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1
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MEMORANDUM OF POINTS
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EXTRACTED KEY WORDS
COUNSEL COURT CLASS ACTION COMMISSION COMMON FUND DEFENDANTS SETTLEMENT SUBSTANTIALITY DISTRICT COURT PLAINTIFFS AWARD ATTORNEYS COMPLAINT REIMBURSEMENT LAW VIOLATIONS DISGORGEMENT UNDERLYING LAW VIOLATIONS PETITIONERS SUBSTANTIAL ROLE FEDERAL TRADE PROSECUTION GOVERNMENTAL INVOLVEMENT DIVESTITURE CIVIL PENALTIES UNITED STATES DISTRICT AUTHORITIES RESPONSIBILITY SWEDISH HOSP LITIGATION |
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
________________________________________________)
IN RE: FIRST DATABANK )
ANTITRUST LITIGATION ) MASTER FILE NO.
________________________________________________) 1:01CV00879 (TPJ)
)
THIS DOCUMENT RELATES TO: )
ALL ACTIONS )
________________________________________________)
FEDERAL TRADE COMMISSION'S MEMORANDUM OF POINTS AND
AUTHORITIES IN OPPOSITION TO CLASS PLAINTIFFS' PETITION
FOR AWARD OF COUNSEL FEES AND REIMBURSEMENT OF EXPENSES
The Federal Trade Commission ("Commission" or "FTC") opposes class counsel's
petition for the award of counsel fees (and reimbursement of expenses) in excess of $5 million
based on a common fund of $24 million. Despite having "piggybacked" on the Commission's
investigation and prosecution of defendants' underlying law violations, petitioners virtually
ignore the substantial role played by the Commission in developing the case and, particularly, in
creating the bulk of the common fund. After the Commission concluded its extensive pre-
complaint investigation of The Hearst Corporation, The Hearst Trust, and First DataBank, Inc.
(collectively, "defendants") and filed its complaint, and before any private class action had been
filed, defendants offered the Commission a settlement consisting of $16 million in disgorgement
and $2 million in civil penalties. Petitioners' fee calculation should therefore be based only on
the incremental value provided by class counsel, i.e., on that part of the common fund for which
class counsel were directly responsible in this case, at most an additional $8 million. Viewed
properly, petitioners' application seeks fees representing over 60% of that portion of the common
fund for which class counsel are responsible. Moreover, given the prior "spadework" done by
the Commission, the promptness of the settlement, the failure (and lack of need) to conduct any
formal pre-trial discovery, and various other circumstances, we submit that the appropriate
SNIPPETS:
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