In re Abilify (Aripiprazole) Products Liability Litigation

          M. Casey Rodgers, Judge.

          REPORT AND RECOMMENDATION OF SPECIAL MASTER ELLEN REISMAN REGARDING AWARD OF COMMON BENEFIT FEES AND EXPENSES

          Gary R. Jones, Magistrate Judge.

         I. Introduction and Summary of Conclusions

         Common Benefit Fund Order No. 1, entered by this Court on February 21, 2017, appointed Randy Sansom as CPA and me as Common Benefit Special Master.^[1]Among other things, it directed Mr. Sansom and me to perform the tasks described in that Order, to make reports to the Court and to the Plaintiffs' Fees and Common Benefit Fund Committee (“PFFC”), and to ensure the accuracy of the “submissions and all accounts and records.”^[2] Over the last nearly three years, during the course of the Abilify litigation, Mr. Sansom and I have performed those duties.

         As the Order issued by this Court on February 25, 2019 states, early in 2019, the Parties reached a settlement and entered into a Confidential Master Settlement Agreement.^[3] The participation thresholds for that settlement have been reached and certified by Defendants, and the funds are now available for payment of both participating claimants and the Plaintiffs' attorneys whose work contributed to the common benefit. Common Benefit Fund Order No. 6, issued by the Court on June 5, 2019, specifies the process by which Plaintiffs' counsel may seek reimbursement of expenses and awards of fees relating to their common benefit work.^[4] CBO 6 provides that I am responsible for recommending an allocation of awards of attorneys' fees and costs, in consultation with the PFFC, Co-Lead Counsel, and the CPA.^[5] It further provides that I am to provide the Court with a Report & Recommendation setting forth my recommendations as to reimbursement of costs and apportionment of attorneys' fees for common benefit work.^[6]

         Over the last several months, as described below, law firms making requests for awards of common benefit expense reimbursements and fees have submitted Applications and made oral presentations pursuant to the requirements of CBO 6. Additionally, I have consulted with the PFFC, Mr. Sansom, and Co-Lead Counsel, and I have had discussions with numerous Plaintiff Leadership firms. Having received information from these many sources, on November 5, 2019, I circulated to all law firms that applied for common benefit expense or fee awards a confidential proposal for an agreed-upon allocation of fees (by percentage of the total). I requested that any firm objecting to this proposal notify me by the end of the day on November 7, 2019. No firm objected, and many expressed their support for it. Accordingly, my recommendation in this Report & Recommendation regarding the common benefit fee allocation is one that has been accepted by all affected firms.

         As described in greater detail below at Section V, it appears likely that a total of approximately $18, 940, 000.00 will be available to reimburse firms for their capital contributions, to reimburse firms for common benefit expenses appropriately submitted as held costs, and to award common benefit fees. As described below, the firms seeking common benefit awards performed a significant volume of work, resulting in a successful global settlement in a tort that presented challenging legal and scientific issues.

         My recommendations are as follows:

         1. All firms making capital contributions to the Litigation Fund^[7] should have the full amount of those contributions reimbursed to them (without interest). Those capital contributions total $3, 610, 000.00.

         2. All common benefit expenses appropriately submitted as held costs (pursuant to CBO 1) should be reimbursed to the firms claiming them, without further review by myself or the CPA. Those held costs total $1, 539, 845.35.

         3. Common benefit attorneys' fees should be awarded to each law firm according to the percentages set forth in the agreed-upon allocation provided herein.

         II. Abilify Litigation Background

         A. Establishment of the Multidistrict Litigation

         On October 3, 2016, the Judicial Panel on Multidistrict Litigation centralized 22 Abilify cases pending in various federal courts and transferred those cases to the United States District Court for the Northern District of Florida, thus creating MDL 2734, In re: Abilify (Aripiprazole) Products Liability Litigation.^[8]

         On October 19, 2016, the Court appointed Kristian Rasmussen of Cory Watson Attorneys (“Cory Watson”) and Gary Wilson of Robins Kaplan LLP (“Robins Kaplan”) as interim Co-Lead Counsel for Plaintiffs, and appointed Bryan Aylstock of Aylstock, Witkin, Kreis & Overholtz, PLLC (“AWKO”) as interim Liaison Counsel.^[9] Subsequently, after reviewing attorney applications for leadership roles, the Court appointed Plaintiffs' Leadership on December 16, 2016.^[10] On February 24, 2017, at the request of Plaintiffs' Leadership, the Court added two additional Plaintiffs' attorneys to the Joint Science and Expert Sub-Committee and two additional Plaintiffs' attorneys to the Joint Discovery Committee.^[11] As a result of these two Orders, the Plaintiffs' Leadership consisted of the following:

