Hohenberg v. Ferrero USA, Inc
Filing
114
MOTION for Settlement Motion for Final Approval of Class Action Settlement, MOTION for Attorney Fees Motion for Attorneys' Fees, Costs, and Incentive Awards by Athena Hohenberg, Laura Rude-Barbato. (Attachments: # 1 Memo of Points and Authorities in Support of Motion for Final Settlement Approval (Redacted Version), # 2 Memo of Points and Authorities in Support of Motion for Approval of Attorneys' Fees, Costs, and Incentive Awards (Redacted Version), # 3 Declaration of Ronald A. Marron, # 4 Declaration of Jack Fitzgerald, # 5 Declaration of Athena Hohenberg, # 6 Declaration of Laura Rude-Barbato, # 7 Affidavit of Charlene Young)(Fitzgerald, John) (ag).
1 LAW OFFICES OF RONALD A.
MARRON, APLC
2 RONALD A. MARRON (175650)
3 ron@consumersadvocates.com
MAGGIE REALIN (263639)
4 maggie@consumersadvocates.com
B. SKYE RESENDES (278511)
5 skye@consumersadvocates.com
3636 4th Avenue, Suite 202
6 San Diego, California 92103
(619) 696-9006
7 Telephone:
Facsimile:
(619) 564-6665
8
THE WESTON FIRM
GREGORY S. WESTON (239944)
greg@westonfirm.com
JACK FITZGERALD (257370)
jack@westonfirm.com
MELANIE PERSINGER (275423)
mel@westonfirm.com
COURTLAND CREEKMORE (182018)
courtland@westonfirm.com
1405 Morena Blvd. Suite 201
San Diego, CA 92110
Telephone:
(619) 798-2006
Facsimile:
(480) 247-4553
9 Class Counsel
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UNITED STATES DISTRICT COURT
12
CENTRAL DISTRICT OF CALIFORNIA
Case No. 3:11-cv-00205-H-KSC
Pleading Type: Class Action
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IN RE FERRERO LITIGATION
DECLARATION OF JACK
FITZGERALD IN SUPPORT OF
PLAINTIFFS’ MOTIONS FOR FINAL
APPROVAL AND APPROVAL OF
ATTORNEY FEES AND INCENTIVE
AWARD
Judge: The Honorable Marilyn L. Huff
Hearing: July 9, 2012
Time: 10:30 a.m.
Location: Courtroom 13
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 I, Jack Fitzgerald, declare:
2
1.
I am Class Counsel in this action. I am a member in good standing of the State Bars of
3 California and New York; and of the United States District Courts for the Northern, Central and
4 Southern Districts of California and the Southern and Eastern Districts of New York; and of the United
5 States Court of Appeals for the Ninth Circuit. I make this Declaration in support of Plaintiffs’ Motions
6 for Final Settlement Approval and Approval of Attorney Fees and Inventive Awards.
7
8
Discovery
2.
Plaintiffs served Ferrero two sets of Requests for Production, on March 23 and October
9 12, 2011. Ferrero responded to the first set on April 8, 2011, and Class Counsel reviewed the many
10 documents it produced. Ferrero did not respond to the second set because discovery was stayed on
11 October 19.
12
3.
Plaintiffs also served two sets of Interrogatories on Ferrero, on March 23 and June 8.
13 Ferrero responded on April 8 and July 15.
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4.
Ferrero served Plaintiffs with Interrogatories on July 25, 2011, to which Plaintiffs
15 responded on August 29, and with Requests for Production on August 31, to which Plaintiffs responded
16 on October 3, including by producing nearly 500 pages of documents.
17
5.
Plaintiffs also propounded document subpoenas, and in some cases deposition
18 subpoenas, on nine third parties from whom they obtained documents, including Ferrero vendors,
19 distributors, advertising agencies and consultants. These third parties included: Connie Evers, Isabelle
20 Lambotte, Aspen Logistics, Believe Media, Merkley+Partners, Vision Creative Group, The Wilson
21 Group, Zenithmedia, and MS&L. As a result, Class Counsel reviewed thousands of documents.
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6.
Ferrero also served a third-party subpoena, on Costco, for records relating to Plaintiffs’
23 purchases.
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7.
Plaintiffs deposed three witnesses: Ferrero’s Chief Executive Officer, Bernard Kreilman
25 (on April 14, 2011); Nutella’s spokesperson, purported children’s nutrition expert Connie Evers (on
26 July 26, 2011); and Nutella’s former nutritional consultant before Evers, Isabelle Lambotte (on October
27 4, 2011). Although the Kreilmann deposition was ostensibly related to venue issues relevant to
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1
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 Ferrero’s Motion to Transfer Venue, it provided valuable merits discovery, such as Nutella’s sales, its
2 manufacturing and distributing process, and the identity of knowledgeable witnesses.
3
8.
