KEEPS EAGLE, et al v. VENEMAN, et al

Filing 918

MEMORANDUM AND OPINION. Signed by Judge Emmet G. Sullivan on 9/21/2018. (lcegs1)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
________________________________
)
MARILYN KEEPSEAGLE, et al.,
)
)
Plaintiffs,
)
)
v.
) Civil Action No. 99-3119 (EGS)
)
SONNY PERDUE, Secretary, U.S.
)
Department of Agriculture,
)
)
Defendant.
)
________________________________)
MEMORANDUM OPINION
On April 28, 2011, the Court granted, among other things,
plaintiffs’ motion for award of attorneys’ fees and costs,
awarding class counsel at the high end of the range set forth in
the 2011 Settlement Agreement between the parties: 8% of the
$760 million compensation fund amount, or $60.8 million,
pursuant to the following provision:
Plaintiffs will ask the Court to approve an
award of attorneys’ fees and costs to Class
Counsel, payable as part of the common fund
awarded to the Class, with the understanding
that the Plaintiffs may seek, and the Court
may award, such attorneys’ fees and costs the
total amount of which shall be at least 4% and
not more than 8% of $760,000,000.
Settlement Agreement, ECF No. 576-1 at XV.B; Order, ECF No. 606
at 3. Because a compensation fund had been established, the
Court made this award pursuant to the common fund doctrine. See
Swedish Hosp. Corp. v. Shalala, 1 F.3d 1261, 1262 (D.C. Cir.

1993)(holding that the “proper measure of [contingent counsel
fees in class actions resulting in the creation of a common fund
payable to plaintiffs] is a percentage of the [common] fund”).
Class counsel provided a lodestar calculation of actual and
projected fees 1 and costs of $26,533,940.48 for cross-check
purposes. Mem. of Law in Support of Pls.’ Mot. for an Award of
Attorneys’ Fees and Expenses, ECF No. 581-1 at 9. 2 The fees
awarded by the Court therefore exceeded actual and projected
fees and costs by a multiplier of 2.3, which fell “well within
the typical range of [comparable] awards.” Id. at 43-45.
Class counsel now seek a supplemental award from interest
accrued from the compensation fund based on a lodestar
calculation and pursuant to the following provision of the 2015
Addendum to the Settlement Agreement (“Addendum”):
In the event counsel seek an award of
attorneys’ fees and costs for work involved in
establishing the Trust and Modifying the
Agreement, such award may be made from
interest that has accrued from the total
Compensation Fund, and may only be with
approval by the Court upon a properly noticed
motion. The Secretary reserves the right to
address the entitlement to fees, the amount of
fees, or both entitlement and amount, in any
opposition or response.

1The

lodestar method is the “number of hours reasonably expended
on the litigation multiplied by a reasonable hourly rate.”
Hensley v. Eckerhart, 461 U.S. 424, 433 (1983).
2When citing electronic filings throughout this opinion, the
Court cites to the ECF header page number, not the original page
number of the filed document.
2

