SPOKOINY,

health and benefits plans: Health

Benefit Plan, Life Insurance Plan,

Short-Term and Long-Term

Disability Plans, and Savings

(401K) Plan,

7001

and

No. 01-35644 SPOKOINY; LARRY SPOKOINY; LESLEY

STUART, D.C. Nos.

CV-98-01646-JCC v.

health and benefits plans: Health

Benefit Plan, Life Insurance Plan,

Short-Term and Long-Term

Disability Plans, and Savings

(401K) Plan,

Appeal from the United States District Court

for the Western District of Washington

John C. Coughenour, District Judge Presiding

Argued and Submitted

February 20, 2002—San Francisco, California

Filed May 15, 2002

Before: Stephen Reinhardt and Michael Daly Hawkins,

Circuit Judges, and William W Schwarzer,*

Senior District Judge.

*The Honorable William W Schwarzer, Senior United States District

Judge for the Northern District of California, sitting by designation.

7002 VIZCAINO v. MICROSOFT CORP.

Opinion by Judge Schwarzer

7003 VIZCAINO v. MICROSOFT CORP.

Charles K. Wiggins, Bainbridge Island, Washington, and Stephen

K. Strong, David F. Stobaugh, Stephen K. Festor and

Brian J. Waid, Bendich, Stobaugh & Strong, P.C., Seattle,

Washington, for the plaintiffs-appellees.

Lawrence W. Schonbrun, Law Offices of Lawrence W.

Schonbrun, Berkeley, California, for the plaintiffs-objectorsappellants.

Carol S. Arnold, Seattle, Washington, for the defendantappellee.

7005 VIZCAINO v. MICROSOFT CORP.

SCHWARZER, Senior District Judge:

Once more we must address an issue arising out of the protracted

litigation between Microsoft Corporation and its freelance

workers, this time to decide whether the district court

abused its discretion in the amount of attorneys’ fees it

awarded to class counsel.

Beginning in 1987, Microsoft supplemented its workforce

with workers known as "freelancers," who agreed in writing

that they would not be eligible for Microsoft employee benefits,

including the Employee Stock Purchase Plan ("ESPP")

and the Savings Plus Plan ("SPP"). In 1992, eight former freelancers

brought this action challenging Microsoft’s refusal to

provide them with benefits under these plans. The district

court certified a class and dismissed the action. After a panel

of this court reversed the dismissal of both the ESPP and SPP

en banc court also reversed the district court’s dismissal of the

ESPP claim, but held that plaintiffs had not exhausted their

administrative remedies for the SPP claim, and remanded that

claim to the plan administrator for adjudication in the first

instance. Vizcaino v. Microsoft Corp., 120 F.3d 1006 (9th Cir.

1997). On remand, the district court substantially narrowed

the class. Vizcaino v. Microsoft Corp., 21 Employee Benefits

Cas. 2821 (BNA), 1998 WL 122084 (W.D. Wash. 1998). This

court then granted mandamus, held the class to include persons

who had worked for Microsoft after 1990, and identified

factors to be applied in determining individual eligibility. Vizcaino

v. United States Dist. Ct. for the W. Dist. of Wash., 173

F.3d 713 (9th Cir. 1999). Settlement negotiations followed,

and after two years the parties submitted a proposed settle-

7006 VIZCAINO v. MICROSOFT CORP.

ment of all claims to the district court. The agreement

required Microsoft to deposit $96,885,000 into a settlement

fund, to be distributed to the class members after payment of

incentive awards, costs, and fees. Microsoft also changed its

staffing and worker classification practices, resulting in the

hiring of over 3000 class members as W-2 employees entitled

to participate in employee benefit plans and programs.

