# Lonardo v. Travelers Indemnity Co.

> District Court, N.D. Ohio · July 21, 2010 · 706 F. Supp. 2d 766

URL: https://www.frixlaw.com/law-library/cases/2538499

## Case

- **Full name:** Paul LONARDO, on Behalf of Himself and Others Similarly Situated, and Dante Frezza, on Behalf of Himself and Others Similarly Situated, and Joseph Feldman, on Behalf of Himself and Others Similarly Situated, Plaintiffs, v. TRAVELERS INDEMNITY CO. Et Al., Defendants
- **Court:** District Court, N.D. Ohio
- **Decided:** July 21, 2010
- **Citations:** 706 F. Supp. 2d 766; 2010 U.S. Dist. LEXIS 73703; 2010 WL 1416698
- **Precedential status:** Published
- **Opinion:** Opinion by O'Malley
- **Judges:** Kathleen McDonald O'Malley
- **Cited by:** 96 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/2538499

## How later opinions describe it (automated extraction)

- stating that the percentage-of- 30 Settlement Agreement, ECF No. 73-2, ¶ 60, at PAGEID # 571; Coffman Decl., ECF No. 73-3, ¶¶ 26, 51; Bryant Decl., ECF No. 73-3, ¶¶ 26, 36, 49. the-fund method is the “preferred method for common fund cases, where there is a single pool of mone…
- rejecting objection that “the [claim] form is unnecessary because it does not provide [defendant] with any information they do not already have” in part because “the claim form and opt-in procedure are negotiated components of the settlement that [defendant] insisted upon in o…
- finding that the public interest served by class-wide recovery “that, but for [the] litigation, would almost certainly have gone uncompensated”
- stating that “percentage of the fund has been the preferred method for common fund cases”

## Opinion text

OPINION & ORDER
KATHLEEN McDONALD O’MALLEY, District Judge.
After nearly five years of remarkably contentious litigation, in September 2009 the parties reached a Settlement Agreement
1
resolving all of the claims in this class action lawsuit. Now ripe and pending before the Court are two motions occasioned by this settlement: (1) Plaintiffs’ Motion for Final Approval of Class Action Settlement and Incentive Award to Class Representatives (“Motion for Final Approval”) (Doc. 175); and (2) Motion for Order Granting Settlement Class Counsel’s Petition for Award of Attorney Fees and Expenses (“Fee Petition”) (Doc. 176). For the reasons articulated below, both of these motions are GRANTED. Accordingly, the Court APPROVES the Settlement Agreement (Docs. 168, 190) and enters final judgment DISMISSING the case. Further, the Court AWARDS Class Counsel’s fees and expenses in the amount requested, as calculated herein. Finally, the Court DENIES Mr. Greenberg’s request for leave to file a petition for attorneys’ fees (Doc. 191).
I.
BACKGROUND
This is a case about homeowners insurance premiums. The Plaintiffs allege that
*771
the Defendant insurance companies sold consumers one homeowners insurance policy while unlawfully concealing the availability of a lower-priced policy that provided identical coverage and service. The Defendants admit that they sold identical policies at different prices, but have consistently denied, and continue to deny, that their conduct was unlawful in any way. The parties’ Settlement Agreement fully resolves the case, so long as the Court deems it fair, reasonable, and adequate pursuant to Rule 23 of the Federal Rules of Civil Procedure. Consequently, the threshold issue now before the Court is whether the Settlement Agreement satisfies Rule 23.
On November 18, 2009, the Court issued an order certifying the Settlement Class pursuant Rule 23(b)(3) of the Federal Rules of Civil Procedure,
2
preliminarily approving the Settlement Agreement, and approving procedures and forms relating to notice to class members, objections to the Settlement Agreement, and final approval. (Doc. 170.) As a result, the Court set the stage for the final act in this longstanding litigation — i.e., the Motion for Final Approval and consideration of Class Counsel’s Fee Petition. The Plaintiffs provide a detailed and accurate history of the case leading up to this final act in their memorandum in support of .final approval (Doc. 175 at 1-11
3
). The Court’s summary of the case history below is based primarily on the Plaintiffs’ detailed description in their briefs; the Court expressly incorporates that description into this Opinion & Order. Because, however, the Court’s ruling with respect to the Motion for Final Approval and the Fee Petition is largely fact-specific, especially with respect to Class Counsel’s conduct in pursuing their case, it is necessary to include some of the important details in the history of the case set forth below.
A. THE PLAYERS
For the sake of clarity, the following is a brief introduction to the key players in this litigation and the parties to the Settlement Agreement.
1. The Named Plaintiffs/Class Representatives
The named plaintiffs serve as class representatives for the class defined by the Settlement Agreement. As stated in the Court’s November 18, 2009 Opinion & Order, “Paul Lonardo, Dante Frezza, and Joe Feldman are hereby appointed as the Settlement Class Representatives.” (Doc. 170 at 4.)
4
The Court will refer to Lonardo,
*772
Frezza, and Feldman as “the Settlement Class Representatives” throughout this Opinion & Order. The Court will refer to the named plaintiffs and class representatives and the class they represented in the pre-settlement lawsuit as “the Plaintiffs.”
2. The Defendants
The named defendants in this case are: The Travelers Property Casualty Insurance Company, The Standard Fire Insurance Company, and The Travelers Indemnity Company. In addition, the following entities are
not
themselves named defendants, but are affiliated with the named defendants and signed-on to the Settlement Agreement: The Automobile Insurance Company of Hartford, CT, Travelers Property Casualty Insurance Company, Travelers Property Casualty Company of Illinois, The Phoenix Insurance Company, The Travelers Indemnity Company of Connecticut, and The Travelers Companies, Inc. For the sake of simplicity, all of these affiliated entities will be referred to throughout this Opinion & Order as “Travelers” or the “Settling Defendants,” or, where appropriate, the “Named Defendants.”
3. The Settlement Class
The definition of the class, as initially certified, is set forth in the Court’s January 26, 2009 Opinion & Order, 259 F.R.D. 294, 300 (N.D.Ohio 2009). For settlement purposes, however, the parties agreed to the following definition of the “Settlement Class:”
“Class” or “Settlement Class” means, for settlement purposes only and for no other purpose: All persons in the United States who made an initial purchase of a homeowners insurance Class Policy (as that term is defined elsewhere) from a Settling Defendant for a property located in the states of Alabama, Arkansas, Colorado, Illinois, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, Ohio, South Carolina, and Tennessee, who are eligible to purchase Travelers homeowners insurance offering identical coverage and service, at a lower price, during the relevant “Class Period” for each respective state as set forth below. The precise “Class Policies” include only the policies described for the relevant time periods listed for each state in Exhibit B.... Excluded from the Class is any Class member who timely elects to be excluded from the Settlement Class, and all present and former agents of Defendants during the Class Period; all present and former employees of Defendants during the Class Period; and all members of the judiciary of the Court, and all members of their immediate families.
(Doc. 168 at 2-3 (omitting footnote).)
5
The Court certified the Settlement Class for settlement purposes in its November 18, 2009 Opinion
&
Order. (Doc. 170.)
4. Class Counsel
The Court appointed counsel for the Settlement Class in the November 18, 2009 Opinion
&
Order. (Doc. 170 at 4.) The Court appointed:
Don Barrett, Barrett Law Office, P.A.; Charles F. Barrett, Barrett
&
Associates, P.A.; Dewitt M. Lovelace, Lovelace Law Firm; R. Eric Kennedy and Daniel P. Goetz, Weisman, Kennedy & Berris Co., L.P.A.; Elizabeth J. Cabraser and Jahan C. Sagafi, Lieff, Cabraser, Heimann & Bernstein, LLP; John R. Patchett, Patchett Law Office;
*773
Thomas Thrash, Thrash Law Firm, and Pierce Gore, Gore Law Firm.
(Doc. 168 at 3.) Each of these attorneys and/or their law firms have submitted an affidavit in support of their Fee Petition. (Doc. 176, Exs. A-G.)
5. The Objectors
Nine objections were asserted in response to the notice of the Settlement Agreement.
6
Class member Daniel Green-berg’s objection (Doc. 173) encompasses the substantive and colorable arguments asserted in all of the other objections. Mr. Greenberg is represented by attorney Theodore H. Frank of the non-profit law firm The Center for Class Action Fairness. Mr. Frank filed a brief on behalf of Mr. Greenberg articulating his objections to the Settlement Agreement.
(Id.)
He also appeared at the Final Fairness Hearing and presented oral argument in support of Mr. Greenberg’s objections. (Tr. of Final Fairness Hrg., Doc. 188 at 37-57.)
B. THE UNDERLYING LITIGATION
While the claims at the heart of this litigation are rather nuanced, the Plaintiffs essentially allege that Travelers sells identical homeowners insurance policies at multiple prices, concealing the availability of lower-priced policies that offer identical coverage and service to identically qualified customers. The Plaintiffs allege that Travelers’ practice of charging multiple prices for identical coverage of the exact same risk constituted, among other things, fraudulent concealment and unjust enriehment. The Plaintiffs’ ease evolved in three progressive stages, each of which is identifiable by the named plaintiff.
1. The
Zangara
Case
The first case in the trilogy was
Vincent Zangara, et al. v. Travelers Indemnity Company of America,
Case No. 1:05cv731 (N.D.Ohio) (O’Malley, J.), which Class Counsel filed on March 14, 2005. The
Zangara
complaint alleged that a Travelers affiliate sold the plaintiffs a “homeowners insurance policy without disclosing to them the availability of a less expensive Travelers homeowners policy offering identical coverage and policyholder service.”
Zangara,
Case No. 1:05cv731, Doc. 2, ¶ 12. A year later, after substantial discovery and briefing regarding a motion to dismiss filed by Travelers and regarding class certification, Class Counsel filed a motion to amend the complaint indicating that the named plaintiff likely had purchased the lower-priced policy.
Id.
at Docs. 56, 56-1, 72. Although on March 16, 2006, the Court denied Travelers’ initial motion to dismiss, on March 30, 2006, the Court granted Travelers’ second motion to dismiss, this time for lack of subject matter jurisdiction. In the same order, the Court granted Travelers’ motion to vacate all prior orders.
Id.
at Docs. 58, 60-62.
2. The
Stanich
Complaint
Less than a month after the Court dismissed
Zangara,
the next iteration of the case was filed on April 19, 2006, under the current case number, as
Neil Stanich et al. v. Travelers Property Casualty Insurance Company et al.,
Case No. 06cv962
*774
(N.D.Ohio) (O’Malley, J.). The
Stanich
complaint was similar to the
Zangara
complaint, but with new class representatives, and a new legal theory regarding Travelers’ alleged duty to disclose the existence of lower-priced policies.
(See
249 F.R.D. at 514.) Contentious and extensive discovery ensued, and the Court asked Magistrate Judge Patricia Hemann to assist in the supervision of discovery. On April 20, 2007, the Plaintiffs filed their motion for class certification. (Doc. 107.) After the parties fully briefed the motion for class certification, the Court held a two-day hearing which included testimony by eight live witnesses. (Docs. 124-25.) Subsequently, the parties filed supplemental briefs. (Docs. 122,126.)
On March 28, 2008, the Court issued a lengthy opinion and order regarding class certification. 249 F.R.D. 506 (N.D.Ohio 2008). In the March 28, 2008 Opinion
&
Order, the Court held that the class was certifiable, but deferred its final ruling because the named plaintiffs designated to serve as representatives for the Agent Subclass, Neil and Bobby Jean Stanich, failed to meet the adequacy and typicality requirements of Rules 23(a)(3) and (a)(4) of the Federal Rules of Civil Procedure. ( 249 F.R.D. at 530 .) The Court gave the Plaintiffs time to conduct discovery and then move to substitute a new Agent SubClass representative.
(Id.)
3. The
Lonardo
Complaint
The third stage of the case began on July 24, 2008, when the Plaintiffs filed their motion to amend the complaint to substitute Paul Lonardo as Agent SubClass representative. (Doc. 132.) Once again, the parties briefed this motion and related motions extensively. On January 26, 2009 the Court issued another lengthy opinion and order granting the motion to amend the complaint to substitute Lonardo, appointing class counsel, and certifying the class. ( 259 F.R.D. 294 .)
Travelers appealed the January 26, 2009 Opinion
&
Order to the United States Court of Appeals for the Sixth Circuit. After further briefing, the Sixth Circuit affirmed the January 26, 2009 Opinion & Order on April 24, 2009.
(See
Doc. 175 at 6.)
The Court then held a pre-trial conference to establish a new case schedule regarding discovery and notice procedures and forms. On April 9, 2009, the Court inquired as to whether the parties wished to mediate. Throughout the Spring and Summer of 2009, the Court conducted several status hearings and conferences to address issues relating to discovery, notice, and the exact parameters of the class certified. In the course of working through issues during that time, the parties began to discuss settlement.
C. THE SETTLEMENT AGREEMENT
1. Settlement Negotiations
Class Counsel described the settlement process as follows: “Settlement negotiations were protracted, difficult, and certainly at arm’s length.” (Doc. 175 at 7.) At the hearing, Travelers’ counsel concurred in this description of the parties’ interaction. (Tr. Fairness Hrg., Doc. 188.) The parties initially participated in telephone conferences, and then met in person several times in the Summer of 2009, all the while exchanging information. The parties finally reached a settlement on September 17,2009.
(Id.)
2. Terms of the Settlement
The terms of the settlement are set forth in the Settlement Agreement. (Docs. 168, 190.) In addition to the definitions of the Settlement Class, Class Counsel, and the Settlement Class Representatives provided above, there are several other key provisions of the Settlement Agreement.
*775
a. Cash Payment and Recovery Calculations
The Settlement Agreement provides that each class member who timely submits a properly completed claim form is entitled to $8.69 for each 12-month Class Policy Period.
