ADAMS v. BOWATER INCORPORATED

2004 | Cited 0 times | D. Maine | May 19, 2004

RECOMMENDED DECISION ON ATTORNEY FEES MOTIONS1

Now pending are four motions submitted by the plaintiffs in theirquest for attorney fees. The first motion (Docket No. 152) seeks an awardof statutory attorney fees pursuant to ERISA, 29 U.S.C. § 1132(g).Specifically plaintiffs seek an Order directing that defendants pay themstatutory attorneys' fees of $1,668,215.00 plus a 25% enhancement forextraordinary result of $417,053.75, for a total of $2,085,268.75; forparalegal fees of $218,652.50; and for necessary out-of-pocketdisbursements in the case of $140,390.88 (See also, Docket No.157, Bill of Costs). The defendant does not oppose an award of statutoryattorney fees,2 but challenges numerous aspects of the plaintiffs'request, (Docket No. 162), some of which are conceded by the plaintiffsin their reply memorandum (Docket No. 173). The second motion asks the Court forleave to conduct discovery concerning what fees the defendants paid theirlawyers, in the event that the defendants (collectively referred to as"Bowater") challenge as excessive either the number of hours plaintiffs'counsel worked or the hourly rates that they request. (Docket No. 153.)The third motion seeks an additional award of "common fund" attorney feesbecause there are some individuals who benefited from this litigationwithout sharing the litigation burdens assumed by the plaintiffs. (DocketNo. 155.) The fourth motion asks for leave to conduct discovery todetermine the number of non-plaintiffs who benefited and the degree towhich they have already benefited or may yet benefit, so that the Courtmight be able to calculate an appropriate common fund award. (Docket No.154.) I recommend that the Court deny the motion for an award of commonfund attorney fees and the related discovery motion because there is nocommon fund available from which to make an award. I further recommendthat the Court grant the plaintiffs' motion for statutory attorney fees,but in a reduced amount. I see no need for discovery and therefore woulddeny the motion for leave to conduct discovery regarding the fees Bowaterpaid to its counsel.

Background

A brief history of this case has already been provided by the FirstCircuit Court of Appeals: In August 1999, Great Northern, until then a subsidiary of Bowater, was sold in a share sale to a third party. Bowater, however, retained the assets and responsibilities of the pension plan that covered both Bowater and Great Northern employees. In the same month, Bowater announced that it would amend the plan to cut back certain early retirement benefits that the plan offered to Great Northern employees. The plan was so amended in October retroactive to August 13. In brief, the plan prior to August 1999 had allowed employees with extensive service at Great Northern to opt for early retirement and yet receive pensions as if they had retired at ordinary retirement age or, in other cases, with something less than the usual discount in benefits for early retirement. For example, an employee who had worked 30 years could retire at age 60 and receive the same benefits as if he had worked to 65. In effect, Bowater's amendment meant that future work by employees at Great Northern, now no longer a Bowater subsidiary, would not count for purposes of early retirement. Whether and to what extent an employer can cut back on such benefits for employees who have not yet retired is governed by provisions of ERISA-in particular, by section 204(g), 29 U.S.C. § 1054(g) (2000). For present purposes, the details of the statute and its application here are unimportant; it is enough to say that Bowater maintained that its cut-back was lawful and that the employees took the opposite position. In January 2000, the Bowater employees brought the present action in federal district court under ERISA against Bowater and the plan. The main count of the complaint (count I) sought a declaration that the plan amendment violated section 204(g) and an order requiring the defendants to delete the amendment. Other counts (counts II and III)3 sought further relief for ten of the plaintiffs who said that they had relied on Bowater's statements about the amendment and advice to individual employees; the ten plaintiffs said that as a result they had accepted lump sum payments, surrendering their rights to the greater benefits that would have been available to them under the original plan. At this point, Bowater began to retreat but reluctantly. In March 2000, Bowater, as plan administrator, sent a letter saying that work done by Great Northern employees would continue to be credited toward early retirement; the letter did not explain how this could be reconciled with the plan amendment. In the same month Bowater filed its answer to the complaint which continued to deny that the plan amendment was unlawful. In April, Bowater amended the plan to conform to the letter, but it declined to enter into a consent decree conceding that the original amendment was unlawful or promising not to adopt the same amendment in the future. Count I was referred to a magistrate judge and, based on her recommendation, the district court ruled in September 2000 that count I was moot. Litigation on counts II and III continued4 until, in October 2000, Bowater posed a notice agreeing to allow full benefits under the original plan to those who had taken a lump sum payment in exchange for surrendering their right to full benefits. In June 2001, Bowater amended the plan to conform to this promise of full benefits. Thereafter, the district court ruled that counts II and III were moot.Adams v. Bowater. 313 F.3d 611, 612-13 (1st Cir. 2002)(footnotes added). On appeal, the First Circuit Court of Appeals vacatedthe judgments and remanded for further proceedings.

