Hubbard v. Donahoe

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

BRUCE HUBBARD, et al., )
)
Plaintiffs, )
)
v. ) Civil Case No. 03-1062 (RJL)
)
PATRICK R. DONAHOE, Postmaster )
General, United States Postal Service, )
)
Defendant. )

~~
MEMORANDUM OPINION
(July~, 2013)

This is a Rehabilitation Act class action alleging that the United States Postal

Service ("USPS") failed to provide reasonable accommodations to current and former

deaf and hearing-impaired employees. After a decade of litigation and negotiations, the

parties now seek final approval of a stipulated settlement agreement that would resolve

this action as to the Proposed Settlement Classes. The Court held a fairness hearing

related to the settlement, as required by Federal Rule of Civil Procedure 23(e). The

arguments and representations made on the record during the Fairness Hearing are hereby

expressly incorporated and made part of this Memorandum Opinion. Having considered

the parties' pleadings, the arguments and representations made and the exhibits submitted

at the Fairness Hearing, the relevant statutes and caselaw, and the entire record herein,

the Court grants final approval of the $4.55 million Global Settlement Agreement

("Agreement") and awards class counsel $910,000 in attorneys' fees and $114,216.69 in

expenses from the total value of the settlement.
 BACKGROUND

This class action stems from two related actions brought before the United States

Equal Employment Opportunity Commission ("EEOC"). In late 1998, Bruce Hubbard

requested EEO counseling, alleging that USPS denied him reasonable accommodations at

the USPS Brentwood facility in Washington, D.C. See Third Am. Compl., Oct. 19, 2012

[Dkt #149] ~ 19. After a formal mediation in early 1999, Mr. Hubbard and USPS

reached an agreement in principle that reasonable accommodations would be

forthcoming. See id. Mr. Hubbard filed a subsequent EEO Complaint of Discrimination

on or about February 20, 2001, again alleging that USPS denied him the reasonable

accommodation of a sign language interpreter. !d. ~ 20. The case proceeded in the

EEOC Washington Field Office as EEOC No. 100-A1-8026X, Agency No. 1K-201-

0037-99. !d.~ 21. On September 27, 2002, Mr. Hubbard amended his individual

complaint to assert class allegations with four other plaintiffs, namely Judy M. Schuld,

Grace J. Shirk-Emmons, Lucy I. Stieglitz, and George R. Westenberger (collectively, the

"Hubbard Plaintiffs"). !d. ~ 23.

On May 14, 2003, the Hubbard Plaintiffs filed this class action suit on behalf of

themselves and similarly situated current and former USPS employees, alleging

violations of the Rehabilitation Act of 1973, 29 U.S.C. § 791 et seq. See Compl., May

14, 2003 [Dkt. #1]. They later filed two amended class action complaints specifically

alleging violation of§ 501 of the Act. See First Am. Compl., Aug. 22, 2005 [Dkt. #58];

Second Am. Compl., July 10, 2006 [Dkt. #90]. On October 24, 2011, the Hubbard

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Plaintiffs sought leave to file a Third Amended Complaint to add James Gralund, Daniel

Tighe, Susan Tighe, Diane Whitener, and Arlen Whitsit from Tighe v. Potter, EEOC No.

1E-801-0070-04 (collectively, the "Tighe Plaintiffs"), as well as Gail Walker, as named

plaintiffs. See Pis.' Unopposed Mot., Oct. 24, 2011 [Dkt #140].

After litigating before the EEOC and this Court for approximately nine years, the

Hubbard Plaintiffs and USPS entered settlement discussions under the mediation

program sponsored by this Court in March 2009. See Pis.' Memo in Support of

Unopposed Mot. [Dkt #140] at 5. The parties were unable to reach agreement at that

time. !d. In March 2010, the Hubbard Plaintiffs, together with the Tighe Plaintiffs,

reinitiated settlement discussions with USPS. !d. The parties engaged a private mediator

for a flat success fee of$150,000-$75,000 to be paid by the Department of Justice

("DOJ") and $75,000 to be paid by Covington & Burling LLP ("Covington"). See Decl.

of Kenneth R. Feinberg [Dkt. # 154] ~ 5. At the close of the mediation session in late

2010, the parties reached an agreement in principle, the terms of which the parties

subsequently incorporated into the proposed Agreement. See Pis.' Memo in Support of

Unopposed Mot. at 5.

