As the Justice Department has begun its court fight over legal fees in a high-profile Indian trust account class action in Washington, two House Republicans last week introduced legislation to cap the legal fees in the case at $50 million.
The bill that Rep. Don Young (R-Alaska) and Rep. Doc Hastings (R-Wash.) introduced on March 2 was referred to House Judiciary Committee and to the House Committee on Natural Resources. The Justice Department last month said the plaintiffs’ attorneys should receive no more than $50 million for their involvement in the suit.
Hastings, chairman of the natural resources committee, tried unsuccessfully in November to cap legal fees in Cobell v. Salazar at $50 million. In remarks then, Hastings noted the presiding federal judge has the final say on fees. Under the terms of the settlement, to resolve claims the government mismanaged trust accounts, Cobell’s lawyers agreed to assert between $50 million and $99.9 million in their fee request.
In December, the plaintiffs’ attorneys, including Washington solo Dennis Gingold and a team of Kilpatrick Townsend & Stockton lawyers, said they should receive at least $223 million—an amount based in large part on a 14.75% contingency fee arrangement. Cobell’s lawyers cited the novelty of the case and its duration—the suit was filed in 1996—in their fee petition. The attorneys also said $223 million is on the low end of the percentage scale for lawyers who successfully handle complex class actions.
Hasting’s office last week called the contingency fee arrangement a “secret agreement” that Cobell’s lawyers did not reveal until after Congress passed required legislation approving the $3.4 billion settlement. Hastings’ office said the “exact details” of the arrangement remain unknown—echoing concerns of DOJ lawyers, who said in court papers that the government has not seen a copy of the contingency agreement.
“Let’s be clear: every dollar paid to attorneys is a dollar that comes out of the pocket of individual Indians in this settlement. This handful of lawyers is trying to take an obscene share of the money,” Hastings said in a prepared statement. “This Settlement should be about fair treatment of the 400,000 affected individuals in Indian Country, not lawyers looking to strike it rich.”
Responding to the criticism, Gingold said today that the demand to cap fees at $50 million raises separation of powers concerns, since the settlement has already received preliminary approval and is pending before a federal district judge.
Two members of Congress, Gingold said, are “trying to limit the authority of a United States district judge. There is a substantial separation of powers issue.”
Cobell’s lawyers are expected soon to respond to the Justice Department’s opposition to the fee request. Hogan, the judge, has set a fairness hearing for June.