7
(Doc. 168 at 15, ¶ II.E.l.) This figure is based on the following undisputed calculations:
8
• Travelers identified 2,064,866.88 Class Policy Periods at issue,
9
and the Claims Administrator identified 487,277 potential Settlement Class Members. (Oseas Decl., Doc. 174-1 at 1.)
• Settlement Class Members paid a total of $89,273,821 in additional commission charges due to the price difference between the identical policies at issue. (Tr. Fairness Hrg., Doc. 188 at 10; Decl. of Leonard R. Freifelder, Ph.D. (“Freifelder Decl.”), Doc. 176 Ex. Y at 3.)
• Because there are 2,064,866.88 Class Policy Periods and 487,277 potential Settlement Class Members, the average overpayment per Class Policy Period was $43.235.
(Id.)
Thus, the $8.69 cash payment per class period represents a 20 percent recovery. (Tr. Fairness Hrg., Doc. 188 at 10.)
10
• The average Settlement Class member will be compensated for approximately 4.24 Class Policy Periods, and, in total, will receive approximately $36.82 from the cash payment aspect of the Settlement Agreement. (Freifelder Decl., Doc. 176 Ex. Y at 3; Tr. Fairness Hrg., Doc. 188 at 10-11.)
In addition, each Settlement Class Member who submits a timely and valid claim form is entitled to a pro rata share of the $2 million Reversion from the attorneys’ fee provisions of the Settlement Agreement, as discussed below in the section regarding the Available Benefit.
(See
Doc. 190-1 at 1.)
b. Notice and Claims Administration Costs
The Settlement Agreement provides that Travelers will pay for all costs associated with providing and administering the notice and claims procedures. (Doc. 168 at 16-17, ¶ II.F.2.) The Claims Administrator estimates that, as of January 23, 2010, these costs totaled $420,306.
11
(Oseas
*776
Decl., Doc. 174-1 at 1.)
c. Attorneys Fees
The original Settlement Agreement permitted Class Counsel to apply for attorneys’ fees in an amount
not to exceed
$6.6 million. (Doc. 168 at 16, ¶ II.F.2.) Paragraph II.F.2 provides:
Class Counsel shall apply to the Court for an award of attorneys’ fees and reimbursement of expenses, which award shall be contingent on approval of the Settlement by the Court. Application by Class Counsel for an award of attorneys’ fees and expenses shall not be in excess of $6,600,000.00. Defendants will not oppose the motion for approval of attorneys’ fees provided it is made in conformity with this paragraph. The attorneys’ fees and reimbursement of expenses, as awarded by the Court, shall be paid by the Defendants, without depleting the settlement payments to be made to the Settlement Class members. Defendants shall pay Class Counsel the amount of attorneys’ fees and expenses, not exceeding $6,600,000.00, that are ultimately approved by the Court within 14 days after the Effective Date of this Settlement Agreement.
(Id.)
The First Amendment to the Settlement Agreement changed this provision (¶ II.F.2) by reducing the maximum amount of attorneys’ fees from $6.6 million to $4.6 million and awarding the $2 million difference to the Settlement Class, to be distributed on a pro rata basis. (Doc. 190-1 at 1.) The parties and Mr. Frank refer to this $2 million payment to the Settlement Class as the “Reversion;” the Court will use the same moniker. The First Amendment replaces all instances of $6.6 million with $4.6 million and adds the following paragraph to the end of the original paragraph II.F.2:
The Settling Defendants will pay to the Settlement Class an additional $2,000,000.00 (the “Reversion”), and in exchange Class Counsel has agreed to seek only up to $4.6 million ($4,600,-000.00) in attorneys’ fees and costs. Nothing in this Agreement obligates the Settling Defendants to pay more than $4,600,000.00 in attorneys’ fees and costs. This Reversion to the Settlement Class shall be distributed, pro-rata per class policy period, among Class members who submit a timely and valid Claim Form postmarked on or before February 17, 2010. To the extent the Court requires any additional notice to the Class, the cost of such notice will be borne by Class Counsel.
(Doc. 190-1 at 1.)
d. Injunctive Relief
Travelers also agreed not to engage in the practice at issue, as defined in the Settlement Agreement, for a period of three years. (Doc. 168 at 17, ¶ II.G.)
3. Preliminary Approval & Notice
On November 18, 2009, the Court issued an order preliminarily approving the Settlement Agreement and approving procedures and forms relating to notice to class members, objections to the Settlement Agreement and final approval. (“Preliminary Approval Order,” Doc. 170.) The Preliminary Approval Order established deadlines and procedures for notice to the Settlement Class, claims, and objections.
(Id.)
The Court scheduled the Final Fairness Hearing for January 27, 2010.
(Id.
at 3.)
Notice proceeded in the manner described in the Settlement Agreement and Preliminary Approval Order.
(See
Doc. 175.) The Claims Administrator, Epiq Systems, Inc., received from Travelers contact information for 487,277 potential class members. The Claims Administrator processed these names and addresses to identify any changes-of-address and then implemented a direct mail notice program. In addition, the Claims Administrator is
*777
sued a public notice, established an informational website (http://www.lonardo settlement.com), and established a toll-free telephone number for the litigation.
At the Final Fairness Hearing on January 27, 2010, the parties agreed to the Court’s proposal to allow further briefing after the close of the claims period — February 17, 2010 — regarding the fairness of the Settlement Agreement (and attorneys’ fees). (Docs. 187, 188.) The Court established a schedule for such briefing, and ordered Travelers to post information regarding the number of timely and valid claims filed with the Claims Administrator on the website on or before March 1, 2010. (Doc. 187.)
4. Claims Submitted and Actual Payment to the Settlement Class
The deadline for submitting claims was February 17, 2010. (Doc. 170 at 3.) As of February 25, 2010, the Claims Administrator had received 53,782 timely, valid claims.
(See
http://www.lonardo settlement.com, last visited March 26, 2010.)
12
Pursuant to the Court’s order at the close of the Final Fairness Hearing on January 27, 2010, Travelers disclosed on February 27, 2010, that the total amount of these claims was $2,812,962. (Doc. 191.) In other words, $2,812,962 is the total cash payment the Settlement Class will receive on a per Class Policy Period basis as the product of $8.69 and the number of Class Policy Periods encompassed within the timely and valid claims submitted. In addition to this amount, the Settlement Class will actually receive a cash payment of $2 million dollars as a result of the Reversion. This Reversion will increase the actual cash payment by approximately $6.18 per Class Policy Period, based on the number of timely and valid claim forms submitted. The Court will refer to this amount— $2,812,962 plus the $2 million Reversion— as the “Actual Payment” throughout this Opinion and Order.
5. The Available Benefit
Travelers and the Plaintiffs agree that, notwithstanding the amount of the Actual Payment, the amount available to the Settlement Class equals the product of potential Settlement Class Members’ Class Policy Periods (2,064, 866.88) and the agreed cash payment per Class Policy Period ($8.69). This amounts to $17,943,693.18.
(See
Freifelder Decl., Doc. 176 Ex. Y at 4; Tr. Fairness Hrg., Doc. 188 at 10.) In other words, if every potential Settlement Class Member identified by Travelers had submitted a timely, valid claim form, the Actual Payment to the Settlement Class would have been $17,943,693.18. The Court will refer to this amount — $17,943,-693.18 — as the “Available Benefit.”
13
*778
In order to fully understand the Available Benefit in context, at the Final Fairness Hearing the Court asked the parties to clarify the relationship between the Available Benefit they negotiated as part of the Settlement Agreement (i.e., the $8.69 payment per Class Policy Period) and Settlement Class Members’ actual loss as a result of paying the higher premium. (Tr. Fairness Hrg., Doc. 188 at 10-11.) Referring to the Freifelder Declaration, the parties indicated that the Settlement Class Members’ actual loss is approximately $89 million. This estimate is based on Dr. Freifelder’s calculation: 2,064,866.88 Class Policy Periods multiplied by an average overcharge per Class Policy Period of $43,235 equals $89,273,821.
14
(Freifelder Deck, Doc. 176 Ex. Y at 3.) Therefore, as noted by the Court at the Final Fairness Hearing, the Available Benefit negotiated by the parties as set forth in the Settlement Agreement represents a 20 percent recovery of the Settlement Class’ Total Actual Loss. (Tr. Fairness Hrg., Doc. 188 at 10.)
II.
CLASS ACTION SETTLEMENT APPROVAL ANALYSIS
Having described the background of this litigation and summarized the key aspects of the Settlement Agreement, the Court now turns to the approval analysis.
A. APPLICABLE STANDARD FOR APPROVAL OF CLASS ACTION SETTLEMENT
It is well-established that the law generally favors settlement.
See, e.g., Enter. Energy Corp. v. Columbia Gas Transmission Corp.,
137 F.R.D. 240, 246 (S.D.Ohio 1991) (“The law generally favors and encourages the settlement of a class action.”). “The Court evaluates the proposed settlement in light of the general federal policy favoring settlement of class actions.”
UAW v. General Motors Corp.,
Case No. 05cv73991-DT, 2006 WL 891151 , at *12 (E.D.Mich. Mar. 31, 2006). Rule 23, moreover, requires that a class action settlement be “fair, reasonable, and adequate.” Fed.R.Civ.P. 23(e)(2);
see also United States v. Jones & Laughlin Steel Corp.,
804 F.2d 348, 351 (6th Cir.1986). Whether a class action settlement satisfies Rule 23(e) is committed to the sound discretion of the district court.
See Bailey v. Great Lakes Canning, Inc.,
908 F.2d 38, 42 (6th Cir.1990).
Although Rule 23 does not prescribe a procedure for determining whether a proposed class action settlement is fair, reasonable, and adequate, it does require the Court to provide class members who would be bound by the proposed settlement with reasonable notice and an opportunity to object. Fed.R.Civ.P. 23(e). The Court must also hold a hearing regarding the fairness, reasonableness, and adequacy of the proposed settlement.
Id.; see also Tenn. Ass’n of Health Maint. Orgs., Inc. v. Grier,
262 F.3d 559, 567 (6th Cir.2001) (quoting
United States v. Oregon,
913 F.2d 576, 582 (9th Cir.1990) noting that the district court may conduct the fairness hearing in the manner appropriate “to aid it in reaching an informed just and reasoned decision”). The Court has satisfied
*779
these preliminary requirements: in the Preliminary Approval Order (Doc. 170), the Court provided for notice and an opportunity to object to the Settlement Agreement, and the Court allowed Settlement Class Members to present objections at the Final Fairness Hearing on January 27, 2010 (Doc. 188). Therefore, the question now before the Court is simply whether the Settlement Agreement is fair, reasonable, and adequate.
Courts within the Sixth Circuit refer to a list of relevant factors to evaluate the fairness, reasonableness, and adequacy of a class action settlement.
See, e.g., Gordon v. Dadante,
336 Fed.Appx. 540, 549 (6th Cir.2009) (unpublished) (citing
Intl’ Union, United Auto., Aerospace, & Agric. Implement Workers v. Gen. Motors Corp.,
497 F.3d 615, 631-32 (6th Cir.2007) (listing seven factors for evaluating a class action settlement)). In
UAW v. GM,
2006 WL 891151 , at *14, the Eastern District of Michigan listed the following relevant factors:
(1) the likelihood of success on the merits weighed against the amount and form of the relief offered in the settlement;
(2) the risks, expense, and delay of further litigation;
(3) the judgment of experienced counsel who have competently evaluated the strength of their proofs;
(4) the amount of discovery completed and the character of the evidence uncovered;
(5) whether the settlement is fair to the unnamed Class members;
(6) objections raised by Class members;
(7) whether the settlement is the product of arm’s length negotiations as opposed to collusive bargaining; and
(8) whether the settlement is consistent with the public interest.
While Sixth Circuit courts do not always articulate these factors using this language,
see, e.g., Intl’ Union, United Auto., Aerospace, & Agric. Implement Workers,
497 F.3d at 631-32 (listing seven factors instead of eight), the above list includes the factors commonly recognized as relevant. The Court, moreover, “may choose to consider only those factors that are relevant to the settlement and may weigh particular factors according to the demands of the case.”
IUE-CWA v. General Motors Corp.,
238 F.R.D. 583, 594-95 (E.D.Mich.2006);
see also Granada Investments, Inc. v. DWG Corp.,
962 F.2d 1203, 1205-1206 (6th Cir.1992). Accordingly, the Court will evaluate the Settlement Agreement by addressing each of the relevant factors in turn, while recognizing that it need not give equal weight to each of those factors.
B. APPROVAL ANALYSIS
1. Whether the Settlement Agreement Is Fair, Reasonable, & Adequate
a. Likelihood of Success on the Merits
The first factor is the likelihood of success on the merits weighed against the amount and form of relief offered in the Settlement Agreement. A class action settlement may be particularly beneficial to the class if the risk of losing the case on the merits is high. As the Sixth Circuit has stated:
The fairness of each settlement turns in large part on the bona fides of the parties’ legal dispute. Although this inquiry understandably does not require us to “decide the merits of the case or resolve unsettled legal questions,” we cannot “judge the fairness of a proposed compromise” without “weighing the plaintiffs likelihood of success on the merits against the amount and form of the relief offered in the settlement.”