Ferrero took Plaintiffs’s depositions on Athena Hohenberg and Laura Rude-Barbato on
4 September 29 (Ms. Hohenberg) and 30 (Ms. Rude-Barbato), 2011.
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6
Settlement Negotiations
9.
The parties first discussed settlement during a brief, informal telephone conversation in
7 March, 2011, and then again following Mr. Kreilmann’s deposition on April. Later, in the summer of
8 2011, the parties attempted to schedule a joint mediation with the Plaintiffs in the New Jersey copycat
9 case, Glover v. Ferrero USA, Inc., No. 11-1086-FLW (D.N.J.). The mediation, however, was derailed
10 by New Jersey counsel’s shenanigans in their attempt to wrest away control of the case from Plaintiffs
11 and their counsel.
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10.
Specifically, On July 13, Plaintiffs, Ferrero and Glover agreed they would mediate
13 together, in San Diego, on August 31, with the hopes that the resolution of Glover’s MDL motion
14 scheduled to be heard on July 28 would inform those discussions.
15
11.
On July 26, two days before the Judicial Panel on Multidistrict Litigation was to hear
16 Glover’s argument that the first-filed California cases should be centralized with her case in New
17 Jersey, a second plaintiff, Jamie Kaczmarek, filed an action in New Jersey, which was copied verbatim
18 from the Glover complaint (including identical typographical errors), except for the plaintiff-specific
19 allegations. Kaczmarek was represented by counsel who frequently work together with Glover’s
20 counsel. Nevertheless, despite his duty of candor, Glover’s counsel began the hearing by advising the
21 Panel that “since we filed our papers, . . . an action . . . has been recently filed in the District of New
22 Jersey” by “[d]ifferent plaintiffs’ lawyers.” See Excerpts of the Transcript of the July 28, 2011 Hearing
23 before the Judicial Panel on Multidistrict Litigation on Glover’s Motion for Centralization at p.3,
24 attached hereto as Exhibit 1.
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12.
Then, four days after the MDL hearing, apparently confident they would prevail with
26 Ferrero’s support and their piling on in New Jersey, Glover’s counsel unilaterally cancelled the
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 mediation despite their earlier agreement. 1 Because of New Jersey counsel’s gamesmanship
2 surrounding venue, and despite Plaintiffs’ attempts to be inclusive of Glover in settlement proceedings,
3 mediation and further settlement discussions stalled for the next couple months.
4
13.
After Plaintiffs filed their Class Certification Motion on August 1 (Dkt. No. 51) and the
5 Court denied Ferrero’s Motion to Dismiss on August 29 (Dkt. No. 69), the Court ordered an Early
6 Neutral Evaluation conference on October 19, 2011, before Honorable Magistrate Judge Cathy Ann
7 Bencivengo (Dkt. No. 70). Two weeks before the ENE, on October 4, 2012, Plaintiffs sent Ferrero a 68 page Memorandum of Understanding constituting an offer of settlement. The MOU suggested
9 injunctive relief comprised of advertising modifications, and a common fund to reimburse class
10 members. It did not discuss attorneys’ fees with any specificity, only generally noting that settlement
11 was not conditioned on Court approval of a fee request. On October 12, 2011, Ferrero said it would
12 discuss the offer further during the ENE the following week.
13
14.
During the ENE, which both Plaintiffs attended and participated in, discussions centered
14 on the substantive relief for the class, and attorneys’ fees were not discussed. However, with Plaintiff’s
15 class certification motion still pending, the parties were still far apart in how they valued the case and
16 whether (and how) Ferrero should modify its behavior. Following the ENE, the parties nevertheless
17 agreed to attend a private mediation together with the Glover plaintiffs.
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15.
On November 2, 2011, the parties attended a private mediation session before the
19 Honorable Nichoals J. Politan (Ret.) in West Palm Beach, Florida. Again, there was progress but no
20 resolution.
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Glover was represented by scores of attorneys at several law firms. Nevertheless, according to
her counsel, although the three attorneys who were primarily spearheading the New Jersey litigation
were available on the date and in the location agreed, another attorney, based in San Diego, had
obligations in San Francisco the day before and the day after the mediation, but not on August 31.
Glover therefore insisted that all the parties and the San Diego-based mediator travel to San Francisco
to accommodate that attorney, rather than proceeding with him available by phone or taking one of the
many available daily commuter flights between San Francisco and San Diego, or not mediate at all. By
the time that attorney finally agreed on August 10 that he could, in fact, be in San Diego to mediate on
August 31, the agreed-upon mediator, the Hon. Leo S. Papas (Ret.), was no longer available.
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
16.
During November, the parties continued to negotiate through periodic email and
2 telephone communications, finally agreeing on approximately November 14, 2011 on most of the
3 injunctive relief provisions embodied in the Settlement Agreement. A few disagreements over some
4 injunctive relief suggested by both parties remained, however, and there was no agreement on the
5 monetary terms of the settlement.