In late 2011, plaintiffs filed an unopposed motion for preliminary approval of the

proposed settlement. On October 19, 2012, the Court (1) granted plaintiffs' Motion for

Leave to File a Third Amended Complaint, (2) certified the Proposed Settlement Classes,

(3) appointed Class Representatives and Class Counsel, (4) granted preliminary approval

of the Agreement, except for the proposed attorneys' fees and costs, (5) approved the

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Class Notice, and (6) approved a schedule for the final settlement approval process. See

Order, Oct. 19, 2012 [Dkt. #148]. Notices were subsequently mailed to over 6,000

potential class members.

Pursuant to Federal Rule of Civil Procedure 23(e), the Court held a fairness

hearing to consider objections to the Agreement and whether to grant final approval. Due

notice of the hearing was provided to all potential class members, and all entities that

made timely objections were given an opportunity to present such objections to the Court

and to be heard at the Fairness Hearing held on January 30, 2013. Two additional

hearing days (February 15 and March 1, 2013) were devoted to objections to the

injunctive and monetary relief proposed in the Agreement. A fourth hearing day, May 7,

2013, was devoted to the proposed attorneys' fees and costs.

LEGAL STANDARD

Pursuant to Federal Rule of Civil Procedure 23(e), final approval of the proposed

settlement agreement lies within this Court's discretion. See Vista Healthplan v. Warner

Holdings Co. III, 246 F.R.D. 349, 357 (D.D.C. 2007). "In considering whether to

approve a proposed class action settlement, the Court must strike a balance between a

rubber stamp approval and 'the detailed and thorough investigation that it would

undertake if it were actually trying the case."' !d. (quoting United States v. District of

Columbia, 933 F. Supp. 42,47 (D.D.C. 1996)). The Court's role is to act as a fiduciary

for class members and determine whether the proposed settlement is "fair, reasonable,

and adequate." FED. R. CIV. P. 23(e)(2). Courts in our Circuit have considered the

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following factors in making this determination: "(1) whether the settlement is the result

of arm's-length negotiations; (2) the terms of the settlement in relation to the strength of

Plaintiffs' case; (3) the stage of the litigation proceedings at the time of settlement; (4)

the reaction of the class; and (5) the opinion of experienced counsel." Vista Healthplan,

246 F.R.D. at 360; see also In re Lorazepam & Clorazepate Antitrust Litig., No. MDL

1290 (TFH), 2003 WL 22037741, *2 (D.D.C. June 16, 2003) ("Lorazepam Iff') (citing

numerous cases).

While Rule 23 (e) does not expressly address judicial oversight of fee accords, "the

[district court's] approval function has routinely been extended to embrace fees ... where

... there is an inherent tension between the interests of the class and the interests of the

lawyers." See Weinberger v. Great N Nekoosa Corp., 925 F.2d 518, 523 (1st Cir. 1991);

Piambino v. Bailey, 610 F.2d 1306, 1328 (5th Cir. 1980) (to minimize conflict between

attorney and class, district court "must address the issue of attorneys' fees" before

approving class action settlement). "The presence of an arms' length negotiated

agreement among the parties weighs strongly in favor of approval, but such an agreement

is not binding on the court." Jones v. Amalgamated Warbasse Houses, Inc., 721 F.2d

881, 884 (2d Cir. 1983) (upholding district court's downward revision of fee settlement

in class action civil rights suit submitted to court for Rule 23( e) approval). "The court's

role as the guarantor of fairness obligates it not to accept uncritically what lawyers self-

servingly suggest is reasonable compensation for their services." Weinberger, 925 F .2d

at 525.

