiffs’ Memorandum in Support of Motion for Final Approval of Class Action Settlement filed herewith. 2 The reasonableness of this attorneys’ fee award is also established by reference to ClassCounsel’s lodestar, which is $138,837.50. This is Class Counsel’s lodestar as of November 9,2010. Class Counsel will be incurring additional attorneys’ fees in completing final approval,appearing before this Court and completing all of the remaining work required for the Settlement.
1MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
Case No. 30-2009-00317275
I. INTRODUCTION
After almost a year litigation, Class Counsel successfully negotiated a California class action
settlement which provides for a common fund settlement to paid to the Settlement Class in the amount
of Nine Hundred Seventy-Five Thousand Dollars ($975,000) (the “Settlement Sum”). As part of the
settlement, the parties agreed to an award of attorneys’ fees and costs equal to 25% of the total
settlement value. Class Counsel respectfully applies to the Court for approval of the agreed attorneys’
fee award equal to 25% of the Settlement Sum.
Preliminary approval of the Class Settlement was granted on July 23, 2010. Notice of the
Settlement was mailed to the Class Members.1 Not one Class Member has objected to the requested fee
award. (Declaration of Blumenthal at ¶16.) The requested attorneys’ fee award is at the low end of the
benchmark for fees of 25% to 40% of a common fund and is fair compensation for undertaking such
complex, risky and time-consuming litigation on a contingent basis. See Six Mexican Workers v.
Arizona Citrus Growers, 904 F.2d 1301, 1311 (9th Cir. 1990) (establishing “25 percent of the fund as
the ‘benchmark’ award that should be given in common fund cases.”)
The requested award of 25% of the common fund is well within the range of reasonableness and
the results achieved for the Class Members are excellent, Plaintiff respectfully request that the Court
award the requested attorneys’ fees in the amount of 25% of the Settlement Sum, which equals
$243,750 for attorneys' fees.2 After extensive and hard fought negotiations, the award sought herein
was finally agreed upon by the Parties. Not one Class Member has objected to the fee award and the
award is not opposed by Defendant. The award is more than reasonable and appropriate when viewed
as a percentage of the common fund (25%), and is further supported by reference to the under the
lodestar multiplier approach because the requested award is equal to Class Counsel’s lodestar with a
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3 See Pellegrino v. Robert Half Intern., Inc., 182 Cal.App.4th 278 (2010) (in class actions “reasonable multipliers of 2.0 to 4.0 are often applied.”); Wershba v. Apple Computer, 91 Cal. App.4th 224, 255 (2001) ("multipliers can range from 2 to 4 or even higher."); In re Sutter HealthUninsured Pricing Cases,171 Cal.App.4th 495, 512 (2009) (affirming multiplier of 2.52 as “fair andreasonable); Chavez v. Netflix, Inc., 162 Cal.App.4th 43, 66 (2008) (affirming multiplier of 2.53 aswell within the approved range of 2 to 4).
2MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
Case No. 30-2009-00317275
modest multiplier (1.75), which is warranted and reasonable under settled precedent.3
Plaintiff also respectfully seeks approval of reimbursement of litigation expenses in the amount
of $17,852.69, which is less than what is provided by the Settlement Agreement. Finally, Plaintiff
respectfully requests that this Court order payment of a class representative service award of four
thousand dollars ($4,000) to the Plaintiff in accordance with the Settlement Agreement.
II. THE ATTORNEYS’ FEES REQUESTED ARE FAIR AND REASONABLE ANDSHOULD BE APPROVED
In defining a reasonable fee, the Court should mimic the marketplace for cases involving a
significant contingent risk such as this one. Our legal system places unique reliance on private litigants
to enforce substantive provisions of employment law through class actions. See Gentry v. Superior
Court, 42 Cal. 4th 443, 450-6 (2007) (confirming the public importance of private enforcement of
overtime laws through class actions). Therefore, attorneys providing these substantial benefits should
be paid an award equal to the amount negotiated in private bargaining that takes place in the legal
market place. Deposit Guaranty Nat. Bank, Jackson, Miss. v. Roper, 445 U.S. 326, 338, rehg. denied,
446 U.S. 947 (1980). “When a fee is set by a court rather than by contract, the object is to set it at a
level that will approximate what the market would set. . . . The judge, in other words, is trying to mimic
the market in legal services.” Gaskill v. Gordon, 160 F.3d 361, 363 (7th Cir. 1998); Lealao v.