6
17.
On November 28, the parties attended a second Settlement Conference before Judge
7 Bencivengo. Again, Plaintiffs were present and active participants, at all times discussing Ferrero’s
8 proposals with counsel, counter-proposals, and assisting in the ultimate decision to accept the terms
9 embodied in the Settlement Agreement. After several hours of negotiation, and with Judge
10 Bencivengo’s ample assistance, the parties finally agreed on all the terms reflected in the Settlement
11 Agreement. The amount of the Injunctive Fee Award Ferrero agreed to pay Class Counsel was the last
12 provision discussed, and then only after the parties had agreed on all the injunctive relief and the class’s
13 common fund.
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Media Coverage of the Settlement
18.
The Settlement has received considerable media attention in recent weeks, including
16 being featured on Good Morning America (which interviewed Ms. Rude-Barbato), ABC News, CBS
17 News, npr.org, and many other popular outlets, including online and television.
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19.
A Google News search for “Nutella” on May 22, 2012, showed 6,310 stories about the
19 Settlement in the past month, and a standard Google search for “Nutella AND settlement” generated
20 more than 2.6 million hits.
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Notice to The Attorney General
20.
On January 25, 2012, Ferrero provided notice of the Settlement to the Attorney General
23 of the California.
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21.
The notice packet sent to the Attorney General included complete copies of the Master
25 Consolidated Complaint, Plaintiffs’ Memorandum of Points and Authorities in Support of Joint Ex
26 Parte Application for Preliminary Approval of Settlement, the supporting Declaration of Gregory S.
27 Weston and all exhibits attached thereto, including the Claim Form, Publication Notice, and Settlement
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4
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 Notice, a copy of the Order Granting Joint Motion for Preliminary Approval of Settlement, notice of
2 the Fairness Hearing set for July 9, 2012, and a definition of the Settlement Class.
3
22.
A true and correct copy of the cover letter sent to the California Attorney General is
4 attached hereto as Exhibit 2.
5
23.
To date, the California Attorney General has not requested further information or
6 indicated an intent to object.
7
8
The Strength of the Settlement
24.
I believe the Settlement affords the Class a substantial and important benefit, most
9 especially in terms of the injunctive relief whereby Ferrero has agreed to modify Nutella’s advertising
10 wholesale, including changing its label, discontinuing the existing television commercials and shooting
11 new commercials with scripts that Class Counsel has reviewed and provided input on, changes to the
12 Nutella website to remove content attributable to the former Nutella spokesperson, purported children’s
13 nutrition expert Connie Evers, and by agreeing to no longer employ Ms. Evers as Nutella’s
14 spokesperson.
15
25.
As laid out in Plaintiffs’ First Amended Consolidated Complaint, the dangers of
16 regularly consuming the amount of sugar and saturated fat in Nutella are well-documented. See FACC
17 ¶¶ 35-43. By prominently disclosing Nutella’s sugar and fat content on the front label (or “Principal
18 Display Panel”) using the Grocery Manufacturers Association front-of-pack nutrition labeling program,
19 consumers will be better informed and able to make choices to promote their health and the health of
20 their children and families. In addition, Ferrero’s agreement to stop using advertising suggestive that
21 Nutella is healthy (such as “balanced breakfast”) will prevent well-meaning health-conscious
22 consumers from inadvertently exposing themselves and their families to increased health risks.
23
26.
Even though this alone would be a great benefit for the Class and the public, the
24 Settlement is strong because it also includes a $550,000 fund by which Class Members can be refunded
25 for up to five Nutella purchases. Our calculations based on the sales information Ferrero provided in
26 this case show that this amounts to more than 3% of affected sales. False advertising actions such as
27 this one often settle in that range, but without the addition of the extensive advertising and marketing
28 changes Ferrero has agreed to.
5
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
27.
In sum, based on my experience and knowledge of the facts of this case, I believe this
2 Settlement provides the Class and public a strong benefit, primarily from the extensive injunctive relief,
3 but also because of the addition of a monetary component.
4
5
Class Counsel’s Qualifications
28.
The Weston Firm’s partners and principal timekeepers on the matter are myself and
6 Gregory Weston. I graduated from New York University, where I was Editor of the Law Review, after
7 which I worked for Baker & Hostetler LLP in New York, then Mayer Brown LLP in Palo Alto, before
8 joining the Weston Firm in 2010. My career has always focused on complex civil litigation, including
9 class actions on both the defense side and, now with the Weston Firm, entirely on the plaintiff side.
10
29.
Mr. Weston graduated from Harvard Law School and worked for the law firm now
11 known as Robbins, Geller, Rudman & Dowd until January 2008. Mr. Weston incorporated the Weston
12 Firm on December 31, 2007 and began operations January 7, 2008. During this entire time, all or nearly
13 all of his practice has been representing plaintiffs in consumer fraud and antitrust class actions.
14
30.
