In Re Washington Public Power Supply System Securities Litigation

ORDER — ATTORNEYS’ FEES AND EXPENSES

WILLIAM D. BROWNING, Chief Judge.

This Order addresses the petitions of plaintiffs’ counsel for attorneys’ fees and expenses in this action. Initial fee petitions were filed in early 1989 prior to hearings held on April 11 and 12, 1989, in the United States District Court in Seattle, Washington, concerning the fairness, reasonableness and adequacy of settlements reached in this massive multi-district securities litigation.

See Notice of Settlements and Settlement Hearings and Class Certification

at 12, February 6, 1989. On September 5, 1989, in an opinion that recounted the history of this litigation, the Court approved the settlements that were the subject of the April 1989 hearings.

1

In re Washington Public Power Supply System Secur. Litigation,

720 F.Supp. 1379 (D.Ariz.1989). The Court reserved jurisdiction over the attorneys’ fee petitions and over matters concerning the allocation and distribution of settlement proceeds among various claimants to the settlement funds. On July 24, 1990, after notice to all Class members and known bondholders, and after extensive briefing, a hearing was held in New York City concerning the allocation of settlement proceeds among claimants to the fund, other than these petitioning attorneys. The Court’s decision regarding the allocation of settlement proceeds among

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and between Class members and Chemical Bank on behalf of the Bond Fund was rendered the following month.

2

(Order dated August 15, 1990.)

CONTENTS

THE FEE AND EXPENSE PETITIONS 1078

The Petitioners 1079

Class Counsels’ Petition 1080

AMBAC Petition 1082

The Haberman Petitions 1082

LEGAL STANDARDS 1082

METHODS OF FEE DETERMINATION 1084

Percentage-Based Fee Awards 1084

Blended Lodestar Analysis 1087

Fee Enhancements — The Use of Multipliers 1088

DETERMINATION OF THE LODESTAR 1091

General Comments Regarding the Fee Petitions 1092

Class Counsels’ Fee Petition 1092

Haberman and AMBAC Petitions 1094

GUIDELINES USED IN REVIEWING THE PETITIONS 1094

The Time and Labor Required 1094

Paralegal Time and Labor 1097

The Novelty and Difficulty of the Questions 1097

The Results Obtained and Amount Involved 1097

The Rates Charged 1099

Paralegal Rates 1100

The Nature of the Fee 1101

The Desirability or Undesirability of the Case 1101

Preclusion of Other Employment 1101

The Nature and Length of the Professional Relations with the Client 1102

Time Limitations Imposed 1102

Awards in Similar Cases 1102

EXPENSE REIMBURSEMENT REQUESTS 1102

LODESTAR FEE AND EXPENSE AWARDS 1103

Bernstein Litowitz Berger & Grossmann 1103

Milberg Weiss Bershad Specthrie & Lerach 1112

Shidler McBroom Gates & Lucas 1128

Barrack, Rodos

&

Bacine 1135

Berger & Montague, P.C. 1140

David B. Gold, P.C. 1145

Goodkind, Labaton & Rudoff 1149

Graham & Dunn 1155

Harvey Greenfield 1159

Hallisey & Johnson 1162

Kaufman Malchman Kaufmann & Kirby 1164

Meredith & Cohen, P.C. 1166

Molloy, Jones & Donahue, P.C. 1168

Much Shelist Freed Denenberg Ament & Eiger, P.C. 1171

Allan Peckel and Rabin

&

Silverman 1174

Pomerantz Levy Haudek Block & Grossman 1176

Sachnoff Weaver & Rubenstein, Ltd. 1180

Saveri and Saveri 1185

Schoengold & Sporn, P.C. 1187

Stull, Stull & Brody 1191

Wolf, Block, Schorr & Solis-Cohen 1193

Wolf Haldenstein Adler Freeman & Herz 1196

Wolf Popper Ross Wolf & Jones 1201

Zwerling, Schachter & Zwerling and Prince, Kelley, Newsham & Marshall, P.S. 1206 WPPSS Litigation Fund 1209

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SUMMARY OF CLASS COUNSEL AWARDS 1211

Attorney Lodestar Summary 1211

Paralegal Lodestar Summary 1212

Expense Reimbursement Summary 1213

CHEMICAL BANK EXPENSES 1213

AMBAC INDEMNITY CORPORATION COUNSEL (FOLEY & LARDNER) 1220

HABERMAN COUNSEL 1223

Winthrop Stimson Putnam & Roberts 1225

Smith Smart Hancock Tabler & Middlebrooks 1228

GORDON THOMAS HONEYWELL 1228

AWARDS 1228

INTEREST 1229

ORDER 1229

FINAL JUDGMENT 1230

THE FEE AND EXPENSE PETITIONS

The initial fee petitions, filed in connection with the April 1989 hearings, encompass counsels’ request for payment for work performed from the inception of this litigation through early 1989. A number of petitioning firms have since submitted supplemental reports for work done after the period covered by their initial petitions. The Court advised counsel that the amounts of fees and expenses reported in those supplemental reports, for work performed through December 31, 1989, would also be deemed petitioned for unless counsel objected promptly. (Minute Order, April 2, 1990.)

On June 5,1990, Class counsel moved for relief from the April 2,1990, Minute Order. The Court has considered Counsel’s belated arguments and will not grant the relief requested. The Court has reviewed the nature of the work reported in the supplemental petitions and has determined, however, that an award for some of the work reported therein should not be considered, nor made, at this time. I will therefore defer consideration of certain undertakings until such time as a supplemental fee petition is filed. Deferral has been made, in particular, for work that clearly involved efforts related to on-going insurance litigation, as opposed to work more directly stemming from the settlement of MDL 551, or from the fee petitions that are the subject of this Order. The work of each attorney for which consideration has been deferred is indicated herein.

With the exception of some post-petition work that has been deferred for the Court’s future consideration, therefore, today’s Order contemplates the aggregate of the amounts reported in both the initial petitions and in supplemental reports.

3

The period of time encompassed by this Order, thus, extends from pre-1983 through December 1989 — more than seven years.

It is understatement to say that this fee petition is, like the litigation itself, massive. The total amount sought at this time out of the settlement proceeds is slightly in excess of $162,327,340.

4

Of that amount, ap

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proximately $54 million represents expenses amassed in connection with the litigation. The remaining $108 million request is for attorneys’ and paralegal fees. The petitions reflect a total of nearly 205,-000 hours of work performed by more than 340 different attorneys and approximately 250 paralegal employees. Described differently, the reported hourly figure converts to roughly one hundred working man-years.

During the past months, the Court has methodically and painstakingly scrutinized the voluminous materials submitted by the petitioning firms in support of their reported fees and expenses. Numerous requests for explanatory information were made, and several Orders were issued requiring additional data. Various memoranda, declarations and affidavits submitted in support of and in opposition to the fee petitions have been studied. Relevant caselaw has been exhaustively analyzed.

The amounts awarded herein will undoubtedly be viewed as both too generous and too restrictive by Class members, attorneys, objectors and others. My determinations reflect a tremendous amount of work, attention to detail and concern for fairness to all parties. As is to be expected, difficult and demanding decisions were required. Many decisions were subjective and not capable of calculation. They were not, however, arbitrary.

I am keenly aware of the exceptional ability and industry of counsel in this case. Class Plaintiffs’ Lead counsel commanded the respect of the Court and all others. It should be beyond cavil that there is no imputation or implication of dishonesty or overreaching in connection with these fee applications. The question of supportability has been the overriding consideration throughout. In cases such as these, years intervene between the fee generating event and its review by the court. Memories fade, so it is impossible to re-create accurately the exact nature of services rendered if they are not adequately described at or near the time performed. There is also a lack of periodic review of services and charges that normally marks the attorney-client relationship and the attendant lack of ability of the client to question charges when events are fresh. Likewise, the attorney lacks the opportunity to justify charges when specific events are fresh in his or her own mind.

If there is a message in the Court's treatment of the fees requested, it is that the requests were inadequately documented. Future common fund applicants should note that the awarding court will necessarily require comprehensive documentation of time spent on specific tasks in order to discharge its fiduciary duty to Class members. The court must apply scrutiny such that its decisions will be presented to Class members, counsel and any reviewing court as a reasoned and objective analysis and resolution.

The Petitioners

Thirty-two different law firms have applied for reimbursement of fees and/or expenses. Twenty-five of these firms participated, to one degree or another, as counsel for the Class Plaintiffs in this litigation. Initially, these firms submitted a joint petition for fees and expenses. These twenty-five firms will be referred to herein as “Class counsel.”

Included with the petition of Class counsel is a request for reimbursement of expenditures made by the “WPPSS Litigation Fund” (“Litigation Fund” or “Fund”). This Fund was established and operated by Class counsel early in the litigation. It was managed by an attorney from one of the petitioning Class counsel firms. The Fund was established by means of monetary assessments of twenty-three of the firms that have filed a joint petition for fees. Litigation Fund expenditures were of two primary types: (1) reimbursement to Class counsel for litigation expenses reported to the Fund, and (2) payment of other litigation expenses.

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One other petition for reimbursement of expenses is before the Court. An application for more than $51 million was filed by Class counsel on behalf of Chemical Bank, the Bond Fund Trustee. The requested amount represents reimbursement sought, in large part, for expenses paid by Chemical in connection with the establishment and operation of a Data Center in Seattle, Washington, and a Trial Support Service facility in Tucson, Arizona, pursuant to an agreement between Chemical and Class counsel. This agreement, and the operations and expenditures it concerned, are discussed more fully herein in the section entitled “Chemical Bank Expenses.”

An additional petition was submitted for payment for work done on behalf of AM-BAC Indemnity Corporation (formerly MGIC Indemnity Corporation), one of the Class members in the MDL 551 litigation. These petitioners will be referred to as “AMBAC counsel.”

Another six law firms have submitted petitions for work done primarily in connection with litigation that was undertaken in the state courts of Washington and reported under the caption

Haberman v. Washington Public Power Supply System,

109 Wash.2d 107 , 744 P.2d 1032 (1987),

mod. Haberman v. Washington Public Power Supply System,

750 P.2d 254 (Wash.1988),

app. dismd. American Express Travel Related Services Co. v. Washington Public Power Supply System,

488 U.S. 805 , 109 S.Ct. 35 , 102 L.Ed.2d 15 (1988). These firms represented various plaintiffs, some of whom were Class members in MDL 551, in the state court litigation.

Class Counsels’ Petition

Class counsel submitted several documents in connection with their fee application. The “Declaration of Lead Counsel in Support of the Proposed Settlements and Class counsel’s Joint Application for Fees and Reimbursement of Expenses” was submitted by Lead Counsel in the litigation: Paul M. Bernstein, of the law firm of Bernstein Litowitz Berger & Grossman; Melvyn I. Weiss, of Milberg Weiss Bershad Spec-thrie & Lerach; and James R. Irwin, of Shidler McBroom Gates & Lucas. This Declaration was submitted in support of the Court’s approval of both the proposed settlements and of the joint application of Class counsel for an award of fees and reimbursement of expenses.

Accompanying the Declaration of Lead Counsel were twenty-five separate “Declarations of Each Plaintiffs’ Class Counsel Re Lodestar and Expenses.” The declarations contain information regarding the hours, rates and expenses of each law firm, and the WPPSS Litigation Fund, that requested reimbursement in the initial petition.

A third document, “Memorandum of Points and Authorities in Support of Application for Award of Fees and Reimbursement of Expenses of Class Plaintiffs’ Counsel,” accompanied by the “Declaration of Melvyn I. Weiss in Support of Memorandum of Points and Authorities in Support of Application for Award of Fees and Reimbursement of Expenses of Class Plaintiffs’ Counsel” was also submitted with Class counsels’ initial petition. Additionally, in February, 1989, Class Plaintiffs Counsel submitted “Class Plaintiffs’ Memorandum Regarding the Legal Standards Governing the Award of Attorney’s Fees” to the Court. That memorandum has today been made part of the record. Together, the documents described above comprise Class counsels’ petition.

To supplement and support its petition, every firm was required to submit copies of the contemporaneous records reflecting the amount of time and the nature of each activity undertaken by each individual petitioning attorney and paralegal for which payment is sought. Furthermore, throughout the course of the litigation, beginning in the fall of 1984, all firms that anticipated the possibility of applying to the Court for an award of attorneys’ fees were required to provide the Court with a bi-monthly report indicating the billing rate and number of hours worked on the litigation for every attorney or paralegal in the firm (“Lodestar Reports”). In October, 1989, counsel were ordered to continue to submit similar reports, on a quarterly basis, for work done

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subsequent to the initial petition. Those reports, for work reported through December 31, 1989, have been deemed by the Court, and are referred to herein, as “supplemental petitions.” All of these documents have today been sealed and made part of the record of this litigation. They are not be opened except under Order of this Court. Many of the records, particularly those that meet the criteria of proper fee applications, contain accounts of petitioning attorneys’ undertakings that are, arguably, work product. The Court has been careful, in this Order, not to divulge sensitive information. It will not expose counsels’ methods and tactics, suggested and revealed within those records, unnecessarily.

At the time of the initial application, Class counsels’ petition was supported by a reported lodestar of $33,271,203.

5

Class counsel requested a fee award of $102,992,-564, noting that the amount was approximately 3.1 times the reported lodestar.

Counsel proposed that the award be distributed among the twenty-five Class counsel firms in a manner reflecting lead counsel’s appraisal of a number of factors relevant to each petitioning firm's contribution to the litigation. The following table shows the amount that lead counsel proposed to distribute to each firm. Following each firm’s proposed share is the multiplier by which the firm’s reported lodestar amount was increased to arrive at the firm’s proposed share.

Firm Fee Requested

Bernstein Litowitz Berger & Crossman $ 26,796,240 I —

Milberg Weiss Bershad Specthrie & Lerach 31,702,554 I —

Shidler McBroom Gates & Lucas 15,450,697 I —

Molloy, Jones & Donahue 968,073 I —

Graham & Dunn 2,625,005 I —

David B. Gold 3,271,912 I —

& Montague, P.C. 2,576,678 I —

Wolf Ross Wolf & Jones 2,392,767 I —

Saveri & Saveri 2,237,409 I —

Schachter & Zwerling 1,541,776 I —

Wolf Haldenstein Adler Freeman & Herz 1,488,920 I —

Goodkind, Labaton & Rudoff 1,208,489 I —

Meredith & Cohen 920,085 I —

Barrack, Rodos & Bacine 918,961 I —

Sachnoff, Weaver & Rubenstein 891,302 I —

Block, Schorr

&

Solis-Cohen 829,231 I —

Pomerantz Haudek Block & Grossman 748,456 I —

Much Shelist Freed Denenberg Ament & Eiger 699,083 I —

& 677,712 I —

Kaufman, Malchman & Kirby 393,758 I —

Stull & 230,813 I —

Hallisey & Johnson/O’Brien & Hallisey 99,617 I —

Prince, Kelley & Newsham (by Zwerling) 25,798 I —

Allan K. Peckel 3,816,661 I —

Harvey Greenfield & Franco Asia 480,567

TOTAL Class counsel $102,992,564

The amount initially requested for attorneys’ fees was also described as “constituting” 13.6% of the settlement fund. Class counsel urge that the requested award is appropriate whether the Court adopts an approach approving such a “percentage-of-

*1082

the-fund” award, or whether it approves an award based upon use of their reported lodestar enhanced by a multiplier.

In addition to Class counsel’s request for fees, the petitioning firms also requested reimbursement of $2,336,438 for expenses incurred in connection with the litigation. That figure increased to $2,482,584.40 as a result of additional work reported through December 31, 1989.

AMBAC Petition

The law firm of Foley & Lardner petitions the Court for fees and expenses in connection with its representation of AM-BAC Indemnity Corporation. Foley & Lardner seeks an award of fees for attorney and paralegal services on behalf of this Class member totalling $134,886. The firm also requests reimbursement for expenses amounting to $9,964.

The Haberman Petitions

The

Haberman

petitioners represented plaintiffs in the Washington state courts. Four firms petition for their representation of individual bondholders. Collectively, the four firms are referred to herein as

“Ha-berman

Plaintiffs’ Counsel.” Two other firms seek recovery of fees and expenses for work done on behalf of

Haberman

Plaintiff Intervenors — American Express Travel Related Services Company, Inc., American Express Bank, Ltd., Fireman’s Fund Company, The American Insurance Company and Associated Indemnity Corporation and United States Trust Company of New York, as Trustee. Together, these firms are referred to as

“Haberman

Inter-venors’ Counsel.”

The

Haberman

petitioners and the amounts sought by each firm are indicated in the following table. In some instances the amounts in initial petitions have been adjusted for mathematical corrections and/or to reflect supplemental petitions submitted.

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These last seven firms seek fees amounting to reported lodestar amounts. They seek neither a multiplier of such amounts nor a particular percentage of the settlement reached in MDL 551.

