From Casetext: Smarter Legal Research

In re US Bancorp Litigation

United States Court of Appeals, Eighth Circuit
Jan 15, 2002
291 F.3d 1035 (8th Cir. 2002)

Summary

holding that a district court's awarding of attorney's fees amounting to 36% of the settlement fund did not constitute an abuse of discretion

Summary of this case from Johnson v. GMAC Mortgage Group, Inc.

Opinion

Nos. 01-1217, 01-1242.

Submitted: December 7, 2001.

Filed: January 15, 2002.

Appeal from the United States District Court for the District of Minnesota, Jonathan G. Lebedoff, United States Magistrate Judge.

N. Peter Knoll, Longmont, CO, David R. Jansen, Minneapolis, MN, William J. Lorence, Maple Grove, MN, for appellant.

Kay Nord Hunt, Philip A. Cole, Karl L. Cambronne, Minneapolis, MN, Mark Reinhardt, Hary H. Eckart, Garrett D. Blanchfield, St. Paul, MN, Seymour J. Mansfield, Richard J. Fuller, V. John Ella, Minneapolis, MN, William Kvas, Minneapolis, MN, Joseph Arshawsky, Albuquerque, NM, Peter Safirstein, New York City, Charles S. Zimmerman, Keelyn M. Friesen, Jennifer K. Sustacek, Minneapolis, MN, and Charles J. Johnson, New Brighton, MN, for appellees.

Before McMILLIAN, MORRIS SHEPPARD ARNOLD, and BYE, Circuit Judges.


In these consolidated appeals, Peter Knoll, David Jansen, and William Lorence appeal from the final judgment entered in the District Court for the District of Minnesota, approving a stipulated settlement agreement in a class action suit over their objections. Knoll, Jansen, and Lorence were unnamed class members who intervened after the settlement agreement had been approved. For reversal, they argue the district court judge should have disqualified himself because he had a financial interest in the litigation, the district court violated due process by giving class members only nine days to review attorneys' fee applications, and the district court erred in approving the settlement agreement and the fee award without stating its reasons on the record, and in determining the amount of the fee award. They also object to the costs award for class counsel and the incentive award for the representative plaintiffs. For the reasons discussed below, we affirm the judgment of the district court.

The Honorable Jonathan G. Lebedoff, United States Magistrate Judge for the District of Minnesota, to whom the case was referred for final disposition by consent of the parties pursuant to 28 U.S.C. § 636(c).

In June 1999, five named plaintiffs (the "class-action plaintiffs") brought the instant class action on behalf of a national class, seeking injunctive relief and damages because defendant U.S. Bank National (the "Bank") supplied confidential customer account information to unaffiliated third parties for marketing purposes. The class-action plaintiffs and the Bank entered into a stipulated settlement which provided as follows. The Bank would pay to a settlement fund $3 million, plus an amount equal to $2 million less than the amount the Bank paid in respect to a product-refund plan negotiated in a related case. (The parties reveal on appeal that the Bank paid more than $2 million in product refunds and thus this "pourover" provision did not apply.) The settlement fund would be used to pay class counsel up to $1,250,000 in fees and $40,000 in expenses; the Bank would provide funds for this purpose in the amount of 25% of the amount the Bank paid under the product-refund plan. The settlement fund also would be used to pay the class-action plaintiffs $2,000 each.

The class-action plaintiffs noted that, although over four million class members had received settlement notices, only a small fraction of the class — 0.9% — had raised objections. Specifically, Knoll, Jansen, and Lorence filed written objections and testified at the settlement fairness hearing. Knoll contended the settlement should be rejected because most class members would receive no compensation, the proposed fee award was excessive and unconscionable, its plan for distributing compensation was complicated and expensive, and the maximum amount of compensation was too low. Jansen argued the attorneys' fees were incommensurate to the victims' damages. Lorence claimed he had incurred over $4,000 in costs to change his banking relationships and to close numerous accounts. (Lorence's injuries were related to a former Bank employee's theft of Lorence's private files.)

