Peace Officers' Annuity and Benefit Fund of Georgia v. DaVita Inc. et al
ORDER granting 108 Lead Plaintiffs' Motion for an Award of Attorneys' Fees and Reimbursement of Litigation Expenses by Judge William J. Martinez on 07/15/2021.(trvo, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 17-cv-0304-WJM-NRN
PEACE OFFICERS’ ANNUITY AND BENEFIT FUND OF GEORGIA, individually and
on behalf of all others similarly situated; and
JACKSONVILLE POLICE AND FIRE PENSION FUND, individually and on behalf
of all others similarly situated,
KENT J. THIRY;
JAMES K. HILGER; and
JAVIER J. RODRIGUEZ,
ORDER GRANTING LEAD PLAINTIFFS’ MOTION FOR AN AWARD OF
ATTORNEYS’ FEES AND REIMBURSEMENT OF LITIGATION EXPENSES
This matter is before the Court on Lead Plaintiffs’ Peace Officers’ Annuity and
Benefit Fund of Georgia and the Jacksonville Police and Fire Pension Fund (jointly,
“Lead Plaintiffs”) Motion for an Award of Attorneys’ Fees and Reimbursement of
Litigation Expenses, filed on February 23, 2021 (“Motion”). (ECF No. 108.) The Motion
is unopposed. This Court has subject matter jurisdiction pursuant to the Securities
Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. § 78aa et seq., and 28 U.S.C. §
The background of this case has been set forth at length in prior orders and
therefore the Court presumes familiarity with the facts of this case. (See, e.g., ECF No.
118.) On April 13, 2021, the Court entered the Order Granting Lead Plaintiffs’ Motion
for Final Approval of Class Action Settlement and Plan of Allocation. (Id.) In the instant
Motion, Lead Plaintiffs request that the Court enter an order directing: (i) an award of
attorneys’ fees in the amount of 30% of the Settlement Fund; (ii) reimbursement of
$547,409.27 in litigation expenses; and (iii) Representative Reimbursements of $10,000
to Lead Plaintiffs for their efforts in representing the Settlement Class, as authorized by
the Private Securities Litigation Reform Act of 1995 (“PSLRA”). 1 No class members
have objected to Lead Plaintiffs’ requests.
II. FEE AWARD
Under the PSLRA, the “[t]otal attorneys’ fees and expenses awarded by the court
to counsel for the plaintiff class shall not exceed a reasonable percentage of the amount
of any damages and prejudgment interest actually paid to the class.” 15 U.S.C. § 78u–
4(a)(6). In common fund cases, the Tenth Circuit has “recognized the propriety of
awarding attorneys’ fees . . . on a percentage of the fund, rather than lodestar, basis.” 2
Uselton v. Commercial Lovelace Motor Freight, Inc., 9 F.3d 849, 853 (10th Cir. 1993);
accord Gottlieb v. Barry, 43 F.3d 474, 483 (10th Cir. 1994) (holding that, although either
method is permissible in common fund cases, “Uselton implies a preference for the
percentage of the fund method”). Because this is a common fund case and because
Lead Plaintiffs’ fee request is for a percentage of the common fund, the Court will
The Court has already granted Lead Plaintiffs’ request for reimbursement awards (ECF
No. 118 at 14–15) and need not discuss this request further.
The lodestar amount is calculated based upon “the total number of hours reasonably
expended multiplied by a reasonable hourly rate—and then adjust[ing] the lodestar upward or
downward to account for the particularities of the suit and its outcome.” Zinna v. Congrove, 680
F.3d 1236, 1239, 1242 (10th Cir. 2012) (quotation marks omitted).
calculate the attorneys’ fees award using the percentage of the fund approach. See
Brown v. Phillips Petroleum Co., 838 F.2d 451, 454 (10th Cir. 1988) (distinguishing
common fund and statutory fees cases).