5
 ANALYSIS

I. Class Certification

As a preliminary matter, the Court will certify the Proposed Settlement Classes

based on its finding that the classes satisfy the prerequisites ofF ederal Rule of Civil

Procedure 23(a) with respect to numerosity, commonality, typicality, and adequacy, as

well as the prerequisites of23(b)(2) and (b)(3). The Damages Settlement Class is

certified as a Rule 23(b)(3) opt-out class comprised as stated in the Court's October 19,

2012 Order. The Injunctive Settlement Class is certified as a Rule 23(b)(2) non-opt-out

class comprised as stated in the same order.

"A settlement class certification must comply with all four prerequisites of Rule

23(a) and one of the three subsections of Rule 23(b)." In re Lorazepam & Clorazepate

Antitrust Litig., 205 F.R.D. 369, 387 (D.D.C. 2002) ("Lorazepam If'). Here, the

numerosity requirement under 23(a)(1) is easily satisfied for both classes by the

undisputed fact that USPS employed over 6,000 deaf or hearing-impaired individuals

between November 14, 2001 and the present, and joinder of all members would be

impracticable. The commonality requirement under 23(a)(2) is satisfied for both classes

because the claims are based on the common contention that USPS has failed to provide

reasonable accommodations to deaf and hearing-impaired employees from November 14,

200 1 to the present. The resolution of this issue will affect all of the members of the

classes. See In re Lorazepam & Clorazepate Antitrust Litig., 202 F.R.D. 12, 26 (D.D.C.

2001) ("Lorazepam f'). The typicality requirement under 23(a)(3) is satisfied here

6
because the claims of the Class Representatives are based on the same course of conduct

giving rise to the claims of the Proposed Settlement Classes. See Bynum v. District of

Columbia, 214 F.R.D. 27, 35 (D.D.C. 2003). The adequacy requirement under 23(a)(4)

is satisfied here because the Class Representatives and Class Counsel adequately

represented the absent class members and there is no conflict between the interests of the

Class Representatives and the Proposed Settlement Classes.

As noted above, plaintiffs seek to certify the Damages Settlement Class under

Rule 23(b)(3) and the Injunctive Settlement Class under Rule 23(b)(2). The Court

concludes that certification ofthe Damages Settlement Class under 23(b)(3) is

appropriate. The predominance requirement under 23(b)(3) is satisfied because the

predominant issue in the case-the question ofUSPS' denial of accommodations in

violation of the Rehabilitation Act-"pertain[s] to each member of the class." See

Radosti v. Envision EM!, L.L.C., 717 F. Supp. 2d 37, 53 (D.D.C. 2010) ("Radosti F').

The superiority requirement under 23(b)(3) is also met here because the small individual

stakes involved make the class action a superior mechanism to effect a nationwide

change in USPS policies and "ensure[] that class members will receive equal treatment."

See id. Certification of the Injunctive Settlement Class is appropriate under Rule 23(b)(2)

because the injunctive and declaratory relief in the Agreement "is appropriate respecting

the class as a whole," FED. R. CIV. P. 23(b)(2), to address the class-based discrimination

alleged by plaintiffs, see Amchem Products, Inc. v. Windsor, 521 U.S. 591, 614 (1997).

7
 II. Reasonableness of the Settlement

Having found that the classes should be certified, the Court now turns to consider

the reasonableness of the settlement to determine if it should be approved. For the

reasons explained below, the Court considers the separate funds for class recovery and

attorneys' fees collectively as a "constructive common fund," valued at $4,550,000. The

Court awards 20% ofthis fund, or $910,000, to Class Counsel as attorneys' fees. The

Court also awards $114,216.69 in expenses to Class Counsel. This leaves $3,525,783.31

in monetary relief for distribution to the Class Representatives, class members, and

claims administration costs.

