In Laffitte v. Robert Half International Inc.,  2014 DJDAR 15575, the California Court of Appeal for the Second Appellate District decided an interesting attorney fee case arising from class action wage and hour litigation.

In 2001, a class plaintiff filed a wage and hour class action against Robert Half International Inc. (“Robert Half”) and related entities. After a number of years of intense litigation, all parties agreed to settle the case. Pursuant to the terms of the settlement, Robert Half agreed to pay a gross settlement amount of $19,000,000. The agreement further provided that class counsel would seek approval of not more than $6,333,333.33, or 33.33 percent of the $19,000,000 settlement.

Thereafter, the class representatives filed a motion for attorney fees, requesting $6,333,333.33 in fees for class counsel. One class member filed an objection to the application. The objector argued that the notice to the class members denied due process because the nature and timing of the settlement approval was unfair.

The objector also argued that, in reviewing the class counsel’s request for attorney fees, the trial court erred by using the “percentage of fund method” and that there were irregularities and mistakes in the court’s lodestar calculation.

The objector cited federal authorities in support of the objection. The objector argued that requiring class members to file objections to the proposed settlement and request for attorney fees before class counsel filed their motion for attorney fees was a violation of due process. In support of this argument, the objector relied on FRCP 23 (rule 23) and 54 (rule 54) (28 U.S.C.), and the Ninth Circuit’s opinion in In re Mercury Interactive Corp. Securities Litigation (9th Cir. 2010) 618 F.3d 988, 993‑995.

In deciding the issue, the second appellate district stated that FRCP 23 and related federal case law does not control in California. The court stated that:

As a general rule, California courts are not bound by the federal rules of procedure but may look to them and to the federal cases interpreting them for guidance or where California precedent is lacking.”

The court of appeal stated that under the “common fund” doctrine, the goal is to compensate counsel for their efforts, regardless of the method of calculation. Thus, the “percentage‑of‑the‑benefit” analysis or the lodestar method for determining attorney fees is appropriate so long as the chosen method is applied consistently and accurately reflects the type of legal work performed in the relevant community.