Order Regarding Plaintiffs’ Petition for an Award and Allocation of Common Benefit Attorneys’ Fees and Expenses, and Memorandum in Support, In re Ethicon Physiomesh Flexible Composite Hernia Mesh Prod. Liab. Litig., MDL No. 2783, (N.D. Ga. Nov. 14, 2022).
Under Eleventh Circuit precedent, an attorney’s fee award “shall be based upon a reasonable percentage of the fund established for the benefit of the class.” In re Equifax, Inc. Customer Data Security Breach Litig., 999 F.3d 1247, 1278 (11th Cir. 2021) (citing Camden I Condo. Ass’n, Inc. v. Dunkle, 946 F.2d 768 (11th Cir. 1991)). . . . While such is not required in the Eleventh Circuit, courts also sometimes apply a rough lodestar “cross-check” to assess the reasonableness of the percentage-based fee. . . .
In the Eleventh Circuit, the percentage method requires a district court to consider a number of relevant factors called “the Johnson factors” in order to determine if the requested percentage is reasonable. In re Equifax, supra at 1278 (citing Johnson v. Ga. Highway Express, Inc., 488 F.2d 714 (5th Cir. 1974)).
(1) The Value of the Benefits of the Settlement and the Degree of Success Obtained (Johnson factor 8).
As recognized in Deepwater Horizon, 2016 WL 6215974 at *18, “the most critical factor in determining the reasonableness of a fee award is the degree of the success obtained,” and “[s]uccess is determined not only by the gross amount of the recovery but also by the number of individuals who benefit from the class settlement, the degree to which it provides them with full compensation for their injuries, and the extent to which the settlement benefits the public at large.” (citing, inter alia, Vioxx, 760 F. Supp. 2d at 657-68; In re Diet Drugs Prods. Liab. Litig., 553 F.Supp.2d 442, 472-73 (E.D. Pa. 2008), aff’d, 582 F.3d 524 (3rd Cir. 2009)). . . .
Here, the current total value of all settlements subject to the common benefit assessment is confidential and has been provided to the Court under seal, and this amount has likewise been provided to counsel with Plaintiffs eligible for participation in the global settlement. This confidential amount includes the resolution of up to 3,600 individual claims—including the MDL plaintiffs and plaintiffs in the related New Jersey state court MCL at the time the settlement was reached.
Where, as here, the settlement may involve payments over a period beyond the point the common benefit fee is determined, the settlement fund also includes a “reasonable estimate” of the amount of future payments that are expected to be made to the plaintiffs. Deepwater Horizon, supra at *15 (“Where the settlement provides benefits on a ‘pay-as-you-go’ basis over a period beyond the point that a common benefit fee is to be awarded, the settlement fund also includes a reasonable estimate of the amount of future payments that will be made to claiming class members.”). . . .
Based upon the number of cases that will be resolved pursuant to a master settlement agreement and recently-filed cases remaining in the litigation that have not yet become part of any settlement agreement, and in light of the value of the master settlement agreement, the Plaintiffs’ leadership has provided their reasonable expectation of the final total value of all settlements and judgments to the Court under seal.
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For years, this Court worked directly with the parties in this litigation and their representative counsel to facilitate the potential for resolution in cases before this Court. This Court is well aware of the nature and quality of the work that was required by Plaintiffs’ leadership to work up multiple cases for trial and to ultimately negotiate and achieve a global settlement in this hard-fought litigation. The Court is familiar with the complicated factual and legal issues involved in these complex cases that comprise this litigation, and which would impact the value of any individual case.
The Court finds that the coordinated efforts by Common Benefit Counsel helped to level the playing field and reduce the bargaining power otherwise enjoyed by the Defendants. For the benefit of all plaintiffs, Common Benefit Counsel helped administer the MDL by establishing uniform procedures and protocols intended to promote efficiency and economy and has been a repository for information to assist all plaintiffs’ counsel. Common Benefit Counsel secured many important discovery, evidentiary and substantive rulings that apply on a litigation-wide basis. In the absence of MDL leadership’s efforts over the past several years to continue developing cases for trial, to defeat dispositive motions, and to win important pretrial victories for plaintiffs, the willingness of any of these defendants to pursue a global settlement strategy would have been negatively impacted. The overall coordination and collaboration by Common Benefit Counsel in the MDL, which provided all plaintiffs access to the same medical, scientific and legal expertise, influenced these defendants’ decision to invest in settlement of the cases in this MDL and in the related New Jersey State Court Physiomesh litigation.
