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Weekly Wrap Up 11/18/2011

A collection of legal fee articles from the past week…

Are Attorneys’ Fees in Class Actions the Right Price? (Above The Law) – Popular legal website Above the Law recently covered a panel discussion at the National Lawyers Convention of the Federalist Society. The discussion revolved around the fees for class actions, and whether attorneys pursuing class action claims are making too much. Criticism was levied against the courts for being no more than a “rubber stamp” for the high settlement legal fee payments that attorneys receive when the class benefits are comparatively small. Professor Brian Fitzpatrick argued that class actions are compensated on the appropriate level, and said his two year study found the average fee award was typically 15% of the class award. Jeffrey Jacobson of Debevoise & Plimpton also posited that settlements in class action suits that involve replacement of defective merchandise often have a lower award of damages, even though the attorneys on the case put in the same amount of time they would on any other class action. Settlement in those cases often ends up being a cheaper action for both parties.

Boise Attorney Disbarred for Multiple Ethical Violations (Idaho Statesman) – The Idaho Supreme Court disbarred Boise lawyer Rick Bergesen for a pattern of fraud and ethical violations. Prosecutors alleged that he took $150,000 illegally from a client on trial for damaging library books. As part of a plea agreement Bergesen pleaded guilty to grand theft. In 2010, his license to practice law was suspended for “charging unreasonable fees, failure to communicate fees and expenses, conflict of interest, accepting compensation from a third person where there is interference with attorney-client relationship, failure to return unearned fees upon termination, communication with a person represented by counsel, failure to deposit legal fees into trust, and conduct involving dishonesty, fraud, deceit or other misrepresentation. He admitted to all of the violations during the bar’s disciplinary process, according to the bar.” He currently is serving a 3 year sentence.

Lack of Billing Judgment Results in 40% Reduction to Requested Attorneys’ Fees (Sterling Analytics) – In Hayes v. Astrue, the plaintiff filed an application seeking $12,681.25 in attorneys’ fees. The United States District Court reduced the fee request by approximately 40%, awarding the plaintiff’s attorney $7,256.25. The plaintiff’s attorney sought to be compensated for 75 hours. However, the court found that a request of 75 hours was excessive and ultimately eliminated 32 hours. The plaintiff’s attorney had charged for time expended “signing up for e-filing.” The court found this time to be unreasonable, stating that “having an ECF account and familiarity with the system is nearly as essential to practice within this district as is being admitted to practice before the court.”

MF Global Trustee Attempting to Double Dip in Fees (Futures Mag) – The attorneys for MF Global Trustee James Giddens have filed a motion seeking to charge a service fee for misdirected wires that need to be returned, on top of his own fees. Customers see this as a way for the trustee to add on to his fees, and industry insiders are upset over the perceived “insult to injury.”

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