Firm	Attorney	Position(s)
Robins Kaplan	Gary L. Wilson	Co-Lead Counsel
Tara D. Sutton	Joint Discovery Committee
Science and Expert Sub-Committee
Joint Settlement Committee
Munir R. Meghjee	Plaintiffs' Federal/State Liaison Counsel
Cory Watson	Kristian Rasmussen	Co-Lead Counsel
Stephen Hunt, Jr.	Joint Discovery Committee
Ernest Cory	Joint Settlement Committee
Aylstock, Witkin, Kreis & Overholtz	Bryan Aylstock	Liaison Counsel
Plaintiffs' Fees and Common Benefit Fund Committee
Stephen H. Echsner	Joint Discovery Committee
Lieff Cabraser	Lexi J. Hazam	Plaintiffs' Executive Committee
Joint Discovery Committee
Science and Expert Sub-Committee
Donald Arbitblit	Science and Expert Sub-Committee
Levin Papantonio	Troy A. Rafferty	Plaintiffs' Executive Committee
Zimmerman Reed	J. Gordon Rudd, Jr.	Plaintiffs' Executive Committee
Kirtland & Packard	Behram V. Parekh	Plaintiffs' Steering Committee
Joint Discovery Committee
Electronically Stored Information SubCommittee
Pittman, Dutton & Hellums	Chris T. Hellums	Plaintiffs' Steering Committee
Plaintiffs' Fees and Common Benefit Fund Committee
Farr Law Firm	George T. Williamson	Plaintiffs' Steering Committee
Joint Discovery Committee
Electronically Stored Information SubCommittee
Napoli Shkolnik	Jennifer Liakos	Plaintiffs' Steering Committee
Science and Expert Sub-Committee
Childers, Schlueter & Smith	M. Brandon Smith	Plaintiffs' Steering Committee
GoldenbergLaw	Marlene J. Goldenberg	Plaintiffs' Steering Committee
Berger & Montague	Shanon J. Carson	Plaintiffs' Steering Committee

         B. Key Litigation Developments

         Plaintiffs' counsel worked quickly and diligently, conducting discovery and preparing their case in a fast-paced litigation with ambitious deadlines. It was apparent early in the litigation that establishing general causation would be a critical task for Plaintiffs, and as such, the bulk of the first eight to nine months of the litigation centered around preparation for general causation/Daubert hearings. The Daubert evidentiary hearing spanned four days and included Plaintiffs' counsel presenting four witnesses for live testimony: Antoine Bechara, Joseph Glenmullen, Eric Hollander, and David Madigan.^[12] Defendants also presented four witnesses for live testimony: Pierre Blier, Marc Potenza, Douglas Weed, and Catherine Winstanley.^[13] Preparation for the Daubert hearing was a significant undertaking which involved reviewing and evaluating thousands of documents, days spent preparing for, taking, and defending depositions, crafting and refining litigation strategy, and extensive briefing requiring the drafting of several Daubert motions, oppositions, and replies.

         After hearing the Parties' arguments and reviewing the voluminous record, the Court, in a 164 page order indicative of the complexity of the issue and reflective of the amount of preparation and effective advocacy by Plaintiffs' counsel, concluded that “Plaintiffs have satisfied their burden to demonstrate that a genuine dispute of material fact exists as to whether Abilify can cause uncontrollable impulsive behaviors in individuals taking the drug, ” and thus denied Defendants' Motion for Summary Judgment.^[14] This Order was a pivotal development in Plaintiffs' case and, had the Court reached a different result, there would likely have been no recovery at all for Plaintiffs.

