# Lawyers get $19 million, clients get rolled! **URL:** \ **Category:** Great Debates\ **Created:** [May 24, 2003, 6:29am UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194 "2003-05-24T06:29:48Z")\ **Posts on this page:** 11\ **Page:** 5
**Author:** ![lucwarm](https://avatars.discourse-cdn.com/v4/letter/l/e19adc/32.png) [@lucwarm](https://boards.straightdope.com/u/lucwarm)\ **Post date:** [May 29, 2003, 4:18am UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/81 "2003-05-29T04:18:22Z")
> [@](#): > > \*Originally posted by Bricker \* > \*\* What did you do? Nada. Zip. \*\* Totally disagree. The class member bought the actual product that wasn’t made properly. Or paid the late fee that he shouldn’t have paid. etc. etc. \*\* > [@](#): > > Listen, you know the story about the plumber who’s called to fix a difficult problem? He quotes the homeowner a price of $500, to which the homeowner agrees. \*\* In a class action, the class member does not have a meaningful opportunity to bargain with his or her attorney. \*\* > [@](#): > > that they should voluntarily reduce their fees in favor of the class. \*\* Personally, I feel that courts and legislatures should scrutinize class-action settlements more carefully. \*\* > [@](#): > > The point I’m making is that the MARKET determines what the price is. \*\* Attorneys are fiduciaries and officers of the court. The morals of the marketplace do not apply. This is particularly true when the client does not have any meaningful ability to negotiate with his or her attorney. Just MHO. By the way, I’m an attorney who does a lot of contingency fee work. I do it to make money and hope to make a lot of money. But ultimately, my job is to serve my clients’ interests. Sorry if this sounds self-aggrandizing or preachy. ---
**Author:** ![ralph124c](https://avatars.discourse-cdn.com/v4/letter/r/8797f3/32.png) [@ralph124c](https://boards.straightdope.com/u/ralph124c)\ **Post date:** [May 29, 2003, 12:33pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/82 "2003-05-29T12:33:04Z")
I think this thread illustrates that there should be a futures market in lawsuits: that is, you can buy into a lawsuit by purchasing shares! This would allow those of us who arent interested in penny-ante coupons to invest in bigger things. Think about it-the class counsel lawyers have already committed the crime of champerty-they have no direct interest in the case-cept the money theu will get. So, let’s have a markey where future awards can be bought and sold. In this way, an intelligent investor can decide the merits of a given class-action lawsuit, and chose to invest or not. Also, the lawyesr should be required to purchase the futres as well-so they can share in the cheesey payouts that most of these things merit! Well, I’m off to check my winnings in the ASBESTOS INSULATION CAL, and the Compact Disc OVercharge CAL, and the ,etc.,etc… ---
**Author:** ![Bricker](https://avatars.discourse-cdn.com/v4/letter/b/977dab/32.png) [@Bricker](https://boards.straightdope.com/u/Bricker)\ **Post date:** [May 29, 2003, 12:41pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/83 "2003-05-29T12:41:41Z")
> [@](#): > > \*Originally posted by RTFirefly \* > The problem is the divergence of plaintiffs’ and attorneys’ interests. Feel free to address it at any old time. Fair enough. And you know what? It _is_ an issue. I have never done a piece of contingency work in my life. But I can tell you that if I were to enter into such an endeavor, the contingency agreement with my client would spell out when I could settle the case – that is, if the defendant offered X, I’d be permitted to accept that. And if the client and I couldn’t agree on that, then I wouldn’t do the work. This might not prevent my interest in getting paid becoming at least a little adverse as to my client’s interest in being made whole, but at least it would represent an agreement he made ahead of time with, presumably, eyes open. I expect a similar agreement is made between the would-be class counsel and the named plaintiff, who is typically treated much better than “all others similarly situated.” The problem you’re talking about comes along because, as **lucwarm** correctly points out, there is little chance for each class member other than the named plaintiff(s) to negotiate meaningfully with class counsel. Therefore, they are in a position of taking whatever settlement is thurst at them (and approved by the court, I might add) or opting out of the class. But that last sentence is the one area in which they can make a meanignful statement. If the settlement is so onerous as the constitute absolutely no benefit, or a worse benefit than they might receive elsewhere, why in heaven’s name would they refuse to opt out? Why wouldn’t some other, less greedy lawyer come along and negotiate a better deal? In other words, why do you assume the results of the marketplace are flawed? Yes, I agree - in a class action, the interests of the lawyer and the class-member client are potentially divergent, if not outright adverse. But this is the nature of the class action. The attorney was motivated primarily by the chance of getting paid. There is an independent judicial review of the settlement, and that judge has every right to refuse a settlement on the grounds of excessive fees to counsel. The class memebrs have every right to opt out. It’s hard to picture this as inherently coercive. > [@](#): > > I accept your gracious concession on the field of logic, since you’re choosing to avail yourself of the taunts of the elementary-school schoolyard instead. Yeah, I’ve been in a pissy mood lately. I apologize for all the juvenile garbage. ---
