Oklahoma Firefighters Pension and Retirement System v. Lexmark International, Inc.

1 UNITED STATES DISTRICT COURT 2 SOUTHERN DISTRICT OF NEW YORK 3 : OKLAHOMA FIREFIGHTERS PENSION : AND RETIREMENT SYSTEM, : Individually and on Behalf of All Others : Similarly Situated, : : 17cv5543 Plaintiff, : : MEMORANDUM & ORDER -against- : : LEXMARK INTERNATIONAL, INC., : PAUL A. ROOKE, DAVID REEDER, and : GARY STROMQUIST, : : Defendants. : : 4 5 WILLIAM H. PAULEY III, Senior United States District Judge: 6 7 Lead Plaintiff Oklahoma Firefighters Pension and Retirement System (“Lead 8 Plaintiff”), on behalf of itself and the other members of the class, moves for final approval of its 9 proposed settlement with Defendants (the “Proposed Settlement”) and the proposed Plan of 10 Allocation. (ECF No.136.) In addition, Robbins Geller Rudman & Dowd LLP (“Robbins 11 Geller”) and Labaton Sucharow LLP (“Labaton,”together with Robbins Geller, “LeadCounsel”) 12 move for an award of attorneys’ fees and expenses. (ECF No. 138.) For the reasons that follow, 13 the motion for final approval of settlement is granted and the motion for an award of attorneys’ 14 fees and expenses is granted in part and denied in part. 15 BACKGROUND 16 This putative classaction was filed on July 20, 2017. (ECF No. 1.) Thereafter, 17 the parties briefed—and this Court resolved—a motion to dismiss the amended consolidated 18 complaint. See Okla.Firefighters Pension & Retirement Sys. v. Lexmark Int’l, 367 F. Supp. 3d 1 16 (S.D.N.Y. 2019). The parties conducted extensive document discovery,and in August 2019, 2 Lead Plaintiff moved for class certification,(ECF No. 99). After engaging inmediation, the 3 parties reached an agreement to resolve this litigation. (ECF No. 122.) On June 17, 2020, this 4 Court preliminarily approved the settlement and permitted notice to the class. (ECF No. 126.) 5 The settlement funds were deposited into a Court Registry Investment System (“CRIS”) account. 6 (ECF No. 128.) 7 The Proposed Settlement resolves the entire litigation for a cash payment of $12 8 million. (ECF No. 122.) No objections have been lodged. (ECF No. 147.) In addition, Lead 9 Counsel seeks attorneys’ fees in the amount of 25% of the settlement fund ($3 million), plus 10 $201,357.78 inlitigation expenses, as well as a $2,500 reimbursement toLead Plaintiff as class 11 representative. (ECF No. 139.) 12 DISCUSSION 13 I. Settlement Approval 14 There is a “strong judicial policy in favor of settlements, particularly in the class 15 action context.” Wal-Mart Stores, Inc. v. Visa U.S.A., Inc., 396 F.3d 96, 116 (2d Cir. 2005) 16 (quotation marks omitted). However, a court must “carefully scrutinize the settlement to ensure 17 its fairness, adequacy and reasonableness, and that it was not the product of collusion.” 18 D’Amato v. Deutsche Bank, 236 F.3d 78, 85 (2d Cir. 2001) (citation omitted). Under this two- 19 part inquiry, a court “must determine whether both the negotiating process leading to a 20 settlement and the settlement itself are fair, adequate, and reasonable.” In re Currency 21 Conversion Fee Antitrust Litig., 263 F.R.D. 110, 122 (S.D.N.Y. 2009). In other words, the 22 settlement must be both procedurally and substantively fair. In re Virtus Inv. Partners, Inc. Sec. 23 Litig., 2018 WL 6333657, at *1 (S.D.N.Y. Dec. 4, 2018). 1 With respect to procedural fairness, the “[n]egotiation of a settlement is presumed 2 fair when the settlement is ‘reached in arm’s length negotiations conducted by experienced, 3 capable counsel after meaningful discovery.’” Dial Corp. v. News Corp., 317 F.R.D. 426, 430 4 (S.D.N.Y. 2016) (quoting Wal-Mart, 396 F.3d at 116). Indeed, “‘great weight’ is accorded to the 5 recommendations of counsel, who are most closely acquainted with the facts of the underlying 6 litigation.” In re PaineWebber Ltd. P’ships Litig., 171 F.R.D. 104, 125 (S.D.N.Y. 1997); accord 7 City of Providence v. Aeropostale, Inc., 2014 WL 1883494, at *5 (S.D.N.Y. May 9, 2014). 