The Court finds this recovery to be fair, adequate, and reasonable under Federal

Rule of Civil Procedure 23(e) and the factors set forth in Vista Healthplan. The

settlement was reached in arm's length negotiations undertaken in good faith between

experienced counsel after extensive discovery, factual investigation, and legal analysis.

There is no evidence of unfairness or collusion that would preclude final approval. Class

counsel had more than "sufficient information, through adequate discovery, to reasonably

assess the risks of litigation vis-a-vis the probability of success and range of recovery."

See Lorazepam III, 2003 WL 22037741, at *4. These factors weigh in favor of approval.

a. The Injunctive Relief and Compensatory Damages Are Fair, Reasonable,
and Adequate
The Agreement provides for injunctive relief, including state-of-the-art technology

and improved management structures designed to enable all deaf and hearing-impaired

USPS employees to fully and safely participate in the workplace. See Pls.' Memo in

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Support of Unopposed Mot. at 5-9. The Agreement requires USPS to make available

American Sign Language ("ASL") interpreting services for important workplace

communications including hiring, promotion, discipline, and safety discussions. ld. at 6.

USPS will train supervisors on the new requirements and technology. ld. at 7. It will

also create various internal management structures to monitor the provision of reasonable

accommodations. ld. at 8-9. An independent ombudsman will also monitor compliance

and enforcement of the Agreement. Id. at 9.

The Agreement also provides monetary relief to compensate eligible damages

class members. Each Class Representative is entitled to a baseline award of $10,000 for

his or her work on behalf of the class, and each eligible damages class member is entitled

to a baseline award of $250. See Jt. Memorandum Providing Factual and Legal Support

for Preliminary Approval of Global Settlement Agreement ("Jt. Memo") [Dkt. # 142-1] at

5. All remaining funds (less claims administration costs) will be allocated to eligible

class members based on the severity of the harm they allegedly suffered as a result of

USPS' failure to provide reasonable accommodations. Id. at 6. The parties estimated

that half of the approximately 6,000 eligible class members will submit a claim, and the

average award will be $927. !d. at 7. The Court notes that this estimate is less than

damages awards in EEOC actions, discrimination suits, and settlements based on similar

allegations. See id. at 8-10. However, the Court's order today makes over $500,000

previously earmarked by the parties for attorneys' fees and expenses available for

distribution to the class members. In addition, continued litigation in this case would

9
entail substantial costs and risks given USPS' continued denial of liability. On balance,

the Court concludes that a total recovery for the class of$3,525,783.31 (less claims

administration costs) is fair, adequate, and reasonable.

The Court also finds reasonable the $110,000 in claims administration costs

provided for in the Agreement. First, these costs arose from a good-faith, competitive

negotiation process. The parties considered proposals from two different claims

administration firms and ultimately negotiated an absolute cap on administration costs of

$110,000 with one ofthem. !d. at 25-26. Second, this figure is consistent with the costs

in other class action settlements approved by our Circuit. !d. at 26. Third, these costs are

fair, adequate, and reasonable given the unique communication needs of the class. !d.

Under Rule 23, "the court must direct to class members the best notice that is

practicable under the circumstances, including individual notice to all members who can

be identified through reasonable effort." FED. R. Crv. P. 23(c)(2)(B). In this case, the

Class Notice was nationally disseminated to over 6,000 eligible damages class members

(current and former hearing-impaired individuals who were USPS employees at some

point after November 14, 2001) in November 2012. The Notice-which was provided in

both sign language and writing-advised the members of the Proposed Settlement

Classes of the essential terms of the Agreement, the plan for allocating funds, how to

make a claim, and how to object to the settlement. See Pis.' Memo in Support of

Unopposed Mot. at 19. The Classes were also notified regarding the date, time, and place

of the Fairness Hearing. !d. Having carefully examined the Notice and distribution

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procedures outlined in Section 7.1 of the Agreement, the Court has no difficulty finding

that the Notice was adequate.

