Kater v. Churchill Downs Incorporated

Filing 290

ORDER granting Class Counsel's 263 Motion for Attorney Fees, Costs, and Class Representative Incentive Awards. The Court awards Class Counsel $38,750,000 in attorneys' fees; awards Class Counsel costs and expenses in the amount of $1,590,690; awards Cheryl Kater and Manasa Thimmegowda incentive awards of $10,000; and awards Suzie Kelly an incentive award of $50,000. Signed by Judge Robert S. Lasnik. (LH)

Case 2:15-cv-00612-RSL Document 290 Filed 02/11/21 Page 1 of 5

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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CHERYL KATER and SUZIE KELLY,
individually and on behalf of all others similarly
situated,

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Plaintiffs,
v.

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Defendants.
MANASA THIMMEGOWDA, individually and
on behalf of all others similarly situated,
Plaintiffs,

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ORDER GRANTING CLASS
COUNSEL’S MOTION FOR
ATTORNEYS’ FEES, COSTS, AND
CLASS REPRESENTATIVE
INCENTIVE AWARDS

CHURCHILL DOWNS INCORPORATED, a
Kentucky corporation, and BIG FISH GAMES,
INC., a Washington corporation.

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No. 15-cv-00612-RSL

v.

No. 19-cv-00199-RSL
ORDER GRANTING CLASS
COUNSEL’S MOTION FOR
ATTORNEYS’ FEES, COSTS, AND
CLASS REPRESENTATIVE
INCENTIVE AWARDS

BIG FISH GAMES, INC., a Washington
corporation; ARISTOCRAT TECHNOLOGIES
INC., a Nevada corporation; ARISTOCRAT
LEISURE LIMITED, an Australian corporation;
and CHURCHILL DOWNS INCORPORATED,
a Kentucky corporation,

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Defendants.

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Order - i

E DELSON PC
350 N LaSalle Street, 14th Floor, Chicago, IL 60654
Tel: [phone] • Fax: [phone]

Case 2:15-cv-00612-RSL Document 290 Filed 02/11/21 Page 2 of 5

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WHEREAS, Plaintiffs have submitted authority and evidence supporting Class Counsel’s
Motion for Award of Attorneys’ Fees and Expenses and Issuance of Incentive Awards; and

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WHEREAS, the Court, having considered the Motion and being fully advised, finds that
good cause exists for entry of the Order below; therefore,

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IT IS HEREBY FOUND, ORDERED, ADJUDGED, AND DECREED THAT:

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1.

Unless otherwise provided herein, all capitalized terms in this Order shall have

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the same meaning as set forth in Class Counsel’s Motion for Award of Attorneys’ Fees and

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Expenses and Issuance of Incentive Awards.

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2.

The Court confirms its appointment of Jay Edelson, Rafey S. Balabanian, Todd

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Logan, Alexander G. Tievsky, and Brandt Silver-Korn of Edelson PC as Class Counsel.

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A.

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Attorneys’ Fees
3.

Class Counsel has requested the Court calculate their award using the percentage-

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of-the-fund method. Class Counsel requests the Court award 25% of the $155 million common

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fund as attorneys’ fees.

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4.

These requested attorneys’ fees, which reflect the “benchmark” fee award in

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common fund cases, are fair and reasonable. See Vizcaino v. Microsoft Corp., 290 F.3d 1043,

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1052 (9th Cir. 2002). The Court reaches this conclusion after analyzing: (1) the extent to which

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class counsel achieved exceptional results for the class; (2) whether the case was risky for class

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counsel; (3) whether counsel’s performance generated benefits beyond the cash settlement fund;

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(4) the market rate for the particular field of law; (5) the burdens class counsel experienced while

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litigating the case; (6) and whether the case was handled on a contingency basis. In reaching this

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conclusion, the Court has also taken into account the settlements reached, and fee awards

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requested, in the Wilson v. Huuuge and Wilson v. Playtika actions.

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5.

Class Counsel performed exceptional work and achieved an exceptional result for

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the Class. Class Members stand to recover substantial portions of their Lifetime Spending

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Amount on Defendants’ Applications.

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Order - 1

E DELSON PC
350 N LaSalle Street, 14th Floor, Chicago, IL 60654
Tel: [phone] • Fax: [phone]

Case 2:15-cv-00612-RSL Document 290 Filed 02/11/21 Page 3 of 5

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6.

Class Counsel further achieved exceptional non-monetary benefits for the Class.

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Among other things, Defendants have agreed to meaningful prospective relief for the Class,

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including providing addiction-related resources on the Applications and creating a robust self-

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exclusion policy within the Applications.

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7.