         Concurrent with discovery and preparation related to general causation and the Daubert hearing, the Court selected the six cases originally filed in the Northern District of Florida for case-specific work up (“First Trial Pool”).^[15] On March 23, 2017, the Court entered the Parties' Stipulated Order, which set deadlines to complete document discovery, identify experts and produce expert reports regarding specific causation, complete depositions (fact and expert), and file dispositive motions.^[16] As discovery progressed, the First Trial Pool was whittled to three cases by June 2017: Lilly, Viechec, and Lyons.^[17] In March 2018, the Court randomly selected the order of the cases for trial^[18] and set trial dates as follows: Lyons for June 18, 2018; Viechec for August 6, 2018; and Lilly for August 27, 2018.^[19] On April 27, 2018, less than two months before the Lyons trial was to commence, the Parties, after a successful mediation, resolved the First Trial Pool cases.^[20]

         On August 10, 2018, the Court randomly selected forty cases for case-specific discovery (“Second Discovery Pool”) and permitted each side to strike five cases from the pool.^[21] For the remaining thirty cases, the Court ordered Plaintiffs to provide a completed Plaintiff Fact Sheet; medical, financial, and/or gambling records authorizations; and copies of relevant medical, financial, and/or gambling records within two months.^[22] After the strike process and review of potential Lexecon^[23] issues, the Second Discovery Pool was reduced to twenty seven cases.^[24] In September, the Court determined that six of the Second Discovery Pool cases would be randomly selected as trial picks and would proceed on a separate “Fast-Track” for discovery and trial (“Fast Track Cases”).^[25] Tight discovery deadlines were established for the Fast Track Cases, ^[26] and trials were scheduled to be held in the summer of 2019.^[27] Ultimately, none of the Second Discovery Pool cases or Fast Track Cases proceeded to trial due to announcement of a global resolution in February 2019.

         C. Settlement

         Early in the litigation, upon the recommendation of the Joint Settlement Committee, the Court appointed Cathy Yanni as Settlement Master.^[28] Settlement discussions initially proceeded slowly in light of the outstanding general causation issue. Despite the obstacle of uncertainty regarding general causation, the Parties held several settlement conferences with Settlement Master Yanni, meeting almost monthly from June through October 2017.^[29] After settlement of the three First Trial Pool cases in April of 2018, on May 2, 2018, the Court entered Global Settlement Order No. 1 to facilitate the exchange of information between the Parties in order to aid settlement discussions toward a global resolution.^[30]

         After several months of negotiations and in-depth case review, the Parties reached agreement and on February 15, 2019, announced that they had entered into a Confidential Master Settlement Agreement intended to resolve Abilify compulsivity claims pending in state and federal courts throughout the United States.^[31] Since announcement of the settlement, the Parties have worked diligently to ensure the success of the settlement. As noted in the Court's Order describing the settlement, a 90% acceptance rate was required for the settlement to be effective.^[32]Defendants have certified compliance with that requirement.

         D. Capital Contributions and Litigation Expenses

         Pursuant to CBO 1, the Plaintiffs' Executive Committee had the authority to make assessments to “effectively prosecute the interests of the litigation.”^[33] Over the course of the litigation, Plaintiffs' Leadership contributed a total of $3, 610, 000.00 across five assessments to the Litigation Fund, which was managed by the Special Master and CPA. The Litigation Fund was used to pay shared costs such as a document production and review platform, court reporting services, translation services, as well as general expert fees, Special Master fees, Settlement Master fees, and fees for the Court-appointed CPA. Requests for payment from the Litigation Fund were reviewed by the Special Master, CPA, and PFFC, and payments were made only after all of their approvals. As of November 30, 2019, $3, 587, 249.36 has been paid from the Litigation Fund, essentially exhausting the Fund.

         E. Attorney Hours Submissions

         CBO 1 required all Plaintiffs' counsel seeking to recover common benefit fees and/or expenses to “keep a daily contemporaneous record of their time and expenses, noting with specificity the amount of time and particular activity along with confirmation that authority was obtained to have undertaken that common benefit effort.”^[34] Time and expense records were required to be submitted into the Time Locker and Expense Locker systems every two months.^[35] The Special Master, CPA, and PFFC developed time and expense entry guidelines consistent with the requirements specified in the Court's Order and monitored the submission of firms' time and expense records.

         Eighteen firms (thirteen with Leadership appointments and five without such appointments) submitted Applications totaling approximately 70, 400 hours for common benefit consideration.^[36] Of those hours, approximately 25, 925 (37%) were designated as hours related to document review.