The Court finds that the class members' reaction to this settlement has been

positive and supports approval. Prior to the Fairness Hearing held on January 30, 2013,

the Claims Administrator received 1,296 claim forms, 1 eleven requests for exclusion

from the settlement, and nine submissions from class members? See Jt. Response to

Class Member Submissions Received to Date, Jan. 25, 2013 [Dkt. #152]. Compared to

6,000 notices disseminated to potential class members, "[t]he low number of opt outs and

objectors (or purported objectors) supports the conclusion that the terms of the settlement

were viewed favorably by the overwhelming majority of class members." See Bynum v.

District of Columbia, 412 F. Supp. 2d. 73, 77 (D.D.C. 2006). In addition to reviewing

these written submissions, the Court heard from five potential class members at the

Fairness Hearing on January 30, 2013, namely: Timothy Ryan, Joseph Ortiz, Brian Bush,

Marie Ryan, and Rastan Yazdani. Mr. and Mrs. Ryan, Mr. Ortiz, and Mr. Bush also

appeared and spoke at the Fairness Hearing on February 15, 2013.

The Court overrules the objection submitted by Brian Bush. In his written

submission, Mr. Bush challenged the $10,000 compensation for the Class

Representatives. I conclude, however, that the Class Representatives are entitled to

1 As of April25, 2013, the Claims Administrator had received 1,495 claim forms, which
represents 24% ofthe 6,159 class members. See Ex. A to Pis.' Supp. Br. [Dkt. #165-1].
2 The Court received nine submissions from Jennifer Burks, Brian Bush, James Doolittle,

Omar Chung, George Ciobanu, Arthur Gerada, Joseph Ortiz, Marie Ryan, and Timothy
Ryan. The Court construes the submissions of Mr. Doolittle and Mr. Ortiz as requests to
opt-out of the settlement pursuant to section 6.1.3 of the Agreement.

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$10,000 each "for the services they provided and the risks they incurred during the course

of the class action litigation." Radosti v. Envision EML L.L.C., 760 F. Supp. 2d 73, 79

(D.D.C. 2011) ("Radosti IF'). The eleven Class Representatives in this action spent hours

working on behalf of absent class members and made valuable contributions to both

classes. In addition, the amount of this award is reasonable compared to awards in other

cases.

The Court also overrules the purported objections of Marie Ryan, Timothy Ryan,

Jennifer Burks, Omar Chung, George Ciobanu, and Arthur Gerada. In their written

submissions, Mr. and Mrs. Ryan expressed concerns about the provision of interpreter

services during significant workplace events and problems with the Video Remote

Interpreting technology. They also spoke about these concerns at the Fairness Hearing.

While they did not appear at the Fairness Hearing, Jennifer Burks, Omar Chung, George

Ciobanu, and Arthur Gerada expressed in writing similar concerns and frustration about

past discrimination. The Court is confident that these concerns will be addressed when

USPS implements the remedial aspects of the Agreement. In addition, the individuals

who expressed frustration about past discrimination will be eligible for monetary awards

under the Agreement.

Having scrutinized the terms of the Agreement, all papers filed in connection

therewith, and the oral presentations of counsel and objectors at the Fairness Hearing, I

find the injunctive and monetary relief to be in the best interests of the class and to be

fair, reasonable, and adequate under Federal Rule of Civil Procedure 23(e).

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 b. Attorneys' Fees and Expenses

As part of the Agreement, the parties negotiated a lump sum payment by USPS of

$1,550,000 for fees and expenses to be allocated among Class Counsel. This amount was

comprised of $1,360,783.31 in attorneys' fees and $189,216.69 in expenses. See Jt.

Memo at 14. The $1,360,783.31 attorneys' fee component was comprised of

$971,110.48 for Covington, $125,000 for the Washington Lawyer's Committee

("WLC"), $124,672.83 for a Maryland law firm-McCollum & Associates LLC

("McCollum"), and $140,000 for a Denver law firm-the Law Offices of Kevin C.