Courtland Creekmore is a 1994 graduate of the University of San Diego School of Law,
15 and has spent 12 of his 18 years of legal experience litigating class actions, exclusively representing
16 plaintiff consumers, securities investors and homeowners in state and federal courts. From 2004-2010,
17 Mr. Creekmore worked for the law firm now known as Robbins, Geller Rudman & Dowd prosecuting
18 federal securities and accounting fraud cases. From 2001-2004, he worked for Epsten, Grinnell &
19 Howell representing homeowners in construction defect litigation. Mr. Creekmore joined The Weston
20 Firm in 2011.
21
31.
Melanie Persinger is a 2010 graduate of University of Michigan Law School where she
22 was Editor of the Michigan Telecommunications and Technology Law Review. She joined the Weston
23 Firm out of law school and has dedicated her entire career to representing plaintiffs in class actions.
24 ///
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26 ///
27 ///
28 ///
6
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
2
Class Counsel’s Rates
32.
The Weston Firm’s requested rates are as follows:
3
Timekeeper
Position
Graduation Year
Hourly Rate
4
Gregory S. Weston
Partner
2004
$525
5
Jack Fitzgerald
Partner
2004
$525
Courtland Creekmore
Associate
1994
$500
Melanie Persinger
Associate
2010
$300
-
$195
6
7
Paralegals
8
9
33.
In June 2011, the Weston Firm was awarded fees based on a rate of $500 in Red v.
10 Unilever United States, No. 10-cv-387-JW (N.D. Cal.). See Unilever Dkt. No. 152 at ¶ 5 (showing $500
11 rate for attorneys Weston and Fitzgerald), Dkt. No. 163 (Order granting Final Approval). In addition,
12 this past April, the Honorable Margaret M. Morrow awarded the Weston Firm fees in connection with
13 settling a lawsuit against Smart Balance, Inc., based on hourly rates of $500 for Weston and Fitzgerald,
14 $275 for Ms. Persinger, and $150 for paralegals. Relevant excerpts of Judge Morrow’s Tentative
15 Order, 2 which has not yet been entered, are attached hereto as Exhibit 3. The firm’s current rates
16 reflect a modest increase since Judge Ware approved its partners’ rates of $500 last June.
17
34.
These rates are consistent with the prevailing rates for attorneys of similar experience,
18 skill and reputation. For example, several courts in this district have approved fee ranges into which
19 Class Counsel’s rates easily fall. For example, in Hartless v. Clorox Co., 273 F.R.D. 630, 644 (S.D.
20 Cal. 2011), the Honorable Cathy Ann Bencivengo—who was the Magistrate Judge who assisted in
21 reaching the Settlement Agreement in this case—affirmed rates of “$675 [sic] for an experienced
22 partner’s time to $100 per hour for a paralegal’s time.” Id. at 644. The specific rates approved were as
23 follows: 3
24
2
Because the Tentative Order was 64 pages and discussed a number of issues not relevant here
(such as class certification and motion to intervene filed in connection with the settlement), I attach only
26 the relevant portions.
25
3
27
See Hartless v. Clorox Co., No. 06-cv-2705-CAB (S.D. Cal.), Dkt. Nos. 82, 84-85, 87-88
(declarations in support of motion for attorneys fees).
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
Timekeeper
2
Position
Rate
Blood Hurst & O’Reardon LLP
3
Timothy G. Blood
Partner
$665
Leslie E. Hurst
Partner
$585
Thomas J. O’Reardon II
Partner
$510
-
$260
4
5
6
7
Paralegal
Robbins Geller Rudman & Dowd LLP
8
Timothy G. Blood
Partner
$655
10
Kevin K. Green
Partner
$615
11
Leslie E. Hurst
Partner
$585
12
Rachel Jensen
Partner
$565
13
Catherine J. Kowalewski
Partner
$555
Cory Miller
Associate
$410
Ivy Ngo
Associate
$380
Thomas O’Reardon
Associate
$345
Paula Roach
Of Counsel
$345
Pamela M. Parker
Of Counsel
$620
20
John J. Stoia
Of Counsel
$795
21
Lauren Ledzion
Project Attorney
$350
22
Vincent M. Serra
Project Attorney
$345
23
Paralegals
-
$240 - $295
9
14
15
16
17
18
19
24
25
26
27
Bonnett, Fairbourn, Friedman & Balint, P.C.
Andrew S. Friedman
Shareholder
$650
Elaine A. Ryan
Shareholder
$575
T. Brent Jordan
Associate
$500
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
Timekeeper
Position
Rate
Patricia N. Syverson
Associate
$400
Manfred C. Muecke
Associate
$375
Todd D. Carpenter
Associate
$375
Michael D. Sandulak
Associate
$350
7
Michael C. McKay
Associate
$250
8
Paralegals
-
$100 - $175
2
3
4
5
6
Bock Hatch, LLC
9
10
Richard J. Doherty
Not Provided
$450
11
Phillip A. Bock
Not Provided
$450
12
James M. Smith
Not Provided
$350
13
Lisa Vandercruyssen
Associate
$285
-
$100
14
Paralegal
15
LakinChapman, LLC
16
Paul Marks
Not Provided
$303
Marc W. Parker
Not Provided
$396
Crystal Duckett
Paralegal
$108
17
18
19
20
35.
