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Edwards v. Alaska Pulp Corporation (6/28/96), 920 P 2d 751
Notice: This opinion is subject to formal correction before
publication in the Pacific Reporter. Readers are requested to bring
errors to the attention of the Clerk of the Appellate Courts, 303 K
Street, Anchorage, Alaska 99501, telephone (907) 264-0607, fax (907)
THE SUPREME COURT OF THE STATE OF ALASKA
LARRY EDWARDS, Individually )
and on Behalf of Others )
Similarly Situated, )
) Supreme Court No. S-6990
) Superior Court No.
) 1JU-94-1825 Civil
) O P I N I O N
ALASKA PULP CORPORATION, and )
ALASKA PULP COMPANY, LTD., )
) [No. 4362 - June 28, 1996]
Appeal from the Superior Court of the State of
Alaska, First Judicial District, Juneau,
Larry R. Weeks, Judge.
Appearances: James W. McGowan, Sitka, and
Peter R. Ehrhardt, Robinson, Beiswenger &
Ehrhardt, Soldotna, for Appellant. Denton J.
Pearson, Pearson & Hanson, Sitka, and Richard
A. Kramer, Steefel, Levitt & Weiss, San
Francisco, California, for Appellee Alaska
Pulp Corporation. James F. Clark, Robertson,
Monagle & Eastaugh, Juneau, for Appellee
Alaska Pulp Company, Ltd.
Before: Compton, Chief Justice, Matthews,
Eastaugh and Fabe, Justices. [Rabinowitz,
Justice, not participating.]
This appeal is brought by plaintiffs who settled a class
action suit for private nuisance against a Sitka pulp mill.
Plaintiffs sought $1 million in attorney's fees under the common
fund doctrine. The trial court declined to apply the common fund
doctrine, apparently concerned that it conflicts with Alaska Civil
Rule 82. Applying Rule 82, the court awarded only $500,000 to
plaintiffs' counsel, and plaintiffs appeal that award. We reverse
the judgment of the superior court and remand the case for
determination of a reasonable attorney's fee award under the common
II. FACTS AND PROCEEDINGS
In February 1992, Larry Edwards, representing a class of
shoreline property owners, sued the Alaska Pulp Corporation (APC)
and its parent company for nuisance. Edwards complained about
discharges into air and water from the defendants' Sitka pulp mill.
The plaintiff class was represented by an attorney from
Sitka, as well as law firms from Soldotna; Burlington, Vermont; and
Washington, D.C. The plaintiffs retained their counsel under a 33
1/3% contingency fee arrangement.
The parties litigated the case vigorously for several
years before it settled. The parties contested a number of
pretrial matters, including the addition of APC's parent
corporation as a defendant, class certification and an unsuccessful
motion for decertification, a successful motion for change of venue
from Juneau to Sitka, an initially unsuccessful motion for change
of venue out of Sitka, and a change of venue from Sitka to Juneau
based on responses to the jury questionnaire in Sitka. The parties
engaged in pretrial discovery involving over 100,000 pages of
documents, eighty depositions, and several disputes over the
adequacy and confidentiality of responses. The defendants made
several motions for summary judgment, all of which were denied
completely or in part. The plaintiffs successfully challenged the
constitutionality of a new statute that would have retroactively
barred the suit.
APC closed its pulp mill on September 30, 1993. In
September 1994, before trial began in Juneau, the parties reached
a settlement agreement. The agreement required APC to establish a
Sitka Alaska Permanent Charitable Trust (the Trust) to support
educational and charitable activities in Sitka. APC was to provide
$3 million to fund the Trust, making an initial payment of $2
million followed by five annual installments of $200,000. The
agreement stated that "[i]n no event shall any member of the class
be entitled to receive any payment from the Settlement."
