Submission of claims as part of this case, however, would have offered these objectors several distinct benefits. First, the settlement provides the opportunity to file claims in convenient locations across the United States rather than traveling to Mexico. That is a substantial benefit for U.S. resident braceros, as evidenced by the very few of them who traveled to Mexico when claims were last possible during the 2005 Gobernación Claims Program in Mexico.
Second, this Settlement offers U.S. resident braceros from 1942-1946 priority of place in line for payment from funds preserved for them. Settlement § 9.2. The 1942-1946 era eligible claimants will be paid even if the Settlement funds are over-subscribed by 1947-1964 era braceros.
Third, the massive notice campaign in this case, funded by the Mexican government, publicized the availability of reparations payments much more widely than they had ever been publicized before. It seems likely that if these 43 objectors are indeed the surviving spouses or children of braceros (they have provided no probative or competent evidence of that), then either the lack of publicity during the 2005 Gobernación Claims Program in Mexico or the burden of traveling to Mexico prevented their registering or filing claims then, since if they had registered and participated in 2005 they could not participate again now.
Fourth, by invoking legal process this Settlement offers both court oversight and the assistance of class counsel and their staff. That assistance has been substantial. As discussed above, paralegals working on this settlement have provided help more than 12,000 times in response to calls received on the toll-free settlement hotline. Cristancho Decl. ¶ 5.
Further, the provenance of these form letters is suspicious. None of the letters were submitted with any probative or competent evidence that any signer is a member of the plaintiff class in this case (or even a bracero from any era). Curious what was behind these identically worded letters, class counsel attempted to contact the letter signers. Those reached stated that they had been asked to sign the letters by their “leaders” and were not familiar with the letters' contents. Ross Decl. ¶¶ 11-13. Class counsel also mailed a letter to each of these letter signers, offering both to discuss their concerns or questions and to assist them in making a claim for settlement benefits. Piers Suppl. Decl. ¶ 10. Only one of these letter signers responded. Piers Suppl. Decl. ¶ 10; Ross Decl. ¶ 13.
b. Objection of Julie L. Flores and RoseMary Palacio. Ms. Flores and Ms. Palacio have submitted a letter objecting to having to obtain a Mexican passport in order to submit a claim. Doc. #313. They object to the requirement of obtaining documentary evidence of Mexican nationality or citizenship, both logistically and on principle. They also object that the monetary relief is insufficient, stating that “Any other investment would have obviously obtained higher yields over the years.” Doc. #313.
Their objection, on principle, to the specification of a Mexican passport as a part of a proof of claim is unique. No other objection to that point has been received. It is unfortunate but nevertheless not irrational for the Mexican defendants to have made some demonstration of continued allegiance to the Republic of Mexico a condition of payment from funds from the public fisc raised from Mexican taxpayers.
Ms. Flores and Ms. Palacio also have not submitted evidence probative of their membership in the class. They also offer no supporting argument or evidence that the monetary relief provided, while smaller than they would have preferred, is attributable either to an overly pessimistic view on the part of class counsel of the likelihood of a greater recovery through continued litigation or to class counsel's having undervalued or underestimated total damages. In short, they do not state and provide no basis for inferring that class counsel underplayed the hand we were dealt or could in any fashion have successfully bargained for more.
c. Objections of Abel Quiroga, Amelia Garcia, Eusebio Molero. Mr. Quiroga, Ms. Garcia, and Mr. Molero submitted letters to class counsel but not to the court. Their letters have since been filed with the court by class counsel. Doc. #316-318. None of the letters was accompanied by proof that it was written by an actual member of the Class.
These three objections protest the stringency of the documentation requirements - specifically, the requirement of documentation from up to sixty years ago.
As discussed above, in a perfect world, the documentation requirements would have been more flexible, providing a greater number of options for documents that might be submitted and allowing for copies as well as originals. But despite the stringency of the documentation requirements, many thousands of fully-documented claims have been filed and it cannot therefore be said that the requirements render the Settlement outside the broad spectrum of fairness, reasonableness and adequacy. In addition, to the extent these objectors wish to dispense with any documentation requirement, on the suggestion that after sixty years it is unreasonable to expect documents to have been preserved, they ignore that if they had overcome all other procedural and substantive hurdles and reached trial, the standard of proof at trial would almost certainly have required them to present some form of documentation in support of their claims.
d. Objection of Arnulfo Higuera-Gallardo and Jovita González de Naranjo. This objection, signed by two persons, addresses four points: (a) the exclusion of 1947-64 era braceros from the settlement without consultation with them; (b) that settlement payments that are no larger than available under the Gobernación Claims Programs; (c) that the settlement may be a “political ploy” by the Mexican Government; and (d) that settlement payment amounts are insufficient restitution for the 10% of wages that were withheld between 1942 and 1946. Doc. #312.