*780
Intl’ Union, United Auto., Aerospace, & Agric. Implement Workers,
497 F.3d at 631 (quoting
Carson v. Am. Brands, Inc.,
450 U.S. 79 , 88 n. 14, 101 S.Ct. 993 , 67 L.Ed.2d 59 (1981)).
The Plaintiffs’ legal position in this case has always been tenuous. The Court recognized in its initial class certification order that the Plaintiffs’ theory with respect to Travelers’ duty might make their claims vulnerable to dismissal at the summary judgment stage or to a finding in favor of Travelers at trial. ( 249 F.R.D. at 514 ; Tr. Fairness Hrg., Doc. 188 at 8.) Based on its own significant analysis of the legal questions central to this case, the Court also knows that the Plaintiffs’ legal theory is, as Class Counsel put it, “imaginative” and “unique.” (Tr. Fairness Hrg., Doc. 188 at 8.) Consequently, regardless of the outcome of summary judgement or trial, the Plaintiffs faced a very meaningful risk of losing on appeal to the Sixth Circuit. Travelers’ experienced counsel clearly understood the weaknesses in the Plaintiffs’ case, and consistently expressed their intention to exploit those weakness at each stage of the litigation. At the Final Fairness Hearing, the Court questioned Travelers’ counsel directly regarding her perspective on the Plaintiffs’ case. (Tr. Fairness Hrg., Doc. 188 at 35-36.) She confirmed that Travelers believed it had a substantial likelihood of prevailing on the merits:
Well, I mean, from my perspective, the legal theories ... of their case were not strong. I think ... the shifting of the theory from the fiduciary duty later to the reliance theory and so forth, they were revealing themselves some, recognition of the weakness of their legal theories in some respects.... If we ended up litigating, I felt that I had a strong case.
(Id.)
Accordingly, the Plaintiffs’ likelihood of success on the merits was decidedly speculative.
On the other side of the equation is the amount and form of the relief provided in the Settlement Agreement. With respect to the form of relief, the Settlement Agreement provides for a cash payment in the amount of $8.69 per Class Policy Period, a pro rata share of the $2 million Reversion, and an injunction prohibiting Travelers from engaging in the practice at issue, as defined in the Settlement Agreement, for a period of three years. As described above, the average Settlement Class Member overpaid by approximately $43 dollars per Class Policy Period, and the Settlement Agreement provides for a recovery of $8.69 per Class Policy Period. In terms of the amount, therefore, the parties negotiated a potential recovery equal to 20 percent of each Settlement Class Member’s Actual Loss. In addition, however, each Settlement Class Member will receive a pro rata share of the Reversion, thus increasing their recovery above 20 percent of their Actual Loss.
15
The injunctive relief is also significant given that the practice has a potential discriminatory effect.
(See
Declaration of Wilbur C. Leatherberry (“Leatherberry Deck”), Doc. 176 Ex. H (explaining how the practice could have a discriminatory effect).)
After balancing likelihood of success on the merits with the amount and form of the relief, the Court finds that this factor tips the scales heavily in favor of approval of the Settlement Agreement. The Settlement Agreement provides the Settlement Class Members with
something,
under cir
*781
cumstances in which there was a substantial likelihood that, but for the settlement, they would have received
nothing.
That “something,” moreover, is not just a nominal sum — it is a cash payment of, on average, in excess of $36. That amount far exceeds the value of the stamp and the effort required to return the claim form. Indeed, the cash component of the Settlement Agreement represents a meaningful recovery of almost one quarter of the Actual Loss, and does not include the value of enjoining a potentially discriminatory practice for at least three years.
b. Risks, Expense & Delay of Further Litigation
The second factor assesses the risks, expenses, and delay associated with further litigation.
See In re Telectronics Pacing Sys.,
137 F.Supp.2d 985, 1013 (S.D.Ohio 2001).
As discussed above, this was a hard-fought legal battle from the filing of the complaint in
Zangara
to the final settlement conference. As Class Counsel explained at the Final Fairness Hearing:
This litigation has gone on for nearly five years. Counsel for Plaintiffs have expended 7,000 hours, hundreds of interrogatories, hundreds of document requests, thousands of pages of documents have been produced, nineteen depositions, seven experts, two class certification proceedings, a trip to the Sixth Circuit on a 23(f), and probably a dozen or more formal or informal discovery hearings.
(Tr. Fairness Hrg., Doc. 188 at 6.) Based on the Court’s intimate knowledge of these proceedings, there is no reason to believe that either party would litigate the remainder of the case less vigorously. And, the remainder of the case would almost certainly include potentially meritorious summary judgment motions (and all of the associated briefing), as well as discovery in advance of summary judgment motions regarding the scope of the class, damages, and experts. Furthermore, appeal of any judgment would be a virtual certainty, adding years and costs to an already aged and expensive case.
In light of these considerations, the second factor also strongly favors approval,
c. Well-Informed Class Counsel Endorse the Settlement Agreement
The next factor favors approval if well-informed and knowledgeable counsel endorse the settlement.
See UAW v. GM,
2006 WL 891151 at *18 (stating that experienced counsel’s endorsement “is entitled to significant weight, and supports the fairness of the class settlement”);
Smith v. Ajax Magnethermic Corp.,
2007 WL 3355080 , at *5 (N.D.Ohio Nov. 7, 2007) (“The Sixth Circuit has held that, in the context of approving class action settlements, the Court ‘should defer to the judgment of experienced counsel who has competently evaluated the strength of his proofs.’ ”).
In this case, Class Counsel enthusiastically endorse the Settlement Agreement. (Tr. Fairness Hrg., Doc. 188 at 7 (“The fact that we are sitting here today and I am standing before you today with a settlement in place, frankly, is extraordinary.”).) Class Counsel are experienced and capable attorneys whose work in complex class actions and multi-district litigation matters is well-known to the Court.
See, e.g., In re Sulzer Hip Prosthesis and Knee Prosthesis Liab. Litig.,
268 F.Supp.2d 907 (N.D.Ohio 2003);
see also
Kennedy Aff., Doc. 175 Ex. E. In addition, the Court has already noted in the January 26, 2009 Opinion
&
Order that Class Counsel have devoted their time, resources, and expertise diligently to the task of prosecuting this action on behalf of the Plaintiffs and the Settlement Class. ( 259 F.R.D. at 319-20 .) For all of these
*782
reasons, the Court finds that the Settlement Agreement is endorsed by experienced, professional, and highly-skilled counsel who thoroughly evaluated the relative merits of the case and the Settlement Agreement.
16
d. Amount of Discovery Completed & the Character of the Evidence
In order to realistically and accurately assess the strength of their case and the propriety of settlement, experienced attorneys need sufficient information.
In
re
Telectronics,
137 F.Supp.2d at 1014 . With this in mind, another factor the Court considers in evaluating the Settlement Agreement is the amount and character of the evidence assembled to date.
Id.
Here, as described above, the parties have engaged in
substantial
discovery. (Tr. Fairness Hrg., Doc. 188 at 6.) First, the parties conducted significant discovery in preparation for the motion for class certification, and the Court heard live testimony from eight witnesses at the class certification hearing. (See Transcript of Class Certification Hearing (“Tr. Class Cert. Hrg.”), Docs. 124, 125.) Although the class certification process is not designed to test the merits of the plaintiffs’ claims, the Court noted in its class certification orders that, in this case, there was significant overlap between certain merit-based issues and certification, especially the basis for the Plaintiffs’ fraud allegations. ( 249 F.R.D. at 511, 514-21 .) Consequently, the nature of this case afforded counsel for both parties with an opportunity for early discovery regarding the merits. Second, the parties conducted more discovery in the context of identifying substitute class representative Lonardo. ( 259 F.R.D. 294 .) Third, after the Court issued the January 26, 2009 Opinion & Order regarding class certification, the parties conducted further discovery, including, among other things, discovery regarding the size and scope of the class certified. (See Doc. 175 at 6-7.) Ultimately, Class Counsel devoted more than 7,700 hours to this litigation and, as a result, have no doubt developed a sense of the relationship between the facts revealed in discovery and the legal issues.
Accordingly, the Court finds that this factor also strongly favors approval of the Settlement Agreement.
e. The Public Interest
Whether the Settlement Agreement serves the public interest is another relevant factor. Class actions are meant to serve the public interest by providing an incentive for lawyers and class representatives to litigate on behalf of a group of people whose injury is legitimate and meaningful, but whose individual damages are not substantial enough to make litigation on an individual basis worthwhile. Similarly, the law favors settlement of class actions for policy reasons. This case is consistent with the goals and policies underlying class actions. Class counsel took on a difficult case that an individual class member would almost certainly never file on their own. The Settlement Class, moreover, obtained recovery on a class-wide basis for an alleged injury that, but for this litigation, would almost certainly have gone uncompensated. In addition, the Settlement Agreement contains injunctive relief that, for at least three years, will prevent the potential discrimination Professor Leatherberry identified, a benefit to the public as well as Settlement Class Members. Accordingly, this Settlement Agreement is consistent with the public interest.
*783
f. Objections from Class Members
The remaining factors — whether the Settlement Agreement is the product of arms-length negotiations as opposed to collusive bargaining and whether the Settlement Agreement is fair to the unnamed class members — are encompassed within the Court’s analysis of the factors regarding objections from Settlement Class Members and will be addressed as such.
i. The Number of Objections
First, “[i]f only a small number of objections are received, that fact can be viewed as indicative of the adequacy of the settlement.”
Wal-Mart Stores, Inc. v. Visa U.S.A., Inc.,
396 F.3d 96, 118 (2d Cir.2005). The small number of objections is at least some indication that the settlement is fair to the unnamed class members. Here, the Claims Administrator sent the notice and claims forms to 487,277 potential Settlement Class Members and only ninety opted-out of the Settlement Agreement and nine submitted objections. Of those objections, one was untimely and was withdrawn because the objector was not a member of the class, one was submitted improperly, and several did not address issues within the scope of the Settlement Agreement. While the Court acknowledged that it may be possible to argue, and Mr. Greenberg did argue, that the paucity of objections is at least partially due to the procedures for submitting a claim and asserting an objection,
see
Tr. Fairness Hrg., Doc. 188 at 54-55, nine objections is truly a small number relative to the number of potential Settlement Class Members.
See Hainey v. Parrott,
617 F.Supp.2d 668, 675 (S.D.Ohio 2007) (stating that “a small number of objections, particularly in a class of this size, indicates that the settlement is fair, reasonable, and adequate”).
ii. The Substance of the Objections
Turning to the substance of the objections, the Court finds that Class Counsel has addressed each persuasively.
Before addressing the objections, however, it is important to note that, in his Supplemental Brief in Support of Objection of Daniel Greenberg (Doc. 191), Mr. Greenberg concedes that the Court could find that this Settlement Agreement is fair, reasonable, and adequate based on applicable Sixth Circuit authority:
Greenberg acknowledges that the Sixth Circuit grants discretion to a district court’s decision whether to approve a settlement as fair, reasonable, and adequate under Fed.R.Civ.P. 23(e), and further concedes that this court could arguably approve the settlement and fee proposal without committing an abuse of discretion under current case law — • though he certainly reserves his right to ask the Sixth Circuit to change that case law.
(Id.
at 1 (citing
Bailey,
908 F.2d at 42 ;
In re Sulzer Orthopedics, Inc.,
398 F.3d 778 (6th Cir.2005)).) In other words, while his objections seek to
improve
the Settlement Agreement, they do not assert that it is unfair, inadequate, or unreasonable under applicable law. Since that is the standard the Court must apply in order to approve the Settlement Agreement, the Court could conceivably grant the Motion for Final Approval (in the interest of judicial efficiency) without addressing Greenberg’s objections. The Court will not, however, take that approach, preferring instead to address all substantive objections presented to it in class action matters.
Insufficient Notice
In his objection and at the Final Fairness Hearing, Greenberg argued that the Settlement Agreement did not provide Settlement Class Members with sufficient
*784
notice regarding the total Available Benefit to the Settlement Class and the basis of Class Counsel’s request for $6.6 million in attorneys’ fees. (Doc. 173.) In response, Class Counsel directed the Court to the aspects of the Settlement Agreement estimating the number of Class Policy Periods at issue, describing the $8.69 cash payment per Class Policy Period, and explaining the parties’ agreement with respect to Class Counsel’s request for attorneys’ fees. (Tr. Fairness Hrg., Doc. 188 at 22-25.) Class Counsel argues that notice was sufficient because the Settlement Agreement was posted on the ease website and available on the Court’s docket. Class Counsel also cited several cases in which the notice regarding the total settlement fund and attorneys’ fees was less specific than the notice provided here.
(See
Tr. Fairness Hrg., Doc. 188 at 23-25 (citing,
e.g., Bobbitt v. Academy of Court Reporting, Inc.,
2009 WL 3336085 (E.D.Mich. Oct. 15, 2009)).)
Under the circumstances, and based on all of the facts described above, the Court finds that notice regarding the total Available Benefit and the basis of Class Counsel’s request for attorneys’ fees was sufficient to satisfy due process.
Greenberg also argues that notice was insufficient because Class Counsel filed the Fee Petition after the period to object to the Settlement Agreement had expired. While this is factually correct, the Court resolved this objection at the Final Fairness Hearing by expressly permitting supplemental briefing regarding approval and attorneys’ fees after the claims period ended on February 17, 2010. (Doc. 187.) At the Final Fairness Hearing, Mr. Frank acknowledged that this objection was “cured by the opportunity for further briefing.” (Tr. Fairness Hrg., Doc. 188 at 54.)
Artificial Barriers to Recovery
Mr. Greenberg objects to the Settlement Agreement on the grounds that the procedure for submitting claims erects artificial barriers to recovery by reducing the likelihood that Settlement Class Members will submit a timely, valid claim form.
First, he objects to the existence of a claim form — i.e., the fact that Settlement Class Members have to
opt-in
by signing and returning a form. He argues that the form is unnecessary because it does not provide Travelers with any information they do not already have. Instead, he proposes, Travelers simply should have written each Settlement Class Member it identified a check in the appropriate amount, or, alternatively, allowed Settlement Class Members to submit their claims online. In response, Class Counsel argued that the claim form and opt-in procedure are negotiated components of the settlement that Travelers insisted upon in order to force Settlement Class Members to affirm that they would have purchased a lower-priced policy had it been offered to them. As stated in the memo in support of final approval: “this Court certified the Ohio fraud class based upon the presumption of reliance. The claim form allows the Defendants the opportunity, on an individual basis, to attempt to rebut this presumption.” (Doc. 175 at 19.) While Mr. Greenberg contends in his supplemental brief that the Defendants are estopped from rebutting this presumption because of the uniform pattern of conduct underpinning the class certification order, the uniform conduct at issue was the form application, policy, and marketing documents. Given that fact, rebutting the presumption of reliance on an individual basis is not inconsistent with class certification.
