This week, Judge Jed Rakoff of the U.S. District Court for the Southern District of New York agreed with the Competitive Enterprise Institute’s (CEI) objection to the excessive attorneys’ fees request in the $3 billion class action settlement, In re Petrobras Securities Litigation.
Attorney Anna St. John of CEI’s Center for Class Action Fairness lauded the judge’s decision to return settlement dollars to the class members:
"Judge Rakoff's decision is an important victory for class members, as it adds to an increasing judicial recognition that plaintiffs' attorneys cannot take an unfair share of the class's recovery for themselves by charging excessive billing rates for contract attorneys and attorneys not even admitted to practice in U.S. courts. This ruling adds to the growing precedent on these issues and rightfully returns nearly $100 million to the class."
According to CEI, the plaintiffs’ attorneys inflated their fees and overbilled class members for “project attorneys” earning $325-$635/hour for what is relatively risk-free litigation, following widespread government investigations. These exorbitant billing practices are similar to what launched investigations in the Anthem and State Street cases.
The original class action alleged violation of U.S. securities law by Brazil’s state-controlled oil company in connection with a multi-billion dollar bribery and kickback scheme.
ABOUT: The Competitive Enterprise Institute’s Center for Class Action Fairness represents class members against unfair class action procedures and settlements. Originally founded by Ted Frank in 2009, the center has secured millions of dollars for consumers and shareholders and won landmark precedents that safeguard consumers, investors, and the courts.