In February, 2003, I held a conference of counsel to discuss further proceedings. (Docket No. 126). Plaintiffs were ordered to file a renewed dispositive motion addressing the issues under ERISA § 204(g) by February 25, 2003. At the same conference, defendants requested leave to renew their motion to dismiss because of mootness. I indicated that they could file such a motion, but that since the matter had again been referred to me, I intended to issue a recommended decision regarding the merits of the ERISA § 204(g) claim in light of the remand order. Accordingly, on March 18, 2003, defendants filed in conjunction with their response to the plaintiffs' renewed motion for summary judgment, a motion for summary judgment based upon mootness.(Docket No. 137.) In favor of a finding of mootness, Bowatersupplemented the summary judgment record with an affidavit from Harry F.Geair, Bowater's Vice President, General Counsel and Secretary, whoaverred under penalty of perjury, "Under no circumstances will Bowateradopt any Plan amendment or take any other action which would rescind theApril 25, 2000 or June 25, 2001 Plan amendments." (Seeid.) I concluded, in essence, that this was too little, toolate and recommended that the Court deny Bowater's motion for summaryjudgment. (Id.) Turning to the merits of the plaintiffs'claims, I recommended that summary judgment enter on their behalf withrespect to all three counts because Bowater's initial amendment of theplan amounted to a prohibited cut-back of accrued benefits under ERISA. In reachingthis recommendation, I rejected Bowater's contention that the plaintiffscould not continue as plan participants simply because GNP was sold to athird party. (Id.) The Court subsequently adopted myrecommendation over Bowater's objection and issued the requesteddeclaratory and injunctive relief. (Docket No. 147.) Bowater did notpursue an appeal and the instant fee-related motions were duly filed.

Papers submitted in conjunction with the plaintiffs' fee motionsreflect that they have agreed to pay a 25 percent contingency fee totheir counsel, which is calculated based on the amount by which theinstant litigation enhanced the plaintiffs' benefits under the Plan. Theplaintiffs estimate that their net enhanced benefits will exceed $10million.

I. Statutory Fee Award

The parties are in agreement that, pursuant to ERISA § 502(g)(1),29 U.S.C. § 1132(g)(1), the Court "in its discretion may allow areasonable attorney's fee and costs" to the plaintiffs in this suit.Although such an award of attorney fees is "not obligatory,"Cottrill v. Sparrow. Johnson & Ursillo. Inc., 100 F.3d 220,223 (1st Cir. 1996) (affirming the denial of ERISA attorney fee award),Bowater has not argued that the Court should deny the plaintiffs' motion,only that the plaintiffs' motion "seeks an unreasonable amount ofattorneys' fees and costs and should be substantially reduced." (DocketNo. 162 at 2.) Accordingly, I do not address the five factors that theCourt of Appeals has prescribed to guide a court's deliberations onwhether to make such an award. See Cottrill. 110 F.3dat 225 (listing the five "exemplary rather than exclusive" factors).Rather, I turn to the issue of what constitutes a reasonable ERISAattorney fee award under the "lodestar." See Stark v. PPM Am., Inc., 354 F.3d 666, 674 (7th Cir. 2004)(approving district court's use of the lodestar methodology to determinean ERISA § 502 attorney fee award).

Ordinarily, the trial court's starting point in fee-shifting cases is to calculate a lodestar; that is, to determine the base amount of the fee to which the prevailing party is entitled by multiplying the number of hours productively expended by counsel times a reasonable hourly rate. See Hensley v. Eckerhart. 461 U.S. 424, 433, 76 L.Ed.2d 40, 103 S.Ct. 1933 (1983). Typically, a court proceeds to compute the lodestar amount by ascertaining the time counsel actually spent on the case "and then subtracting from that figure hours which were duplicative, unproductive, excessive, or otherwise unnecessary." Grendel's Den, Inc. v. Larkin, 749 F.2d 945, 950 (1st Cir. 1984). The court then applies hourly rates to the constituent tasks, taking into account the "prevailing rates in the community for comparably qualified attorneys." United States v. Metropolitan Dist. Comm'n. 847 F.2d 12, 19 (1st Cir. 1988): see also Grendel's Den. 749 F.2d at 955. Once established, the lodestar represents a presumptively reasonable fee, although it is subject to upward or downward adjustment in certain circumstances. See Blum v. Stensoa 465 U.S. 886, 897, 79 L.Ed.2d 891, 104 S.Ct. 1541 (1984).Lipsett v. Blanco. 975 F.2d 934, 937 (1st Cir. 1992);see also Okot v. Conicelli. 180 F. Supp.2d 238,242 (D. Me. 2002) (internal citations and punctuation omitted). Theplaintiffs bear the burden of establishing the reasonableness of therates and hours submitted in their motion for fees. Chaloult v.Interstate Brands Corp., 296 F. Supp.2d 2, 4 (D. Me. 2004). "Thefigure derived from the lodestar calculation may be adjusted up or downto reflect [their] degree of success in the litigation."Chaloult. 296 F. Supp.2d at 4 (citing Hensley v.Eckerhart. 461 U.S. 424, 434, 103 S.Ct. 1933, 1940, 76 L.Ed.2d 40(1983)).