8 Moreover, where a settlement is reached “under the supervision and with the endorsement of a 9 sophisticated institutional investor,” it “is entitled to an even greater presumption of 10 reasonableness.” In re Hi-Crush Partners L.P. Sec. Litig., 2014 WL 7323417, at *5 (S.D.N.Y. 11 Dec. 19, 2014) (quotation marks omitted). Given that the Proposed Settlement was the product 12 of arm’s length negotiations between experienced counsel and created under the supervision ofa 13 sophisticated investor, the Proposed Settlement is procedurally fair. 14 To determine substantive fairness, courts consider the factors set forth in City of 15 Detroit v. Grinnell Corp.: 16 (1) the complexity, expense, and likely duration of the litigation; (2) 17 the reaction of the class to the settlement; (3) the stage of the 18 proceedings and the amount of discovery completed; (4) the risks of 19 establishing liability; (5) the risks of establishing damages; (6) the 20 risks of maintaining the class action through trial; (7) the ability of 21 the defendants to withstand greater judgment; (8) the range of 22 reasonableness of the settlement fund in light of the best possible 23 recovery; and (9) the range of reasonableness of the settlement fund 24 to a possible recovery in light of all the attendant risks of the 25 litigation. 26 27 Pa. Pub. Sch. Emps.’ Ret. Sys. v. Bank of Am. Corp., 318 F.R.D. 19, 24 (S.D.N.Y. 2016) (citing 28 City of Detroit v. Grinnell, 495 F.2d 448, 463 (2d Cir. 1974),abrogated on other grounds by 29 Golberger v. Integrated Res., Inc., 209 F.3d 43 (2d Cir. 2000)); accordWal-Mart, 396 F.3d at 1 117. “[N]ot every factor must weigh in favor of settlement, rather the court should consider the 2 totality of these factors in light of the particular circumstances.” Dial Corp., 317 F.R.D. at 431 3 (quotation marks omitted) (alteration in original). 4 A. Complexity, Expense, and Likely Duration of the Litigation 5 “As a general rule, securities class actions are notably difficult and notoriously 6 uncertain to litigate.” In re Facebook, Inc. IPO Sec. & Derivative Litig., 2015 WL 6971424, at 7 *3 (S.D.N.Y. Nov. 9, 2015); see alsoBank of Am. Corp., 318 F.R.D. at 24. Such is the case 8 here, where expert testimony would have been required with respect to falsity, materiality, 9 scienter, loss causation, and damages. As such, this factor strongly counsels in favor of 10 approval. 11 B. Reaction of the Class to the Settlement 12 It is well settled that “the reaction of the class to the settlement is perhaps the 13 most significant factor to be weighed in considering its adequacy.” In re Facebook, Inc., IPO Sec. 14 & Derivative Litig.,343 F. Supp. 3d 394, 410 (S.D.N.Y. 2018) (quotationmarks omitted). And 15 “the absence of objections by the class is extraordinarily positive and weighs in favor of 16 settlement.” Dial Corp., 317 F.R.D. at 431 (quotation marks omitted); accordBank of Am. Corp., 17 318 F.R.D. at 24. Here, no class members objected or opted out, which strongly favors approval. 18 C. Stage of the Proceedings and the Amount of Discovery Completed 19 The parties briefed—and this Court decided—a motion to dismiss. (ECF Nos. 66, 20 71, 78.) They also completed document discovery,and Plaintiff moved for class certification, 21 (ECF No. 99.). Thus,“a substantial amount of work had been completed” prior to settlement 22 negotiations. Wal-Mart, 396 F.3d at 118. The significant litigation prior to the proposed 23 settlement favors approval. 1 D. Risks of Establishing Liability and Damages and of Maintaining the Class 2 Through Trial 3 4 “Courts generally consider the fourth, fifth, and sixth Grinnell factors together.” 5 Dial Corp., 317 F.R.D. at 432. With respect to establishing liability, there was a substantial 6 question regarding whether Plaintiffs could prove misrepresentation, loss causation, and scienter. 