Addendum, ECF No. 824-2 at IV.C. Specifically, class counsel
seek $3,220,035.85 in fees and $46,656.50 in additional costs
that they contend were not foreseen and therefore not
compensated in the prior award. Final Report to Court on
Payments from the Keepseagle Settlement Fund and Mot. for
Approval of Final Payments Including Suppl. Att’ys’ Fees (“Mot.
for Att’ys’ Fees”), ECF No. 911 at 10, 18. Class counsel also
seek an award of $566,537.50 in fees and $6,987.56 in costs for
Mrs. Keepseagle’s independent counsel, Olsson Frank Weeda Terman
Matz PC (“OFW Law”). Id. Mrs. Keepseagle obtained independent
counsel after the Court asked if she would like the opportunity
to do so to assist her in her efforts to modify the Settlement
Agreement. Id. at 22. Class counsel have provided notice of this
request to the class and to the Trustees of the Trust. Id. at
11.
The Addendum was negotiated after the claims process
concluded and an unanticipated $380 million remained in the
compensation fund for distribution to cy pres beneficiaries. The
Addendum was agreed to by class counsel, the government, and
Mrs. Keepseagle’s counsel, and approved by the Court. See
Keepseagle v. Vilsack, No. 99-3119, slip op. (D.D.C. April 20,
2016), aff’d, 856 F.3d 1039 (D.C. Cir. 2017).
The government disputes that class counsel is entitled to a
supplemental award pursuant to the Settlement Agreement. The
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government argues that the 8% cap on an award of attorneys’ fees
and costs was not increased by the Addendum and therefore an
additional award is not permitted pursuant to the Settlement
Agreement. Def.’s Opp’n to Counsels’ Second Fee Pet. (Def.’s
Opp’n), ECF No. 912 at 6-8. The Court disagrees. The Addendum
clearly contemplates that class counsel and Mrs. Keepseagle’s
counsel 3 would be entitled to seek an award of attorneys’ fees
and costs, which would be made on motion to the Court, with an
opportunity for the government to oppose, and “may be made from
interest that has accrued from the total Compensation Fund.”
Addendum, ECF No. 824-2 at IV.C. Since the Addendum
unambiguously provides that the award would be paid “from
interest that has accrued from the total Compensation Fund,”
this provision overrides the 8% award cap in the Settlement
Agreement. To accept the government’s argument would render this
provision of the Addendum meaningless. See Beal Mort., Inc. v.
FDIC, 132 F.3d 85, 88 (D.C. Cir. 1998)(“the cardinal
interpretative principle [is] that we read a contract to give
meaning to all of its provisions and to render them consistent
with each other.”)(internal quotation marks and citation

3

Although the term “counsel” is not defined in the Addendum, it
was signed by class counsel, Mrs. Keepseagle’s counsel, and
government counsel. Addendum, ECF No. 824-2 at 6-7.
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omitted). Therefore, class counsel is entitled to seek a
supplemental award pursuant to the terms of the Addendum.
“When awarding attorneys’ fees, federal courts have a duty
to ensure that claims for attorneys’ fees are reasonable.”
Swedish Hosp. Corp., 1 F.3d at 1265. “In general, a trial court
enjoys substantial discretion in making reasonable fee
determinations.” Id. at 1271 (citation omitted). “[C]ourts
maintain discretion to award supplemental fees to counsel for
work performed in relation to the litigation or settlement
following counsel’s initial fee application.” Cassese v.
Washington Mut., 27 F. Supp. 3d 335, 339 (E.D.N.Y. 2014)
(internal quotation marks and citations omitted). Courts have
this discretion whether the work for which the supplemental fees
are sought was anticipated or not. Pray v. Lockheed Aircraft
Corp., 1987 WL 9757, at *1 (D.D.C. Apr. 3, 1986). That said, “it
is reasonable to inquire whether any supplemental award of
attorney’s fees for work performed . . . is justified.”
Goldenberg v. Marriott PLP Corp., 33 F. Supp. 2d 434, 440 (D.Md.
1998). “[A] reasonable attorney’s fee is one that is adequate to
attract competent counsel, but . . . that does not produce
windfalls to attorneys.” Blum v. Stenson, 465 U.S. 886, 897
(2010)(internal quotation marks and citation omitted).
The government argues that an additional award is not
reasonable on several grounds: (1) the original award exceeded
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class counsels’ actual and projected fees and costs by nearly
$34 million and so the extra fees and costs incurred have been
covered by that “cushion”; (2) class counsel was overcompensated
for their projected costs when the award was made since the
amount of unclaimed funds–$380 million–was so large; and
(3) class counsels’ original award should have been half of what
it was because the settlement amount was twice what it should
have been. Def.’s Opp’n, ECF No. 912 at 10-12.
Class counsel responds that: (1) the Court has already
rejected the argument that the award was too high when it
awarded to the cap; (2) as a factual matter, it was not overpaid
for the projected costs; and (3) regarding the amount of
unclaimed funds, the settlement amount was fully justified by
the damages calculation of plaintiffs’ expert, but a variety of
factors lead to not all class members being able to, or choosing
to, make their claims. Pls.’ Reply, ECF No. 914 at 3-6. Class
counsel also points out that the government does not contest the
reasonableness of the rates or hours in their request. Id. at 5.
Class counsels’ supplemental request is neither reasonable
nor justified. There is no dispute that this supplemental
request is for work and costs that were not contemplated in
class counsels’ 2011 award request. However, the reason class
counsel needed to undertake this work and incur these costs, was
because of the magnitude of unclaimed funds. Class counsel
6

