Narrative Opinion Summary
In a class action lawsuit against Asarco Incorporated, the plaintiffs alleged environmental contamination caused by Asarco’s local smelter, culminating in a $67.5 million settlement. This settlement included provisions for medical monitoring, property value assurance, and cash payments, with a significant portion contingent on insurance recovery. The court approved $8 million in attorney fees and $1.6 million in expenses, utilizing a lodestar method with a multiplier of 2.0. Asarco objected to the multiplier, arguing it was unjustified under the circumstances and inconsistent with the Supreme Court's ruling in City of Burlington v. Dague on contingency multipliers. Nevertheless, the court upheld the award, citing the contractual nature of the fee agreement and exceptional outcomes achieved by class counsel. The court employed both a lodestar and percentage method for fee assessment, determining the $8 million fee was reasonable as it represented only 12% of the settlement. Judge Dwyer affirmed the reasonableness of the fee and settlement value, concluding the fee calculation methods were valid within the context of this complex settlement. The Ninth Circuit upheld these decisions, emphasizing the discretion afforded to district courts in determining fee awards in class action settlements.
Legal Issues Addressed
Attorney Fees in Class Action Settlementssubscribe to see similar legal issues
Application: The court determined that the $8 million in attorney fees was 'fair and reasonable' based on a lodestar calculation with a multiplier of 2.0.
Reasoning: The court ultimately awarded $8 million in fees and $1.6 million in expenses, deeming this amount 'fair and reasonable.'
Contingent Risk Multipliersubscribe to see similar legal issues
Application: The court justified the use of a 2.0 multiplier despite Asarco's objections, considering it reasonable under the contractual 'reasonable fee' standard.
Reasoning: Asarco challenged the 2.0 multiplier, arguing that contingent-risk multipliers are not permissible when the defendant pays fees and that the factors considered were already included in the lodestar calculation.
Evaluation of Settlement Valuesubscribe to see similar legal issues
Application: The court deemed the $67.5 million settlement value reasonable for calculating attorney fees, despite challenges related to non-guaranteed components.
Reasoning: Faced with a complex settlement structure that provided multiple benefits to class members, the court stated that determining the actual recovery value for fee percentage calculations was unfeasible, necessitating an estimation of total settlement value.
Fee Percentage of Settlementsubscribe to see similar legal issues
Application: The court used a percentage method to assess attorney fees, concluding that $8 million represented 12% of the settlement value, which was considered reasonable.
Reasoning: The district court also utilized a percentage method to assess the fee, determining that the $8 million award represents only 12% of the class's recovery.
Use of Lodestar and Multiplier in Fee Calculationsubscribe to see similar legal issues
Application: The district court used a lodestar calculation plus a multiplier to determine attorney fees, justifying a 2.0 multiplier based on several factors.
Reasoning: The court utilized a time-based calculation plus a multiplier, settling on a multiplier of 2.0 after evaluating factors such as the contingent risk faced by plaintiffs' attorneys, the quality of Asarco's opposition, ongoing responsibilities of class counsel, their work quality, and the case outcomes.