See Baughman v. State Farm Mut. Auto. Ins. Co.,
88 Ohio St.3d 480 , 727 N.E.2d 1265, 1275 (2000) (holding that the defen
*785
dants may rebut the presumption of reliance on an individual class member basis). Furthermore, although it might have been better to allow Settlement Class Members the option to submit claims online, it was not unreasonable for defendants to insist on a uniform class procedure. Clearly, a mandate that claims be
only
submitted online would be subject to objection from those not sufficiently computer savvy to participate easily in the process. Choosing one claims processing mechanism that involves simple use of the mails is not unreasonable. The settlement must be reasonable and adequate, not perfect.
Attorneys’ Fees
Mr. Greenberg’s next objection asserts that the Court should reject the Settlement Agreement because the attorneys’ fees provisions were negotiated separately and are not included in the settlement amount available for the class. He argues that the Court should create “a bright-line rule forbidding attorneys from negotiating separate fee awards that do not benefit the class.” (Doc. 191 at 1-2.) In other words, the Court should refuse to approve
any
class action settlement in which attorneys’ fees are paid independently of the value of benefits bestowed upon the class. Mr. Greenberg argues that such an arrangement reduces the amount the class recovers because it divorces or “decouples” Class Counsel’s interests from the interests of the class and provides attorneys an incentive to reserve for themselves a larger percentage of the total funds the defendant is willing to pay. Mr. Greenberg goes so far as to argue that by setting up two separate funds — one for class payments and one for a potential fee award— Class Counsel “have breached their fiduciary duty to the class” and have not “fairly and adequately” represented the interests of the Settlement Class. (Doc. 173 at 8.) Finally, Mr. Greenberg asserts that use of this two part structure “reduces the court’s incentive to carefully scrutinize the fee for unreasonableness, since any reduction only benefits the defendant.” (Doc. 191 at 3.)
Class Counsel correctly point out that Mr. Greenberg’s brief is “long on ideology and short on law[,]” and that “[h]e readily admits that this Settlement could be approved under current Sixth Circuit law.” (Doc. 193 at 1.) More specifically, Class Counsel note, with substantial citation to case law, that the structure proposed in this case is common in class action litigation, that Mr. Greenberg has failed to cite a single case (and the Court has found none) where a class action settlement has been rejected on these grounds, and that the Sixth Circuit case law authorizes use of such a structure.
Class Counsel argues, moreover, that there will always be some conflict between the interests of the class and those of class counsel, which is why the Court is charged with reviewing the settlement to ensure that it is fair and that Class Counsel did not sacrifice the well-being of the Settlement Class for their own benefit. Class Counsel explains that any competent class action lawyer in 2010 understands that there is a split of authority and that a court might choose to award fees strictly as a percentage of the actual recovery to the class — i.e., the Actual Payment — giving counsel every incentive to maximize that Actual Payment. Class Counsel also notes that the history of this case clearly indicates that the parties negotiated at arm’s length and there is no evidence of collusion.
17
*786
While policy concerns often prompt commentators to rethink how class action settlements operate, Class Counsel’ arguments on this issue are both legally and factually more sound than those of Mr. Greenberg.
18
There is no legal authority supporting the bright line rule Mr. Green-berg asks the Court to draw and there is substantial case law indicating that it is neither necessary nor appropriate. There is also no reason to believe that Mr. Greenberg’s lack of faith in judicial officers who oversee class action settlements is justified. The notion that courts would be less vigilant regarding the propriety of an attorney fee award simply because of the structure it takes is confounding.
19
Courts are charged with carefully assessing the scope and size of any fee award, which this Court intends to do. Finally, on the facts of this case, there is nothing to indicate that collusion occurred between the parties on this issue; indeed, all evidence supports the opposite conclusion.
For these reasons, the Court rejects this final objection to the Settlement Agreement as well.
g. Conclusion: The Factors Favor Approval
For all of the reasons discussed above, the Court finds that the relevant factors favor approval of the Settlement Agreement. Accordingly, the Court GRANTS Plaintiffs’ Motion for Final Approval of Class Action Settlement and Incentive Award to Class Representatives (Doc. 175), APPROVES the Settlement Agreement as fair, reasonable, and adequate, and ORDERS Travelers to implement the “Equitable Relief’ provisions of the Settlement Agreement, and to fulfill all other obligations under the Settlement Agreement.
*787
2. Incentive Awards to Class Action Representatives
The Sixth Circuit has held that incentive awards to class representatives may be appropriate in some cases, but has not defined the circumstances justifying incentive awards.
See Hadix v. Johnson,
322 F.3d 895, 898 (6th Cir.2003). Courts within the Sixth Circuit, however, recognize that, in common fund cases and where the settlement agreement provides for incentive awards, class representatives who have had extensive involvement in a class action litigation deserve compensation above and beyond amounts to which they are entitled to by virtue of class membership alone.
Id.
(“Incentive awards are typically awards to class representatives for their often extensive involvement with a lawsuit. Numerous courts have authorized incentive awards.”);
Liberte Capital Group v. Capwill,
2007 WL 2492461 , *1-2 (N.D.Ohio Aug. 29, 2007).
The Settlement Agreement in this case expressly provides that Class Counsel will ask the Court to approve an incentive payment of $5,000 to each of the three Class Representatives — Lonardo, Frezza, and Feldman — “in recognition of [their] efforts on behalf of the Settlement Class.” (Doc. 168 at 17.) There are no objections to this provision of the Settlement Agreement, or to an incentive award in this case. The Class Representatives have actively participated in the case and assisted in its prosecution. Each submitted an affidavit describing his significant involvement in the case (Doc. 175 Exs. A, B, C), and the Court is well-aware of Lonardo and Frezza’s substantial contributions having observed Frezza testify at the class certification hearing (Doc. 124), and granted the Plaintiffs’ motion to substitute Lonardo as Class Representative ( 259 F.R.D. 294 ).
Accordingly, the Court GRANTS the request for an incentive award of $5,000 to each of the Class Representatives.
III.
FEE PETITION ANALYSIS
A. INTRODUCTION: CLASS COUNSELS’ PETITION FOR FEES
On January 25, 2010, Class Counsel filed their Fee Petition requesting an award of attorneys’ fees in the amount of $4.6 million. (Doc. 176.) Class Counsel suggested that this Court should evaluate the reasonableness of this request by employing the “lodestar” method and using the “percentage of the fund” method as a cross-check.
(Id.
at 1.) In addition, in light of acknowledged unsettled law in the area, Class Counsel proposed an innovative approach to determining the value of the “the fund” for purposes of the percentage of the fund analysis.
(Id.
at 23-29.)
Several Settlement Class Members, led by Mr. Greenberg, objected to the provision of the original settlement agreement (Doc. 168 at 16, ¶ II.F.2) in which the Defendants agreed not to oppose Class Counsel’s .request for attorneys’ fees, so long as they did not request more than $6.6 million. In their Fee Petition, which was filed after Mr. Greenberg filed his objection (Doc. 173), Class Counsel requested only $4.6 million in fees, and promised to amend the Settlement Agreement to reflect the $2 million reduction.
20
(Doc. 176 at 16.) Mr. Greenberg then appeared at the Final Fairness Hearing through his attorney, Mr. Frank of The Center for Class Action Fairness, and presented his objections to Class Counsel’s request for attorneys’ fees. The time period for potential Settlement Class Members to submit claims had not expired at the
*788
time of the Final Fairness Hearing, so the Court permitted post-hearing briefing regarding approval of the Motion for Final Approval and the Fee Petition
(see
Doc. 187). On March 9, 2010 Mr. Frank filed a supplemental brief in which he conceded that the Court could grant Class Counsel’s Fee Petition under applicable Sixth Circuit authority, but nonetheless continued to press Mr. Greenberg’s objections in an effort to persuade the Court to adopt his own proposals with respect to the proper analysis of fee petitions in class action cases. (Doc. 191 at 1.)
21
The debate between Mr. Frank (on behalf of Mr. Greenberg) and Class Counsel raises interesting questions of largely unsettled law. Both sides agree that (1) an inevitable conflict of interest exists between class counsel and the class in every class action settlement against which courts must guard; and (2) the Settlement Agreement in this case is
not actually
tainted by collusion between Class Counsel and Travelers or self-dealing by Class Counsel. Their disagreement concerns whether the Court should ever award attorneys’ fees in excess of a reasonable percentage of the Total Actual Payment to the class. The Court will address the issues that arise out of this disagreement in its analysis of the Fee Petition below.
B. APPLICABLE LAW: THE DETERMINATION OF ATTORNEYS’ FEE AWARDS IN CLASS ACTION CASES
Rule 23(e) requires the Court to evaluate all class action settlements. Fed. R.Civ.P. 23(e). One aspect of this responsibility is to protect absent class members’ interests; another is to ensure “that counsel is fairly compensated for the amount of work done as well as for results achieved.”
Rawlings v. Prudential-Bache Props., Inc.,
9 F.3d 513 , 516 (6th Cir.1993). The unique characteristics of class actions, both generally and on a case-by-case basis, give district courts broad discretion in their determination of an attorneys’ fee award.
See Bowling v. Pfizer, Inc.,
102 F.3d 777 , 779 (6th Cir.1996);
Rawlings,
9 F.3d at 516;
In re Cardinal Health Inc. Sec. Litigs.,
528 F.Supp.2d 752, 757 (S.D.Ohio 2007) (citing
In re Sulzer Orthopedics Inc.,
398 F.3d 778, 780 (6th Cir.2005) for the proposition that “[i]t is within the Court’s discretion to set the amount of attorneys’ fees so that they are reasonable, and the Sixth Circuit reviews such an award only for an abuse of discretion.”).
Courts usually employ one of two methods in analyzing a request for attorneys’ fees — the
“lodestar”
analysis or
“percentage of the fund”
analysis.
See, Sulzer,
268 F.Supp.2d at 922 (citing
Rawlings,
9 F.3d at 515-16);
see also In re Cardinal Health,
528 F.Supp.2d at 757 (“First, the Court must select a method by which to calculate the attorneys’ fees-either the percentage approach or the lodestar approach.”). To determine the
“lodestar”
figure, the Court multiplies the proven number of hours reasonably expended on the litigation by a reasonable hourly rate.
Reed v. Rhodes,
179 F.3d 453, 471 (6th Cir.1999);
see also Isabel v. City of Memphis,
404 F.3d 404, 415 (6th Cir.2005);
Sulzer,
268 F.Supp.2d at 922 (citing
Penn. v. Delaware Valley Citizens’ Council for Clean Air,
478 U.S. 546, 565 , 106 S.Ct.
*789
3088, 92 L.Ed.2d 439 (1986)). The Court may then adjust the lodestar figure up or down based on a number of factors designed to account for case-specific circumstances.
Id.
“In contrast, ‘[ujnder the percentage of the fund method, the court simply determines a percentage of the settlement to award the class counsel.’ ”
Sulzer,
268 F.Supp.2d at 922 (quoting
In re Telectronics Pacing Sys.,
137 F.Supp.2d 1029, 1041 (S.D.Ohio 2001) (citing
Rawlings,
9 F.3d at 516)).
In the Sixth Circuit, it is within the discretion of the district court to decide which method to use in a given case.
See id.
(quoting
Bowling,
102 F.3d at 779 (quoting
Rawlings,
9 F.3d at 516)). In
Rawlings,
the Sixth Circuit stated:
The lodestar method better accounts for the amount of work done, while the percentage of the fund method more accurately reflects the results achieved. For these reasons, it is necessary that district courts be permitted to select the more appropriate method for calculating attorney’s fees in light of the unique characteristics of class actions in general, and of the unique circumstances of the actual cases before them.
Rawlings,
9 F.3d at 516. In general, however, percentage of the fund has been the preferred method for common fund cases, where there is a single pool of money and each class member is entitled to a share (i.e., a “common fund”).
Id.
This is not a common fund case, however. The Settlement Agreement provides for attorneys’ fees independent of what the Available Benefit or the Actual Payment to the Settlement Class turns out to be. Class Counsel submits that the lodestar has been favored in statutory fee-shifting cases and in cases, like this one, in which the settlement agreement provides for attorneys’ fees to be paid independently (as opposed to from the common fund). (Doc. 176 at 13-14.) Class Counsel cites a number of cases in support of this proposition, although none are within the Sixth Circuit.
See Wing v. Asarco, Inc.,
114 F.3d 986 (9th Cir.1997);
Deloach v. Philip Morris Companies,
2003 WL 23094907 (M.D.N.C.2003);
Johnston v. Comerica Mortgage Corp.,
83 F.3d 241, 245-46 (8th Cir.1996);
Weinberger v. Great Northern Nekoosa Corp.,
925 F.2d 518, 524-27 (1st Cir.1991);
Lobatz v. W. Cellular of Cal., Inc.,
222 F.3d 1142 (9th Cir.2000).
For his part, Mr. Frank argues that there is no such thing as an attorneys’ fee that is independent of the common fund. Quoting
In re General Motors Corp. Pick-Up Truck Fuel Tank Prod. Liab. Litig.,
55 F.3d 768, 820-21 (3d Cir.1995) he contends that “although the parties claim that the fee and settlement are independent, they actually come from the same source[;] ... private agreements to structure artificially separate fee and settlement arrangements cannot transform what is in economic reality a common fund situation into a statutory fee shifting case.” (Doc. 173 at 9.) What independent fee arrangements do, either purposely or “subliminally,” he argues, is eliminate a potential source of funds for the class. (Doc. 191 at 3.) Mr. Frank explains that “[a]ny fee that a defendant agrees to pay directly to class counsel is an amount that it would have been willing to include as part of the payment to the class[,]” but, because it was negotiated independently it will revert back to the
defendant,
not the class, if the Court’s fee award is less than the amount requested or available strictly for fees. (Doc. 191 at 3-4.) With this “economic reality” in mind, Mr. Frank argues that the percentage of the fund methodology should be used in all cases. At the Final Fairness Hearing, he stated:
I certainly recognize that the Sixth Circuit currently leaves the question of the lodestar [versus] common fund percentage up to the Judge, but I would like to
*790
argue as a public policy matter that we should take a firm stand on the common fund percentage, and the Second Circuit is coming around to this position, holding that the percentage method, quote, “directly aligns the interests of the class and its counsel and provides a powerful incentive for the efficient prosecution and early resolution of litigation. In contrast, lodestar creates an unanticipated disincentive to early settlements, tempts lawyers to run up their hours, and compels district courts to engage in a gimlet eyed review of line item fee audits.”