Flesch LLP ("Flesch"). !d. at 15. The $189,216.69 expenses component was composed

of$188,889.52 for Covington and $327.17 for McCollum. !d.

i. Attorneys' Fees

"When awarding attorneys' fees, federal courts have a duty to ensure that claims

for attorneys' fees are reasonable." Swedish Hosp. Corp. v. Shalala, 1 F.3d 1261, 1265

(D.C. Cir. 1993). Courts generally use two methods to assess the reasonableness of

attorneys' fees: the lodestar method and the percentage of recovery method. See In re

Vitamins Antitrust Litig., Misc. Action No. 99-197 (TFH), 2001 WL 34312839, at *2-*3

(D.D.C. July 16, 2001) ("Vitamins"). The lodestar method is typically utilized in the

statutory fee shifting framework, whereas the percentage of recovery method is employed

where the efforts of counsel have generated a common fund. See id. "[T]his Circuit

requires the percentage of recovery method in common fund cases." !d. at *2.

Under the lodestar method, the district court must start by determining the amount

13
of time reasonably expended by class counsel, and compensate that time at appropriate

hourly rates based on the geographic region and the attorneys' experience level. See

Miller v. Holzman, 575 F. Supp. 2d 2, 11-12 (D.D.C. 2008), vacated in part on separate

grounds by United States ex ref. Miller v. Bill Harbert Int'l Const., Inc., 608 F.3d 871

(D.C. Cir. 2010). The product of reasonable hours times a reasonable rate-the "lodestar

figure"-is presumed to be the reasonable fee to which counsel is entitled. !d. at 11.

Courts in our Circuit have reduced the lodestar, however, in cases where counsel's

calculations are based on ambiguous time entries, block billing, and inefficient staffing.

See, e.g., Miller, 575 F. Supp. 2d at 44.

Our Circuit has joined the Third and Eleventh Circuits, among others, in

concluding that the percentage of recovery method is superior to the lodestar method for

determining attorneys' fee awards in common fund cases. See Swedish Hosp., 1 F.3d at

1271. The common fund doctrine is based on the equitable notion that "a litigant or a

lawyer who recovers a common fund for the benefit of persons other than himself or his

client is entitled to a reasonable attorney's fee from the fund as a whole." Boeing Co. v.

Van Gernert, 444 U.S. 472, 478 (1980). As our Circuit has explained, "[s]pecial

problems exist in assessing the reasonableness of fees in [common fund cases] since class

members with low individual stakes in the outcome often do not file objections, and the

defendant who contributed [to] the fund will usually have no interest in how the fund is

divided between the plaintiffs and class counsel." Swedish Hosp., 1 F.3d at 1265. By

contrast, "statutory fee cases involve the plaintiff (not his attorney) as claimant and

continue to be adversary proceedings." See Skelton v. General Motors, 860 F .2d 250,

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253 (7th Cir. 1989). In the common fund context, the percentage of recovery method

does a better job of guarding against potential abuses than the lodestar method. See

Swedish Hasp., 1 F.3d at 1269 ("[I]fwe apply the lodestar method to the common fund

case, then the attorney inefficiently expending an excess amount of time does stand to

gain by that inefficiency if the awarding court does not ultimately recognize the

inefficiency in the far-from-exact testing of the fee award hearing."); Court Awarded

Attorney Fees, Report of the Third Circuit Task Force, 108 F.R.D. 237, 246-49 (1986)

(noting that the lodestar method incentivizes attorney inefficiency and disincentivizes

early settlement in common fund cases). In addition, the percentage of recovery method

is "more efficient, easier to administer, and more closely reflects the marketplace." See

Swedish Hasp., 1 F.3d at 1270.