A. Reasonable Rate

In determining a reasonable hourly rate, the Court "considers theprevailing rates in the community for attorneys with similar experienceand qualifications to those for whom fees have been requested."Okot 180 F. Supp.2d at 242. On this issue the plaintiffs have submitted no evidence. Instead, they argue in theirmemorandum that their counsel should be considered part of a nationalcommunity of ERISA litigators and their rates set accordingly: $350 perhour for Attorney James W. Case and $400 per hour for Attorneys PatrickN. McTeague and William T. Payne. (Docket No. 156, Ex. 2, p. 317.) Theplaintiffs argue that this rate is justified because their suit involvedmillions of dollars in employee benefits, complex legal issues, a large,international corporate defendant, and "a Plan with approximately 1,000active service plan participants, and approximately 650 planbeneficiaries and 551 named Plaintiffs." (Docket No. 152 at 11.)Additionally, the plaintiffs contend that their counsel's hourly rateshould be set at a national rate because Bowater hired attorneys at theSeyfarth Shaw firm, which has approximately 500 attorneys and because theWestern District of Michigan in 2003 imposed an award against Bowater topay fees based on hourly rates between $340 and $450. (Id. at12-13 (citing Crosby v. Bowater Inc. Retirement Plan,262 F. Supp.2d 804 (W.D. Mich. 2003).) Other than citing the Michigan case,the plaintiffs offer no real evidence of what a national rate is.Nor do they offer any testimony by someone participating in theso-called national ERISA litigation market suggesting that counsel'slevel of experience and expertise is comparable to attorneyspracticing within this market. What the plaintiffs indicate theywould prefer to do is conduct discovery concerning the hourly rateBowater paid its Seyfarth Shaw attorneys, as though this wouldsufficiently fill in the gaps in their motion. The plaintiffsindicate, in short, that their counsel's lodestar rate should becomparable to the hourly rates charged by Seyfarth Shaw attorneysbecause plaintiffs won. (Docket No. 152 at 13.) In opposition to this presentation, Bowater argues that the lodestarrate should be established based on the hourly rate charged byMaine-based counsel who specialize in labor litigation. They offer theAffidavit of Richard G. Moon, Esquire, a Maine-based attorney whosepractice has concentrated on labor and employment issues and relatedlitigation for over 25 years. Attorney Moon presently charges $275 perhour for representation in ERISA proceedings. (Docket No. 162, Ex. C,¶ 5.) Attorney Moon represents that his rates are at the higher endof the spectrum for Maine attorneys in labor law/ERISA practice and thathe is not aware of any Maine ERISA attorney charging rates of $400 perhour. (Id. ¶¶ 6-7.)

In connection with their reply, the plaintiffs reveal that AttorneyMcTeague charges $250 per hour and Attorney Case charges $220 per hour inthe context of other matters (First Supp. Aff. of Patrick N. McTeague,Docket Nos. 174; Affidavit of James W. Case, Docket No. 176), but theymake no reference to these concessions in their reply memorandum (DocketNo. 173). There does not appear to be an affidavit from Attorney Payne.

Although I fully appreciate plaintiff counsel's considerable skill andexperience, the showing the plaintiffs make does not justify the ratesthat they seek. The appropriate community rate is the rate that anotherMaine attorney of comparable experience and expertise would be able tocharge a paying client (as opposed to a contingent fee client) forsimilar representation. Although the First Supplemental Affidavit ofMcTeague and the Affidavit of Case do not speak to the issue of the"community" rate, which is distinct from what rates they may haveprivately obtained, see Stark, 354 F.3d at 675,5 nevertheless, viewing the McTeague and Case affidavits inconjunction with Attorney Moon's affidavit, and considering the nature ofthis dispute, I would conclude that $220 per hour constitutes areasonable hourly rate for the plaintiffs' attorneys with the exceptionof Attorney McTeague whose reasonable rate is $250 per hour. The corelegal issue in this case has always been whether Bowater violated ERISA§ 504(g), 29 U.S.C. § 1054(g) (the "anti-cut back" provision),by amending the Plan to preclude GNP participants from aging intoaccrued early retirement benefits. This presented a straight-forwardlegal issue that was locked and loaded from the commencement of thiscase. Both parties moved for summary judgment on the primary claim(count I) three months after the complaint was filed. (Docket Nos.7, 13.) Bowater contended that its amendment of the Plan was not aprohibited cut back because the stock sale of GNP to a third partyhad terminated the GNP employees from any legal affiliation withBowater (as Plan sponsor). Moreover, as of the filing of the initialsummary judgment motions, Bowater had undone the unlawful amendmentwith a corrective amendment, effectively undoing the injury it hadcaused the vast majority of the plaintiffs. (See Docket No.23.)

Following the Court's acceptance of my initial recommendation on countI, the ten count II and III plaintiffs turned their efforts towardevaluating what harm befell them by virtue of opting for less favorableearly retirement options in reliance upon the initial, unlawful Planamendment. Unlike the count I plaintiffs, the count II and III plaintiffs allegedly suffered a readily discernable injury that could not beundone simply by undoing the unlawful amendment. As for the count Iplaintiffs, however, the focus of the case became discovery initiativesin support of their eventual motion for attorney fees6 (SeeOct. 25, 2000, Report of Conference of Counsel, Docket No. 33), which wasunderstood not to be foreclosed by the fact that count I hadbeen dismissed as moot. Counts II and III required two rounds of summaryjudgment motions before Bowater amended the plan in a manner that ensuredno harm would befall the plaintiffs. (Docket Nos. 40, 91.) Briefing onthe mootness issue was "déjà vu all over again," althoughBowater's "controlled group" theory first presented itself at thisjuncture. Similarly, the plaintiffs' motion for summary judgment oncounts I and II presented the same core argument of illegality that hadbeen maintained in the very first go round, including the recurring issueof whether the stock sale served to terminate the plaintiffs' benefitsbecause the plaintiffs had become disassociated from Plan sponsorBowater. (Docket No. 94.) On appeal the First Circuit Court of Appealsfound the mootness issue "quite close," but reversed. Adams.313 F.3d at 613. The summary judgment cross-motions resurfaced withoutsignificant revision (Docket Nos. 127, 130), and Counts I, II and IIIwere ultimately resolved largely on the basis of arguments presented atthe first summary judgment stage, albeit primarily by making reference tothe Plan language, something that the plaintiffs' counsel largelyoverlooked in their arguments.