The settlement agreement allowed the plaintiffs' counsel
to apply to the court for attorney's fees and costs "in accordance
with Alaska Rules [sic] of Civil Procedure 23,"and provided that
any fees and costs awarded to plaintiffs' counsel would be paid out
of the Trust, to a maximum of $270,000 in costs and $1 million in
fees. The agreement further limited funding for attorney's fees
and costs to no more than half of the initial endowment and
subsequent net income of the Trust.
Following the settlement, the plaintiffs' attorneys
applied to the superior court for $1 million of fees under the
common fund doctrine. In response, the defendants urged that under
Alaska Civil Rule 82, counsel for the plaintiffs should receive
either nothing, because they were not the prevailing party, or
Counsel for the plaintiffs calculated the value of their
legal work at over $1.7 million; plaintiffs' counsel also incurred
$285,000 in costs. By comparison, the defendants incurred legal
fees of $3.4 million, in addition to $1.07 million in costs. The
superior court found that both the hourly rate and the time spent
on the case by plaintiffs' counsel were reasonable, in light of the
complexity of the case and the quality of their work. The court
noted that "[t]he number of lawyers plaintiffs used"limited costs,
as did "[t]he plaintiffs['] refusal to depose numerous witnesses."
The court implicitly held that Rule 82 and not the common fund
doctrine applied to the award of attorney's fees in the case:
The court finds that a federal court
applying the common fund benefit doctrine or
the lodestar method and Federal Rule of Civil
Procedure 23(b), might well award attorney's
fees to Counsel in at least the amount Counsel
are requesting. It would be inequitable not
to award attorney's fees, where a Trust Fund
is generated for the benefit of an
However, the common fund benefit doctrine
is more liberal in granting prevailing party
status than Alaska Civil Rule 82. Hickel v.
Southeast Conference, 868 P.2d at 925 ("Unlike
Alaska's approach, the federal approach is
extremely generous in granting prevailing
Finding that the plaintiffs were the prevailing parties
and that under Rule 82(b)(3) the length and complexity of the
litigation justified a departure from the scheduled amount of
$84,500, the court relied upon Rule 82 in awarding $500,000 in
attorney's fees, as well as $270,000 in costs, to the plaintiffs'
Counsel for the plaintiffs appeal the fee award. They
claim that Rule 23, not Rule 82, governs attorney's fees in this
case and that the superior court should have applied the common
fund doctrine to provide full reasonable attorney's fees. Under
the common fund doctrine, they claim, the court should have
employed the lodestar method of calculating fees, which entitles
them to $1 million, the amount of the settlement cap on attorney's
A. The Common Fund Doctrine Applies in Alaska.
The first question before us is whether the common fund
doctrine is part of Alaska law. (EN2) That doctrine holds 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 (1980). (EN3) The United States
Supreme Court established the doctrine in the 1880s. Trustees v.
Greenough, 105 U.S. 527 (1881); Central R.R. & Banking Co. v.
Pettus, 113 U.S. 116 (1885). (EN4)
One rationale underlying the doctrine is the prevention
of unjust enrichment. As explained by the United States Supreme
Court, "persons who obtain the benefit of a lawsuit without
contributing to its cost are unjustly enriched at the successful
litigant's expense." Boeing, 444 U.S. at 478. One court has
described such litigants as "free riders." La Raza Unida v. Volpe,
57 F.R.D. 94, 97 (N.D. Cal. 1972). Another rationale which
supports the doctrine is quantum meruit. See In re San Juan Dupont
Plaza Hotel Fire Litig., 768 F. Supp. 912, 924 & n.43 (D.P.R.
1991), vacated on other grounds, 982 F.2d 603 (1st Cir. 1992);
Third Circuit Task Force, Court Awarded Attorney Fees, 108 F.R.D.
237, 250 (1985). The common fund doctrine is implicated any time
one litigant's success releases well-defined benefits for a limited
and identifiable group of others. Its source is the broad power of
a court of equity. Alyeska Pipeline Serv. v. Wilderness Soc'y, 421
U.S. 240, 257 (1975).