The “percentage reflected in a common fund award must be reasonable [and] the
district court must ‘articulate specific reasons for fee awards.’” Id. at 454 (quoting
Ramos v. Lamm, 713 F.2d 546, 552 (10th Cir. 1983)). In determining the
reasonableness of a percentage award, courts must apply the Johnson factors, which
(1) the time and labor involved; (2) the novelty and difficulty
of the questions; (3) the skill requisite to perform the legal
service properly; (4) the preclusion of other employment by
the attorney due to acceptance of the case; (5) the
customary fee; (6) any prearranged fee . . .; (7) time
limitations imposed by the client or the circumstances; (8)
the amount involved and the results obtained; (9) the
experience, reputation, and ability of the attorneys; (10) the
undesirability of the case; (11) the nature and length of the
professional relationship with the client; and (12) awards in
Id. at 454–55 (citing Johnson v. Ga. Highway Express, Inc., 488 F.2d 714, 717 (5th Cir.
1974)); see also Gottlieb, 43 F.3d at 483. “[R]arely are all of the Johnson factors
applicable; this is particularly so in a common fund situation.” Brown, 838 F.2d at 455–
56 (“The court here clearly considered all of the relevant Johnson factors and applied
them appropriately.”). Thus, in evaluating the reasonableness of a fee award, a court
need not specifically address each Johnson factor. Gudenkauf v. Stauffer Commc’ns,
Inc., 158 F.3d 1074, 1083 (10th Cir. 1998).
Time and Labor Involved
Lead Plaintiffs submit that prosecuting this case required Lead Counsel to
expend more than 31,000 hours, equivalent to $14.7 million in attorney and staff time,
over the course of more than four years of vigorous litigation. (ECF No. 108 at 11.)
These efforts included an extensive and extremely comprehensive investigation,
which included locating numerous internal documents and confidential witnesses that
proved critical in drafting a highly-detailed Complaint sufficient to defeat Defendants’
motion to dismiss. (Id. at 10.) Furthermore, Lead Counsel engaged in comprehensive
discovery, including consulting with various economic and industry experts; reviewing
845,000 pages of documents produced by Defendants and over twenty third-parties;
collecting and producing over 25,000 pages in response to Defendants’ document
requests; extensive class certification-related briefing and discovery, including
defending Lead Plaintiffs’ depositions and the deposition of Lead Plaintiffs’ expert on
market efficiency, and deposing Defendants’ rebuttal expert; and opposing Defendants’
motion for partial reconsideration. (Id.) In addition, the extensive settlement
negotiations were time-consuming, including submitting detailed mediation statements
and presentations over the course of six formal mediations that culminated in the
Settlement. (Id. at 10–11.) In the Motion, Lead Plaintiffs note that Lead Counsel will
continue to expend additional time and out-of-pocket expenses in connection with the
settlement administration process and assist with implementation of the Settlement,
which was approved following the Fairness Hearing. (Id. at 11 n.4.)
Based on the foregoing efforts expended by Lead Counsel, the Court concludes
that the time and labor expended was appropriate given the nature of the case and finds
that this factor supports the requested award.
The Amount Involved and Results Obtained
Courts in this District have repeatedly found that when determining the amount of
fees to be awarded, the “greatest weight should be given to the monetary results
achieved for the benefits of the class.” Anderson v. Merit Energy Co., 2009 WL
3378526, at *4 (D. Colo. Oct. 20, 2009); see also Shaw v. Interthinx, Inc., 2015 WL
1867861, at *7 (D. Colo. Apr. 22, 2015) (“The degree of success . . . is a critical factor in
determining the amount of fees to be awarded.”).
As Lead Plaintiffs point out, the monetary result here is “exceptional.” (ECF No.
108 at 13.) The $135 million recovery represents the second-largest all-cash securities
class action recovery ever obtained in this District, is among the top five such
settlements in Tenth Circuit history, and is more than twenty times larger than the $6.7
million median for securities class action settlements in the Tenth Circuit from 2010 to
2019. (Id.) Here, the likely maximum damages at trial ranged from $312 million to $432
million, and therefore the Settlement recovers between 31% and 43% of the Class’s
damages—eight to eleven times greater than the median 3.9% recovery in similar
actions, a significant achievement which, in the Court’s view, further supports granting
the fee request. See In re Crocs, Inc. Sec. Litig., 306 F.R.D. 672, 691 n.20 (D. Colo.
2014) (approving settlement representing “approximately 1.3% of the amount of
damages that could be achieved”). Given the extraordinary nature of the recovery for
class members, the Court finds that this factor also favors granting the fee request.