(Doc. 188 at 50 (quoting
Wal-Mart Stores, Inc. v. Visa U.S.A., Inc.,
396 F.3d 96, 121 (2d Cir.2005)) (omitting internal citations and quotations).) Mr. Frank goes on to argue that, while cases within the Sixth Circuit and elsewhere continue to apply the lodestar, there is an trend toward his position:
I think if you look at what the Class Action Fairness Act says and you look at what the 2003 Advisory Committee Notes are and the new edition of the Manual for Complex Litigation and all of these which says, you know, sort of base the fees on the actual benefit to the class. And there just aren’t any recent cases that consider all three of these and then say let’s look at the lodestar. And there are definitely cases out there that apply the lower precedent and go with the lodestar. I would submit that these cases have failed to adequately change, consider the change in the law, and the change in direction, and think the trend is certainly toward a percentage, a common fund percentage for these public policy reasons, but I recognize that the Sixth Circuit puts that within your discretion.
(Id.
at 52.) Lastly, Mr. Frank contends that judicial efficiency militates against performing the lodestar analysis.
In response to Mr. Frank’s arguments, as discussed above, Class Counsel points out that he has cited no case law supportive of his position, let alone binding authority, and argues that his concerns are theoretical and unfounded. Class Counsel contends that, ultimately, courts have been given the responsibility of approving class action settlements and awarding fees in recognition of the inherent conflict of interest in class action litigation. Accordingly, Class Counsel argues, the courts should be afforded the discretion to evaluate a request for attorneys’ fees under the methodology most appropriate for the case, and the public should be entitled to rely on the courts’ ability and diligence in discharging this duty. (Doc. 193 at 2-3, 7.)
Both positions have some merit, but Mr. Frank’s perspective: (1) overstates the “trend” in the law regarding independent attorneys’ fee agreements and the Second Circuit’s preference for the percentage of the fund method; and (2) ignores one very important aspect of the Court’s supervisory role with respect to class action settlements — “that counsel is fairly compensated for amount of work done as well as for results achieved.”
See Rawlings,
9 F.3d at 516.
First, as noted above, the cases Mr. Frank cites in support of his proposal that independent attorneys’ fee agreements should be per se unfair merely stand for the proposition that the Court must review
all
aspects of a class action settlement agreement, including independent agreements between class counsel and the defendants regarding attorneys’ fees.
See Staton,
327 F.3d at 964 (holding that, regardless of the form of the attorneys’ fee provisions, the Court must review that aspect of a class action settlement agreement);
Lobatz,
222 F.3d at 1147 (holding that the attorneys’ fee award is part of the
*791
settlement and payable by the defendant regardless of the independence of the fund);
In re General Motors,
55 F.3d at 820-21 (holding that an independent agreement between class counsel and the defendants regarding attorneys’ fees must be reviewed along with the class action settlement);
Johnson,
83 F.3d 241 . These cases do
not
suggest that a settlement agreement is unfair, unreasonable, or inadequate simply because the defendants and class counsel negotiate an independent fund as the source of any attorneys’ fee award. Similarly, as discussed further below, even the
Wal-Mart
case Mr. Frank cites for the proposition that courts should not apply the lodestar analysis clearly indicates that the Court has discretion to use the lodestar method, percentage of the fund method, or the cross-check method.
Wal-Mart,
396 F.3d at 121 ;
see also Masters v. Wilhelmina Model Agency, Inc.,
473 F.3d 423, 436 (2d Cir.2007) (citing
Wal-Mart
for the proposition that which method to apply in a given case is clearly within the discretion of the district court).
Second, one of the fundamental principles of class action litigation is that it provides an incentive to pursue recovery for tortious conduct that would otherwise go unchecked because the individual harm to a potential plaintiff is too small to justify the cost of litigation. Collective action is the best, and, in many eases, the only feasible, way to redress the harm on an individual basis and discourage similar conduct in the future. Of course, class actions depend on class counsel — that is why the Court’s duty to ensure that class counsel is fairly compensated under the circumstances of the case is such an important part of the Court’s Rule 23(e) responsibilities. In many cases, Mr. Frank’s approach would result in fair compensation for class counsel. In other cases, his approach would significantly undervalue class counsel’s service to the class and to the public. Although the Court believes that this is such a case,
22
it need not address that question in detail because there is an alternative approach that is: (1) firmly rooted in Sixth Circuit authority; and (2) consistent with this Court’s understanding of its duty to
actually
scrutinize the Settlement Agreement and the basis of the request for attorneys’ fees. Specifically, as this Court explained in
Sulzer,
268 F.Supp.2d at 922 , a court may choose to use the lodestar method cross-checked by the percentage of the fund method in or
*792
der to reach an accurate and well-reasoned result.
See also Bowling,
102 F.3d at 779;
Fournier v. PFS Investments, Inc.,
997 F.Supp. 828, 831 (E.D.Mich.1998). Although this Court has expressly acknowledged that more effort is involved in employing both methods,
Sulzer,
268 F.Supp.2d at 923 , as the Sixth Circuit stated in
Rawlings,
9 F.3d at 516, “the lodestar method better accounts for the amount of work done, ... the percentage of the fund method more accurately reflects the results achieved.”
23
Some cases require a more thorough approach than others, and the Court cannot ignore this reality in the interest of “judicial efficiency.”
Cf. Devlin v. Transportation Communs. Int'l Union,
175 F.3d 121 , 130 (2d Cir.1999) (stating in the consolidation context that “efficiency cannot be permitted to prevail at the expense of justice”).
The
Wal-Mart
case that Mr. Frank cites, moreover, confirms that it is within the discretion
of
the court to employ either the lodestar or percentage of the fund method.
Wal-Mart,
396 F.3d at 121 (“Courts may award attorneys’ fees in common fund cases under either the “lodestar” method or the “percentage of the fund” method.”). While the Second Circuit in
Wal-Mart
also notes that “[t]he trend in this Circuit is toward the percentage method[,]” two years after
Wal-Mart
the Second Circuit was unequivocal regarding the Court’s discretionary authority to apply the lodestar method: “Of course, courts may continue to use the lodestar approach alone in calculating attorneys fees in common fund cases.”
Masters v. Wilhelmina Model Agency, Inc.,
473 F.3d 423, 436 (2d Cir.2007). In fact, contrary to Mr. Frank’s implicit suggestion that
WalMart
was the beginning of a trend, the
Masters
decision cites
Wal-Mart
for this proposition.
Id.
(citing
Wal-Mart,
396 F.3d at 121 ). Accordingly, it appears that, to the extent that there is a trend toward the percentage method, it has not eroded the more fundamental principle that the district court has the discretionary authority to decide which method to apply on a case-by-case basis.
Given the discretion to employ either or both methods, the Court finds that this is a case that is particularly appropriate for the cross-check approach because of the novel and sophisticated legal issues involved, the scope of discovery, and the difference between the Available Benefit and the Actual Payment to the Settlement Class. Accordingly, the Court will address both the lodestar analysis and the percentage of the fund analysis below.
1. The Lodestar Analysis
In determining what is a reasonable amount of attorneys’ fees, a useful starting point is to determine the “lodestar,” which is calculated by multiplying the proven number of hours reasonably expended on the litigation by a reasonable hourly rate.
Reed,
179 F.3d at 471 ;
see also Isabel,
404 F.3d at 415 . When a court is calculating the lodestar, the party seeking attorneys’ fees bears the burden of proving the reasonableness of the hourly rates claimed.
Granzeier v. Middleton,
173
*793
F.3d 568, 577 (6th Cir.1999) (citing
Hensley v. Eckerhart,
461 U.S. 424, 433 , 103 S.Ct. 1933 , 76 L.Ed.2d 40 (1983)). Further, sufficient documentation must be offered in support of the hours charged, i.e., the documentation “must be of sufficient detail and probative value to enable the court to determine with a high degree of certainty that such hours were actually and reasonably expended in the prosecution of the litigation.”
Imwalle v. Reliance Med. Prods.,
515 F.3d 531, 553 (6th Cir.2008) (noting that “counsel need not record in great detail each minute he or she spent on an item,” but indicating that “the general subject matter should be identified”) (internal quotations omitted). Counsel for the prevailing party must make a good faith effort to exclude from a fee application hours that are “excessive, redundant, or otherwise unnecessary.”
Hensley,
461 U.S. at 434 , 103 S.Ct. 1933 .
a. The Lodestar Figure
Class Counsel submits that the total lodestar figure — reasonable hours multiplied by reasonable rates — is $3,489,875.00. (Doc. 176 at 14.) In support of this figure, each of the attorneys and/or law firms submitted an affidavit with supplemental documentation regarding billing rates and the hours expended on the this litigation.
(Id.
Exs. A-G.) The Court has reviewed each of these affidavits, and the associated billing records, carefully. The following chart depicts the rates and hours submitted by each attorney/Iaw firm within the definition of Class Counsel:
Ex. AttorneulLaw Firm-Rates/ Hr. Hours Total Lodestar
A Charles F. Barrett, Barrett & Associates 135.9 $ 44,167.50
B John W. (Don) Barrett, Barrett Law Office, P.A._._$650 324.7 211,029.00
B Chris Hammett, Paralegal at Barrett Law _Office, P.A_ 64.4 4,743.00
C Pierce Gore, Gore Law Firm $375 3,221 $1,207,875.00
D Dewitt M. Lovelace, Lovelace Law Firm, P.A.__$425 296 125,800. 00
D Sandy Rosenthal, Paralegal at Lovelace Law _Firm, P.A._$150 215.8 32,370.00
E Attorneys at Lieff, Cabraser, Heimann & _Bernstein, LLP_ -$395 81.3 39,711.00
E Paralegals at Lieff, Cabraser, Heimann
&
_Bernstein, LLP $215-$155 8.9 1,543.50
F Thomas P. Thrash $500 206.35 $ 103,175.00
G R. Eric Kennedy, Weisman, Kennedy, & _Berris Co., L.P.A._$650 699.65 $ 454,772.50
G Daniel Goetz, Weisman, Kennedy, & Berris Co., L.P.A.____$500 2066.52 $1,033,260.00
G David Landever, Weisman, Kennedy, & _Berris Co., L.P.A._$500 443.60 $ 221,800.00
Totals: Attorney Hours: 7475.02 Attorney Total: $3,441,590.00
Paralegal Hours: 289.1 Paralegal Total: $ 38,656.50
Total Hours: 7764.12 Grand Total: $3,480,256.50
Class Counsel also submitted an accounting of costs and expenses in the total amount of $135,249.04.
(See
Doc. 176 Ex. A-G.) These costs and expenses were not
*794
included in Class Counsel’s suggested lodestar figure.
The Grand Total in the chart above is $9,618.50 less than the lodestar figure Class Counsel submitted.
24
The Court will, however, use the Grand Total in the chart above as the starting point for the lodestar figure. After thorough and careful review of the billing statements the Court makes the following observations and findings:
• Class Counsel consists of experienced attorneys with expertise specific to complex class actions on a national scale.
(See
Doc. 176 Ex. A-G.) With this in mind, although the rates listed above are high compared to the average attorney, based on this Court’s knowledge of attorneys’ fees in complex civil litigation and multi-district litigation, the requested rates are reasonable for this case considering the experience and expertise these particular lawyers have in this particular area of law.
• The number of attorney hours is reasonable based on the following factors: (1) this litigation has lasted for over five years; (2) the novel legal theories and vigorous defense required Class Counsel to spend thousands of hours researching, briefing, and preparing to present the legal issues to the Court, and the quality of Class Counsel’s submissions has consistently reflected the substantial time devoted to the task; (3) discovery was document-intensive and contentious; and (4) because the Settlement Class is national in scope, and settlement negotiations were hard-fought, the time devoted to travel to and from settlement negotiations, in addition to Court conferences and proceedings, was reasonable and necessary.
• Paralegal time is compensable in recognition of the fact that it is an economical allocation of personnel given that the rates for paralegals are significantly lower than attorneys.
See generally Gross v. Perrysburg Exempted Vill. Sch. Dist.,
306 F.Supp.2d 726, 737 (N.D.Ohio 2004) (collecting cases in support of the proposition that “numerous Sixth Circuit cases uphold!] an award of paralegal fees in fee-shifting cases”);
see also Lipsett v. Blanco,
975 F.2d 934, 939 (1st Cir.1992) (“The efficient use of paralegals is, by now, an accepted cost-saving device.”).
• Class Counsel is
not
requesting compensation for the significant costs incurred during the course of this litigation (approximately $135,249.04).
Accordingly, the Court finds that the lodestar figure — reasonable hours multiplied by reasonable rates — is $3,480,256.50.
b. Lodestar Multiplier
Next, Class Counsel requests that the lodestar figure be enhanced by a multiplier of 1.3. (Doc. 176 at 15.) Multipliers are not uncommon in class action settlement cases to enhance the lodestar figure in recognition of the “risk an attorney assumes in undertaking a case, the quality of the attorney’s work product, and the public benefit achieved.”