We applied the restitutionary principle of the common
fund doctrine when we required an insurer to bear a proportionate
share of the attorney's fees for recovery of a workers'
compensation disbursement. Cooper v. Argonaut Ins. Cos., 556 P.2d
525, 527 (Alaska 1976). Furthermore, we recently stated that the
common fund doctrine applies in Alaska when we remanded a case with
the instruction that the superior court "could choose to apply the
common fund doctrine." In re Estate of Brandon, 902 P.2d 1299,
1319 n.23 (Alaska 1995). (EN5)
APC's principal argument against applying the common fund
doctrine in Alaska is that the doctrine conflicts with Rule 82.
Consideration of this contention requires a comparison of Rule 82
and alternative doctrines governing attorney's fees.
Under the "American rule,"each party pays its attorney's
fees, regardless of who prevails. See Alyeska Pipeline, 421 U.S.
at 247-60. Exceptions to the American rule include the award of
fees to public interest plaintiffs and to successful civil rights
litigants. See, e.g., Singh v. State Farm Mut. Auto. Ins. Co., 860
P.2d 1193, 1197 (Alaska 1993); Anchorage v. McCabe, 568 P.2d 986,
990 (Alaska 1977). Because the common fund doctrine allows court-
ordered payment of attorney's fees, it is often described as an
exception to the American rule. City of Klawock v. Gustafson, 585
F.2d 428, 431 (9th Cir. 1978) ("The common fund doctrine may be the
earliest exception to the 'American' rule that losers in litigation
are not liable for winners' attorney fees.").
The common fund doctrine differs from exceptions to the
American rule in that the doctrine is a mechanism for fee-
spreading, not fee-shifting; the common fund doctrine requires
reimbursement of fees "by the prevailing party, not the losing
party." Bowles, 847 P.2d at 449. Since each party still pays its
own attorney's fees, the common fund doctrine is entirely
consistent with the American rule. Boeing, 444 U.S. at 481.
Alaska is the only state that does not follow the
American rule. Alaska Judicial Council, Alaska's English Rule:
Attorney's Fee Shifting in Civil Cases 1 (1995). The purpose of
this state's fee-shifting provision, Civil Rule 82, is "to
partially compensate a prevailing party for the expenses incurred
in winning his case." Tobeluk v. Lind, 589 P.2d 873, 876 (Alaska
APC's claim that Rule 82 preempts the common fund
doctrine misunderstands the separate purposes served by the two
rules. While the common fund doctrine is a fee-spreading mechanism
which prevents unjust enrichment of those who derive benefit from
the efforts of others, Rule 82 is a fee-shifting tool which
provides partial reimbursement of a prevailing party's legal fees.
Rule 82 was not intended to cap recovery of attorney's
fees under other doctrines. Despite the existence of Rule 82,
Alaska has set attorney's fee awards under other exceptions to the
American rule. Singh, 860 P.2d at 1197 (applying 42 U.S.C. sec.
1988, and determining attorney's fees under its guidelines rather
than those of Rule 82); Hayer v. National Bank of Alaska, 663 P.2d
547, 549-50 (Alaska 1983) (applying Truth-in-Lending Act, and
determining attorney's fees under its guidelines). Thus, Rule 82
does not preempt the applicability of the common fund doctrine,
wholly or in part. (EN6)
B. The Common Fund Doctrine Applies in this Case.
The parties dispute whether the settlement reached for
the community in this case qualifies as a "common fund." We
conclude, as a matter of law, that the common fund doctrine is
applicable to the case at hand. (EN7)
The primary reasons for applying the common fund doctrine
to this case are to prevent unjust enrichment and provide
reasonable compensation to class counsel. In this case, the
plaintiffs' lawyers created a fund that would not otherwise exist.
The fund contains a specified amount, and it benefits a limited
community. (EN8) The benefit to the community is measurable when
expenditures from the Trust are made for community activities.
