## Facts

- Recipients of the Björk–Shiley convexo/concave mechanical heart valve and related persons brought a products-liability class action against the valve manufacturer (Shiley, Inc.) and its parent (Pfizer, Inc.), alleging design and manufacturing defects associated with strut fractures.
- In 1992, the parties obtained approval of a worldwide class settlement creating multiple settlement funds, including benefits for non-fracture recipients, medical consultation services, research-related components, and compensation mechanisms for future fracture events.
- After settlement approval, certain attorneys who had represented objectors were appointed as Special Counsel to assist class counsel with settlement implementation and ongoing administration.
- Class counsel and Special Counsel submitted applications seeking attorneys’ fees and expenses payable from the settlement’s common funds, including a request reported as approximately $33 million in fees.
- The original judge recused from the fee phase, and a visiting district judge was assigned to determine reasonable fees and expenses to be paid from the settlement funds.

## Issues

1. Whether the requested attorneys’ fees from the settlement’s common funds were reasonable given the actual value of the class benefits obtained and the factors governing common-fund awards.
2. How the settlement’s common fund should be valued for a percentage-of-the-fund fee calculation where some benefits were contingent or payable over time.
3. Whether the claimed litigation and administration expenses were adequately documented and reasonably chargeable to the class.
4. How to structure compensation to account for both work already performed and continuing services required to administer the settlement.

## Decision

- The court awarded $10.25 million in total attorneys’ fees to Class Counsel and Special Counsel, substantially reducing the fee request.
- The court awarded $476,938.06 in expenses and reduced or denied other expense requests that were insufficiently justified or documented.
- The court applied a percentage-of-the-fund framework tied to a realistic valuation of the settlement benefits, with a reasonableness cross-check against the value of services on an hourly basis.
- The court structured the award to reflect ongoing obligations in settlement administration and to avoid an excessive front-loaded payment unrelated to realized class benefits.

## Legal Principles

- In a common-fund settlement, attorneys’ fees must be reasonable in relation to the actual benefit conferred on the class, not an inflated or speculative valuation of contingent or deferred components.
- A percentage-of-the-fund method is an accepted approach for common-fund fees, commonly tested by a lodestar-style reasonableness cross-check.
- Fee reasonableness may consider the value of the benefit to the class, litigation complexity and duration, contingency risk, counsel’s skill and standing, and the relationship between requested fees and hours reasonably expended.
- Claimed expenses charged to the class must be reasonably necessary and adequately documented; unsupported or weakly supported items may be reduced or denied.
- Where settlement administration requires continuing legal services, the timing and structure of fee payments may be designed to correspond to realized fund payments and future work.

## Conclusion

The court treated the fee phase as a common-fund reasonableness inquiry, valued the settlement based on realizable benefits rather than contingent or deferred amounts, reduced the requested fees to $10.25 million, and limited expenses to documented, class-related costs while accounting for counsel’s continuing settlement-administration duties.


Bowling v. Pfizer, Inc., 922 F. Supp. 1261 (S.D. Ohio 1996)