7 While Lead Plaintiff submitted a damages expert report onits motion for class certification, 8 (ECF No. 100, Ex. C),Defendants would have likely offered an expert of their own. 9 Accordingly, the risk in establishing damages was real and counsels in favor of approving the 10 settlement. See Dial Corp., 317 F.R.D. at 432 (“Plaintiffs would have encountered additional 11 challenges to proving damages given the parties’dueling expert reports.”). Moreover, “[a]s with 12 any complicated securities action, the class faced the very real risk that a jury could be swayed 13 by experts . . . whocould minimize or eliminate the amount of Plaintiffs’ losses.” Bank of Am. 14 Corp., 318 F.R.D. at 24 (quotation marks omitted). Finally, the fact that Lead Plaintiff’s motion 15 for class certification had not been fully briefed—let alone decided—presented additional risks 16 to Lead Plaintiff and the proposed class. Overall, these factors counsel in favor of approving the 17 settlement. 18 E. Ability of Defendants to Withstand a Greater Judgment 19 Lead Plaintiff concedes that Defendants can withstand a greater judgment in 20 excess of the settlement amount. (ECF No. 137, at 14.) However, Lead Plaintiff also avers that 21 Defendant’s liability insurance policy was diminishing throughout the course of the litigation. 22 (ECF No. 137, at 14–15.) Defendants have not confirmed this fact and, at this stage, have no 23 incentive to deny it. SeeHart v. BHH, LLC, 2020 WL 5645984, at *4 (S.D.N.Y. Sept. 22, 24 2020). 25 Nevertheless, “while relevant to settlement approval, the ability of defendants to 1 withstand greater judgment does not alone suggest the settlement is unfair or unreasonable.” In 2 re Facebook, 2015 WL 6971424, at *5; see alsoD’Amato, 236 F.3d at 86 (“[T]his factor, 3 standing alone, does not suggest that the settlement is unfair.”). 4 F. The Range of Reasonableness of the Settlement Fund in Light of the Best 5 Possible Recovery and All the Attendant Risks of the Litigation 6 7 “The final two Grinnellfactors are typically considered together.” Dial Corp., 8 317 F.R.D. at 432. Here, the $12 million settlement is approximately 10% of $116.8 million, 9 which is Lead Plaintiff’s estimated damages consistent with the Plan of Allocation. Moreover, if 10 this Court were to credit Defendants’ anticipated attempt to reduce the class period by moving 11 the start date from August 1, 2014 to June 16, 2015, the maximum potential recovery would be 12 $31.5 million. Under this formulation, $12 million would be approximately 38% of the potential 13 recovery. But “[t]he fact that the settlement amount may equal but a fraction of potential 14 recovery does not render the settlement inadequate. Dollar amounts are judged not in 15 comparison with the possible recovery in the best of all possible worlds, but rather in light of the 16 strengths and weaknesses of plaintiffs’ case.” In re Facebook, 2015 WL 6971424, at *6. Given 17 the risks of proving loss causation, the recoverable damages were unlikely to be anywhere close 18 to $116.8 million. See Dura Pharms., Inc. v. Broudo, 544U.S. 336, 339(2005). 19 While this settlement ishardlya windfall for Plaintiffs, it is within the range 20 previously approved by judges in this District. See, e.g.,In re Bear Stearns Cos. Sec., 21 Derivative, & ERISA Litig., 909 F. Supp. 2d 259, 269 (S.D.N.Y. 2012) (approving settlement 22 amounting to 11% of estimated damages); In re Canadian Superior Sec. Litig., 2011 WL 23 5830110, at *4 (S.D.N.Y. Nov. 16, 2011) (approving settlement worth 8.5% of maximum 24 amount of estimated damages); In re Merrill Lynch Tyco Research Sec. Litig., 249 F.R.D. 124, 25 135 (S.D.N.Y. 2008) (approving settlement worth approximately 3% of total estimated 1 damages). Ultimately, there is no indication that the Proposed Settlement is anything but the 2 result of an arm’s length negotiation. In view of the riskof litigation and the estimated recovery, 3 the $12 million settlement fund is reasonable. 4 G. Aggregation of All Factors 5 Overall, the Grinnell factors counsel in favor of approving the Proposed 6 Settlement. No one has objected or opted out, and this action was contested at each stage of the 7 litigation. And Plaintiffs faced substantial risk in proving misrepresentation, scienter, and loss 8 causation. Accordingly, this Court approves the Proposed Settlement. 