Beneficial California, Inc. 82 Cal.App.4th 19, 49-50 (2000) (“attempting to award the fee that informed
private bargaining, if it were truly possible, might have reached.” A fee award should approximate a
“percentage fee [] freely negotiated in comparable litigation.”).
At the time this case was brought, the result was far from certain. Defendant’s practice at issue
here had been in place for years. Defendant’s numerous defenses to the merits of the case and to class
certification created difficulties with proof and complex legal issues for Class Counsel to overcome.
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4 Dunbar v. Albertson's, Inc., 141 Cal. App. 4th 1422, 1431-32 (2006) affirmed an order denyingclass certification to a class of employees who claimed that they were denied overtime pay holdingthat the issue of whether an exemption applied would have to be individually determined for eachclass member, which meant that common issues did not predominate. See also Morisky v. PublicServ. Elec. & Gas Co., 111 F. Supp. 2d 493, 498 (D.N.J. 2000) (application of overtime exemptiondepended on individual issues that barred certification); Walsh v. Ikon Office Solutions, 148 Cal.App. 4th 1440 (2007) (upholding the decertification of an overtime class action).
3MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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For example, were the Plaintiffs’ and Class Members’ claims barred from recovery by the
“administrative exemption”as was held in Kennedy v. Commonwealth Edison Co., 410 F.3d 365, 373-
74 (7th Cir. 2005)? Did Class Members perform work that was “directly related to management or
general business operations” within the meaning of the “executive exemption” as was held in Baldwin
v. Trailer Inns, Inc. 266 F.3d 1104 (9th Cir.2001)? Would Plaintiffs be able to obtain class
certification and thereby recover on behalf of Defendant’s employees?4 All of these were very
substantial risks any of which could have resulted in the Class receiving nothing if the claims were
litigated. (Declaration of Blumenthal ¶10(f)-(g).)
The Settlement was possible only because Class Counsel had been able to convince Defendant
that Class Counsel could potentially prevail on the legal issues regarding overtime compensation,
achieve class certification for all the employees in the position at all banking locations, and overcome
difficulties in proof as to monetary relief.
In successfully navigating these hurdles so as to convince Defendant to settle, Class Counsel
displayed skills consistent with those that might be expected of attorneys of comparable class action
experience. Here, Class Counsel was pursuing a difficult and risky claim where previous actions, as
noted above, had failed to establish liability for overtime, failed to obtain class certification and/or
failed to obtain monetary recovery for these employees.
Class Counsel’s skill in presenting this case to overcome the difficulties that prevented recovery
in many other overtime wage cases is also compelling given the exceptional and well recognized
quality of Defendant’s Counsel from the respected, capable, and well-staffed law firm of Pillsbury
Winthrop Shaw Pittman LLP. See In re King Resources Co. Securities Litig. 420 F.Supp. 610, 634 (D.
Colo. 1976); Arenson v. Board of Trade, 372 F.Supp. 1349, 1354 (N.D. Ill. 1974). To represent the
Class on a contingent fee basis, Class Counsel had to forego compensable hourly work on other cases
4MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
Case No. 30-2009-00317275
to devote the necessary time and resources to this contingent case. In so doing, Class Counsel gave up
the hourly work that a firm can bank on for the risky contingent fee work in this case which could have
paid Class Counsel nothing. Powers v. Eichen, 229 F.3d 1249, 1256 (9th Cir. 2000).
A. The Agreement for the Payment of Fees and Expenses is Appropriate and ShouldBe Enforced
The United States Supreme Court has ruled that the parties to a class action properly may
negotiate not only the settlement of the action itself, but also the payment of attorneys' fees. See Evans
v. Jeff D., 475 U.S. 717, 734-35, 738, n.30 (1980). In Hensley v. Eckerhart, 461 U.S. 424, 437 (1983),
the Supreme Court held that negotiated, agreed-upon attorneys' fee provisions are the ideal towards
which the parties should strive:
A request for attorney's fees should not result in a second major litigation. Ideally, ofcourse, litigants will settle the amount of a fee.