LEGAL STANDARDS

The ordinary rule in the American legal system precludes prevailing litigants from collecting attorneys’ fees from the losing party.

Alyeska Pipeline Service Co. v. Wilderness Soc.,

421 U.S. 240 , 95 S.Ct. 1612 , 44 L.Ed.2d 141 (1975). There are exceptions to this rule, however. One exception, long entrenched, permits proper allowances to persons who have instituted proceedings for the benefit of a general fund.

Trustees v. Greenough,

105 U.S. 527, 535-36 , 26 L.Ed. 1157 (1882). Courts possess equitable powers to permit persons recovering a fund for the benefit of others to recover costs, including attorneys’ fees, from the fund itself.

Alyeska,

421 U.S. at 257 , 95 S.Ct. at 1621 . The fund amassed as a result of the settlement of the MDL 551 securities class action litigation under Fed. R.Civ.P. 23 meets the requirements of this “common fund” exception to the general

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American rule that would otherwise require every litigant to bear his or her own attorneys’ fees.

Under the common fund doctrine, an attorney may be awarded fees and costs in recognition of efforts that resulted in the creation, preservation or protection of a fund that benefits the class whom the attorney represents. The attorney’s fees and expenses are paid out of the fund. Without such compensation, the beneficiaries of the fund would enjoy its benefits without sharing the costs of acquiring it. To avoid such unjust enrichment, the costs of creating or preserving the common fund are shared by the entire class that has benefit-ted by the attorney’s representation.

In re Nucorp Energy, Inc.,

764 F.2d 655, 661 (9th Cir.1985),

citing Pawlak v. Greenawalt,

713 F.2d 972, 981 (3rd Cir.1983).

The Court acts as a fiduciary, a guardian of the rights of absent class members, in deciding an award of attorneys’ fees in a class action.

Grunin v. International House of Pancakes,

513 F.2d 114, 123 (8th Cir.1975),

cert. denied,

423 U.S. 864 , 96 S.Ct. 124 , 46 L.Ed.2d 93 (1975);

Detroit v. Grinnell Corp.,

560 F.2d 1093 , 1099 (2d Cir.1977)

(“Grinnell II”); In re Capital Underwriters, Inc. Secur. Litigation,

519 F.Supp. 92, 98 (N.D.Cal.1981);

In re Equity Funding Corp. Secur. Litigation,

438 F.Supp. 1303, 1325 (C.D.Cal.1977). Characteristically, defendants have no adversarial interest in fee petitions and no further interest in a fund that is composed of their contributions to settle an action.

6

Plaintiffs’ counsel, otherwise a fiduciary for the class, has become a claimant against the fund created for the benefit of the class. It is obligatory, therefore, for the trial court judge to act with “a jealous regard to the rights of those who are interested in the fund” in determining what a proper fee award is.

Trustees,

105 U.S. at 536 .

The common fund doctrine permits the Court to “make fair and just allowances for expenses and counsel fees to [those] parties promoting litigation.”

Id.

The doctrine requires such awards to be made with moderation,

id.,

and to reflect the reasonable value of the attorneys’ services that resulted in the benefits conferred on the class.

Lindy Brothers Builders, Inc. v. American Radiator & Standard Sanitary Corp.,

487 F.2d 161 , 165 (3d Cir.1973), aff

'd in part,

540 F.2d 102 (3d Cir.1976)

{“Lindy

/”);

Manual for Complex Litigation, Second,

§ 24.12 (1985).

The Court has a great deal of discretion in deciding the amount of fees to be awarded. That discretion is not unrestricted, however. It must be exercised soundly, supported by meaningful reasoning, and be based on sufficient information.

Kerr v. Screen Extras Guild, Inc.,

526 F.2d 67, 69 (9th Cir.1975);

Moore v. Jas. H. Matthews & Co.,

682 F.2d 830, 838 (9th Cir.1982);

Lindy I,

487 F.2d at 166). Above all, the awarded fee must be reasonable.

See Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air (“Delaware Valley I”),

478 U.S. 546 , 106 S.Ct. 3088 , 92 L.Ed.2d 439 (1986). Just as the Court must avoid awarding “windfall fees,” it must avoid any appearance of having done so.

Detroit v. Grinnell Corp. (“Grinnell I”),

495 F.2d 448 (2nd Cir.1974);

Equity Funding,

438 F.Supp. at 1325 .

The determination of a reasonable fee requires the Court to assess the reasonableness of the amount requested in light of several somewhat conflicting rationales. First, fee awards must be adequate to ensure that attorneys will be motivated to undertake representation in class action litigation.

Equity Funding,

438 F.Supp. at 1325 ;

Feuerstein v. Burns,

569 F.Supp. 268, 271 (S.D.Cal.1983). At the same time it must be recognized that the opportunity to represent the class as lead counsel is judicially determined. Class representation is also characterized, in part, as containing an element of public service. This is particularly true of litigation such as this, which arose in the context of the federal securities laws. Those laws are remedial in nature, and private lawsuits to effectuate their statutory purpose of protecting inves

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tors are both necessary and important.

See Bateman Eichler, Hill Richards, Inc. v. Berner,

472 U.S. 299, 310 , 105 S.Ct. 2622, 2628-29 , 86 L.Ed.2d 215 (1985);

Herman & MacLean v. Huddleston,

459 U.S. 375 , 103 S.Ct. 683 , 74 L.Ed.2d 548 (1983).

METHODS OF FEE DETERMINATION

Courts have used different methods in making fee determinations. Some courts have awarded petitioning counsel a percentage of the fund. Others have adhered to the lodestar approach developed in

Lindy I

and refined in

Lindy Bros. Builders, Inc. v. American Radiator & Standard Sanitary Corp. (“Lindy II”),

540 F.2d 102 (3d Cir.1976), multiplying the hours worked by the normal billing rate of the attorneys and adjusting the result, through the use of a “multiplier,” for “contingency” or “quality considerations. This Circuit approves an approach that entails examination, in an orderly lodestar analysis, of factors referred to as the

“Kerr

guidelines.” These guidelines were adopted “as appropriate factors to be considered in the balancing process required in a determination of reasonable attorney’s fees.”

Kerr,

526 F.2d at 70 . The approach that incorporates their consideration in the court’s determination of a reasonable fee is described as a “blend” of lodestar and

Kerr

analysis.

Moore,

682 F.2d at 838-40 .

Class counsel urge this Court to adopt either the percentage-of-recovery or a “lodestar/multiplier” approach in making its fee award.

Percentage-Based Fee Awards

Class counsel request a fee that is approximately 13.6% of the settlement fund. They contend that this would be a reasonable fee. Counsel suggest that the percentage method could be employed here either to determine their fee or, alternatively, to confirm the propriety of the amount they request. (The requested amount can also be computed by applying the requested multiplier to Class counsels’ reported lodestar.) It is the first suggestion — use of the percentage method to

determine

a fee — that this section addresses.

A number of factors preclude use of this method. First, a variety of circumstances reveal that the percentage sought by Class counsel is, in fact, an artificial and fallacious figure. Class counsels’ requested fee actually represents a percentage of the amount of settlement funds that were projected to exist at a future time. Defendants’ settlement contributions amounted to a pre-interest total of approximately $690 million. The amount of fees requested by class counsel in this petition is approximately 14.9% of that pre-interest settlement amount. As a result of interest earnings, the settlement fund was expected to be approximately $757 million by December 1989.

7

That figure, thus, included some $67 million in interest.

It

was the amount used by class counsel to compute the requested percentage, however. As a result of continued accrual of interest after the date selected by Class counsel, the fund has substantially increased, and the percentage derived by comparing the amount requested to the increasing fund has correspondingly decreased.

8

Thus, even if the Court were to award the

amount

requested, using Class counsels’ approach of applying the pre-interest amount of an award to an after-interest amount of the fund, the

percentage

calculated would be constantly diminishing. The Court rejects the “mov

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ing-target” aspect inherent in this approach, and further concludes that, ignoring other relevant factors, 14.9% more accurately describes the percentage of fees actually requested by Class counsel.

Other relevant factors also render Counsels’ percentage computation fallacious. As a result of the allocation to Chemical Bank of $50 million of the settlement fund’s principal,

See

Order dated August 15, 1990, fair treatment would require use of a figure amounting to $640,000,000, not $690,000,000, in computing the percentage to which Class counsels’ request equates. This would further enlarge the percentage actually requested. Even this would not result in a valid figure, however. Class counsel petition for payment of a substantial amount of paralegal fees through the Chemical Bank expense reimbursement request. A determination of the total amount of fees requested by Class counsel would require inclusion of amounts that are related to paralegal fees in that petition. Similarly, fees petitioned for and awarded herein to non-Class counsel firms for work done on behalf of Class members would also require inclusion. Addition of these amounts to Class counsel’s petition would significantly increase the requested percentage. Thus it would be misleading to contend that Class counsels’ request even amounts to just 14.9% of the settlement fund.

Undeniably, application of an appropriate percentage to the settlement fund would provide an uncomplicated solution to this undertaking. A number of considerations preclude such a simplistic approach, however. Foremost among them is the requirement in this Circuit that the Court conduct an analytical evaluation to determine a reasonable fee.

Further, even assuming a percentage-based methodology were acceptable here, the Court finds insufficient guidance to prescribe an appropriate percentage. There is no rationale that would sustain the use of 13.6% (or 14.9%) as precisely the appropriate percentage. Independent of other considerations, a figure of 16.3%, or 3.6%, or 36.1%, might just as well be urged. All of these numbers are arbitrary. Given the variances in the sizes of settlement funds, Class counsels’ data, intended to demonstrate that the percentage they request is far less than the norm, aptly demonstrate the virtually impossible task of setting any particular percentage as a

proper

one.

While many sources indicate that a fee in the range of 20% to 40% may be typical,

see, e.g., In re TSO Financial Litigation,

Nos. 87-7903, 87-7961, 87-8302, 1989 WL 80316 (E.D.Pa.1989), or that, for example, 25%, or 30%, may be an appropriate “benchmark,”

e.g., Paul, Johnson, Alston & Hunt v. Graulty,

886 F.2d 268, 272 (9th Cir.1989),

citing Mashburn v. National Healthcare, Inc.,

684 F.Supp. 679, 692 (M.D.Ala.1988);

In re Activision Secur. Litigation,

723 F.Supp. 1373 (N.D.Cal.1989), it cannot go unnoticed that the immense size of the settlement fund in this action far exceeds the amount of settlement funds in virtually all similar cases that counsel have cited and/or that the Court has reviewed. Just one percent of the settlement in this action is the equivalent of nearly seven million dollars. Every adjustment of .1% (Vioth of one per cent) in an applied percentage would result in a fee variance amounting to approximately $700,-000. A 5% modification in the percentage selected to compute an award would equate to a fee increase or decrease of almost $35,000,000.

Fee awards frequently do not fall in the “typical” range.

9

There is abundant authority that suggests that, as the amount of a settlement fund increases, the percentage of an award should decrease. The proper extent of a corresponding decrease has not been satisfactorily resolved, however, and the Court has found no authority that address a potentially appropriate percentage where the settlement fund is as

*1086

extraordinarily large as it is here. In the absence of specific guidance requiring the application of an appropriate percentage to a given settlement amount, thus, the Court is reluctant to apply

any

percentage in order to determine a fee award. That 20% to 45% of the fund may have been awarded in the “overwhelming number” of common fund situations suggests little if anything about what might be an appropriate award in this

uncommon

case.

The recommendation of the Third Circuit Task Force dictates against use of a percentage-based fee in this case. The Task Force, chaired by the Honorable H. Lee Sarokin, United States District Court Judge for the District of New Jersey, appointed Professor Arthur Miller of Harvard, as its Reporter. The Task Force recommended that, upon counsels' motion, or on the court’s initiative, a percentage fee arrangement should be established, after arm’s length negotiations, by the court and counsel early in the litigation.

Court Awarded Attorney Fees,

Report of the Third Circuit Task Force, 108 F.R.D. 237 , 255 (1985). No motion was made by MDL 551 Class counsel, when the Task Force report was published, when the Class was certified, or at any other time during the litigation to establish a percentage fee arrangement satisfactory to the Court. The time to negotiate such an arrangement has passed. The element of contingency, crucial to such negotiations, is absent, and the incentives to be gained from the establishment of such a percentage have been foregone.

Furthermore, the Task Force observed that a pre-negotiated percentage would involve a sliding scale, dependent on the ultimate amount recovered, and would decrease with corresponding increases in the fund. In a footnote, the Task Force noted that negotiated percentage ranges might include relatively small percents. As an example, the Task Force cited the

Agent Orange

settlement, noting that plaintiffs’ attorneys in that litigation were awarded over $10 million, a fee that equalled only about

six

percent of the settlement fund.

Id.

at 256.

See In re “Agent Orange” Product Liability Litigation,

611 F.Supp. 1296 (E.D.N.Y.1985),

aff’d in part and rev’d in part In re “Agent Orange” Product Liability Litigation,

818 F.2d 226 (2d Cir.1987).

10

Here, the Court is faced with a fee request nearly ten times the

Agent Orange

award and a settlement sum about four times as large.

Class counsel also do not acknowledge the impact of existing fee agreements on other courts’ decisions to grant percentage-based fee awards. Typically, the cases in which a fee was determined in this manner arose from situations in which a contingency fee arrangement provided guidance and supported a percentage-based fee award.

See, e.g., Graulty,

886 F.2d 268 ;

Kirkorian v. Borelli,

695 F.Supp. 446, 455 (N.D.Cal.1988). Such a situation does not characterize this litigation.

Counsel rely on a footnote in

Blum v. Stenson,

465 U.S. 886 , 104 S.Ct. 1541 , 79 L.Ed.2d 891 (1984), in attempting to persuade the Court that the percentage method is the “proper approach” to computing fees in common fund cases.

11

*1087

The

Blum

footnote appears in a section of the opinion observing the general unacceptability of a fee enhancement for “results obtained” in litigation. The footnote appears to have been intended to demonstrate that use of a percentage-based fee could result in inadequate compensation to attorneys in federal civil rights litigation, where a fund might be small relative to the amount of effort required by attorneys to generate the fund.

12

Application of a percentage in such situations would not only result in insufficient compensation, but would also discourage 42 U.S.C. § 1988 litigation.

See Rothfarb,

649 F.Supp. at 185 n. 1.

The

Blum

footnote indicates the Supreme Court’s recognition that the percentage of recovery approach may have legitimate application in appropriate common fund cases. This may be so, for instance, where pre-existing contingent fee agreements provide for a specific percentage recovery.

See e.g. Graulty,

886 F.2d at 272 ;

Kirkorian,

695 F.Supp. at 446 . It does not mandate such an approach. In appropriate circumstances, determination of reasonable compensation for creating a common fund may be accomplished by multiplying the number of hours reasonably spent by a reasonable hourly rate, and then enhancing that figure, if necessary, to account for the risks associated with the representation.

Graulty,

886 F.2d at 272 .

13

Where special circumstances indicate that a percentage recovery would be too large in light of the time spent on the case, or other relevant factors, the use of a benchmark percentage may properly be supplanted by a lodestar calculation.

Six (6) Mexican Workers v. Arizona Citrus Growers,

904 F.2d 1301, 1311 (9th Cir.1990). This action, the amount of the settlement, and the accompanying fee and expense petitions, are replete with special circumstances that dictate against the application of a percentage.

See Florida v. Dunne,

915 F.2d 542 (9th Cir.1990).

Finally, although the Ninth Circuit has not disapproved the use of the percentage of recovery approach in an appropriate case,

Kirkorian,

695 F.Supp. at 455 , it has certainly approved, if not required, the blending of the

Kerr

guidelines in a lodestar analysis in multidistrict securities actions such as this.

Moore,

682 F.2d at 840 (approving the district court’s blended approach in

Capital

Underwriters);

See also, Donnarumma v. Barracuda Tanker Corp.,

79 F.R.D. 455 , at 462 and n. 12 (C.D.Cal.1978).

Blended Lodestar Analysis

The Ninth Circuit has repeatedly held that it is an abuse of discretion for a district court to award fees without considering the

Kerr

guidelines.

Moore,

682 F.2d at 838 . The guidelines enumerate factors that should be considered in awarding fees. The court’s consideration of at least some of the twelve guidelines helps to assure a meaningful review of fee applications. The twelve

Kerr

factors are:

(1) the time and labor required

(2) the novelty and difficulty of the questions involved

(3) the skill necessary to perform the legal services properly

(4) the preclusion of other employment by the attorney due to acceptance of the case

(5) the customary fee

*1088

(6) whether the fee is fixed or contingent

(7) time limitations imposed by the client or circumstances

(8) the amount involved and the results obtained

(9) the experience, reputation and ability of the attorneys

(10) the “undesirability” of the case

(11) the nature and length of the professional relations with the client, and

(12) awards in similar cases

Johnson v. Georgia Highway,

488 F.2d 714 (5th Cir.1974), adopted by the Ninth Circuit in

Kerr,

526 F.2d at 69-70 .

Application of these factors in the context of a lodestar analysis eliminates flaws that would exist if, instead, an independent application of either approach were undertaken. Use of the lodestar framework provides structure that is given flexibility through incorporation and consideration of the

Kerr

factors in the analysis. Use of the lodestar framework helps, for example, to avoid improper effects of redundancy in the

Kerr

guidelines. Use of the

Kerr

guidelines permits a meaningful evaluation of the reasonableness of the hours worked and the rates charged that is not achieved in a “pure” lodestar approach. Blending of the two methods thus permits a systematic and substantive analysis resulting in a determination of a lodestar figure that reflects the number of hours reasonably worked and the reasonable rates at which the hours were worked.