Customary Fee and Awards in Similar Cases
Courts in the Tenth Circuit have noted that “the typical fee award in complex
cases is around one third of the common fund.” In re Crocs, 2014 WL 4670886, at *3;
see also Diaz, 2019 WL 2189485, at *5 (“33% fee award falls within the norm”);
Nakkhumpun v. Taylor, 2016 WL 11724397, at *5 (D. Colo. June 13, 2016) (same).
Moreover, courts in the Tenth Circuit have repeatedly found that a 30% fee award is
reasonable even in the context of so-called “megafund” settlements, because applying
an arbitrary sliding fee percentage scale in large settlements “fails to provide the proper
incentive for counsel and is fundamentally at odds with the percentage-of-the-fund
approach favored by the Tenth Circuit.” In re Syngenta AG MIR 162 Corn Litig., 357 F.
Supp. 3d 1094, 1114 (D. Kan. 2018) (awarding 33.3% fee of $1.51 billion settlement).
In the Motion, Lead Plaintiffs provide a detailed chart demonstrating that numerous
courts in the Tenth Circuit and nationwide have awarded 30% fees or higher in large
complex class actions. (ECF No. 108 at 15.)
In addition, the Court notes that a lodestar cross-check, while not required in the
Tenth Circuit, supports the fee request. Here, Lead Counsel’s total lodestar is
$14,717,351.25, and the requested 30% fee thus equates to a multiplier of 2.75, which
is at the low end of the typical range of multipliers routinely approved by courts in this
District and the Tenth Circuit. See, e.g., In re DaVita Healthcare Partners, Inc. Deriv.
Litig., 2015 WL 3582265, at *5 (D. Colo. June 5, 2015) (multiplier of 3 “in line with the
multipliers awarded in similar cases”); In re Crocs, 2014 WL 4670886, at *4 (referencing
District cases approving multipliers ranging from 2.5 to 4.6).
Moreover, Lead Counsel’s hourly rates—ranging from $365 to $895 for
attorneys, and $250 to $275 for support staff—are lower than hourly rates previously
approved by this Court and others within the District. See Ramos v. Banner Health,
2020 WL 6585849 (D. Colo. Nov. 10, 2020) and ECF No. 504 (approving rates ranging
from $490 to $1,060 per hour); In re Molycorp Inc. Sec. Litig., 2017 WL 11598681, at
*1–2 (D. Colo. June 16, 2017) (approving 30% fee request in securities class action
where attorney hourly rates ranged from $435 to $955 per hour); In re Crocs, 2014 WL
4670886, at *4, ECF No. 208 at 95 (awarding 30% fee where attorney hourly rates were
up to $935 per hour and were “higher than the rates charged by attorneys of similar skill
and experience in the Denver legal market”). The Court concludes this factor also
supports the fee request.
The Contingent Nature of the Fee, Undesirability of the Action, and
Preclusion of Other Employment
“Federal securities class actions require plaintiffs’ counsel to expend substantial
time and effort with no guarantee of success.” In re Crocs, 2014 WL 4670886, at *5.
As a result, “[s]uch cases are often seen as undesirable.” In re Spectranetics Corp.
Sec. Litig., 2011 WL 13238696, at *2 (D. Colo. Apr. 4, 2011).
As Lead Plaintiffs point out, the vast majority of securities class actions draw
multiple applications for appointment as lead plaintiff and lead counsel—that is the very
purpose of the PSLRA provision requiring notice to be disseminated advising
shareholders of the lead plaintiff deadline. (ECF No. 108 at 17.) Here, however, no law
firm other than Saxena White submitted a leadership application—a fact that
underscores the perceived “undesirability” and difficulty of the case. (Id.) Courts have
“recognize[d] that counsel should be rewarded for taking on a case from which other law
firms shrunk . . . the proper incentive here is a 30% fee.” In re Checking Account
Overdraft Litig., 830 F. Supp. 2d 1330, 1364 (S.D. Fla. 2011); see also Thorpe v. Walter
Inv. Mgmt. Corp., 2016 WL 10518902, at *10–11 (S.D. Fla. Oct. 17, 2016)
(undesirability shown where “Counsel was the only counsel willing to take on this
Importantly, the risk that Lead Counsel “would recover no compensation for their
extensive efforts was not merely hypothetical, especially where, as here, Plaintiffs were
subject to the PSLRA’s heightened pleading standard and faced the immediate
possibility of an adverse decision.” In re Crocs, 2014 WL 4670886, at *5. To date,
Lead Counsel has received no compensation for its prosecution of this case, and since
the extensive commitment of time and resources devoted here necessarily entailed the
preclusion of other projects, the primary focus of this factor is to acknowledge this
incongruence by permitting a higher recovery to compensate for the risk of recovering
nothing. As courts in this District have held, “[a] contingent fee arrangement often
weighs in favor of a greater fee because [s]uch a large investment of money [and time]
place[s] incredible burdens upon law practices.” In re Crocs, 2014 WL 4670886, at *4.
