LANSING – Emotions rose Thursday during a hearing on how much cash lawyers should take out of a proposed $ 641.25 million partial civil lawsuit resulting from lead poisoning of Flint’s drinking water.
A lawyer said he was pilloried by some local residents, including one who wants to know if he wants to buy a yacht with the proceeds.
Another accused an attorney of criticizing the charges as excessive because they were covertly funded by large corporations such as oil and tobacco companies that seek to root out class actions and mass crimes that they can hold accountable for their crimes.
In a March filing, attorneys called for up to $ 202.8 million in legal fees – a motion that has sparked outrage and condemnation among many residents of Flint and others.
Senior attorneys defended the motion, stating that they and attorneys from about 30 other law firms worked 182,000 hours together on the case over the past five years, battling a deep-sunken Michigan state that is making immunity and other defense claims had to go to the Michigan Supreme Court and the US Supreme Court before lengthy and difficult negotiations resulted in a proposed settlement.
It is up to U.S. District Judge Judith Levy to decide whether both the settlement itself – and the legal fees – are fair.
New York attorney Corey Stern, one of the lead liaison attorneys for individual plaintiffs in the mass offense portion of the settlement, expressed outrage at the way appellants have approached the legal fees issue, which is reflected in both media coverage and public response.
“I have received 470 emails since May 1 related to my behavior,” said Stern. In the last email, received Thursday morning, he was asked to say in court, “whether or not I intend to buy a yacht,” he said.
“I can’t buy anything,” said Stern.
No attorney involved in the litigation has received $ 1, despite having paid at least $ 7 million in spending on top of the 182,000 hours they worked, “with no guarantee that we would get even $ 1. Get dollars back, ”he told the court during an online hearing.
Even objections to the fees agree that attorneys deserve compensation for the risk they took in taking on the litigation with no guarantee of recovery.
But Frank Bednarz, an attorney with the Center for Class Action Fairness at the Hamilton Lincoln Law Institute in Washington, DC, said it would be an exaggeration for attorneys to take on nearly a third of the proposed settlement as requested. Courts in other “mega-fund” cases across the country have found that as the gross settlement amount increases, the percentage paid to lawyers should generally decrease, he said.
“It’s not necessarily 600 times harder to get a $ 600 million deal than it is to get a $ 1 million deal,” Bednarz said.
Bednarz, who disapproves of the charges on behalf of Flint clients, wants Levy to allow him and other lawyers to review detailed time and accounting records that lawyers presented to the special master on the case and that Levy has privately reviewed.
More:Flint Water Crisis Legal Fees: Who Would Get How Much of the $ 203 Million, and Why?
More:Concern about legal fees at Flint Water Estate is growing. Here’s why.
Bednarz said based on the limited information he was able to verify, he had already identified an issue where one law firm was citing millions of dollars in work done by the firm’s own lawyers at an hourly rate of $ 500 an hour, although the work was in fact almost everything was done by contract lawyers who he believes would have been paid closer to $ 50 an hour.
“We can not report problems if we do not know anything about it,” said Bednarz and pleaded for access to further accounting documents.
Levy has not made a decision on this request, but she stressed to Bednarz that the lawyers would not be paid based on the time records they submitted. Instead, the time records are a way to check that the requested percentage fees are not out of order, she said.
Bednarz also wants disclosures about fee-sharing agreements between the firms involved in the case.
Paul Napoli, a New York City attorney whose firm is the other senior liaison attorney for individually represented plaintiffs and who offered controversial bone scanning services to Flint residents to document their exposure to toxic lead, accused Bednarz of acting in bad faith.
Napoli said the Hamilton Lincoln Law Institute has ties to the Competitive Enterprise Institute, a Washington, DC libertarian think tank funded by large corporations that “seek to undermine the rights of people like those in Flint.”
Bednarz said his institute left the Competitive Enterprise Institute some time ago and “hasn’t received a penny from a company since.” Bednarz said he does not hold the views Napoli attributes to him and, even if so, it would be irrelevant to his arguments in this case.
Levy said the maximum legal fees – even if the application is fully upheld – will likely be lower than previously cited and closer to 29%, or $ 186 million. But that overhaul would not mean that the Flint plaintiffs would have more money to spend. Instead, it means that the costs to claims administrators and others whose job it will be to manage the settlement – which must also come out of the grand total – will likely be higher than the attorneys estimated in their fee application, she said.
Under the proposal, the four lead attorneys would share a joint performance fee of 6.33%, added to the total settlement amount, for their work, which will benefit all attorneys in the case. All other legal fees would be capped at 27%.
Contact Paul Egan: 517-372-8660 or firstname.lastname@example.org. Follow him on Twitter @ paulegan4. Read more about Michigan politics and sign up for our newsletter to vote.
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