Free Response - District Court of Arizona - Arizona

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RYLEY CARLOCK & APPLEWHITE One North Central Avenue, Suite 1200 Phoenix, Arizona 85004-4417 Telephone: 602/258-7701 Telecopier: 602/257-9582 Charles L. Chester ­ 002571 [email protected] John M. Fry - 020455 [email protected] Attorneys for Defendant UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA KAYE E. HUTTON, as an individual and as representative of a class consisting of others similarly situated, Plaintiff, v. BANK OF AMERICA, N.A., Defendant. I. INTRODUCTION On July 25, 2007, the Court ordered Collective counsel to submit a memorandum explaining why the fees requested should be awarded by the Court. The Court also ordered Defendant's counsel to respond to the memorandum. Response, Defendant's counsel complies with the Court's order. Collective counsel have explained why they believe the fees sought are justified. In doing so, they characterize several events and achievements in a manner with which Defendant's counsel disagrees. Without belaboring these points, suffice it to say that the Bank never violated any rights of any Opt-in or Ms. Hutton. Rather, it proceeded in good faith and lawfully, but fully aware of the vagaries of proof and resultant risks in state and federal court jury trials, especially before clear articulation of controlling law in and after August, 2004.
843860.1 Case 2:03-cv-02262-ROS 9/12/2007

No. CV2003-2262-PHX-ROS BANK OF AMERICA'S RESPONSE TO MEMORANDUM IN SUPPORT OF ATTORNEYS' FEES FOR COLLECTIVE COUNSEL

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II.

THE BANK'S POSITION The Bank does not oppose Collective counsels' fee applications. If the Court determines that the application is excessive, the Bank requests

that the Court invite counsel to agree to modify Section II(E) of the Settlement Agreement (a) to allocate the excess fees to the Opt-ins, pro rata (Ms. Hutton already has received a very substantial incentive award), and (b) to award Collective counsel fees determined to be fair and reasonable. Finally, the Bank requests that the Court grant final approval of the Settlement Agreement, including any modifications proposed to and accepted by counsel. III. DEFENDANT'S COUNSEL'S POSITION It is respectfully submitted that in the best case scenario for it, the Collective to which the Settlement Agreement is applicable could have recovered no more than approximately $3,200,000.00, plus reasonable fees and costs (the Collective claims could have resulted in no recovery). The Court has observed that fees generally would be in the range of 25%, or $800,000.00, on such an award. Costs claimed are $135,000.00. Therefore, the total recovery, assuming complete success today would be $4,135,000.00. The $2,500,000.00 Settlement Agreement negotiated is 60% of this sum, which is very reasonable under all the circumstances. The Court so declared at the July 25, 2007, hearing, and rightly so. No one questions that conclusion. The Collective members, all highly sophisticated financial advisors, agreed to pay a 1/3 fee from the gross settlement, exclusive of costs, in the event of settlement. Holding them to their commitment is fair and reasonable. So, fees of $832,500, exclusive of costs, are viewed as fair and reasonable by the Collective. That sum compares favorably with the fees the Court observed were generally acceptable. Collective counsel request fees of $1,032,000.00. Therefore, the only sum which may be at issue is the remaining approximately $200,000.00. The Bank settled
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understanding this sum would be necessary to achieve settlement, payable as part of what the parties called a "lodestar." It does not oppose the payment. As Collective counsel has noted (in Section I.E. of their Memorandum), lodestar payments are not uncommon, or per se unreasonable. No Collective member (again, all are or were sophisticated financial advisors) has opposed the payment. So, of those directly

involved, no one objects to the additional $200,000.00 being paid to Collective counsel. For the foregoing reasons, Defendant's counsel does not oppose the fee request. Since none of the parties involved oppose the fee request, it can be considered fair and reasonable in this action, an action which will see its fourth anniversary next month. DATED: September 12, 2007. RYLEY CARLOCK & APPLEWHITE By /s/Charles L. Chester ____________ Charles L. Chester John M. Fry One North Central Avenue, Suite 1200 Phoenix, Arizona 85004-4417 Attorneys for Bank of America, N.A.

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I hereby certify that on September 12, 2007, I electronically transmitted the attached Bank of America's Response to Memorandum in Support of Attorneys' Fees for Collective Counsel to the clerk's office using the CM/ECF system for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Michael J. O'Connor Jennings, Strouss & Salmon, P.L.C. The Collier Center, 11th Floor 201 E. Washington Street Phoenix, AZ 85004 Lydia A. Jones ROGERS & THEOBALD, LLP 2425 East Camelback Road Phoenix, AZ 85016

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/s/ Janel Golec

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