In sum, although protracted, these legal issues presented by thislitigation were no more complex than most of the litigation taking placein this Court. My assessment is that the most complicated aspect of this case arose simply becauseof the numbers of plaintiffs, but this fact actually suggests that manyhours were likely spent administering to the clients rather than formal"legal" work. As for the protracted nature of the case, the Court'sclose, but ultimately mistaken conclusion on mootness is partly to blame.Blame also falls on Bowater, which engaged in a protracted, multi-stagedretreat when a full surrender was probably more appropriate. There is noquestion but that the plaintiffs should be awarded fees for the timeexpended as a consequence of these factors. But I am not persuaded thatthey should receive an enhancement bonus in their counsel's hourly wagerate.

B. Reasonable Hours

Bowater addresses numerous problems in the plaintiffs' fee application,which I address topic by topic, as set forth in Bowater's opposition.(Docket No. 162.)

1. Unrelated work

Bowater objects to the plaintiffs' request for attorney fees related to243.9 hours of time spent by plaintiffs' counsel on matters that appear,from counsel's timesheet, to be unrelated to this litigation. (Docket No.162 at 7 & Ex. A, pp. 19-35.) The plaintiffs are willing to concede185.55 of these hours. (Docket No. 173 at 5-6 & Ex. A1, ¶ 12& Ex. A2, pp. 19-35.) My impression is that more hours ought to betrimmed than 185.55. Of the 243.9 hours identified by Bowater, onlyone-half hour (0.5) of time spent on "legal research re ERISA antialienation and note to co-counsel" appears likely to be sufficientlyrelated to the subject matter of this litigation. Based on the paperrecord, which lacks testimonial evidence explaining how the hours indispute relate to this litigation, I would reduce the plaintiffs' requestby 243.4 hours on account of unrelated billing activity. Specifically, I would disallow: 0.2 hour billed by Attorney Jeffrey N. Young; 0.7 hour billed by Attorney Wayne W. Whitney; 1.4 hour billed by Attorney Payne; 35.4 hours billed by Attorney Case; and 205.7 hours billed by Attorney McTeague. 2. Work on unsuccessful claims

Bowater complains that the plaintiffs have not segregated workperformed in connection with the short-lived count IV, which involved atthe very least research, drafting and moving to add the count in a secondamended complaint (Docket No. 34, 37, 54), briefing in response toBowater's motion to dismiss (Docket No. 45) and seeking to further amendthe second amended complaint (Docket No. 45). The plaintiffs respond thatcount IV involved minimum time and effort and that this objection amountsto "small potatoes." (Docket No. 173 at 6.) In my own review of thetimesheet, I count roughly 33 hours specifically designated as count IVor related activity between October 27, 2000, and January 4, 2001,including a portion of attorney time spent consulting with theplaintiffs' actuary regarding this count or preparing for relateddepositions.

Specifically, I would disallow: 8 hours billed by Attorney Payne; and 38 hours billed by Attorney McTeague. 3. Work performed after first plan amendment

Bowater contends that the plaintiffs should not recover attorney feesfor litigation occurring after April 25, 2000, the date the Plan wasre-amended, because the plaintiffs "achieved success in the litigation" as of that date and the"remainder of the litigation dealt with mootness . . . and was more anexercise in increasing fees for Plaintiffs' counsel than an attempt toprovide substantive relief or reimbursement to Plaintiffs for any damagesthey may have incurred." (Docket No. 162 at 8.) The plaintiffs respondthat mootness was not the only issue because Bowater kept pressingdefenses to the plaintiffs' contention that the initial plan amendmentwas illegal. (Docket No. 173 at 7.) I also observe that this case wasultimately not resolved based on mootness, but on the merits. Although Iagree with the plaintiffs that their award of attorney fees shouldinclude time billed after April 25, 2000, Bowater's point is not entirelylost on me. The fact that the vast majority of the plaintiffs obtainedsubstantive relief within the first few months of litigation is part ofthe reason why I have recommended that the Court not increase its awardby using a national hourly rate or otherwise applying an enhancementmultiplier to its award. In fairness to the plaintiffs' counsel, I alsonote that the entire matter could have been put to bed in April 2000 hadBowater been willing to agree to an appropriately worded consent judgmentat that time, as I suggested during an early case management conference.

4. Vague entries

Bowater challenges numerous attorney billing entries as too vague tosupport an award of fees. (Docket No. 162 at 9-10.) The plaintiffsconcede 19 of the 76.45 hours challenged by Bowater. (Docket No. 173 at8.) The parties' respective charts tell the story, albeit vaguely.(Docket No. 162, Ex. A, pp. 13-18; Docket No. 173, Ex. A2, pp. 13-18.) Myassessment is that the vast majority of Bowater's vagueness challengeshave merit. The onus is on the plaintiffs to produce quality billingrecords in the first instance. I am not impressed by their efforts to elaborate on some entriesand I am not inclined to accept their invitation to reconstruct oneattorney's vague entries by reference to another attorney's entries onthe same date, given the volume of entries at issue. I would reduce anyaward by 76.45 hours. The few entries that are close calls are "smallpotatoes," using plaintiffs' counsel's terminology.

