Legal Fee Tracker: JetBlue, Spirit say lawyers don't deserve credit for scrapped merger
By David Thomas
Aug 8 (Reuters) -JetBlue Airways JBLU.O and Spirit Airlines SAVE.N are pressing a judge not to reward a group of law firms that sued to block the airlines' proposed $3.8 billion merger, arguing that the lawyers "piggy-backed" on the U.S. Justice Department's separate lawsuit challenging the deal.
The airlines abandoned their merger in March, after a judge sided with the Justice Department in a January ruling that said the combination would harm consumers.
But that doesn't mean private antitrust plaintiffs shouldn't get credit, according to the law firms' bid for fees, especially since they sued before the government brought its case.
Joseph Alioto of the Alioto Law Firm in San Francisco, who has also filed lawsuits opposing other airline mergers, asked U.S. District Judge William Young in Boston last month to award up to $34.1 million to the plaintiffs' team, which includes lawyers from eight other law firms.
The request works out to between $3,000and $5,000an hour for the lawyers' work on the case, which the judge dismissed in June.
"Plaintiffs' case was dismissed as moot," the airlines said in a Friday filing in Boston federal court. "They did not try this case. They did not win at summary judgment."
The airlines, represented by attorneys from Cooley and Paul, Weiss, Rifkind, Wharton & Garrison, argued that Alioto's case was failing even before it was put on hold last year amid the government's challenge. Of the 25 original plaintiffs, 22 were dismissed for lack of standing and another died, they said.
Even if the plaintiffs could claim any credit for the government's success, the award they are seeking for 6,776 hours of legal work on the case is unreasonable, the airlines said.
"That is an excessive number of hours for a case that never went to trial and in which Plaintiffs largely piggy-backed off the DOJ matter," the airlines argued.
Alioto's view is unsurprisingly different. The airlines initially appealed the Justice Department's court victory, he said in an interview, and the threat of his case waiting in the wings is what persuaded Spirit and JetBlue to walk away.
"If we didn’t exist, they would have continued the appeal," Alioto said.
Spokespersons for the airlines did not immediately respond to a request for comment. The Justice Department has not weighed in on the plaintiffs' fee request, and a DOJ spokesperson declined to comment.
The private plaintiffs first sued in November 2022, four months before the Justice Department. The government had either not sued or been unsuccessful in past airline merger cases, the plaintiffs said in their fee request, so there was no indication that antitrust enforcers would target the JetBlue-Spirit deal.
Alioto said Congress included a fee award provision in the Clayton Act to encourage antitrust litigation from private plaintiffs. He accused the airlines of trying to eliminate private enforcement of the antitrust statute by opposing their fee request.
"They're trying to destroy the purpose of the statute and efficacy of the statute," Alioto said.
- In other legal fee news, three U.S. firms — Boies Schiller, Morgan & Morgan and Susman Godfrey — on Wednesday defended their bid for $217 million in fees for a settlement they inked with Google resolving claims that the tech giant deceptively collected data from users despite their use of private-browsing in Chrome's "Incognito" mode.
Google, which has denied wrongdoing, is fighting the amount, which it called excessive. The case settled without a common fund for consumers, and a Quinn Emanuel Urquhart & Sullivan lawyer for Google said the resolution was far from historic.
David Boies argued at Wednesday's hearing that the plaintiffs "really had to fight it out." U.S. District Judge Yvonne Gonzalez Rogers seemed inclined to reduce the requested amount, but she did not say by how much.
- Top partners at Davis, Polk & Wardwell are charging $2,375 an hour as they advise Purdue Pharma in its bankruptcy proceedings, the U.S. law firm said in court papers filed Tuesday.
Marshall Huebner, who co-leads the firm's restructuring practice, billed the most hours out of the seven partners who worked on the bankruptcy case in June, according to the filing.
The company's bankruptcy plan was upended in June by the U.S. Supreme Court, which ruled that the company's bankruptcy settlement cannot shield its owners, members of the wealthy Sackler family, over their alleged role in spurring an opioid addiction crisis in the United States.
(Legal Fee Tracker is a weekly feature exploring attorney compensation awards and disputes in class actions, bankruptcies and other matters. Please send tips or suggestions to D.Thomas@thomsonreuters.com.)
Additional reporting by Mike Scarcella
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Reporting by David Thomas
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