In awarding these rates, Judge Bencivengo noted that “the rates charged by the attorneys
21 and paralegals in this action” were reasonable “based on the Court’s familiarity with the rates charged
22 by other firms in the San Diego area[.]” Id.
23
36.
In another recent Southern District of California case, the Honorable Herbert B.
24 Hoffman (Special Master) approved a fee award based on attorney rates of $695, $595, and $550 for
25
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27
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 partners; $395 and $245 for associates; and $125 to $150 for paralegals. See Cohorst v. BRE Props.,
2 2011 U.S. Dist. LEXIS 151719 (S.D. Cal. Nov. 9, 2011). 4
3
37.
Similarly, in Iorio v. Allianz Life Ins. Co. of N. Am., Inc., 2011 U.S. Dist. LEXIS 21824,
4 at *31-32 (S.D. Cal. Mar. 3, 2011), the Honorable Janis L. Sammartino approved the following rates:
5
Position 5
Rate
Robert S. Gianelli
Partner
$750
Raymond E. Mattison
Partner
$750
Don A. Ernst
Partner
$750
10
Ronald A. Marron
Partner
$595
11
Dean Goetz
Not Provided
$595
12
Sherril Neil Babcock
Not Provided
$575
13
Christopher D. Edgington
Associate
$575
14
Jully C. Pae
Associate
$500
Richard R. Fruto
Associate
$410
Joanne Victor
Not Provided
$450
Scott Juretic
Not Provided
$410
-
$195
Timekeeper
6
7
8
9
15
16
17
18
Paralegals
19
20
38.
Survey data further confirm the reasonableness of Class Counsel’s rates. A 2007 survey
21 by the National Law Journal shows rates for attorneys at Luce, Forward, Hamilton & Scripps’ San
22 Diego offices as between $325 and $725 for partners, with an average of $465 and median of $475, and
23 associates with rates between $220 and $450, with an average of $281 and a median of $280. These
24 rates, adjusted to 2012 dollars, are summarized as follows:
25
4
See Cohorst, No. 10-cv-2666-JM-BGS (S.D. Cal.), Dkt. Nos. 57-4, 57-8, and 57-9 (declarations
26 in support of fee application showing hourly rates).
5
27
See Iorio, No. 5-cv-633-JLS-CAB (S.D. Cal.), Dkt. No. 469 at 16-19 (fee motion describing
timekeepers’ experience).
28
10
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
Position
2007
Range
2012
Range
2007
Average
2012
Average
2007
Median
2012
Median
3
Partner
$325-$725
$360-$804
$465
$516
$475
$527
4
Associate
$220-$450
$244-$499
$281
$311
$280
$310
2
5
39.
Thus, the firm’s requested partner rate of $525, and requested associate rate of $295, fall
6 within, and below the average/median range of the typical rates of a San Diego law firm that practices
7 complex litigation. See generally Catala v. Resurgent Capital Servs., L.P., 2010 U.S. Dist. LEXIS
8 63501, at *19 n.3 (S.D. Cal. June 22, 2010) (relying on same to award fees).
9
40.
A 2010 survey by the National Law Journal shows rates of firms in Los Angeles from
10 $350-$670 for partners and $245-445 for associates. According to the same survey (including the 2009
11 version), 6 although the rates of defense counsel in this case are not provided, the chart below shows the
12 rates charged by the firms currently defending other food companies in cases brought by clients of
13 Class Counsel involving misleading health claims. 7
14
Firm
15
16
Greenberg Traurig
17
(New York Office)
18
Winston & Strawn
(Chicago Office)
19
Jenner & Block
20
(Chicago Office)
21
22
41.
Median Partner Billing Rate
Median Associate Billing
Rate
$580 (2010)
$350 (2010)
$660 (2010)
$375 (2010)
$625 (2009)
$400 (2009)
The Weston Firm’s blended rate of $431.62 in this case ($511,255 divided by 1,184.5
23 hours) also falls below that recently approved by another Southern District court. Stuart v. RadioShack
24
6
Copies of the NLJ surveys are in Class Counsel’s possession but are not being filed due to their
volume.
25
7
See Yumul v. Smart Balance, Inc., No. 10-cv-927 (C.D. Cal.) (Smart Balance represented by
26 Greenberg Traurig); Henderson v. The J.M. Smucker Company, No. 10-cv-4524 (C.D. Cal.) (Smucker
27 represented by Winston & Strawn); Red v. Kraft Foods, Inc. et al., Lead Case No. 10-cv-1028 (C.D.