After receiving written submissions and hearing argument,

the district court approved the settlement on extensive findings

of fact and conclusions of law. It then received class

counsel’s application for an award of attorneys’ fees of

$27,127,800 (28% of the cash settlement fund). Two members

of the class objected. After considering the submissions

of counsel and the objectors, and hearing argument on the fee

award, the court entered an order approving class counsel’s

fee request. Vizcaino v. Microsoft Corp., 142 F. Supp. 2d

1299 (W.D. Wa. 2001). Before us now is the objectors’

appeal from that order. We review for abuse of discretion.

Class Plaintiffs v. Jaffe & Schlesinger, P.A., 19 F.3d 1306,

1308 (9th Cir. 1993).

Objectors challenge the district court’s order on three

grounds: First, and principally, that in awarding a fee of 28%

of the settlement fund, it ignored the so-called increasedecrease

rule; second, that in applying a lodestar cross-check,

it used an improper methodology; and third, that in denying

objectors’ fee request without explanation, it abused its discretion.

We address each contention in turn.

[1] The district court found that the settlement fund was the

product of the successful claim for benefits under Microsoft’s

7007 VIZCAINO v. MICROSOFT CORP.

governs the award of fees. Mangold v. Calif. Pub. Utils.

Comm’n, 67 F.3d 1470, 1478 (9th Cir. 1995). Under Washington

law, the percentage-of-recovery approach is used in

calculating fees in common fund cases. Bowles v. Dep’t of

Ret. Sys., 121 Wash. 2d 52, 72, 847 P.2d 440 (1993) (holding

that in a common fund case, "the size of the recovery constitutes

a suitable measure of the attorneys’ performance"). The

district court followed the Washington practice of looking to

federal law for guidance in this area, and we will do the same.

See id. Under Ninth Circuit law, the district court has discretion

in common fund cases to choose either the percentage-ofthe-

fund or the lodestar method. In re Wash. Pub. Power Supply

Sys. Sec. Litig., 19 F.3d 1291, 1295-96 (9th Cir. 1994)

("WPPSS"). Objectors do not challenge the district court’s

choice of the percentage method, only its application.

[2] The district court based its percentage award on Bowles,

which states that "[i]n common fund cases, the ‘benchmark’

award is 25 percent of the recovery obtained," with 20-30%

as the usual range. Bowles, 121 Wash. 2d at 72-73. Ninth Circuit

cases echo this approach. Paul, Johnson, Alston & Hunt

v. Graulty, 886 F.2d 268, 272 (9th Cir. 1989). Objectors contend

that the award is nevertheless excessive, arguing that the

court erred in failing to take into account that this is a megafund

case to which it should have applied what objectors call

the increase-decrease rule. They rely principally on WPPSS,

in which the district court chose the lodestar rather than the

percentage method in awarding fees from a $687 million settlement

fund. The district court observed that "in many cases

awards fall outside the ‘typical’ range and . . . the percentage

Security Act ("ERISA"), 29 U.S.C. § 1132(a), was referred to the SPP

administrator and subsequently to the plan’s administrative committee,

which denied the appeal. The issue was ready for judicial review by the

district court but had not been decided when the settlement of all claims

was reached.

7008 VIZCAINO v. MICROSOFT CORP.

of an award generally decreases as the amount of the fund

increases." WPPSS, 19 F.3d at 1297. We did not adopt this

observation as a principle governing fee awards. Rather, we

merely noted that in cases of that magnitude, fund size is one

relevant circumstance to which courts must refer, stating:

We agree with the district court that there is no necessary

correlation between any particular percentage

and a reasonable fee. With a fund this large, picking

a percentage without reference to all the circumstances

of the case, including the size of the fund,

would be like picking a number out of the air . . . .

Because a court must consider the fund’s size in

light of the circumstances of the particular case, we

agree with the district court that the 25 percent

"benchmark" is of little assistance in a case such as

this.

Id. We concluded that the district court had acted within its

discretion in considering the size of the fund in adopting the

lodestar method.

