International BigLaw firm, Quinn Emanuel Urquhart & Sullivan, made a motion seeking $185 million for representing insurers suing the federal government for compensation under the Affordable Care Act ("ACA").
The fee is 5% of the $3.7 billion judgment Plaintiffs will be awarded after a class action alleging running unprofitable health plans under the health care law. The controversy is the judgment the amount translates to a whopping hourly fee of about $18,500 for the firm.
“If approved, a 5% fee would represent one of the lowest percentage rates ever awarded to class counsel, even in cases with multibillion-dollar recoveries, such as this,” the motion said.
Translated into an hourly fee, the judgment equates to a bonus of 18-19x times the law firm’s normal billable hourly rate. The firm alleged the amount is "reasonable" under a lodestar cross-check that involves calculating the product of lawyers’ hourly rate with the number of hours worked, then applying a risk multiplier to compensate for the risk of no or reduced recovery.
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