This litigation was extremely risky for Class Counsel. Class Counsel worked

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entirely on contingency, prosecuted a line of several class actions against well-funded

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corporations, and pursued an entirely novel legal theory: that Defendants’ internet-based “social

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casinos” violated Washington’s “Return of Money Lost at Gambling” statute (RCW 4.24.070).

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Class Counsel also defended the Class’s interests before the Washington State Gambling

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Commission and the Washington State Legislature.
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The market also supports Class Counsel’s fee request. Contingency arrangements

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in high-stakes, high-value mass litigation typically fall in the range of 30-40%. See Declaration

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of Charles M. Silver (“Silver Decl.”) ¶¶ 20, 29, 36. Further, the mean percentage award of

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attorneys’ fees in class actions in the Ninth Circuit is 24.5% of the common fund, and the mean

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percentage award in this District is 26.98%. See Declaration of William B. Rubenstein

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(“Rubenstein Decl.”) ¶ 14.

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9.

The Court is not required to conduct a lodestar cross-check, Farrell v. Bank of

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Am. Corp., N.A., 827 F. App’x 628, 630 (9th Cir. 2020), and declines to do so here. Given the

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unique circumstances presented by this litigation, in particular the significant amount of non-

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legal work that had to be performed to turn back industry efforts to obtain protective legislation

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and to prevent participation in this lawsuit, the Court concludes that a lodestar cross-check would

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not be a valuable tool to help assess the reasonableness of Class Counsel’s fee request. See

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Rubenstein Decl. ¶¶ 18-22; Silver Decl. ¶¶ 74-78.

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10.

The Court grants Class Counsel’s request for a fee award of 25% of the common

fund, or $38,750,000.

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Order - 2

E DELSON PC
350 N LaSalle Street, 14th Floor, Chicago, IL 60654
Tel: [phone] • Fax: [phone]

Case 2:15-cv-00612-RSL Document 290 Filed 02/11/21 Page 4 of 5

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B.

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Costs and Expenses
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In addition to the fee request, Class Counsel requests reimbursement of

$1,785,942.27 in costs and expenses.

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The Court finds most of these costs and expenses to be reasonable and

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appropriate. See Dennings v. Clearwire Corp., No. C10-1859-JLR, 2013 WL 1858797, at *10

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(W.D. Wash. May 3, 2013), aff’d (Sept. 9, 2013). The amount will be reduced, however, by costs

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related to activities which justified a fee award far in excess of the lodestar amount, namely the

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$110,827 in lobbying fees paid to oppose the industry’s efforts to change Washington gambling

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laws and the $84,425.27 in internet advertising expenses related to identifying and engaging with

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class members who wanted to opt out of the revised terms and conditions. The Court

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consequently awards Class Counsel reimbursement of $1,590,690 in costs and expenses.

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C.

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Incentive Awards
13.

Class Counsel requests an incentive award of $10,000 each for Cheryl Kater and

Manasa Thimmegowda and an incentive award of $50,000 for Suzie Kelly.

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14.

The requested incentive awards are fair and reasonable. Kater and Thimmegowda

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invested substantial time in this case, risked reputational harm, and otherwise made significant

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contributions to the Class. A $10,000 incentive award is reasonable for their services. See

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McClintic v. Lithia Motors, Inc., No. C11-859RAJ, 2011 WL 13127844, at *6 (W.D. Wash. Oct.

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19, 2011). Kelly’s service to and sacrifice for the Class was unique, substantial, and far beyond

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the typical contributions of a class representative. A $50,000 incentive award is reasonable for

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her services. See, e.g., del Toro Lopez v. Uber Techs., Inc., 17-cv-6255, 2018 WL 5982506, at *3

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(N.D. Cal. Nov. 14, 2018).

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D.

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Conclusion
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Based on the foregoing findings and analysis, the Court awards Class Counsel

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$38,750,000 in attorneys’ fees; awards Class Counsel costs and expenses in the amount of

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$1,590,690; awards Cheryl Kater and Manasa Thimmegowda incentive awards of $10,000; and

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awards Suzie Kelly an incentive award of $50,000.
Order - 3

E DELSON PC
350 N LaSalle Street, 14th Floor, Chicago, IL 60654
Tel: [phone] • Fax: [phone]

Case 2:15-cv-00612-RSL Document 290 Filed 02/11/21 Page 5 of 5

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IT IS SO ORDERED.

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Dated this 11th day of February, 2021.

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ROBERT S. LASNIK
UNITED STATES DISTRICT JUDGE

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Order - 4

E DELSON PC
350 N LaSalle Street, 14th Floor, Chicago, IL 60654
Tel: [phone] • Fax: [phone]