[3] The 25% benchmark rate, although a starting point for

analysis, may be inappropriate in some cases. Selection of the

benchmark or any other rate must be supported by findings

that take into account all of the circumstances of the case. As

we said in WPPSS, in passing on post-settlement fee applications,

"courts cannot rationally apply any particular

percentage—whether 13.6 percent, 25 percent or any other

number—in the abstract, without reference to all the circumstances

Ass’n, Inc. v. Dunkle, 946 F.2d 768, 775 (11th Cir.

1991) (noting with approval that district courts are increasingly

" ‘supporting their percentage awards with particular

Objectors’ argument that the district court erred in not fixing

a lower percentage, such as one between 6% and 10%, flies

7009 VIZCAINO v. MICROSOFT CORP.

in the face of this reasoning. The question is not whether the

district court should have applied some other percentage, but

whether in arriving at its percentage it considered all the circumstances

of the case and reached a reasonable percentage.

We now turn to the court’s examination of those circumstances.

[4] First, the court found that counsel "achieved exceptional

results for the class." Vizcaino, 142 F. Supp. 2d at 1303.

The court found that counsel pursued this case in the absence

of supporting precedents, in the face of agreements signed by

the class members forsaking benefits—a fact that led four

judges of this court to dissent from the panel and en banc

opinions—and against Microsoft’s vigorous opposition

throughout the litigation. Exceptional results are a relevant

circumstance. See Torrisi v. Tucson Elec. Power Co., 8 F.3d

1370, 1377 (9th Cir. 1993) (considering counsel’s "expert

handling of the case"); Six (6) Mexican Workers v. Ariz. Citrus

Growers, 904 F.2d 1301, 1311 (9th Cir. 1990) (noting

plaintiffs’ "substantial success"); In re Prudential Ins. Co.

Sales Practices Litig., 148 F.3d 283, 339 (3d Cir. 1998)

(observing that "results achieved were ‘nothing short of

remarkable’ " (quoting In re Prudential Ins. Co. Sales Practices

Litig., 962 F. Supp. 572, 585-86 (D.N.J. 1997))).

[5] Second, the court found the case to have been extremely

risky for class counsel for the reasons just stated. Twice plaintiffs

lost in the district court—once on the merits, once on the

class definition—and twice counsel succeeded in reviving

IRS investigation, which resulted in subjecting the workers to income tax

withholding, is beside the point. Because Microsoft had conceded that the

workers were common law employees, the pivotal issue, to which the IRS

investigation was irrelevant, was whether the signed agreements stipulating

that they were "responsible to pay all . . . [their] own benefits" precluded

recovery. Vizcaino, 120 F.3d at 1009; see also Vizcaino, 97 F.3d

at 1197-99.

7010 VIZCAINO v. MICROSOFT CORP.

re Pac. Enter. Sec. Litig., 47 F.3d 373, 379 (9th Cir. 1995)

(holding fees justified "because of the complexity of the

issues and the risks"); Bebchick v. Wash. Metro. Area Transit

Comm’n, 805 F.2d 396, 408 (D.C. Cir. 1986) (considering

counsel’s repeated successes in overturning adverse determinations)

(calculating lodestar); cf. WPPSS, 19 F.3d at 1302

(finding district court’s failure to apply multiplier to lodestar

calculation was abuse of discretion where case was "fraught

with risk and recovery was far from certain").

[6] Third, the court found that counsel’s performance generated

benefits beyond the cash settlement fund. During the

litigation, Microsoft agreed to hire roughly 3000 class members

as regular employees and to change its personnel classification

practices, a benefit counsel valued at $101.48 million

during the 1999-2001 period alone. Vizcaino, 142 F. Supp. 2d

at 1301 n.1. The court observed that the litigation also benefitted

employers and workers nationwide by clarifying the law

of temporary worker classification. Moreover, it noted that as

a result of this litigation, many workers who otherwise would

have been classified as contingent workers received the benefits

associated with full time employment. Incidental or nonmonetary

benefits conferred by the litigation are a relevant

circumstance. See In re Pac. Enter., 47 F.3d at 379 (considering

"nonmonetary benefits in the derivative settlement"); cf.