Accordingly, I would disallow: 17.75 hours billed by Attorney Case; 0.5 hour billed by Attorney Jeffrey N. Young; and 58.2 hours billed by Attorney McTeague. 5. Duplicative entries and overstaffing

Bowater complains that the plaintiffs' counsel routinely overstaffed"every court appearance, deposition and meeting that occurred." (DocketNo. 162 at 10.) They also complain of duplicative document review andmultiple attorneys billing for inter-office conferences. (Id.at 10-11.) They ask the court to nix 62.95 hours for "duplication ofeffort," 3.8 hours for duplicate time entries, 208.2 hours for duplicateattendance, and 88.35 hours for "intra-office conferences."(Id., Ex. A, pp. 4-13.) The plaintiffs argue that multipleattorney billings are appropriate because of the size of the case, thevalue of collaboration and the need to keep everyone informed. (DocketNo. 173 at 8-11.) They also observe that Bowater was represented bymultiple attorneys at some hearings, depositions and conference.Overstaffing and duplication of work raises a legitimate issue where areasonable fee award is at issue. On the other hand, added value oftencomes from collaborative work and it is reasonable that clients shouldpay for it under some circumstances. The problem here is that a line-by-lineconsideration of the multitude of time entries presented is notpracticable. Of the 363.3 total hours challenged in these categories Iwould discount 218 (roughly 60 percent), understanding that thechallenged hours are duplicative hours, and that for every hourchallenged, there is already an hour that has not been challenged.Disallowed hours will be earmarked to Attorney Case's and AttorneyPayne's duplicative billings first, because the plaintiffs request alower hourly rate for Attorneys Case and Payne than Attorney McTeague.

Accordingly, I would disallow: 165.05 hours billed by Attorney Case; and 52.95 hours bills by Attorney Payne. 6. Paralegal fees

According to Bowater paralegal fees should not be incorporated in a feeshifting award. (Docket No. 162 at 11-12.) The plaintiffs argue that thebest policy is to permit such fees to be recovered in order to set anERISA plaintiff counsel on an equal footing as ERISA defense counsel.(Docket No. 173 at 11-12.) This Court has previously indicated itsunwillingness to award paralegal fees as part of a fee shifting award.Weinberger v. Great N. Nekoosa Corp., 801 F. Supp. 804, 822 (D.Me. 1992). I also observe that the plaintiffs have not offered anyevidence tending to support a finding that charging $60 per hour forparalegals or $75 per hour for research librarians represents a normalcommunity practice or reasonable community rate. SeeLipsett, 975 F.2d at 939 n.5. Accordingly, I would disallow all paralegal fees requested by theplaintiffs as unreasonable or, in the alternative, insufficientlysupported. This amounts to a total disallowance of $218,652.50.

7. Nonlegal work performed by an attorney

Bowater challenges hours billed by attorneys for what Bowatercategorizes as clerical (5.3 hours) or administrative (34.4 hours)functions and travel time (152.4 hours) totaling 192.1 hours. (Docket No.163 at 12-13 & Ex. A, pp. 1-4, 18-20.) The plaintiffs will concedethe 5.3 hours of clerical work. (Docket No. 173 at 11-12.) Of the 34.4hours in the administrative category, my only concern is that 22.95 hoursin the category reflect time counsel spent putting together theirretention and fee agreements. I find this amount of time to beunreasonable and would reduce it by roughly half. Thus, for these twocategories, I would disallow 16.8 hours (5.3 clerical and 11.5administrative). Finally, although I would not strike travel time fromany forthcoming award, I would reduce the hourly rate for the 152.4 hoursof travel time to $20 per hour. See Weinberger.801 F. Supp. at 824 (award $10 per hour for travel time in 1992 in theabsence of evidence that counsel was performing legal work whiletraveling).7

Accordingly, I would disallow the following: Clerical: 3.8 hours by Attorney McTeague and 1.5 hours by Attorney Case. Administrative: 1.4 hours by Attorney Case, 1.7 hours by Attorney Payne, and 8.4 hours by Attorney McTeague. Travel: 26 hours by Attorney Case, 17 hours by Attorney Payne, and 109.4 hours by Attorney McTeague, all to be billed at $20 per hour.

8. Work performed on pending fee motions Bowater argues that hours spent preparing the pending fee motionsshould be compensated at a substantially reduced rate and that hoursspent preparing the common fund attorney fee motion should not becompensated at all because filed in bad faith. (Docket No. 163 at 13-14.)The plaintiffs limit their response to the following sentence:"Plaintiffs' fee request is an inherent part of the case and timeexpended should be recognized by the Court subject, however, toreasonable limits and considering the efforts of Defendants." (Docket No.173 at 13.) Neither party itemizes these hours. Between December 30,2003, the first post-judgment billing entry regarding attorney fees, andJanuary 31, 2004, the last entry in the plaintiffs' bill, I calculate atotal of 38.9 attorney hours expended on the pending motions, 19.5 byAttorney Payne and roughly 19.4 by Attorney McTeague. I would discountthe award for this time by 50% to account for two things: (1) activityrelated to fee applications "does not require the same level of expertiseor skill as legal work related to substantive claims,"Weinberger. 801 F. Supp. at 822-23, and (2) time spent on thecommon fund fee application, which in this case appears to have beenconsiderable, would not be recoverable even if that motion weresuccessful, id. (discussing general disallowance of fees onfees in common fund cases).

