In re Auction Houses Antitrust Litig.

197 F.R.D. 71 (S.D.N.Y. 2000)

 

RULE:

Lead counsel typically is responsible for working with other counsel to develop positions on substantive and procedural issues in the case, presenting arguments to the court, initiating discovery requests and responses, employing expert witnesses, conducting depositions and insuring that schedules are met.

FACTS:

In a class action against two primary auction houses arising from alleged price fixing, where the plaintiffs alleged conspiracy to manipulate the prices at which they provided non-Internet auction services, the court conducted an auction to select lead counsel for plaintiffs.

ISSUE:

Can the court create a mechanism to select lead counsel in a class action?

ANSWER:

Yes

CONCLUSION:

The court undertook to establish a method of counsel selection and a fee structure that, in the context of the case, would align attorney-client interests more closely, reduce agency costs, and help ensure that the class action mechanism acted as an effective mechanism of justice. The court sought to act as a fiduciary to the class in selecting counsel. In the final bid selection process, bidders submitted their qualifications, an evaluation of risks and rewards, the basis for their bid, and stated the value of X in the following fee structure: 100 percent of the gross recovery up to and including X to go to the class, 25 percent of any recovery in excess of X to go to counsel inclusive of expenses with the remainder to the class. Bidders were prohibited from revealing their bids to others bidders. The winning bid was not to be revealed to defendants until the adjudication was final.

Click here to view the full text case and earn your Daily Research Points.