Rawlings,
9 F.3d at 515-17;
see also Sulzer,
268 F.Supp.2d at 922 ;
Bailey v. AK Steel Corp.,
2008 WL 553764 (S.D.Ohio 2008) (applying lodestar multiplier of 3.04);
In re Revco Sec. Litig.,
1992 WL 118800 (N.D.Ohio 1992) (applying lodestar multi
*795
plier of 2.5); Newberg on Class Actions § 14.6 (4th ed. 2009) (“Multiples ranging from one to four frequently are awarded in common fund cases when the lodestar method is applied.”).
In determining whether a requested multiplier is appropriate, the Court seeks guidance from the six factors identified by the Sixth Circuit in
Ramey v. Cincinnati Enquirer, Inc.,
508 F.2d 1188, 1196 (6th Cir.1974),
cert. denied,
422 U.S. 1048 , 95 S.Ct. 2666 , 45 L.Ed.2d 700 (1975). The
Ramey
factors are:
(a) the value of the benefits rendered to the class; (b) society’s stake in rewarding attorneys who produce such benefits in order to maintain an incentive to others; (c) whether the services were undertaken on a contingent fee basis; (d) the value of the services on an hourly basis; (e) the complexity of the litigation; and (f) the professional skill and standing of all counsel.
Sulzer,
268 F.Supp.2d at 930 (quoting
Telectronics,
137 F.Supp.2d at 1042 (citing
Ramey,
508 F.2d at 1196 )).
i. The Value of the Benefits Rendered to the Class
The most important
Ramey
factor is the first — the value of the benefit to the class.
Sulzer,
268 F.Supp.2d at 930 . As detailed above, the Settlement Agreement provides $8.69 per Class Policy Period to each member of the Settlement Class who submits a timely, valid claim form. In total, this amounts to $2,812,962 and represents a 20 percent recovery of the Total Actual Loss.
(See supra;
Doc. 191.) Each Settlement Class Member is also entitled to a pro rata share of the $2 million reversion. Furthermore, the costs ($420,306) and attorneys’ fees will be paid by Travelers, and the Settlement Agreement benefits the Settlement Class and the public generally by enjoining the practice at issue for at least three years. The value of the Available Benefit to the Settlement Class is more controversial for the reasons discussed below, but, assuming based on
Boeing Co. v. Van Gemert,
444 U.S. 472 , 100 S.Ct. 745 , 62 L.Ed.2d 676 (1980), that it has
some
value,
see Waters v. Int’l Precious Metals Corp.,
190 F.3d 1291 (11th Cir.1999), the total Available Benefit is $17,943,693.18. Finally, as this Court noted in
Sulzer,
the paucity of objections suggests that the Settlement Class Members believe the Settlement Agreement is beneficial. Even assuming for the sake of argument that the Available Benefit has limited value, the other significant benefits to the Settlement Class justify the multiplier,
ii. Society’s Stake in Rewarding Attorneys Who Produce Such Benefits
As noted above, the Court must ensure that Class Counsel is fairly compensated in order to facilitate the goal of class actions — i.e., to provide a vehicle for collective action to pursue redress for tortious conduct that it is not feasible for an individual litigant to pursue. The Court is cognizant of the fact that Travelers has not admitted liability and the Court cannot pass judgment on Travelers’ liability. Nonetheless, as a result of this Settlement Agreement, thousands of consumers will recover a meaningful portion of the premium that they would not have had to pay if Travelers had offered them the lower-priced policy. But for this litigation, it is a virtual certainty that these consumers would not have received a rebate of any kind. Furthermore, as a result of this litigation, Travelers eliminated their practice of selling identical policies for different prices and the Settlement Agreement enjoins Travelers from reinstating that practice for at least three years. (Doc. 176 at 16.) This injunction prohibits a potentially
25
discriminatory practice, a benefit that
*796
extends outside the Settlement Class to society at large. Accordingly, the requested 1.3 multiplier is justified based on this factor.
iii. Contingent Fee Basis & Value of Service Rendered
The third
Ramey
factor is whether Class Counsel undertook the litigation on a contingent fee basis. This factor accounts for the substantial risk an attorney takes when he or she devotes substantial time and energy to a class action despite the fact that it will be uncompensated if the case does not settle and is dismissed. Class Counsel took this case on a contingent fee basis and, as demonstrated by the lodestar calculations above, the magnitude of that risk is remarkable. Class Counsel devoted approximately 7,765 hours to the case, all of which would have been for naught if they lost at any stage of the litigation after September 2009 — summary judgment, trial, or on appeal. Similarly, with respect to the fourth
Ramey
factor, the lodestar figure — $3,480,256.50—illus-trates the magnitude of the risk Class Counsel assumed in terms of lost time that could have been devoted to other matters. These factors strongly support the requested multiplier.
iv. The Complexity of the Litigation & The Professional Skill and Standing of Class Counsel
Lastly, the fifth and sixth
Ramey
factors deal with the complexity of the litigation and expertise and performance of counsel. As described throughout this Opinion & Order, this was not an easy case, and Class Counsel did a commendable job throughout. The Court essentially agrees with Class Counsel’s summary of the difficulty of this case and the Court’s assessment of their performance as set forth in their Fee Petition.
{See
Doc. 176 at 20-21.) Accordingly, these factors also strongly support the requested multiplier,
v. Multiplier of 1.3
For all of the reasons discussed within the context of the
Ramey
factors, the Court finds that the requested multiplier of 1.3 is justified. In fact, numerous cases have approved multipliers in excess of 1.3 in similar circumstances.
See, e.g., Sulzer,
268 F.Supp.2d at 938 n. 45 (citing Stuart J. Logan, Dr. Jack Moshman & Beverly C. Moore, Jr.,
Attorney Fee Awards in Common Fund Class Actions,
24 Class Action Reports (Mar.-Apr.2003) summarizing the findings of these authors regarding multipliers between 1973 and 2003 and noting that the average effective multiplier across 1,120 cases was 3.89). Consequently, the Court will apply a multiplier of 1.3 to the lodestar figure.
26
c. Final Lodestar Figure
After applying the multiplier of 1.3 the final lodestar figure is $4.6 million.
2. Percentage of the Fund
The percentage of the fund method requires the Court to consider the ratio of the attorneys’ fee to the total class benefit. It allows the Court to cross-check the final lodestar figure to ensure that the fee award is reasonable compared to the Set
*797
tlement Class’ benefits.
See, e.g., Sulzer,
268 F.Supp.2d at 922 . The first step in the percentage of the fund method is to determine the total monetary value of the Settlement Agreement to the Settlement Class — i.e., the “Total Class Benefit.” One component of the Total Class Benefit is the “Benefit Fund” — i.e., the $8.69 cash payment per Class Policy Period provided for in the Settlement Agreement. How to assess the value of the Benefit Fund is a hotly contested issue.
Class Counsel included a helpful chart in its Fee Petition to illustrate the components they believe should be included as part of the Total Class Benefit for purposes of performing the percentage of the fund cross-check. (Doc. 176 at 23.) Because that chart was prepared prior to the close of the claims period, the numbers were estimates meant to be updated after the close of the claims period. The following chart includes the updated numbers:
Benefit Bund — midpoint between the available benefit ($17,943,693.18) and the estimated actual payment ($2,812,962.00): $10,378,327.59
Reversion From Attorney Fee Fund: $ 2,000,000.00
Attorney Fees: $ 4,600,000.00
Costs of Notice and Administration: $ 420,306.00
Total Class Benefit (according to Class Counsel): $17,398,633.59
(Doc. 176 at 23.) Mr. Frank agrees that the Actual Payment to the Settlement Class Members and the Costs of Notice and Administration are legitimate components of the Total Class Benefit. (Tr. Fairness Hrg., Doc. 188 at 52-53.) He makes a half-hearted attempt to halve the $2 million Reversion (and, thus, excise half of the Reversion from the Total Class Benefit calculation) on the grounds that
he
is responsible for that particular benefit, and contends that the $4.6 million in attorneys’ fees should be reduced by a mathematical formula
27
because, if the Court does not award the full $4.6 million, the remainder reverts back to Travelers, not the Settlement Class. (Tr. Fairness Hrg., Doc. 188 at 53.) The main point of contention, however, is whether the value of the Benefit Fund should be the Available Benefit or the Actual Payment — i.e., whether it is the amount the Settlement Class
would
receive if every potential Settlement Class Member returned a timely, valid claim form ($17,943,693.18) or it is the amount of actual claims paid ($2,812,962). It is undisputed that the unclaimed portion of the Available Benefit will revert back to Travelers under the terms of the Settlement Agreement. In sum, at the Final Fairness Hearing, Mr. Frank essentially argued that the Total Class Benefit can be estimated as follows:
Benefit Fund — the Actual Payment amount: $2,812,962.00
Reversion From Attorney Fee Fund: $1,000,000.00
Attorney Fees: $1,533,333.33
Costs of Notice and Administration: $ 420,306.00
Total Class Benefit (according to Mr. Frank): $5,766,601.33
(Tr. Fairness Hrg., Doc. 188 at 53-54.)
28
Clearly, there is a substantial gap between Class Counsel’s assessment of the value of
*798
the Total Class Benefit and Mr. Frank’s.
29
The different assessment of the value of the Benefit Fund is the largest component of the gap.
a. The Benefit Fund
Both Class Counsel and Mr. Frank acknowledge that whether the percentage of the fund should be calculated using the Available Benefit or the Actual Payment is a matter of unsettled law. In
Boeing Co. v. Van Gemert,
444 U.S. 472, 479-81 , 100 S.Ct. 745 , 62 L.Ed.2d 676 (1980), the Supreme Court recognized that the amount of the fund
available
was a benefit to the class:
In this case, the named respondents have recovered a determinate fund for the benefit of every member of the class whom they represent.... To claim their logically ascertainable shares of the judgment fund, absentee class members need prove only their membership in the injured class. Their right to share the harvest of the lawsuit upon proof of their identity, whether or not they exercise it, is a benefit to the fund created by the efforts of class representatives and their counsel.
Boeing,
444 U.S. at 479-80 , 100 S.Ct. 745 (emphasis added).
30
As Class Counsel concedes in their Fee Petition, however, the Supreme Court’s approach to unclaimed funds in
Boeing
has not taken hold:
Since
Boeing ...
consideration of unclaimed funds in the determination of attorneys’ fees has been discouraged and even statutorily barred in certain contexts. The Private Securities Litigation Reform Act (“PSLRA”), for example, enacted in 1995, expressly limits fees in the context of securities litigation to “a reasonable amount of any damages and prejudgment interest
actually paid
to the class” 15 U.S.C. §§ 77z-l(a)(6); 78u-4(a)(6) (emphasis).
Although the Rules of Civil Procedure themselves are silent on the issue, citing the securities legislation, The Advisory Committee Notes to the 2003 amendments to Rule 23, subd. h, suggest that courts examine the extent to which claims procedures result in
actual
payouts to the class.
For a percentage approach to fee measurements, results achieved is the basic starting point. In many instances, the court may need to proceed with care in assessing the value conferred on class members. Settlement regimes that provide for future payments, for example, may not result in significant actual payments to class members. In this connection, the court may need to scrutinize the manner and operation of any applicable claims procedure. In some cases, it may be appropriate to defer some portion of the fee award until actual payouts to class members are known.
Citing these Advisory Committee notes, the Manual for Complex Litigation also endorses a fee award that is based on funds actually bestowed.
See also
Federal Judicial Center.
Manual for Complex Litigation
(Fourth) § 21.71 (2004).
In cases involving a claims procedure or a distribution of benefits over time, the court should not base the attorney fee award on the amount of money set aside to satisfy potential claims. Rather the fee awards should be
*799
based only on the benefits actually delivered. It is common to delay the final assessment of the fee award and to withhold all or a substantial part of the fee until the distribution process is complete.
Finally, in the 2005 Class Action Fairness Act (“CAFA”), Congress required that where “a proposed settlement in a class action provides for recovery of coupons to a class member, that portion of any attorney’s fee award to class counsel that is attributable to the award of the coupon shall be based on the value to the class of the
coupons that are redeemed.”
28 USCA § 1712(a) (emphasis added).
(Doc. 176 at 24-25.)
Courts, moreover, are split regarding how the value of the Benefit Fund should be calculated. Some have calculated attorneys’ fees using the percentage of the fund method based only upon the amount actually claimed.
See, e.g., Strong v. BellSouth Telecommunications, Inc.,
137 F.3d 844, 852-853 (5th Cir.1998) (affirming district court’s award of attorneys’ fees based strictly on actual claims);
Wise v. Popoff,
835 F.Supp. 977, 982 (E.D.Mich.1993) (calculating fees based on actual recovery and noting that “[although the Supreme Court has authorized courts to award attorney’s fees based on the entire fund,
Boeing ...
the Court notes that such a method is not mandated.”). Other courts use the Available Benefit as the measure of the Benefit Fund, regardless of the Actual Payment.
See, e.g., Masters v. Wilhelmina Model Agency, Inc.,
473 F.3d 423 (2d Cir.2007) (holding that the district court abused its discretion by calculating fees based strictly on the actual recovery, expressly rejecting the idea that basing the award on the Available Benefit would create a windfall for class counsel, and finding the instructions in the PSLRA and CAFA inapplicable);
Waters v. Int’l Precious Metals Corp.,
190 F.3d 1291 (11th Cir.1999),
cert. denied,
530 U.S. 1223 , 120 S.Ct. 2237 , 147 L.Ed.2d 265 (2000);
Williams v. MGM-Pathe Commun. Co.,
129 F.3d 1026 (9th Cir.1997) (reversing district court award of 33 percent of the claimed fund ($3,300) and awarding attorneys’ fees of 33 percent of the available fund ($1.5 million));
McKinnie v. JP Morgan Chase Bank, N.A.,
678 F.Supp.2d 806 (E.D.Wis.2009) (relying on
Boeing
in awarding 33 percent of the available fund, an fee award that exceeded the amount actually claimed).