The significant burdens inherent in a contingent fee arrangement in a case of this
magnitude “weighs heavily in support of a substantial fee award.” Syngenta, 357 F.
Supp. 3d at 1113. The Court concludes that this factor also weighs in favor of the
The Court also notes that none of the class members objected to the requested
attorneys’ fees, which weighs in favor of the requested award. See Anderson v. Merit
Energy Co., 2009 WL 3378526, at *4 (D. Colo. Oct. 20, 2009) (“The absence of any
Class members’ objection is an additional factor that supports this Court’s approval of
the requested attorneys’ fees.”).
The Court finds that in combination the applicable Johnson factors compel its
conclusion that 30% of the $135 million common fund, or $40,500,000, reflects a
reasonable attorney fee award in this case. See 15 U.S.C. § 78u–4(a)(6). As a
consequence, the Court will grant in full Lead Plaintiffs’ request for attorneys’ fees.
The PSLRA also contemplates compensating class counsel for expenses
incurred in prosecuting a class action. 15 U.S.C. § 78u–4(a)(6). “[A]n attorney who has
created a common fund for the benefit of the class is entitled to reimbursement of . . .
reasonable litigation expenses from that fund.” In re Gen. Instrument Sec. Litig., 209
F.Supp.2d 423, 434 (E.D. Pa. 2001) (quotation marks omitted, emphasis in original).
Expenses “‘that are normally itemized and billed in addition to the hourly rate should be
included in fee allowances . . . if reasonable in amount.’” Bee v. Greaves, 910 F.2d
686, 690 (10th Cir. 1990) (quoting Ramos, 713 F.2d at 559).
Lead Counsel seek reimbursement of $547,409.27 in litigation expenses
reasonably incurred in litigating the Action, which expenses are routinely awarded in
similar actions, including expert fees, mediation expenses, discovery-related costs, and
investigation expenses. (ECF No. 108 at 20.) See In re Oppenheimer Rochester
Funds Grp. Sec. Litig., 2014 WL 12768451, at *3 ($3.5 million of expenses found
reasonable in securities class action). The White Declaration contains a full breakdown
of the litigation expenses. (See ECF No. 107-1, White Decl. Exs. E, F at ¶ 8, and G at ¶
9.) Notably, the requested expenses are significantly less than the $750,000 amount
set forth in the Notice, and no objections have been lodged thereto—further supporting
the reasonableness of the expense reimbursement request. (ECF No. 108 at 20 (citing
ECF No. 107-1 at ¶¶ 134–35).)
Upon due consideration, the Court is satisfied that the expenses are reasonable,
given the issues presented and duration of this case, and are of the type normally billed
to clients. The Court will therefore award Lead Counsel $547,409.27 in litigation
expenses reasonably incurred in the prosecution of this case.
Lead Plaintiffs’ Motion for Final Approval of Class Action Settlement and Plan of
Allocation (ECF No. 108) is GRANTED;
The Court awards to Plaintiffs attorneys’ fees in the amount of 30% of the
Settlement Fund, or $40,500,000, and the reimbursement of $547,409.27 in litigation
Should there be an unreasonable delay in the payment of these sums to Lead
Plaintiffs, they are granted leave to seek an order from this Court setting a deadline for
Dated this 15th day of July, 2021.
BY THE COURT:
William J. Martinez
United States District Judge
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