**Author:** ![Evil\_Captor](https://avatars.discourse-cdn.com/v4/letter/e/f17d59/32.png) [@Evil\_Captor](https://boards.straightdope.com/u/Evil_Captor)\ **Post date:** [May 29, 2003, 12:58pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/84 "2003-05-29T12:58:58Z")
> [@](#): > > \*Originally posted by lucwarm \* > \*\*Interesting, I’ll give it some thought. > > Anyway, I think it would help the discussion if you would break down your points, one by one. (I gather you’re giving up on the argument that the ABA promotes anticompetive behaviour?) \*\* Actually, that’s not how the game is played. Milum was challegned to give a cite to back up his assertions, he did so. It is now beholden on all who doubted his word to either 1. apologize and admit he was right and they were wrong 2. discover a logical or factual error in the cite that invalidates it 3. come up with an equally convincing counter-cite of their own Anything else is being less than fair. ---
**Author:** ![Bricker](https://avatars.discourse-cdn.com/v4/letter/b/977dab/32.png) [@Bricker](https://boards.straightdope.com/u/Bricker)\ **Post date:** [May 29, 2003, 1:04pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/85 "2003-05-29T13:04:37Z")
Did I miss something, **Evil Captor**? I see a citattion that addresses attorney donation of money to politicians of both political parties. I don’t see any cite that purports to prove attorney colusion in price-fixing. There is no “logical or factual error” in his cite, so far as I’m aware. It just fails to address the point. ---
**Author:** ![Evil\_Captor](https://avatars.discourse-cdn.com/v4/letter/e/f17d59/32.png) [@Evil\_Captor](https://boards.straightdope.com/u/Evil_Captor)\ **Post date:** [May 29, 2003, 1:21pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/86 "2003-05-29T13:21:51Z")
> [@](#): > > \*Originally posted by Robb \* > \*\*Firestone lost money in 2001. They made a profit last year. [See](http://www.bridgestone-firestone.com/news/media_center_fr.html) > Bridgestone Corporation Announces 2002 Consolidated Financial Results > Losing money hasn’t stopped Ford from creating the Pinto, the Bronco II, or the Explorer. But, I certainly hope it taught Firestone a lesson. > Remember, you think that this class action is a sign of a litigious society. What is Ford’s and Firestone’s conduct a sign of? \*\* Your entire post is made moot’s by Cheesesteak’s assertion that Firestone lost $1.6 billion on their tire fiasco prior to the class action lawsuit, which let’s face it, is small change in relation to $1.6 billion. If the natural consequences of their actions so greatly outweighs the losses incurred by a class action suit, then the suit is pointless and serves only one purpose – enriching the lawyers. ---
**Author:** ![Evil\_Captor](https://avatars.discourse-cdn.com/v4/letter/e/f17d59/32.png) [@Evil\_Captor](https://boards.straightdope.com/u/Evil_Captor)\ **Post date:** [May 29, 2003, 1:32pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/87 "2003-05-29T13:32:20Z")
> [@](#): > > \*Originally posted by Bricker \* > \*\*Did I miss something, **Evil Captor**? I see a citattion that addresses attorney donation of money to politicians of both political parties. I don’t see any cite that purports to prove attorney colusion in price-fixing. > > There is no “logical or factual error” in his cite, so far as I’m aware. It just fails to address the point. \*\* I was under your impression that you were also asking for more logic from milum wrt the issue of attorney donations, since that was the cite you quoted in your post. ---
**Author:** ![lucwarm](https://avatars.discourse-cdn.com/v4/letter/l/e19adc/32.png) [@lucwarm](https://boards.straightdope.com/u/lucwarm)\ **Post date:** [May 29, 2003, 3:11pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/88 "2003-05-29T15:11:09Z")
> [@](#): > > \*Originally posted by Evil Captor \* > \*\*Actually, that’s not how the game is played. Milum was challegned to give a cite to back up his assertions, he did so. It is now beholden on all who doubted his word to either > > 1. apologize and admit he was right and they were wrong > 2. discover a logical or factual error in the cite that invalidates it > 3. come up with an equally convincing counter-cite of their own > > Anything else is being less than fair. \*\* Here’s the thing: I checked out that site and got confused. Why are lawyers and lobbyists grouped together? Are they including donations made on behalf of clients? I did a couple google searches and couldn’t find anything else. Based upon the site, I’m willing to concede the possibility that lawyers and law firms donate more money to politicians than other industries. But I don’t have the energy or inclination to take the discussion any further. So go ahead and claim victory (at least on that point). ---
**Author:** ![Bricker](https://avatars.discourse-cdn.com/v4/letter/b/977dab/32.png) [@Bricker](https://boards.straightdope.com/u/Bricker)\ **Post date:** [May 29, 2003, 3:30pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/89 "2003-05-29T15:30:29Z")
No - in fact, he acknowledges in his later post that he was “still researching” the issue of collusion and price-fixing. I’m still waiting. ---
