United States District Court, N.D. Florida, Pensacola Division
IN RE ABILIFY (ARIPIPRAZOLE) PRODUCTS LIABILITY LITIGATION This Document Relates to All Cases Firm Attorney Position(s) Firm Total Capital Firm Total Expenses Firm Percentage Fee Award Firm Percentage Award Fee Award
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
(5th 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
...