M. CASEY RODGERS, Magistrate Judge.
Common Benefit Fund Order No. 1, entered by this Court on February 21, 2017, appointed Randy Sansom as CPA and me as Common Benefit Special Master.
As the Order issued by this Court on February 25, 2019 states, early in 2019, the Parties reached a settlement and entered into a Confidential Master Settlement Agreement.
Over the last several months, as described below, law firms making requests for awards of common benefit expense reimbursements and fees have submitted Applications and made oral presentations pursuant to the requirements of CBO 6. Additionally, I have consulted with the PFFC, Mr. Sansom, and Co-Lead Counsel, and I have had discussions with numerous Plaintiff Leadership firms. Having received information from these many sources, on November 5, 2019, I circulated to all law firms that applied for common benefit expense or fee awards a confidential proposal for an agreed-upon allocation of fees (by percentage of the total). I requested that any firm objecting to this proposal notify me by the end of the day on November 7, 2019. No firm objected, and many expressed their support for it. Accordingly, my recommendation in this Report & Recommendation regarding the common benefit fee allocation is one that has been accepted by all affected firms.
As described in greater detail below at Section V, it appears likely that a total of approximately $18,940,000.00 will be available to reimburse firms for their capital contributions, to reimburse firms for common benefit expenses appropriately submitted as held costs, and to award common benefit fees. As described below, the firms seeking common benefit awards performed a significant volume of work, resulting in a successful global settlement in a tort that presented challenging legal and scientific issues.
My recommendations are as follows:
On October 3, 2016, the Judicial Panel on Multidistrict Litigation centralized 22 Abilify cases pending in various federal courts and transferred those cases to the United States District Court for the Northern District of Florida, thus creating MDL 2734, In re: Abilify (Aripiprazole) Products Liability Litigation.
On October 19, 2016, the Court appointed Kristian Rasmussen of Cory Watson Attorneys ("Cory Watson") and Gary Wilson of Robins Kaplan LLP ("Robins Kaplan") as interim Co-Lead Counsel for Plaintiffs, and appointed Bryan Aylstock of Aylstock, Witkin, Kreis & Overholtz, PLLC ("AWKO") as interim Liaison Counsel.
Plaintiffs' counsel worked quickly and diligently, conducting discovery and preparing their case in a fast-paced litigation with ambitious deadlines. It was apparent early in the litigation that establishing general causation would be a critical task for Plaintiffs, and as such, the bulk of the first eight to nine months of the litigation centered around preparation for general causation/Daubert hearings. The Daubert evidentiary hearing spanned four days and included Plaintiffs' counsel presenting four witnesses for live testimony: Antoine Bechara, Joseph Glenmullen, Eric Hollander, and David Madigan.
After hearing the Parties' arguments and reviewing the voluminous record, the Court, in a 164 page order indicative of the complexity of the issue and reflective of the amount of preparation and effective advocacy by Plaintiffs' counsel, concluded that "Plaintiffs have satisfied their burden to demonstrate that a genuine dispute of material fact exists as to whether Abilify can cause uncontrollable impulsive behaviors in individuals taking the drug," and thus denied Defendants' Motion for Summary Judgment.
Concurrent with discovery and preparation related to general causation and the Daubert hearing, the Court selected the six cases originally filed in the Northern District of Florida for case-specific work up ("First Trial Pool").
On August 10, 2018, the Court randomly selected forty cases for case-specific discovery ("Second Discovery Pool") and permitted each side to strike five cases from the pool.
Early in the litigation, upon the recommendation of the Joint Settlement Committee, the Court appointed Cathy Yanni as Settlement Master.
After several months of negotiations and in-depth case review, the Parties reached agreement and on February 15, 2019, announced that they had entered into a Confidential Master Settlement Agreement intended to resolve Abilify compulsivity claims pending in state and federal courts throughout the United States.
Pursuant to CBO 1, the Plaintiffs' Executive Committee had the authority to make assessments to "effectively prosecute the interests of the litigation."
CBO 1 required all Plaintiffs' counsel seeking to recover common benefit fees and/or expenses to "keep a daily contemporaneous record of their time and expenses, noting with specificity the amount of time and particular activity along with confirmation that authority was obtained to have undertaken that common benefit effort."
Eighteen firms (thirteen with Leadership appointments and five without such appointments) submitted Applications totaling approximately 70,400 hours for common benefit consideration.