**Author:** ![RTFirefly](https://avatars.discourse-cdn.com/v4/letter/r/c77e96/32.png) [@RTFirefly](https://boards.straightdope.com/u/RTFirefly)\ **Post date:** [May 29, 2003, 8:36pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/90 "2003-05-29T20:36:31Z")
> [@](#): > > \*Originally posted by Bricker \* > Fair enough. And you know what? It _is_ an issue. Thanks for acknowledging this. > [@](#): > > The problem you’re talking about comes along because, as **lucwarm** correctly points out, there is little chance for each class member other than the named plaintiff(s) to negotiate meaningfully with class counsel. Therefore, they are in a position of taking whatever settlement is thurst at them (and approved by the court, I might add) or opting out of the class. > > But that last sentence is the one area in which they can make a meanignful statement. If the settlement is so onerous as the constitute absolutely no benefit, or a worse benefit than they might receive elsewhere, why in heaven’s name would they refuse to opt out? Why wouldn’t some other, less greedy lawyer come along and negotiate a better deal? In other words, why do you assume the results of the marketplace are flawed? For all the reasons you’ve stated at length: > [@](#): > > what’s to stop another lawyer from offering to represent the class at that cheaper price? Of course, that second lawyer can’t just waltz in – he would have had to spend the upfront capital to develop the case too. > > The point I’m making is that the MARKET determines what the price is. There are only X number of law firms that have the capital and expertise to prepare a class action and be a credible enough threat to force a settlement. By your description, it would appear to be a rare case where there’s room for a second lawyer to form a second class and have a chance at recouping his investment of time and money. Now I’ve been in a few of these classes, so let me just go over the ground from the ant’s-eye view. The first I ever found out that I was in such a class was when I received the notice of the proposed settlement. I had a fairly limited time to choose whether to stay in or opt out. I had no way of communicating with other class members to find out whether others were interested in opting out, or whether I was the only one who both disliked the settlement and actually gave a flip one way or the other. And without being able to organize and communicate with fellow members of my class, what’s the chance that opting out would do anybody any good? Approximately zip. The _realistic_ choices are: stay in the class and receive a share of the pseudo-settlement, or opt out and not even get that. > [@](#): > > Yes, I agree - in a class action, the interests of the lawyer and the class-member client are potentially divergent, if not outright adverse. But this is the nature of the class action. The attorney was motivated primarily by the chance of getting paid. I don’t see why this has to be ‘the nature of the class action’, or why the attorney’s desire for lucre should be the source of any divergence of interest here. The _percentage_ of the take received by the lawyer isn’t my issue; even if he gets 99% and the class divides a measly 1%, _if their payoffs are equivalent in kind, then their interests will be in tandem._ If the attorney does better for the class, he’ll do better for himself, and vice versa. To use your bus analogy, I’m not trying to drive from the back of the bus, but I’d like to know that the driver and I are going _in the same direction_, even if he gets from Chicago to New York, and we passengers only make it as far as Gary, Indiana. (We’ve got a relativistic bus here. I can deal with that if you can. :)) The problem with these coupon settlements is that while both driver and passengers want to go east, the driver can send the passengers south while only the driver goes east. > [@](#): > > There is an independent judicial review of the settlement, and that judge has every right to refuse a settlement on the grounds of excessive fees to counsel. Let’s think this part through. You can either look at coupons as: (a) being worth their face value, in which case the fees aren’t excessive; (b) having some cash value, which will later be determined by the free market, but which is unknowable until the market is as glutted as it’s going to get with the coupons - in which case there’s no way to say whether the fees are excessive until long after the settlement’s approved; or © one can regard cash and coupons as being different entities, like real and imaginary numbers, in which case the attorneys’ fees aren’t excessive in relation to the settlement for the plaintiff class, so much as meaningless in relation to it. Is $19M for the attorneys more or less than $40_i_M for the plaintiffs? No; they’re not comparable. (a) is obviously wrong; if we go by (b), the evidence to contest the appropriateness of the settlement doesn’t arrive until after the settlement is final; and © is just plain no help at all. > [@](#): > > The class memebrs have every right to opt out. It’s hard to picture this as inherently coercive. Coercion isn’t the problem. Lawyers gaming the system, putting it to unintended and unreasonable uses, is the problem. > [@](#): > > Yeah, I’ve been in a pissy mood lately. I apologize for all the juvenile garbage. Happens to all of us. No prob. ---
**Author:** ![Robb](https://avatars.discourse-cdn.com/v4/letter/r/a183cd/32.png) [@Robb](https://boards.straightdope.com/u/Robb)\ **Post date:** [May 29, 2003, 10:40pm UTC](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194/91 "2003-05-29T22:40:47Z")
Here is a [memorandum](http://www.fenphen.verilaw.com/pto/memo2859.pdf) (.pdf file) from Judge Bartle of the Eastern District of Pennsylvania. It concerns an interim award of attorney fees in the fen-phen class action. It awards more than $153 million to a number of firms, yet that will not be the final amount. It covers how the amounts were calculated and deals with objections to it. [Previous page](https://boards.straightdope.com/t/lawyers-get-19-million-clients-get-rolled/177194.md?page=4)