See Moore,

682 F.2d at 839-41 . A strong presumption exists that this figure represents a reasonable attorneys’ fee.

Delaware Valley I,

478 U.S. at 565 , 106 S.Ct. at 3098 ;

Jordan v. Multnomah County,

815 F.2d 1258, 1263 (9th Cir.1987).

Although the lodestar will normally provide full and reasonable compensation, in rare cases, marked by exceptional success, an enhanced award may be justified.

Blum,

465 U.S. at 901 , 104 S.Ct. at 1550 . In such rare cases, the lodestar figure may be adjusted as necessary in the circumstances.

Id.

at 888 , 104 S.Ct. at 1543 . Review of

Kerr

factors that are not subsumed in the lodestar remains, in this circuit, the appropriate procedure for considering a request for an adjustment to the lodestar.

See, e.g., Cunningham v. County of Los Angeles,

879 F.2d 481, 486 (9th Cir.1988),

cert. den. Cunningham v. County of Los Angeles,

493 U.S. 1035 , 110 S.Ct. 757 , 107 L.Ed.2d 773 (1990);

Miller v. Los Angeles County Board of Education,

827 F.2d 617, 621 (9th Cir.1987). Upward adjustments, or enhancements, to the lodestar are generally made through the use of multipliers.

Fee Enhancements — the Use of Multipliers

Historically, courts have stated a variety of reasons for their use of multipliers to adjust lodestar fee determinations. In

Blum

the Supreme Court narrowed the number of factors that had previously been used to support such adjustments in several important ways.

14

Blum

invalidated the use of a multiplier to support an upward adjustment of the lodestar to reflect the novelty and complexity of the issues and the special skill and experience of counsel. The Court observed that these considerations are fully reflected in a lodestar analysis: the former in the number of billable hours recorded by counsel, the latter in the reasonableness of counsel’s hourly rates.

Blum,

465 U.S. at 898-99 , 104 S.Ct. at 1548-49 .

Similarly, the “quality of representation” is also generally reflected in the reasonable hourly rate of counsel, and thus in the lodestar.

Id.

An upward adjustment for “quality” is appropriate only in the “rare case where the fee applicant offers specific evidence to show that the quality of service rendered was superior to what one reasonably should expect in light of the hourly rates charged and that the success was ‘exceptional’.”

Id.

at 899 , 104 S.Ct. at 1549 . The level of performance necessary to qualify for a quality multiplier must be particularly outstanding where, as

*1089

here, a limited fund is available.

Capital Underwriters,

519 F.Supp. at 102 .

Appraisal of the “results obtained,” which is a particularly relevant consideration in civil rights litigation where a plaintiff succeeds only on some of his claims, is also generally subsumed in the lodestar figure.

Blum,

465 U.S. at 900 , 104 S.Ct. at 1549-50 . It is measured by the benefit accruing to the client as a result of the attorneys’ services.

See, e.g., Donnarum-ma,

79 F.R.D. at 461 . The

Kerr

“results obtained” factor is equivalent to the “degree of success” attained in litigation. Both criteria are therefore subsumed within the lodestar and ordinarily should not be used separately to justify an adjustment to it.

Cunningham,

879 F.2d at 486 .

The Ninth Circuit has adopted the

Blum

standards, and recognizes that each of these considerations is contemplated in the blended lodestar analysis. The results of the appraisal of all of the foregoing factors are subsumed within the lodestar, and the factors may not act as independent bases for adjustments of that presumably reasonable figure.

Cunningham,

879 F.2d at 487 ,

Cabrales v. County of Los Angeles,

864 F.2d 1454 (9th Cir.1988). Thus, after

Blum ,

an adjustment of a fee award by use of a multiplier will be justified only in rare, exceptional instances.

Chalmers v. Los Angeles,

796 F.2d 1205, 1215 (9th Cir.1986),

amd. Chalmers v. Los Angeles,

808 F.2d 1373 (9th Cir.1987),

and

on remand

Chalmers v. Los Angeles,

676 F.Supp. 1515 (C.D.Cal.1987).

Further refinement of factors that might justify use of a multiplier were delineated by the Supreme Court in

Delaware Valley I

and

Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air (“.Delaware Valley II”),

483 U.S. 711 , 107 S.Ct. 3078 , 97 L.Ed.2d 585 (1987). Like

Blum ,

these opinions concerned statutory fee questions, but insofar as they address the reasonableness of a fee award, the decisions are applicable here.

See Lange v. Penn Mut. Life Ins. Co.,

843 F.2d 1175 (9th Cir.1988).

The first

Delaware Valley

opinion further resolved the question of whether a court may enhance a fee award to reflect superior quality of representation. The opinion dealt with a

post-Blum

fee award in which an upward adjustment had been granted because it “was ‘the rare case where the fee applicant offer[ed] specific evidence to show that the quality of service rendered was superior to that one reasonably should expect in light of the hourly rates charged and that the success was “exceptional” ’ ”

Delaware Valley I,

478 U.S. at 556 , 106 S.Ct. at 3094 . The Court reversed the application of multipliers, observing that the justification for multiplication — “the ‘superior quality’ of counsel’s performance,” — was fully reflected in the lodestar.

Id.

at 567 , 106 S.Ct. at 3089 . Justice White observed that the fee-shifting statutes, including the one in question, were “not designed as a form of economic relief to improve the financial lot of attorneys.”

Id.

at 565 , 106 S.Ct. at 3098 . The comment is applicable, also, to the federal securities laws.

The second

Delaware Valley

opinion dealt with the issue of whether the attorney for a prevailing plaintiff should or may be awarded separate compensation for assuming the risk of not being paid.

Delaware Valley II,

483 U.S. at 715 , 107 S.Ct. at 3081 . That risk — the risk of losing — is determined by the amount the law is unsettled on the issues and the likelihood that the facts could be decided adversely for the plaintiff.

Id.

at 715-16 , 107 S.Ct. at 3081-82 . The risk is often described as a “contingency risk,” and “contingency multipliers” have generally been the courts’ means of adjusting a lodestar fee for such a risk.

The Ninth Circuit has provided a clear statement of the Supreme Court’s decision in

Delaware Valley II:

[A] majority of the Court held that enhancing a fee award for contingency is permissible if two prerequisites identified in Justice O’Connor’s concurrence are met.... First, the fee applicant must establish that “without an adjustment for risk the prevailing party ‘would have faced substantial difficulties in finding counsel in the local or other relevant market.’ ” [Citation omitted.] Second,

*1090

any enhancement for contingency must reflect “the difference in market treatment of contingent fee cases

as a class,

rather than ... the ‘riskiness’ of any particular case.” ... The fee applicant bears the burden of proving the degree to which the relevant market compensates for contingency. [Citation omitted.]

Fadhl v. San Francisco,

859 F.2d 649, 650 (9th Cir.1988)

(quoting Delaware Valley II,

(footnote and citations omitted). Justice O’Connor’s concurring opinion constitutes the Court’s holding in

Delaware Valley II. See Fadhl,

859 F.2d 650 n. 1.

The record should provide evidence, and the trial court should specifically find, that plaintiff would have faced substantial difficulties in finding counsel in the local or other relevant market without an enhancement for risk.

Delaware Valley II,

483 U.S. at 731 , 107 S.Ct. at 3089-90 .

15

The record does not reveal such a situation in this case. It is undeniable that most law firms would lack the economic and professional stamina necessary to sustain the long, uncompensated involvement required by this litigation. Nonetheless, the deliberate, almost aggressive, efforts to obtain and maintain instrumental roles in this litigation, demonstrated by the numerous firms whose time records are before the Court, is also irrefutable. Absent evidence to the contrary, the Court cannot find that substantial difficulties would have been encountered by these plaintiffs. The record indicates otherwise.

Any enhancement for risks unique to the case — i.e. the existence of new and novel issues, the protraction of litigation, the tenacity of defendants — should be reflected in the number of hours expended and in the hourly rates. They are impermissible bases on which to increase an already reasonable lodestar.

Id.

As with other enhancements, “enhancement for the risk of nonpayment should be reserved for exceptional cases where the need and justification for such enhancements are readily apparent and are supported by evidence in the record and specific findings by the courts.”

Delaware Valley II,

483 U.S. at 728 , 107 S.Ct. at 3088

{citing Blum,

465 U.S. at 898-901 , 104 S.Ct. at 1548-1550 ).

Finally, delay in payment is not an appropriate consideration for a risk enhancement. Delay in payment is, however, appropriately recognized in one of two ways: the fee award can be based on current rates, or the historically-based fee can be adjusted to reflect its present value.

Delaware Valley II,

483 U.S. at 716 , 107 S.Ct. at 3081-82 .

In sum, after these three recent Supreme Court opinions, the Court’s discretion to grant an enhancement or to apply a “multiplier” to a reasonable lodestar fee has been severely restricted. This case presents unique circumstances, however.

While I am keenly aware of the authorities holding that a multiplier is not a commonly accepted vehicle by which to enhance fees or reward counsel for their skill in handling novel and complex issues, I am mindful of the result obtained in this case and the fact that the quality of representation was exceptional. I have lived with this case for over five years. I have observed counsel in a variety of situations both first hand and through the quality of work presented throughout. I have observed the intensity of representation by defense counsel and I know that defendants’ attorneys were of the highest quality that could

*1091

have been arrayed against the resources of Class counsel.

This was a case of overwhelmingly unique proportions, in terms of the amount at issue, as well as the duration of time, numbers of witnesses, numbers of documents, and related matters that demanded the attention to minute detail of Class counsel. It was a rare and exceptional case involving extraordinary services on behalf of Class plaintiffs. I observed counsels’ uncommon dedication and timely attention to the affairs of the Class. It became clear, during the development and course of the litigation, that the undertaking was vastly greater than had been anticipated by counsel when they originally sought and obtained the designation of lead counsel. Lead counsel were precluded from taking a lead role in other class action litigation during the near seven year pend-ency of this case. Consistent with professional responsibility, counsel unwaveringly fulfilled their duty of fidelity to the Class and obtained a result which is, at the very least, sufficient to satisfy the requirements regarding fairness of the settlement. For these reasons I believe that a fee enhancement, for the work of certain attorneys, is neither inappropriate nor proscribed.

A number of attorneys dedicated significant portions of their professional careers to this litigation. Some literally lived with the litigation for more than five years. They underwent personal hardships in the form of long and tedious hours, separation from families, relinquishment of community involvement, and renunciation of other professional pursuits. They devoted themselves to the action, and I believe it became, for some, more than just the mundane object of their work. It engrossed and absorbed their intellects, their energies and their talents. They championed the cause of Class members in the face of commanding and vastly outnumbering opposition. They maintained their tenacity in the face of uncertain victory. All of this was done with absolutely no guaranty of payment. They succeeded admirably. I believe their commitment is worthy of an award that reflects, not only the hours they reasonably worked, but also the unmeasurable but substantial endurance, dedication and deprivations they experienced. The attorneys I deem deserving of monetary remuneration for these intangible aspects of the litigation effort will be indicated, through application of a multiplying factor to their lodestar award, at the conclusion of my lodestar determinations for each applicable firm.

DETERMINATION OF THE LODESTAR

Determination of the lodestar under the blended method begins by equating the first factor in the lodestar approach, “hours spent,” with the “time and labor required” element of the

Kerr

factors. Consideration of the novelty and difficulty of the questions involved will be subsumed in my determination of the required time and labor, in accordance with the guidance provided by the Supreme Court and the Ninth Circuit. The skills necessary to conduct the litigation and the experience, reputation and abilities of the attorneys will weigh heavily in my evaluation of the reasonableness of the rates reported by counsel. The amount involved and results obtained, the nature of the fee, and the desirability or undesirability of the case will also be considered in connection with the appropriate rates and the establishment of a reasonable lodestar.

See, Moore,

682 F.2d at 839 -40 n. 12,

Copeland v. Marshall,

641 F.2d 880, 890 (D.C.Cir.1980).

I will undertake this process, after some comments about the fee petitions in general. I will then set out certain broad guidelines that were used in reviewing the petitions. Thereafter, I will discuss each firm’s separate petition and will indicate, for the work of each attorney for whom payment has been requested, my decisions regarding the hours reasonably expended and the reasonable rate or rates. The sum of these individual attorney lodestar amounts, for each firm, will constitute the firm’s reasonable lodestar award for attorney work. Thereafter, in a similar manner, I will indicate my decisions regarding each firm’s petition for reimbursement for work done by paralegals and/or law clerks. Finally, I will consider and indicate my deci

*1092

sions regarding the expense petitions of every firm, the WPPSS Litigation Fund, and Chemical Bank.

General Comments Regarding the Fee Petitions

Counsel bear the burden of submitting adequately-documented fee applications. Those who fail to, do so at their own risk.

Equity Funding,

438 F.Supp. at 1327 . The burden of proving entitlement to fees out of a common fund rests on the petitioner.

Capital Underwriters,

519 F.Supp. at 102 . Attorneys undertaking representation in common fund cases—including many of those attorneys and firms whose petitions are now before me—have long been on notice of the critical importance of maintaining accurate time records.

E.g., Donnarumma,

79 F.R.D. at 464 ;

In re Continental Illinois Secur. Litigation,

572 F.Supp. 931 (N.D.Ill.1983);

Capital Underwriters,

519 F.Supp. at 104 ;

In re Fine Paper Antitrust Litigation,

98 F.R.D. 48 (E.D.Pa.1983),

aff'd. in part and revd. in part In re Fine Paper Antitrust,

751 F.2d 562 (3rd Cir.1984);

Rothfarb,

649 F.Supp. 183 . Lead counsel firms involved in this litigation have been admonished by other courts regarding the necessity of providing adequate documentation of attorneys’ time.

E.g., Feuerstein v. Burns,

569 F.Supp. 268 ;

Continental Illinois,

572 F.Supp. 931 . In countless opinions of other district and appellate courts, moreover, other petitioning firms have similarly been advised of this need. The requirement is neither novel nor unduly burdensome.

What

is

unduly burdensome, however, is the task that is left to a court as a result of vague, imprecise, illegible, meaningless and generally inadequate records reflecting counsels’ undertakings. The records before this Court contain, to one degree or another, a multitude of such infirmities. The Court has struggled with the records, and has given counsel much latitude in its review. Nonetheless, bearing in mind the burden that rests on counsel, in my analysis I have resolved the uncertainties that remained, where the records were simply inadequate to do otherwise, against petitioners and in favor of Class member claimants to the settlement fund.

Class Counsels’ Fee Petition

Class counsel submitted several documents with their initial fee application. The Declaration of Lead Counsel is primarily a detailed description of the history of this litigation. A small portion of the document, pages 113 to 120, concerns Class counsels’ $103 million fee request. The twenty-five separate Lodestar Declarations contain, for each petitioning Class counsel firm, seven or eight paragraphs that provide the following limited and repetitive information:

1. The declarant’s firm affiliation and reason for the declaration.

2. The firm’s relation to the litigation. Generally, petitioning firms are counsel of record for one of the class representatives. A number of class representatives have more than one firm as counsel of record.

3. A brief description of charts, attached as Exhibits A, and a statement that the charts were prepared from contemporaneous, daily time records regularly prepared and maintained by the firm.

4. A statement that Exhibits B contain a brief biography of the firm.

5. The firm’s total number of hours spent on the litigation and the total “lodestar” amount for attorneys’ and paralegal time.

6. The total amount spent in connection with the litigation, and information (sometimes in a separate paragraph) regarding the firm’s contribution and/or reimbursement from the WPPSS Litigation Fund. Following this is a short list of the categories and amounts of disbursements for which reimbursement is sought.

7. A statement that “[t]he expenses incurred ... are reflected on the books and records of the firm. These books and records are prepared from expense vouchers and check records and are an accurate recordation of the expenses incurred.”

*1093

Exhibits A to these declarations contain lists of each firm’s attorneys, paralegals, and law clerks who worked on the litigation, their total hours (generally through March 1989), their billing rates (generally as of August 1988), and the multiplied “lodestar” for each. The charts also contain a breakdown of reported hours among the following ten categories.