According to all evidence available to us, 1947-1964 era braceros did not suffer the injury upon which this action is based: there were no savings fund withholdings from their wages as part of the braceros programs they participated in. Accord Cruz v. United States, 219 F. Supp. 2d 1027, 1031 (N.D. Cal. 2002) (“By agreement between the United States and Mexico, all Savings Fund deductions were terminated on January 1, 194”). That is why the Class definition does not include braceros who only began work after December 31, 1946. Nevertheless, and it is not clear that these objectors are aware of it, Mexican Consulates in the U.S. have been accepting claims from 1947-1964 era braceros in the United States because of this Settlement.
As for the sufficiency of monetary relief, this objection ignores both that the essence of settlement is compromise, which results in a discounted recovery, and the distinct risk of zero recovery if this case were to continue to be litigated.
The last point addressed in the objection, that the settlement may be a “political ploy” by the Mexican Government may or may not have truth to it. But many times defendants settle in part for political or public-image reasons and that does not, without more, impugn the fairness, reasonableness or adequacy of the settlement terms.
V. THE PROPOSED, NEGOTIATED FEE IS LIKEWISE FAIR, REASONABLE, AND ADEQUATE. As part of the Settlement, Defendants have agreed to pay attorneys' fees and litigation costs incurred by Plaintiffs' counsel in the prosecution in of this case in the amount of $2,800,000. Agreement § 15. Of that amount, approximately $500,000 will be required to pay litigation expenses advanced by Class Counsel, with the balance of approximately $2,300,000 to be paid as attorney's fees. Class counsel's lodestar in this litigation is more than $4.8 million. Piers Decl. ¶ 42 and Exhibit 2 (Doc. #252-3). Therefore, the requested fees of $2,300,000 equate to payment of less than 50 cents on the dollar as compared to counsel's lodestar calculated at their usual hourly rates for time devoted to this case over almost eight years. The fees are thus a partial payment for class counsel's time. Class counsel will lose substantial money on this case.
Attorney's fees are, “like every other aspect of [class action settlement] agreements, subject to the determination whether the settlement is ‘fundamentally fair, adequate, and reasonable.”’ Staton v. Boeing Co., 327 F.3d 938, 963 (9th Cir. 2003) (quoting Fed. R. Civ. Proc. 23(e)). In making that determination, two primary concerns are implicated, fairness to counsel and incentives for future such litigation. As one court has aptly framed the public policy point:
The contingent fee and the class are “the poor man's keys to the courthouse.” Both vehicles allow the average citizen and taxpayer to have their injuries redressed and their rights protected. Both permit persons of limited resources to obtain competent legal counsel, an essential ingredient in our adversary system of justice.
Muehler v. Land O'Lakes, Inc., 617 F. Supp. 1370, 1375 (D. Minn. 1985).
Class notice clearly disclosed the fees and costs for which class counsel would seek reimbursement. Significantly, no objection received has objected to the requested fees and costs. The fees are justified. This case required immense time and labor. The legal issues involved were novel and difficult. The commitment made by class counsel to this case - more than 9,000 hours of attorney time, more than 5,000 of paralegal time, and more than $466,666,000 in out-of-pocket expenses[FN14] - precluded them from investing time and capital in other cases, many of which would have been significantly less risky and more remunerative.
FN14. Doc. #252-3, 252-4 & 252- 5.
At the same time, the case has provided a resolution to a socially important, longstanding grievance, drawing both attention and respect to braceros and for the first time in almost sixty years causing compensation to be paid to them.
There was no trade-off during negotiations between monetary relief for the class and payment of attorney's fees and costs. The per capita amount payable to each eligible class member was fixed very early in the negotiations, is payable from a Trust and was dictated by the equal amount paid as part of the 2005 Gobernación Claims Program. By contrast, payment or fees and costs were negotiated separately and after relief for the class and will be paid from entirely separate funds, not from the Trust. The funds to be paid for fees and costs would not otherwise have been contributed to the Trust Fund and payment of them does not in any way reduce either what actually will be paid or what could have been paid to class members. Therefore, unlike in many cases, fees and expenses in this case do not reduce a common fund.
