In Re:MEMORANDUM in Support of MOTION for Attorney Fees , Reimbursement of Expenses and Service Award 423C.D. Cal.December 30, 2010 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ROBBINS GELLER RUDMAN & DOWD LLP JOHN J. STOIA, JR. (141757) jstoia@rgrdlaw.com THEODORE J. PINTAR (131372) tedp@rgrdlaw.com RACHEL L. JENSEN (211456) rjensen@rgrdlaw.com PHONG L. TRAN (204961) ptran@rgrdlaw.com STEVEN M. JODLOWSKI (239074) sjodlowski@rgrdlaw.com 655 West Broadway, Suite 1900 San Diego, CA 92101 Telephone: 619/231-1058 619/231-7423 (fax) BONNETT, FAIRBOURN, FRIEDMAN & BALINT, P.C. ANDREW S. FRIEDMAN (Pro Hac Vice) afriedman@bffb.com KIMBERLY C. PAGE kpage@bffb.com 2901 N. Central Avenue, Suite 1000 Phoenix, AZ 85012 Telephone: 602/274-1100 602/274-1199 (fax) HAGENS BERMAN SOBOL SHAPIRO LLP STEVE W. BERMAN (Pro Hac Vice) steve@hbsslaw.com 1918 8th Avenue, Suite 3300 Seattle, WA 98101 Telephone: 206/623-7292 206/623-0594 (fax) Interim Co-Lead Class Counsel [Additional counsel appear on signature page.] UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION In re MIDLAND NATIONAL LIFE INSURANCE CO. ANNUITY SALES PRACTICES LITIGATION This Document Relates To: ALL ACTIONS. ) ) ) ) ) ) ) ) ) MDL No. CV-07-1825-CAS(MANx) PLAINTIFFS’ MEMORANDUM IN SUPPORT OF MOTION FOR AN AWARD OF ATTORNEYS’ FEES, REIMBURSEMENT OF EXPENSES, AND SERVICE AWARD JUDGE: Hon. Christina A. Snyder DATE: February 28, 2011 TIME: 11:00 a.m. CTRM: 5 – Second Floor Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 1 of 39 Page ID #:4205 TABLE OF CONTENTS Page - i - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. INTRODUCTION........................................................................................... 1 II. HISTORY OF THE LITIGATION AND SETTLEMENT ............................ 3 III. THE SETTLEMENT CONFERS SUBSTANTIAL ECONOMIC BENEFITS TO CLASS MEMBERS NATIONWIDE................................... 5 A. Annuitization Bonus ............................................................................. 6 B. Enhanced Annuity Payments ................................................................ 7 C. Surrender Charge Reduction Benefits Through the Claim Review Process ..................................................................................... 7 IV. THE COURT SHOULD AWARD THE FULL AMOUNT OF ATTORNEYS’ FEES THAT MIDLAND HAS AGREED TO PAY............ 9 A. Applicable Legal Standards .................................................................. 9 B. Plaintiffs’ Fee Request Is Reasonable Under the Lodestar Method ................................................................................................10 1. Class Counsel’s Hourly Rates Are Reasonable........................10 2. The Number of Hours that Class Counsel Devoted to This Litigation Is Reasonable ...................................................14 3. The Lodestar Calculation..........................................................15 4. Class Counsel’s Fees Are Reasonable Considering the Time and Labor Required, the Novelty and Complexity of the Litigation, Counsel’s Skill and Experience, Results Obtained, and Awards in Similar Cases ...................................16 a. Class Counsel Invested an Enormous Amount of Time and Resources into This Case ...............................16 b. The Litigation Featured Many Novel and Complex Legal and Factual Issues ................................................17 c. Class Counsel Are Highly Skilled and Experienced in Large and Complex Class Action Litigation .............17 d. Class Counsel Obtained an Outstanding Settlement Result for Class Members Nationwide ..........................19 e. The Fees and Expenses Sought Here Are Well Below Those Awarded in Similar Deferred Annuity Actions .............................................................19 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 2 of 39 Page ID #:4206 Page - ii - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5. Plaintiffs’ Fee Request Is Reasonable in Light of the Contingent Nature of the Fee and Class Counsel’s Ongoing Work ..........................................................................20 C. Plaintiffs’ Fee Request Is Also Well Below the Benchmark Percentage Set by the Ninth Circuit....................................................21 V. CLASS COUNSEL’S EXPENSES ARE REASONABLE AND NECESSARILY INCURRED TO ACHIEVE THE BENEFIT OBTAINED ON BEHALF OF THE CLASS...............................................22 VI. THE COURT SHOULD APPROVE THE SERVICE AWARD OF $10,000 FOR EACH CLASS REPRESENTATIVE ....................................24 VII. CONCLUSION .............................................................................................25 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 3 of 39 Page ID #:4207 TABLE OF AUTHORITIES Page - iii - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CASES Anderson v. Nextel Retail Stores, LLC, No. CV 07-4480-SVW(FFMx), 2010 U.S. Dist. LEXIS 71598 (C.D. Cal. June 30, 2010) ..............................................................................................9, 10, 12 B-K Lighting, Inc. v. Vision3 Lighting, No. CV 06-02825 MMM (PLAx), 2009 WL 3838264 (C.D. Cal. Nov. 16, 2009)........................................................................................................11 Blum v. Stenson, 465 U.S. 886, 104 S. Ct. 1541, 79 L. Ed. 2d 891 (1984) ...................................................... 10, 16 Boeing Co. v. Van Gemert, 444 U.S. 472, 100 S. Ct. 745, 62 L. Ed. 2d 676 (1980)...........................................................22 Clark v. Los Angeles, 803 F.2d 987 (9th Cir. 1986)........................................................................................................ 10 Craft v. County of San Bernardino, 624 F. Supp. 2d 1113 (C.D. Cal. 2008) ...................................................................................21 Crommie v. Pub. Utils. Comm’n, 840 F. Supp. 719 (N.D. Cal. 1994) ..........................................................................................17 Fleury v. Richemont N. Am. Inc., No. C-05-4525 EMC, 2008 WL 3287154 (N.D. Cal. Aug. 6, 2008).........................................9 Fresco v. Auto. Directions, Inc., No. 03-CIV-61063 MARTINEZ-SIMONTON, 2009 U.S. Dist. LEXIS 125233 (S.D. Fla. Jan. 16, 2009) .................................................................................13 Gates v. Deukmejian, 987 F.2d 1392 (9th Cir. 1992)................................................................................................ 10, 15 Hanlon v. Chrysler Corp., 150 F.3d 1011 (9th Cir. 1998) ...................................................................................................9 Harris v. Marhoefer, 24 F.3d 16 (9th Cir. 1994) .......................................................................................................23 Hensley v. Eckerhart, 461 U.S. 424, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1983) .............................................................. 10 Hopson v. Hanesbrands Inc., No. CV-08-0844 EDL, 2009 WL 928133 (N.D. Cal. Apr. 3, 2009) .......................................21 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 4 of 39 Page ID #:4208 Page - iv - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Housing Rights Ctr. v. Sterling, No. CV 03-859 DSF, 2005 WL 3320738 (C.D. Cal. Nov. 1, 2005)........................................12 In re Am. Investors Life Ins. Co. Annuity Mktg. & Sales Practices Litig., 263 F.R.D. 226 (E.D. Pa. 2009)............................................................................................. 19, 24 In re Enron Corp. Sec., Derivative & Erisa Litig., 586 F. Supp. 2d 732 (S.D. Tex. 2008) .....................................................................................13 In re Equity Funding Corp. Sec. Litig., 438 F. Supp. 1303 (C.D. Cal. 1977) ........................................................................................18 In re GMC Pick-Up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d 768 (3d Cir. 1995).......................................................................................................21 In re Heritage Bond Litig. v. U.S. Trust Co. of Tex., N.A., No. 02-ML-1475-DT (RCx), 2005 U.S. Dist. LEXIS 13627 (C.D. Cal. June 10, 2005) ........................................................................................................17 In re Ins. Brokerage Antitrust Litig., 579 F.3d 241 (D.N.J. 2009) .....................................................................................................18 In re Ins. Brokerage Antitrust Litig., No. 04-5184 GEB, 2007 WL 1652303 (D.N.J. June 5, 2007).................................................25 In re Mego Fin. Corp. Sec. Litig., 213 F.3d 454 (9th Cir. 2000) ...................................................................................................24 In re Mills Corp. Sec. Litig., No. 06-CV-00077, 2009 WL 5091931 (E.D. Va. Dec. 23, 2009) ...........................................13 In re Prudential Ins. Co. of Am. Sales Practices Litig., 106 F. Supp. 2d 721 (D.N.J. 2000) .............................................................................................. 20 In re Schering-Plough Corp. Sec. Litig., No. 01-cv-0829 KSH/MF, 2009 U.S. Dist. LEXIS 121173 (D.N.J. Dec. 31, 2009) .............................................................................................................13 Jordan v. Multnomah County, 815 F.2d 1258 (9th Cir. 1987) .................................................................................................14 Kerr v. Screen Extras Guild, 526 F.2d 67 (9th Cir. 1975).............................................................................................. 