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The 11th U.S. Circuit Court of Appeals has upheld a lower court’s decision to slash White & Case’s legal fee in a bankruptcy-related case from $5.5 million to $1.8 million, criticizing the firm’s fees as excessive. “White & Case has not persuaded us that it is entitled to so much more than the attorneys on the other side of the case,” the three-judge panel stated in its unpublished opinion, which is not supposed to be cited as precedent. White & Case’s lead lawyer on the case, Stephen Corse, a partner in the Miami office, said the firm will not appeal the decision and is relieved the case, which began in 1996, is finally over. “I’m quite pleased with the thought that went into this 48-page ruling,” Corse said. “We are getting nearly $2 million.”But lawyers for the St. Louis-based law firm Thomas Coburn, which had sought to reduce White & Case’s fee, considers the ruling a clear victory. It had argued that White & Case’s fees were six times as high as those of other law firms involved in the case. White & Case made the fee request in 1999 in connection with its representation of 25,000 retirees from the textile manufacturer St. Louis-based Monsanto, which later spun off into the company Solutia, also of St. Louis. Solutia subsequently filed for bankruptcy and sought to alter Monsanto retirees’ benefits. In 1996, the retirees hired White & Case to file suit against their former employer in U.S. District Court in St. Louis. Several other law firms represented union member-retirees. The cases eventually were consolidated in U.S. District Court in Pensacola, Fla. A settlement was reached in 1999. Several lawyers from the New York office of White & Case assisted, but 70 percent of the work was done by Corse and Eric Roth, then an associate in the firm’s Miami office. White & Case took the unusual step of charging the retirees an hourly rate to be taken out of the bankrupt estate, rather than taking a contingency percentage of any settlement. Corse said that was to allow the retirees to receive the entire settlement. All the other law firms reached settlements with Solutia on attorney fees. But White & Case, applying a 2.2 percent multiplier across the board, requested total fees of $5.5 million. White & Case requested fees of $330 to $370 an hour for Corse between 1996 and 1999, and $250 to $300 an hour for Roth for those same years. By contrast, two other law firms that served as counsel for retirees, Aylstock, Witkin & Sasser in Gulf Breeze, Fla., and Levin Papantonio Thomas Mitchell Echsner & Proctor in Pensacola accepted total payments of $45,000, saying they took into consideration the facts of the case as well as the fact that it was litigated in Pensacola. The hourly rates those firms listed were $250 for Fredric G. Levin, $200 for Bryan Aylstock and $90 for Neil Overholtz.Another firm that served as co-counsel for the union member-retirees, Slevin & Hart of Washington, D.C., accepted $600,000 for its work, with hourly rates as low as $70 in 1998 and as high as $240 in 2001. Solutia rejected White & Case’s fee request as excessive. The matter was referred to Magistrate Judge Miles Davis. MARKET RATE? In 2001, White & Case petitioned the U.S District Court in Pensacola to resolve the issue. Davis awarded the firm only $1.8 million in attorney fees. In his ruling, Davis set the hourly rate for White & Case at $260 for partners, $185 for associates and $60 for paralegals. White & Case then appealed to the 11th Circuit. Three lawyers testified as expert witnesses for White & Case in the fee case before Davis, including Stanley Wakshlag, a shareholder at Akerman Senterfitt in Miami. Wakshlag testified that White & Case’s hourly rate request was “in line with the prevailing market rates in this locality.” Solutia’s expert witnesses disagreed, noting that the White & Case lawyers lacked substantial ERISA experience in matters involving the Employee Retirement Income Security Act. In a 48-page, per curiam opinion issued last month, a three-judge panel consisting of Judge Gerald Bard Tjoflat, Judge Ed Carnes and U.S. District Judge Anne C. Conway, who sat in on the case, upheld Davis’ ruling. The court did correct a minor math error in the fee request, however, awarding White & Case an additional $106,000. The panel criticized White & Case for charging more than any of the other firms in the case, including firms with more ERISA experience. “Corse and Roth lacked significant litigation experience in ERISA cases (and it is undisputed that they had virtually no ERISA experience before this case),” according to the opinion. The court also disagreed with White & Case’s assertion that the reason some of the other firms were paid less is because Washington, D.C., firms that represent unions are routinely paid below market value, just like public interest lawyers. “The answer, of course, is that this is not union litigation in Washington, D.C.,” the court responded. In addition, the 11th Circuit disagreed with White & Case’s argument that it was charging the retirees its customary rate. “Basing attorney’s fee awards on customary fees is only a guideline, not a firm rule,” the panel wrote. “In this case,” the court continued, “there was expert testimony, and plenty of it, that the hourly rate should be below the rate that White & Case customarily charges. Not only that, but it was also undisputed that the rate awarded was in line with what other counsel had been paid in this very litigation.” Richard Paulter, a partner at Thompson Coburn in St. Louis, which represented Solutia, said in an interview the aspect of the ruling that most surprised him was that the court decided not to publish it. “If they took the time to write a 48-page opinion, you’d think they’d want to publish it,” he said. Corse, however, said he was not surprised that the 11th Circuit chose to issue it as an unpublished opinion without precedential value. “It doesn’t reflect any changes in the law,” he said. Corse said he was not disappointed with the ruling, noting that the firm has already been paid $1.3 million for 8,000 hours of work and expects an additional $600,000, including the $100,000 from the math error. “We got excellent results for our clients,” he said. “We succeeded in getting secured benefits of $900 million.”

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