The class counsel representing the plaintiffs in the House v. NCAA lawsuit filed a motion with the court Tuesday night seeking legal fees and reimbursements of around $484 million.
That tally, the motion states, represents 20% of the NIL settlement fund, 10% of the additional compensation fund, an injunction relief award of $20 million paid by the defendants, and a little over $9 million for “out-of-pocket litigation expenses.”
The motion cites the percentage-of-the-fund analysis and recent precedent of other class action lawsuits in the U.S. Court of Appeals for the Ninth Circuit, which governs the California federal district court overseeing the House and related cases (Carter v. NCAA and Hubbard v. NCAA), to have awarded class counsel above 25%. The plaintiffs’ attorneys also request they be awarded reimbursement of their litigation costs and expenses totaling approximately $9.1 million.
Meanwhile, the lawyers are asking that the class representatives in the case—Grant House, Tymir Oliver, Sedona Prince—receive $125,000 apiece. As to class representatives DeWayne Carter and Nya Harrison, each would receive a service award of $10,000 while class representative Nicholas Solomon would net a service award of $5,000.
“I understood from the outset that participating in this lawsuit as a class representative would not necessarily provide a significant financial benefit to me,” House said in a declaration filed in conjunction with the motion. He noted that he incurred “substantial risks” to his collegiate and Olympic future by lending his name to litigation that directly challenged the NCAA while a swimmer at Arizona State.
The class counsel was made up of two plaintiffs law firms, Hagens Berman–which filed the initial House v. NCAA complaint in June 2020–and Winston & Strawn, which joined the consolidated litigation in July 2021.
When all was said and done, the firms say they reviewed more than 1.6 million pages of documents produced by the defendants, while serving subpoenas on nearly 200 third parties that led to another 80,000 pages of discovery.
Moreover, the counsel argued that it “expended significant resources” to protect their clients’ interests outside of court, which included holding numerous meetings with Washington lawmakers to fend off a concurrent, $10 million lobbying campaign by the NCAA to obtain an antitrust exemption from Congress.
In September, the class and defendants submitted a settlement agreement to the court that provided for a $1.98 billion NIL settlement fund, an additional $600 million compensation fund for claims brought in the Carter case, and injunctive relief that will permit schools, going forward, to share a certain amount of its annual revenue with athletes.
The settlement also entitles the class counsel to earn an annual percentage share of that athlete revenue over the next decade, with a starting share of 0.75% in the first year, scaling up to 1.5% in the 10th. That means the plaintiffs lawyers could earn tens of millions of dollars in addition to the $484 million they are currently seeking.
U.S. District Judge Claudia Wilken will review the proposal and consider potential objections. Her analysis will focus on applying Rule 23 of the Federal Rules of Civil Procedure, which allows her to award the attorneys “reasonable fees and nontaxable costs.”
The Ninth Circuit permits two ways for determining attorneys’ fees in class actions. The first is the “lodestar” method, which multiplies the hours the court deems were reasonably spent by attorneys on the case by a reasonable hourly rate.
According to declarations submitted by the class counsel, Winston & Strawn calculated its total hourly billings for House at $36 million–of which $3.2 million was attributed to its co-executive chairman Jeffrey Kessler, who billed at a rate of $1,980/hour–while Hagens Berman pegged its total lodestar at $18.2 million. Named partner Steve Berman, the lead counsel in the case, reported billing $1.5 million, while his colleague, Ben Siegel, generated $4.6 million over 5,415 hours.
The second method, picked by the class counsel, is the percentage-of-recovery approach which centers on the attorneys receiving a percentage, with the Ninth Circuit using 25% as a benchmark of the total settlement fund or the amount claimed by the class. Last year the Ninth Circuit reversed attorneys’ fees in the Lowery v. Rhapsody class action on account that the fees were excessive and not reflective of a share of the actual monetary benefit to class members.
A common risk for attorneys in class actions is that clients are typically not expected to pay for legal services and class actions can prove enormously time consuming over a period of years. Attorneys, in other words, might perform numerous billable hours and not be paid, while forgoing work on potential billable matters. Class actions, however, can prove lucrative for attorneys when the case is certified as a class action and the parties reach a settlement or the plaintiffs win in court and the verdict is upheld on appeal.
A hearing for the attorneys’ fees motion is set for April 7.