This, of course, is not a classic common fund case. Class counsel and DOJ, on

behalf of USPS, negotiated a separate fee accord to be paid by USPS. For all practical

purposes, however, the attorneys' fees and class recovery in this case come from the

same source-USPS revenues. See Jt. Memo at 4. Here, USPS, "unlike the loser in a

fee-shifting case, stands to lose no more if the attorneys' fee award is greater and

therefore cannot be relied upon to provide an adversarial approach to deleting

unreasonable time entries." See Swedish Hasp., 1 F.3d at 1269. In order to guard against

potential abuses and ensure fairness to the class members in this situation, other judges

on this Court "ha[ve] previously considered similar settlement agreements as constructive

common funds and awarded fees on a percentage basis." See Radosti II, 760 F. Supp. 2d

at 77 (Kollar-Kotelly, J.); Vista Healthplan, 246 F.R.D. at 364 (Kollar-Kotelly, J.); Cohen

15
v. Chilcott, 522 F. Supp. 2d 105, 122 (D.D.C. 2007) (Kollar-Kotelly, J.); Vitamins, 2001

WL 34312839, at *6 (Hogan, C.J.). Accordingly, this Court will similarly consider this

settlement to be a constructive common fund of $4,550,000, and the Court will apply the

percentage of recovery method to determine an appropriate fee award.

Class Counsel here seeks an award of$1,360,783.31 in fees, which amounts to

just under 30% of the constructive common fund. See Jt. Memo at 22. In the absence of

any definitive test in our Circuit for determining the appropriate percentage under the

percentage of recovery method, my colleague, Judge Thomas F. Hogan, adopted and

applied the following factors from the Third Circuit:

(1) the size of the fund created and the number of persons benefitted; (2)
the presence or absence of substantial objections by members of the class to
the settlement terms and/or fees requested by counsel; (3) the skill and
efficiency ofthe attorneys involved; (4) the complexity and duration ofthe
litigation; (5) the risk of nonpayment; (6) the amount oftime devoted to the
case by plaintiffs' counsel; and (7) the awards in similar cases.

Lorazepam III, 2003 WL 22037741, at *8 (quotations and citations omitted). In applying

these factors here, the most significant are the efficiency of the attorneys involved, the

complexity of the litigation, the risk of nonpayment, and the size of the fund. While the

Court recognizes, and appreciates, that Class Counsel worked for over 10 years before

reaching an agreement that provides a reasonable and adequate recovery to the class

members, I am quite concerned that more than two dozen lawyers at three law firms and

a public interest organization billed over 9,000 hours to this case. See Jt. Memo at 14. I

am even more concerned that many of the billing records submitted to the Court contain

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vague work descriptions from which the Court cannot ascertain the reasonableness of the

time claimed. Eleven attorneys at one firm alone-Covington-billed over 6,500 hours.

See Decl. of Thomas S. Williamson, Jr. [Dkt. #165-1] ~~ 4, 11. On balance, the Court

finds that Class Counsel, particularly those at Covington, could have performed their

duties much more efficiently, with leaner staffing and better team management and

coordination. Indeed, this is a classic example of a case where "too many attorneys [from

too many firms] were assigned to discrete tasks," including multiple depositions where

three or more attorneys billed time. See Miller, 575 F. Supp. 2d at 40-41. Moreover, the

9,000 hours spent litigating this matter were, to say the least, excessively disproportionate

to the legal complexity of the case. Only fifteen depositions (thirteen fact witnesses and

one expert witness twice) were defended or taken by Class Counsel, and USPS filed only

two dispositive motions. See Ex. 7 to Decl. of Thomas S. Williamson, Jr. [Dkt. #165-1].

