Judge Gary Feinerman issued a memorandum opinion approving a class settlement against Western Union Company under the Telephone Consumer Protection Act, but awarding attorney Joseph Siprut only $450,000 of the $2,804,850.27 he requested in fees and costs.
After discussing the case law applicable to attorney-fee awards in class cases, the court went another direction:
Were this an ordinary case, the court would proceed to address, among other things, whether to adopt the lodestar method or the percentage method, whether to adopt a sliding scale or a straight percentage approach if the percentage method were adopted, and whether to employ a lodestar cross-check on the amount derived from the percentage method. See generally In re Akorn, Inc. Sec. Litig., 2018 WL 2688877, at *1-4 (N.D. Ill. June 5, 2018); Gehrich, 316 F.R.D. at 234-39. But due to Siprut’s conduct in this matter, this is not an ordinary case.
The court noted that because of the detailed hourly counts submitted by counsel in support of his fees, “[t]he message conveyed by Siprut’s affidavit and chart was unmistakable: By reporting total hours in six-minute increments, and by further dividing those hours into fifteen finely-honed categories, Siprut plainly intended to convey the impression that he and his team had kept reasonably close track of their time.”
However, the court then explained that counsel actually had reconstructed his hours at the end of the case, and that “[t]he reconstructed time records here lack support and are highly suspect.”
Given all this, the court would be well within its rights to deny Siprut’s fee request in its entirety…Instead, given the good result he obtained for the class and the fact that he is responsible for covering additional administrative expenses, the court will award Siprut $425,000 in attorney fees and costs, which is five percent of the settlement fund.
This reduction reflects in part that Siprut failed to keep contemporaneous time records and, compounding the problem, failed to provide any support (other than his own say-so) for his reconstructed time calculations … The reduction also reflects in part the undeniable fact that Siprut, having failed to either maintain reasonably contemporaneous time records or provide support for his reconstructed records, proceeded to greatly inflate the hours he reported, just as he did in the Southwest Airlines Voucher case. 2018 WL 3651028, at *4. Finally, the reduction reflects in part that Siprut’s reporting his and his colleagues’ hours in six-minute increments, and his allocation of those hours across fifteen categories, was designed to create the impression of precision and reasonableness, when in fact the hours reported were wholly imprecise and unreasonable.