Id.
The United States Supreme Court has reemphasized this policy and further stressed that the trial
court “has a responsibility to encourage agreement” on fees. Blum v. Stenson, 465 U.S. 886, 902 n.19
(1984). Here, as part of the Settlement, Defendant agreed not to object to a award of 25% of the
settlement amount for attorneys’ fees. Such a fee is commensurate with what the market would provide
for similar services and the Court therefore can most certainly enforce the agreement. As the United
States Supreme Court has instructed:
Given the unique reliance of our legal system on private litigants to enforce substantiveprovisions of law through class and derivative actions, attorneys providing theessential enforcement services must be provided incentives roughly comparable tothose negotiated in the private bargaining that takes place in the legal marketplace,as it will otherwise be economic for defendants to increase injurious behavior.
Deposit Guaranty Nat. Bank, supra, 445 U.S. at 338.5
Here, informed arms-length bargaining between experienced counsel for the Class and
Defendant was clearly adversarial and arms length as the amount was the result of a mediator’s
proposal. Such bargaining is obviously the best measure of the market for fees. The requested fee and
cost award was bargained for during adversarial bargaining by counsel for each of the parties, after the
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substantive terms of the Settlement had been agreed to. The requested fee and cost award was a
product of arms-length negotiations and fairly reflects the marketplace value of the services rendered
by Class Counsel in this case. (Declaration of Blumenthal at ¶9). As a result, the fee agreed to by the
parties should be approved.
III. CLASS COUNSEL'S FEE AWARD IS PROPERLY CALCULATED AS APERCENTAGE OF THE TOTAL VALUE CREATED FOR THE BENEFIT OF THECLASS
Class Counsel seeks an attorney fee award for their successful prosecution and resolution of this
action, calculated as 25% the cash value of the common fund created by the Settlement. In cases such
as this one, California and federal courts have long recognized that an appropriate method for
determining the award of attorneys’ fees is based on a percentage of the total value of benefits afforded
to class members by the settlement. Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980); Paul,
Johnson, Alston & Hunt v. Graulty, 886 F.2d 268, 272 (1989); Vincent v. Hughes Air West, Inc. 557
F.2d 759, 769 (9th Cir. 1977); Serrano v. Priest, 20 Cal.3d 25, 34 (1977). Moreover, 25% is
reasonable and at the low end of commonly awarded fees. A review of class action settlements
over the past 10 years shows that the courts have historically awarded fees in the range of 20%
to 50%, depending upon the circumstances of the case. See In re Warner Communications Sec.
Lit, 618 F.Supp. 735, 749-50 (S.D. N.Y. 1985); see also Vizcaino v. Microsoft Corp., 290 F.3d 1043,
1047-49 (9th Cir. 2002) (approving 28% attorneys fee award as reflecting “the standard contingency
fee for similar cases”); Six Mexican Workers, supra, 904 F.2d at 1311 (confirming “25 percent of the
fund as the ‘benchmark’ award that should be given in common fund cases.”).
The awarding of a fee based on a percentage of the common fund recovered is to “spread
litigation costs proportionately among all the beneficiaries so that the active beneficiary does not bear
the entire burden alone.” Vincent v. Hughes Air West, Inc., supra, 557 F.2d at 769. The Total
Settlement Value is $975,000.00. Accordingly, Class Counsel reasonably requests $243,750 in
attorneys fees as a percentage (25%) of the common fund created for the benefit of the Class.
Notably, this is an all-in common fund settlement without a reversion to the Defendant.
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6 Dunk v. Ford Motor Co., 48 Cal.App.4th 1794 (1996), also does not prohibit adjustment of thelodestar multiplier to mimic a percentage fee. In Dunk the percentage-of-the-benefit approach couldnot be applied because, unlike the $975,000 Settlement in this case, the monetary value of therecovery in Dunk was not an “easily calculable sum of money.” Id. at 1809. See Lealao, 82Cal.App. 4th at 50. (“Though the settlement did not create a common fund out of which fees are tobe paid, the monetary value of the benefit to the class is much less speculative than that of sometraditional common funds.”)
6MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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A. In a Common Fund Case, an Award Based Upon The Percentage of the Fund IsNot Prohibited By California Law
California courts have been expressly authorized to award attorneys’ fees so as “to ensure that
the fee awarded is within the range of fees freely negotiated in the legal marketplace in
comparable litigation.” Lealao v. Beneficial Cal., Inc., supra, 82 Cal.App. 4th at 50. As Lealao
explained, in a representative action, courts must consider the amount of attorney fees typically
negotiated in comparable litigation:
Given the unique reliance of our legal system on private litigants to enforce substantiveprovisions of law through class and derivative actions, attorneys providing theessential enforcement services must be provided incentives roughly comparable tothose negotiated in the private bargaining that takes place in the legal marketplace,as it will otherwise be economic for defendants to increase injurious behavior. It hastherefore been urged (most persistently by Judge Richard Posner) that in defining a“reasonable fee” in such representative actions the law should “mimic the market.”
Id. at 47.
In this case, the fees are being paid from the common fund, accordingly, the fee should be
awarded to mimic fees freely negotiated in the legal marketplace for comparable common fund cases
under Lealao. (Declaration of Blumenthal at ¶10(b).) As Lealao acknowledged, in cases like this one,
the percentage-of-the-benefit approach should be considered because it “it better approximates the
workings of the marketplace than the lodestar approach.” 82 Cal.App. 4th at 49.
It is in large part because it provides a credible measure of the market value of the legalservices provided that some federal courts use a percentage-of-the-benefit analysis to“cross-check” the propriety of a lodestar fee award. ( In re General Motors Corp.Pick-Up Truck Fuel Tank, supra, 55 F.3d at p. 820 [“it is sensible for a court to use asecond method of fee approval to cross check its conclusion under the first method”];As we have said, the California Supreme Court has never prohibited adjustmentof the lodestar on this basis.
Id.6
In Consumer Privacy Cases, 175 Cal. App. 4th 545, 557-8 (2009), the Court of Appeal recently
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7 As Lealao notes, in the context of a common fund settlement, the California SupremeCourt has never prohibited the use of a percentage of the fund to award fees. 82 Cal.App. 4that 49. In fact, the California Supreme Court has urged trial courts to follow class action federalauthority. Green v. Obledo, 29 Cal. 3d 126, 146 (1981); Vasquez v. Superior Court, 4 Cal.3d 800,821 (1971).
7MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
Case No. 30-2009-00317275
acknowledged that under California law, a percentage of the fund method may be used in a common
fund case:
Regardless of whether attorney fees are determined using the lodestar method orawarded based on a “percentage-of-the-benefit” analysis under the common funddoctrine, “‘[t]he ultimate goal … is the award of a “reasonable” fee to compensatecounsel for their efforts, irrespective of the [*558] method of calculation.’ [Citations.]”(Apple Computer, Inc. v. Superior Court, supra, 126 Cal.App.4th at p. 1270.) [***23]It is not an abuse of discretion to choose one method over another as long as themethod chosen is applied consistently using percentage figures that accurately reflectthe marketplace.
Id., 175 Cal. App. 4th at 557-8.
Because this is a common fund case, and the percentage of the fund is the comparable
marketplace for fee awards in common fund cases, Lealao and Consumer Privacy support an
award based upon the percentage of the common fund.7 Here, as noted above 25% is the
benchmark and the low end of comparable awards for common fund cases, which establishes the
requested award as reasonable.
B. The Fee Award is Supported By 1) the Results Achieved; 2) the Risk, 3) the SkillRequired, 4) the Contingent Nature of the Fee and 5) Awards In Similar Cases
What has now emerged in most fee award decisions is a recognition that fee determinations in
both common fund and statutory fee situations are incapable of mathematical precision because of the
intangible factors that must be resolved in the court's discretion based on the circumstances of each
particular case. See, A. Conte, Attorney Fee Awards, 2nd Ed., § 207, at §§44. In determining an
appropriate fee in a common fund case, a court must decide, based on the unique posture of each case,
what percentage of the common fund would most reasonably compensate Class Counsel given the
nature of the litigation and the performance of counsel. Paul, Johnson, Alston & Hunt, supra, 886 F.2d
at 272 (the benchmark percentage fee may be adjusted to account for the circumstances involved in this
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case.)