Thus the doctrine allows fees to be spread among those benefited by
the suit in proportion to the benefits they received. See John P.
Dawson, Lawyers and Involuntary Clients in Public Interest
Litigation, 88 Harv. L. Rev. 849, 916-22 (1975). Without
application of the doctrine in this case, the fund's beneficiaries
would receive a clear benefit from the efforts of the plaintiffs'
attorneys whose work created the fund, while those attorneys would
not be sufficiently compensated. We conclude that the facts in
this case give rise to the unjust enrichment or free rider concerns
that the common fund doctrine is intended to address, and that
application of the doctrine to this case is appropriate. (EN9)
C. Determination of a Reasonable Fee under the Common Fund
Although courts may differ and the federal circuits are
divided over how best to determine the amount of attorney's fees
under the common fund doctrine, all agree that a "reasonable"
attorney's fee is the proper standard.
Calculation of a reasonable fee under the common fund
doctrine is an issue of first impression in Alaska. While we have
considered various approaches to determining a proper fee award,
these have arisen in the context of statutory schemes such as 42
U.S.C. sec. 1988. (EN10)
Courts have adopted three distinct approaches to arriving
at the calculation of a reasonable fee. The first, adopted in
early Supreme Court common fund cases, is to award attorneys a
percentage of the fund. Pettus, 113 U.S. at 128. Because the
percentage approach sometimes resulted in huge fee awards and
apparent windfalls to attorneys who had little risk or work
involved, two alternatives gained popularity in the 1970s.
Under the "lodestar"approach, the court determines the
number of hours an attorney reasonably spent on the case and
multiplies that number by a reasonable hourly rate to determine an
initial attorney's fee figure, which can then be adjusted for
circumstances. Lindy Bros. Bldrs., Inc. v. American Radiator &
Standard Sanitary Corp., 487 F.2d 161, 166-68 (3d Cir. 1973), aff'd
in part and vacated in part, 540 F.2d 102, 112-18 (3d Cir. 1976).
Under a third approach, the Fifth Circuit identified
twelve factors for courts to consider and weigh. Johnson v. Ga.
Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir. 1974). The
Ninth Circuit subsequently adopted this method. Kerr v. Screen
Extras Guild, Inc., 526 F.2d 67, 69-70 (9th Cir. 1975), cert.
denied, 425 U.S. 951 (1976). The twelve factors, commonly known as
the Johnson-Kerr factors, are: (1) the time and labor required; (2)
the novelty and difficulty of the questions; (3) the skill
requisite to perform the legal services properly; (4) the
preclusion of other employment by the attorney due to acceptance of
the case; (5) the customary fee; (6) whether the fee is fixed or
contingent; (7) time limitations imposed by the client or the
circumstances; (8) the amount involved and the result obtained; (9)
the experience, reputation, and ability of the attorneys; (10) the
"undesirability"of the case; (11) the nature and length of the
professional relationship with the client; and (12) awards in
similar cases. Johnson, 488 F.2d at 717-19.
From these three alternative approaches federal courts
have developed a number of hybrid or "blended"approaches. The
prevalent blended approach is the modified lodestar or
lodestar/multiplier. In re Washington Pub. Power Supply Sys.
Litig., 19 F.3d 1291, 1294-95 & n.2 (9th Cir. 1994). Under this
approach, the trial court determines the lodestar amount based on
a reasonable hourly rate and the number of hours. The court then
has discretion to determine a multiplier which is applied to the
lodestar amount to establish the final attorney's fee figure.
Factors to be considered in determining whether to use a multiplier
include the Johnson-Kerr factors, the risk to counsel in taking the
case, achievement of extraordinary results, the quality of
representation, and substantial delay in payment. Id. at 1301-05.