(A) Preparation of Pleadings, including preparation of complaints and related research;

(B) Document discovery;

(C) Depositions, interrogatories, and related work;

(D) Preparation of motions and briefs;

(E) Court appearances and preparation;

(F) Expert related work and damages;

(G) Lead counsel duties and class administration, including proof of claim procedure and communications with class members;

(H) Trial and trial preparation;

(I) Settlement analysis, negotiations and documentation;

(J) Appellate work.

Except for a very broad indication of the general orientation of the work of the applicants, these charts provide little meaningful information. They were prepared after-the-fact, through a review of time records, at the time the fee petitions were prepared. In at least some cases, the categorization was done by clerical employees. For reasons that will become evident, the accuracy of any such summary prepared in retrospect from the petitioning firms’ time records is dubious, at best. Several firms did not categorize all employees’ time and at least one firm substituted even less meaningful categories than the standard ten.

16

Even assuming any real accuracy in the categorization, the amount of time included in each of the ten categories encompasses time spent in that general litigation area, regardless of the nature of any particular activity. A given category, therefore, includes time that may have been spent on research, reading, review, drafting, telephone conversations, discussions, meetings, travel, and myriad other tasks. No summary was provided to describe the amount of time applicants spent in any of those activities, although daily time records often provided such a description.

One perhaps valid conclusion can be drawn from a compilation of all Class counsels firms’ time categorization summaries: At the time the initial petitions were filed, over half of Class counsels’ time on this litigation involved discovery, depositions and expert witness work. An additional 17% of applicants’ time related broadly to the preparation of pleadings, motions, and briefs. About 13% of their time was attributed to preparation for and attendance at court hearings and trial. Approximately 10% of attorney and paralegal time was spent by 19 petitioning firms on “lead counsel duties and administration of class matters.”

17

Settlement activities absorbed about 5%% of the time charged.

Exhibits B to the individual Class counsel firms’ declarations vary significantly in both size and content. They contain biographical information regarding the legal activities of some of the petitioning attorneys and of the firms themselves.

In addition to the exceedingly abbreviated information supplied in class counsels’ declarations and in the bi-monthly “Lodestar Reports” that had been submitted under seal throughout the litigation, petitioning firms were required provide the Court with copies of contemporaneous records prepared to reflect the expenditure of every attorneys’ time. Those detailed records, supplemented by the declarations and bi-monthly reports, and aided by my familiarity with the lawyers and litigation, were used to determine the nature of the work and the reasonableness of the time and labor expended by Class counsel attorneys, paralegals, and law clerks.

*1094

Haberman and AMBAC Petitions

The fee petitions submitted by

Haber-man

counsel and by the law firm of Foley and Lardner vary, both among themselves and compared to Class counsels’ rather uniform declarations. Those petitions contained some of the best, and some of the worst, documentation submitted. They will be discussed, to the extent necessary, subsequently.

GUIDELINES USED IN REVIEWING THE PETITIONS

The amount received as a result of the settlements in this litigation was enormous. The time investment and skill levels required to achieve the sum were correspondingly high. The petitions request payment for more than 200,000 hours of work performed by almost 600 different attorneys and paralegals, not counting those paralegals whose work is reflected in the Chemical Bank expense reimbursement request. The task of determining the reasonableness of the hours and work claimed has not been easy. It has been aided by certain guidelines, however.

The Time and Labor Required

The overriding principle guiding review of these petitions was that the attorneys’ efforts must have provided a benefit to Class members. In order to be eligible for payment of fees out of it, the work must have been undertaken to create, protect or preserve the common fund.

The vast size and scope of this litigation were responsible for much duplication in effort. Numerous separate complaints were filed by many petitioning law firms on behalf of claimants who ultimately became class representatives. Prior to consolidation of the cases, the naming of lead counsel, and the resultant coordination of efforts, thus, a certain amount of duplication was unavoidable. Reasonable amounts of time charged in connection with the preparation and filing of the multiple number of complaints have accordingly been allowed. Needless duplication of effort was unjustified, however, and I have reduced many such time charges, both before and after consolidation, accordingly.

Document discovery accounts for vast portions of the time charged. This aspect of the litigation, which began in earnest in 1984, was immense. Many of the attorneys petitioning herein worked for months on end in connection with plaintiffs’ review of tens of thousands of documents produced by the many defendants in this action. The Court is, of course, realistic about the nature of document discovery and, in a similar vein, deposition preparation. I have not penalized counsel engaged in these pursuits simply for their use of generic terminology to describe their work in connection with such endeavors. Certain reductions have been made to the amounts of time charged to such activities, however, to reduce obviously excessive reported hours to reasonable, productive, amounts.

More than 800 depositions of fact and expert witnesses were taken. Many were brief; others went on for weeks. A vast amount of preparation time was charged, sometimes inexplicitly, for these sessions. Some reductions have been made where time records were too indefinite, or where time charges appeared unreasonable. Occasional reductions have been made where it appeared that too many attorneys charged time for attendance at depositions, or where attorneys charged time for their attendance where it had no ostensible purpose. Time spent in depositions of class representatives, in preparation for them, and on summarization of them, was generally deemed to have accrued to the benefit of the Class, and was allowed. Many time charges that related only to a firm’s client and were of no apparent benefit to the Class as a whole, have been disallowed, however.

In connection with discovery and depositions, and with other events, counsel did enormous amounts of travelling. Occasionally, attorneys noted that they worked en route. Sometimes it was evident that the full amount of lapsed time was not recorded by the attorney. As a rule, however, recorded hours clearly reflected the entire duration of time that attorneys were in transit. With a few exceptions, stem

*1095

ming from specific time entries that required different treatment, therefore, travel time has been reduced by 50%. I am mindful that travel demands took attorneys away from their families and other aspects of their practices, and that travel exacts a toll when regularly undertaken. I do not mean to make light of the fact that many attorneys often worked for significant periods of time while in transit. Rather, I am taking a common sense approach to the effectiveness of work, often conducted after a full day’s endeavor, that was accomplished in transit. I believe that the percentage allowance more fairly represents the benefit to the Class of the time and effort expended by Counsel while in the distracting and disruptive process of transit. While the result may be somewhat harsh for a few attorneys, or, for others, on a few occasions, that impact is more than offset by the many instances in which little or no work was done in transit.

For similar reasons, time charged for conferences and meetings conducted over meals has been reduced in many instances by approximately 50%.

Inadequate documentation was perhaps the single major cause of the Court’s modifications to the requested time and tasks. Many contemporaneous entries were deemed unreasonable, and have been adjusted to reflect reasonable amounts of time for necessary work. Time charges have been disallowed in their entirety in many instances. For example, time simply accounted for as “t/c” or “tel call” or “discussion” or “meeting,” where absolutely no other information was provided regarding either the subject matter or other participant (or participants) in the activity, has not been valued as having provided any measurable benefit to the class.

Time attributed only to “review of pleadings” or “read papers” or to similar review of other generically named, or unnamed, documents has been discounted or disallowed altogether in many cases. While it is acknowledged that, for example, Lead Counsel were required to stay generally informed about everything that occurred in the litigation, the same need did not exist for other Counsel, particularly those whose time charged in the action involved

only

such activities. Therefore, excessive or inessential expenditures of time on such activities have been eliminated.

Significant reductions have been made in the amounts of time charged by several dozen senior members of a number of petitioning firms. Occasionally these reductions eliminated such partners’ lodestar charges in their entirety. The action was clearly top-heavy with senior level partners whose involvement was frequently unnecessary and inappropriate. Nearly 20% of the petitioning attorneys had rates in excess of $250 an hour. Approximately 40% were partners in their firms. Many such individuals contributed little or no work of ostensible value to the litigation. Usually their time records were inexplicit. Sometimes they were incomprehensible. Generally, they were among the most unsatisfactory and substandard ones submitted. In many instances, several (sometimes more) senior level partners of a single firm charged time for what were clearly simple conversations regarding the “status” or “progress” of the litigation. Often these individuals reported absolutely no involvement in the litigation aside from such conversations or occasional review of papers. The Court certainly appreciates the need and value to be derived by counsels’ interaction. Vast amounts of such interaction occurred among and between co-counsel who were actively involved in, and informed about, the litigation. Most such charges have been approved. Nonetheless, the extent of intra-firm (and occasionally inter-firm) communications involving senior level members of petitioning firms who contributed little or no measurable input to the case, was clearly immoderate, excessive, and unacceptable. When viewed as a whole, the time records suggest abusive and reprehensible billing practices in this regard.

18

*1096

The length of time charged to particular tasks was regarded bearing in mind the status of the individual undertaking the task. Occasional reductions were made to the amount of time charged where work was undertaken by a senior level attorney who, because of his or her level of expertise, should have accomplished the work in less time than what was charged.

“Block” entries where many hours in a single day were attributed to, for example, “document review,” have been scrutinized for reasonableness. Block entries for periods in excess of a day have generally been reduced and occasionally disallowed entirely in accordance with counsels’ unmet burden of showing that the time was reasonably spent to the benefit of the Class.

One of the greatest difficulties encountered in analyzing the reasonableness of time spent by counsel on their diverse activities stemmed from the almost routine practice of listing multiple undertakings and attributing a single amount of time to them. The practice is improper and could result in the disallowance of applicants’ requested payments. However, it is fair that attorneys receive payment for the work they did that resulted in the benefits bestowed on the Class. If the Court were to impose the fitting penalty for this imprudent timekeeping practice in this case, few attorneys would receive payment for anything approaching the amount of time they report. Recognizing that the burden is on the attorney to provide adequate time records, the Court contemplated the merits of returning counsels’ records and requiring proper supporting documentation. An attorney’s after-the-fact review and reflective judgment as to the time actually devoted to each different undertaking would not have been more reliable, in my view, than my own, however. The aging daily records contain the most detailed information now available. I therefore used my judgment in determining whether the total time attributed to multiple itemized tasks reflected a reasonable amount of time for the described tasks. Where it did not, the time charge was accordingly reduced.

I have eliminated or reduced many time charges where descriptions accompanying the recorded hours were essentially meaningless.

19

Charges by attorneys who were not significantly involved in the litigation effort, where the activity tended only to provide the inactive attorney with general information, were also disallowed. Charges with no description of any kind of activity have naturally been disallowed. Where an undertaking was insufficiently described, but apparently valid, it was viewed in the context of the attorney’s surrounding charges, and reasonable allowance was made after contemplating any meaning that could be derived in the larger context.

Time charged to prepare Counsels’ lodestar reports, to prepare the fee petitions, to respond to requests for meaningful information supportive of amounts requested, and to urge approval of the firms’ fee petitions has been disallowed. Time charges to these activities varied dramatically among petitioning firms. Some firms charged little or no time. Other firms charged exorbitant amounts, particularly in view of the sparse amount of meaningful information provided. While such charges may be appropriate in the context of, for example, bankruptcy and statutory fee cases, they are inappropriate in common fund cases such as this, because such undertakings confer no benefit on the Class.

Nucorp,

764 F.2d at 661-62 ;

Grinnell II,

560 F.2d at 1102;

Lindy II,

540 F.2d at 111 . Lead Counsel have, however, been permitted reasonable allowances for their work in coordinating the efforts of Class counsel who seek remuneration for their activities in the litigation.

A number of mathematical errors in counsels’ bi-monthly reports and in the summary data presented in the Declarations, were corrected. This Order reflects

*1097

those corrections without necessarily identifying them. A necessary amount of testing was done to verify that reported lodestar totals were supported by daily time entries. Where disparities were identified, appropriate adjustments were made to the reported amounts.

Finally, it must be recognized that it is not possible for a court to evaluate every hour or portion thereof that is claimed in a fee petition such as this. Although the Court reviewed every individual’s time records with care and thoroughness, it did not scrutinize every individual entry. Separately described time charges in these attorneys’ contemporaneous time records ranged from Vioth of an hour to more than 20 hours in a given day. Where fee applications are voluminous, as they are here, it has been recognized that it is unrealistic to expect a trial judge to evaluate and rule on every entry in the application.

Arizona v. Maricopa County Medical Soc.,

578 F.Supp. 1262, 1269 (D.C.Ariz.1984), quoting

New York Asso. for Retarded Children, Inc. v. Carey,

711 F.2d 1136, 1146 (2d Cir.1983).

Courts have utilized and approved percentage cuts as a realistic means of “trimming fat” from fee petitions.

Id.

This Court has, where necessary, adopted such a practice. Such reductions have been made only where abusive timekeeping practices were, in my judgment, clearly evident and extreme. The percentages selected to achieve the reductions in such cases varied according to the nature and/or extent of the abuse. The reductions decreased the time charges for reported activities to reasonable amounts.

Paralegal Time and Labor

Paralegal work has been considered separately in determining the lodestar of each firm. The work of law clerks was assessed with that of paralegals, which it more closely resembled, rather than with the work of attorneys. In reviewing the approximately 27,000 hours of reported paralegal and law clerk work, I applied guidelines much akin to those applicable to attorneys’ time records. The general standard consistently applied was whether the individual’s work provided a benefit to the Class.

Secretarial, librarian or clerical work was occasionally included in the time records of paralegal personnel. Most firms did not charge time for such tasks, but where they did it has generally been disallowed. Firm members’ billing rates take into account the cost of such work, along with that of other office personnel, expenses and profit.

See Missouri v. Jenkins,

491 U.S. 274 , 109 S.Ct. 2463, 2470 , 105 L.Ed.2d 229 (1989). Clients are not billed for these kinds of undertakings; the Class should not pay for them, either.

The Novelty and Difficulty of the Questions

The total amount of time charged for particular undertakings was not viewed in isolation. The issues in the case were neither straightforward nor simple. Many unsettled legal issues were involved. Difficult factual questions challenged plaintiffs’ counsel, and new ground was broken on countless matters. The complexities created by the presence of more than one hundred defendants complicated every undertaking and necessitated enormous amounts of counsels’ time in every activity from service through settlement. Plaintiffs’ claims against these multiple defendants varied, and defendants’ legal positions were even more diverse. Successful conduct of the lawsuit required the participation of many highly skilled and specialized attorneys as well as great expenditures of time because of the new and difficult problems encountered. Those skill levels and time expenditures are reflected by the lodestar.

The Results Obtained and Amount Involved

In determining fee awards in class actions, it is especially important that judges not be unduly influenced by the monetary size of the settlement.

Grinnell II,

560 F.2d at 1099. A sizable settlement can reflect a number of factors in addition to the prestige, skill and vigor of Class counsel.

Id.

Thus, it is imperative that

*1098

the amount of this settlement — the measure of the results obtained in the litigation — be viewed from the proper perspective and in the context of all relevant circumstances.

The settlement sum, over $690 million before interest, is enormous. As a means of appraising the results of this litigation, however, the settlement figure cannot merely be contemplated in isolation. To be meaningful in the instant context, the settlement amount potentially accruing to the benefit of the Class must be adjusted to reflect several allocations of portions of the fund to non-Class members. It must be reduced to reflect the allocation of $50 million of principal to Chemical Bank for the Bond Fund, agreed to by Class counsel in the Plan of Allocation. This amount partially recognizes Chemical Bank’s role throughout the litigation and its contribution to the achievement of settlement. It must also be recognized that, although some prior interest earnings accrued to the benefit of the Class, Class members will see virtually no benefit from interest earned on the settlement fund since January 1, 1990, until after $43.5 million additional interest has been earned by the fund.

20

That amount, plus any subsequent interest earned by it and by the other $50 million allocated to Chemical, is dedicated under the Allocation Plan to the Bond Fund. Thus, a fairer statement may be that the relevant sum — the amount available to Class members and to counsel for their fees and expenses — is approximately $590 million plus some interest.

21

The amount is still extremely high.

High, too, were the losses that brought about this litigation. Ignoring interest lost on Class members’ investments (itself an enormous amount), and accepting calculations utilized by Counsel in the Allocation Plan, Class Plaintiffs’ reported losses on the $2,250 million ($2.25 billion) Supply System Project 4/5 bonds at issue approach $1,470 million ($1.47 billion)

22

. Because the bonds were purchased for the interest they promised, this calculation gravely understates the monetary devastation that many Class members feel.

23

In addition to observing that the amount received in settlement was substantial, and certainly unprecedented in sheer size, therefore, the Court is faced with the inescapable fact that the extraordinary amount appears far more modest when viewed in relation to the injuries sustained by Class members, particularly those many individuals who invested their life savings. Depending on the time of distribution, pre-Termination Class members are expected to recover only about 40% of their computed, “allowable” losses. Post-termination purchasers will recover only about 24% of theirs.

24

Class members’ recoveries will

*1099

not include any amount attributable to lost interest on their investments. The recoveries are fair, adequate and reasonable, however, in light of the claims and defenses in this action.

The Rates Charged

Petitioning firms, with few exceptions, report firm members’ services at rates that were in effect in August 1988. Where attorneys left a firm prior to submission of the petition, the last rate of the attorney was used to develop the firm’s reported lodestar. Both kinds of rates will be referred to, for convenience, as “current” at the time the petition was filed.

