Where objections lodged by persons to a preliminary class settlement resulted in changes to the settlement agreement that materially increased the benefits to class members, the objectors were each awarded $7,500, along with their attorney’s fees.
Plaintiffs filed a putative class action complaint against Genworth Life Insurance Company and Genworth Life Insurance Company of New York, alleging that defendants failed to disclose material information to policyholders of long-term care policies, to their detriment.
The parties reached a settlement which the court preliminary approved. Certain persons then objected to aspects of the proposed settlement, resulting in three changes to the special election options in the amended settlement agreement. Now before the court are motions for incentive fee awards and their attorney’s fees filed by three of the objectors.
Counsel for Belkin is asking for $195,000 in attorney’s fees. Counsel argues that their negotiations with plaintiffs and defendants led to the addition of two special election options, which allows class members to retain a portion of their lifetime benefits, including the inflation protection benefit.
There are four individuals included in this fee: James Thorsen (lead counsel), Jeffrey Belkin (lead counsel), Jesse Roche (assistant counsel) and Kim Maiden (a paralegal and legal assistant). Thorsen worked a total of 33.10 hours at an hourly rate of $600; Belkin worked a total of 42.25 hours at an hourly rate of $500; Roche worked a total of 26.70 hours at an hourly rate of $400; and Maiden worked a total of 4.50 hours at a rate of $150. Counsel argues these hourly rates are reasonable based on the prevailing market rate in the Eastern District of Virginia Richmond Division.
Additionally, counsel appears to have “made a good faith effort to exclude excessive, redundant, or otherwise unnecessary hours” and that the included hours were “a necessary use of time and resources in prosecuting this case and bringing out a modification to the Settlement Agreement that provides substantial relief to the class.”
While the actual amount paid to class members is unknown at this time, counsel for Belkin calculates that the addition of the special election options they negotiated will add at least $5,424,000 to the value of the settlement. Nothing in the record suggests otherwise. Additionally, the inclusion of an option that allows class members to retain their inflation protection benefits is undoubtedly valuable.
As of Dec. 12, 2022, no objections have been raised challenging the award of attorney’s fees to counsel for the settlement objectors. Additionally, both class counsel and Genworth agreed not to oppose the request for attorney’s fees. The following factors also weigh in favor of the motion: the skill and efficiency of the attorneys involved, recovery was not certain, public policy, the time devoted to the litigation and the fee awards in similar cases. Based on the factor analysis and the percentage-of-fund cross-check, the court finds that the request for $195,000 for attorney’s fee is reasonable.
Counsel for the Podell/Friedman objectors are requesting $384,690 in attorney’s fees because, in their view, negotiations with counsel for plaintiffs and defendants led to two substantial changes to the special election options, including an $150 increase in cash damages for the non-forfeiture option and the expansion of one of the options, which are said to add over $6 million of value to the settlement.
The court finds that the following factors favor this motion: the results obtained and amount involved, the lack of objectors, the skill and efficiency of the involved attorneys, that recovery was not certain, public policy, the time devoted to the litigation and the fees in similar cases. Based on the factor analysis and the lodestar cross-check, the request for $384,690 for attorney’s fee is reasonable.
The work done by each of the settlement objectors was in pursuit of their aim of improving the terms of the settlement. Additionally, under the terms of the objectors’ settlement agreement, the payment of these service awards will not detract from the value of the relief. Each of the represented objectors is awarded $7,500.
Settlement objectors’ motions for service awards and attorney’s fees granted.
Haney v. Genworth Life Insurance Co., Case No. 3:22-cv-55, Jan. 12, 2023. EDVA at Richmond (Payne). VLW 023-3-022. 25 pp.