Cal.) (Kraft represented by Jenner & Block).
28
11
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 Corp., 2010 U.S. Dist. LEXIS 92067, at *16-18 (S.D. Cal. Aug. 9, 2010) (finding blended rate of $708
2 reasonable, “particularly when no multiplier is being sought on top of the lodestar”).
3
4
Class Counsel’s Time Billed
42.
Our firm’s practice is to keep contemporaneous records for each timekeeper and to
5 regularly record time records in the normal course of business, and we kept time records in this case
6 consistent with that practice. Moreover, our firm’s practice is to bill in 6-minute (tenth-of-hour)
7 increments. The firm’s billing records are available to submit to the Court for in camera review upon
8 request.
9
43.
The total lodestar for the Weston Firm in this matter is $509,882.50, reflecting 910
10 attorney hours, and 274.5 paralegal hours (split among 5 paralegals who billed between 6.2 and 130.7
11 hours on the case). 8 The Weston Firm’s lodestar is summarized in Appendix 1 to Plaintiffs’ fee motion.
12 Prior to finalizing the firm’s lodestar, we carefully reviewed our hours and made cuts for time entry
13 errors, duplications, and instances where we determined the hours should be reduced or not billed.
14
44.
Although the hours billed may be seemingly high given the length of the litigation, that
15 is because of its intensity, as the Docket evidences, including four complaints (Hohenberg, Rude16 Barbato, Master Consolidated Complaint, First Amended Consolidated Complaint); many substantive
17 and procedural motions and an MDL motion; three settlement conferences or mediations; and
18 substantial written discovery and depositions, including from nine third parties, all in less than a year.
19 The time also reflects Class Counsel’s work on behalf of Plaintiffs in attempting to intervene in the
20 New Jersey action in order to protect the interests of the then-putative class from both inconsistent
21 decisions and judgments which might have an effect in this case, and from a reverse auction scenario
22 by counsel more interested in settling the case away than litigating it for the Class’s benefit.
23
45.
Moreover, the hours billed of 127.4 per month are within the range approved as
24 reasonable by other courts in similar false advertising actions. See Brazil v. Dell Inc., 2012 U.S. Dist.
25 LEXIS 47986 (N.D. Cal. Apr. 4, 2012) (in false advertising action, approving fee based on 15,855.5
26
8
27
As noted in Class Counsel’s fee application, App. 1 n.1, Class Counsel’s total lodestar includes
post-application time at a blended rate. That time, however, is not specifically addressed here.
28
12
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 hours spent over 55 months, or 288 hours/month); Friedman v. 24 Hour Fitness USA, Inc., 2010 U.S.
2 Dist. LEXIS 143816 (C.D. Cal. July 12, 2010) (in action alleging false advertising under UCL and
3 CLRA, and RICO violation, finding reasonable 22,578.01 hours over 45 months, or 501.7
4 hours/month); Wilson v. Airborne, Inc., 2008 U.S. Dist. LEXIS 110411 (C.D. Cal. Aug. 13, 2008) (in
5 false advertising action, finding reasonable 3,706.6 hours over 24 months, or 154.4 hours/month);
6 Browning v. Yahoo! Inc., 2007 U.S. Dist. LEXIS 86266 (N.D. Cal. Nov. 16, 2007) (finding reasonable
7 4,798.7 hours over 38 months, or 126.3 hours/month); Yoo v. Wendy’s Int’l, Inc., No. 07-4515 (C.D.
8 Cal. Mar. 9, 2009), Dkt. No. 89 (in action alleging false advertising of food, approving fee based on
9 1,630 hours spent over 17 months, or 95.9 hours/month).
10
46.
The strongest evidence of the reasonability of Class Counsel’s hours worked, however,
11 comes from comparing the hours to those spent in the New Jersey Glover action. Although the actions
12 consolidated there were filed more than three weeks (Glover, filed February 27, 2011) and almost 6
13 months (Kaczmarek, filed July 26, 2011) later than these actions (February 1 and 4, 2011, respectively),
14 and involved virtually no motion practice, did not have a certified class, relied on the discovery sought
15 and obtained by Plaintiffs in this case, and merely settled on the heels of this action, on identical terms
16 (other than Ferrero’s agreement to pay New Jersey counsel millions more in fees), New Jersey counsel
17 claim 3,000 hours (see Glover Dkt. No. 69-1 at 3, 12), for a total lodestar of $1.8 million (and then
18 request a 2.09 multiplier on top of that for a total fee of $3,750,000, of which $750,000 is to come from
19 that class’s $2,500,000 restitution fund). Class Counsel’s hours here are conservative by comparison.
20
21
The Risk of Non-Payment
47.