The federal circuits differ over this issue. The First,
Sixth, Seventh and Ninth Circuits accept either the percentage or
modified lodestar approach and leave the choice to trial judges'
sound discretion. In re Thirteen Appeals Arising out of the San
Juan DuPont Plaza Hotel Fire Litig., 56 F.3d 295, 306-07 (1st Cir.
1995). The Third and Tenth Circuits also accept either method, but
express a preference for the percentage approach. In re General
Motors, 55 F.3d at 821; Gottlieb v. Barry, 43 F.3d 474, 483 (10th
Cir. 1994). (EN12) A majority of the circuits which have recently
addressed this issue have held that "the choice between lodestar or
percentage calculation depends on the circumstances,"Washington
Pub. Power, 19 F.3d at 1296 (quotations omitted), and that "the
approach of choice is to accord the district court discretion to
use whichever method . . . best fits the individual case." In re
Thirteen Appeals, 56 F.3d at 308.
In Washington Public Power, the Ninth Circuit upheld a
trial court's decision to award $32 million in attorney's fees
under a modified lodestar analysis to lawyers who recovered $687
million in settlements. 19 F.3d at 1294-95. The trial court chose
a lodestar approach, primarily because of "'the immense size of the
settlement fund,'"which "magnified beyond all reasonable limits
the margin of error inherent in a percentage fee award."
Washington Pub. Power, 19 F.3d at 1297 (quoting In re Wash. Pub.
Power Supply Sys. Sec. Litig., 779 F. Supp. 1063, 1085 (D. Ariz.
1990)). The Ninth Circuit held that the trial court acted within
[I]n common fund cases, no presumption in
favor of either the percentage or the lodestar
method encumbers the district court's
discretion to choose one or the other. As
always, when determining attorneys' fees, the
district court should be guided by the
fundamental principle that fee awards out of
common funds should be `reasonable under the
Id. at 1296 (quoting Florida v. Dunne, 915 F.2d 542, 545 (9th Cir.
1990)) (emphasis added in later opinion).
We agree with the logic that the Ninth Circuit followed
in Washington Public Power. Situations may exist where application
of the lodestar or the percentage method will render an unfair
result. For example, in a case in which an attorney recovers a
small fund, application of the lodestar might cause attorney's fees
to devour most or all of the fund, while in a case in which an
attorney quickly negotiates an enormous settlement, the percentage
method might cause an inordinate windfall. (EN13) Giving trial
courts the flexibility to decide between percentage and lodestar
allows the fairest determination of reasonable attorney's fees in
each situation. We therefore hold that a trial court applying the
common fund doctrine has the discretion to determine whether to
apply the percentage of the fund method or the modified lodestar
method in order to calculate attorney's fees.
Trial courts that choose to apply the percentage of the
fund method frequently adopt 25% as a baseline percentage and then
modify it according to circumstances. (EN14) We think this is a
sound approach for trial judges who choose to use the percentage
approach. One frequently-mentioned consideration is that the
percentage may decrease as the size of the fund increases. In
addition to the size of the fund, other considerations that may
affect the percentage include the Johnson-Kerr factors, the time
required to reach a settlement, whether class members have
substantial objections to the settlement terms or the fee request,
non-monetary benefits conferred by the settlement, the economies of
scale involved in a class action, and the structure of the
settlement. Camden I, 946 F.2d at 775; Mashburn, 684 F. Supp. at
Mindful that a trial court is acting as a court of equity
in common fund cases, in determining a reasonable fee the court
should exercise its discretion to avoid unjust enrichment of either
counsel or beneficiaries. As Justice Frankfurter wrote about
determining attorney's fees from a common fund, "[a]s in much else
that pertains to equitable jurisdiction, individualization in the
exercise of a discretionary power will alone retain equity as a
living system and save it from sterility." Sprague, 307 U.S. at
167. The trial court should explain the reasons behind its
decision. The advantages and disadvantages of each approach, as
noted here and in cases from other jurisdictions, should provide
sufficient guidance for the exercise of discretion.
