Recently in class actions Category

February 8, 2008

Is it anything like cow-tipping?

cow.jpgHow much did an attorney earn in his class action suit alleging that Sears' stoves had a tendency to tip over? $17 million. How many stoves actually tipped over? None. The attorney only alleged that if you put too much weight on a stove, it could tip over. What did Sears stove owners get from the lawsuit? If they signed on for the settlement, a stove owner could get a $100 coupon towards installation of an anti-tip bracket. How much did Sears pay to attorneys who brought a lawsuit over wheel-alignment pricing? $950,000. How much did the company pay to customers over the lawsuit? $2,402. Or as the judge in the case put it, "Doing the math in this case is easy. For each class member who received a $10 check or $4 coupon, plaintiffs' counsel received just shy of $3,000." Bonus Question: Is cow-tipping possible?

December 18, 2007

Killing Me (Micro)Softly

bill-gates.jpgHow much was a Minneapolis law firm awarded in legal fees for suing Microsoft? $65 million. That's how much judges awarded the Zelle Hoffman law firm in three antitrust cases against the software giant.

How much do Zelle Hoffman's top attorneys charge per hour? $750. How much does Microsoft's top attorney charge per hour? $1000.

How much was the Townsend and Townsend law firm awarded in legal fees for winning a lawsuit against Microsoft? Approximately $30 million. How much did the law firm request? $92.5 million.

Why are these fee awards so astronomical?
(a) The judges who make these awards use Macs and hate PCs
(b) The judges can't figure out how to use Excel spreadsheets
(c) The judges are basing the awards on Bill Gates hourly rate, or
(d) The judges are making the awards in Bill Gates dollars.
Actually, it's none of the above. Judges use what's called a 'lodestar' calculation. The attorney hours are multiplied by the attorney's hourly rate and that number is multiplied by the lodestar (which is supposed to represent the "risk" of suing Microsoft and losing).

What was the lodestar sought by the Townsend law firm? 5.5. In other words, a Townsend lawyer who charges $500 an hour would have earned $2,500 an hour. What lodestar did the judge award? 2.0, so that same Townsend attorney would only earn $1,000 an hour. "Obviously, we're disappointed," said Townsend's lead attorney. Yeah, obviously.

What did consumers get as a result of the Microsoft lawsuit? Vouchers for Microsoft products worth $5 for each copy of Microsoft Word they purchased, $16 for each copy of Microsoft Windows and $29 for each copy of Microsoft Office. Hmm. Maybe that explains why Bill earned $291,549,774.24 today.