31
Because of its procedural history, Waters is the case that best frames the debate now before the Court.
Waters
was a fraud case that settled for a $40 million common fund.
Waters,
190 F.3d at 1297 . Less than $6.5 million of the fund was actually claimed, however, and the remainder reverted to the defendants pursuant to the settlement agreement.
Id.
The Eleventh Circuit relied on
Boeing
and affirmed the district court’s fee award of approximately $13 million — one third of the
total
fund.
Id.
The Eleventh Circuit also found the PSLRA inapplicable and stated that “[cjontrary to defendants’ assertion, no case has held that a district court must consider only the actual payout in determining attorneys’ fees.”
Id.
at 1295. The defendant petitioned for a writ of certiorari and, although the petition was denied, Justice Sandra Day O’Connor identified the split of authority and wrote “I believe the importance of the issue counsels in favor of granting review in an appropriate case.”
Int’l Precious Metals Corp. v. Wa
*800
ters,
530 U.S. 1223 , 120 S.Ct. 2237 , 147 L.Ed.2d 265 (2000). Justice O’Connor explained:
In
Boeing
..., we upheld an award of attorney’s fees in a class action where the award was based on the total fund available to the class rather than the amount actually recovered.
Id.,
at 480-481 , 100 S.Ct. 745 . We had no occasion in
Boeing ,
however, to address whether there must at least be some rational connection between the fee award and the amount of the actual distribution to the class. The approval of attorney’s fees absent any such inquiry could have several troubling consequences. Arrangements such as that at issue here decouple class counsel’s financial incentives from those of the class, increasing the risk that the actual distribution will be misallocated between attorney’s fees and the plaintiffs’ recovery. They potentially undermine the underlying purposes of class actions by providing defendants with a powerful means to enticing class counsel to settle lawsuits in a manner detrimental to the class. And they could encourage the filing of needless lawsuits where, because the value of each class member’s individual claim is small compared to the transaction costs in obtaining recovery, the actual distribution to the class will inevitably be minimal. The Courts of Appeals have differed in their approaches to the problem.
Compare Strong v. BellSouth Telecommunications, Inc.,
137 F.3d 844, 852 (C.A.5 1998) (District Court did not abuse its discretion in basing fee award on actual payout rather than reversionary fund), with
Williams v. MGM-Pathe Communications Co.,
129 F.3d 1026, 1027 (C.A.9 1997) (benchmark for fee award is 25% of entire fund, and District Court abused its discretion in basing award on actual distribution to class).
Id.
Justice O’Connor’s chief concern is the “decoupling of class counsel’s financial incentives from those of the class.” She does not fundamentally challenge the principle announced in
Boeing,
444 U.S. at 474 , 100 S.Ct. 745 , that a class member benefits from the
right
to recovery, even if he or she does not exercise that right. Instead, she proposes that district courts employ an approach that ensures that there is “at least be some rational connection between the fee award and the amount of the actual distribution to the class.”
Waters,
530 U.S. at 1223 , 120 S.Ct. 2237 .
Class Counsel readily acknowledges the wisdom of a methodology that avoids decoupling class counsel’s interests from those of the class, but also insists that
Boeing
correctly reflects the value of leading a horse to water, even though you can’t make him drink.
(See supra,
footnote 30.) To address Justice O’Connor’s concern, Class Counsel proposes a compromise “that satisfies, to a degree, both positions”:
The compromise would have the Court take the mid-point between the amount available [$17,398,633.59] and the amount actually claimed [$2,812,962. 00] and use this number [$10,378,327.59] to establish the value of the [B]enefit [F]und. This approach is unique, however. Under this approach, there would not be a “decoupling” of class counsel’s monetary incentives from those of class members and at the same time, there would be recognition of the benefit created by a class member’s right to compensation.
(Doc. 176 at 29.)
Mr. Frank rejects the proposed compromise as an inadequate substitute for “a straight calculation based on the actual amount received by the class.” (Tr. Fairness Hrg., Doc. 188 at 43.) According to
*801
Mr. Frank, “the available benefit is a fiction.”
(Id.
at 53.) He argues that the way to incentivize class counsel to protect the best interests of the class “is to tie the fee award to the actual payments to the class, not on a 50 percent sliding scale as they propose but on the actual payments to the class, and that is the way to guarantee that the Plaintiffs’ lawyers will pay attention to the hoops that they are making the class members jump through.”
(Id.
at 44.) Accordingly, he argues that a reasonable fee pursuant to his percentage of the fund straight calculation based on the actual amount received by the class method would be $1.6 million — i.e., 25 percent of approximately $4.8 million. (Doc. 191 at 7.)
While Mr. Frank’s position is not without some force, the Court finds Class Counsel’s proposed compromise appropriate in this case. By mathematically tying attorneys’ fees to actual recovery by the class, the compromise directly addresses Justice O’Connor’s “decoupling” concern. Of course, Mr. Frank’s “straight calculation based on actual recovery” would address this concern in spades, but it runs the risk of conflicting with the Supreme Court’s
Boeing
principle that the Available Benefit
is
a benefit, and, as a corollary to that principle, that an important aspect of the Court’s responsibility in evaluating the Settlement Agreement is to ensure that class counsel is fairly compensated for the work done and the result achieved. In contrast, Class Counsel’s proposed compromise adheres to the
Boeing
principle by incorporating the value of the Available Benefit into the assessment of the Benefit Fund.
In the cases cited above where the circuit court found that the district court abused its discretion in awarding attorneys fees, the district court awarded fees based on actual recovery without regard for the
Boeing
principle.
See, e.g., Masters,
473 F.3d at 437 ;
Williams,
129 F.3d at 1027 . For example, in
Masters,
473 F.3d at 437 , the Second Circuit held that the district court abused its discretion by awarding fees based on the actual recovery, as opposed to the available benefit. The Second Circuit reasoned as follows:
In siding with courts that compute fees as a percentage of claims made, the District Court saw the alternative procedure as creating a “windfall” for the attorneys. We disagree. The entire Fund, and not some portion thereof, is created through the efforts of counsel at the instigation of the entire class. An allocation of fees by percentage should therefore be awarded on the basis of the total funds made available, whether claimed or not. We side with the circuits that take this approach.
See Waters v. Int’l Precious Metals Corp.,
190 F.3d 1291, 1295 (11th Cir.1999);
Williams v. MGM-Pathe Commc’ns Co.,
129 F.3d 1026, 1027 (9th Cir.1997).
Our own cases refer to “percentage of the fund,”
Wal-Mart Stores,
396 F.3d at 121 (emphasis supplied), and “percentage of the recovery,”
Goldberger [v. Integrated Res., Inc.],
209 F.3d [43] at 47 [ (2d Cir.2000) ] (emphasis supplied). We take these references to be to the whole of the Fund.
Id.
32
Similarly, in Williams, the Ninth Circuit held that the district court abused its discretion when it based attorneys’ fees on
*802
actual recovery rather than the available benefit.
Williams,
129 F.3d at 1027 (“We conclude that the district court abused its discretion by basing the fee on the class members’ claims against the fund rather than on a percentage of the entire fund or on the lodestar.”). Mr. Frank’s proposed method in this case is the very method the district courts applied while abusing their discretion in
Masters
and
Williams .
Although the Court will not speculate that the Sixth Circuit would similarly find an abuse of discretion in this case if this Court were to follow Mr. Frank’s suggestions, there is no reason to test that hypothesis when Class Counsel has proposed a method that, under the particular circumstances of this case, is more consistent with the Court’s interpretation of applicable law and its Rule 23(e) duty to ensure that the Settlement Agreement is fair, reasonable, and adequate in all respects.
33
Accordingly, the Court will use Class Counsel’s proposed compromise to calculate the value of the Benefit Fund.
The Court finds that, for purposes of the percentage of the fund cross-check, the Benefit Fund should be valued at approximately $10,378,327.59 — the mid-point between the Available Benefit and the Actual Payment.
b. The Reversion
The second component of the Total Class Benefit on Class Counsel’s chart is the Reversion. The Reversion is the $2 million payment to the Settlement Class as a result of the parties’ post-Greenberg Objection amendment to the Settlement Agreement to reduce the requested attorneys’ fee from $6.6 million to $4.6 million and award the $2 million difference to the Settlement Class.
(See
Doc. 190.) This cash payment is unquestionably a benefit to the Settlement Class. Mr. Frank claims, however, that he is at least partially responsible for it because the timing of the agreement to amend the Settlement Agreement is significant circumstantial evidence that Mr. Greenberg’s objection caused the adjustment. Therefore, at the Final Fairness Hearing he argued that only half of the Reversion should be included in the Total Class Benefit for purposes of determining Class Counsel’s fee award. (Tr. Fairness Hrg., Doc. 188 at 53.)
As discussed below, however, the fact remains that it was Class Counsel who secured the Reversion for the Settlement Class by negotiating the First Amendment to the Settlement Agreement with Travelers. Mr. Frank was not a party to that negotiation. It cannot be disputed, moreover, that the Settlement Class received this additional actual benefit. Accordingly, the Court finds that the Total Class Benefit includes the $2 million Reversion for purposes of the percentage of the fund cross-check.
c. Costs of Notice & Administration
The third component of the Total Class Benefit is the costs of notice and administration that Travelers paid ($420,306.00). This is an expense that could have been borne by either party, but the Settlement Agreement provides that Travelers will assume it. Therefore, it is a benefit to the Settlement Class.
34
See Staton v. Boeing,
327 F.3d 938, 975 (9th Cir.2003);
Mangone
*803
v. First USA Bank,
206 F.R.D. 222, 228 (S.D.Ill.2001). The Court finds that, for purposes of applying the percentage of the fund cross-check, the Total Class Benefit includes the $420,306.00 in notice and administrative costs assumed by Travelers,
d. Attorneys’ Fees
The Settlement Agreement provides that Travelers will pay attorneys’ fees up to an amount not to exceed $4.6 million. Courts have found that such an independent agreement for the defendant to pay attorneys’ fees is a benefit to the settlement class.
See, e.g., Johnson,
83 F.3d at 245 -46 (citing
In re General Motors,
55 F.3d at 821 );
In re Vitamins Antitrust Litig.,
2001 WL 34312839 , at *9 (D.D.C. July 16, 2001). For his part, Mr. Frank suggested that the value of the fee award is something less than the total award and, without explanation, proposed the formula 0.25(4.6 + x) = x. While this is interesting, it is unsupported and the Court adopts the view of the courts cited above in finding that the attorneys’ fee award is a negotiated aspect of the Settlement Agreement that provides a benefit to the Settlement Class. Consequently, for purposes of calculating the percentage of the fee, the attorneys’ fee award of $4.6 million is part of the Total Class Benefit.
e. The Percentage of the Fund Cross-Check
Having determined that the four components of the Total Class Benefit— the Benefit Fund, the Reversion, Notice and Administration Costs, and Attorneys’ Fees — are all appropriate for inclusion in the Total Class Benefit, and that, together, they total $17,398,633.59, the Court must now analyze the reasonableness of the requested $4.6 million attorneys’ fee award.
See Sulzer,
268 F.Supp.2d at 923 . Before the close of the claims period, Class Counsel calculated the requested $4.6 million fee award as approximately 25 percent of the estimated Total Benefit Fund, which, at the time was estimated at $17,520,306-$18,020,306. (Tr. Fairness Hrg., Doc. 188 at 18, Ex. 1.) Now that the claims period has closed, and the Court has determined that the Total Class Benefit is $17,398,633.59, the requested $4.6 fee award is 26.4 percent of the Total Class Benefit. In their Fee Petition, Class Counsel cites over a dozen cases in which a similar (or larger) percentage was approved by the court in the context of the percentage of the fund methodology. (Doc. 176 at 31-32.) As these cases demonstrate, this percentage is well within the acceptable range for a fee award in a class action. Furthermore, as discussed above in the context of the lodestar multiplier, $4.6 million is a reasonable fee award based on the Court’s analysis of the six
Ramey
factors. Accordingly, the percentage of the fund cross-check confirms that the $4.6 million final lodestar figure is a reasonable attorneys’ fee award under the circumstances of this case.
IV.
MR. GREENBERG’S REQUEST FOR ATTORNEYS’ FEES
In his supplemental brief, Mr. Green-berg argues that he is entitled to reasonable attorneys’ fees and an incentive award for his role in improving the Settlement Agreement for the benefit of the Settlement Class. (Doc. 191 at 7.) Specifically, he argues that:
On the eve of the fairness hearing, the parties agreed to reduce the attorneys’ fees by $2 million and increase class recovery by the same amount. Because the court does not have the power to “blue pencil” the settlement, this decision has to be attributed to the only formal objection filed in this case — especially given the timing of the decision to modify the settlement.
(Id.)
Sixth Circuit case law recognizes that awards of attorneys’ fees to objectors
*804
may be appropriate where the objector provided a benefit to the class by virtue of their objection.
See Bowling,
102 F.3d at 779 (affirming award of fees to objector);
see also Olden v. Gardner,
294 Fed.Appx. 210, 221 (6th Cir.2008) (“Fees and costs may be awarded to the counsel for objectors to a class action settlement if the work of the counsel produced a beneficial result for the class.” (omitting internal citations));
In re Cardinal Health, Inc. Sec. Litig.,
550 F.Supp.2d 751, 753-54 (S.D.Ohio 2008) (“An objector to a class-action settlement is not normally entitled to a fee award unless he confers a benefit on the class.
Vizcaino v. Microsoft Corp.,
290 F.3d 1043, 1051 (9th Cir.2002);
In re Prudential Ins. Co. of America Sales Practices Litigation,
273 F.Supp.2d 563, 565 (D.N.J.2003).”). The standard of review on appeal for an award of attorneys’ fees to an objector is abuse of discretion.