On remand, the superior court could apply either a
lodestar analysis or a percentage of the fund analysis, whichever
it deems more appropriate.
The superior court found that Civil Rule 82 and not the
common fund doctrine governed attorney's fees in this case. We
hold that it erred. Therefore we REVERSE the judgment of the
superior court and REMAND for determination of attorney's fees
under the common fund doctrine.
1. The Rule 82(b)(1) schedule sets the amount of reimbursable
fees in this case at $84,500, based on the $3 million amount of the
settlement and the fact that the case was contested but not tried.
2. We review such legal questions de novo. Moore v. State Dep't
of Transp., 875 P.2d 765, 768 (Alaska 1994).
3. The doctrine is sometimes stated slightly more broadly to
include costs other than attorney's fees. See City and County of
San Francisco v. Sweet, 906 P.2d 1196, 1199 (Cal. 1995) (defining
the doctrine as "the equitable rule which permits surcharging a
common fund with the expenses of its protection or recovery,
including counsel fees"). Accord Swedish Hosp. Corp. v. Shalala,
1 F.3d 1261, 1265 (D.C. Cir. 1993).
4. The doctrine was further developed in Sprague v. Ticonic Nat'l
Bank, 307 U.S. 161 (1939). Some jurisdictions call the doctrine
the "equitable fund"doctrine, or the "fund-in-court"doctrine.
Fickinger v. C.I. Planning Corp., 646 F. Supp. 622, 632 (E.D. Pa.
5. Although the doctrine initially developed in federal courts,
nothing limits it to federal law. Most states apply the doctrine.
See, e.g., Sweet, 906 P.2d at 1199; Montalvo v. Chang, 641 P.2d
1321, 1327 (Haw. 1982); Oklahoma Tax Comm'n v. Ricks, 885 P.2d
1336, 1339 (Okla. 1994); Bowles v. Washington Dep't of Retirement
Sys., 847 P.2d 440, 449-50 (Wash. 1993).
6. Although this case involves a settlement, in a case resolved
by trial, a successful litigant could recover a fund from which
fees would be paid under the common fund doctrine and still apply
after trial for an attorney's fee award under Rule 82 from the non-
prevailing party. In such a case, Rule 82 would appropriately
allow partial reimbursement for charges against the fund.
7. Because this appeal involves an application for attorney's
fees from a fixed settlement fund, the parties may no longer be
adversaries with respect to the issues in this case. See In re
Continental Ill. Sec. Litig., 962 F.2d 566, 573 (7th Cir. 1992); In
re Activision Sec. Litig., 723 F. Supp. 1373, 1374 (N.D. Cal.
1989). Courts should therefore closely scrutinize applications for
attorney's fees from a fixed fund. In re Fine Paper Antitrust
Litig., 840 F.2d 188, 195-96 (3d Cir. 1988); Rothfarb v. Hambrecht,
649 F. Supp. 183, 237 (N.D. Cal. 1986).
8. The number of beneficiaries here is comparable to or smaller
than that of beneficiaries in other common fund cases, such as
derivative securities or toxic tort litigation. See, e.g., In re
"Agent Orange"Prod. Liab. Litig., 818 F.2d 226 (2d Cir. 1987).
9. Not every case in which a party or a party's counsel produces
a benefit for others implicates the common fund doctrine. To
determine whether the doctrine is applicable to a fact pattern, the
Ninth Circuit employs a set of criteria that the U.S. Supreme Court
applied in Boeing and Alyeska Pipeline. According to these
criteria, "[t]he common fund doctrine is properly applied . . . if
'(1) the class of beneficiaries is sufficiently identifiable, (2)
the benefits can be accurately traced, and (3) the fee can be
shifted with some exactitude to those benefitting.'" Paul,
Johnson, Alston & Hunt v. Graulty, 886 F.2d 268, 271 (9th Cir.
1989) (quoting In re Hill, 775 F.2d 1037, 1041 (9th Cir. 1985)).
