Plaintiff, ) v. ) No CH-09735

Transcription

1 CALENDAR: 06 PAGE 1 of 29 CIRCUIT COURT OF IN THE CIRCUIT COURT OF COOK COUNTY, ILLINOIS COOK COUNTY, ILLINOIS COUNTY DEPARTMENT, CHANCERY DIVISION CHANCERY DIVISION CLERK DOROTHY BROWN WILLIAM TRUONG, individually and on ) behalf of a class of similarly situated individuals, ) ) Plaintiff, ) ) v. ) No. ) PEAK CAMPUS MANAGEMENT, LLC, ) Hon. Celia G. Gamrath a Delaware limited liability company, ) ICIM Corp., a Kentucky corporation, ) Cal. 6 ) Defendants. ) PLAINTIFF S CORRECTED MOTION & MEMORANDUM IN SUPPORT OF APPROVAL OF ATTORNEYS FEES, EXPENSES & INCENTIVE AWARD 1 Dated: December 19, 2017 Michael J. McMorrow mike@mjmcmorrow.com MCMORROW LAW, P.C. Firm ID: One North LaSalle St., 44th Floor Chicago, IL Tel: (312) [additional counsel listed on signature page] Counsel for Plaintiff William Truong and Class Counsel 1 Plaintiff files this corrected motion to submit corrected claims figures and inconsistencies.

2 TABLE OF CONTENTS I. INTRODUCTION...1 II. THE FACTS AND THE TCPA...2 A. The TCPA...2 B. Defendants Business and the Underlying Misconduct...3 III. THE LITIGATION...4 IV. THE SETTLEMENT...6 V. THE COURT SHOULD APPROVE THE UNOPPOSED ATTORNEYS FEES AND EXPENSES BECAUSE THEY ARE REASONABLE...7 A. The Requested Fees Represent 33% of the Common Benefit Provided to the Class a Percentage Consistent with the Range Found Reasonable by the Courts...11 PAGE 2 of 29 VI. B. The Requested Fees are Equally Appropriate Under the Lodestar Method...15 THE COURT SHOULD APPROVE THE UNOPPOSED INCENTIVE AWARD...20 VII. CONCLUSION...22 ii

3 TABLE OF AUTHORITIES Page(s) Cases Abbas v. Selling Source, LLC, No. 09-cv-3413, 2009 U.S. Dist. LEXIS (N.D. Ill. 2009)...2 Baksinski v. Northwestern Univ., 231 Ill. App. 3d 7 (1st Dist. 1992)...8 Beverly Bank v. Bd. of Review of Will Cty., 193 Ill. App. 3d 130 (3rd Dist. 1989)...16 Beesley v. Int'l Paper Co., No. 06-cv-703, 2014 U.S. Dist. LEXIS (S.D. Ill. 2014)...15 PAGE 3 of 29 Boeing Co. v. Van Gemert, 444 U.S. 472 (1980)...7 Brundidge v. Glendale Fed. Bank, 168 Ill.2d 235 (1995)...8, 10, 15 Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663 (2016)...3 Craftwood Lumber Co. v. Interline Brands, Inc., No. 11-cv-4462, 2015 U.S. Dist. LEXIS (N.D. Ill. 2015)...21 Fiorito v. Jones, 72 Ill.2d 73 (1978)...8 Florin v. Nationsbank of Georgia, N.A., 34 F.3d 560 (7th Cir. 1994)...16 Gastineau v. Wright, 592 F.3d 747 (7th Cir. 2010)...15 GMAC Mortg. Corp. of Pa. v. Stapleton, 236 Ill. App. 3d 486 (1st Dist. 1992)...20 Harman v. Lyphomed, Inc., 945 F.2d 969 (7th Cir. 1991)...16 Hensley v. Eckerhart, 461 U.S. 424 (1983)...7 iii

