Fb’s lawyers blast attorney charges bid in deal over 2018 information breach

By Sara Merken

(Reuters) – Facebook Inc is pushing back on plaintiffs lawyers’ request for nearly $12 million in fees and costs for securing an injunctive relief-only settlement stemming from a 2018 cyberattack that affected millions of Facebook users.

In a Monday night filing in California federal court, Facebook’s lawyers at Latham & Watkins said the request is “not supported by law” and is contrary to the court’s guidance when appointing the counsel for the class.

John Yanchunis of Morgan & Morgan, Ariana Tadler of Milberg Tadler Phillips Grossman and Andrew Friedman of Cohen Milstein Sellers & Toll – appointed counsel for the class of Facebook users – didn’t immediately respond to requests for comment on Facebook’s opposition.

U.S. District Judge William Alsup in San Francisco gave preliminary approval to the settlement in November. The deal requires Facebook to implement several security commitments and maintain them for five years with external oversight.

Alsup said in the November order that Facebook could oppose class counsel’s fee request, noting that since the relief is injunctive, the fee “will not detract from plaintiffs’ recovery.” He had ruled the year prior that users could sue as a group to seek better security but not monetary damages.

In a motion for attorneys’ fees filed last month, lawyers for the class said the outcome “leaves an historic impact on Facebook’s security measures, in large part due to Class Counsel’s litigation and mediation efforts and strategies.”

The lawyers requested $10.7 million in attorneys’ fees, an award that includes a multiplier of 1.253 on top of their proposed lodestar fees of $8.5 million.

They also sought about $1.2 million in litigation costs, a $15,000 reserve for expert costs to monitor compliance, and a $5,000 service award for named plaintiff Stephen Adkins.

The social media company, while noting the “valuable relief” contained in the settlement, in the Monday filing asked Judge Alsup to “reduce Class Counsel’s lodestar, decline the requested multiplier, and limit recoverable costs.”

Class counsel “racked up a very sizeable bill pursuing damages theories that conferred no benefit on the Class,” Facebook said in the filing. “And Class Counsel now asks that this bill be paid without scrutiny, refusing to provide project-level or even chronological time records.”

On top of the “documentation deficiencies,” the “high-level, block-billed figures they have submitted reveal that the matter was not handled efficiently,” Facebook said.

The company pointed to “top-heavy staffing” that it said creates an hourly rate that is 35.8% higher than the average award in other data breach deals.

The company’s lawyers at Latham said the court should reject the request for a “2.1 million bonus,” referring to the proposed lodestar multiplier. Facebook also called the $1.2 million in costs “bloated with legally unrecoverable costs,” including “expert fees for excluded and irrelevant experts and extravagant travel.”

The litigation stemmed from a September 2018 breach that affected the personal information of about 29 million people, in which hackers exploited vulnerabilities in Facebook’s software that allowed them to generate access tokens that could be used to compromise users’ accounts.

Judge Alsup is slated to hold a hearing on April 8 on the motions for attorneys fees and final approval of the settlement.

The case is Adkins v. Facebook, Inc., U.S. District Court for the Northern District of California, No. 3:18-cv-05982-WHA

For the plaintiffs: John Yanchunis of Morgan & Morgan, Ariana Tadler of Milberg Tadler Phillips Grossman and Andrew Friedman of Cohen Milstein Sellers & Toll

For Facebook: Elizabeth Deeley of Latham & Watkins

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