See Bowling,
102 F.3d at 779. In addition, as explained in
In re Cardinal Health,
550 F.Supp.2d at 753-54 , in evaluating a request for attorneys’ fees filed by an objector, courts are mindful of the fact that some attorneys use such requests as an opportunity to capitalize on a class settlement without having provided any real and meaningful benefit to the class.
Mr. Greenberg and his counsel, Mr. Frank, argue that they have provided a benefit to the Settlement Class by at least encouraging the parties to re-visit the attorneys’ fees provisions of the Settlement Agreement. In addition, the Court is convinced that Mr. Frank’s goals are policy-oriented as opposed to economic and self-serving. With the exception of pointing out that the amendment to the Settlement Agreement occurred after he filed his objection, however, Mr. Greenberg has not submitted any evidence to support the notion that his objections — as opposed to the objections of other Settlement Class Members, or even objections of the Court itself
35
— actually provided a meaningful benefit to the class. While Mr. Frank’s policy arguments contribute to the legal discussion regarding this important area of law, the Court finds that they did not increase the tangible or intangible benefits available to
this
Settlement Class. Accordingly, the Court DENIES Mr. Green-berg’s request for leave to file a formal fee petition.
V.
CONCLUSION
For all of the foregoing reasons, the Court hereby GRANTS Plaintiffs’ Motion for Final Approval of Class Action Settlement and Incentive Award to Class Representatives (“Motion for Final Approval”) (Doc. 175) and GRANTS Motion for Order Granting Settlement Class Counsel’s Petition for Award of Attorney Fees and Expenses (“Fee Petition”) (Doc. 176). Further, the Court AWARDS Class Counsel’s fees and expenses in the amount requested, as calculated herein. Accordingly, the Court APPROVES the Settlement Agreement (Docs. 168, 190). Finally, the Court DENIES Mr. Greenberg’s motion for leave to file a petition for attorneys’ fees (Doc. 191).
IT IS SO ORDERED.
ORDER
I.
INTRODUCTION
On March 31, 2010, the Court issued an Opinion & Order granting (1) Plaintiffs’
*805
Motion for Final Approval of Class Action Settlement and Incentive Award to Class Representatives (“Motion for Final Approval”) (Doc. 175); and (2) Motion for Order Granting Settlement Class Counsel’s Petition for Award of Attorney Fees and Expenses (“Fee Petition”) (Doc. 176). (Doc. 194 (“March 31 Opinion
&
Order”).) Because of the extensive history of the case, the importance of the Court’s duty with respect to ensuring the fairness and adequacy of class action settlement agreements under Rule 23 of the Federal Rules of Civil Procedure, and the fact that Class Counsel proposed an innovative approach to evaluating the propriety of the attorneys’ fee award in light of unsettled law, the Court devoted approximately fifty-eight (58) of the sixty (60) page Opinion & Order to analyzing and resolving the Motion for Final Approval and the Fee Petition.
(Id.)
It is those last two pages that are now before the Court, however. Objector Daniel Greenberg has filed a motion to reconsider section IV of the March 31 Opinion & Order under Rule 59(e), or, in the alternative, he requests discovery to prove that his objection was a benefit to the Settlement Class. (Doc. 198 (“Motion to Reconsider”).) Objector Greenberg’s Motion to Reconsider does not challenge any aspect of the Court’s analysis or conclusions with respect to the Motion for Final Approval or Fee Petition. It is narrowly tailored to address a single issue: whether the Court acted prematurely and/or improperly by denying Objector Greenberg’s request to file a motion for leave to file a petition for attorneys’ fees for his attorney, Theodore H. Frank of the Center for Class Action Fairness. It is this ruling — and this ruling alone — that Objector Greenberg is now asking the Court to reconsider under Rule 59(e) of the Federal Rules of Civil Procedure. For the reasons explained below, the Court GRANTS, in part, Objector Greenberg’s Motion to Reconsider and AWARDS Objector Greenberg: (1) $500.00 as an incentive award and (2) $39,936.00 for attorneys’ fees.
1
II.
DISCUSSION
A. BACKGROUND
The procedural history of this case is set forth in detail in the March 31 Opinion & Order, as well as the extensive class certification opinions the Court previously issued (Docs. 128 and 141). Accordingly, with one notable exception discussed immediately below, the Court will not reiterate that information here, but, instead, expressly incorporates the procedural history sections of those orders into this Order.
(See
Docs. 128,141,194.)
After years of hard-fought litigation, the parties reached a Settlement Agreement fully resolving this case in the Fall of 2009. That Settlement Agreement initiated the required procedures for obtaining the Court’s approval of the Settlement Agreement under Rule 23 of the Federal Rules of Civil Procedure. The Court preliminarily approved the parties’ Settlement Agreement in November 2009. (Doc. 170.) As preliminarily approved, the Settlement Agreement included a provision for attorneys’ fees pursuant to which Class Counsels’ fees would be paid by the Defendants from a fund independent of the funds available to the Settlement Class. (Doc. 194 at 11.) Further, the Defendants agreed not to oppose a request for attor
*806
neys’ fees by Class Counsel up to $6.6 million.
(Id.)
During the course of the Rule 23 approval process, however, the parties negotiated an amendment to the Settlement Agreement in late-January 2010. Specifically, they reduced the amount Class Counsel could request without objection by $2 million and agreed to add that $2 million reversion from the attorneys’ fees fund to the amount available to the class.
(Id.)
This amendment is central to Objector Greenberg’s arguments in the Motion to Reconsider. Objector Greenberg accurately notes that the amendment was negotiated after the deadline for Settlement Class Member objections — and, thus, after he filed his objection. (Doc. 198 at 3.) Simply put, Objector Greenberg believes that his objection caused the parties to amend the settlement to add this $2 million reversion to the amount available to the Settlement Class, or, at least, his objection was an important factor that contributed to the parties’ decision to amend. Consequently, he argues, he is entitled to attorneys’ fees in recognition of the benefit his objection provided to the Settlement Class.
The additional background information critical to resolving the Motion to Reconsider is Section IV of the March 31 Opinion & Order — i.e., the ruling Objector Greenberg is asking the Court to reconsider. In its entirety, Section IV of the March 31 Opinion & Order states as follows:
IV. MR.
GREENBERG’S REQUEST FOR ATTORNEYS’ FEES
In his supplemental brief, Mr. Green-berg argues that he is entitled to reasonable attorneys’ fees and an incentive award for his role in improving the Settlement Agreement for the benefit of the Settlement Class. (Doc. 191 at 7.) Specifically, he argues that:
On the eve of the fairness hearing, the parties agreed to reduce the attorneys’ fees by $2 million and increase class recovery by the same amount. Because the court does not have the power to “blue pencil” the settlement, this decision has to be attributed to the only formal objection filed in this case-espeeially given the timing of the decision to modify the settlement.
(Id.)
Sixth Circuit case law recognizes that awards of attorneys’ fees to objectors may be appropriate where the objector provided a benefit to the class by virtue of their objection.
See Bowling,
102 F.3d at 779 (affirming award of fees to objector);
see also Olden v. Gardner,
294 Fed. Appx. 210, 221 (6th Cir.2008) (“Fees and costs may be awarded to the counsel for objectors to a class action settlement if the work of the counsel produced a beneficial result for the class.” (omitting internal citations));
In re Cardinal Health, Inc. Sec. Litig.,
550 F.Supp.2d 751, 753-54 (S.D.Ohio 2008) (“An object or to a class-action settlement is not normally entitled to a fee award unless he confers a benefit on the class.
Vizcaino v. Microsoft Corp.,
290 F.3d 1043, 1051 (9th Cir.2002);
In re Prudential Ins. Co. of America Sales Practices Litigation,
273 F.Supp.2d 563, 565 (D.N.J.2003).”). The standard of review on appeal for an award of attorneys’ fees to an objector is abuse of discretion.
See Bowling,
102 F.3d at 779. In addition, as explained in
In re Cardinal Health,
550 F.Supp.2d at 753-54 , in evaluating a request for attorneys’ fees filed by an objector, courts are mindful of the fact that some attorneys use such requests as an opportunity to capitalize on a class settlement without having provided any real and meaningful benefit to the class.
*807
Mr. Greenberg and his counsel, Mr. Frank, argue that they have provided a benefit to the Settlement Class by at least encouraging the parties to re-visit the attorneys’ fees provisions of the Settlement Agreement. In addition, the Court is convinced that Mr. Frank’s goals are policy-oriented as opposed to economic and self-serving. With the exception of pointing out that the amendment to the Settlement Agreement occurred after he filed his objection, however, Mr. Greenberg has not submitted any evidence to support the notion that his objections — as opposed to the objections of other Settlement Class Members, or even objections of the Court itself
2
— actually provided a meaningful benefit to the class. While Mr. Frank’s policy arguments contribute to the legal discussion regarding this important area of law, the Court finds that they did not increase the tangible or intangible benefits available to
this
Settlement Class. Accordingly, the Court DENIES Mr. Greenberg’s request for leave to file a formal fee petition.
(Doc. 194 at 58-59 (footnote in original).) In other words, based on its intimate knowledge of this longstanding class action dispute, its supervision of the settlement process, and the arguments submitted in writing and at the final fairness hearing, the Court exercised its discretion to find that Objector Greenberg had not conferred a benefit upon the class sufficient to support an award of attorneys’ fees.
B. MOTION TO RECONSIDER
Objector Greenberg’s Motion to Reconsider challenges this discretionary finding pursuant to Rule 59(e) of the Federal Rules of Civil Procedure. (Doc. 198.) He argues that the March 31 Opinion & Order must be altered or amended because the Court made “a clear error of law” or because “newly discovered evidence” requires it.
(Id.
at 2 (citing
GenCorp, Inc. v. Am. Int’l Underwriters,
178 F.3d 804 , 834 (6th Cir.1999), for the standard applicable to a Rule 59(e) motion).)
1. Summary of Objector Greenberg’s Arguments
a. “Clear Error”
According to Objector Greenberg, the Court committed “clear error” when it “prematurely” denied him leave to file a fee petition. He states that “[t]he Court’s ruling was premature, because Objector [Greenberg] did not have grounds to file a motion for fees.” (Doc. 198 at 2.) This is because, he argues, “[p]rior to approval, Objector [Greenberg] had no possible claim for attorneys’ fees, and indeed maintained that the proposed settlement should be disapproved as unfair to the class, even as amended. If Objector [Greenberg] had prevailed in his renewed objection, he would not be entitled to attorneys’ fees.”
(Id.
at 2, n. 1.) Similarly, he argues that the denial was premature because “it was based on the lack of evidence in support of a fee award, but Greenberg was not obligated to present such evidence until after the approval of the settlement.”
(Id.
at 1.)
b. “Newly Discovered Evidence”
The “newly discovered evidence” upon which Objector Greenberg relies is contained primarily in an affidavit from Class Counselor R. Eric Kennedy dated April 26, 2010. (Doc. 198-1.) In its entirety, Mr. Kennedy’s affidavit states as follows:
*808
I, R. Eric Kennedy, under penalty of perjury do hereby submit this affidavit and state as follows:
1. I am an attorney licensed in the State of Ohio and I am one of the Class Counsel in the case styled
Paul Lonardo, et al. v. The Travelers Indemnity Company,
U.S. District Court, N.E. Ohio, Case No. 06 CV 962.
2. I was intimately involved in all settlement negotiations in this matter from the first negotiation that officially began in the Spring of 2009 and all subsequent and continuing negotiations, including the negotiations that culminated in the First Amendment to Settlement Agreement.
3. On January 11, 2010 the Objection of Daniel Greenberg was filed by his counsel Theodore H. Frank of the Center for Class Action Fairness. (D.C. Docket No. 173).
4. I, along with my co-counsel, thoroughly reviewed and analyzed Mr. Greenberg’s objection.
5. Mr. Greenberg’s objection played a role in the continuing negotiations that culminated in the First Amendment to the Settlement Agreement. (D.C. Docket No. 190).
6. The objection of Mr. Greenberg provided value to the Class Members.
7. Any fee awarded to Mr. Green-berg’s counsel should come from the Class Counsel’s fees and expenses previously awarded by this Honorable Court. (D.C. Docket No. 194).
FURTHER AFFIANT SAYETH NOT.
(Doc. 198-1 (“Kennedy Affidavit”).) Objector Greenberg characterizes the Kennedy Affidavit as “previously unavailable evidence” because it was obtained as a result of conversations between Class Counsel and Mr. Frank
after
the March 31 Opinion & Order. (Doe. 198 at 4.) Specifically, in his own declaration in support of the Motion to Reconsider, Mr. Frank states:
Plaintiffs’ attorney R. Eric Kennedy told me in a telephone conversation on April 10, 2010 that the objection played a role in the negotiations for the amendment to the settlement. Mr. Kennedy agreed to provide a declaration to that effect. Mr. Greenberg offered no consideration in exchange for that declaration. I believe that Mr. Kennedy’s declaration is dis-positive on the issue, but, on information and belief, discovery would produce further evidence that the Greenberg objection made a material difference in class recovery.
(Doc. 198-2 ¶ 8 (“Frank Declaration”).)
2. The Rule 59(e) Standard
A motion to reconsider may be treated as a motion to alter or amend a judgment pursuant to Rule 59(e) of the Federal Rules of Civil Procedure.
3
Inge v. Rock Fin. Corp.,
281 F.3d 613 , 617-18 (6th Cir.2002);
Smith v. Hudson,
600 F.2d 60, 62 (6th Cir.1979). “The grant or denial of a Rule 59(e) motion is within the informed discretion of the district court, reversible only for abuse.”
Betts v. Costco Wholesale Corp.,
558 F.3d 461, 467 (6th Cir.2009) (quoting
Scotts Co. v. Central Garden & Pet Co.,
403 F.3d 781, 788 (6th Cir.2005)). A Rule 59(e) mo

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/2538499. Public record. Not legal advice.