9 II. Plan of Allocation 10 “The standard for approval of a planof allocation is the same as the standard for 11 approving a settlement: namely, it must be fair and adequate.” In re Top Tankers, Inc. Sec. 12 Litig., 2008 WL 2944620, at *11 (S.D.N.Y. July 31, 2008) (quotation marks omitted). “[I]n 13 determining whether a plan of allocation is fair, courts look primarily to the opinion of counsel.” 14 In re Giant Interactive Grp., Inc. Sec. Litig., 279 F.R.D. 151, 163 (S.D.N.Y. 2011) (quotation 15 marks omitted); see alsoIn re Top Tankers, 2008 WL 2944620, at *11 (“If the planofallocation 16 is formulated by competent and experienced class counsel, an allocation plan need only have a 17 reasonable, rational basis.” (quotation marks omitted)). Here, the Plan of Allocation—which 18 was developed byLeadCounsel—is based on the level of artificial inflation in Lexmark’s 19 common stock price during the Class Period. Moreover, the Plan of Allocation apportions the 20 net settlement fund among Authorized claimants based on the claims alleged. Because the Plan 21 of Allocation appears fair and adequate and comes by the recommendation of experienced Class 22 Counsel, it is approved. 23 1 III. Notice 2 “The standard for the adequacy of a settlement notice in a class action under 3 either the Due Process Clause or the Federal Rules is measured by reasonableness.” Wal-Mart, 4 396 F.3d at 113. The Second Circuit explains that: 5 There are no rigid rules to determine whether a settlement notice to 6 the class satisfies constitutional or Rule 23(e) requirements; the 7 settlement notice must fairly apprise the prospective members of the 8 class of the terms of the proposed settlement and of the options that 9 are open to them in connection with the proceedings. Notice is 10 adequate if it may be understood by the average class member. 11 12 Wal-Mart, 396 F.3d at 114 (quotation marks and citation omitted). 13 The Settlement Notice is reasonable. The Court preliminarily approved the notice 14 plan. (ECF No. 126, at 4.) As of December 5, 2020, more than 32,500 copies of the Notice 15 Packet weremailed to all class members who could be identified with reasonable effort. (Decl. 16 of Eric Nordskog in Supp. Of Mot. for Attorneys’ Fees, ECF No. 142(“Nordskog Decl.”), at 3.) 17 Additionally, Summary Notice was published in The Wall Street Journal and over PRNewswire 18 on July 13, 2020. (Nordskog Decl., at 3.) Finally, the Notice Packet and other important 19 documents were posted on the website maintained for the Settlement: 20 www.LexmarkSecuritiesSettlement.com. (Nordskog Decl., at 3.) The Settlement Notice also set 21 forth the amount of settlement, maximum amount of attorneys’ fees and expenses sought, rights 22 to object, dates and deadlines, and the Plan of Allocation. (Nordskog Decl., Exhibit A, at 3.) 23 This Court approves the Settlement Notice. 24 IV. Attorneys’ Fees 25 In a class action settlement, courts must carefully scrutinize lead counsel’s 26 application for attorneys’ fees to “ensure that the interests of the class members are not 27 subordinated to the interests of . . . class counsel.” Maywalt v. Parker & Parsley Petroleum Co., 1 67 F.3d 1072, 1078 (2d Cir. 1995). A court’s role in this context is “to act as a fiduciary who 2 must serve as a guardian of the rights of absent class members.” McDaniel v. Cty. Of 3 Schenectady, 595 F.3d 411, 419 (2d Cir. 2010). The trend in the Second Circuit is to assess a fee 4 application using the “percentage of the fund” approach, which “assigns a proportion of the 5 common settlement fund toward payment of attorneys’ fees.” Dial Corp., 317 F.R.D. at 433. As 6 a “cross-check on the reasonableness of the requested percentage,” however, courts also look to 7 the lodestar multiplier, which should be a reasonable multiple of the total number of hours billed 8 at a standard hourly rate. Goldberger, 209 F.3d at 53. And regardless of which method is used, 9 courts rely on the factors set forth in Goldbergerto determine whether fees are reasonable. Wal- 10 Mart, 396 F.3d at 121. 