The value of the benefit provided to the clients in this litigation is substantial and supports an award of the previously-ordered holdback amount of 9% as compensation for fees.
(2) Examination of Awards for Common Benefit Work in Comparable Cases and the Benchmark Percentage.
In In re Xarelto (Rivaroxaban) Prods. Liab. Litig., 2020 WL 1433923 (E.D. La. 2020), Judge Fallon entered a common benefit award of 12% in a product liability MDL settlement totaling $775,000,000, . . . .
Similarly, in In re National Football League Players Concussion Injury Litig., 2018 WL 1635648 (E.D. Pa. 2018), the MDL court entered an order awarding attorney’s fees of 11% in a settlement involving a fund with a present value of $982.2 million, citing a study provided by plaintiffs’ counsel in that case showing that “the average fee award for class settlements is 13.7% nationwide with a median of 9.5%.” (citing Brian T. Fitzpatrick, An Empirical Study of Class Action Settlements and Their Fee Awards, J. Empirical Legal Studies, Vol. 7, Issue 4, pp. 811-846 (Dec. 2010)). . . .
Analysis of other common benefit fee awards in similar product liability MDLs and other litigations involving similar-sized settlements to the global settlement achieved here further underscores the reasonableness of a 9% fee award in this MDL. . . .
(3) Analysis of the Reasonableness of the Percentage Based Upon the remaining Johnson Factors.
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(a) Time and Labor Required (Factor 1); Attorneys’ Opportunity Costs In Pressing Litigation (Factor 4); Time Limitations Imposed by the Circumstances (Factor 7)
The time and labor required to move this litigation forward is reflected in the number of Common Benefit hours that have been submitted by Common Benefit Counsel, 50,993.25 total hours. However, Plaintiffs’ leadership’s work continues, primarily the responsibility of managing and administering the global settlement process and to bring all 3,600 MDL cases and related New Jersey State Court Physiomesh cases to a resolution. . . .
Much like in In re Xarelto. . . . “[Plaintiffs’ leadership] Counsel [in this MDL] had to negotiate trial plans and coordinate various schedules, engage in extensive discovery involving millions of pages of documents from Defendants and third parties, develop Plaintiff and Defendant Profile Forms, oversee bundled complaints and expend . . . . thousands of hours on pleadings and complex motions practice,” the work-up of trial pool cases, and leadership “devoted itself to negotiating the terms of a private Settlement Agreement, which itself was time- and labor-intensive and complex.” See also, Id. at *7. . . . The opportunity costs and time limitations imposed by the circumstances of this MDL were likewise onerous. For a number of years, the amount of time and effort necessary to develop and coordinate this litigation—and the complex and time-consuming negotiation of a global settlement agreement with Defendants—significantly limited involvement in other matters for the lawyers responsible for spearheading this litigation. . . . Plaintiffs’ counsel also had to overcome the onerous challenges of moving this litigation forward during the unprecedented COVID pandemic that struck while trial pool cases were scheduled for trial. The burdens of funding this litigation through PSC contributions and millions of dollars in held costs strained the resources of Plaintiffs’ leadership. Indeed, for some of the firms involved in leadership who were directly responsible for coordinating and leading the litigation, the work required to pursue this litigation seriously limited, if not precluded their involvement in other litigation. Particularly the work relating to negotiating, achieving and overseeing a settlement process that includes all MDL plaintiffs and all plaintiffs in the related New Jersey state court litigation undoubtedly required constant attention and consistent effort.
(b) The Novelty and Difficulty of the Questions (Factor 2); The “Undesirability” of the Case (Factor 10)
Individually, the cases in this MDL involve complex prescription medical devices, implanted by surgeons through an invasive surgical procedure. Thus, the Plaintiffs’ leadership was not only required to address the difficult legal questions that arise in product liability cases generally, but also had to navigate the unique regulatory, scientific and medical issues presented in these cases. . . .
The disputed issues involved in these cases included a wide range of complicated scientific, medical and legal questions. Merely understanding from a scientific and medical perspective what was “wrong” with the Physiomesh product and with the defendants’ product warnings, and how these defects caused the plaintiffs’ injuries, required extensive study and research. All of these issues were, of course, bitterly disputed by the defendants. . . . There was nothing routine or easy about these cases.