After making all of the necessary determinations regarding the certification of the class and the class representatives, the district court approved the settlement as fair, reasonable, adequate, and in the class's best interest, and rejected the objectors' comments as insufficient to call into question the settlement's fairness and adequacy. The court also found the attorneys' fees and costs award to be fair and reasonable. Knoll, Jansen, and Lorence each intervened, and then appealed.

We initially find that the intervenors have standing to challenge the settlement award. See Croyden Assocs. v. Alleco, Inc., 969 F.2d 675, 680 (8th Cir. 1992) (unnamed class members must intervene to challenge adequacy of settlement on appeal), cert. denied, 507 U.S. 908, 113 S.Ct. 1251, 122 L.Ed.2d 650 (1993). We reject their arguments as meritless, however.

We need not revisit the intervenors' disqualification argument, as it was the subject of an earlier unsuccessful motion for limited remand filed by Knoll. In any event, the intervenors concede that they failed to raise the disqualification argument in the district court. See Alexander v. Pathfinder, Inc., 189 F.3d 735, 742 (8th Cir. 1999) (this court does not consider new arguments on appeal).

We find due process was satisfied. All objectors had an opportunity to be heard at the settlement hearing, and the intervenors raised their objections to the fee amount both at the hearing and in writing. See Goldberg v. Kelly, 397 U.S. 254, 267, 90 S.Ct. 1011, 25 L.Ed.2d 287 (1970) (fundamental requisite of due process of law is opportunity to be heard); DeBoer v. Mellon Mortgage Co., 64 F.3d 1171, 1176 (8th Cir. 1995) ( DeBoer) (due process satisfied where class members received notice of settlement proposal and were able to argue their objections to district court), cert. denied, 517 U.S. 1156, 116 S.Ct. 1544, 134 L.Ed.2d 648 (1996).

We also find the district court adequately stated its reasons for approving the settlement agreement and the fee award by stating on the record that the agreement was fair and reasonable and by rejecting the objectors' arguments. Besides, the intervenors have not shown the record establishes that the agreement was unfair. See DeBoer, 64 F.3d at 1177 (in absence of specific findings regarding fairness of settlement, this court assumes district court did not abuse its discretion unless record establishes to contrary).

As to the fee award, class counsel explained that the requested fee would be 25% of the total settlement value if an additional $2 million pourover amount was paid into the fund, or 36% of the guaranteed $3.5 million fund amount. Because the pourover amount was not paid into the fund, the $1.25 million fee award represents approximately 36% of the settlement fund. We have approved the percentage-of-recovery methodology to evaluate attorneys' fees in a common-fund settlement such as this, see Petrovic v. Amoco Oil Co., 200 F.3d 1140, 1157 (8th Cir. 1999), and we find no abuse of discretion in the district court's awarding 36% to class counsel who obtained significant monetary relief on behalf of the class, see id. at 1156 (district court's decisions regarding attorneys' fees in class action settlement will generally be set aside only upon showing of abuse of discretion; to recover fees from common fund, attorneys must demonstrate that their services were of some benefit to fund or enhanced adversarial process).

As to the costs and incentive awards, we find the $40,000 cost award to class counsel for their out-of-pocket expenses was appropriate, see Keslar v. Bartu, 201 F.3d 1016, 1017 (8th Cir. 2000) (per curiam) (finding no abuse of discretion in $17,000 cost award when case settled for $70,000), and that the $2,000 awarded to the five representative plaintiffs also was appropriate, see Cook v. Niedert, 142 F.3d 1004, 1016 (7th Cir. 1998) (relevant factors in deciding whether incentive award to named plaintiff is warranted include actions plaintiff took to protect class's interests, degree to which class has benefitted from those actions, and amount of time and effort plaintiff expended in pursuing litigation).

Accordingly, we affirm.