Accordingly, I would disallow: 19.5 hours billed by Attorney Payne; and 19.4 hours billed by Attorney McTeague. Instead, I would allow $4279 for time spent on the fee motions, reflecting 38.9 hours at $220 per hour, reduced by 50% (as opposed to the $15,560 requested). 9. Other

Despite the foregoing disallowances, the total number of hours billedby the plaintiffs' counsel would still exceed 3600. Of these, AttorneyMcTeague posted in excess of 2300 hours. These numbers are shocking, regardless of theduration of this litigation. Although I appreciate that the number ofplaintiffs made this case burdensome, I find it unreasonable to suggestthat a competent lead attorney such a Attorney McTeague would have neededto devote an entire year's worth of professional activity to this case,on top of nearly a year's worth of work by associated counsel and morethan a year's worth of work by paralegals. In my assessment, a reasonableaward requires the Court to reduce Attorney McTeague's hours by a further350, roughly 15 percent.

Accordingly, I would disallow a further: 350 hours billed by Attorney McTeague. C. Recommended Lodestar Award

My application of the lodestar standards suggests that a reasonablestatutory fee award would be $753,474. I arrive at this amount asfollows:

Attorney Requested — Disallowed = Allowed x Rate = Award

Fongemie 0.6 0 0.6 $220 $132

Young 1.8 0.7 1.1 $220 $242

Case 646.3 247.18 399.2 $220

$87,824

McTeague 2856.7 792.9 2063.8 $250

$515,950 Payne 746 100.55 645.45 $220

$141,999

Paralegal 3633.8 3633.8 0 n/a $0

Travel 152.4 0 152.4 $20 $3048

Fee App. 38.9 19.45 19.45 $220 $42799

Lodestar Total: $753,474

I consider this amount to be a reasonable award given the relativecomplexity of this case. Although litigation was protracted, it was duein significant part to the closeness of the mootness question, not anyespecially great legal "complexity."

D. Appropriateness of an Enhancement Multiplier

The plaintiffs contend that any fee award should be enhanced by 25percent for "extraordinary result." (Docket No. 152, Motion at 1.) Intheir memorandum, they argue that an extraordinary result was reachedbecause there were several unintended beneficiaries of the suit,individuals other than those who fell within the categories described bycounts I, II and III. (Id., Memo, at 11.) In opposition,Bowater argues that an enhancement is not appropriate because the "vastbulk of efforts in this litigation addressed only the issue of whether ornot the complaint was moot" and the "results were not extraordinary."(Docket No. 162 at 15.)

In my view, the recommended award represents a reasonable attorney feefor this case. I am not of the opinion that a greater award would benecessary to ensure the availability of plaintiff counsel in cases suchas this. In sum, this is not one of the "few cases where a combination of sterling performance and exceptionalresults could conceivably justify a premium fee." Lipsett, 975F.2d at 942.

E. Expenses

In addition to the lodestar computation, Bowater challenges severalaspects of the plaintiffs' request for litigation costs (as opposed toCourt costs). (Docket No. 162 at 16 & Ex. B.) It is difficult to tellhow much of the $140,390.88 total request Bowater actually challenges.The plaintiffs, in reply, concede over $23,000 in challenged costs.(Docket No. 173, Ex. A4.) Tracking the categories identified by Bowaterin its opposition (Docket No. 162, Ex. B), I make the followingrecommendation respecting the challenged costs: Challenged Cost Recommendation 1. Postage charges of $3,891.56: Disallow. 2. Phone charges of $328: Disallow. 3. Fax transmittals of $9761: Disallow. 4. Westlaw research of $8366.71: Disallow.10 5. Duplicate attendance costs of $6026.82: Disallow. 6. Photocopy costs of $10,245.90: Disallow.11 7. Arnold & Porter $1740 tax advice: Disallow.12 8. "Vague expenses" of $11,359.14 Disallow.13 9. "Overhead" of $187.81 Disallow. 10. "Unrelated matter expense" of $991.03 Disallow.14 Total Recommended Costs Disallowance: $52,897.97 Recommended Costs Award: TBD

This recommendation is premised, in part, on a belief that the taxationof costs under ERISA § 502(g) should conform with28 U.S.C. § 1920, which does not provide for any award of costs inseveral of the identified areas. See Crawford Fitting Co. v. J.T.Gibbons. Inc., 482 U.S. 437, 444-45 (1987); People for theEthical Treatment of Animals v. Doughney, 263 F.3d 359, 370-71 (4thCir. 2001); Agredano v. Mut. of Omaha Cos. 75 F.3d 541,543-44 (9th Cir. 1995); Hall v. Ohio Educ. Ass'a 984 F. Supp. 1144,1145-46 (S.D. Ohio 1997). I have made no recommendation as to theamount of costs to be awarded as requested in Docket No. 157, a totalamount of $140,390.88, as Magistrate Judge Brownell will ultimatelyreview the Bill of Costs submitted by plaintiffs as is the practice inthis District in all such matters. However, since some limited aspects ofthe submitted Bill of Costs appear to have been addressed in thememoranda filed in conjunction with these motions, I have addressed thematters as they were presented in the papers.

