Opinion
98 CV 3287 (JBW)
September 26, 2001
Paul J. Bschorr, Esq., Vincent R. FitzPatrick, Jr., Esq., Michael Hefter, Esq., Heather K. McDevitt, Esq., Dewey Ballantine LLP, New York, NY, For Plaintiffs Blue Cross, et al.
Martha J. Talley, Esq., Dewey Ballantine LLP, Washington, DC, For Plaintiffs Blue Cross, et al.
Murray R. Garnick, Esq., Arnold Porter, Washington, DC, For Defendant Philip Morris, Incorporated.
Kevin J. Dunne, Esq., Sedgwick, Detert, Moran Arnold, San Francisco, CA, For Defendant Philip Morris, Incorporated.
James T. Conlon, Esq., Sedgwick, Detert, Moran Arnold, New York, NY, For Defendant Philip Morris, Incorporated.
David M. Covey, Esq., Sedgwick, Detert, Moran Arnold, New York, NY, For Defendant Brown Williamson Tobacco Corporation.
Kenneth N. Bass, Esq., Kirkland Ellis, Washington, DC, For Defendant Brown Williamson Tobacco Corporation.
Alan Mansfield, Esq., Greenberg Traurig, LLP, New York, NY, For Defendants Lorillard Tobacco Company, Lorillard, Inc.
Gary R. Long, Esq., Shook, Hardy Bacon, LLP, Kansas City, MO, For Defendants Lorillard Tobacco Company, Lorillard, Inc.
Steven Klugman, Esq., Debevoise Plimpton, New York, NY, For Defendant Council for Tobacco Research, U.S.A., Inc.
Barry S. Schaevitz, Esq., Jacob, Medinger Finnegan, LLP, New York, NY, For Defendant Smokeless Tobacco Council, Inc.
R. Dal Burton, Esq., Womble, Carlyle, Sandridge, Rice, PLLC, Atlanta, GA, For Defendants R.J. Reynolds Tobacco Co., and RJR Nabisco, Inc.
Thomas D. Schroeder, Esq., Ursula M. Henninger, Esq., Womble, Carlyle, Sandridge, Rice, PLLC, Winston-Salem, North Carolina, For Defendants R.J. Reynolds Tobacco Co., and RJR Nabisco, Inc.
John B. Williams, Esq., Collier, Shannon, Rill, Scott, PLLC., Washington, D.C., For Defendants R.J. Reynolds Tobacco Co., and RJR Nabisco, Inc.
Thomas J. McCormack, Esq., Chadbourne Parke LLP, New York, NY, For Defendant British American Tobacco (Investments) Limited (formerly known as British-American Tobacco Company Limited).
Joseph McLaughlin, Esq., Simpson Thacher Bartlett, New York, NY, For Defendant BAT Industries P.L.C.
Bruce M. Ginsberg, Esq., Davis Gilbert, LLP, New York, NY, For Defendant Hill Knowlton, Inc.
Leonard Feiwus, Esq., Kasowitz, Benson, Torres Friedman LLP, New York, NY, For Defendants Liggest Group Inc., Liggest Myers, Inc., and Brooke Group Ltd.
Anthony R. Mansfield, Esq., Seward Kissel, New York, NY, For Defendant The Tobacco Institute, Inc.
MEMORANDUM ORDER
After a verdict for the plaintiff under New York General Business Law section 349, the court requested the parties to submit briefs and prepare for a hearing in response to plaintiff's request for statutory fees and other relief.
In preparation for the hearing, the court indicated some of the possible considerations it would have in measuring the award. They are set out below without citation.
In determining statutory fees under section 349 of New York's General Business Law, the following criteria may be considered:
(1) The fees allowed should be sufficient to attract excellent attorneys who will devote their full resources, appropriate to the case.
(2) Fees should not be so great as to encourage poor cases to be litigated or excessive resources dedicated to the job on the theory that defendants will be "compelled" to settle because of the threat of huge fees, or on the gamble that the large fee may be allowed in an occasional "successful" suit, overcoming losses when litigations fail.
(3) Fees should not be disproportionate to the probable value of the case. Probable value is reflected to a considerable degree in the reality of what was obtained in the actual suit.
(4) Cost of support to the lawyers by advice from experts, work of paraprofessionals technicians, and other resources is appropriate. These billable fee expenses must be distinguished from costs under Rule 54 (d) of the Federal Rules of Civil Procedure. Expert fees for preparation of reports, depositions and testimony are not available as statutory fees.
(5) Generally, the fee should not be greater than counsel actually would earn were the case "successful" since it is compensation to the client for its potential out-of-pocket expenditures. The attorney's experience, ability and reputation should be considered in determining the fee that probably would have been earned. Where the recovery is relatively small or the contribution to the law is great this limit should not be observed.
(6) The fee should be reduced by a proportion that would not have been necessary had other theories not been incorporated in the suit. Leeway for imaginative use of other supporting theories should be allowed. The initiative and imaginative expansion of the law by plaintiff's counsel should not be suppressed.
(7) Unnecessary inefficiency or wasteful overstaffing, or duplicative work should not be rewarded or encouraged. Legal research, writing, and litigation in a new field almost always will lead up some blind alleys and require backtracking; the fee should recognize this aspect of the lawyer's creative work.
(8) The hourly rate or percentage of recovery, or combination of the two, should not exceed the norm for the legal community (national, regional or local as may be appropriate).
(9) The specifics of any contingency or other fee arrangement with the client are not decisive but may be considered.
(10) An actual payment of attorneys' fees is not a condition precedent to a recovery.
(11) The work of opposing counsel and the fees they required in defense illuminates the reasonableness of plaintiff's counsel's requested fee.
(12) The trial court's experience with the case and similar cases bears on the award. A precise mechanical formulae is not possible. In general, the federal lodestar method, while not binding in state substantive law cases, is an acceptable and readily applicable method even in Erie cases. Moderation is desirable.
(13) In short, the court should attempt a melding of appropriate criteria, looking to the purpose of the statue at issue. It should consider the time and skill required in litigating the particular case, the complexity of the issues, the customary fee for the work, the results achieved, the lawyer's experience, ability and reputation, the amount in dispute, the potential benefit to the client, the benefit to society, and the responsibility assumed by the lawyer.
It is emphasized that these considerations are tentative. They are for the guidance of the parties in preparation of their briefs if they appear to be useful.
SO ORDERED