Bebchick, 805 F.2d 408 (allowing an upward adjustment to

the lodestar "to reflect the benefits to the public flowing from

[the] litigation"); Mills v. Elec. Auto-Lite Co., 396 U.S. 375,

395 (1970) (stating that a corporation may receive a substantial

benefit from a derivative suit justifying a fee award

regardless of whether the benefit is pecuniary).

[7] Fourth, the court found the 28% rate to be at or below

the market rate. It cited the retainer agreements between counsel

and the named plaintiffs promising to pay class counsel

30% of any recovery. The agreements alone, although somewhat

probative of a reasonable rate, are not particularly helpful.

For instance, the retainer agreements did not involve the

7011 VIZCAINO v. MICROSOFT CORP.

class and, because they were made precertification, are not

binding on the class. However, the district court did credit

class counsel’s evidence showing that the retainer agreements

reflected the standard contingency fee for similar cases. This

finding does not constitute an abuse of the court’s discretion.

[8] We note with respect to this factor that we do not adopt

the Seventh Circuit’s approach in percentage fee award cases,

as set forth in In re Continental Illinois Securities Litigation,

962 F.2d 566, 568 (7th Cir. 1992). There, that court stated that

in awarding fees in common fund cases, courts should determine

a reasonable fee by attempting to replicate the market

rate. While an exclusively market-based approach may have

superficial appeal, in the context of class action litigation in

which attorneys’ fees are determined post hoc by the court

(without regard to any private arrangement), it may in many

cases be illusory. Unlike in cases where lawyers compete for

lead counsel status and may even bid in a court-supervised

auction, in employment class actions like this one, no ascertainable

SHEEHEY, AWARDING ATTORNEY’S FEES AND MANAGING FEE LIT

the Northern District of California); In re Auction Houses

Antitrust Litig., 2001 Trade Cas. (CCH) ¶ 73,170, 2001 WL

170792 (S.D.N.Y. Feb. 22, 2001). The "market" is simply

counsel’s expectation of court-awarded fees. The Seventh Circuit’s

effort to construct a market for such cases by determining

what counsel "would have received had they handled a

similar suit on a contingent fee basis, with a similar outcome,

for a paying client" seems to us an unhelpful measure in many

cases, and certainly an inappropriate measure to apply to all

cases. In re Cont’l Ill., 962 F.2d at 572. Unlike commercial

litigation where the fee is determined by application of the

negotiated contingency percentage to the amount of the recovery,

in class action litigation the fee is determined on the basis

of what a court finds to be reasonable. An attempt to "estimate

the terms of the contract that private plaintiffs would

have negotiated with their lawyers [ ] had bargaining occurred

7012 VIZCAINO v. MICROSOFT CORP.

at the outset of the case" strikes us as entirely illusory and

speculative. In re Synthroid Mktg. Litig., 264 F.3d 712, 718

(7th Cir. 2001). Where evidence exists, such as here, about

the percentage fee to which some plaintiffs agreed ex ante,

that evidence may be probative of the fee award’s reasonableness.

But, to the extent that a market analogy is on point, in

most cases it may be more appropriate to examine lawyers’

reasonable expectations, which are based on the circumstances

of the case and the range of fee awards out of common

the class—on a contingency basis—extended over eleven

years, entailed hundreds of thousands of dollars of expense,

and required counsel to forgo significant other work, resulting

in a decline in the firm’s annual income. These burdens are

relevant circumstances. Six (6) Mexican Workers, 904 F.2d at

1311 (noting that litigation lasted more than thirteen years);

Torrisi, 8 F.3d at 1377 (considering counsel’s bearing the

financial burden of the case); Bebchick, 805 F.2d at 407

(same).