object to taking into consideration the magnitude of unclaimed
funds because the damages calculation was “fully justified.”
Pls.’ Reply, ECF No. 914 at 5. The Court disagrees that the
magnitude of the unclaimed funds should not be considered.
Although the damages calculation was fully justified, the fact
is that class counsels’ original award was based on a percentage
of a compensation fund amount that exceeded successful claims by
approximately half. The Court recognizes that the Supreme Court
has held it to be a proper application of the common fund
doctrine for an award of fees to be based on a percentage of the
entire fund even if not all funds were disbursed to class
members. See Boeing Co. v. Van Gemert, et al., 444 U.S. 472, 473
(1980). However, the amount not disbursed in that case—$1.5
million out of a $3.2 million settlement fund—as compared to
$380 million out of the $760 million settlement fund here
renders this precedent entirely distinguishable. See id. at 474,
476.
The Court agrees with class counsel that its work on the
Addendum benefitted the class: It resulted in additional
payments to successful claimants and the creation of a Trust to
benefit the members of the class. And class counsels’ work
resulted in this Court approving the Addendum and in that
approval being upheld on appeal. However, the Court must still
determine whether the supplemental award is reasonable. Here,
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the $60.8 million awarded exceeded class counsels’ actual and
projected lodestar fees and costs by approximately $34 million. 4
The Court recognizes persuasive authority approving supplemental
fees where the prior award exceeded lodestar fees and costs,
Pray, 1987 WL 9757, at *2, but doing so here would not be
reasonable. It is neither reasonable nor justified to award
supplemental fees, even though the work was not anticipated,
when the original award: (1) was a percentage of a settlement
fund of this magnitude that exceeded the successful claims by
half; and (2) exceeded actual and projected fees and costs by a
multiplier of 2.3.
Class counsel also seek an award of $566,537.50 in fees and
$6,987.56 in costs for OFW Law, which represented Mrs.
Keepseagle in her efforts to modify the Settlement Agreement.
Mot. for Att’ys Fees, ECF No. 911 at 22. OFW Law was
instrumental in negotiating the Addendum, which obtained $77
million in additional payments to class members, a supplemental
service award of $100,000 to Mrs. Keepseagle, and created the
Trust. See Decl. of Marshall L. Matz in Support of Marilyn
Keepseagle’s Request for an Award of Att’ys’ Fees and Expenses
(“Matz. Decl.”), ECF No. 911-8 ¶ 9. OFW Law also represented

4The

Court recognizes that class counsels’ actual lodestar fees
were somewhat higher than originally projected. See Mot. For
Att’ys’ Fees, ECF No. 911 at 12 n.4.
8

Mrs. Keepseagle in her successful Motion to Modify the
Settlement Agreement, in successfully opposing the appeal of
this Court’s approval of the Addendum to the Court of Appeals
for the District of Columbia Circuit, and in successfully
opposing petitions of certiorari to the Supreme Court. Id.
¶¶ 6,7.
In response to class counsels’ request for this award, the
government reiterates its argument that the Settlement Agreement
does not authorize the payment, but makes no other objection.
Def.’s Opp’n, ECF No. 912 at 12-13. The Court has rejected that
argument. See supra at 3-5. The Addendum specifically provides
that OFW Law would be able to “seek an award of attorneys’ fees
and costs for work involved in establishing the Trust and
Modifying the Agreement” payable from the interest accrued from
the compensation fund. Addendum, ECF No. 824-2 at IV.C.
Unlike the Settlement Agreement, the Addendum did not
provide for the payment of attorneys’ fees as a percentage of
the compensation fund. See id. OFW Law has submitted a lodestar
request for fees and costs. While the source of any award here
will be the interest accrued from the compensation fund, which
is distinct from damages awarded by a court pursuant to the fee