Furthermore, during the six years that this case was actively litigated, there were only a

handful of brief hearings in the District Court and another handful before the Magistrate

Judge assisting the Court with discovery issues. "[T]he obvious lack of any market

restraints on the amount of time spent causes the Court to be highly skeptical of counsel's

claim that the number of hours is reasonable." See In re LivingSocial Mktg. & Sales

Practice Litig., 2013 WL 1181489, at *19 (D.D.C. Mar. 22, 2013). As to the risk of

nonpayment factor, while the two smaller law firms that assisted Covington in the

handling of this case did so on a contingency basis, Covington handled it on a purely pro

bono basis and has assured the Court that it will donate all of the fees it recovers (less

out-of-pocket expenses) to either public interest or legal services organizations. See

17
Decl. Thomas S. Williamson, Jr.~ 3. Finally, the minimum guaranteed and estimated

average monetary awards in this case fall short of those in other settlements based on

similar allegations. See Jt. Memo at 10. In sum, this is a relatively small common fund

from which to award nearly 30% to attorneys' fees. In Bates v. United States Parcel

Service, Case No. C 99-2216 TEH (N.D. Cal.), for example, "[c]lass members who did

not participate in the litigation were due a minimum of $500-as compared to $250 in

this case." See Jt. Memo at 10.

Accordingly, I have concluded that the Lorazepram III factors weigh in favor of a

more modest percentage award of20% of the $4.55 million common fund, or $910,000,

to Class Counsel for attorneys' fees. This percentage falls comfortably within the range

of fifteen to forty-five percent that has been established in other cases in our Circuit, and

it is a more reasonable and fair award than that proposed by Class Counsel. See

Vitamins, 2001 WL 34312839, at *10; see also Swedish Hasp., 1 F.3d at 1272 ("[A]

majority of common fund class action fee awards fall between twenty and thirty

percent.").

ii. Expenses

"In addition to being entitled to reasonable attorneys' fees, class counsel in

common fund cases are also entitled to reasonable litigation expenses from that fund."

Lorazepam III, 2003 WL 2203 77 41, at * 10 (quotations and citations omitted). Here,

Class Counsel seeks reimbursement for $189,216.69 in expenses incurred during the

litigation. See Jt. Memo at 14. This amount is comprised of $188,889.52 in expenses

18
incurred by Covington and $327.17 in expenses incurred by McCollum. !d. at 15.

Part of the expenses sought here is Covington's half of the $150,000 flat success

fee that Covington and DOJ committed to pay Ken Feinberg's law firm for its mediation

services in the event that a final settlement were reached and approved by this Court.

Such a fee might be appropriate, of course, in a highly complex case between two (or at

least one) highly financed corporations, where there is a very large common fund for the

settlement. It is not, however, appropriate in a much less complex case against a

financially strapped organization like USPS, where there is a very modest common fund.

Indeed, counsel for DOJ and Covington acknowledged during the Court's hearing on this

issue that they made very limited to no efforts to find a more cost-effective mediation

arrangement after the Court's pro bono mediator was not successful. Thus, while Mr.

Feinberg may well be regarded as the gold standard in resolving highly complex matters

involving very large pools of money (see, e.g., BP Oil Spill Fund, September 11th Victim

Compensation Fund, Bowling v. Pfizer Heart Valve Settlement) his flat fee demand in

this case strikes this Court as unreasonable under these circumstances. Accordingly, the

Court will not approve the $75,000 portion of his fee that Covington seeks as expenses.

If Covington, however, wishes to pay Mr. Feinberg from its portion ofthe attorneys' fees

the Court has awarded Class Counsel, that is a matter between Covington and Mr.

Feinberg. In the meantime, the $75,000 Covington seeks will remain in the common

fund for distribution to the class members.

Otherwise, the Court is satisfied that Class Counsel reasonably expended the

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remaining fees claimed in the course of their work on behalf of the classes. To date, no

class members have objected to the award of expenses, and the award is not opposed by

USPS. Accordingly, the Court will award the remaining $114,216.69 in expenses to

Class Counsel.

CONCLUSION

For all of the foregoing reasons, the Court grants final approval of the Agreement

under Federal Rule of Civil Procedure 23(e). An Order consistent with this decision

accompanies this Memorandum Opinion.

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