25

Class counsel say little about these rates except that they are the attorneys’ “regular hourly rates” and their “hourly billing rates.” I accept Class counsels’ declarations that these figures represent the customary fees charged to fee paying clients as of the stated date, and I regard them as representative of rates prevailing in counsels’ communities for similar services by attorneys of comparable skill, experience and reputation. As such, the rates requested by Class counsel are, with several significant exceptions discussed hereafter, presumed to be reasonable.

Three attorneys from three law firms were appointed by the Court on September 1, 1983, to act as co-lead counsel for Class Plaintiffs in this litigation. Those three attorneys were instrumental throughout the duration of the litigation. They, and members of their firms, along with counsel for Chemical Bank, dominated the litigation and provided the legal and management skills necessary to the conduct and coordination of this massive action on behalf of Class Plaintiffs. These attorneys, and their firms, were at all times responsive to the Court’s needs. They anticipated and accomplished prompt and proper resolution of myriad administrative matters; they coordinated the efforts of Class counsel and, to some extent, of other petitioning firms, on both legal and administrative activities; they provided direction and generally kept the litigation on track.

These three attorneys — Mr. Paul Bernstein of Bernstein Litowitz Berger & Grossman, Mr. Melvyn Weiss of Milberg Weiss Bershad Specthrie & Lerach, and Mr. James Irwin of Shidler McBroom Gates & Lucas — rendered valuable services that required the application of highly specialized skills in excess of those required of other attorneys involved in this action who played lesser roles. Many of those other attorneys’ regular billing rates, in comparable markets, approach or exceed the rates of co-lead counsel. I do not question the appropriateness of such attorneys’ rates in regular matters in which they have greater autonomy and responsibility. Every firm has provided, in Exhibit B of its Declaration, or elsewhere in the case of non-Class counsel, ample evidence of the fine experience, reputation and abilities of its attorneys. I do not believe, however, that attorneys who undertook lesser roles in this litigation, roles that did not require the utilization of all of the skills that co-lead Counsel were called upon to exercise, should recover at their normal rates, which include a premium for specialized and/or leadership skills that were frequently not required of them in this litigation. As a result, a number of attorneys’ rates have been reduced to levels that reflect the more limited skills required here to be utilized by non-lead counsel.

The rates charged by the petitioning attorneys vary tremendously and reflect the range of skill, experience and abilities of the petitioning attorneys. The highest hourly amount requested is $375; the lowest amount is $50. Some rates appear disproportionately low because they were in effect early in the litigation, when the attorney’s only work was performed, and have not been increased in petitioners’ applications because the attorney subsequent

*1100

ly left the firm. Although there are exceptions, partners’ rates generally range from a low of $125 to the high of $375. Associates generally report rates below $200.

Mr. Weiss’ regular billing rate at the time the petition was filed was $350 an hour. Mr. Bernstein’s rate was $315, and Mr. Irwin’s was $200. The disparity among these rates is, in part, attributable to the geographic location of the attorney’s firms. Messrs. Weiss and Bernstein were both partners in New York City firms. Milberg Weiss Bershad Specthrie & Lerach also has an office in San Diego, California. Both attorneys, and the members of their firms, had comprehensive experience with securities and class action litigation. Shi-dler McBroom Gates & Lucas is located in Seattle, Washington, where this action was centered. Mr. Irwin and members of his firm have had significant leadership experience in a variety of legal pursuits.

I find that co-lead counsels’ regular rates establish a ceiling for rates appropriate for the skills necessary to perform the work undertaken by non-lead counsel in this particular action. Adjustments have been made to the reported hourly rates of such counsel where their regular rates exceed the rates appropriate for their work in the litigation. The adjustments reflect the skills necessary to perform the work that was actually done. They take into consideration, as well, the experience, reputation, ability and geographic area of practice of the particular applicants.

Several other adjustments have been made in appropriate instances in connection with reported rates. It is widely acknowledged, for example, that any given task must be performed by an individual with the skills appropriate to the particular activity.

See, e.g., Equity Funding,

438 F.Supp. at 1330 ;

Fine Paper,

98 F.R.D. at 83 . Evaluation of the reported work included a determination that it had been done by an individual whose abilities and experience were commensurate with the task. The extreme example of abuse of this principle occurs where a senior partner undertakes a task that could, and should, be accomplished by a paralegal, or a clerical employee, but nonetheless charges the time at senior partner rates. Some instances of this kind of abuse were identified in some firms’ time records. Other less dramatic instances indicating similar misuse of personnel were reflected, as well. In such cases I have reduced the rate of the individual performing the tasks to reflect a rate appropriate to such undertakings.

Adjustments to requested rates were also made in several other circumstances. A number of attorneys provided services as associates for some period of time. Subsequently, they became partners in the same firm. Because the nature of work undertaken by an associate differed (or should have differed) from that undertaken by a partner, the fee petitions for such attorneys have been adjusted to reflect the hours worked as an associate at a rate commensurate with associate rates current for the firm at the time the petition was made, rather than at the partner rates that were generally petitioned for.

Adjustments were also made to reflect more consistent and reasonable rates in a few situations where attorneys left petitioning firms but continued to do significant work in the litigation for other extant and active Class firms. I believe the worth of such attorneys’ work, to the former firm and to Class members, should be determined consistent with the way it would have been determined had the attorney not changed firms. Thus, I have applied a presumed current rate to the hours reported by the former firms for the work of such persons, rather than the individuals’ reported last-earned rates at the firms.

Paralegal Rates

Nearly all firms included paralegal and law clerk work in their reported lodestar calculations. The hourly rates used to derive the firms’ reported lodestars for such work ranged from $20 to $85 per hour. These amounts reflect billing rates, rather than the cost of the services. They have generally been accepted as reflecting reasonable amounts for allowable work performed.

See Missouri v. Jenkins,

109 S.Ct. at 2472.

*1101

The Nature of the Fee

The sixth

Kerr

factor—whether fee is fixed or contingent—is to be considered in setting the lodestar. This circuit has recognized that there is a vast amount of confusion in the case law regarding contingent fees and contingent, or contingency, adjustments to the lodestar.

Chalmers,

796 F.2d at 1212 n. 4. Contingency adjustments are different from contingency fee arrangements.

Id.

There was no contingency fee arrangement in this case. Nor, clearly, was there a fixed fee. Nonetheless, receipt of any fee was clearly contingent on plaintiffs’ receiving a jury award or upon resolution of the litigation through settlement. This condition is typical of class action securities litigation such as that practiced routinely by most petitioning firms. Their customary rates presumably reflect this fact. It can be fairly assumed that this litigation would not have been pursued by these knowledgeable and experienced attorneys unless, in their view, there was distinct probability that they would recover at least an amount necessary to compensate them for their efforts. Some of the earliest undertakings in this litigation included Counsels’ investigation into the insurance coverage of defendants. That coverage was ultimately the source of much of the settlement proceeds. Settlement efforts were, according to counsels’ time records, undertaken early, as well.

While there has been delay associated with payment for counsels’ work in this action, much as in contingent fee litigation, the impact of that delay has been largely diminished through the use of current rates in the fee petition. Use of those rates, augmented by the application of interest on the fee award retroactive to January 1, 1990, will, in my view, eliminate relevant negative economic effects of delayed payment. Because I have determined to utilize current rates in computing the lodestar, delay in Counsels’ receipt of payment has been fully compensated through the date of the initial petition. I further consider the rates utilized herein to be reasonable as of the date of this Order. Increases in the billing rates of petitioning firms subsequent to August 1988 have accordingly been disregarded.

Finally, counsel must recognize that the amount of time required to assess this fee application was caused, in large part, by the morass of information they provided. The absence of meaningful summaries, the submission of inadequate and disorganized time records, and the almost complete absence of supporting documentation for expense reimbursement requests greatly aggravated and increased the Court’s work and time requirements, which are constrained because of finite resources. Furthermore, because of the pending appeal of the merits, neither the settlement fund nor the fee award may yet be distributed.

Thus, this

Kerr

factor, if applicable at all, does not impact my lodestar determination, except perhaps to leave it unchanged.

The Desirability or Undesirability of the Case

Time records indicate that involvement this case was highly desirable to many of these applicants. This type of litigation is the bread and butter of many petitioning firms. There was no want of Counsel seeking the opportunity to lead the litigation efforts, and no apparent lack of personnel to maintain the undertaking. Tremendous potential for considerable work and sizable fees existed. The predictable delay in receipt of payment, characteristic of such cases, was substantially offset through Chemical Bank’s funding of most of the litigation expenses and many of the legal endeavors. The WPPSS Litigation Fund, implemented by counsel, also minimized the monetary investment required of two of the three co-lead counsel firms. Most firms’ involvement in this litigation, it can be anticipated, can and should make impressive additions to their biographies. For all of these reasons, this factor does not negatively impact the lodestar.

Preclusion of Other Employment

Lead counsel were required not to accept a lead counsel position in any other case until the conclusion of the MDL litigation. Lead counsel and the seven attorneys

*1102

who composed the “Core Group”

26

that managed particular areas of the case under their direction dedicated all or much of their professional lives to this litigation for almost six years. Their time records reflect this commitment.

The Nature and Length of the Professional Relations with the Client

This

Kerr

factor has no particular relevance in this class action. It may, perhaps, explain the involvement of several firms whose members were presumably approached by private clients in connection with bond purchases.

Time Limitations Imposed

Time limitations impacted this litigation, just as they do any lawsuit. Deadlines were frequent, but the Court always attempted to allow adequate time. Discovery was massive, but a multitude of attorneys took part in it. Chemical Bank’s participation, and its maintenance of the Data Center, aided Class counsel’s discovery efforts immeasurably. Generous briefing schedules were authorized and the Court willingly extended deadlines when Counsel requested. Vast numbers of depositions were taken in a relatively short period of time, but countless attorneys were available to prepare for and take them. Certainly there was a greater

number

of deadlines and crises, and more marathon work sessions, than in a typical action, but the legion of attorneys available to cope with those circumstances was correspondingly great. Undeniably, the matter was difficult, wearing and time consuming. Those conditions are reflected in the lodestar through the number of man-hours worked.

See Delaware Valley II,

483 U.S. at 730 , 107 S.Ct. at 3089 .

Awards in Similar Cases

The protracted amount of time required, the considerable number of attorneys and paralegals involved, the vast scope of discovery, the extraordinary expenses incurred, the immense settlement fund, and the enormous amount of fees generated in this case greatly surpass those of nearly every other case of its type. I find that contemplation of this

Kerr

factor is not, therefore, particularly helpful. There are few, if any, truly similar cases; I have found

no

cases with similar fee or expense requests.

EXPENSE REIMBURSEMENT REQUESTS

In addition to the requests for payment out of the settlement fund for the work of attorneys and paralegals, counsel seek to recover money expended in connection with their representation of Class members throughout the course of the litigation.

By far, the most significant portion of litigation expenses was borne by Chemical Bank, under an agreement with counsel for Class Plaintiffs. The petition for those expenses amounts to more than $51,700,000. My decisions regarding that petition are indicated in the section entitled “Chemical Bank Expenses,” which appears at the conclusion of the following lengthy section contemplating the fee and expense petitions of the petitioning Class counsel law firms.

Aside from the expenditures of Chemical Bank that benefitted Class members, each of the petitioning law firms seeks to recover expenses incurred in connection with its own efforts on behalf of Class members. The firms’ initial petitions for recovery of these expenses were inadequate. Little, if any supporting information was provided to document the reported expenses. Most were described in the firms’ declarations by a single word or phrase, many of which had little or no meaning.

Although the succinct and uninformative presentation of Class counsel firms’ petitions was uniform, there were vast incon

*1103

sistencies among the categories and groupings of expenses. Sometimes large reimbursements, for expenditures described only as “miscellaneous,” were requested. Sometimes dissimilar expenses were combined in a single reported sum. The requested reimbursements were complicated by disparate and deficient reporting of counsels’ “contributions” or reimbursements to and/or from the WPPSS Litigation Fund, and by the skeletal information initially provided by the Litigation Fund itself.

The Court required supplemental information to support a number of reported expenditures and, in some cases, all of the required information was still not provided. A number of mathematical errors had to be corrected, and submitted documentation did not always support categories or amounts initially reported. Overall, the expense reimbursement requests submitted by Class counsel were appalling. It is somewhat incredible that many of these firms would provide such inferior documentation to support their often substantial requests.

When the petition was submitted, the twenty-five Class counsel firms and the WPPSS Litigation Fund requested, in the Declaration of Lead Counsel, a total of $2,336,438 for expenses. Additional information submitted with supplemental lodestar reports and corrections of errors in the initial petition adjusted the total amount requested through December 31, 1989, to $2,482,584.40.

The following chart indicates the amounts sought by Class counsel and by the WPPSS Litigation Fund, through December 31, 1989, in accordance with the broad nature of the expenses, after reclassification by the Court. Figures have been rounded to the nearest hundred dollars.

Nature of Expense Amount Reauested

Travel, Hotels, Meals $1,268,100

Reproduction and Printing 395.500

Postage, Express Mail, Delivery 218,800

Research Services 180.500

Telephone Court, Transcript and Witness 172,100

Fees 139,600

Overtime Payroll Expense 59,100

Temporary Personnel, Word Processing 25,700

Supplies and Publications 17,500

Legal Services 4,200

Miscellaneous 1,500

TOTAL $2,482,600

A number of normal litigation expenses do not appear above. Many expenditures, such as expert fees, were funded in whole or in part by Chemical Bank. They will be discussed subsequently.

In addition to the preceding, substantial expense reimbursement requests were also submitted by

Haberman

and AMBAC counsel.

LODESTAR FEE AND EXPENSE AWARDS

Beginning with co-lead counsel firms, and proceeding alphabetically, the following sections reflect the results of the Courts’s analyses and decisions regarding each Class counsel firm’s reasonable attorney and paralegal lodestar award. Immediately following those decisions is a discussion of each firm’s expense reimbursement request and allowance. Amounts awarded for expenses have been rounded to even dollar amounts. Although all reported information has been painstakingly examined, the discussion focuses on those requests that have been disallowed by the Court as a result of its review. Following the discussion of Class counsel firms, the Court discusses the expense petition of Chemical Bank and, finally, the requests of AMBAC counsel and the

Haberman

petitioners.

BERNSTEIN LITOWITZ BERGER & GROSSMANN

The New York City law firm of Bernstein Litowitz Berger & Grossmann (“Bernstein Litowitz”) applies for an award of fees for the work of fourteen attorneys whose rates at the time of the petition ranged from $115 to $315 an hour. When the petition was submitted, the firm reported a total of 30,021.5 attorney hours worked, for a reported attorney lodestar total of $6,877,697.50. Subsequent reports for work performed after March 10, 1989, raised the firm’s reported total attorney hours to 30,775.25 (approximately 15 work-years), and its attorney lodestar to $7,090,-526.25. None of this firm’s supplemental

*1104

reported time through December 31, 1989, will be deferred for later consideration. Substantially all reported hours pertained directly to the primary MDL 551 litigation and settlement and are therefore contemplated in connection with this petition.

The firm’s involvement in the litigation began in February 1983 and continues at this time. The firm is counsel of record for plaintiff Henry Puchall, one of the class representatives in the action. Mr. Paul Bernstein of the firm was named Chairman and co-lead counsel for Class Plaintiffs in September 1983. Members of the firm, particularly Mr. Bernstein, took lead roles throughout the litigation.

With few exceptions, the firm’s daily time records were handwritten by each petitioning attorney, rendering the Court’s evaluation of each person’s participation somewhat time-consuming. With a few minor exceptions, the firm’s reported number of hours was supported by the cumulative amounts recorded on its individual members’ daily time tickets.

Paul M. Bernstein

Bernstein Litowitz Berger & Grossmann petitions for 12,232 hours at the rate of $315 an hour, for a total lodestar of $3,853,080 for the work of Paul Bernstein, co-lead counsel throughout the duration of the litigation. The Court was deeply saddened to learn of the death of Mr. Bernstein in August of this year. His leadership in this litigation was invaluable, and his courtesy in all matters before the Court was exceptional. The number of hours Mr. Bernstein worked in the litigation was exceeded by the hours of only one other attorney. New days passed during the course of this litigation that Mr. Bernstein did not work on it. He frequently worked six, and occasionally seven, days a week. His daily time tickets reflect amounts of less than one hour to more than fourteen hours worked in a day. Typically his daily charges averaged between four and six hours, though many days’ charges, when the litigation was particularly intense, exceeded that range.

Regardless of the number of tasks reported in a single day, only one total time amount was indicated for that day’s work. Because Mr. Bernstein undertook numerous different tasks in a given day, this practice made the Court’s appraisal of the reasonableness of any of Mr. Bernstein’s individual activities somewhat difficult and necessitated the Court’s use of estimates for the time devoted to separately listed tasks.