11 A. Percentage of the Fund 12 Here, Class Counsel seeks 25% of the settlement fund ($12 million) in attorneys’ 13 fees. In assessing reasonable percentages of settlement funds, courts have“cabined awards to 14 between 12% and 28%” for “class action settlements ranging from $15 million to $336 million.” 15 Dial Corp.317 F.R.D. at 436, 438 (awarding fees representing 20% of a $244 million settlement 16 fund); see alsoIn re Facebook,343 F. Supp. 3d at 418(approving 25% of a $35 million 17 settlement fund); Bank of Am. Corp., 318 F.R.D. at 27 (allowing fees representing 12% of a 18 $335 million settlement fund); In re Platinum & Palladium Commodities Litig., 2015 WL 19 4560206, at *5 (S.D.N.Y. July 7, 2015) (awarding fees representing 22.5% of the $72.5 million 20 fund); In re Bayer AG Sec. Litig., 2008 WL 5336691, at *2, *6 (S.D.N.Y. Dec. 15, 2008) 21 (approving 12% of an $18.5 million settlement fund); In re Polaroid ERISA Litig., 2007 WL 22 2116398, at *3 (S.D.N.Y. July 19, 2007) (approving 28% of a $15 million settlement fund). 23 Whilea fee award of 25% of the settlement fundis withinthe range of awards previously 1 approved by courts in this District,itis on the higher end. 2 B. Lodestar Cross Check 3 The lodestar is “the product of a reasonable hourly rate and the reasonable 4 number of hours required by the case.” Millea v. Metro-North.R. Co., 658 F.3d 154, 166 (2d 5 Cir. 2011). Here,Lead Counsel spent about 4,581 attorney and professional support hours on 6 this litigation, leading toa lodestar of $3,011,766.00. (Decl.of Robert Robbins in Supp. of Mot. 7 for Attorneys’ Fees, ECF No. 143 (“Robbins Decl.”), Ex. A; Decl. of Christine Fox in Supp.of 8 Mot. for Attorneys’ Fees, ECF. No.144(“Fox Decl.”), Ex. A.) This amounts to a lodestar 9 multiplier of 0.996, whichis below multipliers previously approved by this Court. See Bank of 10 Am. Corp., 318 F.R.D. at 27 (1.2 lodestar multiplier); Dial Corp., 317 F.R.D. at 437 (1.75 11 lodestar multiplier); In re Platinum & Palladium, 2015 WL 4560206, at *3 (1.4 lodestar 12 multiplier). 13 However, Lead Counsel’s lodestar raises several issues. First, the allocation of 14 time is heavily weighted toward partners. Of the 32 attorneys whobilled, 16 were partners. 15 (Robbins Decl., Ex. A; Fox Decl., Ex. A.) Those 16 partners accounted for nearly 47% of the 16 hours billedby Lead Counsel. (Robbins Decl., Ex. A; Fox Decl., Ex. A.) Moreover, the hourly 17 rates for some partners were higher than any hourly rates this Court has previously seen. 18 Specifically, 5 of the 16 partners who billedhad hourly rates exceeding$1,000, and the rate for 19 two of them exceeded $1,300 per hour. (Robbins Decl., Ex. A; Fox Decl., Ex. A.) Lead Counsel 20 asserts that the more expensive partners were used primarily in an advisory role, but this 21 explanation is insufficient.1 (Tr. of Fairness Hearing, ECF No. 156, at 8–9.) Further,the hourly 1 It is generally helpful for counsel to submit contemporaneous, detailed time records as part oftheir initial motion for attorneys’ fees. SeeWilliam B. Rubenstein, 5 Newberg on Class Actions§ 15:6(5th ed.2020). A court should not have to request billing records. 1 rates for Lead Counsel’s associates were high, and the rates for 5 associates exceeded $600 per 2 hour. (Robbins Dec., Ex. A; Fox Decl., Ex. A.) Finally, Lead Counsel billed a summer associate 3 on the litigation, which is a practice this Court has never seen. (Robbins Decl., Ex. A.) 4 Given the partner-heavy billing,the high rates for several partners and associates, 5 and the billing of a summer associate,a modest reduction of Lead Counsel’s requested attorneys’ 6 fee is warranted. See In re Platinum & Palladium Commodities Litig., 2015 WL 4560202, at *4 7 (“Courts have reduced the fee percentage requested where, as here, the lodestar value reflects an 8 over-allocation of work to more expensive partners.”). 