Courts apply a five-part test in calculating a reasonable percentage fee in common fund cases.
(1) the results achieved; (2) the risk of litigation; (3) the skill required and the qualityof work; (4) the contingent nature of the fee and the financial burden carried by theplaintiffs; and (5) awards made in similar cases.
In re Omnivision Technologies, Inc., 2007 WL 4293467 at *9 (N.D.Cal., Dec 06, 2007).
Here, each of these five factors strongly support an award of the percentage fee (25%) requested
in this case.
1. The Results Achieved
“The overall result and benefit to the class from the litigation is the most critical factor in
granting a fee award.” Omnivision, 2007 WL 4293467 at *9; See also In re Heritage Bond Litig., 2005
U.S. Dist. LEXIS 13627, at *27-28 (C.D. Cal. June 10, 2005). Class Counsel obtained an excellent
result in this case for the Class Members and at fairly early stage of the litigation. The Settlement
provides monetary benefits to the Class Members that are superior to those recovered in similar
overtime wage class actions. The Settlement is particularly advantageous to the Settlement Class
because the proceeds will be distributed shortly as opposed to waiting additional years for a similar,
or possibly, less favorable result.
There is little question that the result achieved in this litigation is excellent. The absence of any
objection to either the settlement or the attorneys’ fee request from any of a total of 111 Settlement
Class Members bears this out. Settlement Class Members will receive thousands of dollars as their
share of the settlement. The average Class Member’s recovery is a sum that exceeds most Class
Member’s expectations and an amount that may make a real impact on their lives.
The Settlement Class Members also received a substantial benefit as the result of the relatively
early settlement of this action both in terms of receiving the settlement proceeds much sooner and
avoiding the risk of receiving nothing at all. See Glass v. UBS Fin. Servs. 2007 U.S. Dist. LEXIS 8476
at * 48 (N.D.Cal. Jan. 27 2007) (“The early settlement of the instant action resulted in significant
benefit to the class…. Class counsel achieved an excellent result for the class members by settling the
instant action promptly.”) As a result, this factor would support an enhancement of the fee award, and
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therefore certainly supports the fee award in this case which is at the ordinary benchmark of 25%.
2. Risks of Litigation
“The risk that further litigation might result in Plaintiffs not recovering at all, particularly a case
involving complicated legal issues, is a significant factor in the award of fees.” Omnivision, 2007 WL
4293467 at *9.
At the time this case was brought, the result was far from certain. Defendant’s practice at issue
here had been in place for years. Defendant’s numerous defenses to the merits of the case and to class
certification created difficulties with proof and complex legal issues for Class Counsel to overcome.
For example, were the Plaintiffs’ and Class Members’ claims barred from recovery by the
“administrative exemption”as was held in Kennedy, supra, 410 F.3d 365, 373-74? Did Class Members
perform work that was “directly related to management or general business operations” within the
meaning of the “executive exemption” as was held in Baldwin, supra, 266 F.3d 1104? Would
Plaintiffs be able to obtain class certification and thereby recover on behalf of Defendant’s employees?
All of these were very substantial risks any of which could have resulted in the Class receiving nothing
if the claims were litigated. (Declaration of Blumenthal ¶10(f).)
Finally, would Plaintiffs be able to obtain class certification and thereby recover on behalf of
all employees at all banking locations? Dunbar, supra, 141 Cal. App. 4th at 1431-32, affirmed an order
denying class certification to a class of employees who claimed that they were denied overtime pay
holding that the issue of whether an exemption applied would have to be individually determined for
each class member, which meant that common issues did not predominate. In particular, the Dunbar
decision relied on the significant variation from store to store, which is the exact argument advanced
by Defendant in this case. See also Morisky, supra,. 111 F. Supp. 2d at 498. (application of overtime
exemption depended on individual issues that barred certification); Walsh, supra, 148 Cal. App. 4th
1440 (upholding the decertification of an overtime class action). Here, Defendant had stated that class
certification would be vigorously opposed, and there was certainly a risk that class certification would
have been denied. (Declaration of Blumenthal, ¶ 10(g).)