The common benefit doctrine permits "the creation of a common fund in order to pay reasonable attorneys' fees for legal services beneficial to persons other than a particular client, thus spreading the cost of the litigation to all beneficiaries."
In the Eleventh Circuit, Camden I Condominium Ass'n, Inc. v. Dunkle stated that the factors enunciated in Johnson v. Georgia Highway Exp., Inc., 488 F.2d 714 (5
(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.
While the Johnson factors serve as guidance for determining a fee award, the Camden court noted that those factors are not exclusive because "any fee must be determined upon the facts of each case,"
Common Benefit Order No. 6 sets forth the process by which law firms could apply for common benefit expense reimbursements and fee awards.
Additionally, CBO 6 provides that each firm submitting an Application had the right to make an oral presentation, which would be recorded by a court reporter.
In addition, as noted above, Mr. Sansom and I discussed the possibility of an agreed-upon fee allocation with the PFFC, Co-Lead Counsel, and lawyers from many of the law firms that had submitted Applications.
In making my recommendations as to expense and fee awards, I was guided by both the Johnson factors described above and the considerations set forth in CBO 6:
As the Order notes, my review was to be a qualitative analysis, not one driven solely by numbers of hours worked or by financial contributions.
In making my proposal for a percentage allocation of fees, I considered (in no particular order):
The fact that my proposal regarding allocation of fees had the support of the affected firms strongly influenced my recommendation. CBO 6 specifically recognizes that an agreement such as this can be considered.
On April 11, 2018, the Court entered Common Benefit Fund Order No. 5, which established a holdback assessment of 9% on any Settlement
Additionally, the Settlement Agreement specified that part of the settlement funds should be deposited into the Common Benefit Fund.
I recommend that capital contributions should be fully reimbursed before any other payments are made, as these enabled the litigation to be funded and aggressively pursued.
In considering expenses, I was cognizant of the fact that there is a relatively limited amount of money to be divided among the common benefit attorneys in this litigation. Due to the limited funds, it would not be cost effective for Mr. Sansom and me to do an item by item review of all submitted expenses. Our preliminary review of these expenses eliminated duplicate entries and expenses that had previously been paid as shared costs and confirmed that the expenses were all incurred in connection with work on the Abilify litigation. After that review, the total amount of expenses remaining was $1,539,845.35. I recommend reimbursement of firms' expenses as follows:
Eighteen law firms applied for a common benefit fee award. Each submitted the Application as described in CBO 6, and eleven of them made oral presentations to Mr. Sansom and me in late October. On November 5, 2019, I circulated by email to these eighteen law firms a proposed percentage allocation of common benefit fees and asked that they inform me by the end of the day on November 7, 2019 if they objected to this proposal. I informed them in the original November 5 email that if they did not communicate an objection to me, I would assume that they had none. I reiterated this assumption in another email to those who had not responded as of November 7, 2019. I received no objections, and sixteen firms contacted me indicating either support for or lack of opposition to the proposed percentage allocation; two firms did not respond, and thus, as indicated in my emails, I assume they have no objection. Accordingly, I view the percentage allocations below as agreed-upon by the affected law firms.
The fact that those who were closest to the day-to-day work of the Abilify litigation agree to this allocation is strong evidence that it reflects a reasonable allocation of common benefit fees.
I am informed by the CPA that, after reimbursing the $3,610,000.00 for return of capital contributions and $1,539,845.35 for expenses, approximately $13,792,225.42 will remain in the Common Benefit Fund. After consultation with the CPA, I recommend that $131,475.42 of that amount be held in reserve to pay any additional bills that are received, and thus $13,660,750.00 be distributed using the above percentages. If the Court were to accept this recommendation, the amount to be paid to each firm for common benefit fees would be as follows:
The agreed-upon distribution that I circulated to the firms allocates only 98.39% of the funds available for fees, providing for a 1.61% remainder to account for any future administration expenses. Thus, the total amount retained in the Common Benefit Fund for currently pending and potential additional expenses would be approximately $350,000.00 ($131,475.42 holdback plus $219,938.08 remainder). To the extent that amount is not spent on bills and/or administration by the end of March 2020, I will submit to the Court a Report & Recommendation recommending its apportionment among those firms who submitted Common Benefit Applications.
