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In re National Football League Players' Concussion Injury Litigation

United States District Court, E.D. Pennsylvania

April 5, 2018

National Football League and NFL Properties, LLC, successor-in-interest to NFL Properties, Inc., Defendants. Kevin Turner and Shawn Wooden, on behalf of themselves and others similarly situated, Plaintiffs, THIS DOCUMENT RELATES TO: ALL ACTIONS


          Hon. Anita B. Brody, J.

         Over the past year, the Court has focused on the implementation of the Settlement Agreement. Now that implementation is in progress, it is time to focus on attorneys' fees. There are four key issues for the Court to decide:

(1) the total amount for the common benefit fund;
(2) the allocation of the common benefit fund among Class Counsel;
(3) the amount, if any, to be set aside for attorneys' fees incurred in the implementation of this complex Settlement Agreement and the possible need for future attorneys' fees throughout the 65-year term of the Agreement; and
(4) the reasonableness of the amount of fees to be paid by individual Class Members from their Monetary Awards to individually retained plaintiffs' attorneys (“IRPAs”).

         In this opinion, I will address the first issue, the total amount for the common benefit fund. The fourth issue, relating to IRPA contingent fee agreements will be addressed in another opinion also filed today. The second and third issues relating to allocation and funding for future implementation will be determined at a later date.

         Class Counsel has petitioned the Court for $112.5 million in reasonable costs and attorneys' fees. I will award to Class Counsel the requested amount comprised of $106, 817, 220.62 in attorneys' fees and $5, 682, 779.38 in costs. The attorneys' fee portion of the award amounts to approximately 11% of the total value of the Settlement.

         Class Counsel also has petitioned the Court to holdback 5% of all Monetary Awards to pay for past and future work implementing the Settlement. I currently do not have enough information to predict the amount of compensation Class Counsel will need for implementation. Therefore, as a precaution, I reserve judgment on the holdback request, and the Claims Administrator will continue to holdback 5% of each Award.[1]

         I. BACKGROUND

         This case began as an aggregation of lawsuits brought by former Players against the NFL Parties for head injuries sustained while playing NFL football. On January 31, 2012, the MDL was formed and proceedings were centralized in this Court. The parties spent almost two years briefing complex motions to dismiss and engaging in intense negotiations before a preliminary class action settlement was submitted for approval. On January 14, 2014, the Court denied preliminary approval over concerns as to the adequacy of the proposed $675 million settlement fund in light of uncertainty regarding the magnitude of damages.

         On April 22, 2015, after crucial revisions were made to the Settlement, the Court granted final approval under Federal Rule of Civil Procedure 23(b)(3). The revised Settlement Agreement established an unlimited fund to compensate retired NFL Players, valued then at close to $1 billion. The Agreement also included other benefits to Class Members such as an uncapped Baseline Assessment Program, valued at $75 million, a $10 million Education Fund, and funding for a Claims Administrator to process Monetary Awards.

         The Settlement Agreement also provided for the NFL Parties to pay “Class Counsel's attorneys' fees and reasonable costs, ” without objection, up $112.5 million. Settlement Agreement § 21.1, ECF No. 6481-1 at 77-78. This same provision of the Settlement Agreement allowed Class Counsel to petition the Court for a holdback “up to five percent (5%) of each Monetary Award and Derivative Claimant Award to facilitate the Settlement program and related efforts of Class Counsel.” Id. at 78.

         On April 18, 2016, the Third Circuit approved the Settlement Agreement. Petitions for review by the United States Supreme Court were sought by objectors and denied. On January 6, 2017, the Agreement became final upon the expiration of the time to file a Supreme Court rehearing petition.

         On February 13, 2017, Co-Lead Class Counsel filed a fee petition, on behalf of the entire Class Counsel, seeking the full $112.5 million provided for by the Settlement Agreement for reasonable expenses and attorneys' fees. Fee Petition Mem. 3, ECF No. 7151-1. The petition filed by Co-Lead Class Counsel also seeks the 5% holdback of each Monetary Award to pay for costs and fees associated with implementing the Settlement.[2] In response to Co-Lead Class Counsel's petition, more than 20 objections were filed, with most of the concerns relating to the 5% holdback request. On April 10, 2017, Co-Lead Class Counsel filed an Omnibus Reply to all objections. Omnibus Reply, ECF No. 7464. A request for discovery related to the fee petition was also filed by an objector, and Co-Lead Class Counsel responded.