All of these were very substantial risks any of which could have resulted in the Class receiving
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nothing if the claims were litigated. This factor therefore also supports an enhancement of the
percentage, making the requested fee equal only to the benchmark undeniable reasonable.
3. The Skill Required and the Quality of Work
Practice in the narrow area of wage and hour class action litigation requires skill, knowledge
and experience in two distinct subsets of the law. Expertise in one does not necessarily translate into
expertise in the other. Class Counsel must have expertise in both. The issues presented in this case
required more than just a general appreciation of wage and hour law and class action procedure as this
area of practice is still developing as evidenced by the Supreme Court’s recent ruling in Murphy v.
Kenneth Cole Productions, Inc., 40 Cal.4th 1094 (2007) (holding that payments under Labor Code §
226.7 are a wage not a penalty) and the recent decision by the Ninth Circuit in Mevorah v. Wells Fargo
Home Mortg. (In re Wells Fargo Home Mortg.), 571 F.3d 953 (9th Cir. 2009).
The Settlement was possible only because Class Counsel was able to convince Defendant that
Plaintiff could potentially prevail on the difficult legal issues regarding overtime compensation, achieve
class certification, overcome difficulties in proof as to monetary relief and take the case to trial if need
be, as exemplified by the foregoing.
In successfully navigating these hurdles Class Counsel displayed the necessary dual skill set.
The high quality of the Class Counsel’s work in this case was mandated by the very vigorous and
experienced defense presented by counsel for Defendant. Class Counsel was required to invest
substantial time and resources in investigation, discovery and determination of potential damages and
communicating with and responding to opposing counsel’s and class members’ requests and inquiries.
4. The Contingent Nature of the Fee and the Financial Burden
There is a substantial difference between the risk assumed by attorneys being paid by the hour
and attorneys working on a contingent fee basis. The attorney being paid by the hour can go to the
bank with his fee. Powers, supra, 229 F.3d at 1256. The attorney working on a contingent basis can
only log hours while working without pay towards a result that will hopefully entitle him to a market
place contingent fee taking into account the risk and other factors of the undertaking. Id at 1257.
Otherwise, the contingent fee attorney receives nothing. Id.
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28 11MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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In this case, Class Counsel subjected themselves to this contingent fee market risk in this all or
nothing contingent fee case wherein the necessity and financial burden of private enforcement makes
the requested award appropriate. The contingent fee practices of Class Counsel do not accommodate
the investment of unnecessary time in a case. This case was litigated on a contingent basis with all of
the concomitant risk factors inherent in such an uncertain undertaking. (Declaration of Blumenthal,
¶ 10(d).) On account of the concerted and dedicated effort this case demanded in order to properly
handle and prosecute, Class Counsel were precluded from taking other cases, and in fact, had to turn
away other potential fee generating cases. (Declaration of Blumenthal at ¶3.)
Counsel retained on a contingency fee basis, whether in private matters or in class action
litigation, is entitled to a premium beyond their standard, hourly, non-contingent fee schedule in order
to compensate for both the risks and the delay in payment. The simple fact is that despite the most
vigorous and competent of efforts, success is never guaranteed. McKittrick v. Gardner, 378 F.2d 872,
875 (4th Cir.1967). Indeed, if counsel is not adequately compensated for the risks inherent in difficult
class actions, competent attorneys will be discouraged from prosecuting similar cases. Steiner v. BOC
Financial Corp., 1980 U.S. Dist. LEXIS 14561 at *6- *7 (S.D.N.Y. 1980).
Here, the contingent nature of the fee award, both from the point of view of eventual settlement
and the point of view of establishing eligibility for an award, also warrant the requested fee award. A
number of difficult issues, the adverse resolution of any one of which could have doomed the successful
prosecution of the action, were present here. As discussed above, attorneys’ fees in this case were not
only contingent but extremely risky, with a very real chance that Class Counsel would receive nothing
at all for their efforts, having devoted time and advanced costs. Class Counsel has previously invested
in cases which resulted in no recovery. (Declaration of Blumenthal, ¶ 10(e).)
Class Counsel were required to advance all costs in this litigation. Especially in this type of
litigation where the corporate defendants and their attorneys are well funded, this can prove to be very
expensive and risky. Accordingly, because the risk of advancing costs in this type of litigation can be
significant, it is therefore cost prohibitive to many attorneys. (Declaration of Blumenthal, ¶ 10(j)).