See also Boeing, 444 U.S. at 478-79; Alyeska Pipeline, 421 U.S. at
265 n.39; Southeast Legal Defense Group v. Adams, 657 F.2d 1118,
1123 (9th Cir. 1981); Stevens v. Municipal Court, 603 F.2d 111, 112
(9th Cir. 1979). The doctrine is inapplicable where the benefit
gained by each beneficiary may not easily be ascertained, as where
"sophisticated economic analysis would be required"to determine
exactly how much each beneficiary gained from the litigation.
Alyeska Pipeline, 421 U.S. at 264 n.39. We find that this case
meets the Alyeska Pipeline criteria.
10. See, e.g., Singh, 860 P.2d at 1199; Hayer, 663 P.2d at
11. The court in Washington Public Power declined to extend to
common fund cases the rationale of City of Burlington v. Dague, 505
U.S. 557 (1992), which prohibited the use of risk multipliers in
statutory fee cases. Id. at 1299. But see In re General Motors
Corp. Pick-Up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d 768, 822
(3d Cir. 1995), cert. denied, 116 S. Ct. 88 (1995).
12. The Fifth Circuit requires the lodestar method, while the D.C.
and Eleventh Circuits require the percentage method. In re
Thirteen Appeals, 56 F.3d at 306. Law in the Second Circuit is
ambiguous. In 1987 the Second Circuit chose the lodestar method.
"Agent Orange", 818 F.2d at 232. More recently, however, the
Southern District of New York has allowed both, see, e.g., Dubin v.
E.F. Hutton Group, Inc., 878 F. Supp. 616, 621 & n.5 (S.D.N.Y.
1995), and found the percentage method to be "preferable." Bragger
v. Trinity Capital Enter. Corp., No. 92 Civ. 2124, 1993 WL 287626
at *4 (S.D.N.Y. July 23, 1993), appeal dismissed, 30 F.3d 14 (2d
13. See Rawlings v. Prudential-Bache Properties, Inc., 9 F.3d 513,
516 (6th Cir. 1993) ("The lodestar method better accounts for the
amount of work done, while the percentage of the fund method more
accurately reflects the results achieved.").
14. While acceptable percentage awards have ranged from under 10%
to 50%, the consensus seems to be that 20% to 30% (or 19% to 33%)
is normally reasonable. See Monique Lapointe, Attorney's Fees in
Common Fund Actions, 59 Fordham L. Rev. 843, 867-68 & n.169 (1991);
Christopher P. Lu, Procedural Solutions to the Attorney's Fee
Problem in Complex Litigation, 26 U. Rich. L. Rev. 41, 47-48 & n.37
(1991). The median and the most common figure seems to be 25% of
the fund. In re Pacific Enters. Sec. Litig., 47 F.3d 373, 379 (9th
Cir. 1995); Camden I Condominium Ass'n v. Dunkle, 946 F.2d 768, 775
(11th Cir. 1991); Mashburn v. National Healthcare, Inc., 684 F.
Supp. 679, 692 (M.D. Ala. 1988); but see Activision, 723 F. Supp.
at 1375 ("almost always hovers around 30%").
15. Trial courts which elect to follow a percentage approach must
exercise their independent discretion in arriving at a fair and
reasonable fee award under the common fund doctrine. The
percentage figures in lawyers' contingent fee agreements with the
class representatives "are not controlling on the court's
determination of fees for the class recovery." Alba Conte,
Attorney Fee Awards 61 (2d ed. 1993). However, at least one
appellate court thought the contingency fee level worth
consideration. Continental Illinois, 962 F.2d at 572-73 ("[I]t
might be quicker and easier to generate [evidence about fee
arrangements in comparable litigation] than it would be to hassle
over every item or category of hours and expense. . . ."). We
believe that in determining what percentage to apply, trial courts
may consider, but should not be bound by, the percentage in a
contingency fee arrangement.