The settlement fund and the retirees will not pay any attorney fees to Betty Johnson’s counsels, and any such fees will not reduce the retirees’ benefits, according to Johnson counsel Margery Bronster of the Honolulu-based Bronster Hoshibata law firm.
Responding to public comments about Johnson’s counsels’ attorneys’ fees and costs of some $37 million, Bronster stressed in an email to the media that attorney fees will not be paid out of the settlement fund and will not be paid by the NMI Retirement Fund.
Bronster explained that the settlement agreement requires the government to pay the fees as decided by the U.S. District Court for the NMI.
On Tuesday, Bronster Hoshibata asked the court to approve its attorneys’ fees and costs totaling $17.5 million.
Also on Tuesday, attorney Bruce Jorgensen, Johnson’s first and current counsel, also asked for approval of his costs in the amount of $4,643.17. He was not specific on his attorney’s fees but a Saipan Tribune computation with the help of a lawyer showed he was asking for either $18.6 million, $29.6 million, or $38.9 million.
Johnson’s local counsel, attorney Stephen C. Woodruff, submitted Wednesday a petition for approval of his attorney’s fees totaling $1,012,500.
On Wednesday, Sen. Pete Reyes (Ind-Saipan) and Senate Vice President Victor Hocog (R-Rota) urged retirees to opt out of the tentatively approved Fund settlement agreement, describing Johnson’s lawyers as “sharks,” “bloodsuckers,” “vampires,” and “ambulance chasers.”
But Bronster said the court’s decision on fees is separate from the court’s decision on the settlement agreement. She said the court can and should approve the settlement without approving the fees requested in their petitions.
Third, Bronster said, if the settlement fails, it means refunds to active employees will stop, and the Fund will run out of money as soon as June 2014.
“It also means costly litigation will continue,” she said.
Unlike the fees requested in Johnson counsels’ petitions, the lawyer said, the fees incurred by the Fund in continuing litigation will come out of the Fund because the government has so far refused to pay them.
“The most important thing is to make sure the settlement does not fail so the retirees will continue to get benefits without interruption,” she said.
Bronster emphasized that their law firm is not demanding its requested fees as a condition of the settlement.
She said their law firm is hoping that class members do not opt out because if too many do, the settlement will fail.
Bronster hope the settlement will go forward regardless of what happens to its fees “because a failure of the settlement would be bad for all retirees and the entire CNMI.”
Finally, the lawyer said, their law firm hoped the question of its fees could have been resolved by negotiations, but unfortunately an agreement could not be reached before the deadline to file the petitions for fees.
The petitions, Bronster said, outlined the legal standards for fees in class actions settlements and requested fees based on those standards.
“But Bronster Hoshibata is still hopeful that the government will continue to negotiate to resolve the fees,” she said.
She said the court will have the final say and will determine the fees if no agreement can be reached.
“The fee petitions were simply the first step in the process of putting the issue to the court in case it cannot be resolved by agreement,” she said.
The hearing on the attorneys’ fees and costs will be held on Sept. 30, 2013, which is also the date for the final approval of the settlement agreement.