9

shifting provisions the Equal Credit Opportunity Act (“ECOA”) 5,
and because the ECOA underpins this litigation, the Court will
consider whether the lodestar fees requested are reasonable by
reference to the fee shifting provisions of the ECOA. In this
context, this Court has stated:
The
starting
point
for
determining
a
reasonable fee is the “lodestar method,” which
“is the number of hours reasonably expended on
the litigation multiplied by a reasonable
hourly rate.” Hensley v. Eckerhart, 461 U.S.
424, 433, 103 S.Ct. 1933, 76 L.Ed.2d 40
(1983). “[T]he lodestar method produces an
award that roughly approximates the fee that
the prevailing attorney would have received if
he or she had been representing a paying
client who was billed by the hour in a
comparable case[.]” Perdue, 130 S.Ct. at 1672.
There is a “strong presumption” that the
lodestar
figure
represents
a
reasonable
attorney’s fee, id. at 1673, because “ ‘the
lodestar figure includes most, if not all, of
the
relevant
factors
constituting
a
‘reasonable’ attorney’s fee,’ ” id. at 1667
(quoting Pennsylvania v. Delaware Valley
Citizens’ Council for Clean Air, 478 U.S. 546,
566, 106 S.Ct. 3088, 92 L.Ed.2d 439 (1986).
In calculating a reasonable fee award, the
Court must make three separate determinations:
(1) what constitutes a “reasonable hourly
rate” for the services of plaintiff’s counsel;
(2) the number of hours that were reasonably
expended on the litigation; and (3) whether
plaintiff has offered “specific evidence”
demonstrating this to be the “rare” case in
which a lodestar enhancement is appropriate,
and if so, in what amount. Miller v. Holzmann,
575 F.Supp.2d 2, 11 (D.D.C.2008); see also
5See

15 U.S.C. § 1691e(d)(“the costs of the action, together with
a reasonable attorney’s fee as determined by the court, shall be
added to the damages awarded by the court”).
10

Covington v. District of Columbia, 57 F.3d
1101, 1107 (D.C.Cir.1995). The fee applicant,
however, “bears the burden of establishing
entitlement to an award, documenting the
appropriate
hours,
and
justifying
the
reasonableness of the rates [.]” Covington, 57
F.3d at 1107 (citing Blum, 465 U.S. at 896 n.
11, 104 S.Ct. 1541; Hensley, 461 U.S. at 437,
103 S.Ct. 1933). Likewise, “the burden of
proving that an enhancement is necessary must
[also] be borne by the fee applicant.” Perdue,
130 S.Ct. at 1673.[6]
Heller v. District of Columbia, 832 F. Supp. 2d 32, 37-38
(D.D.C. 2011).
First, the Court must determine whether OFW Law’s rates are
reasonable based on its review of OFW Law’s: (1) billing
practices; (2) skill, experience and reputation; and
(3) prevailing market rates in the relevant community. Id. at
38. The Court finds OFW Law’s rates to be reasonable. The
declaration submitted in support of the request attests that the
hourly rates are consistent with the usual and customary rates
for work performed for non-contingency fee clients and that have
been paid by the firm’s commercial clients. Matz. Decl., ECF No.
911-8 ¶ 16. Attached to the declaration are descriptions of the
experience and reputation of counsel upon which the rates are
established. Id. at 11-27. The Court notes the impressive