[10] We conclude that the district court considered the relevant

circumstances and did not abuse its discretion in finding

a 28% fee award to be reasonable under the percentage

method.

size. The Appendix to this opinion surveys fee awards from 34

common fund settlements of $50-200 million from 1996-2001, with fees

awarded under the percentage method. Awards here range from 3-40%,

with most (27 of 34, or 79%) awards around 10-30% and a bare majority

(19 of 34, or 56%) clustered in the 20-30% range. See also ALBA CONTE,

ATTORNEY FEE AWARDS §§ 2.09, 2.33 and 2.34 (2d ed. 1993 and Nov. 2001

Supp.) (surveying common fund settlements of $25-200 million and finding

a range of 1-30%, with most awards around 5-20%).

7013 VIZCAINO v. MICROSOFT CORP.

The district court applied the lodestar method as a crosscheck

of the percentage method. Calculation of the lodestar,

which measures the lawyers’ investment of time in the litigation,

provides a check on the reasonableness of the percentage

award. Where such investment is minimal, as in the case of

an early settlement, the lodestar calculation may convince a

court that a lower percentage is reasonable. Similarly, the

lodestar calculation can be helpful in suggesting a higher percentage

when litigation has been protracted. Thus, while the

primary basis of the fee award remains the percentage

method, the lodestar may provide a useful perspective on the

The court found that counsel’s fees for work done on this

case, if charged at current hourly rates, would amount to

$7,386,876. It found nothing in the record to suggest that any

of the hours claimed should be disallowed. Objectors quibble

about some of the hours and charges, but we find no abuse of

discretion. See WPPSS, 19 F.3d at 1298-99. Calculating fees

at prevailing rates to compensate for delay in receipt of payment

was within the district court’s discretion. See Gates v.

Deukmejian, 987 F.2d 1392, 1406 (9th Cir. 1992).

Objectors’ principal quarrel is with the district court’s lode-

a lesser fee for settling a case quickly; in many instances, it may be a relevant

circumstance that counsel achieved a timely result for class members

in need of immediate relief. The lodestar method is merely a cross-check

on the reasonableness of a percentage figure, and it is widely recognized

that the lodestar method creates incentives for counsel to expend more

hours than may be necessary on litigating a case so as to recover a reasonable

242 (1985)).

7014 VIZCAINO v. MICROSOFT CORP.

star cross-check, which resulted in a multiplier of 3.65. The

court found this number reasonable by considering the factors

in Kerr v. Screen Actors Guild, Inc., 526 F.2d 67, 69-70 (9th

Cir. 1975), including "the complexity of this case, the risks

involved and the length of the litigation." Vizcaino, 142 F.

Supp. 2d at 1306. The bar against risk multipliers in statutory

fee cases does not apply to common fund cases. WPPSS, 19

F.3d at 1299-1300. Indeed, "courts have routinely enhanced

the lodestar to reflect the risk of non-payment in common

fund cases." Id. at 1300. This mirrors the established practice

in the private legal market of rewarding attorneys for taking

the risk of nonpayment by paying them a premium over their

normal hourly rates for winning contingency cases. Id. at

1299. In common fund cases, "attorneys whose compensation

depends on their winning the case[ ] must make up in compensation

in the cases they win for the lack of compensation

in the cases they lose." Id. at 1300-01 (internal citation and

quotation omitted). Class counsel here have represented that

they would not have taken this case other than on a contingency

basis. They perform little work on an hourly basis, and

the rates they submitted were what they took to be market

rates, in other words, rates that did not already reflect an

expectation of excellent results.