Common Fund Attorney Fees

In their motion for common fund attorney fees, the plaintiffs seek, inessence, to obtain a contingency award from those plan participants whobenefited from the litigation but did not participate in the litigation.The plaintiffs premise their motion "on the grounds that a common fund orcommon funds have been created by the Plaintiffs' litigation and that allbeneficiaries should bear equitably and proportionately the attorneysfees expended to create such common fund(s)." (Docket No. 155, motion at1 — 2.) According to their memorandum in support of such an award, "Anysuch awards . . . will result in a reduction of Plaintiffs' contingentfees and thus redound entirely to the benefit of named-Plaintiffs," asopposed to their counsel. (Id., memo, at 1.) Bowater arguesthat the plaintiffs are not entitled to both statutory attorney fees andcommon fund attorney fees and that, in any event, there is no legal basisfor a common fund award under the circumstances of this case. (Docket No.161 at 1-2.)

[One] well-recognized exception to the general principle that an attorney must look to his or her own client for payment of attorney's fees is the common fund doctrine. Since the decisions in Trustees of the Internal Improvement Fund v. Greenough. 105 U.S. 527, 26 L.Ed. 1157 (1882), and Central Railroad & Banking Co. of Ga. v. Pettus. 113 U.S. 116, 28 L.Ed. 915, 5 S.Ct. 387 (1885), the Supreme Court has consistently recognized "that a litigant or a lawyer who recovers a common fund for the benefit of persons other than himself or his client is entitled to a reasonable attorney's fee from the fund as a whole." Boeing Co. v. Van Gemert 444 U.S. 472, 478, 62 L.Ed.2d 676, 100 S.Ct. 745 (1980). The doctrine reflects the traditional practice in equity, and "rests on the perception that persons who obtain the benefit of a lawsuit without contributing to its cost are unjustly enriched at the successful litigant's expense." Id. Parties as well as counsel can seek fees under the common fund doctrine, for the doctrine rests on a theory of unjust enrichment on the part of beneficiaries of a successful lawsuit at the expense of the litigants. See id.Brvtus v. Spang & Co., 203 F.3d 238, 242 (3d Cir.2000). Unlike a statutory fee-shifting provision, the common funddoctrine draws an attorney fee award from the beneficiaries of thelitigation rather than from the defendant. Id. Anotherdistinction is that common fund awards are most often in the nature of acontingent fee award, where a percentage of the common fund is awarded tothe plaintiffs or their counsel. Id. at 242-43. Finally,because the doctrine is equitable in nature, it is within a court'sdiscretion whether to make a common fund award. Id. at 244. Inmaking its determination, the Court should consider whether an inequitywould exist if the non-plaintiff beneficiaries retained the benefit of the litigation without paying a share of the plaintiffsattorney fees; whether the enrichment of the non-plaintiff beneficiariesis unjust in light of the expense ultimately borne by the plaintiffs.Id. at 245-46 (discussing Boeing. 444 U.S. at 480).

As already discussed, there is no precise way to calculate the amountof any enhancement in the benefits of the plaintiffs or the non-plaintiffbeneficiaries. The plaintiffs estimate that they alone will receiveapproximately $10.8 million in enhanced benefits as a result of thislitigation, but this estimate is supported only by their counsels'educated guesswork. (Docket No. 152 at 6; see alsoAff. of Patrick N. McTeague, Docket No. 154, ¶ 4 & Ex. 6.) Theplaintiffs indicate that due to the relatively recent closing of the GNPmills, only 286 of their 551 member group have received or will receiveenhanced benefits as a consequence of this litigation. (Docket No. 152 at5.) This is a roughly 48 percent reduction in the number of plaintiffswho benefited from this litigation. The plaintiffs estimate thatapproximately 100 non-plaintiff beneficiaries also stood to gain from thelitigation. (Docket No. 155 at 1-2.) If the mill closings impacted themsimilarly to the plaintiffs, it would leave some 52 individuals whobenefited from this litigation. Applying the plaintiffs' estimates abouttheir own enhanced benefits to the non-plaintiff beneficiaries, 52non-plaintiff beneficiaries are to 286 plaintiff beneficiaries as $1.96million is to the plaintiffs' $10.8 million estimate.15 Assuming a 25percent fee award, we would arrive at a common fund award ofapproximately $500,000. Of course, these kinds of rough estimates areentirely speculative, which is where the plaintiffs' motion for "limited"discovery comes in. In order for the Court to obtain some level orcertainty that a common fund award equitably apportioned the burden ofpaying the award among all who benefited, a considerable amount of discoverywould have to transpire and at least one more round of motions would bein order. There is no reason to think that the end result wouldnecessarily enable the Court to fashion an equitable award, either. Asthe plaintiffs point out, "some non-Plaintiffs . . . have already beenpaid litigation-enhanced lump sum pensions by Defendant Plan and itssuccessors." (Docket No. 155 at 2.) The plaintiffs do not suggest, and Ido not see, any practical means by which these non-parties canrealistically be made to turn over a pro rata portion of a common fundfee award at this juncture. Even though there may be a "common fund"remaining in the possession of the Plan consisting of the benefits thathave not already been distributed, there does not appear to be arealistic means of equitably apportioning a common fund fee award amongall of the individuals who benefited from this litigation.