10, 16, 17 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 5 of 39 Page ID #:4209 Page - v - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Lingenfelter v. Astrue, No. SA CV 03-00264-VBK, 2009 WL 2900286 (C.D. Cal. Sept. 3, 2009)..........................................................................................................13 Manners v. Am. Gen’l Life Ins. Co., No. 3-98-0266, 1999 U.S. Dist. LEXIS 22880 (D. Tenn. Aug. 11, 1999) ............................................................................................................. 20 Masters v. Wilhelmina Model Agency, Inc., 473 F.3d 423 (2d Cir. 2007).....................................................................................................22 Mathis v. Spears, 857 F.2d 749 (9th Cir. 1988) ...................................................................................................11 McPhail v. First Command Fin. Planning, Inc., No. 05cv179-IEG-JMA, 2009 WL 839841 (S.D. Cal. Mar. 30, 2009).........................................................................................................21 Paul, Johnson, Alston & Hunt v. Graulty, 886 F.2d 268 (9th Cir. 1989) ...................................................................................................21 People Who Care v. Rockford Bd. of Educ., 90 F.3d 1307 (7th Cir. 1996) ...................................................................................................11 POM Wonderful, LLC v. Purely Juice, Inc., No. CV 07-2633 CAS (JWJx), 2008 WL 4351842 (C.D. Cal. Sept. 22, 2008)........................................................................................................12 Rodriguez v. West Publ’g Corp., 563 F.3d 948 (9th Cir. 2009) ...................................................................................................24 Schwartz v. Sec’y of Health & Human Servs., 73 F.3d 895 (9th Cir. 1995) .....................................................................................................10 Six Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301 (9th Cir. 1990) ...........................................................................................21, 22 Snell v. Allianz Life Ins. Co. of N. Am., No. 97-2784(RLE), 2000 U.S. Dist. LEXIS 13611 (D. Minn. Sept. 8, 2000)............................................................................................................... 20 Staton v. Boeing Co., 327 F.3d 938 (9th Cir. 2003) ...................................................................................................23 Torrisi v. Tucson Elec. Power, 8 F.3d 1370 (9th Cir. 1993) .....................................................................................................21 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 6 of 39 Page ID #:4210 Page - vi - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 United Steelworkers of Am. v. Phelps Dodge Corp., 896 F.2d 403 (9th Cir. 1990) ...................................................................................................11 Van Vraken v. Atl. Richfield Co., 901 F. Supp. 294 (N.D. Cal. 1995) ..........................................................................................24 Varacallo v. Mass. Mut. Life Ins. Co., 226 F.R.D. 207 (D.N.J. 2005) ...................................................................................................... 19 Vizcaino v. Microsoft Corp., 290 F.3d 1043 (9th Cir. 2002) .................................................................................................21 Waters v. Int’l Precious Metals Corp., 190 F.3d 1291 (11th Cir. 1999) ...............................................................................................22 Williams v. MGM-Pathe Commc’ns Co., 129 F.3d 1026 (9th Cir. 1997) .................................................................................................22 Yamonouchi Pharm. Co. v. Danbury Pharmacal., Inc., 51 F. Supp. 2d 302 (S.D.N.Y. 1999)........................................................................................13 Yurman Designs, Inc. v. PAJ, Inc., 125 F. Supp. 2d 54 (S.D.N.Y. 2000)........................................................................................13 STATUTES, RULES AND REGULATIONS Federal Rules of Evidence Rule 706 .....................................................................................................................4, 5, 14, 17 Federal Rules of Civil Procedure Rule 23(h) ..................................................................................................................................9 California Business and Professions Code §17200........................................................................................................................................3 §17500........................................................................................................................................3 SECONDARY AUTHORITIES Thomas E. Willging, Laural L. Hooper & Robert J. Niemic, (Federal Judicial Center 1996) Empirical Study of Class Actions in Four Federal District Courts: Final Report to the Advisory Committee on Civil Rules .........................................................22 Theodore Eisenberg & Geoffrey P. Miller, 53 UCLA L. Rev. 1303 (Aug. 2006) Incentive Awards to Class Action Plaintiffs: An Empirical Study ...........................................24 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 7 of 39 Page ID #:4211 Page - vii - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 William B. Rubenstein, Alba Conte & Herbert B. Newberg, 4 Newberg on Class Actions, Class Member Obligations for Litigation Fees and Expenses (4th ed. 2002) §14:2 ........................................................................................................................................23 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 8 of 39 Page ID #:4212 - 1 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiffs and Class Representatives Mary P. Munoz, Robert D. Kaiser, Mary Bendzak, and Nancy Bendzak, as attorney-in-fact for Mary Bendzak (“Plaintiffs”), respectfully submit this memorandum in support of their motion for an award of attorneys’ fees, reimbursement of expenses and service awards for their and their counsel’s hard work and skill in prosecuting this class action and securing a valuable recovery for all members of the Settlement Class. I. INTRODUCTION The Settlement reached by the Parties provides valuable economic relief for over 70,000 senior citizens across the country who purchased deferred annuities from Midland National Life Insurance Company (“Midland”). After more than four years of litigation, including over six months of hard-fought, arm’s-length settlement negotiations, Class Counsel were able to resolve the classwide claims arising from the sale of Midland deferred annuities to seniors.1 Under the terms of the Settlement, Midland has agreed to provide substantial economic benefits to the Settlement Class in the form of the “Annuitization Bonus,” “Enhanced Annuity Payments,” and “Surrender Charge Reduction Benefits,” the total value of which has been estimated at around $79.5 million. For their dogged efforts in achieving this Settlement,2 Class Counsel hereby seek an award of attorneys’ fees and expenses. Counsel’s efforts to date have been without compensation of any kind and the fee has always been wholly contingent upon the result achieved. Under the Settlement Agreement, Midland has agreed to 1 Pursuant to the Court’s Findings and Order Preliminarily Approving Class Settlement, Directing Issuance of Notice to the Class, and Setting of Fairness Hearing (“Preliminary Approval Order”), dated October 25, 2010, the Court appointed the following firms as Class Counsel: (a) Bonnett, Fairbourn, Friedman & Balint, P.C. (“Bonnett Fairbourn”); (b) Robbins Geller Rudman & Dowd LLP (“Robbins Geller”); (c) Barrack Rodos & Bacine; (d) Finkelstein & Krinsk; (e) Waters & Kraus LLP; (f) James Hoyer Newcomer & Smiljanich, P.A.; and (g) Hagens Berman Sobol Shapiro LLP (“Hagens Berman”). 2 As set forth in the Settlement Agreement, filed with the Court on October 12, 2010, Plaintiffs will file their motion for final approval by the end of January 2011. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 9 of 39 Page ID #:4213 - 2 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 pay Class Counsel’s attorneys’ fees and expenses up to $13,970,000, separate and apart from the relief provided to the Settlement Class. Settlement Agreement, §X.B.1. Indeed, any award of attorneys’ fees and expenses will not in any way affect the form or amount of the benefits available to the Settlement Class. Conversely, any reduction in the fee will not increase benefits to the Settlement Class – it will simply revert to Midland, which has voluntarily agreed to pay the full amount. Importantly, the requested fee amount reflects only a portion of the actual time and labor expended by Class Counsel. Although lodestar multipliers of three to seven are common and appropriate in large, complex class actions such as this, and although a multiplier would be warranted here, Plaintiffs do not in fact seek a multiplier. Here, the fee request of $13,970,000 is significantly less than the lodestar and expenses actually incurred in the case, in effect, resulting in a “negative multiplier.” Moreover, if the fee were computed under a “common fund,” percentage of recovery method, the requested award of $13,970,000 would represent less than 18% of the total value of the settlement benefits available to the Settlement Class, well below the 25% benchmark generally accepted by the Ninth Circuit. Plaintiffs’ fee request is certainly fair and reasonable in light of their counsel’s hard-work, tenacity, and ultimate success in achieving an outstanding result on behalf of the Settlement Class. Class Counsel persisted daily in their efforts to advance the litigation despite the substantial risk of non-payment due to the uncertain outcome and the contingent nature of the work. As the Court is aware, Class Counsel faced numerous challenges in prosecuting the action, not the least among them, the skilled and formidable defense by Midland’s counsel. And, notably, the requested fee does not include the substantial work that Class Counsel must still shoulder before the litigation is completed, such as claims administration, class member communications, and responding to any associated objection and related appeal – further work benefitting the Settlement Class that could easily last for years and which will go uncompensated. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 10 of 39 Page ID #:4214 - 3 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Additionally, Midland has agreed to pay a service award of $10,000 to each Plaintiff (collectively $30,000) for their time and effort in participating in this case as Class Representatives. As with the requested award for attorneys’ fees and expenses, the service award is paid separately and will not affect the amount of relief available to the Settlement Class. The Class Representatives devoted a considerable amount of time and undertook substantial efforts on behalf of the Settlement Class and should be justly recognized for their efforts. For the reasons set forth herein, Plaintiffs respectfully submit that the requested award for attorneys’ fees and expenses and the service award are reasonable under Ninth Circuit case law and, in light of the excellent result achieved on behalf of the Settlement Class, should be fully awarded by this Court pursuant to the Settlement Agreement. II. HISTORY OF THE LITIGATION AND SETTLEMENT As detailed in the Settlement Agreement and the Joint Declaration,3 this action originated as several class actions filed in Los Angeles Superior Court and federal courts in Iowa, California and Florida. Settlement Agreement, §I.A; Joint Decl., ¶¶5- 13. On May 2, 2007, the Judicial Panel for Multidistrict Litigation ordered that the action be centralized and coordinated by this Court under the caption In re Midland National Life Insurance Co. Annuity Sales Practices Litigation, MDL No. 1825. Joint Decl., ¶14. The operative Complaint, filed on June 4, 2007, on behalf of Plaintiffs and all other similarly-situated seniors who purchased Midland deferred annuities, asserted claims under the federal civil RICO statute and certain California consumer protection laws, including California’s Elder Abuse Statute, the Consumer Legal Remedies Act, and Business and Professions Code §§17200 and 17500. The Complaint alleges that 3 Joint Declaration of Andrew S. Friedman and Theodore J. Pintar in Support of Plaintiffs’ Motion for Final Approval of Class Action Settlement Agreement, filed concurrently (“Joint Declaration” or “Joint Decl.”). Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 11 of 39 Page ID #:4215 - 4 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Midland utilized a network of affiliated sales agents in a scheme to target senior consumers and sell them costly and poor performing annuity products with onerous surrender penalties. The Complaint further alleges that Midland misrepresented and otherwise failed to disclose to senior consumers material facts concerning the costs associated with its annuities, the surrender and withdrawal provisions, the fixed maturity dates, and other material facts. Settlement Agreement, §I.B.1(a). Midland has always denied any wrongdoing in connection with the sale and marketing of its deferred annuities. Under the direction and coordination of Interim Co-Lead Counsel, Robbins Geller, Bonnett Fairbourn, and Hagens Berman, Class Counsel worked diligently to develop, prosecute and ultimately settle this action. Class Counsel reviewed more than 450,000 pages of documents, analyzed extensive actuarial and financial data, took numerous depositions of Midland officers, employees, and agents, and conducted expert witness discovery concerning the merits of Plaintiffs’ claims and the defenses raised by Midland. Joint Decl., ¶24. During the course of the litigation, Plaintiffs successfully opposed Midland’s efforts to dismiss the action. Id., ¶10. And, on July 2, 2007, Plaintiffs filed a motion for class certification seeking certification of a California class of seniors for violations of the California Unfair Competition Law and a nationwide class of seniors based on RICO. Id., ¶18. Shortly thereafter, on July 9, 2007, Plaintiffs vigorously opposed Midland’s motion for summary judgment, and later, Midland’s motion to exclude and Daubert challenge to Plaintiffs’ expert, Dr. Craig McCann, which resulted in extensive expert discovery and briefing over a one-year period. Id., ¶¶19-24. Underscoring the complexity and contentious nature of the summary judgment and expert issues, the Court appointed its own expert under Rule 706 of the Federal Rules of Evidence to assess the reliability of the opinions offered by Dr. McCann. Plaintiffs prepared multiple briefs and appeared before the Court multiple times as part of the Rule 706 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 12 of 39 Page ID #:4216 - 5 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 process. The summary judgment and expert motions, as well as the Daubert hearing, were pending at the time this settlement was reached. Id., ¶23. Class Counsel tirelessly litigated this action while attempting, in good faith, to achieve a just, fair and amicable resolution. For more than two years, the Parties engaged in intense, hard-fought settlement negotiations that stalled in 2008, then resumed again in 2009. Id., ¶¶29-31. In addition to direct settlement negotiations, the Parties agreed to mediate the matter initially before Justice Edward Wallin (Ret.) of JAMS and thereafter, Judge Dickran Tevrizian (Ret.) of JAMS, to assist them in resolving difficult issues concerning the settlement structure and the potential benefits to the Settlement Class. The Parties exchanged settlement proposals during this extended process, holding several face-to-face mediation sessions and periodic conference calls, while gradually narrowing the issues to be resolved. Id., ¶¶31-34. In late April 2010, the Parties finally resolved all outstanding terms of settlement during a mediation session with Judge Tevrizian. Id., ¶34. At all times during their discussions, the Parties negotiated at arm’s-length and refrained from discussing attorneys’ fees or expenses until after they finalized all material terms of the relief to be provided to the Settlement Class. Id., ¶¶34-36. Though the negotiations remained hard fought, Midland ultimately agreed to pay up to $13,970,000 in attorneys’ fees and expenses – separate and apart from the Class relief. Id., ¶36; Settlement Agreement, §X.B.1. Moreover, the Parties structured the fee and expense award such that it would not delay disbursement of relief to the Settlement Class. III. THE SETTLEMENT CONFERS SUBSTANTIAL ECONOMIC BENEFITS TO CLASS MEMBERS NATIONWIDE Under the Settlement Agreement, valuable economic relief has been achieved by Class Counsel on behalf of the Settlement Class. The Settlement provides that members of the Settlement Class who choose not to be excluded are eligible to receive tangible economic benefits in the form of either an Annuitization Bonus, Enhanced Annuity Payments, or Surrender Charge Reduction Benefits for those electing to Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 13 of 39 Page ID #:4217 - 6 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 participate in the Claim Review Process. Settlement Agreement, §§IV & V; Joint Decl., ¶¶38-48. Plaintiffs have retained Philip Bieluch, a distinguished actuary with over 35 years of insurance experience, to value the settlement relief available to Class Members.4 After reviewing the terms of the Settlement Agreement and analyzing the class member data provided by Midland, Mr. Bieluch has calculated the present value of each of the settlement benefits, as discussed below. Bieluch Decl., ¶¶2, 4, 17. Based on Mr. Bieluch’s analysis, which is based on sound and conservative actuarial principles, these settlement benefits, collectively, will provide an estimated $79.5 million in economic relief to the Settlement Class. Id., ¶4. A. Annuitization Bonus Class Members with an active deferred annuity (i.e., an annuity that has not been annuitized, surrendered, returned under a “free-look” provision, or otherwise been rescinded, or for which a death benefit has become payable) and who do not seek or otherwise qualify for Surrender Charge Reduction Benefits shall be entitled to receive an Annuitization Bonus. Settlement Agreement, §IV.A-B. For those who elect to receive the Annuitization Bonus and annuitize over a qualifying period (meaning that payments will continue until the later of the annuitant’s death or the expiration of 10 years), Midland will increase the accumulation value of the active deferred annuity by the amount of the applicable bonus, calculated at the time of annuitization. Id., §IV.B.2. The Annuitization Bonus, which directly enhances the economic value of Midland annuities, effectively addresses Plaintiffs’ concerns about the alleged undisclosed costs embedded in the annuities. 