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With $258 million in proposed attorneys fees at stake, Townsend and Townsend and Crew made an eloquent pitch to San Francisco Superior Court Judge Paul Alvarado Tuesday about the value of its work in winning a $1.1 billion antitrust settlement from Microsoft Corp. “There’s no doubt it’s a lot of money,” Townsend partner Daniel Furniss said. “We can justify it because we think we earned it. Pride and prejudice has nothing to do with it.” Judge Alvarado began hearings Monday to determine whether the settlement agreement and requested attorneys fees in the California consumer class action against Microsoft are fair, adequate and reasonable. Alvarado indicated that he might issue separate orders for the settlement and for attorneys fees. “We can leave that to another day how that will be dealt with,” Alvarado said. Furniss said the agreement plaintiffs counsel reached with Microsoft is the second or third largest antitrust recovery in history and that “extra results deserve extra compensation.” Townsend, the lead counsel in the California consumer class action against Microsoft, is requesting about $92 million in attorneys fees and $4.5 million in costs. The remainder of the money is to go to 34 other firms that worked on the case. Under an agreement signed last year, Microsoft is to provide up to $1.1 billion in vouchers to be used for the purchase of any computing products to 14 million Californians who indirectly purchased the company’s software from 1995 to 1997. Furniss argued that “class counsel had done a better job and created more incentive for antitrust compliance than Europe and the United States combined” in its antitrust litigation against Microsoft. The European Union last week fined Microsoft $613 million for violating European competition law. He urged Alvarado to look at both the lodestar — the number of hours expended multiplied by the counsel’s hourly rate — as well as the percent of the award that the attorneys fees comprise. Townsend is seeking a 5.75 multiplier of its lodestar, which would equal about 18 percent of the value of the settlement award. Arguing that the request is in keeping with the market rate for antitrust litigation, Furniss cited a study of 134 class actions from 2000 to 2003. The blended hourly rate in these cases was $349, he said. By comparison, he and his colleagues are seeking a blended rate of $241 per hour. “It would be tragic,” Furniss said, if Townsend lead partner Eugene Crew and his colleagues “received a below-market award” for their efforts. Furniss also praised Alvarado and the court for its work on the case. “You can’t give a multiplier to a Superior Court,” he said. “If one gave a psychic multiplier, this court deserves a large one.” In documents filed with the court last month, Microsoft strongly objected to the proposed attorneys fees, saying they were unprecedented and unwarranted since counsel piggybacked on the U.S. government’s antitrust complaint and other private litigation. Microsoft counsel Robert Rosenfeld, a partner at Heller Ehrman White & McAuliffe, was scheduled to address the fee issue at press time late Tuesday. The hearing is set to resume Thursday.

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