The Federal Judicial Center published a report in 1996 titled, “Empirical Study of Class
22 Actions in Four Federal District Courts: Final Report to the Advisory Committee on Civil Rules (“FJC
23 Report”). The study was requested by the Judicial Conference Advisory Committee on Civil Rules
24 when it was considering proposals to amend Rule 23 of the Federal Rules of Civil Procedure. The study
25 is based on 407 class actions lawsuits that either settled or went to verdict in the two-year period from
26 July 1, 1992 to June 30, 1994 in the following four federal judicial districts: the Eastern District of
27 Pennsylvania (Philadelphia); the Southern District of Florida (Miami); the Northern District of Illinois
28 (Chicago); and the Northern District of California (San Francisco). FJC Report at 3-4, 7-8.
13
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
48.
For the 407 class actions, the FJC Report reports the following regarding class
2 certification:
3
•
In 59 cases (14.5%), the class claims were certified for settlement purposes only. Id. at 35.
4
•
In 93 cases (22.85%), the class claims were certified unconditionally. Id.
5
•
Therefore, a total of 152 cases (37.35%) had certified classes, and the other 255 (62.65%)
6
did not. Id.
7
•
In at least 23 of the certified classes, the outcome was unfavorable to Plaintiffs. This is
8
based on Table 39 of the FJC Report (at p. 179), which lists the following outcomes adverse
9
to plaintiffs in certified class cases (excluding classes certified for settlement purposes
10
only): nine dismissals by motion, one stipulated dismissal, one non-class settlement, and
11
twelve summary judgments. Id. at 179, App. C, Table 39.
12
49.
Thus, in sum, the successful class claims from the total 407 filed class actions totaled
13 129 or less (152 minus 23). Using the number 129/407 to get a percentage, 31.7% or less of the filed
14 cases resulted in successful class outcomes for plaintiffs. This does not account for degree of success
15 (i.e., some cases could have resulted in minimal or partial success and would still be in the successful
16 claim category).
17
Class Counsel’s Expenses
18
50.
A summary of Class Counsel’s expenses in the amount of $9,437.71 is provided in
19 Appendix 2 to Plaintiffs’ fee application. This includes $6,266.19 in recoverable costs, consisting of
20 costs for court fees, deposition costs for transcribing, recording and travel, and service of process fees;
21 and $3,171.52 in costs reasonably necessary to conduct the litigation including, for example, travel
22 costs associated with court hearings, transportation and parking costs, costs for local New Jersey
23 counsel (as required by that court’s local rules), and deposition supplies.
24
51.
Class Counsel incurred additional costs for which it does not seek reimbursement,
25 including photocopying (internal and external), postage and overnight delivery, meals, including while
26 traveling, legal research and PACER charges. I estimate these uncharged costs to our firm to be over
27 $3,000.
28
14
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1
2
Notice and Administration Costs
52.
The parties in this action and the 49-state action coordinated in providing class notice,
3 and are using the same administrator to process class claims (although the claims themselves are being
4 handled separately, with each case’s respective restitution fund being held in a separate account, etc.).
5 The parties agreed that each case should share the costs in proportion to the sales, meaning the
6 California fund is responsible for 12.4% of the costs. According to the claims administrator, as of May
7 23, 2012, based on the current claims filed, the current overall estimate for notice and administration
8 costs relating to both the California and 49-State Settlement is $566,564. The California fund’s 12.4%
9 share is approximately $70,250 (12.7% of the fund), while the 49-State Fund’s share is approximately
10 $501,975 (20% of its fund).
11
12
I declare under penalty of perjury that the foregoing is true and correct to the best of my
13 knowledge. Executed on May 25, 2012 in Santa Clara, California.