The materials submitted in the Applications and the information I received in the oral presentations guided me in formulating this proposal. Described below are brief summaries of my considerations in assigning a percentage allocation to each firm.
I recommend awarding 57.75% of the money available for common benefit fees to these three firms (19.25% to each). By all accounts, the Plaintiffs' lawyers participating in this litigation viewed these three firms as the leaders and those who were most responsible for achieving the successful result. There were somewhat differing views about which of the three made greater or lesser contributions than the other two, but no one disputed that these three firms together should receive the highest awards. My assessment is that each firm played a somewhat different role, but that it is not appropriate to distinguish among them for purposes of a fee award.
Robins Kaplan had the highest number of hours and expenses invested in the litigation, and it, along with Cory Watson, made the largest capital contribution ($500,000.00). Gary Wilson was Co-Lead Counsel and played an important role in all aspects of the litigation, including getting the litigation started by bringing cases in multiple venues before bringing this matter to the JPML. Additionally, others from the firm were repeatedly cited as playing significant roles in two of the most important aspects of the litigation: trial-pool work-up and the Daubert hearing. In particular, Tara Sutton, Julie Reynolds, and Munir Meghjee were often cited as making important contributions to the litigation. Tara Sutton in particular was credited for her substantial role in the Daubert hearing. Ms. Sutton presented opening and closing arguments at the Daubert hearing, and she presented testimony from Drs. Glenmullen and Hollander. In addition, Mr. Wilson presented testimony from Dr. Bechara, and Mr. Meghjee cross-examined Defense expert Dr. Winstanley. The firm completely worked up the Lyons trial pool case for trial, and it assisted in the work-up of the other trial and discovery pool cases, including by providing sample templates of key documents and witness outlines to firms with trial and discovery pool cases.
Cory Watson also made the highest capital contribution ($500,000.00) and had significant hours and expenses. Kristian Rasmussen served as Co-Lead Counsel; he routinely participated in court appearances, was involved in working up the trial and discovery pool cases and provided lawyer and paralegal support to others on the team at the Daubert hearing and other key litigation events. Stephen Hunt, Jr. from Cory Watson was also credited by others as playing an active role in the litigation. Ernest Cory is credited, along with Bryan Aylstock, for bringing about the settlement. Cory Watson was actively involved in preparing for trial in the Viechec case and worked up additional cases in both groups of Plaintiffs selected as potential trial pool cases. Messrs. Rasmussen and Hunt were also involved in the taking of Defendants' corporate witness depositions.
AWKO by all accounts played a key leadership role in the litigation. Bryan Aylstock's official position was Liaison Counsel (and PFFC member), but the universal view of his colleagues is that he played a much more significant role in bringing about the successful resolution of this litigation than the Liaison Counsel title might suggest. He appeared and took a lead role at court conferences, flew to Japan on short notice to take key depositions, cross-examined a key defense expert at the Daubert hearing (Dr. Potenza), and ultimately took the lead in settlement negotiations. Other lawyers from his firm, including Daniel Thornburgh and Stephen Echsner, were actively involved in the work up of experts, discovery issues, and preparation of the Lilly trial pool case for trial. Also, as a Pensacola-based firm, AWKO was responsible for logistics of team meetings and preparations for court appearances.
It is reasonable to conclude that without the active involvement of these three firms, the successful resolution of this litigation would not have been achieved in early 2019.
Lieff Cabraser had the third highest number of hours, although approximately half were spent in document review which, while necessary, is not valued on par with such activities as court appearances, arguing motions, depositions, and case work-up. The most significant contribution from Lieff Cabraser was the work of Lexi Hazam (a member of the PEC and the Science and Expert Sub-committee) in expert development and the Daubert hearing process. Ms. Hazam, along with her colleague Kelly McNabb, was involved with finding and working up key experts and preparing and presenting them at the Daubert hearing, as well as cross-examining a key defense expert, Dr. Weed. Ms. McNabb also played a significant role in third party discovery. I recommend that Lieff Cabraser be awarded 7% of the money available for common benefit fee awards in recognition of the importance of their work to the result achieved.
These two firms were recognized by their peers for consistently being important players in the critical work-up of the Plaintiffs' case through their involvement in discovery issues, motions practice, and case management. Both Behram Parekh of Kirtland & Packard and Marlene Goldenberg of GoldenbergLaw were described as having been active throughout the litigation and as reliable, capable team players.