         III. Legal Standard for Common Benefit Awards

         The common benefit doctrine permits “the creation of a common fund in order to pay reasonable attorneys' fees for legal services beneficial to persons other than a particular client, thus spreading the cost of the litigation to all beneficiaries.”^[37] The common benefit doctrine has its roots in the court's equitable powers, quantum meruit, and inherent authority to manage complex litigation.^[38] The primary goal in determining a fee award in common fund cases is to determine an amount that is reasonable under the circumstances.^[39]

         In the Eleventh Circuit, Camden I Condominium Ass'n, Inc. v. Dunkle stated that the factors enunciated in Johnson v. Georgia Highway Exp., Inc., 488 F.2d 714 (5^th Cir. 1974) are appropriate to use when setting, evaluating, and reviewing fee awards in common fund cases.^[40] Those factors are: (1) the time and labor required; (2) the novelty and difficulty of the questions involved; (3) the skill requisite to perform the legal service properly; (4) the preclusion of other reemployment by the attorney due to acceptance of the case; (5) the customary fee; (6) whether the fee is fixed or contingent; (7) time limitations imposed by the client or the circumstances; (8) the amount involved and the results obtained; (9) the experience, reputation, and ability of the attorneys; (10) the “undesirability” of the case; (11) the nature and length of the professional relationship with the client; and (12) awards in similar cases.^[41]

         While the Johnson factors serve as guidance for determining a fee award, the Camden court noted that those factors are not exclusive because “any fee must be determined upon the facts of each case, ”^[42] and “[i]n most instances, there will also be additional factors unique to a particular case which will be relevant to the district court's consideration.”^[43]

         IV. Special Master's Approach, Review Process, and Review Criteria

         Common Benefit Order No. 6 sets forth the process by which law firms could apply for common benefit expense reimbursements and fee awards.^[44] To summarize, each law firm was required to submit a completed Common Benefit Application to me by July 22, 2019. That Application was to consist of the following: 1) the firm's self-audit of its time and expenses, 2) a Narrative setting forth the firm's qualitative contribution to the litigation, along with biographies of all lawyers who submitted hours, and 3) an Affidavit of a senior partner attesting to the truth and accuracy of the Application, including the certification that the hours and expenses were for the common benefit and in compliance with the Court's Common Benefit Orders.^[45] Eighteen firms submitted such Applications.^[46] All were reviewed by myself and Mr. Sansom.

         Additionally, CBO 6 provides that each firm submitting an Application had the right to make an oral presentation, which would be recorded by a court reporter.^[47]On September 18, 2019, I emailed the eighteen firms that had submitted Applications asking if they wished to make an oral presentation. Eleven firms requested the opportunity to present.^[48] These presentations were held on October 21, 22, 23, and 31 - all telephonically.

         In addition, as noted above, Mr. Sansom and I discussed the possibility of an agreed-upon fee allocation with the PFFC, Co-Lead Counsel, and lawyers from many of the law firms that had submitted Applications.

         In making my recommendations as to expense and fee awards, I was guided by both the Johnson factors described above and the considerations set forth in CBO 6:

1. The extent to which each firm made a substantial contribution to the outcome of the litigation;

2. The quality of each firm or attorney's work;

3. The consistency, quantum, duration, and intensity of each firm or attorney's commitment to the litigation;

4. The level of experience, reputation, and status of each attorney and firm, including partner participation by each firm;

5. Common benefit work performed in non-MDL jurisdictions to the extent it contributed to the outcome of the litigation and benefitted the MDL;

6. Membership and leadership positions within the MDL;

7. Whether counsel made significant contributions to the funding of the litigation and creation of the Common Benefit Fund;

8. Commitment to and efforts toward overall resolution of the litigation;

9. Whether Plaintiffs' Counsel propose an agreement regarding the allocation common benefit fees and expenses; and

10. Any other relevant factors as guided by governing fee jurisprudence.^[49]

         As the Order notes, my review was to be a qualitative analysis, not one driven solely by numbers of hours worked or by financial contributions.^[50] I therefore applied the information that I received from the Applications, oral presentations, and other consultations to the Johnson factors and to the considerations set forth in CBO 6 as I formulated my recommendations.

         In making my proposal for a percentage allocation of fees, I considered (in no particular order):

1. Which attorneys made significant, substantive contributions at key points in the litigation - e.g., the Daubert hearing, readying the First Trial Pool cases for trial, settlement negotiations;

2. Which attorneys were recognized by their peers for taking on organizational or leadership roles in developing the ...