The opinion of the court was delivered by: RAMBO
On September 9, 1981 this court entered final judgment in the Three Mile Island (TMI) class action for economic losses attributable to the 1979 nuclear accident at Reactor Number 2. The judgment resulted from a settlement agreement between the defendants, various companies which owned, operated, designed, constructed and maintained TMI, and plaintiffs' executive committee, a group of ten law firms appointed by the court to coordinate the prosecution of the many cases filed in this court following the nuclear incident. Before approval of the settlement plaintiffs' counsel involved in the case filed their requests for awards of counsel fees and reimbursement of costs related to the litigation. The court has carefully reviewed each petition and will award fees and expenses in accordance with the standards expressed after the background statement below.
Plaintiffs began filing lawsuits in this court within days of the nuclear accident at TMI which began on March 28, 1979. Some were individual suits, others were pleaded as class actions. These suits sought compensatory, punitive and injunctive relief. On May 25, 1979 the first pretrial conference was held by United States Magistrate John Havas. He ably directed the organization of the cases during the initial stage of the litigation. A degree of order was finally achieved when most of the TMI cases were joined into one class action to proceed under a consolidated complaint. In September 1979 the parties agreed to class treatment of Classes I and II, composed respectively of businesses and individuals seeking damages for economic losses. Whether a class should be certified to represent Class III, those claiming physical injuries as a result of the accident, remained a contested issue. Magistrate Havas conducted an evidentiary hearing on the personal injury class question. Plaintiffs and defendants filed legal memorandums to support their positions regarding certification of this class. During the same period the court requested written briefing on the question of federal subject matter jurisdiction over the lawsuit.
The court filed its opinion on class certification and jurisdiction on July 10, 1980. In essence, the parties' stipulation with respect to Classes I and II was approved by the court. The court affirmed the Magistrate's recommendation to deny class treatment generally to Class III, but to grant class treatment on the issue of entitlement to medical detection services.
During 1979 and 1980 plaintiffs organized and began their development of the factual record needed for trial. The highly technical nature of the nuclear industry and the need to explore the long term health effects of the incident necessitated the hiring of experts for consultation. In tandem with trial preparation, settlement negotiations were also undertaken. Once the class status was determined, the parties and the court devoted time to the design of legal notice to be sent to the class members and the development of claim forms for those expressing a desire to participate in the lawsuit. There were several meetings with the court to discuss both notice and the progress of settlement negotiations. After nearly a year of negotiation, a proposed settlement was signed on February 17, 1981. The parties began a redraft of the class notice to describe the proposed settlement. Six hundred thousand notices informing class members of the lawsuit and proposed settlement were mailed in May of 1981.
In the period prior to a court hearing on the proposed settlement, plaintiffs' executive committee continued to function. Though trial preparation was no longer necessary, the parties had to hire and prepare witnesses for the court hearing in August. The hearing was to determine whether the court should approve the settlement.
Under the terms of the settlement a twenty-five million dollar fund was established. Twenty million dollars of the fund are available to pay claims from members of Classes I and II. The remaining five million dollars were set aside for a Public Health Fund. The purpose of the fund is to finance studies of the long term health effects of the TMI incident and to further evacuation planning for the future.
The Court of Appeals for the Third Circuit has been a leader in the development of the law governing federal court awards of attorneys fees. In Lindy Brothers Builders v. American Radiator and Standard Sanitary Corporation, 487 F.2d 161 (3d Cir. 1973) (Lindy I), it described these four steps which the district court should follow in computing attorneys fees:
1) A determination of the number of hours spent by each attorney and the manner in which they were spent;
2) An evaluation of the reasonable hourly rate for each lawyer's time;
3) A determination of the contingent nature of the success ...