27

His work descriptions were relatively specific, however, and this facilitated the process somewhat.

The type of work performed by Mr. Bernstein covered the spectrum of activities undertaken by attorneys in the litigation. It included virtually all functions, from research through settlement negotiations. He was involved, to some degree, in nearly every activity that transpired. Although he engaged, to a limited extent, in discovery and deposition activities, in preparation of briefs, and in other kinds of work that are appropriately performed by more junior attorneys, most of Mr. Bernstein’s time was properly dedicated to management of the litigation efforts. The Court does not fault him for his broad participation, which provided him, as co-lead counsel, the necessary ability to monitor and direct the combined efforts of Class counsel. He participated in nearly all hearings, and, in his role of lead Counsel, was responsive to the Court’s requests and solicitous of its needs. He undertook to coordinate the efforts of other Class counsel firms to ensure compliance with the Court’s orders. Although the subject matter of telephone conversations was often not specified in his time records, the names of the individuals with whom he spoke were routinely disclosed and meaningful. Legal papers were generally identified by name, and the activity undertaken in connection with them (drafting, revising, reviewing, etc.) was normally indicated and appropriate to his role. His other activities were also meaningfully described.

*1105

Except for the following, the Court is satisfied that the number of hours reported by Mr. Bernstein reflects a reasonable amount of time expended to properly fulfill the significant and demanding leadership role that he assumed in this litigation.

Mr. Bernstein undertook a substantial amount of travel, particularly between New York and Seattle. When he traveled he generally indicated in his time records that he worked on specific matters en route. The Court’s review of his daily time records, which, because of Mr. Bernstein’s practice of combining all activities into a single daily time charge, necessitated approximations of the amount of time spent travelling, indicates that he requests payment for more than 675 hours spent in transit. The Court has reduced this figure by 338 hours, in accordance with the guidelines previously described. The Court is of the opinion, for the reasons stated, that the lodestar amount attributable to the 338 hour reduction (in excess of $100,000) should not be borne by Class members because of the distractions and disruptions inherent in travel, even if work is performed.

The Court has reduced by 30 hours, for similar reasons, the amount of time reportedly spent by Mr. Bernstein at lunch and dinner conferences with co-counsel.

Finally, more than 250 hours were charged by Mr. Bernstein to Class members for work done in connection with Class counsel’s fee petition. All but 25 hours of this time will be disallowed in accordance with the guidelines adhered to in the Court’s review. The Court finds that 25 hours represents a reasonable time allowance to achieve the necessary coordination associated with Class counsel’s petitions. The remainder of the time charged not only provided no benefit to Class members; it provided only the minimum amount of information necessary to the Court, and then only after it was specifically requested.

In accordance with the foregoing, Mr. Bernstein’s lodestar, based on 11,639 hours reasonably spent at his customary fee of $315 per hour, is $3,666,285.

Jeffrey Klafter

Bernstein Litowitz petitions for 8,609.25 hours at the rate of $185 an hour for the work of Jeffrey Klafter, a partner. The computed lodestar reported for Mr. Klafter’s work is $1,592,711.25.

Mr. Klafter was an associate in the firm from the time he began working on the litigation until he became a partner in early 1988. His rate as an associate was between $130 and $160 per hour. He was a member of the “core group.”

Vast amounts of Mr. Klafter’s work involved preparation for and participation in depositions. Much time was spent analyzing documents. At the time of his advancement to partner, he had completed most of his work in this action. The level of the work performed by Mr. Klafter was not altered significantly thereafter. Much of his later work involved research and drafting of memoranda. The Court believes that $175 per hour, the high associate rate at the time of the firm’s petition, is a fair and reasonable rate for Mr. Klafter’s work throughout the litigation.

Mr. Klafter listed a variety of activities for a single amount of time, though it was not unusual for him to prepare more than one such ticket if he undertook numerous activities in a given day. Charges of 9 to 13 hours were typical, and time charges on many days exceeded even those amounts. Much of Mr. Klafter’s work was conducted in the company of other attorneys who also charged time for the same activities.

The Court’s review indicates that there is a grave probability that both overstatement of time productively spent and/or excessive expenditures of time are reflected in Mr. Klafter’s time records. This is consistently suggested, whether the charge is for a relatively brief task such as a telephone call, or for a 14-hour day preparing for depositions. Thus, the Court will reduce by 15% the total number of hours otherwise allowed for Mr. Klafter’s work. This reduction will result in a reasonable figure for the time spent by Mr. Klafter on activities that provided a benefit to Class members.

*1106

The following reductions, in accordance with the guidelines previously described, are also regarded as reasonable: fifty percent of estimated travel time, 189 hours; fifty percent of meal conferences with co-counsel, 45.25 hours; 13.5 of 14 hours charged on 6/27/84 for two telephone calls with co-counsel; 6.5 hours charged to the preparation of time reports; and 8 hours spent doing paralegal level tasks on 11/4/83, 3/23/84 and 4/26/84. These 8 hours will be paid at a rate of $50 per hour.

In accordance with the foregoing, Mr. Klafter’s lodestar, based on 7,095 hours reasonably spent at the firm’s associate rate of $175 per hour, is $1,241,625. In addition, the paralegal work referred to above will be paid in the amount of $400. The total lodestar award for the reasonable value of the work performed by Mr. Klafter is, thus, $1,242,025 for 7,103 hours work benefitting Class members.

Steve W. Berman

Mr. Steve Berman became an associate of the Bernstein Litowitz firm in March 1986, when he left Shidler McBroom Gates & Lucas. The Bernstein firm petitions for payment for 6,924 hours of work performed by Mr. Berman at the rate of $155 an hour, for a total lodestar amount of $1,073,220. Separately Shidler McBroom Gates & Lucas petitions for an additional 4,650 hours at an hourly rate of $120, or $558,000, for Mr. Berman’s work. Like Mr. Klafter, Mr. Berman was a member of the “core group” and spent a vast amount of time in deposition-related work. Mr. Berman was extensively involved in the preparation of numerous briefs and participated in several Court hearings. Many of his daily charges exceed 8 hours, and charges of between 9 and 14 hours are relatively frequent. The single daily sum of time indicated generally includes various tasks.

Mr. Berman charged at least 587.5 hours in travel time, frequently indicating that he “worked en route.” Although Mr. Ber-man’s time tickets generally include travel time in a single figure, along with other work performed during the day, it is evident that he routinely charged Class members for the total amount of time he spent in transit. A number of trips occurred in November 1988 and January 1989, between Tucson, Arizona, the trial site, and Seattle, Washington, the location of Mr. Berman’s office. His time entries indicated no specific purpose for these frequent trips, and the Court has therefore disallowed payment for 45 hours of travel time in that period. The remaining 542.5 hours spent in transit will be reduced by 50% in accordance with the Court’s guidelines for review of these fee petitions.

Nearly 80 hours were charged to activities associated with counsels’ fee petition work. The Court will allow 8 of these hours, as a reasonable estimate of the time necessary for Mr. Berman’s work, as a member of the co-lead counsel firm of Bernstein Litowitz, to consolidate and coordinate the fee petitions of co-counsel.

Some 31 hours of “wind up” work at the Seattle data base in January 1989 will be allowed at a paralegal rate of $50.

The routine appearance of extremely large daily time charges suggests, for Mr. Berman as it did for Mr. Klafter, a standard practice that involved the recording of “clocked hours” rather than restricting time charges to the actual time productively spent on essential litigation activities of benefit to Class members. Thus, a reduction of 12% of the balance of 6,504.75 otherwise allowable attorney hours will be made, reducing to 5,724 the total number of hours reasonably charged to work of benefit to Class members during the three years that Mr. Berman worked for the Bernstein Litowitz firm. These hours will be allowed at the rate of $155 per hour, for a total fee for attorney work of $887,220. In addition, the firm will receive payment for 31 hours of Mr. Berman’s work at a paralegal rate of $50, for a total of $887,-770.

Rochelle F. Hansen

Bernstein Litowitz petitions for 1,908.5 hours at the rate of $165 an hour, for a total lodestar of $314,902.50 for work done by Rochelle Hansen, an associate.

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Ms. Hansen’s time was largely spent on document production and review, and in preparation for depositions. She also worked on several briefs, fielded telephone calls from Class members, and assessed correspondence and claim information. Her daily time charges for these activities were relatively modest.

Ms. Hansen charged approximately 54 hours to work related to timekeeping and time reporting activities between September 1984 and February 1989. Six hours of this time will be allowed, at a paralegal rate, as reasonable and necessary to the administrative activities of lead counsel.

A two-hour deduction will be made for time charged on 5/2/85 to a conference call with the Court. The call was attended by other attorneys in the firm, and Ms. Hansen’s presence was presumably unessential to Class members. An additional 10.5 hour reduction in the time charged will be made to adjust for the recurring inadequate entries of “review correspondence,” “correspondence,” or “review mail,” included in the activities listed on Ms. Hansen’s daily time tickets. This reduction has not taken into account those entries where a purpose was included in the description, or where a particular document or documents of relevance to the litigation were identified.

In accordance with the foregoing, Ms. Hansen’s lodestar, based on 1,842 hours reasonably spent at an associate rate of $165 per hour, is $803,930. In addition, the firm will receive $300 for 6 hours allowed for the paralegal tasks identified above.

Max W. Berger

Bernstein Litowitz petitions for 358.75 hours at the rate of $275 an hour, for a total lodestar of $98,656.25 for time charged by Max Berger, a partner.

It is difficult to perceive that substantial benefit accrued to Class members as a result of Mr. Berger’s described activities. In 1983, his time records indicate that he spent approximately 30 hours solely on “review of case” and review of “newspaper articles,” “SEC documents,” and “Complaint.” Thereafter, almost all remaining time was attributed to “consideration,” “strategy,” “discussion,” “conference” or “meeting.” Other participants in these reported deliberations were rarely mentioned. When they were, they were generally other partners in the Bernstein Litowitz firm. The subject matter of the conversations or reflections concerned the “status of the case,” “developments,” “settlement prospects,” “staffing” and other general themes. Most conversations, from early 1985 onward, concerned prospects for settlement of the litigation. A number of charges were to “settlement review,” “strategy re: settlement” or, often, simply to “settlement.”

Mr. Berger’s time charges to the above activities almost invariably ranged from .5 to 2 hours, and such amounts were charged regularly until the conclusion of the litigation. He also read several memoranda, Court orders and other documents.

The Court does not mean to disparage the importance of settlement negotiations, or indeed the value of settlement strategy, to this litigation. It was, after all, ultimately resolved in that fashion. However, the Court is unable to conclude that the thought processes and conversations evidenced by Mr. Berger’s inexplicit time records substantially contributed to the achievement of those goals. It is, however, probable that some advantage arose out of his communications with Mr. Bernstein that led to the settlements ultimately achieved. The Court will grant what it perceives to be a reasonable allowance for such presumed benefit.

For Mr. Berger’s settlement efforts, the firm of Bernstein Litowitz is awarded the sum of $22,000, representative of 80 hours of his time reasonably expended to the benefit of Class members.

Edward A. Grossmann

Bernstein Litowitz petitions for 298 hours at the rate of $260 an hour, for a total lodestar of $77,480 for work done by Edward Grossmann, a partner.

According to his time records, the value to Class members of Mr. Grossmann’s involvement in this litigation was limited. A significant portion of his time was charged

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to conferences with co-lead counsel, particularly his partner, Mr. Bernstein. Generally, the subject matter of the “conference” was provided but no other work was performed by Mr. Grossmann in the subject areas. He appears to have drafted some interrogatories and worked on at least one brief. He also participated in and prepared for several depositions and assisted in the development of proof of claim procedures.

Assessment of Mr. Grossmann’s time records was made difficult because of his frequent omission of verbs. It was impossible to discern

what

he did with various documents that were simply named as the entire daily time entry. For example, on 12/9/87 one hour was charged to “letter of credit w/ underwriters.” On 1/23/87, 1.5 hours were charged to “memo in support to [illegible] member of absent class deponents.” The Court was unable to determine whether he read, reviewed, drafted or discussed such documents. Accordingly, time for such entries, unless it was described in the context of other days’ entries within the time period, was not allowed.

The Court will allow, as reasonable, 80 hours of time charged by Mr. Grossmann to reported undertakings at the rate of $260 per hour, as follows:

For conferences with co-counsel on various matters where other work was not performed by Mr. Grossmann — 8 hours. This time is permitted in recognition of the benefit from such discussions that may have accrued to the other, more involved participant, generally Mr. Bernstein, and thereby to Class members. For work on interrogatories — 3 hours. This is a reasonable amount of time for an attorney of Mr. Grossmann’s level to spend on such a task.

For work in opposition to motion to dismiss — 4 hours, for the reason stated above.

For work on the complaint against rating agencies — 3 hours.

For work done in connection with depositions — 40 hours.

For work done in connection with proof of claim procedures, including time spent in meetings with the Settlement Master, Professor Junius Hoffman. Such meetings were also attended by Mr. Bernstein. — 18 hours.

For insurance-related work in May and June of 1989 — 4 hours.

The reasonable lodestar value of Mr. Grossmann’s work is, accordingly, $20,800.

Ronald Litowitz

Bernstein Litowitz petitions for 130.25 hours at the rate of $275 an hour, for a total lodestar of $35,818.75 for time charged by Ronald Litowitz, a partner.

Assessment of Mr. Litowitz’ time records, hindered by their near illegibility, led the Court to the conclusion that the activities of this Bernstein Litowitz partner provided little or no meaningful benefit to Class members. Charges of .25 to 1 or, occasionally, more hours were routinely made to activities described only as, for example, “conf w PMB re progress of case,” “meet w EAG & PMB,” “conf w PMB re en banc brief on § 17,” “settle conf w PMB,” “w PMB re settle w U [presumably Underwriters]” and “TC w PMB re settle.” Similarly, Mr. Litowitz’ occasional Court attendance, his brief appearance at a deposition, and his occasional review of memoranda or other documents cannot be seen as having provided any ostensible benefit to Class members.

While the input of Mr. Litowitz in their frequent conversations may well have been worthwhile to Mr. Bernstein, the Court will not, and cannot, based on the information before it, assume that the work reported by Mr. Litowitz benefitted Class members in any other substantial way. An allowance of $9,900 will be awarded for 36 hours of Mr. Litowitz’ time in recognition of the value his counsel provided Mr. Bernstein, and thereby the Class.

Lawrence C. Browne

Bernstein Litowitz petitions for 92.5 hours at the rate of $175 an hour, for a total lodestar of $16,187.50 for work done by Lawrence Browne, an associate.

Mr. Browne’s work primarily involved research and drafting of legal memoranda. The time is adequately described and the time charges are reasonable for the nature

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of the work. The firm is awarded the lodestar amount reported.

James L. Kainen

Bernstein Litowitz petitions for 101 hours at the rate of $115 an hour, for a total lodestar of $11,615 for work done by James Kainen, an associate. Mr. Kainen’s work was undertaken early in the litigation and included initial research and communications regarding the initiation of the action and the preparation of a complaint. Some of his work also concerned document discovery.

With the exception of 1.25 hours charged to an in-house conference on the last day he worked on the litigation, and a 1.5 hour adjustment to reflect agreement with the supporting documentation provided to the Court, the reported lodestar amounts are considered reasonable and beneficial to Class members. The firm is awarded $11,-298.75 for 98.25 hours of Mr. Kainen’s work.

Joseph B. Mellicker

Bernstein Litowitz petitions for 39.25 hours at the rate of $135 an hour, for a total lodestar of $5,298.75 for work done by Joseph Mellicker, an associate.

Mr. Mellicker’s work involved research and preparation of memoranda, and is reasonable as reported.

Penny P. Domow

Bernstein Litowitz petitions for 31 hours at the rate of $140 an hour, for a total lodestar of $4,340 for work done by Penny Domow, an associate.

Ms. Domow’s involvement in the case was short-lived and inconsequential. Although her practice of allocating time amounts to each listed activity was both unusual and commendable, much of her time reviewing mail and other unspecified documents and conferring with co-counsel was of no apparent benefit to Class members. For her research regarding judicial recusal, of perhaps potential conceivable value to Class members, the Court will allow 4 hours at her reasonable rate, for a lodestar of $560.

Michael J. Meagher

Bernstein Litowitz petitions for 30.5 hours at the rate of $140 an hour, for a total lodestar of $4,270 for work done by Michael Meagher, an associate.

Mr. Meagher’s work involved research on various subjects. Ten hours of his work appears to have concerned only the Bernstein firm’s client, rather than Class members overall. The Class will not be charged for this work, which provided no apparent benefit to its members.

Sixteen hours is a reasonable allowance for the remainder of research conducted by this attorney. Mr. Meagher’s lodestar is, accordingly, $2,240.

Richard A. Speirs

Bernstein Litowitz petitions for 16 hours at the rate of $135 an hour, for a total lodestar of $2,160 for work done by Richard Speirs, an associate.