9 C. Goldberger Test 10 Regardless of which method is used, courts rely on the factors set forth in 11 Goldbergerto determine whether fees are reasonable: (1) the time and labor expanded by 12 counsel; (2) the magnitude and complexities of the litigation; (3) the risk of the litigation; (4) the 13 quality of representation; (5) the requested fee in relation to the settlement; and (6) public policy 14 considerations. Wal-Mart, 396 F.3d at 121 (citingGoldberger, 209 F.3d at 50). There is no 15 “one-size-fits-all ‘benchmark’ in determining the appropriate fee”—in fact, courts should avoid 16 that practice because it “could easily lead to routine windfall where the recovered fund runs into 17 the multi-millions.” In re Visa Check/Mastermoney Antitrust Litig., 297 F. Supp. 2d 503, 521 18 (E.D.N.Y. 2003). 19 i. Time and Labor Expanded by Counsel 20 While many class actions are filed on the heels of a government investigation, the 21 claims in this case were formulated entirely from the findings of a private investigation. See In 22 re Gulf Oil/Cities Serv. Tender Offer Litig., 142 F.R.D. 588, 597 (S.D.N.Y. 1992) (“[T]his is not 23 a case where plaintiffs’ counsel can be cast as jackals to the government’s lion, arriving on the 1 scene after some enforcement or administrative agency has made the kill. They did all the work 2 on their own.”). Here,Lead Counsel worked through a motion to dismiss, document discovery, a 3 motion for certification, mediation, and settlement negotiations. 4 However, as discussed previously, Lead Counsel’s time charges were partner- 5 heavyand atthe top of hourly rates charged in securities actions in this District. Accordingly, 6 this factor militates in favor of some reduction of the requested award. 7 ii. Magnitude and Complexities of the Litigation 8 Courts have recognized that shareholder actions are notoriously complex and 9 difficult to prove. See Mathes v. Roberts, 85 F.R.D. 710, 713 (S.D.N.Y. 1980). This action 10 involved a number of difficult and complex questions concerning loss causation and damages. 11 iii. Risk of Litigation 12 “Perhaps the foremost . . . factor[] is the attorney’s risk of litigation, i.e., the fact 13 that, despite the most vigorous and competent of efforts, success is never guaranteed.” Grinnell 14 Corp., 495 F.2d at 471 (quotation marks omitted). Courts in this district have noted that 15 significant litigation risks, including the difficulty of establishing loss causation in light of the 16 Supreme Court’s decision in Dura Pharms., Inc. v. Broudo, 544U.S. 336 (2005), and the 17 difficulty in proving that Defendants acted with scienter, militate in favor of fee awards. See In 18 re Veeco Instruments Inc. Sec. Litig., 2007 WL 4115808, at *6 (S.D.N.Y. Nov. 7, 2007). 19 Although Lead Counsel withstood a motion to dismiss, it faced substantial risk in establishing 20 scienter, as well as proving causation and damages at trial. 21 iv. Quality of Representation 22 The results achieved through the efforts of Lead Counsel are a “critical element in 23 determining the appropriate fee to be awarded,” and the settlement here will undoubtably have 1 widespread benefits to the class. Maley v. Del Global Techs. Corp., 186 F. Supp. 2d 358, 373 2 (S.D.N.Y. 2002). Lead Counsel provided high-quality representation in securing an 3 advantageous settlement for the class. 4 v. Requested Fee in Relation to Settlement 5 As discussedpreviously, the proposed fee of 25% of the Settlement, while within 6 the wide range of fee awards in this District, is on the higher end. See, e.g.,Sakiko Fujiwara v. 7 Sushi Yasuda Ltd., 48 F. Supp. 3d 424 (S.D.N.Y. 2014) (awarding 20% of $2.4 million 8 settlement as fees); McGreevy v. Life Alert Emergency Response, Inc., 258 F. Supp. 3d 380 9 (S.D.N.Y. 2017) (awarding 21.5% of a $3.3 million settlement fund); In re Platinum & 10 Palladium Commodities Litig., 2015 WL 4560206 (awarding 22.5% of a $72.5 million fund). 