Thus, a multiplier was appropriate in this case. The district

court’s percentage of the fund analysis discussed above

addressed the substantial risk class counsel faced, compounded

by the litigation’s duration and complexity. The

court considered these circumstances in arriving at a multiplier

which was within the range of multipliers applied in

83%) from 1.0-4.0 and a bare majority (13 of 24, or 54%) in the 1.5-3.0

range); Prudential, 148 F.3d at 341 ("[M]ultiples ranging from one to four

are frequently awarded in common fund cases when the lodestar method

is applied." (quoting 3 NEWBERG § 14.03 at 14-5)).

expert is meritless. While the court has discretion to appoint an expert

under Federal Rule of Evidence 706, objectors have not shown how its

decision not to do so was an abuse of discretion.

7015 VIZCAINO v. MICROSOFT CORP.

Objectors contend that the district court abused its discretion

in rejecting their request for attorneys’ fees, arguing that

they caused the district court to require class counsel to submit

time records and that they brought about minor procedural

changes in the settlement agreement. Because objectors did

not increase the fund or otherwise substantially benefit the

class members, they were not entitled to fees. Bowles, 121

Wash. 2d at 70-71 (stating that under Washington law, fees

may be awarded only if authorized by "contract, statute or

recognized ground in equity" (internal citation and quotation

omitted)). The equitable common fund/common benefit doctrine

"authorizes attorney fees only when the litigants preserve

or create a common fund for the benefit of others as

P.A., 19 F.3d 1306, 1308 (9th Cir. 1994). In the

absence of a showing that objectors substantially enhanced

the benefits to the class under the settlement, as a matter of

law they were not entitled to fees, and the district court did

"Because in common fund cases the relationship between

plaintiffs and their attorneys turns adversarial at the feesetting

stage, courts have stressed that when awarding attorneys’

fees from a common fund, the district court must

assume the role of fiduciary for the class plaintiffs." WPPSS,

19 F.3d at 1302. Accordingly, fee applications must be

closely scrutinized. Rubber-stamp approval, even in the

absence of objections, is improper. We are satisfied that in

 

motion raising a dispositive issue of law, Federal Rule of Civil Procedure

54(d)(2)(C) did not apply and no findings of fact were required under Federal

7016 VIZCAINO v. MICROSOFT CORP.

this case, the district court subjected the application to the

requisite scrutiny and did not abuse its discretion in determining

a reasonable fee in light of the relevant circumstances of

the case.

AFFIRMED.

7017 VIZCAINO v. MICROSOFT CORP.

Appendix

Table of Percentage-Based Attorneys’ Fee Awards

In re Rite Aid Corp. Sec. Litig., $193m 25.0% $48m 4.5-8.5

In re Lease Oil Antitrust Litig., $190m 25.0% $47m 1.4

186 F.R.D. 403 (S.D. Tex 1999)

In re Merry-Go-Round Enterprises, Inc., $185m 40.0% $71m 19.6

In re Copley Pharm., Inc.,1 F. Supp. 2d $150m 13.0% $20m 2.0

1407 (D. Wyo. 1998)

Walco Investments, Inc. v. Thenen, 975 $141m 15.0% $21m 1.8

In Re Informix Corp. Sec. Litig., No. 97- $137m 30.0% $40m —

1289 (N.D. Cal Nov. 23, 1999) (Breyer,

J.); cited at 21 Class Action Reports 261

(2000)

In Re Combustion, Inc., 968 F. Supp. $127m 36.0% $46m 3.0

1116 (W.D. La. 1997)

Kurzweil v. Philip Morris Co., 1999 WL $124m 30.0% $37m —

1076105 (S.D.N.Y. 1999) (Mukasey, J.)

In Re Sumitomo Copper Litig., 74 F. $117m 27.5% $32m 2.5

Local 56, United Food & Comm’l $115m 2.8% $3m 2.4

Workers Union v. Campbell Soup Co.,

954 F. Supp. 1000 (D.N.J. 1997)

In Re Ikon Office Sol’ns, Inc., $112m 29.0% $32m 2.5

Sec. Litig., 194 F.R.D. 166

from which fees were calculated using the percentage method, found in the

Westlaw ALLCASES database and Class Action Reports’ attorneys’ fees section

from Jan. 1, 1996 through Dec. 31, 2001. All dollar amounts are rounded to the

nearest million; all percentages are rounded to one-tenth of a percent. Multipliers

are listed where courts conducted a lodestar cross-check.