This litigation has also been hard-fought by the multiple defense firms involved. The defense fought to defeat the Plaintiffs’ cases, filing dispositive motions on nearly every claim in every case that moved toward trial, Daubert challenges against nearly every one of plaintiffs’ experts, attempts to limit Plaintiffs’ counsel’s ability to meet with treating doctors, efforts to curtail the Plaintiffs’ ability to put on evidence through in limine motions and other means, and attempts to inject regulatory-related defenses into these cases. . . .
Finally, with respect to the desirability of this litigation, the prospects of litigating a complex product liability MDL against a multi-national corporate defendant, defended by multiple top U.S. defense law firms, were daunting from the outset. The past few years of hotly-contested litigation have proven that these cases would be strongly defended. The risks and costs associated with leading this litigation have remained onerous from the beginning. . . . Again, while unanticipated at the outset, the COVID crisis only exacerbated the risks and difficulties Plaintiffs’ leadership had to overcome. Leading this litigation required fortitude and persistence, as well as substantial financial sacrifice. The well-represented corporate defendants litigated this MDL fiercely. Given the substantial costs per trial for the trial pool cases, the impediments to pursuing these cases were enormous.
(c) The Skill Required to Properly Perform the Legal Service (Factor 3); The Experience, Reputation, and Ability of the Attorneys (Factor 9)
Managing this complex medical device product liability MDL necessitated the involvement of some of the country’s most experienced and knowledgeable attorneys in this area of the law. The lawyers appointed by the Court to lead the litigation on plaintiffs’ behalf in this MDL include attorneys from law firms from across the United States with significant experience in the area of mesh litigation. These attorneys and law firms involved in Plaintiffs’ leadership specialize in representing individuals who have suffered injury from prescription drugs and medical devices and have significant experience in mesh litigation developed over many years. The collection of attorneys necessarily included a broad array of experience and skills, from the conduct of electronic discovery and analysis of voluminous document production, to motions and briefing, to deposing experts and corporate representatives and preparing to take these complex cases to trial. . . . This collective experience, knowledge and skill was vital to the success of the litigation, as these cases were defended by teams of attorneys from some of the nation’s largest, most experienced and capable defense firms. . . . The fact that the plaintiffs have been able to withstand the legal firepower brought to bear by these highly-skilled and experienced defense firms to achieve a global settlement for which all MDL plaintiffs are eligible is a testament to the experience, skill and ability of Plaintiffs’ leadership.
(d) Whether the Fee is Fixed and Contingent (Factor 6)
The Court’s analysis under the Johnson factor regarding whether the fee is fixed or contingent looks to the beginning of the case with an evaluation of the serious risks of non-recovery faced by Plaintiffs’ leadership when they committed themselves to this litigation on a contingency basis. . . . This factor further supports the requested common benefit award. E.g., In re Diet Drugs, 553 F. Supp. 2d at 479 (“At the inception, and throughout this litigation, there was a substantial risk that the efforts of the Joint Fee Applicants would not be successful.”)
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(4) Even though not required under Eleventh Circuit precedent, the Nine-Percent (9%) Fee is Supported by the “Lodestar” Cross-Check.
Again, as noted in In re Equifax, supra at 1278, there is no requirement in the Eleventh Circuit for a lodestar “cross-check” where the percentage fee award is reasonable according to the Johnson factors. See also, In re Abilify (Aripiprazole) Prods. Liab. Litig., 2019 WL 7859557, *8 at n. 57 (N.D. Fla. 2019) (citing several cases and noting “[t]he 11th Circuit does not require that a lodestar cross-check be done in determining common benefit fee awards.”). Nonetheless, the lodestar crosscheck here further serves to underscore the reasonableness of a 9% fee award.
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Irrespective of what hourly rate were to be selected for the cross-check, the number of hours already expended in this litigation would yield a multiplier that would fall well within the range of reasonableness for similar litigations. Obviously, application of different hourly rates would yield a different lodestar multiplier, but the multiplier would still fall squarely within the range that courts have deemed reasonable irrespective of the hourly rate that one chose to utilize.
In Kay Co. v. Equitable Production Co., 749 F. Supp. 2d 455, 470 (S.D.W. Va. 2010), the court recognized that “Courts have generally held that lodestar multipliers falling between 2 and 4.5 demonstrate a reasonable attorneys’ fee.” This is consistent with the range of similar multipliers that courts have found reasonable as set forth in the chart contained within Co-Lead Counsel’s Petition. . . .
Again, whatever hourly rate is employed to perform the lodestar cross-check, the Court finds that the lodestar multiplier supports the reasonableness of the fee requested by the FCC.