Most of Mr. Speirs’ work involved pertinent research and will be allowed. However, 3.5 hours charged to his review of the complaint appears excessive and redundant, given the nature of his subsequent research, and 2 hours of his time devoted to discussions with others in the firm about unrelated or unspecified topics cannot be assumed to have benefitted the class.

Bernstein Litowitz is awarded $1,417.50, the reasonable value of 10.5 hours of Mr. Speirs’ research time.

Daniel L. Berger

Bernstein Litowitz petitions for 4.25 hours at the rate of $185 an hour, for a total lodestar of $786.25 for work done by Daniel Berger, a partner.

Except for one hour, payable at a paralegal rate for lead counsel administrative tasks, Mr. Berger’s involvement in this action was insubstantial and provided no apparent benefit to Class members. For his distribution of a Court Order to lead counsel, the firm will receive $50.

The following table summarizes the foregoing lodestar awards determined reasonable for compensable work of attorney members of the Bernstein Litowitz firm.

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BERNSTEIN LITOWITZ BERGER & GROSSMANN ATTORNEY LODESTAR

HOURS LODESTAR

Attorney Request Award Request Award

Bernstein 12,232.00 11,639.00 $3,853,080.00 $3,666,285.00

Klafter 8,609.25 7,103.00 1,592,711.25 1,242,025.00

Berman 6,924.00 5,755.00 1,073,220.00 887,770.00

Hansen 1,908.50 1,848.00 314,902.50 304,230.00

Berger, M. 358.75 80.00 98,656.25 22,000.00

Grossmann 298.00 80.00 77,480.00 20,800.00

Litowitz 130.25 36.00 35,818.75 9,900.00

Browne 92.50 92.50 16,187.50 16,187.50

Kainen 101.00 98.25 11,615.00 11,298.75

Mellieker 39.25 39.25 5,298.75 5,298.75

Domow 31.00 4.00 4,340.00 560.00

Meagher 30.50 16.00 4,270.00 2,240.00

Speirs 16.00 10.50 2,160.00 1,417.50

Berger, D. 4.25 1.00 786.25 50.00

Totals 30.775.25 26.802.50 $7.090.526.25 $6.190.062.50

I believe an upward adjustment of the lodestar award is merited, for reasons previously discussed herein, for the participation and contributions of the following individuals. An increase of their lodestar awards will accordingly be made as indicated.

For the work of Mr. Bernstein, the firm will receive a multiple of 1.4 times the lodestar amount, for a total award of $5,132,799.

For the work of Mr. Klafter, the firm will receive a multiple of 1.2 times the lodestar amount, for a total award of $1,490,430.

For the work of Mr. Berman, the firm will receive a multiple of 1.2 times the lodestar amount, for a total award of $1,065,324.

Paralegals

In addition to the hours reported for attorney members of the firm, Bernstein Litowitz Berger & Grossmann applies for an award for the work of a law clerk and 15 paralegals on the litigation. When the petition was submitted, a total of 2,248.25 paralegal hours were reported. The figure increased to 2,441.25 hours with the submission of supplemental reports for work performed through December 31, 1989. Rates ranging from $35 to $80 per hour were utilized in determining the lodestar for the work of these people. Their reported lodestar, as of December 31, 1989, amounted to $129,640.

The firm’s single law clerk reported 473.5 hours at a rate of $80 per hour, primarily for research and writing on several legal topics pertinent to the litigation. The work was adequately described and appropriately documented in daily time records. The time charges and rate were reasonable and the work will be allowed at the reported lodestar amount of $37,880.

Over half of the remaining reported lodestar (approximately 1,000 hours with a lodestar of $52,450) entailed work associated with time reporting and the firm’s fee petition. The amount requested for this work is excessive, in addition to being of dubious benefit to Class Members. In recognition of the work that the firm did in connection with the coordination and administration of time and expense reporting in its role of lead counsel, however, the Court will allow a reasonable lodestar of 400 hours at a rate of $50 an hour, or $20,000, for this work.

For the remainder of work done by the paralegal staff of Bernstein Litowitz, the Court will allow a lodestar of $47,500 for 950 hours reasonably accruing to the bene

*1111

fit of Class Members. Several time entries reflecting work descriptions including such things as “mailing” or “administrative” have been disallowed.

Paralegal Award

For paralegal work undertaken by the law clerk and staff of Bernstein Litowitz, thus, a reasonable lodestar of $105,380 for 1,823.5 hours will be awarded.

Expenses

Bernstein Litowitz reported a gross amount of $386,425.40 in expenses in connection with the firm’s litigation activities.

Travel

Over half of the firm’s expenditures— more than $201,000 — were made in connection with out-of-town travel. Although the expenses were initially inadequately supported, excellent documentation was subsequently submitted to substantiate the amount requested for reimbursement of firm members’ out-of-town travel expenses. The information was sufficient to permit the Court to determine and assess the nature and purpose of all such expenditures. The amounts claimed included air travel, hotel and meals for attorneys working out of town. Apartment rentals in both Seattle and Tucson were also included when counsel were required to be in those locations for extended periods of time. The rental of such facilities was cost-effective compared to the use of hotels. The Court finds that the firm’s travel expenditures were necessary to the litigation effort and approves them.

Local Meals and Transportation

A separate category of expenses totalling approximately $8,400 was reported for firm members’ and employees’ local meal and transportation expenses. Many of those expenditures appeared to be incurred by individuals in connection with overtime work. Others were charged by firm members who either worked through lunch, went to lunch together (where time records indicated that they sometimes “conferred” or “met” about the litigation), or worked extended hours in their home location. Such meal charges will not be paid by Class members. Overtime meals, if firms elect to pay for them, are an expense of operation. Local meal expenses of professional firm members, particularly in the absence of more formal meeting arrangements than those evidenced by the firm’s records, are personal expenses. They will not be charged to the Class. A deduction of $4,535 for such meal charges identified in the firm’s supporting documentation will accordingly be made.

Communications

The second highest type of expense incurred by the Bernstein Litowitz firm— more than $100,000 — involved the costs of postage, couriers, overnight delivery, telephone and telefax communications. Although seemingly high, the costs arose as a result of the firm’s position as co-lead counsel. They will not be subjected to reduction.

Overtime

Bernstein Litowitz reports a total of $13,260 in overtime expense. This cost of the firm’s operation will be disallowed. Just as secretarial and clerical services are not proper subjects for payment by Class members, neither are surcharges associated with such services. In making its determination that billing rates were reasonable for this firm — and for other firms — the Court took into consideration the need to pay such overhead expenses.

Reproduction

A further deduction will be made to the amounts reported by Bernstein Li-towitz, as it will be made for most other firms, for the expense of photocopying.

28

Initially, the firm imposed a charge of 15

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cents per page for in-house copies. The charge increased in January 1987 to 20 cents, and again in March 1989 to 25 cents. The Court considers the per-page charges, and the resulting $44,200 assessment to Class members, excessive. That this amount may be charged to regular clients by the firm, or that it is “standard” in the firm’s area of practice, is not controlling. Class members will not be assessed an amount that produces a clear and unwarranted profit for the firm. While it is not possible — either for the Court or counsel— to establish a “true” cost for photocopying in this action, a reasonable allowance of approximately $26,500 for in-house copying expense of Bernstein Litowitz will be permitted.

Other

The remaining expenses of Bernstein Li-towitz are relatively moderate, reasonable in the circumstances, and will be allowed.

Expense Award

In accordance with the above, an award of $350,930 will be made to Bernstein Li-towitz for expenses reasonably incurred by the firm through December 31, 1989, in connection with the MDL 551 litigation.

WPPSS Litigation Fund

In its initial petition, Bernstein Litowitz requested reimbursement net of amounts that had already been reimbursed to the firm by the WPPSS Litigation Fund. After a correction to the amount initially reported, the firm reported recovery of $133,-681.43 from that Fund.

In a single figure reflecting the total “Reimbursement of Certain Liaison Costs to Executive Committee,” the WPPSS Litigation Fund separately applied for reimbursement, out of settlement funds, of more than $225,000 previously reimbursed to Bernstein Litowitz and Shidler McBroom. The Court has more properly contemplated the propriety of reimbursement of these expenditures, out of settlement funds, in connection with each firm’s petition, however. Bernstein Litowitz contributed $40,000 to the Litigation Fund. It was reimbursed a greater amount for expenses reported to the Fund during the litigation. Thus, the firm is a debtor of the Fund. Repayment of $93,681.43 is accordingly to be made, concurrent with the firm’s receipt of payment for its approved expenses out of the MDL 551 settlement fund.

MILBERG WEISS BERSHAD SPECTHRIE & LERACH

The New York City and San Diego law firm of Milberg Weiss Bershad Specthrie & Lerach (“Milberg Weiss”) applies for an award of fees for the work of forty-eight attorneys whose rates at the time of the petition ranged from $90 to $350 an hour. When the petition was submitted, the firm reported a total of 34,584.35 attorney hours worked, for a reported lodestar of $8,766,-924.25. By letter dated March 15, 1989, accompanied by a revised lodestar report, the firm corrected its initially reported figures to reflect 34,738.30 attorney hours and an attorney lodestar of $8,792,655.25. Subsequent reports of work performed after the cutoff of the initial (corrected) petition raised the firm’s reported total attorney hours to 36,212.35, and its attorney lodestar to $9,148,776. These last figures, which reflect several minor corrections, include work performed by some of the firm’s attorneys in connection with related insurance litigation. In response to Class counsel’s motion requesting relief from its April 2, 1989 Order, the Court will defer consideration of hours reported by six attorneys in the Milberg Weiss firm for work that was primarily undertaken in connection with insurance litigation. The individual amounts of these deferrals are addressed in the following sections. Consideration of a total of 552 hours for work done prior to December 31, 1989, has been deferred.

The Milberg Weiss firm was, like Bernstein Litowitz Berger & Grossmann, instrumental throughout the litigation. Mr. Mel-vyn Weiss of that firm was co-lead counsel and provided a forceful presence throughout, particularly in settlement efforts. The firm is counsel of record for plaintiff Dr. Joseph Harris, a class representative.

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The firm’s daily time records, initially prepared for each attorney on typed monthly summary sheets, were modified during the course of this litigation. Since July 1984 the firm’s daily time records have been computer-generated. The firm provided its records to the Court in batches, without consolidating in a single location the complete records for each separate petitioning attorney. Orderly review of the work of any attorney, thus, was time-consuming and difficult. The Court is dismayed that a firm with the experience and prominence of Milberg Weiss would present such disorderly supporting documentation for a fee petition of this size. As was true of all other petitioning Class counsel firms, no meaningful summarization identifying specific activities and amounts of time spent on them by each attorney was provided. The generalized categorization summaries prepared by these firms were superficial and not helpful in the Court’s review.

Melvyn I. Weiss

Melvyn Weiss reports a total of 8,121.15 hours worked through December 31, 1989, at a rate of $350 an hour, for a reported lodestar of $2,842,402.50. Of these totals, Mr. Weiss requests that the Court defer consideration of 342 hours reported in supplemental petitions for the period 3/11/89 through 12/31/89, representing a reported lodestar of $119,700. Over half of Mr. Weiss’ supplemental hours during that period of time involve activities that are inextricably related to the primary MDL litigation—in particular to the settlement hearing and the fee application that is the subject of this Order. All 189.5 hours of his reported time, and a corresponding lodestar of $66,325, for work done through May 12, 1989, have therefore been contemplated in connection with this Order. Consideration of the reasonableness of the remaining 152.5 hours recorded between May 18, 1989 and December 31, 1989, however, will be deferred. These hours may be petitioned for later. In sum, this Order contemplates a petition for 7,968.65 hours at a lodestar, based on rates reported at the time the initial petition was submitted, of $2,789,-027.50.

Mr. Weiss’ first time entry in this litigation preceded 1983. One of three primary co-lead counsel for Class Plaintiffs, Mr. Weiss made frequent Court appearances and was actively occupied in trial preparation. He had significant involvement with potential expert witnesses, and was particularly instrumental in negotiations and achievement of the action’s settlement. His activities in related litigation continue at the present time. His reported lodestar was the third highest in the litigation. His time recording practices, unfortunately, reflect a number of shortcomings.

Many time entries indicated only vague or generalized descriptions of the activities he performed. “Review documents” and “review correspondence,” for instance, were the only descriptions provided to account for much of his time. Countless hours were reported, in amounts generally ranging from 15 minutes to two hours, for telephone calls. Usually, the individuals with whom Mr. Weiss spoke were indicated (often only by initials), but the subject matter was rarely specified. Most often his conversations were with co-counsel, frequently Mr. Bernstein. Frequent intra-office conferences were similarly recorded. Many times these communications represented the only work reported in a single day on the litigation. The Court estimates that well in excess of 1,000 hours of Mr. Weiss’ time in the litigation was charged to such inadequately described telephone conversations. The lodestar cost to Class members for 1,000 hours of Mr. Weiss’ time is $350,000. For such a sum, it is not unreasonable to expect Mr. Weiss to have recorded at least a brief explanation of the subject matter of the conversations. The time charges for these calls were clearly rounded to reflect even intervals. The Court believes that, while the conversations undoubtedly occurred, and while they were probably primarily essential to the litigation, it is reasonable, both because of the inadequate information provided and because of the cumulative impact of plainly upward rounding, that Mr. Weiss’ petition for insufficiently documented telephone calls be reduced by 100 hours. A greater

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reduction, though clearly appropriate (and made) for other counsel in this litigation whose timekeeping practices were similarly defective, is not justified in Mr. Weiss’ case. The Court recognizes and acknowledges the importance, in his role as lead counsel, of maintaining effective communication with co-counsel regarding valid litigation efforts. It assumes the remainder of time charged in the above manner is within the zone of reasonableness. In any future petitions, however, more specific descriptive information will be expected.

In addition to verbal communications, Mr. Weiss participated in numerous other litigation activities. He participated, generally to an appropriately limited extent, given his seniority, in discovery activities, document review and in the preparation of briefs. He attended a surprisingly large number of depositions, frequently charging 10 to 12 hours a day during such periods. Over the three-month period between April and June of 1985, for example, in excess of 300 hours were charged by Mr. Weiss for his preparation and attendance at depositions that were also attended by other co-counsel. In one four-day period in September 1985, 41 hours were charged to “attended depos in Seattle.” Over 150 hours in July of 1986 were charged to a deposition. Because he consolidated multiple daily activities under one hourly sum, it was impossible for the Court to determine precisely the total number of hours so-charged. Nonetheless, given his leadership position in this litigation and his commensurate high hourly rate, the Court believes that his time charges for these activities were excessive. A 100-hour reduction will be made to reduce to a reasonable level Mr. Weiss’ overall time charged for preparation and attendance at depositions, many of which were properly conducted by more junior counsel at lower billing rates. The significant remainder of time permitted for Mr. Weiss’ appearances is allowed in order to recognize the importance of deposition testimony to Plaintiffs’ case in this action.

Mr. Weiss undertook a great deal of travel in the litigation. Although he generally charged the full extent of travel time, on occasion fewer hours were charged to the litigation than the trips required. In accordance with the previously established criteria, a reduction of 360 of the 720.5 hours attributed to Mr. Weiss’ travel time charges will be made.

Similarly, a reduction of 10.25 hours has been made to eliminate inefficacious time charged for meal meetings.

At least 187 hours were charged by Mr. Weiss in connection with Plaintiffs’ fee application through the hearing date. Ignoring the firm’s requested multiplier of 3.52, the charge to the Class for this time would exceed $65,000. With the requested multiplier, the Class would be assessed more than $230,000 for these efforts. Either result would be offensive. For his work as lead counsel on fee matters associated with the consolidated petition of Class counsel, the Court will permit payment for approximately 20 hours.

Finally, the documentation provided to the Court for Mr. Weiss’ work encompassed 60.6 hours fewer than the lodestar number of hours reported for Mr. Weiss. This amount accordingly has been deducted from the lodestar hours reported.

In accordance with the foregoing, after the deduction of 797.85 hours, Mr. Weiss’ lodestar for compensable work, based on 7,170.80 hours reasonably spent at his customary rate of $350 per hour, is $2,509,780.

Alan Schulman

Milberg Weiss reports a total of 11,889.55 hours at the rate of $235 an hour, for a total lodestar of $2,794,044.25 for work done by Alan Schulman, a partner. This Order contemplates only 11,709.55 of his hours, with a corresponding lodestar value of $2,751,744.25. Consideration of 180 hours worked between 10/11/89 and 12/31/89 by Mr. Schulman, primarily in connection with related insurance litigation, has been deferred.

Mr. Schulman came to Milberg Weiss in 1984 from the law firm of Graham & Dunn, where he had also been active in this litigation. Graham & Dunn separately petitions for 1,126.2 hours for work performed by Mr. Schulman at a partner rate of $115 per

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hour. The combined total of time reported for Mr. Schulman in the MDL litigation since 1983, excluding his continuing work in related insurance actions, thus, exceeds 13,000 hours. His time worked in this lawsuit, exceeds that of any other attorney, and probably sets a number of similar records outside this litigation arena, as well.

