Thieme et al v. Chesapeake Energy Corporation et al

Filing 244

ORDER granting plaintiffs' 237 motion for award of attorney fees, reimbursement of expenses, and approval of incentive awards...see order for specifics. Signed by Honorable Joe Heaton on 4/25/2019. (cla)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF OKLAHOMA

IN RE ANADARKO BASIN OIL AND
GAS LEASE ANTITRUST LITIGATION

Case No. CIV-16-209-HE

ORDER GRANTING PLAINTIFFS’ MOTION FOR ATTORNEYS’ FEES,
REIMBURSEMENT OF EXPENSES, AND INCENTIVE AWARD

This matter comes before the court on Plaintiffs’ Motion for Attorneys’ Fees,
Reimbursement of Expenses, and Incentive Awards. The court has considered (1) the
Settlement Agreement, dated August 30, 2018 [Doc. #220-2]; (b) the court’s December
18, 2018, Preliminary Approval Order [Doc. #231]; (c) Plaintiffs’ Motion for Attorneys’
Fees, Reimbursement of Expenses, and Incentive Awards [Doc. #237] and supporting
documents; and (d) the Declaration of Warren T. Burns on Behalf of Class Counsel in
Support of Plaintiffs’ Motion for Final Approval of Class Settlement and Plaintiffs’
Motion for Attorneys’ Fees, Reimbursement of Expenses, and Incentive Awards [Doc.
#238-1] and related exhibits. Additionally, on April 25, 2019, the court held a Fairness
Hearing regarding the parties’ Settlement Agreement. Upon considering all of the
submissions and arguments with respect to the Settlement, and upon full information and
for good cause shown the court finds and concludes as follows:
1.

Upon review of the record, the court concludes that Class Counsel’s

requested award of attorneys’ fees in the amount of one-third of the $6.95 million cash
value of the Settlement (the “Settlement Fund”) after deduction of expenses and incentive

awards, $2,316,666.67, is within the applicable range of reasonable attorneys’ fees
percentage-of-recovery awards established by relevant precedent.
2.

The percentage-of-recovery method of calculating attorneys’ fee awards is

appropriate in this action. See, e.g., In re Sandridge Energy, Inc., 2015 WL 11921422, at
*2 (W.D. Okla. Dec. 22, 2015), aff’d sub nom. In re SandRidge Energy, Inc., 875 F.3d
1297 (10th Cir. 2017); Shaw v. Interthinx, Inc., 2015 WL 1867861, at *5 (D. Colo. Apr.
22, 2015).
3.

The relevant factors used to determine whether a common fund fee is

reasonable, as articulated by the Tenth Circuit in Johnson v. Georgia Hwy. Expr., Inc.,
488 F.2d 714 (5th Cir. 1974), support a conclusion that the requested fee is reasonable.
These factors are:
(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 similar
cases.
See Brown v. Phillips Petroleum Co., 838 F.2d 451, 454-55 (10th Cir. 1988) (citing
Johnson, 488 F.2d at 717-19).
4.

The time and labor spent by Class Counsel support the requested fee award.

This action has spanned three years and has required Counsel to engage in motion
practice, substantial fact discovery, expert analysis, multiple days of mediation, and
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ongoing arms-length settlement negotiations. Counsel filed motions and pleadings,
conducted and defended depositions, interviewed witnesses, reviewed millions of pages
of documents, and served and responded to numerous requests for written and
documentary discovery. See [Doc. #238-1] at ¶ 25. The time and effort spent by Class
Counsel on this matter was both substantial and appropriate in light of the circumstances
of this case.
5.

The fee’s reasonableness is further illustrated by a lodestar crosscheck,

which indicates that Plaintiffs’ requested fee award represents a negative multiplier on
Class Counsel’s lodestar amount. See [Doc. #28-1] at ¶ 30. Accordingly, this factor
supports the requested award in the amount of one-third of the Settlement Fund.
6.

This matter included numerous factual and legal challenges, requiring Class

Counsel to exercise skill and expertise to effectively pursue Plaintiffs’ claims on behalf
of the Class. By their nature, conspiracies such as that alleged by Plaintiffs are difficult to
prove. See, e.g., Hamilton v. Arnold, 29 F. App’x 614, 616 (1st Cir. 2002) (observing
“the sine qua non of a conspiracy, the agreement, is exceedingly difficult to prove
directly”). The specific facts of this case, which left Plaintiffs with only circumstantial
evidence of Defendants’ alleged conspiracy, made that particularly true.
7.

Plaintiff faced significant evidentiary challenges had this matter proceeded

to class certification, summary judgment, and ultimately, trial. These included an alleged
co-conspirator’s failure to maintain an electronic database containing information at the
heart of Plaintiffs’ claims; that same co-conspirator’s bankruptcy, which removed that
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alleged co-conspirator from the case and made it more difficult for Plaintiffs to obtain
documents and testimony; and the death of Defendant Chesapeake’s CEO and founder,
who was a central figure in Plaintiffs’ allegations. A number of potential Class members
with strong claims against Defendants entered into individual settlements and releases
with Defendants, creating additional evidentiary hurdles.
8.

Defendant Chesapeake’s admission to a limited number of anticompetitive

agreements in response to an investigation by the Department of Justice created a further
challenge for the prosecution of Plaintiffs’ claims. Having admitted to ten isolated
anticompetitive transactions, Chesapeake maintained its wrongdoing was limited to
solely the ten agreements uncovered in the DOJ investigation, and that no broader
wrongdoing occurred and no broader class-wide injury exists. See, e.g., [Doc. #181] at ¶¶
1-4.
9.

