The Honolulu-based law firm Bronster Hoshibata, one of the counsels for Betty Johnson, asked the federal court yesterday for attorneys’ fees and costs totaling $17.5 million.
Attorney Bruce Jorgensen, Johnson’s first and ongoing counsel, also requested for approval of his costs in the amount of $4,643.17. Jorgensen was not very specific on his attorney’s fees, but Saipan Tribune’s computation with the help of a lawyer showed that he was asking for either $18.6 million, $29.6 million, or $38.9 million.
Attorney Stephen C. Woodruff, Johnson’s local counsel, has yet to file his petition for costs and attorney’s fees.
Attorneys Margery S. Bronster and Robert M. Hatch of the Bronster Hoshibata law firm asked the U.S. District Court for the NMI to direct the CNMI government to pay them $5 million upon final approval of the settlement agreement; $5 million at the start of fiscal year 2015; and $2.5 million at the start of fiscal years 2016, 2017, and 2018. This would bring their attorneys’ fees to a total of $17.5 million.
While Jorgensen was clear about his costs that he wants paid ($4,643.17), his request for attorney’s fees was more ambiguous. He requested compensation for 3,825.9 hours of professional services at a rate of $325 per hour, in a cumulative base amount of $1,243,417.50, with application of a lodestar analysis with a multiplier of 15.
If $1.2 million is multiplied by 15, the total amount is $18,651,262.
As an alternative, Jorgensen asked for an award of attorney fees for 3,825.9 hours of professional services, “with application of a percentage-of-fund analysis, based on a percentage amount of 5 percent of the benefit conferred upon the class.” He did not specify the total amount.
A lawyer who requested not to be identified said that Jorgensen was not clear about the amount in the “benefit conferred upon the class.”
The lawyer, who assisted Saipan Tribune, said that Jorgensen was not specific whether the “benefit conferred” refers to $591,219,229 that the Bronster law firm indicated in its application or the $779 million indicated as a default judgment whenever the CNMI government fails to pay its obligations under the settlement agreement.
Five percent of $591,219,229 is $29,560,961.45, while 5 percent of $779 million is $38,950,000.
Under the settlement agreement, the CNMI government agreed to pay Johnson’s attorneys’ fees and costs, and a $7,500 service award for bringing the lawsuit on behalf of other class members.
U.S. District Court for the NMI designated judge Frances Tydingco-Gatewood preliminarily approved on Aug. 6 the settlement agreement in Johnson’s class action against the NMI Retirement Fund and the CNMI government.
A hearing on Johnson’s motion for final approval of the settlement agreement will be held on Sept. 30, 2013. The hearing on her petition for approval of attorneys’ fees and costs will be on that same day.
In Bronster Hoshibata’s petition, Hatch stated that the value of the benefit obtained for the class by the settlement is at least $591,219,229.
Under a percentage-of-the-fund approach, Hatch said that 5 percent of this amount is $29,560,961.45.
“Given that 25 percent is the benchmark for percentage-of-the-fund awards, this would be well below a reasonable fee for all class counsel,” the lawyer said.
He said that if the court were to determine that Bronster’s contribution to the benefit provided to the class were only half of this already very low percentage, it would still be $14,780,480.70.
In the alternative, Hatch said, Bronster’s lodestar is $1,002,678.13 plus $50,861.06 in out-of-pocket costs.
“Given the enormous risk undertaken in this case and the excellent results for the class, Bronster believes that a multiplier of 15 is very reasonable. Under the lodestar analysis, this yields a reasonable fee for Bronster of $15,091,033.01,” Hatch said.
Instead of being paid either of these amounts, however, Hatch said that Bronster believes that the current fiscal condition of the CNMI makes a payment over time more feasible.
Consequently, Hatch said, Bronster requests that the court order the CNMI government to pay Bronster $5 million upon final approval; $5 million at the start of fiscal year 2015; and $2.5 million at the start of the next three fiscal years.