4 In re: Capital One Tel. Consumer Prot. Act Litig., 80 F. Supp. 3d 781 (N.D. Ill. 2015)...8, 12 In re: Sears, Roebuck & Co. Front-loading Washer Prod. Liab. Litig., No. 06-cv-7023, 2016 U.S. Dist. LEXIS (N.D. Ill. 2016)...17 In re: Synthroid Mktg. Litig., 325 F.3d 974 (7th Cir. 2003)...9 Jamison v. First Credit Servs., Inc.,, 290 F.R.D. 92 (N.D. Ill. 2013)...13 Jeffboat, LLC v. Director, Office of Workers Comp. Programs, 553 F.3d 487 (7th Cir. 2009)...15 Kaplan v. Houlihan Smith & Co., No. 12-cv-5134, 2014 U.S. Dist. LEXIS (N.D. Ill. 2014)...11 PAGE 4 of 29 Kirchoff v. Flynn, 786 F.2d 320 (7th Cir. 1986)...11 Kolinek v. Walgreen Co., 311 F.R.D. 483 (N.D. Ill. 2015)...9, 14 Landsman & Funk, P.C. v. Skinder-Strauss Associates, 639 F. App x 880 (3d Cir. 2016)...9 Lozano v. Twentieth Century Fox, 702 F. Supp. 2d 999 (N.D. Ill. 2010)...2 Meyenburg v. Exxon Mobil Corp., No. 05-cv-15, 2006 U.S. Dist. LEXIS (S.D. Ill. 2006)...12 Mims v. Arrow Fin. Servs. LLC, 132 S. Ct. 740 (2012)...2 Payton v. Kale Realty, LLC, No. 13-cv-8002, 2015 U.S. Dist. LEXIS (N.D. Ill. 2015)...17 People Who Care v. Rockford Bd. of Educ., Sch. Dist. No. 205, 90 F.3d 1307 (7th Cir. 1996)...17 Retsky Family Ltd. P ship v. Price Waterhouse LLP, No. 97-cv-7694, 2001 U.S. Dist. LEXIS (N.D. Ill. 2001)...11, 12 Ryan v. City of Chicago, 274 Ill. App. 3d 913 (1st Dist. 1995)...9, 10, 11, 12 iv

5 Satterfield v. Simon & Schuster, No. 06-cv-2893, Dkt. 131 (N.D. Cal. 2010)...22 Schulte v. Fifth Third Bank, 805 F.Supp. 2d 560 (N.D. Ill. 2011)...11, 12, 20 Shaun Fauley, Sabon, Inc. v. Metro. Life Ins. Co., 2016 IL App (2d) , 9, 11, 12, 13, 15, 16 Skelton v. Gen. Motors Corp., 860 F.2d 250 (7th Cir. 1988)...8 Spano v. Boeing Co., No. 06-cv-743, 2016 WL (S.D. Ill. 2016)...15, 16, 20 Spokeo, Inc., v. Robins, 136 S.Ct (2016)...4 PAGE 5 of 29 Spicer v. Chicago Bd. Options Exch., Inc., 844 F. Supp (N.D. Ill. 1993)...12 Sutton v. Bernard, 504 F.3d 688 (7th Cir. 2007)...8, 9 Vigus v. S. Illinois Riverboat/Casino Cruises, Inc., 274 F.R.D. 229 (S.D. Ill. 2011)...13 Wright v. Nationstar Mortage LLC, No. 14-cv-10457, 2016 U.S. Dist. LEXIS (N.D. Ill. 2016)...9, 14, 16 Wendling v. S. Ill. Hosp. Servs., 242 Ill.2d 261 (2011)...7 Statutes 47 U.S.C. 227(b)(1)(A) (B) ILCS 5/ Other Authorities Court Awarded Attorney Fees, Report of the Third Circuit Task Force, 108 F.R.D. 237 (3d. Cir. 1985)...9 Eisenberg & Miller, Incentive Award to Class Action Plaintiffs: An Empirical Study, 53 U.C.L.A. L.Rev (2006)...21 In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, FCC Report and Order, CG Docket No , v

6 18 FCC Rcd (July 3, 2003)...3 William B. Rubenstein, Newberg on Class Actions 14:6 (4th ed.)...11 PAGE 6 of 29 vi