14
/s/ Jack Fitzgerald
Jack Fitzgerald
15
16
17
18
19
20
21
22
23
24
25
26
27
28
15
In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
1 DATED: May 25, 2012
Respectfully Submitted,
2
/s/ Jack Fitzgerald
Jack Fitzgerald
3
THE WESTON FIRM
GREGORY S. WESTON
JACK FITZGERALD
MELANIE PERSINGER
COURTLAND CREEKMORE
1405 Morena Blvd., Suite 201
San Diego, CA 92109
Telephone: (619) 798-2006
Facsimile: (480) 247-4553
4
5
6
7
8
9
14
LAW OFFICES OF RONALD
A. MARRON, APLC
RONALD A. MARRON
MAGGIE REALIN
B. SKYE RESENDES
3636 4th Street, Suite 202
San Diego, CA 92103
Telephone: (619) 696-9006
Facsimile: (619) 564-6665
15
Class Counsel
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In re Ferrero Litigation, Case No. 3:11-CV-00205-H-KSC
DECLARATION OF JACK FITZGERALD IN SUPPORT OF FINAL APPROVAL AND FEE APPLICATION
EXHIBIT 1
Case NJ/3:11-cv-01086 Document 22 Filed 09/06/11 Page 1 of 17
1
UNITED STATES JUDICIAL PANEL
2
ON
3
MULTIDISTRICT LITIGATION
4
SAN FRANCISCO, CALIFORNIA; CEREMONIAL COURTROOM, NINETEENTH
5
FLOOR; JUDGE DAMRELL, JUDGE VRATIL, JUDGE HEYBURN, JUDGE
6
1
FURGESON, JUDGE JONES
7
IN RE:
8
AND SALES PRACTICES LITIGATION) THURSDAY, JULY 28, 2011
9
______________________________) ORAL ARGUMENT
10
NUTELLA MARKETING
) MDL NO. 2248
REPORTER'S TRANSCRIPT OF PROCEEDINGS
11
APPEARANCES:
12
FOR THE PLAINTIFF MARNIE GLOVER:
13
15
SCOTT & SCOTT
BY: JOSEPH P. GUGLIELMO, ATTORNEY AT LAW (SPEAKER ONE)
500 FIFTH AVENUE, SUITE 40
FOUR MINUTES
NEW YORK, NEW YORK 10110-4099
ONE MINUTE REBUTTAL
TEL (212) 302-0201
16
FOR THE PLAINTIFF ATHENA HOHENBERG AND LAURA RUDE-BARBATO:
17
THE WESTON FIRM
BY: GREGORY S. WESTON, ATTORNEY AT LAW
888 TURQUOISE STREET
SAN DIEGO, CALIFORNIA 92109
TEL (858) 488-1672 FAX (480) 247-4553
GREG@WESTONFIRM.COM
14
18
19
(SPEAKER TWO)
FIVE MINUTES
20
FOR FERRERO U.S.A., INC:
21
22
23
WILSON SONSINI GOODRICH & ROSATI
BY: KEITH E. EGGLETON, ATTORNEY AT LAW (SPEAKER THREE)
650 PAGE MILL ROAD
PALO ALTO, CALIFORNIA 94304-1050
TEL (650) 493-9300 FAX (650) 493-6811
24
25
REPORTED BY:
STARR A. WILSON, CSR 2462
Case NJ/3:11-cv-01086 Document 22 Filed 09/06/11 Page 3 of 17
3
1
SAN FRANCISCO, CALIFORNIA; THURSDAY, JULY 28, 2011; 10:25
2
A.M., CEREMONIAL COURTROOM, NINETEENTH FLOOR, JUDGE DAMRELL,
3
JUDGE VRATIL, JUDGE HEYBURN, JUDGE FURGESON, JUDGE JONES
4
-oOo-
5
6
Next is MDL 2248.
JUDGE HEYBURN:
Nutella
Marketing and Sales.
7
Mr. Guglielmo.
8
MR. GUGLIELMO:
9
Good morning.
Thank you.
My name is Joseph Guglielmo from
10
Scott & Scott.
11
is the movant in this action seeking consolidation and
12
centralization to the District of New Jersey before the
13
Honorable Freda Wolfson.
14
I represent the Plaintiff Marnie Glover, who
Your Honor, to update the panel briefly, there are
15
now five federal cases pending.
16
filed our papers, have notified the panel of an action that
17
has been recently filed in the District of New Jersey as
18
well as an additional action in the Northern District of
19
California.
20
21
JUDGE FURGESON:
These are all with different
plaintiffs' lawyers?
22
23
Um, Defendants, since we
MR. GUGLIELMO:
yes.
Different plaintiffs' lawyers,
All of these cases are asserting nationwide classes.
24
As we set forth in our papers, and as the
25
Defendants have set forth in their papers, both the
EXHIBIT 2
EXHIBIT 3
,-,*
1
2
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6
7
8
UNITED STATES DISTRICT COURT
9
CENTRAL DISTRICT OF CALIFORNIA
10
11
Case No. CV 10-00927 MMM (AJWx)
12
13
14
15
16
In Re NUCOA REAL MARGARINE
ORDER CERTIFYING SETTLEMENT
LITIGATION
CLASS, APPROVING FINAL
SETTLEMENT, DENYING MOTION TO
INTERVENE, AND AWARDING
ATTORNEYS' FEES, INCENTIVE
AWARD, AND COSTS
17
18
19
Rebecca Yumul commenced this action of February 8, 2010 on behalf of herself, and all
20
others similarly situated, against Smart Balance, Inc.1 In the currently operative complaint,
21
Yumul pleads claims for violation of California's unfair competition law ("UCL"), California
22
Business & Professions Code § 17200 et seq.; violation of California's false advertising law
23
("FAL"), California Business & Professions Code § 17500 et seq.; and violation of California's
24
Consumer Legal Remedies Act ("CLRA"), California Civil Code § 1750 et seq.2 Yumul alleges
25
26
'Complaint for Violations of Unfair Competition Law, False Advertising Law, and
27
Consumer Legal Remedies Act ("Complaint"), Docket No. 1 (Feb. 8, 2010).
28
2Fourth Amended Complaint ("FAC"), Docket No. 95 (Jun. 3, 2011).
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