         The Court appointed Professor William B. Rubenstein of Harvard Law School as an expert witness on attorneys' fees, covering the issues of (1) fees to be paid to individually retained plaintiffs' attorneys (“IRPAs”) and (2) Class Counsel's 5% holdback request. Professor Rubenstein then issued an Expert Report covering those topics. See Expert Report, ECF No. 9526. Interested parties were given the opportunity to respond to the Expert Report. Professor Rubenstein then filed a reply to the interested parties' responses to the Expert Report. Expert Reply, ECF No. 9571. Lastly, several interested parties filed sur-replies to Professor Rubenstein's reply.

         The implementation process has been ongoing for over a year. The Monetary Awards claims process began accepting claims on March 23, 2017, and, as of this date, the Claims Administrator has issued notices of payable Monetary Awards in 369 claims for a total value of over $400 million. See NFL Concussion Settlement Website, (last visited April 4, 2018). With money now flowing to Class Members, it is appropriate for the Court to compensate Class Counsel.


         Federal Rule of Civil Procedure 23(h) states that a “court may award reasonable attorney's fees . . . that are authorized by law or by the parties' agreement.” Thus, “a thorough judicial review of fee applications is required in all class action settlements.” In re General Motors Corp. Pick-Up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d 768, 819 (3d Cir. 1995). The duty to review fee applications “exists independently of any objection.” In re Cendant Corp. PRIDES Litig., 243 F.3d 722, 730 (3d Cir. 2001) (quoting Zucker v. Occidental Petroleum Corp., 192 F.3d 1323, 1328-29 (9th Cir.1999)).

         This Court is obligated to protect the interests of the Class, “acting as a fiduciary for the class.” In re Rite Aid Corp. Sec. Litig., 396 F.3d 294, 307-08 (3d. Cir. 2005) (citing Cendant, 264 F.3d at 231); Report of the Third Circuit Task Force, Court Awarded Attorney's Fees, 108 F.R.D. 237, 251 (1985). The Settlement Agreement is in accord, stating that disbursement of attorneys' expenses and fees is “subject to the approval of the Court.” Settlement Agreement § 21.1, ECF No. 6481-1, at 78. Here, the Parties agreed that the NFL would pay up to $112.5 million in expenses and fees without objection, and Class Counsel has requested that exact amount.

         A. Expenses

         Class Counsel has requested the payment of $5, 682, 779.38 in expenses. Consistent with my fiduciary obligation to review all of Class Counsel's fee requests, I have reviewed the expenses submitted and concluded that they are reasonable. There have been no objections to the expenses requested by Class Counsel. Hence, I will award Class Counsel reimbursement for the expenses submitted.

         B. Attorneys' Fees

         Class Counsel has requested $106, 817, 220.62 in attorneys' fees, which represents approximately 11% of the value of the Settlement Agreement. I will award Class Counsel the requested amount.

         There are two methods for determining the reasonableness of attorneys' fees in class actions cases: (1) percentage-of-recovery and (2) lodestar. The use of each varies based on the type of litigation. “Common fund cases . . . are generally evaluated using a ‘percentage-of-recovery' approach, followed by a lodestar cross-check.” Halley v. Honeywell Int'l, Inc., 861 F.3d 481, 496 (3d Cir. 2017) (citation omitted).

         Where, as here, a defendant has voluntarily undertaken the establishment of a separate fund to pay class counsel's costs and fees, the case is most appropriately reviewed as a common fund case. See, e.g., In re Prudential Ins. Co. Am. Sales Practice Litig. Agent Actions, 148 F.3d 283, 333-34 (3d Cir. 1998); GM Trucks, 55 F.3d at 822. Therefore, I will evaluate the request in this case as a common fund by using the percentage-of-recovery approach with a lodestar crosscheck.

         1. Percentage-of-Recovery

         The award in this case produces a reasonable percentage-of-recovery of 11%. The percentage-of-recovery approach “compares the amount of attorneys' fees sought to the total size of the fund.” Halley, 861 F.3d at 496. To determine if the percentage chosen is reasonable, a court must apply the factors found in Gunter v. Ridgewood Energy Corp., 223 F.3d 190, 195 n.1 (3d Cir. 2000) and Prudential, 148 F.3d at 338-40, which are:

(i) the size of the fund created and the number of persons benefitted;
(ii) the presence or absence of substantial objections by members of the class to the settlement terms and/or fees requested by counsel;
(iii) the skill and efficiency of the attorneys ...

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