7 I. INTRODUCTION Pursuant to 735 ILCS 5/2-801, and this Court s October 16, 2017 Order Preliminarily Approving Class Action Settlement, the Class Representative, William Truong, and Class Counsel hereby request that the Court approve Plaintiff s Motion for Approval of Attorneys Fees, Expenses, and Incentive Award in connection with Plaintiff s Class Action Settlement Agreement 2 with Defendants Peak Campus Management, LLC ( Peak ) and ICIM Corp. ( ICIM ) (collectively, Defendants ), and award Class Counsel attorneys fees from the Settlement Fund, inclusive of expenses, as well as an Incentive Award to Mr. Truong for serving as the Class Representative. Defendants do not object to the relief sought in this Motion. The Settlement achieved by Class Counsel is an exceptional result for Settlement Class PAGE 7 of 29 Members and establishes a Settlement Fund of $7,000,000.00, which provides each Settlement Class Member compensation of up to $ in cash for receiving text messages from or on behalf of Defendants alleged to have violated the TCPA. Notice of the Settlement through Publication Notice and Direct Notice commenced on November 6, 2017 and has been effective at reaching thousands of potential Class Members. To date, no Settlement Class Member has filed a valid objection to the proposed Settlement even though as of December 15, 2017 over 3,600 claims have already been filed by Settlement Class Members. 3 Class Counsel s fee request constitutes 33% of the total common fund made available to the Settlement Class. As set forth below, Class Counsel s requested fee award is consistent with 2 Unless otherwise indicated, capitalized terms have the same meaning as those terms are used in the Settlement Agreement, which is attached hereto as Exhibit A. 3 Class Counsel received a single anonymous objection that failed to comply with the Court s Preliminary Approval Order and should be stricken. Pursuant to Ill. Sup. Ct. R. 137(a), any unsigned paper filed with the court must be stricken unless the failure to sign the document is promptly corrected. Because of the passage of time since its filing and the fact that it was purposely presented to the court anonymously and without appearance of counsel, Plaintiff respectfully requests that the Court strike the anonymous objection from the record of this case. 1

8 applicable Illinois appellate law and fee awards granted in numerous other cases pending in the Circuit Court of Cook County and the Northern District of Illinois, and is also reasonable when cross-checked against the time and costs Class Counsel have already committed to resolving this litigation for the benefit of the Settlement Class Members. Both Class Counsel and Mr. Truong devoted significant time and effort to the prosecution of the Settlement Class Members claims, and their efforts have produced an extraordinary benefit for thousands of consumers nationwide. The requested attorneys fees and costs and Incentive Award are amply justified in light of the investment, risks, and excellent results obtained for the Settlement Class. Plaintiff and Class Counsel thus respectfully request that the Court approve the unopposed attorneys fees and costs of $2,323,333.00, and the unopposed Incentive Award of PAGE 8 of 29 $15, for the Class Representative. II. THE FACTS AND THE TCPA Although this Motion focuses on why the Court should approve the requested attorneys fees, a brief summary of the underlying facts and law involved in this litigation is helpful to provide context to the reasonableness of the fees Class Counsel are seeking. A. The TCPA. In enacting the TCPA [in 1991], Congress noted the nuisance of rampant telemarketing and the consequent costs of money, time, and the invasion of privacy to consumers. See Abbas v. Selling Source, LLC, No. 09-cv-3413, U.S. Dist. LEXIS , at *26 *27 (N.D. Ill. Dec. 14, 2009) (internal citations omitted); see also Mims v. Arrow Financial Services, 132 S. Ct. 740, 744 (2012); Lozano v. Twentieth Century Fox, 702 F. Supp. 2d 999, 1008 (N.D. Ill. 2010). Consequently, the TCPA prohibits parties from making calls using any automatic telephone dialing system or artificial or prerecorded voice to any cellular phone as well as certain 2

9 prerecorded voice calls to residential telephones unless such calls are made for emergency purposes or with the prior express consent of the called party. 47 U.S.C. 227(b)(1)(A) (B). Pursuant to its statutorily assigned duty to prescribe regulations implementing the TCPA (47 U.S.C. 227(b)(2)), the Federal Communications Commission ( FCC ) has determined that text messages constitute calls under the TCPA and are also actionable. In the Matter of Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, FCC Report and Order, CG Docket No , 18 FCC Rcd , (July 3, 2003). The Supreme Court has also recognized the FCC s role in issuing interpretative regulations under the TCPA and has deferred thereto. See Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 674 (2016) (deferring to FCC pronouncement regarding vicarious liability under the TCPA). PAGE 9 of 29 B. Defendants Business and the Underlying Misconduct. Peak is a provider of retail residential services, including apartments, to customers located across the country. As an ordinary business practice in operating its services, Peak collects the telephone numbers of its customers, which it then uses as part of its text calling operation to contact such individuals for various reasons, including renewal of apartment leases. Specifically, Peak, through its vendors including ICIM, sent text message advertisements to its customers telephone numbers for purposes of renewing leases, customer service follow up, telemarketing, and other calls relating to the services and products provided by Peak. 4 However, certain deficiencies in Defendants text message operating procedures have led to calls periodically being placed to individuals such as Plaintiff who did not provide written consent to receive such calls. 4 Peak asserts that it has ceased all text message advertising and has agreed to no longer advertise to its residents in this manner. 3