Another issue is how administrable a common fund fee award would be.Because any common fund in this case would be comprised, in part, ofmoney the subject beneficiaries are not necessarily entitled to at thispoint in time, the Court's award would have to impose ongoingadministrative duties on the Plan, which would create the possibility ofongoing litigation and oversight. In other words, this case not only doesnot present a readily ascertainable common fund, it does not present areadily administrable fund. Were the Court to wade into this thicket,these concerns suggest that it would be inviting further litigationrather than resolving this litigation. Cf. Hensley v. Eckerhart461 U.S. 424, 437 (1983) (indicating in the context of statutoryfee award, "A request for attorney's fees should not result in a secondmajor litigation"). Accordingly, I recommend that the Court deny themotion for common fund attorney fees and the related discovery motion. Conclusion

For the reasons stated herein, I RECOMMEND that the CourtGRANT the plaintiffs' motion for statutory attorney fees andcosts (Docket No. 152) and award fees to the plaintiffs in the amount of$753,474 and costs as determined by the court. I RECOMMEND thatthe Court DENY all other pending fee motions. (Docket Nos. 153,154, 155.) NOTICE

A party may file objections to those specified portions of a magistrate judge's report or proposed findings or recommended decisions entered pursuant to 28 U.S.C. § 636(b)(1)(B) for which de novo review by the district court is sought, together with a supporting memorandum, within ten (10) days of being served with a copy thereof. A responsive memorandum shall be filed within ten (10) days after the filing of the objection. Failure to file a timely objection shall constitute a waiver of the right to de novo review by the district court and to appeal the district court's order.

1. The imposition of an award of attorney fees as a Rule 11 ordiscovery sanction has historically been viewed differently than arepost-judgment motions for an award of such fees. In the post-judgmentcontext, the majority of courts considering the issue have determinedthat a decision on such a motion is in the nature of a dispositive motionand therefore not a proper subject for a magistrate judge's order, asopposed to recommendation. See Blair v. Sealift,Inc., 848 F. Supp. 670 (E.D. La. 1994) (collecting cases);Insurance Co. of N. Am. v. Bath. No. 90-8083, 1992 WL 113746,1992 U.S. App. LEXIS 13504(10th Cir. May 27, 1992) (unpublishedorder).

2. The conclusory statement of Bowater's introduction reads asfollows: "In sum, Plaintiffs' motion seeks an unreasonable amount ofattorneys' fees and costs and should be substantially reduced." (DocketNo. 162 at 2.)

3. There were, in all, four counts. In the fourth count theplaintiffs alleged that the defendants had violated their fiduciary dutyto provide accurate information to Plan participants. (Second AmendedComplaint, Docket No. 39.) Count IV was dismissed for failure to state aclaim. (Docket No. 84 (recommendation); Docket No. 89 (order affirmingrecommendation).)

4. There was an intervening summary judgment motion against counts IIand III that was filed by Bowater, also on the ground of mootness. Thatmotion was denied, primarily because Bowater had not yet re-amended theplan to cure the prior, unlawful amendment. (Docket No. 83(recommendation); Docket No. 90 (order affirming recommendation).)

5. What the Seventh Circuit Court of Appeals stated inStark might be repeated here: The burden of proving the market rate is on the applicant [,] however, once the attorney provides evidence of the market rate, the burden shifts to the opposing party to show why a lower rate should be awarded. In this case, the defendants presented affidavits from attorneys in the law firms involved in this case regarding their rates. The district judge found the submissions self-serving and "precipitously close to being insufficient." The defendants were saved on this issue by statements by the defendant-companies that they paid their attorneys in full for the services rendered and by Stark's failure to adequately contest the issue.Stark, 354 F.3d at 674-75.

6. In my May 11, 2001, Order denying what amounted to a motion by theplaintiffs for further discovery, 1 indicated that the merits of counts11 and 111 remained "the primary focus of this litigation." (Docket No.85.) Nevertheless, time spent by counsel pursuing the attorney feediscovery appears to have been quite considerable.

7. The rate of $20 per hour as compared with $10 per hour in 1992reflects an inflation adjustment of between five and six percent annualincrease over 12 years.

8. Attorney Case's hours are heavily discounted because ofduplicative work, intra-office conferences, etc. (See,supra, § B.5.) Mr. Case's hours were targeteddisproportionately to Attorney McTeague's because his rate was the lowerof the two. My rationale is that, where duplicative work occurs thatought not to be duplicatively billed, it is reasonable for the attorneysto bill at the rate of that attorney whose rate is the highest amongthem.

9. See supra, ¶ B.8.

10. See Weinberger. 801 F. Supp. at 827(disallowing expense because time expended doing research already billedat attorney rate).

11. The figures provided by Bowater in its Exhibit B to itsopposition memorandum reflect a 10 cent per page allowance. Theplaintiffs reply that they would settle for 15 cents per page instead of25 cents and 35 cents as originally requested. My impression is that 10cents is more likely to approximate costs.

12. The plaintiffs have conceded this cost.

13. The plaintiffs have conceded all but $192.58. (Docket No. 173,Ex. A4, p.4.)

14. The plaintiffs have conceded all but $156.40. (Id.,p.5.)

15. The plaintiffs estimate that approximately 60 non-plaintiffs haveor will benefit to the tune of approximately two or three milliondollars. (Docket No. 152 at 10.)

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