All of the forgoing circumstances posed difficulties requiring the skill of

counsel and created risk for the Class.
10.

Additionally, Class Counsel took on significant risk by accepting this case

on a purely contingent basis. The risk of litigating on a contingent basis further supports
the requested fee. Lucas v. Kmart Corp., 2006 WL 2729260, at *6 (D. Colo. July 27,
2006) (“Given the risk of non-recovery, this factor weighs heavily in favor of the
requested fee.”)
11.

The customary fees awarded in common fund class actions in this Circuit

support Plaintiffs’ requested fee in the amount of one-third of the common fund: In the

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Tenth Circuit, a “contingency fee of one-third is relatively standard in lawsuits that settle
before trial.” Lewis v. Wal-Mart Stores, Inc., No. 02-CV-0944 CVE FHM, 2006 WL
3505851, at *1 (N.D. Okla. Dec. 4, 2006).
12.

Under the parties’ Settlement Agreement, Defendants will pay $6,950,000

to the Class. The immediate certainty and finality of settlement is, itself, a benefit to the
Class. See Childs v. Unified Life Ins. Co., 2011 WL 6016486, at *13 (N.D. Okla. Dec. 2,
2011) (“The class . . . is better off receiving compensation now as opposed to being
compensated, if at all, several years down the line, after the matter is certified, tried, and
all appeals are exhausted.”).
13.

Following dissemination of notice to more than 13,000 potential class

members, no member has objected to the settlement and only one has opted out of the
Class as of the date of the hearing. [Doc. #238-1] at ¶ 22. This further demonstrates the
reasonableness of the Settlement and of Class Counsel’s fee award. See In re Crocs, Inc.
Sec. Litig., 2014 WL 4670886, at *5 (D. Colo. Sept. 18, 2014) (lack of objections weighs
in favor of requested award); Anderson v. Merit Energy Co., 2009 WL 3378526, at *4 (D.
Colo. Oct. 20, 2009) (same).
14.

On December 18, 2018, the Court granted preliminary approval of the

Settlement, certified the Class for purposes of settlement, and appointed Burns Charest
LLP, Cohen Milstein Sellers & Toll PLLC, Susman Godfrey LLP, and Schneider
Wallace Cottrell Konecky Wotkyns, LLP (collectively, “Co-Lead Counsel”) as Class
Counsel for the Settlement Class. Each of these firms has significant experience and is
well-respected in the fields of antitrust and class action litigation. See [Doc. #238-1] at ¶
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27; Other experienced antitrust firms, acting under the direction of Class Counsel, have
also served as counsel for the Class. This factor further supports the requested fee award.
15.

Accordingly, the relevant Johnson factors counsel in favor of Class

Counsel’s fee request, amounting to one-third of the Settlement Fund.
16.

Both the Long-Form and the Short-Form Notices indicated that Class

Counsel would seek a fee award of up to one-third of the Settlement amount in addition
to reimbursement of costs and expenses. [Doc. #234-2]; [Doc. #234-5].
17.

The court concludes that Class Counsel’s request for reimbursement of

their reasonably incurred expenses should be granted, as the expenses incurred are
reasonable and proper for a case of this type.
18.

Accordingly, Class Counsel’s request for reimbursement of litigation costs

and expenses in the amount of $326,591.33 is GRANTED.
19.

The court concludes that Class Counsel’s request for incentive awards of

$10,000 for each of the six Class Representatives—Edward Clark, Inc., Curtis Crandall,
Amy Herzog, Mahony-Killian, Inc. (“Mahony-Killian”), Ida Powers, and Brian
Thieme—is appropriate. See 5 NEWBERG ON CLASS ACTIONS § 17:1 (5th ed.) (“At the
conclusion of a class action, the class representatives are eligible for a special payment in
recognition of their service to the class.”); Lachney v. Target Corp., No. CIV-03-1685HE, 2010 WL 11509187, at *2 (W.D. Okla. Sept. 16, 2010) (incentive awards to class
representatives “encourage socially beneficial litigation by compensating named
plaintiffs for their expenses on travel and other incidental costs, as well as their personal

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time spent advancing the litigation on behalf of the class and for any personal risk they
undertook.”).
20.

Each Class Representative expended time and effort to facilitate classwide

resolution of Plaintiffs’ claims: They searched for, collected, and provided documents in
discovery, propounded interrogatory responses, and sat for interviews with Counsel.
[Doc. #238-1] at ¶ 45. Mahony-Killian, Ida Powers, and Brian Thieme each additionally
prepared and sat for depositions, and the remaining Class Representatives were in the
process of scheduling depositions when the Settlement was reached. Id..
21.

The $10,000 incentive awards accord with the amounts typically awarded

in common fund class action cases. See, e.g., Fankhouser v. XTO Energy, Inc., 2012 WL
4867715, at *3 (W.D. Okla. Oct. 12, 2012) (granting incentive awards up to $40,000);
McNeely v. Nat’l Mobile Health Care, LLC, 2008 WL 4816510, at *16 (W.D. Okla. Oct.
27, 2008) (preliminarily approving $15,000 incentive award). Accordingly, Class
Counsel’s request for incentive awards of $10,000 for each of the six Class
Representatives is GRANTED.
22.

Based on the foregoing findings and conclusions, Plaintiffs’ Motion for

Award of Attorney Fees, Reimbursement of Expenses, and Approval of Incentive
Awards [Doc. #237] is GRANTED as stated above.
IT IS SO ORDERED.
Dated this 25th day of April, 2019.

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