United States District Court, D. Minnesota
ORDER REGARDING PLAINTIFFS' MOTION FOR ATTORNEYS' FEES AND REIMBURSEMENT OF EXPENSES
SUSAN RICHARD NELSON, District Judge.
This matter is before the Court on Plaintiffs' Motion for Attorneys' Fees and Reimbursement of Expenses and Incentive Awards for Named Plaintiffs [Doc. No. 606]. In this Motion, the law firm of Schlichter, Bogard & Denton ("Class Counsel") requests a court-approved fee for its role in obtaining a settlement of class claims under the Employee Retirement Income Security Act ("ERISA") in the above-captioned action. The settlement provides a $27.5 million monetary recovery for the benefit of as many as 46, 098 current and former participants in the 401(k) plan offered to employees of Ameriprise Financial (the "Plan"), as well as important affirmative relief designed to reduce fees and improve investment offerings in the Plan. Class Counsel has asked this Court to approve a fee award of one-third of the monetary settlement obtained, or $9, 166, 666, and to award it $782, 209.69 for outstanding expenses. Additionally, Class Counsel has requested that this Court approve $25, 000 incentive awards for each of the five Named Plaintiffs. For the reasons set forth below, the Court finds that the requested awards are reasonable and merited and, accordingly, grants Plaintiffs' Motion.
II. FINDINGS AND CONCLUSIONS
A. Class Counsel's Request for Attorneys' Fees
Under the "common-fund" doctrine, class counsel is entitled to a reasonable fee drawn from the commonly-held fund created by a settlement for the benefit of a class. See, e.g., Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980). This Court considers seven factors in determining whether the requested percentage of the common fund is reasonable: "(1) the benefit conferred on the class, (2) the risk to which plaintiffs' counsel was exposed, (3) the difficulty and novelty of the legal and factual issues of the case, (4) the skill of the lawyers, both plaintiffs' and defendants', (5) the time and labor involved, (6) the reaction of the class, and (7) the comparison between the requested attorney fee percentage and percentages awarded in similar cases." Yarrington v. Solvay Pharms., Inc., 697 F.Supp.2d 1057, 1062 (D. Minn. 2010). In addition, a court must consider the affirmative relief obtained when evaluating the overall benefit to the class. See Manual for Complex Litigation (Fourth) § 21.71 (2004).
1. The benefit conferred on the Class
Class Counsel's efforts have brought about both a significant monetary recovery and important reforms to the Plan. Current and future Plan participants will continue to benefit for years from the affirmative relief obtained, which, combined with the monetary settlement amount, increases the value of the settlement to an estimated $58.1 million. (Brown Decl. [Doc. 610] ¶ 8.) For these reasons, the benefit conferred on the Class supports awarding the requested fee.
2. The risk, difficulty, and novelty of the litigation
Class Counsel was also exposed to great risk. Not only did they face the very real possibility of dismissal or denial of class certification, but ERISA is a complex field that involves difficult and novel legal theories and often leads to lengthy litigation. For example, during the pendency of this action, the Eighth Circuit Court of Appeals in Tussey v. ABB Inc., 746 F.3d 327 (8th Cir. 2014), remanded in part a judgment obtained by Class Counsel after trial, resulting in what will be additional litigation for a case first filed in 2006. Given the risk, the difficulty and novelty of the issues involved, and Class Counsel's demonstrated willingness to pursue this action for four years of intense, adversarial litigation, the Court finds that these factors also weigh in favor of Plaintiffs' fee request.
3. The skill of the lawyers
Few lawyers or law firms are willing and capable of handling the type of national litigation at issue here, and the Court's docket-over 600 entries long-demonstrates both sides' diligent and zealous representation of their clients' interests. Moreover, litigating the complex issues in this case required the attorneys to exercise extraordinary skill and determination. In fact, another judge in this Circuit has noted that Class Counsel are "experts in ERISA litigation." Tussey v. ABB, Inc., No. 06-04305-CV-C-NKL, 2012 U.S. Dist. LEXIS 157428, at *10 (W.D. Mo. Nov. 2, 2012). Accordingly, this factor weighs in favor of granting Plaintiffs' fee request.
4. The time and labor involved
The Court assesses the reasonableness of an attorney fee request under the lodestar method. To calculate the lodestar amount, the Court must multiply the reasonable number of hours expended by a reasonable hourly rate for each attorney performing the work. City of Burlington v. Dague, 505 U.S. 557, 559-60 (1992). Here, Class Counsel spent approximately 27, 991 attorney hours and 2, 716 hours of non-attorney professional time litigating this case. (O'Gorman Decl. [Doc. No. 613] ¶ 2.) Plaintiffs argue that application of a reasonable market rate would result in a lodestar amount of over ...