7018 VIZCAINO v. MICROSOFT CORP.

In Re Sunbeam Sec. Litig., Fed. Sec. L. $110m 25.0% $28m —

Rep. P 91,656, 2001 WL 1636315

(S.D. Fla. Nov 29, 2001)

Bussie v. Allamerica Fin’l Corp., $108m 7.1% $8m 3.3

No. Civ. A. 97-40204, 1999

Haynes v. Shoney’s, No. 89-30093-RV, $105m 23.2% $24m —

1993 WL 19915 (N.D. Fla. Jan. 25,

Ingram v. The Coca-Cola Co., 200 $104m 20.0% $21m 2.5-4.0

Bowling v. Pfizer, Inc., 922 F. Supp. $103m 10.0% $10m 2.1

Fanning v. Acromed Corp., No. 1014, $100m 12.0% $12m 0.6

C.A. 97-381, 2000 WL 1622741

Baird v. Thomson Consumer Elecs., $100m 22.0% $22m —

No. 00-761 (Ill. Cir. Court. Madison

Co. June 15, 2001) (Matoesian, J.);

cited at 22 Class Action Reports

800 (2001)

Rosted v. First USA Bank, No. 97-1482 $87m 11.8% $10m 3.0

(W.D. Wash. June 15, 2001)

(Lasnik, J.); cited at 22 Class Action

In Re Sorbates Direct Purchaser $82m 25.0% $20m —

Antitrust Litig., No. 98-4886

(N.D. Cal. Nov. 20, 2000) (Legge, J.);

cited at 22 Class Action Reports 90

(2001)

In Re Aetna, Inc. Sec. Litig., Fed. Sec. $83m 29.5% $24m 3.6

L. Rep. P 91,322, 2001 WL 20928

In Re Paracelsus Corp. Sec. Litig., $80m 23.0% $18m —

No. 96-3464 (S.D. Tex Jul 22, 99)

(Werlein, J.); cited at 21 Class Action

Reports 262 (2000)

7019 VIZCAINO v. MICROSOFT CORP.

In Re Commercial Explosives Antitrust $77m 30.0% $23m 2.5

Litig., MDL No. 1093

(D. Utah Dec. 29, 1998) (Sam, J.);

cited at 20 Class Action Reports

532 (1997)

Van Vranken v. ARCO, 901 F. Supp. $76m 25.0% $19m 3.6

294 (N.D. Cal. 1995)

Ramah Navajo Chapter v. Babbitt, $76m 11.0% $8m —

50 F. Supp. 2d 1091 (D.N.M. 1999)

Branch v. F.D.I.C., No. Civ. A. $75m 8.6% $6m 2.1

91-CV-13270, 1998 WL 151249

In Re IDB Communications Group, $75m 16.5% $12m 6.2

Inc. Sec. Litig., No. 94-3618 (C.D.

Cal. Jan. 17, 1997) (Hupp, J.); cited at

19 Class Action Reports 472-73

In Re 1996 Medaphis Corp. Sec. Litig., $73m 25.0% $18m —

No. 96-2088 (N.D. Ga. Mar. 27, 1998)

(Thrash, J.); cited at 20 Class Action

In Re MiniScribe Corp., 257 B.R. 56 $67m 4.5% $3m 1.7

(Bankr. D. Colo. 2000)

In Re Nat’l Health Laboratories Sec. $64m 30.0% $19m 2.3

Litig., Nos. 92-1949 & 93-1694

(S.D. Cal. Aug. 15, 1995) (Brooks,

M.J.); cited at 19 Class Action Reports

In Re Telectronics Pacing Systems, Inc., $62m 26.6% $17m 1.0

137 F. Supp. 2d 1029 (S.D. Oh. 2001)

In Re Medical Care America, Inc. Sec. $60m 27.5% $17m —

Litig., No. 92-1996 (N.D. Tex.