4 Mr. Bieluch is a member of the American Academy of Actuaries and former Senior Vice President and Chief Actuary of Hampton RE. See Declaration of Philip J. Bieluch FSA, MAAA, FCA, Estimating Value of Settlement to Class Members in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses, and Service Awards, filed concurrently (“Bieluch Decl.”), ¶5. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 14 of 39 Page ID #:4218 - 7 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Based on his review of the class member data and the application of reasonable actuarial assumptions, Mr. Bieluch estimates that 93% of the active annuity contracts in the Settlement Class qualify for the Annuitization Bonus. Bieluch Decl., ¶13. Mr. Bieluch further considers the average growth in the accumulation value of these contracts, the average withdrawal rate for surrenders and deaths, and a 1% annual utilization rate for the Annuitization Bonus, and based on those metrics, estimates that the Annuitization Bonus alone will provide $41,096,101 in settlement relief. Bieluch Decl., ¶¶14, 17. B. Enhanced Annuity Payments Class Members who have already annuitized their annuity on or prior to the date of entry of the Final Order and Judgment are eligible to receive a 2% increase to each remaining annuity payment made to them after the implementation date, relative to the amount scheduled to be paid in the absence of this Settlement. Settlement Agreement, §IV.C. Mr. Bieluch estimates that around 2% of the active annuity contracts in the Settlement Class have been, or will be, annuitized by the implementation date. The class member data provided by Midland indicates that the total premium for annuitized contracts is $66,502,765. Based on the reasonable actuarial assumption that 75% of the total premium amount, or $49,877,074, remains to be paid out on those annuitized contracts, Mr. Bieluch estimates that the 2% enhancement to the remaining annuity payments will provide $2,822,148 in settlement relief. Bieluch Decl., ¶¶4, 15, 17. C. Surrender Charge Reduction Benefits Through the Claim Review Process Class Members who have not already annuitized their annuities may file claims which, if approved, will provide reductions in past or future surrender charges for their annuities. Settlement Agreement, §V.A.1. These reductions in surrender charges are referred to as Surrender Charge Reduction Benefits. Id. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 15 of 39 Page ID #:4219 - 8 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Class Members who apply for Surrender Charge Reduction Benefits must submit to the Administrator a claim form (included in the class notice package) for the annuity that is the subject of the claim. Id., §V.B & D. Based on the information contained in or submitted with the claim form, the Administrator will determine the Surrender Charge Reduction Benefits, if any, for which each claimant qualifies. Id., §V.C. In evaluating whether a Class Member is entitled to a surrender charge reduction, the Administrator will consider certain factors, particularly: (i) whether there was a misrepresentation concerning the applicable surrender charges, the right to annuitize or other terms; (ii) whether full or potential surrender was necessary to pay for necessities such as medical expenses, nursing or home care, retention of the claimant’s residence, or other essential living expenses; (iii) whether the Class Member’s annual income is less than or equal to $35,000; and/or (iv) whether the accumulation value of the annuity as of the eligibility date is more than 20% of the Class Member’s net worth, or three times the Class Member’s annual income. Id., §V.D.3. Based on the Administrator’s evaluation of the aforementioned factors, claimants may receive surrender charge reductions at two levels, referred to as Upper Tier Benefits and Lower Tier Benefits. Id., §II.A.38 & 54. Claimants who qualify for Upper Tier Benefits will receive a refund of up to 75% of surrender charges incurred prior to the implementation date, or a reduction of up to 75% in any surrender charge incurred on or after the implementation date. Id., §V.A.1. Claimants who qualify for Lower Tier Benefits will receive a refund of up to 40% of surrender charges incurred prior to the implementation date, or a reduction of up to 40% in any surrender charge incurred on or after the implementation date. Id. Based on the number of claims filed to date, Mr. Bieluch estimates that 3.5% of Class Members will qualify for Upper Tier Benefits (75% reduction in surrender charges) and another 3.5% of Class Members will qualify for Lower Tier Benefits (40% reduction in surrender charges), resulting in approximately $35,619,853 in Surrender Charge Reduction relief to the Settlement Class. Bieluch Decl., ¶¶4, 16, 17. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 16 of 39 Page ID #:4220 - 9 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Accordingly, based on Mr. Bieluch’s analysis, the three settlement benefits provide a total of $79,538,102 in potential economic relief to the Settlement Class. Bieluch Decl., ¶¶4, 17. Notably, this amount does not include: (i) the cost of notice to the Settlement Class and expense of settlement administration; (ii) the $30,000 service award for the Class Representatives; and (iii) Class Counsel’s attorneys’ fees and expenses, which the Settlement Class would otherwise be obligated to pay. For their hard work, skill and diligence in securing this valuable economic relief for the Settlement Class, Class Counsel should be awarded the full amount of requested attorneys’ fees and expenses, as agreed upon by the Parties. See Settlement Agreement, §X.B.1. The requested fee award of $13,970,000 is reasonable and fair under both the lodestar and percentage of recovery methods approved by the Ninth Circuit. IV. THE COURT SHOULD AWARD THE FULL AMOUNT OF ATTORNEYS’ FEES THAT MIDLAND HAS AGREED TO PAY A. Applicable Legal Standards Rule 23(h) of the Federal Rules of Civil Procedure provides that “[i]n a certified class action, the court may award reasonable attorney’s fees and nontaxable costs that are authorized by law or by the parties’ agreement.” The Ninth Circuit has long accepted “two separate methods for determining attorneys fees, depending on the case,” the percentage of recovery and lodestar methods. See Hanlon v. Chrysler Corp., 150 F.3d 1011, 1029 (9th Cir. 1998). In common fund cases where the settlement creates a large fund for distribution to the class, a court may assess attorneys’ fees as a percentage of the settlement fund. Id.; Anderson v. Nextel Retail Stores, LLC, No. CV 07-4480-SVW(FFMx), 2010 U.S. Dist. LEXIS 71598, at *4 (C.D. Cal. June 30, 2010). In the absence of a common fund and where, as here, the defendant has agreed to pay attorneys’ fees separate and apart from any relief to the Settlement Class, it is appropriate to determine the fee award using a lodestar analysis. See Hanlon, 150 F.3d at 1029; Fleury v. Richemont N. Am. Inc., No. C-05-4525 EMC, 2008 WL 3287154, at *3 (N.D. Cal. Aug. 6, 2008). Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 17 of 39 Page ID #:4221 - 10 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Under the lodestar method, a reasonable attorneys’ fee is determined by multiplying the number of hours reasonably expended by a reasonable hourly rate. See Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1983). The fee amount calculated under the lodestar method is presumptively reasonable. Anderson, 2010 U.S. Dist. LEXIS 71598, at *4 (citing Gates v. Deukmejian, 987 F.2d 1392, 1397 (9th Cir. 1992)). Here, Plaintiffs’ fee request of $13,970,000 is significantly less than the actual lodestar and expenses incurred by counsel. Considering the time and labor required to successfully prosecute this matter, the novelty and complexity of the issues, the special skill and experience of counsel, the quality of the representation, the results obtained, and awards in similar cases, the requested award is plainly reasonable and fair. Clark v. Los Angeles, 803 F.2d 987, 991 n.3 (9th Cir. 1986) (citing Blum v. Stenson, 465 U.S. 886, 898-900, 104 S. Ct. 1541, 79 L. Ed. 2d 891 (1984)); Kerr v. Screen Extras Guild, 526 F.2d 67, 70 (9th Cir. 1975). Moreover, the reasonableness of Plaintiffs’ fee request is confirmed when analyzed under the percentage of recovery method. Anderson, 2010 U.S. Dist. LEXIS 71598, at *4. Indeed, the requested award represents less than 18% of the total value of the settlement benefits achieved for the Settlement Class, well below the 25% benchmark accepted by the Ninth Circuit. B. Plaintiffs’ Fee Request Is Reasonable Under the Lodestar Method 1. Class Counsel’s Hourly Rates Are Reasonable Under the lodestar method, reasonable hourly rates are determined by the “‘prevailing market rates in the relevant community,’” which are the rates a lawyer of comparable skill, experience and reputation could command in the relevant community. Anderson, 2010 U.S. Dist. LEXIS 71598, at *6 (citing Blum, 465 U.S. 886). The relevant community is that in which the court sits, here the Central District of California. Schwartz v. Sec’y of Health & Human Servs., 73 F.3d 895, 906 (9th Cir. 1995). Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 18 of 39 Page ID #:4222 - 11 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 An attorney’s actual billing rate is presumptively appropriate to use as the lodestar market rate. See People Who Care v. Rockford Bd. of Educ., 90 F.3d 1307, 1310 (7th Cir. 1996). “Affidavits of the plaintiffs’ attorney and other attorneys regarding prevailing fees in the community, and rate determinations in other cases, particularly those setting a rate for the plaintiffs’ attorney, are satisfactory evidence of the prevailing market rate.” United Steelworkers of Am. v. Phelps Dodge Corp., 896 F.2d 403, 407 (9th Cir. 1990). “Courts also frequently use survey data in evaluating the reasonableness of attorneys’ fees.” B-K Lighting, Inc. v. Vision3 Lighting, No. CV 06-02825 MMM (PLAx), 2009 WL 3838264, at *5 (C.D. Cal. Nov. 16, 2009) (citing Mathis v. Spears, 857 F.2d 749, 755-56 (9th Cir. 1988)). Plaintiffs here have submitted sworn declarations by their counsel, attesting to their hourly rates and total hours devoted to the case, their experience, and describing their efforts to prosecute this case.5 The hourly rates submitted by Class Counsel reflect their actual billing rates; thus, they are presumptively appropriate. Class Counsel are highly-respected members of the bar with extensive experience in prosecuting high-stakes complex litigation, including consumer class actions. Joint Decl., ¶¶58-59; see also Co-Counsel Decls., Exs. A, 1. Table 1 sets forth the hourly rates, total hours worked and fee amounts for each of the law firms involved in the 5 See Declaration of Theodore J. Pintar in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Expenses and Incentive Award, filed concurrently (“Pintar Decl.”), ¶¶3-6; Declaration of Andrew S. Friedman in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses and Incentive Award, filed concurrently (“Friedman Decl.”), ¶¶4-7; Declaration of Jeffrey R. Krinsk in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses and Incentive Award, filed concurrently (“Krinsk Decl.”), ¶¶3-6; Declaration of Ingrid M. Evans in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses and Incentive Award Payments, filed concurrently (“Evans Decl.”), ¶¶5-8; Declaration of John A. Yanchunis in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses and Incentive Award, filed concurrently (“Yanchunis Decl.”), ¶¶3-6; Declaration of Stephen R. Basser in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses and Incentive Award, filed concurrently (“Basser Decl.”), ¶¶3-6; Declaration of Elizabeth A. Fegan in Support of Plaintiffs’ Motion for an Award of Attorneys’ Fees, Reimbursement of Expenses and Incentive Award, filed concurrently (“Fegan Decl.”), ¶¶3-6 (collectively, “Co-Counsel Decls.”). Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 19 of 39 Page ID #:4223 - 12 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 prosecution of this action. Class Counsel’s rates are appropriate for complex, nationwide litigation and reflect a high level of experience and skill necessary for success in this action.6 TABLE 1 Class Counsel’s Hourly Rates and Hours Worked Prosecuting Firm Range of Attorney Hourly Rates Total Hours Lodestar Amount7 Robbins Geller Rudman & Dowd LLP $305.00 to $795.00 11,132.50 $4,998,537.50 Bonnett Fairbourn Friedman & Balint, P.C. $180.00 to $650.00 8,641.90 $3,950,930.50 Hagens Berman Sobol Shapiro LLP $250.00 to $650.00 5,860.20 $2,275,785.00 Finkelstein & Krinsk LLP $325.00 to $525.00 3,828.55 $1,618,954.25 Waters Kraus & Paul $375.00 to $700.00 1,959.47 $808,833.05 Barrack Rodos & Bacine $275.00 to $700.00 3,584.25 $1,594,328.75 James, Hoyer, Newcomer, Smiljanich & Yanchunis, P.A. $400.00 to $600.00 1,961.90 $805,169.00 Total 36,968.77 $16,052,538.05 See Co-Counsel Decls., ¶¶3-8. Class Counsel’s hourly rates are comparable to those approved in this District. See, e.g., Housing Rights Ctr. v. Sterling, No. CV 03-859 DSF, 2005 WL 3320738, at *2 (C.D. Cal. Nov. 1, 2005) (noting hourly rates may run up to $1,000.00 per hour in L.A., with $125.00 to $650.00 routine in California); Anderson, 2010 U.S. Dist. LEXIS, at *10-*12; POM Wonderful, LLC v. Purely Juice, Inc., No. CV 07-2633 CAS (JWJx), 2008 WL 4351842, at *4 (C.D. Cal. Sept. 22, 2008) (approving partner rates 6 As set forth in the declarations of Class Counsel, the rates range from $180.00 to $540.00 per hour for associates and from $400.00 to $795.00 per hour for partners, with the high-end reserved for only the most senior attorneys on the case. 7 Total hours and lodestar amount include work performed by the litigation support staff at each firm. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 20 of 39 Page ID #:4224 - 13 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of $475.00 to $750.00 and associate rates of $275.00 to $425.00); Lingenfelter v. Astrue, No. SA CV 03-00264-VBK, 2009 WL 2900286, at *4 (C.D. Cal. Sept. 3, 2009) ($600.00 is “reasonable”). Survey data also supports the reasonableness of the rates sought. Each year, the National Law Journal issues a survey of prevailing hourly rates. Courts rely on this annual survey as evidence of prevailing hourly rates. See, e.g., Yurman Designs, Inc. v. PAJ, Inc., 125 F. Supp. 2d 54, 58 (S.D.N.Y. 2000); Yamonouchi Pharm. Co. v. Danbury Pharmacal., Inc., 51 F. Supp. 2d 302, 305 (S.D.N.Y. 1999). Class Counsel’s rates are comparable to the rates of California law firms in the National Law Journal’s 2010 survey. See Pintar Decl., Ex. B (2010 National Law Journal Billing Survey) (partners in Los Angeles firms charge up to $850.00 per hour). Notably, Class Counsel’s customary rates have been previously approved by the courts. See In re Enron Corp. Sec., Derivative & Erisa Litig., 586 F. Supp. 2d 732, 778-80, 804-05 (S.D. Tex. 2008) (approving Robbins Geller’s hourly rates after specifically reviewing them for reasonableness); In re Schering-Plough Corp. Sec. Litig., No. 01-cv-0829 KSH/MF, 2009 U.S. Dist. LEXIS 121173, at *15-*16 (D.N.J. Dec. 31, 2009) (approving 1.5 multiplier of Barrack Rodos’ lodestar); In re Mills Corp. Sec. Litig., No. 06-CV-00077, 2009 WL 5091931, at *20 (E.D. Va. Dec. 23, 2009) (approving hourly average rate of $402.00 per hour for group of lead plaintiffs’ counsel, including Barrack Rodos); Fresco v. Auto. Directions, Inc., No. 03-CIV- 61063 MARTINEZ-SIMONTON, 2009 U.S. Dist. LEXIS 125233, at *27-*28 (S.D. Fla. Jan. 16, 2009) (approving customary hourly rates of various partners and associates at James, Hoyer, Newcomer & Smiljanich, P.A.). Class Counsel’s hourly rates, which are on par with the prevailing market rates of attorneys in this District, are reasonable, particularly given counsel’s demonstrated skill, experience and reputation in the area of complex class action litigation. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 21 of 39 Page ID #:4225 - 14 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2. The Number of Hours that Class Counsel Devoted to This Litigation Is Reasonable Class Counsel have devoted a considerable amount of time and effort pursuing this litigation on behalf of over 70,000 Class Members on a nationwide basis, as documented by the supporting declarations submitted by each prosecuting firm. Since its inception, Class Counsel have collectively spent a total of 36,968.77 hours of attorney and litigation support time to this four-year litigation. Considering the complexity of the RICO and the consumer protection claims asserted, the duration of the litigation, and the scope of the proposed classes, the total number of hours worked by Class Counsel is reasonable. See Jordan v. Multnomah County, 815 F.2d 1258, 1263 (9th Cir. 1987) (lodestar calculation requires court to determine that time spent by counsel was reasonably necessary). The extensive and persistent efforts of counsel to bring this litigation to a successful resolution are described at length and in detail in the Joint Declaration and Co-Counsel Declarations. See Joint Decl., ¶¶5-37; Co-Counsel Decls., ¶¶3-8. As detailed therein, Class Counsel conducted an extensive investigation of the legal and factual issues involved in this case. This extensive fact discovery included the depositions of 11 corporate executives and designated witnesses, depositions of 8 expert witnesses, 4 sets of document requests (totaling 137 requests) covering a wide array of subject matter areas, and subpoenas to numerous actuarial and financial consultants and insurance agents affiliated with Midland. Joint Decl., ¶¶24-28. These efforts resulted in the production of more than 450,000 pages of documents and a voluminous amount of electronic discovery. Id., ¶24. Class Counsel also briefed complex issues arising from the motion for class certification, as well as Midland’s motion to dismiss, motion for summary judgment, and motion to exclude the declaration of Plaintiffs’ expert, Dr. Craig J. McCann. Id., ¶¶9, 10, 18-23. Plaintiff also submitted multiple briefs and appeared multiple times before the Court as part of the Rule 706 independent expert process, which spanned Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 22 of 39 Page ID #:4226 - 15 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 more than a year. Id., ¶¶20-23. Finally, Class Counsel engaged in extensive arm’s- length negotiations with Midland over many months to achieve the proposed Settlement. Id., ¶¶29-34. This included numerous mediation sessions with Judge Tevrizian after preliminary mediation sessions with Justice Wallin, along with direct settlement discussions with defense counsel. Id. Class Counsel endeavored throughout the litigation to delegate and coordinate the efforts of counsel so as to maximize the impact of their collective resources, while minimizing duplication of efforts and streamlining the prosecution of the case. Shortly after the action was filed, Class Counsel sought to ensure the orderly prosecution and efficient representation for the Class by moving for an order appointing Interim Co- Lead Class Counsel. Id., ¶15. The Court appointed two firms, Coughlin Stoia Geller Rudman & Robbins LLP (now Robbins Geller) and Bonnett Fairbourn as Interim Co- Lead Class Counsel, and Hagens Berman also assumed Co-Lead Class Counsel duties. These three firms carefully supervised and managed the efforts of the other Class Counsel, consulted all counsel concerning litigation strategies and positions, assigned discrete tasks to various counsel and kept Plaintiffs and counsel abreast of all developments in the litigation and settlement negotiations. Id. The hours that Class Counsel devoted to this case were reasonable and necessary. Their hard work and commitment have ultimately paid off, as it allowed Interim Co-Lead Counsel to adequately prepare and represent the interests of the Class Members in the litigation and during the hard-fought settlement negotiations with Midland. 