Summaries of

In re US Bancorp Litigation

United States Court of Appeals, Eighth Circuit
Jan 15, 2002
291 F.3d 1035 (8th Cir. 2002)

holding that a district court's awarding of attorney's fees amounting to 36% of the settlement fund did not constitute an abuse of discretion

Summary of this case from Johnson v. GMAC Mortgage Group, Inc.

finding no abuse of discretion in "$1.25 million fee award represent[ing] approximately 36% of the settlement fund

Summary of this case from Vogt v. State Farm Life Ins. Co.

finding "no abuse of discretion in the district court's awarding 36% to class counsel who obtained significant monetary relief on behalf of the class"

Summary of this case from Khoday v. Symantec Corp.

finding "no abuse of discretion in the district court's awarding 36% to class counsel who obtained significant monetary relief on behalf of the class"

Summary of this case from Knutson v. Sprint Commc'n Co. L.P.

finding no abuse of discretion in 36% fee award

Summary of this case from Desert Orchid Partners, L.L.C. v. Transaction Sys. Arch.

finding out-of-pocket costs awards to class counsel appropriate

Summary of this case from In re Charter Communications, Inc.

concluding that district court did not abuse its discretion by applying percentage-of-the-benefit method to award "36% of the guaranteed $3.5 million fund amount," where class counsel "obtained significant monetary relief on behalf of the class"

Summary of this case from Plaintiffs' Lead Counsel v. Life Time Fitness, Inc. (In re Life Time Fittness, Inc.)

concluding that a district court's attorney fee award of 36% of a class action settlement fund was not an abuse of discretion

Summary of this case from Meller v. Bank of the W.

upholding an award of 36% of a $3.5-million common fund

Summary of this case from Woodard v. Navient Sols.

upholding award of attorneys' fees amounting to 36% of settlement fund of $3.5 million

Summary of this case from Equal Employment Opportunity Com. v. Faribault Foods

affirming attorneys' fee award of 36% in class action settlement

Summary of this case from Huyer v. Buckley

affirming $2,000 award to five representatives

Summary of this case from Vogt v. State Farm Life Ins. Co.

affirming class attorneys' award of one-third

Summary of this case from Martinez v. Medicredit, Inc.

affirming award of 36%

Summary of this case from Morgan v. Pub. Storage

affirming fee award of 36% of $3.5 million settlement fund, plus separate $40,000 award for expenses

Summary of this case from Barfield v. Sho-Me Power Elec. Cooperative

affirming district court's award of 36 percent of settlement fund as attorney's fees

Summary of this case from West v. PSS World Med., Inc.

affirming district court's award of 36% of the common settlement fund as attorneys' fees

Summary of this case from In re Iowa Ready-Mix Concrete Antitrust Litig.

affirming district court's award of 36% of the common settlement fund as attorneys' fees, where "class counsel . . . obtained significant monetary relief on behalf of the class"

Summary of this case from In re Iowa Ready-Mix Concrete Antitrust Litig.

affirming fee award representing 36% of the settlement fund as reasonable

Summary of this case from Yarrington v. Solvay Pharmaceuticals, Inc.

approving an award of $2,000 to each of five representative plaintiffs where the common fund consisted of $5 million to be split among a class of four million

Summary of this case from Vassalle v. Midland Funding LLC

approving $2,000 incentive awards to five named plaintiffs out of a class potentially numbering more then 4 million in a settlement of $3 million

Summary of this case from Staton v. Boeing Co.

approving 36% fee award

Summary of this case from Morrison v. Entrust Corp.

approving an award of 36% of the settlement fund

Summary of this case from Lechner v. Mut. of Omaha Ins. Co.

approving incentive awards of $2,000 to 5 named plaintiffs out of a class potentially numbering more than 4 million members in a settlement of $3 million

Summary of this case from Mora v. CAL W. Ag Servs., Inc.

approving $2,000 award to five class representatives

Summary of this case from Komoroski v. Util. Serv. Partners Private Label, Inc.
Case details for

In re US Bancorp Litigation

Case Details

Full title:In re US BANCORP LITIGATION, also known as U.S. Bank National Association…

Court:United States Court of Appeals, Eighth Circuit

Date published: Jan 15, 2002

Citations

291 F.3d 1035 (8th Cir. 2002)

Citing Cases

In re Iowa Ready-Mix Concrete Antitrust Litig.

District courts have broad discretion in determining appropriate attorneys' fees following a class action…

Khoday v. Symantec Corp.

"A routine calculation of fees involves the common-fund doctrine, which is based on a percentage of the…