At Trial Firms, Extraordinary Payouts Cover Ordinary Expenses
Law.com discusses attorney fees in class action settlements with CEI's Center for Class Action Fairness's Ted Frank.
One frequent critic of attorney fees in class action settlements, Ted Frank of the Center for Class Action Fairness, said he disagrees with the idea that fees are divvied up based on the work a particular firm does.
Instead, he said, there’s “a lot of horse trading” that goes on among plaintiffs lawyers, in firms vying for a lead counsel position negotiate some sort of trickle-down fee arrangement with other plaintiffs firms that end up lower on the pecking order. From Frank’s perspective, those side deals often lead to windfalls for plaintiffs lawyers in leadership slots, while the case could have been handled – more cheaply – by firms that are cut out of the leadership.
“My understanding,” Frank said, “is that deals are cut [among plaintiffs lawyers] at the front to minimize competition for the lead counsel role. And nobody wants to challenge that because it’s always more profitable to go along and get paid off.”
Read the full article at Law.com.