Lawyers Seek $122.5 Million Payout in Major Apple Securities Case Settlement

Attorneys who reached a $490 million securities class action settlement with Apple earlier this year are hoping to walk away with a quarter of that amount in legal fees, arguing that the risks they took warrant a hefty reward.

Lawyers at Robbins Geller Rudman & Dowd and Labaton Keller Sucharow this week asked a federal judge, opens new tab in Oakland, California to award them $122.5 million, or about $3,100 an hour for the 65 lawyers and staffers who together devoted 39,500 hours to the case, according to the firms' filings.

Multiplying those hours by the professionals' hourly rates would yield an award of about $27.8 million, they said, arguing that their much larger request is appropriate given their adversary was "the largest – and arguably one of the most powerful – companies on the planet."

The settlement resolves allegations that Apple CEO Tim Cook defrauded shareholders by concealing falling demand for iPhones in China.

When Apple reduced its quarterly revenue forecast by as much as $9 billion in 2019, it was the first time since the iPhone's launch that Apple had cut its revenue forecast. Apple denied the claims.

The firms' $122.5 million request matches the benchmark of 25% of a class action settlement fund for attorney fee awards adopted by federal courts in California and elsewhere in the 9th Circuit.

But courts there have sometimes pushed back at the 25% standard in so-called megafund cases where settlements exceed $100 million.

In 2015, for instance, a San Jose federal judge slashed an attorney fee request of 19.54% to around 10% in a $415 million settlement that ended a high-profile lawsuit accusing Apple, Google and two other Silicon Valley companies of conspiring to hold down salaries.

"This 25% benchmark is clearly too high in some cases," said University of Michigan law professor Adam Pritchard, who studies securities class actions. Pritchard co-authored a 2023 study that estimated that Robbins Geller earned more than $1 billion in fees from securities class actions from 2005 to 2018.

Robbins Geller and Labaton said Apple's all-cash $490 million settlement is the third-largest deal of its kind in the Northern District of California, and one of the 40 largest settlements ever in a securities class action.

US District Judge Yvonne Gonzalez Rogers is weighing the fee bid as she decides whether to grant final approval to the settlement. She is no stranger to major litigation against Apple, and in 2022 she approved a $26 million fee award in an antitrust class action related to the company's App Store that settled for $100 million.

Rogers is also currently weighing a $217 million fee request from Boies Schiller Flexner, Morgan & Morgan and Susman Godfrey after the firms reached a non-monetary settlement with Google in a consumer privacy case. Google has opposed the fee award.

Responses to the fee request in the Apple securities case are due July 29, and a hearing is scheduled for September 17.

Auction Averted

On the other side of the country, a dispute over a much smaller legal fee briefly caught the attention of South Florida's art scene when it threatened to put a prominent dealer's collection of Latin American and other artwork on the auction block.

A Miami judge cancelled the July 22 auction after the dealer, Gary Nader, put up a half-million-dollar bond to cover legal fees he was ordered to pay his ex-lawyers at Fort Lauderdale firm Stok Kon + Braverman.

Stok Kon's Robert Stok told Reuters he believed the auction could have forced Nader to sell a "large inventory of artwork" worth as much as $100 million.

A lawyer for Nader said his client owed Stok Kon nothing and accused the firm of "extremely aggressive collection tactics."

Stok Kon sued Nader in 2022, alleging he owed more than $216,000 in unpaid fees stemming from the firm's legal work on a failed museum development project.

A judge ruled in April that Nader must pay Stok Kon its fees plus interest, and last month ordered that Nader's sole membership interest in his company, Gary Nader & Company LLC, be auctioned off to satisfy the judgment.

The company's holdings include a building in Miami’s Wynwood Art District that houses Nader's gallery and museum.

The museum on its website said it has 30,000 square feet of exhibition space showcasing art from Latin America and the Caribbean, including a collection of work from Columbian artist Fernando Botero. Nader has appealed the court's judgment.

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