The financial burdens undertaken by Plaintiffs and Class Counsel in prosecuting this action on behalf
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28 12MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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of the Class were very substantial. To date, Class Counsel advanced more than $17,000 in costs which
could not have been recovered if this case had been lost. (Declaration of Blumenthal at ¶ 10(j)).
Plaintiff undertook the risk of liability for Defendant’s costs and fees had this case not succeeded, as
well as other potential negative financial ramifications from having come forward to sue Defendant on
behalf of the Class.
Accordingly, the contingent nature of the fee and the financial burdens on Class Counsel and
Plaintiffs also support the fee requested.
5. Awards in Similar Cases
The attorneys’ fees requested by Class Counsel are within the range of fees awarded in
comparable cases. A review of class action settlements over the past 10 years shows that the courts have
historically awarded fees in the range of 20% to 50%, depending upon the circumstances of the case.
In re Warner Communications, supra, 618 F.Supp. at 749-50. Class Counsels’ requested fees and costs
are 25% of the total value of the case, a percentage well within the range of reasonableness given the
excellent results obtained for the Class, the risks undertaken, and the skill of the prosecution. See
Vizcaino, supra, 290 F.3d at 1047-49 (approving 28% attorneys fee award as reflecting “the standard
contingency fee for similar cases”).
In In re Warner Communications, Judge Keenan concluded that percentage fees in common
fund cases range from 20% to 50%. Id., 618 F.Supp. at 749-50. Professor Newberg is in accord:
No general rule can be articulated on what is a reasonable percentage of a commonfund. Usually 50% of the fund is the upper limit on a reasonable fee award from acommon fund in order to assure that the fees do not consume a disproportionate part ofthe recovery obtained for the class, although somewhat larger percentages are notunprecedented.
Newberg, Newberg on Class Actions, 3rd Ed., § 14.03, at 14-13§§.
Some of the class action awards obtained by Class Counsel herein in similar overtime
employment actions throughout the state bear out the reasonableness of a fee and costs award
equivalent to 25% of the total settlement value:
On March 9, 2009, in Barcia v. Contain-a-Way, Inc., (U.S.D.C. Southern District of California),
the Honorable Irma E. Gonzalez, Chief Judge, awarded a 25% fee request to Class Counsel in an
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8 The Lodestar/Multiplier method is used in fee-shifting cases. Applied here,Lodestar/Multiplier method would also justify the requested award because the factors discussedabove support the reasonableness of an fee award with a modest 1.75 multiplier. See e.g., Vizcaino,supra, 290 F.3d at 1051 (3.65 multiplier approved because of substantial risk); Rievman v.Burlington Northern Railroad Co., 118 F.R.D. 29, 35 (S.D.N.Y. 1987) (“In recent years, multipliersbetween 3 and 4.5 have been common”); Amaral v. Cintas Corporation No. 2, 163 Cal. App. 4th
1157, 1174 (2008) (approving lodestar with a 1.65 multiplier in a fee-shifting case); Behrens v.Wometco Enterprises, Inc., 118 F.R.D. 534, 549 (S.D.Fla. 1988) (court applied multiplier of 3,
13MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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overtime class action. Barcia v. Contain-A-Way, Inc., 2009 U.S. Dist. LEXIS 17118, *15-18 (S.D.
Cal. 2009). (Declaration of Blumenthal at ¶11.)
On February 2, 2009, in Louie v. Kaiser Foundation Health Plan, (U.S.D.C. Southern District
of California), the Honorable Irma E. Gonzalez, Chief Judge, awarded a 25% fee request to Class
Counsel in an overtime class action. Louie v. Kaiser Found. Health Plan, Inc., 2008 U.S. Dist. LEXIS
78314 (S.D. Cal. 2009) (Holding that “[i]n wage and hour cases “[t]wenty-five percent is considered
a benchmark for attorneys' fees in common fund cases.”) (Declaration of Blumenthal at ¶11.)
On December 11, 2008, in Gruender et al. v. First American Title, (Orange County Superior
Court), the Honorable David C. Velasquez awarded a 25% fee request to Class Counsel in an overtime
class action. (Declaration of Blumenthal at ¶11.)