Apr. 26, 1996) (Robinson, J.); cited at

19 Class Action Reports 66 (1996)

In Re Melridge, Inc., Sec. Litig., $54m 37.1% $20m 1.4

No. 87-1426 (D. Or. March 19, 1992,

Nov. 1, 1993, and April 15, 1996)

(Frye, J.); cited at 19 Class Action

Reports 65-66 (1996)

7020 VIZCAINO v. MICROSOFT CORP.

In Re Carbon Dioxide Antitrust Litig., $53m 18.0% $10m 1.2

1996-2 Trade Cases P 71,522, 1996

2. The court cited the multiplier range from counsel’s estimates without extensive

discussion. Id. at 736 n.44.

3. The court calculated the multiplier based on counsel’s logs of 12,087 hours and

an assumed hourly rate of $300, concluding "that it is inappropriate to use a lodestar

analysis post-recovery to determine a reasonable fee." Id. at 335.

4. The court noted that this fund included the cash value of waived claims (estimated

at $15 million) and tax refunds (estimated at $1.5 million), and indicated

that the actual value of the fund might be higher. Id. at 1470 n.3.

5. Although recovery for the class was $135 million, preexisting agreement limited

the compensable amount to $117 million. Based on the $135 million figure,

the award percentage was 23.8%. Id. at 394.

6. The court based its calculations on what it described as the "net settlement

fund," or roughly $108 million (roughly $112 million minus roughly $4 million

in costs). We use the gross settlement fund amount, to maintain consistency with

other cases listed. (Although it described the net fund as $108,915,874.43, the

costs as $3,825,497.86, and 30% of the net fund as $32,404,744.33, the fees of

roughly $32.4 million were actually 30% of $108,015,814.43. Id. at 193. Elsewhere,

the court describes the gross fund as $111 million, with earned interest of

$841,000 in five months. Id. at 172.)

7. The court estimated the fund value at $108 million but noted that "the actual

value of the settlement may fall significantly short of the estimated value." Id. at

*2. It therefore awarded the first $4 million in attorneys fees immediately and

withheld the remainder pending further order. Id. at *3.

8. In addition to the common fund of $105 million, other relief was valued at $30

million.

9. The fund amount excludes $10 million in a "Promotional Achievement Fund"

and $43.5 million in "future pay equity adjustments." Id. at 688.

10. The settlement allowed the fund of roughly $103 million to increase by up to

roughly $63 million in the following ten years, and counsel were allowed to petition

for 10% of the increase amount each year, up to an additional $6 million

approximately. Id. at 780.

11. The defendant’s assets were worth only $58 million. Id. at *5.

7021 VIZCAINO v. MICROSOFT CORP.

12. The court noted that a multiplier of at least 3.0 would be appropriate, but that

would have resulted in an award greater than that requested by counsel.

13. The court described the fee as 30% of the net fund of roughly $81 million,

after subtracting roughly $2 million in costs. We use the gross settlement fund

amount, to maintain consistency with other cases listed.

14. The court described the $75 million figure as "the likely amount" of the fund.

Id. at *2.

15. The court noted that the lodestar of approximately $2 million "would have to

be deflated an estimated 10% to 20% for some excessive rates and duplicative

hours," resulting in a multiplier of 6.9-7.7.

16. Fund consisted of a mix of cash, stock, and warrants, so fees were granted in

same proportion.

17. The 2.3 multiplier is inflated because the lodestar is based on historical (not

prevailing) hourly rates and therefore fails to compensate attorneys for the time

value of money.

18. The court described the award as 18.5% of the net fund (after subtracting

roughly $1.6 million in costs). Id. at *2.

7022 VIZCAINO v. MICROSOFT CORP.