1. Plaintiffs' Fee Request Is Reasonable And Much Less Than Their Lodestar. Class counsel took on this very difficult and protracted case on a contingency basis, putting very large amounts of attorney time and capital at risk, obtained a favorable settlement, and are requesting to be paid but a fraction of the value of their services measured at their ordinary market rates. See Baller Decl. ¶¶ 48, 52; Dermody Decl. ¶¶ 33-34; Piers Decl. 41; Lee Decl. ¶ 15.
Subject to Court approval, plaintiffs' counsel will receive payment of their attorney's fees in the amount of $2.3 million, which reflects a steep fifty percent discount as compared to their lodestar, an amount that is well within the range of reasonableness.
A percentage cross-check confirms the reasonableness of the fees. At $2.3 million, the fees amount to approximately 16% of the 150,000,000 pesos guaranteed by the Defendants as available compensation for class members in this case. Agreement § 9.2. This is significantly less than the 25% benchmark established by the Ninth Circuit. Vizcaino v. Microsoft Corp., 290 F.3d 1043, 1047 (9th Cir. 2002) (calling a “25% benchmark rate” a “starting point for analysis” and approving a 28% award); In re Pac. Enter .Sec. Litig., 47 F.3d 373, 379 (9th Cir. 1995) (noting that the benchmark is 25% and affirming a 33% fee award).
Significantly, by contrast with other cases in which a cross-check is used, the fees in this case will not reduce the size of the common fund available to the class. These fees would be well within the range of reasonable if they did reduce amounts available to the class but here they do not. Vizcaino v. Microsoft Corp., 290 F.3d at 1047. A fortiori, they are reasonable in this situation.
The requested fee is also fair and reasonable in view of the amount and quality of the work performed by Class Counsel.
VI. THE COSTS ACTUALLY INCURRED FOR WHICH CLASS COUNSEL SEEK REIMBURSEMENT ARE REASONABLE. Through September 2008, class counsel invested approximately half a million dollars in costs in this case, without any guarantee they would ultimately be recovered. See Baller Decl. ¶ 49 (Doc. #252-4); Piers Decl. ¶ 41 (Doc. #252-3).
All costs incurred here were necessary to the prosecution of the case, would normally have been billed to a client paying for counsel's services on a regular basis, and are quite reasonable in view of the complexity and duration of this case. Class counsel therefore request that these costs be compensated in full.
CONCLUSION For all the foregoing reasons, plaintiffs respectfully request that this Court grant final approval to and enter final judgment in accordance with the terms of the parties' Settlement Agreement.
Dated: January 22, 2009
/s/ Joshua Karsh One of the Attorneys for Plaintiffs and the Class
Matthew J. Piers (admitted pro hac vice)
Joshua Karsh (admitted pro hac vice)
HUGHES SOCOL PIERS RESNICK & DYM, LTD.
Three First National Plaza
70 West Madison Street, Suite 4000
Chicago, IL 60602
(312) 580-1994 (fax)
Elizabeth J. Cabraser (CA Bar No. 83151)
Kelly Dermody (CA Bar No. 171716)
Jahan Sagafi (CA Bar No. 224887)
Daniel Hutchinson (CA Bar No. 239458)
LIEFF, CABRASER, HEIMANN & BERNSTEIN, LLP
Embarcadero Center West
275 Battery Street, 30th Floor
San Francisco, CA 94111-3399
(415) 956-1008 (fax)
Morris J. Baller (CA Bar No. 48928)
Laura L. Ho (CA Bar No. 173179)
Joseph Jaramillo (CA Bar No. 178566)
GOLDSTEIN, DEMCHAK, BALLER, BORGEN & DARDARIAN
300 Lakeside Drive, Suite 1000
Oakland, CA 94612
(510) 835-1417 (fax)
Bill Lann Lee (CA Bar No. 108452)
LEWIS FEINBERG LEE RENAKER & JACKSON PC
1330 Broadway #1800
Oakland, CA, 94612-2519
(510) 839-7839 (fax)
Attorneys for Plaintiffs and the Class Senorino Ramirez CRUZ; Leocadio de la Rosa; Liborio Santiago Perez; Felipe Nava; Ignacio Macias; and Rafael Nava on behalf of themselves and all others similarly situated, Plaintiffs, v. UNITED STATES OF AMERICA; Estados Unidos Mexicanos; Wells Fargo Bank; Banco de Mexico; Banco Nacional de Credito Rural, S.N.C., as successor in interest to the Banco de Credito Agricola, S.A.; and Patronato del Ahorro Nacional, as successor in interest to the Banco del