On November 12, 2008, in Connell v. Sun Microsystems (Alameda Superior Court Case No.
RG06252310), the Honorable Steven Brick awarded a 30% fee request to Class Counsel in an overtime
class action. (Declaration of Blumenthal at ¶11.)
An Attorneys’ Fee and Cost award equal to 25% of the common fund in this case is therefore
reasonable in light of the prevailing fees that have been awarded in other similar cases as set forth
above. Furthermore, it is certainly significant that not a single objection has been made to the fee
request.
D. Lodestar Cross-Check
In a common fund settlement “[t]he lodestar method is merely a cross-check on the
reasonableness of a percentage figure”. Vizcaino, supra, 290 F.3d at 1050, n.5. In this case,
consideration of Class Counsel’s overall lodestar as a cross-check to the percentage figure also strongly
supports the reasonableness of the requested fee award.8 Class Counsel seeks an attorneys’ fee award
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noting that this was "average" for a large complicated class action where multipliers ranged from2.26 to 4.5); Rabin v. Concord Assets Group Inc., [1991-1992 Transfer Binder] Fed. Sec. L. Rep.(CCH) Par. 96,471, at 92,081 (S.D.N.Y. 1991)(court applied multiplier of 4.4, noting thatmultipliers from 3 to 4.5 have commonly been awarded).
14MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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of $243,750 (equal to 25% of the Settlement Sum), and Class Counsel’s lodestar in this case as of
November 9, 2010 is $138,837.50. (Declaration of Blumenthal, ¶ 10(k).) Therefore, the requested fee
award as a percentage of the fund is equal to the lodestar incurred in this case with only a modest
multiplier of 1.75. As a result, using Class Counsel’s lodestar as a cross-check clearly establishes the
reasonableness of the requested fee award.
IV. CLASS COUNSEL’S COSTS WERE REASONABLY INCURRED
As part of the agreement, the parties agreed that Class Counsel shall be entitled to recoup their
reasonable litigation costs from the Settlement Sum, not to exceed $25,000. (Settlement Agreement
at Section 3.06(c).) Subject to Court approval, the Parties agreed that Settlement Class Counsel will
be paid reasonable and actual costs in prosecuting this litigation per Settlement Class Counsel's billing
statement
Class Counsel requests reimbursement for litigation expenses and costs in the amount of
$17,852.69 based upon counsel’s billing records, which is less than the agreed amount in the Settlement
Agreement. These expenses include the amounts paid for court filing fees, expert witness fees,
mediator fees, document copying fees, legal research charges, deposition travel expenses and delivery
charges, all of which are costs normally billed to and paid by the client. These costs were reasonably
incurred in the prosecution of this matter. (Declaration of Blumenthal, ¶ 13.)
V. THE REQUESTED SERVICE AWARD IS REASONABLE
Plaintiff respectfully submit that for her service as the Class Representative, the Named Plaintiff
Nimet Behar should be awarded $4,000 in accordance with the Settlement Agreement. Defendant has
agreed to the payment of this service award to the Plaintiff.
As the sole Representative of the Class, Plaintiff performed her duty to the Class admirably and
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28 15MEMORANDUM IN SUPPORT OF MOTION FOR AWARD OF ATTORNEY'S FEES AND EXPENSES
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without exception. Plaintiff provided valuable documents from her employment at Defendant which
were instrumental in Class Counsels’ understanding of the case. Plaintiff also responded to numerous
requests and correspondence from Class Counsel, providing invaluable assistance and information
which ultimately resulted in the Settlement now benefitting the Class. (Decl of Blumenthal at ¶12).
Plaintiff also assumed the risk , that she might possibly be liable for costs incurred in connection
with this case and being “blacklisted” by other future employers. Without Plaintiff’s support,
cooperation and information, no other fellow employees would be receiving any benefit.
The payment of service awards to successful class representatives is appropriate and the
amounts of $4,000 is well below the currently accepted range. See e.g. Van Vranken v. Atlantic
Richfield Co., 901 F.Supp. 294, 299-300 (N.D. Cal. 1995)(incentive award of $50,000); In re Dun &