Kirtland & Packard billed over 3,000 hours, most of which was Mr. Parekh's work. He was the point person for working with the ESI vendor, negotiating the ESI protocol, and all aspects of document discovery, including negotiating with Defendants on all aspects of document production and arguing discovery issues before Judge Rodgers and Magistrate Judge Jones. Mr. Parekh's knowledge of ESI and work with the document platform vendor Catalyst obviated the need to hire a separate vendor or consultant for those issues. He supervised targeted document review that identified documents for use in depositions and preparation of experts and was heavily involved in preparations for, and taking, corporate witness depositions.
The time billed by GoldenbergLaw (approximately 1,500 hours) was almost exclusively Marlene Goldenberg's work. Ms. Goldenberg worked closely with Mr. Parekh on discovery issues, including on supervision of and providing feedback to document reviewers. She also played a significant role in case management — organizing the teams taking and preparing for depositions, scheduling and running calls for document reviewers, and coordinating the process for identifying deposition designations for trial. Additionally, she took depositions of company witnesses and negotiated with Defendants on discovery issues.
In recognition of their contributions to the result achieved, I recommend that each of these two firms be awarded 6% of the common benefit fee.
These firms were acknowledged by their peers as playing helpful, targeted roles in pursuing the Abilify litigation.
Napoli Shkolnik's work fell into two general categories: document review and work on scientific and expert issues. 58% of their time was spent on document review, targeted and non-targeted. As a part of the Science and Expert Sub-Committee, Ms. Liakos was significantly involved in expert development (particularly with regard to Dr. Glenmullen) and Daubert briefing; she also took some significant company depositions.
George Williamson was the primary attorney at the Farr Law Firm working on the Abilify litigation. Mr. Williamson's contribution was primarily in the discovery phase of the litigation; he took depositions and assisted in the preparation for depositions, including by doing and supervising targeted document review. Additionally, he was involved in developing requests for production to the Defendants and ESI search terms.
In recognition of their contributions to the result achieved, I recommend that each of these two firms be awarded 4.75% of the common benefit fee.
These four law firms had relatively small, but valuable roles in moving the litigation forward.
Chris Hellums of Pittman Dutton was an active member of the PFFC. He was deeply involved in the work of reviewing and evaluating submissions of shared costs, formulating methodology for capital contribution assessments, and undertaking budget projections. His work was extremely valuable to both Mr. Sansom and me, including his willingness to follow up with other Plaintiffs' lawyers on various issues that arose. Additionally, Pittman Dutton performed about 900 hours of document review.
Zimmerman Reed's substantive work primarily focused on discovery issues, including motions to compel production of medical records and other key documents, privilege issues involving Defendants' document production, preparation for company witness depositions, and third-party discovery. J. Gordon Rudd, Jr. and James Watts were the attorneys at Zimmerman Reed who did this work. Additionally, the firm did a significant amount of document review work (68% of the firm's total hours), some of which was performed by contract attorneys.
The vast majority (84%) of Levin Papantonio's hours were spent on document review, some of which was done by contract attorneys. Additionally, the firm played a supporting role, assisting with the review of draft briefs and assisting with deposition preparation, including taking some depositions.
Marybeth Putnick of Putnick Law, who did not have a Leadership appointment, was asked by AWKO to assist with scientific issues in the litigation, as she had an advanced degree (Ph.D.) in psychology. Among other things, Ms. Putnick reviewed scientific literature, assisted in expert preparation, assisted in Daubert briefing, assisted in the preparation of cross examination of defense experts, helped develop a model for valuation of gambling losses, and contributed to preparing the Lilly trial pool case for trial. She spent a total of approximately 1,600 hours on this work.
In recognition of their contributions to the result achieved, I recommend that Zimmerman Reed, Levin Papantonio, and Pittman Dutton each be awarded 3% of the common benefit fee and that Putnick Legal be awarded 2% of the common benefit fee.
The remaining six firms (Berger Montague, Meshbesher & Spence, Childers Schlueter, Zonies Law, Frohlich Gordon, and Restaino) had relatively small roles in this litigation for which I concluded some minimal financial award would be appropriate. I recommend that these firms together be awarded a total of 1.14% of the common benefit fee.
For all the reasons set forth herein, I recommend that the Court enter an Order that the following should be paid by the CPA from the Common Benefit Fund:
6 at 2-3, June 6, 2017, ECF No. 383.