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Two prominent U.S. plaintiffs’ law firms, Susman Godfrey and Hausfeld, have petitioned a Manhattan federal judge for $25.2 million in legal fees related to their recent settlement in a high-stakes antitrust litigation case against major banks. The ongoing litigation has already yielded settlements worth a staggering $781 million. This request for legal fees marks a significant development in the case.
Law Firms Seek Compensation in Antitrust Litigation
Susman Godfrey and Hausfeld, renowned for their legal prowess, submitted their fee request to U.S. District Judge Naomi Reice Buchwald, who presides over the complex claims in Manhattan federal court. These claims revolve around allegations that a group of banks conspired to manipulate the Libor benchmark interest rate, a practice alleged to have occurred during the financial crisis.
Cumulative Legal Fees Exceed $100 Million
The proposed fee award, if granted, would contribute to the remarkable sum of over $100 million in legal fees earned by the two law firms thus far. This notable figure underscores the magnitude and significance of the case.
Representation of OTC Investors in Libor Litigation
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Susman Godfrey and Hausfeld undertook the representation of a class of “over the counter” (OTC) investors who engaged directly with the bank defendants in the Libor litigation. This protracted legal battle began in 2011 and has seen various settlements.
Recent Settlement Involving Major Banks
In the most recent settlement, the sixth in a series of negotiations, several financial institutions, including Dutch cooperative bank Rabobank and Lloyds Banking Group, agreed to pay a combined sum of $101 million to resolve claims against them. This settlement further advances the interests of the OTC investors represented by the law firms.
Request for a Percentage of the Settlement
The law firms have requested an amount equal to 25% of the recently secured settlement. Notably, they have indicated their intention to seek up to 30% of future settlements as the litigation progresses. This highlights the confidence they have in their case.
Banks’ Response and Disputed Claims
Representatives from Rabobank and Lloyds have not yet issued statements in response to the request for legal fees. It’s important to note that the banks had consistently disputed the plaintiffs’ claims and denied any liability in the matter.
Allegations Regarding the Libor Benchmark Rate
The heart of this litigation revolves around the Libor benchmark interest rate, commonly known as the London Interbank Offered Rate. This rate serves as a reference point for establishing interest rates on various financial products, including mortgages, credit cards, and student loans. The plaintiffs allege that the defendant banks artificially manipulated this rate, resulting in reduced payments to individuals and institutions within the class.
Previous Settlements Involving Major Banks
Apart from Rabobank and Lloyds, other central banks, such as Deutsche Bank and Citibank, have previously reached settlements in the ongoing litigation. Deutsche Bank agreed to pay $240 million in a prior settlement, while Citibank committed to a settlement of $130 million.
Extensive Legal Efforts
In their fee filing, the class attorneys disclosed that they had invested 124,422 hours in this complex litigation up to July. This commitment underscores the significant resources and dedication required to prosecute such high-stakes cases.
Hourly Billing Rates of Attorneys
The fee filing also revealed the hourly billing rates of the attorneys involved. William Carmody, who leads Susman Godfrey’s New York office and is a member of the firm’s executive committee, charges $2,200 per hour for his legal services. Michael Hausfeld’s rate was $1,550 per hour, reflecting the caliber of legal expertise involved in the case.
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