11 vi. Public Policy Considerations 12 While public policy favors “the award of reasonable attorney’s fees,” courts must 13 also “guard against providing a monetary windfall to class counsel to the detriment of the 14 plaintiff class.” In re NTL Inc. Sec. Litig., 2007 WL 1294377, at *8 (S.D.N.Y. May2, 2007) 15 (quotation marks omitted). 16 Applying the Goldberger factorsand recognizing that a modest adjustment is 17 appropriate, this Court awards a total attorneys’ fee of $2,880,000, which represents 24% of the 18 Settlement Fund. These attorneys’ fees may be disbursed from the CRIS account once 75% of 19 the net settlement fund2 has been distributed. SeeBank of Am., 318 F.R.D. at 28; Beane v. Bank 20 of N.Y. Mellon, 2009 WL 874046, at *9 (S.D.N.Y. Mar. 31, 2009). 21 2 The estimated net settlement fund is $8,743,641.22, which represents the remainder after attorneys’ feesof $2,880,000, litigation expenses of $201,358.78, reimbursementaward of $2,500, 2020 tax filing fee of $2,500, and the Claims Administrator’s estimated fees and expenses ofapproximately $170,000. 1 V. Litigation Expenses 2 “In class action settlements, [a]ttorneys may be compensated for reasonable out- 3 of-pocket expenses incurred and customarily charged to their clients. When the ‘lion’s share’ of 4 expenses reflects the typical costs of complex litigation such as experts and consultants, trial 5 consultants, litigation and trial support services, document imaging and copying, deposition 6 costs, online legal research, and travel expenses, courts should not depart from the common 7 practice in this Circuit of granting expense requests.” Bank of Am. Corp., 318 F.R.D. at 27 8 (quotation marks omitted). 9 Here, Lead Counsel seeks $201,358.78 in litigation expenses, which is below the 10 $300,000 Lead Counsel informed the class they might apply for in the Settlement Notice. 11 (Nordskog Decl., Ex.A, at 3.) The bulk of expenses were for Plaintiffs’ damage expert, 12 accounting for over $126,000. (Robbins Decl., Ex. B.) This Court finds Lead Counsel’s 13 expense request reasonable and approves it. 14 VI. Reimbursement for Class Representative 15 Under 15 U.S.C. §78u-4(a)(4), a class representative may be reimbursed for 16 “reasonable costs and expenses (including lost wages) directly relating to the representation of 17 the class.” “These awards compensate lead plaintiffs for the substantial time and effort the class 18 representatives incurred, including written discovery, being disposed, reviewing and editing 19 submissions, and attending hearings.” Bank of Am. Corp., 318 F.R.D. at 27 (quotation marks 20 omitted). Courts typically require an affidavit demonstrating a “thorough accounting of hours 21 dedicated to the litigation and a statement that these hours constituted lost work time.” In re 22 Bank of Am. Corp. Sec., Derivative, & Emp. Ret. Income Sec. Act (ERISA) Litig., 772 F.3d 23 125, 133 (2d Cir. 2014). 1 Lead Plaintiff’ s request for reimbursement of $2,500 represents 0.02% of the Settlement Fund, which is well within the range of reasonableness. See Bank of Am. Corp., 318 3 E.R.D. at 27 (awarding expenses amounting to 0.01% of the fund); see In re Currency 4 Conversion, 263 F.R.D. at 131 (award representing approximately 0.1% of the fund). 5 Accordingly, this Court approves that request. 6 CONCLUSION 7 For the foregoing reasons, the motion for final approval of the settlement is 8 granted and the motion for an award of attorneys’ fees and expenses is granted in part and denied 9 inpart. The Proposed Settlement, the Plan of Allocation, and the Settlement Notice are 10 approved. In addition, Lead Counsel is awarded attorneys’ fees in the amount of $2.88 million, representing 24% of the Settlement Fund. These attorneys’ fees may be disbursed from the 12. CRIS account once 75% of the net settlement fund has been distributed. Moreover, Lead 13. Counsel may be reimbursed $201,357.78 in litigation expenses forthwith. Finally, Lead Plaintiff 14 may be reimbursed $2,500 forthwith. The Clerk of Court is directed to terminate all pending motions and to mark this case closed. 16 Dated: January 7, 2021 SO ORDERED: 17 New York, New York S Joos SA 825 WILLIAM H. PAULEY III U.S.D.J. 15