6

OFW Law does not seek a lodestar enhancement. See generally,
Mot. For Att’ys Fees, ECF No. 911; Pls.’ Reply, ECF No. 914;
Marilyn Keepseagle’s Reply, ECF No. 915.
11

qualifications of Mrs. Keepseagle’s counsel. See id. She was
represented by a skilled team of litigators with significant
relevant experience at both the trial and appellate levels. See
id. Furthermore, the rates are comparable to, and for the most
part lower than, the Legal Services Index (LSI) of the Bureau of
Labor Statistics Laffey Matrix. Compare Matz. Decl., ECF No.
911-8 at 78 with the LSI Laffey Matrix, available at
http://laffeymatrix.com/see.html. Finally, the rates are
comparable to, but slightly higher than, the United States
Attorney’s Office Laffey Matrix. Compare Matz. Decl., ECF No.
911-8 at 78 with USAO Attorney’s Fees Matrix, available at
https://www.justice.gov/usao-dc/file/796471/download. In this
Circuit, either matrix may be used to demonstrate prevailing
market rate. See Covington v. District of Columbia, 57 F.3d
1101, 1109 (D.C. Cir. 1995). After evidence has been provided
demonstrating that counsels’ rates are reasonable, the burden
shifts to the government to produce “equally specific
countervailing evidence” demonstrating that the proposed hourly
rate is “erroneous.” Heller, 832 F. Supp. 2d at 40 (quoting
Covington, 57 F.3d at 1109). Here, however, the government has
not disputed the reasonableness of OFW Law’s rates. See
generally Def.’s Opp’n, ECF No. 912.
Next, the Court must determine whether the number of hours
expended on the litigation was reasonable. See Heller, 832 F.
12

Supp. 2d at 38. The evidence supporting the hours worked must
“be sufficiently detailed to permit the District Court to make
an independent determination whether or not the hours claimed
are justified.” Id. at 49 (quoting Nat’l Ass’n of Concerned
Veterans v. Sec’y of Def., 675 F.2d 1319, 1327 (D.C. Cir. 1982).
The Court finds the number of hours OFW Law expended on the
litigation to be justified. OFW Law claims 1,179.1 attorney, law
clerk and paralegal hours that “were actually expended, in the
exercise of professional judgment, by the lawyers, paralegal
staff, and clerks involved in the matter.” Matz Decl., ECF No.
911-8 ¶ 15. In support, OFW Law submitted detailed,
contemporaneously-made records indicating the amount of time
spent on a particular day on the matter and describing the tasks
performed. Id. ¶ 13, Ex. B at 29-76. The Court has reviewed
these records and, in view of its detailed knowledge of this
matter, finds them to be adequately detailed, and the number of
hours expended justified. OFW Law seeks a total of $566,537.50
in fees for work performed over two and a half years for the
following number of billable hours: Attorney Dillard: 679.8
hours; Attorney Matz: 206.2 hours; Attorney Fried: 79.5 hours;
Attorney Tsien: 43.2 hours; Attorney Durkin: 27.2 hours; Law
Clerk Chapin: 88.5 hours; Law Clerk Ardalan: 30.3 hour; Attorney
Weinreib: 6.5 hours; Paralegal Morgan: 17.9 hours. Id. ¶ 17, Ex.
B at 29-76, Ex. C. Appropriately, the bulk of the billable hours
13

are for a junior attorney with three to six years’ experience,
with the more senior attorneys generally providing a supervisory
role. Again, the government has not disputed the reasonableness
of the number of hours expended. See generally Def.’s Opp’n, ECF
No. 912.
Finally, OFW Law claims $6,987.56 in costs. The Court has
compared the types of costs OFW Law claims to the types of costs
the Court originally approved for class counsel and finds them
to be for the same type of costs, such as telephone charges,
transportation charges, postage, duplicating, filing fees, etc.
Compare Matz. Decl., ECF No. 911-8, Ex. D with Decl. of Joseph
M. Sellers in Supp. of Pls.’ Mot. For an Award of Att’ys’ Fees
and Costs, ECF No. 581-1, Ex. C. Additionally, the costs are not
excessive. Therefore, the Court finds these costs to be
reasonable.

14

Accordingly, the supplemental motion for an award of
attorneys’ fees and expenses is GRANTED IN PART and DENIED IN
PART. Class counsels’ request for supplemental fees and costs is
DENIED. Counsel for Mrs. Keepseagle are awarded $566,537.50 in
fees and $6,987.56 in costs from the interest accrued from the
compensation fund. An appropriate order accompanies this
Memorandum Opinion.
SO ORDERED.
Signed:

Emmet G. Sullivan
United States District Judge
September 21, 2018

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