Mr. Schulman was an associate in the Milberg Weiss firm prior to September 1985. The firm’s petition and computed lodestar, submitted at his current partner level rate, did not take into consideration the change in the nature of work and responsibilities that accompany such a change in status. For compensable work Mr. Schulman performed until September 1985, therefore, the firm will receive a lodestar award based upon a current hourly associate rate of $185. For work performed thereafter, the Court will apply his current partner rate of $235 to his compen-sable hours.

A member of the “core group,” Mr. Schulman was deeply involved with discovery matters, particularly with document review and, more extensively, depositions. He also actively and intensively participated in brief writing and other motion work, occasionally in group sessions that involved other Class counsel. Although they contain somewhat generalized descriptions, and combine various tasks under a single daily quantity of time, Mr. Schul-man’s time records are comparatively explicit.

Mr. Schulman infrequently charged fewer than 8 hours on a weekday. He often charged 2 to 5 hours for work done on weekends. On more than 500 occasions, he charged between 10 and 18 hours for a single day’s work. Larger charges, including an obviously erroneous one for 29 hours (2/29/88) were also occasionally made. In January 1987, he logged between 12 and 19 hours on 16 of 22 days worked. He did not report any hours the following month. Many entries simply do not reflect a reasonable amount of time for the activities indicated. On 12/18/87, for example, he charged 6 hours for three telephone calls and review of WPPSS mail. On 1/5/88, he charged 5 hours for review of a letter and one telephone call. Such entries are not infrequent. Entries that reflect 10 or more hours for “deposition preparation,” or 12 hours for “work on” some other analytical aspect of the litigation are frequent, and generally appear to overstate actual productive endeavors.

Several things are evident to the Court regarding Mr. Schulman’s time charges at Milberg Weiss. First, it evident that Mr. Schulman was diligent. Second, it is equally apparent that Class members have been assessed in a manner that reflects the passage of time, rather than the actual conduct of work of a beneficial nature to them. A significant amount of overlap is also apparent in connection with much of the work of Mr. Schulman. Many times several attorneys billed hours for joint undertakings, resulting in excessively high hourly charges. While high staffing levels were clearly essential in this litigation, many joint activities entailed redundancies that should not be passed on to Class members. A reduction of approximately 12% of the hours reported by Mr. Schulman will accordingly be made to adjust his compensa-ble time charges so that they reflect a reasonable and productive amount of time spent on litigation activities. A separate correction of 15 hours will be made to reduce the entry of 2/29/88.

In addition, a reduction of 412.25 of 824.5 hours of travel time reported in Mr. Schul-man’s time records, apportioned between his time as an associate and his time as a partner with the firm, has been deducted from his reported lodestar total. Similarly, 26.75 hours spent at meals with co-counsel have been disallowed. Finally, 166 of 181 hours attributed to work on the fee and expense petition have been disallowed. The permitted 15 hours are a reasonable allowance for his work relating to the coordination of Class counsels’ petitions.

For Mr. Schulman’s reported associate hours, Milberg Weiss is awarded $512,-172.50, a reasonable lodestar amount for 2,768.5 compensable hours worked at a rate of $185 per hour. For his time as a part

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ner, the firm is awarded an additional reasonable lodestar amount of $1,641,686.50, for 6,985.9 hours at a rate of $235.

Leonard B. Simon

Milberg Weiss reports a total of 9,616.5 hours at the rate of $235 an hour, for a total lodestar of $2,259,877.50 for work done by Leonard Simon, a partner. Of the total hours reported, 199.75 were for work done after 3/11/89. Most of the subsequent work, however, related to the MDL 551 settlement hearing and fee petition. Therefore, all time reported through December 31, 1989, except for 23.25 hours worked on and after October 24, 1989, will be considered in connection with this Order. The 23.25 hours may be petitioned for in a future petition. Considered herein, thus, are 9,593.25 hours at a reported lodestar of $2,254,413.75.

Like Mr. Schulman, Mr. Simon was an associate of the firm before September 1985. The firm, however, applied for payment for all of his work at a partner rate. For compensable hours worked prior to his change in status, his lodestar award will be based on an associate rate of $185. For time allowed for work thereafter, he will receive his current customary hourly rate of $235.

Mr. Simon was also a member of the “core group.” He began working on the case in February 1983. He charged more than 200 hours to work on the first and second amended complaints in the action and, in about five weeks during 1983, charged more than 200 hours for his efforts on briefs in opposition to defendants’ motions to dismiss. In late 1985 and early 1986, over 160 hours were recorded for his work on a settlement memorandum. He worked, as well, on a number of other important briefs and memoranda. Other plaintiffs’ counsel, including Mr. Schulman, also charged time to all or most of these undertakings. Mr. Simon was heavily involved in discovery work, particularly document review and, later, depositions. He made a number of Court appearances, and interacted with various retained experts.

Mr. Simon’s time records are relatively descriptive of his work. For the most part, his time charges are modest and appear reasonable. Many of his long days reflected travel, and deductions have been made to reduce by 50% the 633 hours charged in this manner. Additionally, nearly 119 hours of meal time charges with co-counsel have been reduced, in the same manner, by 50%. The Court does not discern that any appreciable benefit accrued to Class members as a result of 50.5 hours spent by Mr. Simon in the final months of 1988 reading the trial transcript. Finally, 39.5 hours have been disallowed for the portion of the time charged by Mr. Simon for fee work during the post-settlement stage of the litigation.

For Mr. Simon’s associate hours, Milberg Weiss is awarded $668,220, a reasonable lodestar amount for 3,612 compensable hours worked at a rate of $185 per hour. For his time as a partner, the firm is awarded an additional reasonable lodestar amount of $1,296,083.75, for 5,515.25 hours at a rate of $235.

Michael Spencer

Milberg Weiss petitions for 2,267.25 hours at the rate of $200 an hour, for a total lodestar of $453,450 for work done by Michael Spencer, a partner. All of Mr. Spencer’s reported work through 12/31/89, including 8.75 hours reported after the initial petition, will be considered at this time. Mr. Spencer began working for Milberg Weiss in June 1986. Prior to that time he had worked for the law firm of Cravath, Swain and Moore, which represented Plaintiff Chemical Bank in this litigation. Mr. Spencer became a partner in the Milberg Weiss firm on or about July 1, 1987. According to the detailed information provided with the firm’s petition, he had worked approximately 1,557 hours for Milberg Weiss at that time. His compensable hours prior to July 1, 1987, will therefore be paid at a current associate rate of $185.

Initially Mr. Spencer indicated, for each of the daily tasks he performed, a separate allocation of time. That commendable practice ceased, however, after a few months at Milberg Weiss, and the Court was once again tasked with the burden of determining the reasonableness of a single

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total hourly sum for multiple daily activities grouped together. For the most part, however, even after the modification, Mr. Spencer’s charges were moderate and reasonable. Occasionally a large number of hours were charged in a given day, but such charges, when they occurred, appear reasonable for the work performed, which often involved depositions. In addition to deposition work, Mr. Spencer also worked on several important briefs.

A recurring entry in Mr. Spencer’s time records concerns his review of incoming mail, materials, paper, documents, and the like. Insofar as they may have provided a benefit to Class members, particularly in 1988, after his involvement in the action was substantially reduced, the time charges for this activity are somewhat excessive. A reduction of 45 of nearly 65 hours so allocated has therefore been made. Additionally, 42.5 associate hours and 27.5 partner hours have been disallowed of the 139 hours of travel time charged. Finally, a deduction of 10 hours has been made for time charged for work on the fee application and for other matters that provided no benefit to Class members.

For Mr. Spencer’s associate hours, Mil-berg Weiss is awarded $280,182.50, a reasonable lodestar amount for 1,514.5 com-pensable hours worked at a rate of $185 per hour. For his time as a partner, the firm is awarded an additional reasonable lodestar amount of $125,550, for 627.75 hours at a rate of $200. The firm’s total lodestar award, thus, for Mr. Spencer’s work is $405,732.50.

Antonia Russo

Milberg Weiss petitions for 966.75 hours at the rate of $150 an hour, for a total lodestar of $145,012.50 for work done by Antonia Russo, an associate. Ms. Russo began working on the case in March 1988. Her work pertained to settlement agreements, and appears largely to have been directed at settlement funding arrangements and controls. She was also involved in the drafting of settlement and escrow agreements, and in the preparation of the Class Notice regarding the fairness hearing. Her time charges were, for the most part, modest. In the few instances that they were not, the reasons are usually evident. The only reduction in the hours reported for Ms. Russo is for 7.25 hours, one-half of the allocated round-trip commutation time between New York and Seattle in January 1988.

For Ms. Russo’s work on the litigation Milberg Weiss will receive a lodestar award of $143,925, for 959.5 hours at $150 an hour.

David J. Bershad

Milberg Weiss petitions for 358.15 hours at the rate of $300 an hour, for a total lodestar of $107,445 for work done by David Bershad, a partner. Mr. Bershad made moderate time charges for his work in the litigation from early 1983 until late 1989. All of Mr. Bershad’s reported work through 12/31/89, including 11.5 hours reported after the initial petition, will be considered at this time.

Mr. Bershad’s time recording practices were excellent. His undertakings were satisfactorily described and relevant to the litigation effort. His most significant early involvement concerned the deposition of the firm’s client, class representative Dr. Joseph Harris. His charges for this time were modest, and will be permitted as having been essential to the Class overall. Later work involved settlement funding arrangements. Again, his time charges were moderate, compatible with his level, and well-explained. The only deduction that the Court believes appropriate is for slightly over 14 hours of time charges for telephone conversations in the final months of 1988 with Mr. Weiss regarding the status of trial, settlement negotiations, and similar matters. While the subject matter was understandably of great interest to Mr. Bershad, the Court is unable to conclude that his time, in addition to that of Mr. Weiss, should be assessed to Class members. Thus a reduction of $4,245 will be made from the reported lodestar.

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In recognition of David Bershad’s work in this action, the firm of Milberg Weiss will receive a lodestar award of $103,200, representing 344 hours work at his customary rate of $300 per hour.

George A. Bauer III

Milberg Weiss petitions for 547.55 hours at the rate of $180 an hour, for a total lodestar of $98,559 for work done by George Bauer, an associate. Much of Mr. Bauer’s work was performed after the initial petition was submitted. Virtually all of the work appears to relate directly to the primary MDL 551 action, however, particularly to the settlement agreements. It will therefore be contemplated in connection with this Order.

Mr. Bauer’s compensable work, which began in January 1989, primarily involved the Class Notice, tax concerns, and escrow arrangements associated with the settlements. The work is adequately described and appropriate and, while the time charges appear to be slightly greater than necessary for some tasks, they are not unreasonable. Several charges, however, will be disallowed as follows: .3 hours for inconsequential tasks in 1985; 6 of 8 hours charged on 12/14/89 and 12/15/89 because the charges were excessive; .75 hour charged on 8/17/89 to circulate a ruling request; and 1.5 hours on 9/7/89 presumably spent reading the Court’s opinion on the settlements. It would be unfair to burden the Class for every attorney’s review of that Order.

For Mr. Bauer’s work through December 31, 1989, Milberg Weiss will receive a lodestar award of $97,020 for 539 compensable hours at the rate of $180 per hour.

Steven G. Schulman

Milberg Weiss applies for 413.9 hours at the rate of $185 an hour, for a total lodestar of $76,571.50 for work done by Steven Schulman, an associate. Mr. Schulman began working on the litigation in June 1986. He worked on several depositions and did research and drafting in connection with plaintiffs’ briefs on several important issues in the case.

Some of Mr. Schulman’s time charges were not appropriate charges to Class members and will be disallowed. Between October 14 and October 17, 1986, he charged 46 hours for his travel between New York and Seattle and to attend a hearing and a meeting. Although he had done some work on matters that were the subject of the hearing, his presence, considering the attendance and participation of a number of other plaintiffs’ counsel, was unnecessary and redundant. All of Steven Schulman’s time in this period will be disallowed. Seven hours charged for meal conferences with co-counsel and for other travel will also be deducted. Finally, a reduction of 15.5 hours will be made to adjust for recurring and excessive charges to “review of correspondence,” “review of files,” and for insufficiently defined “conferences” with other plaintiffs’ attorneys.

For Mr. Schulman’s work, Milberg Weiss will receive a lodestar award of $63,899 for 345.4 hours of compensable work at the rate of $185 per hour.

Arnold N. Bressler

Milberg Weiss petitions for 321.75 hours at the rate of $230 an hour, for a total lodestar of $74,002.50 for work done by Arnold Bressler, a partner. Nearly all of Mr. Bressler’s time was charged in 1988 and 1989. Although some of his reported time charges evidently pertain, to an indeterminate extent, to insurance litigation in other courts, they also relate directly to settlement agreements made in MDL 551. All time reported through December 31, 1989 will therefore be contemplated at this time.

Mr. Bressler’s time records are terse, generally uninformative, and appear to contain consistently excessive charges. Several examples follow:

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1/20/88 S-REVISED LTR OF CREDIT; OC-DJB 2.5 hrs.

10/13/88 OCS-AMR/GHC RE COLUMBIA SETTLEMENT 6.0 hrs.

1/4/89 T-AMR; OCS-GAB; TS-NIEDERBER-GER, PAGNANELLI RE COLLECTION OF L.C’S; REVISED EBASCO LTR CREDIT & LTR AMT 12.5 hrs.

2/13/89 L/C COLLECTION 4.0 hrs.

2/24/89 T-CIRILLO; T-GOLDSTEIN; L/C’S; S-MHT AGMT; OC-GHC 6.75 hrs.

3/10/89 L.C. DOCUMENTS 4.75 hrs.

4/11/89 OCS-LM/GAB; TC-JACOBSON/GAB/LM 3.25 hrs.

Although the Court was able to decipher the meaning of the various abbreviations, it was unable to conclude that the amounts of time charged to these, and to virtually all other undertakings of Mr. Bressler, were reasonable. The burden of providing satisfactory evidence of compensable work was not met. As a result, but in recognition that some important work, particularly in connection with letters of credit for settlement funds, was apparently performed, an award of approximately 40% of Mr. Bres-sler’s reported hours will be made. The Court believes that its decision to recompense the firm for some of his reported time is fair, and a lodestar award of $29,-670 for 129 hours at the requested customary rate of $230 is judged reasonable.

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Jerome M. Congress

Milberg Weiss petitions for 212.65 hours at the rate of $260 an hour, for a total lodestar of $55,289 for work, done by Jerome Congress, a partner.

Mr. Congress’ compensable involvement in the case began in mid-1985, when he charged 124 hours for work on a brief opposing the motion of Ernst & Whinney to dismiss Plaintiffs’ claims against them. His allowable time for this work will be reduced to 100 hours, a reasonable figure for this type of undertaking for someone at his level. In 1988 Mr. Congress charged Class members for 56.5 hours of work related to the review and revision of a settlement brief. He will be compensated for 40 hours of this time, as well as for 25 hours during 1988 that he worked on expert testimony matters and on briefs related to the Washington State Supreme Court

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action. These amounts of time are reasonable for the performance of this sort of work at his level.

For Mr. Congress’ work, Milberg Weiss will receive a lodestar award of $42,900 for 165 hours reasonably expended at the hourly rate of $260.

William S. Lerach

Milberg Weiss petitions for 113.5 hours at the rate of $325 an hour, for a total lodestar of $36,887.50 for work done by William Lerach, a partner. Mr. Lerach charged time for his involvement in the litigation from February 1983 through December 1985.

Mr. Lerach’s time records are not adequate to support the firm’s request for compensation for his work. His time entries primarily involve block entries of up to 20 hours of time for weekly intervals. The accompanying work descriptions indicate that his involvement, aside from some initial work drafting complaints, consisted mainly of reading articles, memos, briefs, and holding conversations with other attorneys in the firm regarding organizational matters. Such time, while perhaps important to the firm’s planning, was of little benefit to Class members.

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Recognizing that some benefit accrued to the Class as a result of his review of plaintiffs’ brief on motions to dismiss, and from his work drafting complaints, the Court will permit payment for 40 of the hours charged by Mr. Lerach. No payment for the remaining reported time will be allowed. Payment will be made at a rate of $300 per hour, reflecting an adjustment for the relatively insignificant role he played in this particular action. His lodestar is, accordingly, $12,000.

Elizabeth A. Shollenberg

Milberg Weiss petitions for 232.5 hours at the rate of $120 an hour, for a total lodestar of $27,900 for work done by Elizabeth Shollenberg, an associate. All of Ms. Shollenberg’s work in the litigation was performed in 1983 and 1984. Much of her work involved the routine review, organization, filing and distribution of documents. Other undertakings, including research, cite checking, proofreading, gathering cases, handling telephone calls and interviewing

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