3. The Lodestar Calculation Multiplying the hours spent by Class Counsel and their litigation support staff on the litigation by their respective hourly rates yields a lodestar calculation of $16.05 million. See Joint Decl., ¶59 (Table 1); Co-Counsel Decls., ¶¶3-8. The lodestar amount, which again is “strongly presumed” to be reasonable, exceeds the award of $13,970,000 sought by Plaintiffs and agreed upon by Midland. Gates, 987 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 23 of 39 Page ID #:4227 - 16 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 F.2d at 1397. Plaintiffs therefore are seeking a fee award that covers only a portion of their total time and expenses – effectively, a negative multiplier. Notwithstanding the fact that Plaintiffs’ fee request is much lower than their presumptively reasonable lodestar, the factors set forth by the Supreme Court in Blum, 465 U.S. at 898-900, and the Ninth Circuit in Kerr, 526 F.2d 67, also dictate that Plaintiffs be awarded the full amount requested. 4. Class Counsel’s Fees Are Reasonable Considering the Time and Labor Required, the Novelty and Complexity of the Litigation, Counsel’s Skill and Experience, Results Obtained, and Awards in Similar Cases In considering the reasonableness of attorneys’ fees, the Ninth Circuit has directed courts to consider the time and labor required, novelty and complexity of the litigation, skill and experience of counsel, the results obtained, and awards in similar cases. Blum, 465 U.S. at 898-900; Kerr, 526 F.2d at 70. All of these factors weigh heavily in favor of granting the full award of $13,970,000 in fees and expenses here. a. Class Counsel Invested an Enormous Amount of Time and Resources into This Case To date, Class Counsel and their litigation support staff have expended nearly 37,000 hours, totaling $16.05 million in lodestar, and incurred almost $1.89 million in expenses prosecuting this litigation for the benefit of the Settlement Class. Joint Decl., ¶¶59, 70; Co-Counsel Decls., ¶¶6-8. As discussed above and in the Joint Declaration, Class Counsel vigorously litigated the case for nearly four years and were challenged by aggressive, skilled and well-funded defense counsel nearly every step of the way. See generally Joint Decl. To effectively prosecute this very large and complex class action, Class Counsel had to commit a significant amount of time, personnel and expenses to this litigation on a contingency basis with absolutely no guarantee of being compensated in the end. Despite the significant risks and uncertainty, Class Counsel obtained an outstanding result on behalf of seniors nationwide who purchased Midland annuities. Again, the requested fee award does Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 24 of 39 Page ID #:4228 - 17 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 not cover Plaintiffs’ lodestar amount and reflects only a portion of the total, actual fees incurred by counsel in prosecuting this action. b. The Litigation Featured Many Novel and Complex Legal and Factual Issues Many of the core issues that Plaintiffs faced in this litigation were novel and complex, including, for example, the appropriate standard for demonstrating proximate causation under RICO, the legal measure of damages under RICO and California’s Unfair Competition Law statute, the admissibility and use of expert testimony to show causation and damages, the existence of a RICO “enterprise,” and the appropriate financial methods of valuing a deferred annuity contract. Joint Decl., ¶64. Indeed, due in large part to the complexity of these issues, the Court appointed an independent expert under Rule 706 of the Federal Rules of Evidence to assist it in evaluating the proffered opinions of the Parties’ experts made in connection with Midland’s motion for summary judgment and accompanying motion to exclude Dr. McCann, and Daubert challenge. Id., ¶¶21, 64. c. Class Counsel Are Highly Skilled and Experienced in Large and Complex Class Action Litigation The Court also should consider the experience, skill and reputation of Class Counsel. See Kerr, 526 F.2d at 70; In re Heritage Bond Litig. v. U.S. Trust Co. of Tex., N.A., No. 02-ML-1475-DT (RCx), 2005 U.S. Dist. LEXIS 13627, at *38 (C.D. Cal. June 10, 2005); Crommie v. Pub. Utils. Comm’n, 840 F. Supp. 719, 725 (N.D. Cal. 1994). It took a great deal of skill and experience to achieve the proposed settlement for the benefit of the Settlement Class. Class Counsel are well-respected leaders in the fields of consumer and class action litigation. See Joint Decl., ¶¶58-59; Co- Counsel Decls., Exs. A, 1. From the outset, Class Counsel used their expertise and skill to obtain the maximum recovery for the Settlement Class. Class Counsel launched a thorough investigation and consulted and retained numerous experts to Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 25 of 39 Page ID #:4229 - 18 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 assist in the evaluation of Midland’s deferred annuity policies. Ultimately, Plaintiffs collectively dedicated many years to successfully prosecuting this action. During the litigation, Plaintiffs defeated Midland’s motion to dismiss, prepared their motion for class certification, conducted extensive discovery and document review, and negotiated a comprehensive settlement on behalf of the Settlement Class. See generally Joint Decl. Had this Settlement not been achieved, complex legal questions would have continued to be the subject of debate. At no time has Midland ever conceded liability, the appropriateness of class certification, or the existence of causation or damages. Moreover, the Court intended to hold a lengthy, three-day Daubert hearing at which the Parties would have presented testimony and evidence regarding the admissibility of Plaintiffs’ expert’s testimony. That hearing would have been followed by a hearing on Midland’s motion for summary judgment, as well as additional briefing on Plaintiffs’ motion for class certification. Given the significant risks and uncertainty associated with this complex class action, it is a testament to Class Counsel’s skill, creativity and determination that they were able to negotiate an excellent settlement providing substantial economic relief to all Class Members. See, e.g., In re Ins. Brokerage Antitrust Litig., 579 F.3d 241, 281 (D.N.J. 2009) (considering skill and efficiency of attorneys involved). The quality of opposing counsel should also be considered. See, e.g., In re Equity Funding Corp. Sec. Litig., 438 F. Supp. 1303, 1337 (C.D. Cal. 1977). Here, counsel for Midland – Reed Smith LLP – is a nationally recognized law firm in the defense of class actions in general and the defense of class actions involving the marketing and sale of deferred annuities, in particular. See, e.g., Pintar Decl., Ex. C (Reed Smith attorney profile for Robert D. Phillips, Jr.). Class Counsel have vigorously litigated, and defense counsel have vigorously defended against, the classwide claims asserted by Plaintiffs. Indeed, virtually every point in this litigation has been disputed by counsel for Midland. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 26 of 39 Page ID #:4230 - 19 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 d. Class Counsel Obtained an Outstanding Settlement Result for Class Members Nationwide In light of the looming risks and uncertain outcome of the litigation, the results obtained for the class are outstanding. As discussed in §III, Plaintiffs have achieved a large and meaningful settlement that provides Class Members tangible economic benefits relating to their Midland annuities in the form of an Annuitization Bonus, Enhanced Annuity Payments, or Surrender Charge Reduction Benefits. Settlement Agreement, §§IV & V. This settlement relief is indeed valuable – worth close to $79.5 million in the aggregate – and substantial as to each Class Member receiving relief. Bieluch Decl., ¶¶4, 17. e. The Fees and Expenses Sought Here Are Well Below Those Awarded in Similar Deferred Annuity Actions Plaintiffs’ fee request is also reasonable in light of fees awarded in other similar cases involving the sale of insurance products, including actions involving the sale of the deferred annuities to senior citizens. As an example, in In re Am. Investors Life Ins. Co. Annuity Mktg. & Sales Practices Litig., 263 F.R.D. 226 (E.D. Pa. 2009), an action involving the fraudulent sale of deferred annuities to seniors, the defendant insurance company recently agreed to settle the case by providing the class with similar relief, although not as strong, to that provided by the Settlement here. Compare id. at 231, with Settlement Agreement, §IV.A-C & §V. A-D. In American Investors, defendant agreed to provide either a bonus or a payment based upon the surrender charges, if any, previously incurred by the policy owners. Am. Investors, 263 F.R.D. at 245. Based upon the value of that settlement, the court awarded plaintiffs’ counsel $17,699,840 in attorneys’ fees and $550,159 for expenses incurred. Id. The fee award represented a multiplier of 2.3 times counsel’s lodestar of $7,942,757. Id. Similar amounts have been awarded in litigation involving the improper marketing and sale of insurance products. Varacallo v. Mass. Mut. Life Ins. Co., 226 Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 27 of 39 Page ID #:4231 - 20 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 F.R.D. 207, 255 (D.N.J. 2005) (applying a 2.83 multiplier in awarding $58.2 million in attorneys’ fees on total recovery of $698 million of life insurance policyholder benefits); Snell v. Allianz Life Ins. Co. of N. Am., No. 97-2784(RLE), 2000 U.S. Dist. LEXIS 13611, at *20 (D. Minn. Sept. 8, 2000) (awarding $6.6 million in attorneys’ fees for 11,000 hours of attorney time totaling $3.2 million under a lodestar approach); In re Prudential Ins. Co. of Am. Sales Practices Litig., 106 F. Supp. 2d 721 (D.N.J. 2000) (awarding $90 million in attorneys’ fees for recovery totaling $1.8 billion in policyholder benefits); Manners v. Am. Gen’l Life Ins. Co., No. 3-98-0266, 1999 U.S. Dist. LEXIS 22880, at *84-*88 (D. Tenn. Aug. 11, 1999) (awarding $19.5 million, or 11.5% of the economic value of the settlement, in attorneys’ fees in an action alleging misleading sales practices in connection with sale of whole life policies). Here, Class Counsel have achieved an outstanding settlement on behalf of seniors all over the country who purchased Midland annuities, and their fee request is wholly in line with awards granted in similar insurance class actions cases. And, again, Plaintiffs seek an amount that is much lower than the fees and expenses actually incurred by counsel in the prosecution of this action. 5. Plaintiffs’ Fee Request Is Reasonable in Light of the Contingent Nature of the Fee and Class Counsel’s Ongoing Work Finally, Plaintiffs’ fee request is reasonable in light of all of the future work and expenses that will be incurred by Class Counsel under the settlement, which will not be included in their current lodestar. This includes all post-approval work such as claims administration, class member communications, any claims dispute, appeals, and any other issues that may arise under the Settlement Agreement. This future work is substantial and could potentially last for years, and it will further increase the current negative multiplier. In sum, Plaintiffs’ request for an award of $13,970,000 is reasonable and fair, considering the time and labor required to litigate the case, the novelty and complexity Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 28 of 39 Page ID #:4232 - 21 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of the litigation, the skill and experience of counsel, the valuable settlement relief ultimately obtained on behalf of Class Members, and awards in similar cases. The requested award is not based on any multiplier and, in fact, reflects only a portion of Class Counsel’s actual lodestar and expenses. Importantly, any award of fees and expenses will not in any way affect the form or amount of the settlement relief and economic benefits provided to Class Members under the Settlement Agreement. Settlement Agreement, §X.B. The Court should grant the full amount of the fee award, as agreed upon by the Parties. C. Plaintiffs’ Fee Request Is Also Well Below the Benchmark Percentage Set by the Ninth Circuit Plaintiffs’ fee request, which is plainly reasonable under a lodestar analysis, is also firmly supported under a common fund, percentage of recovery analysis. “Courts have relied on ‘common fund’ principles and the inherent management powers of the court to award fees to lead counsel in cases that do not actually generate a common fund.” In re GMC Pick-Up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d 768, 821 (3d Cir. 1995); see also Hopson v. Hanesbrands Inc., No. CV-08-0844 EDL, 2009 WL 928133, at *11 (N.D. Cal. Apr. 3, 2009) (citing Paul, Johnson, Alston & Hunt v. Graulty, 886 F.2d 268, 272 (9th Cir. 1989)). Plaintiffs in the Ninth Circuit are normally entitled to an award for attorney fees of a benchmark percentage of 25% of the common fund, but courts have found fee awards of up to 30% to be reasonable. Graulty, 886 F.2d at 272; see also Torrisi v. Tucson Elec. Power, 8 F.3d 1370, 1376 (9th Cir. 1993) (reaffirming 25% benchmark); Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1050 (9th Cir. 2002) (28%); Six Mexican Workers v. Ariz. Citrus Growers, 904 F.2d 1301, 1311 (9th Cir. 1990) (25%); McPhail v. First Command Fin. Planning, Inc., No. 05cv179-IEG-JMA, 2009 WL 839841, at *7 (S.D. Cal. Mar. 30, 2009) (30% for first $10 million and 25% for additional $2 million settlement); Craft v. County of San Bernardino, 624 F. Supp. 2d 1113, 1123 (C.D. Cal. 2008) (25%); accord Thomas E. Willging, Laural L. Hooper & Robert J. Niemic, Empirical Study of Class Actions Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 29 of 39 Page ID #:4233 - 22 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 in Four Federal District Courts: Final Report to the Advisory Committee on Civil Rules, 69 (Federal Judicial Center 1996) available at http://ftp.resource.org/courts.gov/ fjc/rule23.pdf (“[m]edian rate[] range[] from 27% to 30%”). In determining the amount of the benefit conferred upon a class, the appropriate measure is the total recovery available for that class, not the amount actually claimed by class members after-the-fact. Boeing Co. v. Van Gemert, 444 U.S. 472, 480-81, 100 S. Ct. 745, 62 L. Ed. 2d 676 (1980); see also Williams v. MGM-Pathe Commc’ns Co., 129 F.3d 1026, 1027 (9th Cir. 1997) (holding district court abused its discretion in basing fees on class members’ claims against fund rather than on a percentage of entire fund); Six Mexican Workers, 904 F.2d at 1311 (benchmark is 25% of entire fund). This is because the entire settlement is created through the efforts of class counsel for the benefit of the entire class. Masters v. Wilhelmina Model Agency, Inc., 473 F.3d 423, 437 (2d Cir. 2007) (citing Williams, 129 F.3d at 1027); see also Waters v. Int’l Precious Metals Corp., 190 F.3d 1291, 1297 (11th Cir. 1999) (finding that fees should be based on entire settlement because class counsel’s negotiation of $40 million settlement was beneficial to entire class regardless of fact that a reduced number of claims were made). Here, the Settlement, through the three forms of settlement benefits available to Class Members, provides an estimated $79.5 million in economic relief. Bieluch Decl., ¶¶4, 17. Plaintiffs’ requested award of $13,970,000 represents less than 18% of the value of the available settlement relief. This is much less than the benchmark 25% typically allowed by this Circuit. Clearly, Plaintiffs’ request for fees and expenses is reasonable and fair under the percentage of recovery analysis. V. CLASS COUNSEL’S EXPENSES ARE REASONABLE AND NECESSARILY INCURRED TO ACHIEVE THE BENEFIT OBTAINED ON BEHALF OF THE CLASS Included within the $13,970,000 sought by Plaintiffs to be awarded to Class Counsel are significant expenses incurred in connection with the prosecution of this Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 30 of 39 Page ID #:4234 - 23 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 class action. The Ninth Circuit allows recovery of pre-settlement litigation costs in the context of class action settlements. See Staton v. Boeing Co., 327 F.3d 938, 974 (9th Cir. 2003); see also William B. Rubenstein, Alba Conte & Herbert B. Newberg, 4 Newberg on Class Actions, Class Member Obligations for Litigation Fees and Expenses §14:2 at 510-511 (4th ed. 2002). All expenses that are typically billed by attorneys to paying clients in the marketplace are compensable. Harris v. Marhoefer, 24 F.3d 16, 19 (9th Cir. 1994). Class Counsel have submitted separate declarations attesting to the accuracy of their expenses. Class Counsel have incurred expenses in the aggregate amount of $1.89 million over more than four years spent prosecuting this litigation. See Joint Decl., ¶70; Pintar Decl., ¶5; Co-Counsel Decls., ¶¶6-9. As detailed in the Joint Declaration and Co-Counsel Declarations, Class Counsel incurred substantial costs on experts, discovery, consultants, travel, computer research, motion practice, photocopies, postage, filing fees, transcripts, and telephone charges. Joint Decl., ¶¶70-73; Co-Counsel Decls., ¶¶6-9. Class Counsel were required to travel in connection with this litigation and thus incurred the related costs of airfare, meals, lodging and transportation. Since many of the witnesses were located in Iowa, the site of Midland’s primary business operations, Class Counsel traveled extensively to conduct depositions. Joint Decl., ¶72. Counsel also traveled to Los Angeles on numerous occasions to appear before the Court for hearings and attend mediation. Id. In addition, Class Counsel incurred the costs of computerized research. These are also charges for computerized factual and legal research services including LEXIS and Westlaw. It is standard practice for attorneys to use these services to assist them in researching legal and factual issues. A significant component of Class Counsel’s expenses were the cost of experts and consultants, which were necessary given the difficult and complex financial and actuarial issues presented in this action. Id., ¶71; Co-Counsel Decls., ¶¶6-9. Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 31 of 39 Page ID #:4235 - 24 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 All of these costs were necessary and reasonably incurred to bring this case to a successful conclusion, and they reflect market rates for the various categories of expenses incurred. See Pintar Decl., ¶¶6-7; Co-Counsel Decls., ¶¶6-9. VI. THE COURT SHOULD APPROVE THE SERVICE AWARD OF $10,000 FOR EACH CLASS REPRESENTATIVE For their service and long-term commitment as Class Representatives, Robert Kaiser, Mary Munoz and Mary Bendzak respectfully request that the Court approve a service award of $10,000 for each of them (totaling $30,000). “Incentive awards are fairly typical in class action cases.” Rodriguez v. West Publ’g Corp., 563 F.3d 948, 958 (9th Cir. 2009); Theodore Eisenberg & Geoffrey P. Miller, Incentive Awards to Class Action Plaintiffs: An Empirical Study, 53 UCLA L. Rev. 1303 (Aug. 2006) (30% of class actions include incentive awards to class representatives). In the Ninth Circuit, incentive awards “compensate class representatives for work done on behalf of the class, to make up for financial or reputational risk undertaken in bringing the action, and, sometimes, to recognize their willingness to act as a private attorney general.” Rodriguez, 563 F.3d at 958-59. A court has discretion to approve incentive awards based on, inter alia, the amount of time and effort spent, the duration of the litigation, and the personal benefit (or lack thereof) as a result of the litigation. See Van Vraken v. Atl. Richfield Co., 901 F. Supp. 294, 299 (N.D. Cal. 1995). Here, each of the Class Representatives spent a significant amount of time assisting in the litigation of this action. Among other things, they: (i) assisted Class Counsel in gathering facts so that counsel could develop potential legal claims against Midland; (ii) prepared and testified at depositions; and (iii) assisted Class Counsel in responding to multiple sets of discovery requests from defendant, including numerous requests for production of documents. Joint Decl., ¶¶5-28. The amount requested here per Class Representative is comparable to the amount awarded in other cases. See, e.g., Am. Investors, 263 F.R.D. 3d at 245 (approving incentive awards of $10,500); In re Mego Fin. Corp. Sec. Litig., 213 F.3d Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 32 of 39 Page ID #:4236 - 25 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 454, 457, 463 (9th Cir. 2000) (approving incentive award of $5,000); In re Ins. Brokerage Antitrust Litig., No. 04-5184 GEB, 2007 WL 1652303, at *11 (D.N.J. June 5, 2007) (approving incentive award of $10,000). The Class Representatives’ efforts and time should not go unrecognized. Plaintiffs respectfully request that the Court approve the service award in the collective amount of $30,000 to be allocated equally among them. VII. CONCLUSION For the foregoing reasons, Plaintiffs respectfully request that the Court award Class Counsel $13,970,000 in attorneys’ fees and expenses, and award each of the Plaintiffs Robert Kaiser, Mary Munoz and Mary Bendzak $10,000 ($30,000 cumulatively) for their time and effort as Class Representatives in this successful action. Respectfully submitted, DATED: December 30, 2010 ROBBINS GELLER RUDMAN & DOWD LLP JOHN J. STOIA, JR. THEODORE J. PINTAR RACHEL L. JENSEN PHONG L. TRAN STEVEN M. JODLOWSKI s/ Theodore J. Pintar THEODORE J. PINTAR 655 West Broadway, Suite 1900 San Diego, CA 92101 Telephone: 619/231-1058 619/231-7423 (fax) DATED: December 30, 2010 BONNETT, FAIRBOURN, FRIEDMAN & BALINT, P.C. ANDREW S. FRIEDMAN KIMBERLY C. PAGE s/ Andrew S. Friedman ANDREW S. FRIEDMAN 2901 N. Central Avenue, Suite 1000 Phoenix, AZ 85012 Telephone: 602/274-1100 602/274-1199 (fax) Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 33 of 39 Page ID #:4237 - 26 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BONNETT, FAIRBOURN, FRIEDMAN & BALINT, P.C. MANFRED MUECKE 501 W. Broadway, Suite 1450B San Diego, CA 92101 Telephone: 619/756-7748 HAGENS BERMAN SOBOL SHAPIRO LLP STEVE W. BERMAN 1918 8th Avenue, Suite 3300 Seattle, WA 98101 Telephone: 206/623-7292 206/623-0594 (fax) Interim Co-Lead Class Counsel for Plaintiffs SHERNOFF BIDART & DARRAS WILLIAM M. SHERNOFF JOEL A. COHEN EVANGELINE F. GARRIS 600 South Indian Hill Blvd. Claremont, CA 91711 Telephone: 909/621-4935 909/ 625-6915 (fax) FINKELSTEIN & KRINSK LLP HOWARD D. FINKELSTEIN MARK L. KNUTSON 501 West Broadway, Suite 1250 San Diego, CA 92101 Telephone: 619/238-1333 619/238-5425 (fax) BARRACK, RODOS & BACINE STEPHEN R. BASSER 402 West Broadway, Suite 850 San Diego, CA 92101 Telephone: 619/230-0800 619/230-1874 (fax) JAMES, HOYER, NEWCOMER & SMILJANICH, P.A. JOHN A. YANCHUNIS 4830 West Kennedy Blvd. Urban Centre One, Suite 550 Tampa, FL 33609 Telephone: 813/286-4100 813/286-4174 (fax) Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 34 of 39 Page ID #:4238 - 27 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 WATERS KRAUS & PAUL LLP INGRID M. EVANS 711 Van Ness Avenue, Suite 220 San Francisco, CA 94102 Telephone: 800/226-9880 214/777-0470 (fax) Additional Counsel for Plaintiffs ECF CERTIFICATION The filing attorney attests that he has obtained concurrence regarding the filing of this document from the signatories to this document. Dated: December 30, 2010 By: s/Theodore J. Pintar THEODORE J. PINTAR Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 35 of 39 Page ID #:4239 - 28 - 590664_1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CERTIFICATE OF SERVICE I hereby certify that on December 30, 2010, I authorized the electronic filing of the foregoing with the Clerk of the Court using the CM/ECF system which will send notification of such filing to the e-mail addresses denoted on the attached Electronic Mail Notice List, and I hereby certify that I caused to be mailed the foregoing document or paper via the United States Postal Service to the non-CM/ECF participants indicated on the attached Manual Notice List. I certify under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on December 30, 2010. s/ Theodore J. Pintar THEODORE J. PINTAR ROBBINS GELLER RUDMAN & DOWD LLP 655 West Broadway, Suite 1900 San Diego, CA 92101-3301 Telephone: 619/231-1058 619/231-7423 (fax) E-mail: TedP@rgrdlaw.com Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 36 of 39 Page ID #:4240 Mailing Information for a Case 2:07-ml-01825-CAS -MAN Electronic Mail Notice List The following are those who are currently on the list to receive e-mail notices for this case. Fletcher C Alford falford@gordonrees.com Stephen R Basser sbasser@barrack.com Steve W Berman steve@hbsslaw.com,heatherw@hbsslaw.com Elaine T Byszewski elaine@hbsslaw.com,JenniferB@hbsslaw.com,sharons@hbsslaw.com Lance A Etcheverry lance.etcheverry@skadden.com Ingrid M Evans ievans@waterskraus.com,jmcintosh@waterskraus.com,rredmayne@waterskraus.com Thomas A Evans tevans@reedsmith.com Denise A Fee daf@jordenusa.com Elizabeth A Fegan beth@hbsslaw.com,Chi_Filings@hbsslaw.com Andrew S Friedman afriedman@bffb.com,rcreech@bffb.com,ngerminaro@bffb.com Laura L Geist lgeist@gordonrees.com,dmckee@gordonrees.com Terence N Hawley thawley@reedsmith.com William Hayden Higgins whiggins@reedsmith.com,dkelley@reedsmith.com Rachel L Jensen CM/ECF - California Central District- 12/30/2010https://ecf.cacd.uscourts.gov/cgi-bin/MailList.pl?470309332164781-L_555... Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 37 of 39 Page ID #:4241 rjensen@rgrdlaw.com,e_file_sd@rgrdlaw.com Steven M Jodlowski sjodlowski@rgrdlaw.com,e_file_sd@rgrdlaw.com James F Jorden jfj@jordenusa.com,lw@jordenusa.com Daniel J Kurowski dank@hbsslaw.com,chi_filings@hbsslaw.com Timothy Mahoney timm@hbsslaw.com,chi_filings@hbsslaw.com Thomas Jerome Nolan tnolan@skadden.com,carl.roth@skadden.com Thomas Joseph O'Reardon , II toreardon@bholaw.com,christinas@csgrr.com Linda B Oliver loliver@reedsmith.com,swurth@reedsmith.com Kimberly C Page kpage@bffb.com Robert D Phillips , Jr rphillips@reedsmith.com Henry Pietrkowski hpietrkowski@reedsmith.com Theodore J Pintar tedp@rgrdlaw.com,e_file_sd@rgrdlaw.com Teresa R Ponder tponder@bergerkahn.com James A Rolfes jrolfes@reedsmith.com Tamara M Rowles trowles@reedsmith.com,aswenson@reedsmith.com Amir Shlesinger ashlesinger@reedsmith.com CM/ECF - California Central District- 12/30/2010https://ecf.cacd.uscourts.gov/cgi-bin/MailList.pl?470309332164781-L_555... Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 38 of 39 Page ID #:4242 Craig S Simon csimon@bergerkahn.com John J Stoia , Jr johns@rgrdlaw.com,e_file_sd@rgrdlaw.com Phong L Tran ptran@rgrdlaw.com Samuel M Ward sward@barrack.com,lxlamb@barrack.com Jeffrey L Williams jlw@jordenusa.com,ksm@jordenusa.com Manual Notice List The following is the list of attorneys who are not on the list to receive e-mail notices for this case (who therefore require manual noticing). You may wish to use your mouse to select and copy this list into your word processing program in order to create notices or labels for these recipients. Michael C McKay Bonnett Fairbourn Friedman and Balint PC 2901 North Central Avenue Suite 1000 Phoenix, AZ 85012 CM/ECF - California Central District- 12/30/2010https://ecf.cacd.uscourts.gov/cgi-bin/MailList.pl?470309332164781-L_555... Case 2:07-ml-01825-CAS -MAN Document 424 Filed 12/30/10 Page 39 of 39 Page ID #:4243