10 Such was the case with Plaintiff Truong, who, starting in October 2014, received several automated text messages on his cell phone soliciting Peak s services, even though Plaintiff had never informed Defendants that he wanted to receive any phone calls or text messages from them. III. THE LITIGATION On July 25, 2016, Plaintiff Truong filed a Class Action Complaint against Defendant Peak in the Circuit Court of Cook County, Illinois, Chancery Division, alleging violations of the TCPA for receiving unauthorized text message advertisements promoting Peak s student housing properties. On October 12, 2016, Plaintiff filed his First Amended Class Action Complaint, adding Realpage, Inc., d/b/a Indatus, as an additional defendant for its role in creating the text message marketing campaign and actually sending the unauthorized text messages at issue. 5 Shortly after PAGE 10 of 29 the filing of the initial Complaint, Defendant Peak hired capable and experienced defense counsel to litigate this matter and defend the claims. ICIM, though not yet formally a party to the Lawsuit, did the same. On December 2, 2016, Defendant Peak filed its Motion to Dismiss Plaintiff s First Amended Complaint ( Motion to Dismiss ), raising five separate arguments in an attempt to dismiss Plaintiff s case. Peak first argued that the text messages Plaintiff received were not advertisements under the TCPA such that it only needed to obtain prior express consent to place them. Peak s second argument, closely tied to its first argument, was that Peak obtained Plaintiff s prior express consent when he provided his cell phone number at some point during the lease application process. Peak s third argument, which relied largely on the United States Supreme Court s recent decision in Spokeo, Inc., v. Robins, 136 S.Ct (2016), was that Plaintiff did not 5 Due to a misnomer, Plaintiff subsequently substituted the new owner of Indatus, Defendant ICIM, for RealPage by stipulation of the Parties. 4

11 have standing to pursue a claim under the TCPA because he did not suffer a concrete injury and that a violation of the TCPA does not itself constitute a harm that provides standing. In addition to these arguments, Peak also argued that it had no liability for the allegedly unauthorized text messages, claiming that it cannot be held directly or vicariously liable. Peak argued that it cannot be held directly liable because it itself did not physically make the calls as Indatus handled the technical aspects of actually sending the messages and that it cannot be held vicariously liable because Indatus was not its agent. Peak finally argued that Plaintiff failed to allege that the text messages were sent using an Automatic Telephone Dialing System (ATDS), as required to state a cause of action under the TCPA. ICIM suggested that it would also file a motion to dismiss involving similar arguments. PAGE 11 of 29 Shortly after filing its Motion to Dismiss, Peak made a settlement offer on an individual basis to Plaintiff. Plaintiff rejected the settlement offer and instead responded to the arguments in the Motion to Dismiss. Prior to filing a Reply in support of the Motion to Dismiss, and given the strength of the arguments raised by Plaintiff in opposition to that Motion, the significant expenses that Defendants would incur during merits and class discovery, as well as the uncertainty of potentially facing liability on a class basis after a motion for class certification was to be ruled upon, Defendants agreed to mediate the claims on a class-wide basis. In the spring of 2017, Plaintiff s counsel met with both corporate representatives and outside counsel for Peak for a full-day mediation session with the Hon. Morton Denlow (ret.), a former Magistrate Judge of the United States District Court for the Northern District of Illinois with significant expertise in TCPA class settlements and a reputation for bringing litigants together despite significant differences. After a full day of contentious negotiations involving significant disputes between the Parties as to the value of the relief to be provided to the class members and 5

12 the strengths and weaknesses of each sides positions, the Parties were unable to reach any settlement agreement. Several weeks later, the Parties agreed, with the assistance of Judge Denlow, to continue discussions and discover whether a common ground for a settlement could be reached. The Parties continued to discuss the potential for settlement through a number of telephone conferences and informal negotiations over the next two months with Judge Denlow and with each other, before finally reaching an agreement in principal to resolve the case. In the months that followed, counsel for Plaintiff and for Defendants expended significant efforts in conducting further confirmatory inquiries regarding the scope of Peak s text message advertising, identifying potential class members, and finalizing the form of notice that was to be provided to class members as well as the PAGE 12 of 29 scope of the release and settlement benefits. Eventually, these discussions culminated in the class action Settlement Agreement that was preliminarily approved by the Court. IV. THE SETTLEMENT The culmination of Class Counsel s labor is a Settlement that provides a tremendous direct monetary benefit to the Settlement Class Members. The Settlement establishes a $7,000,000 cash Settlement Fund. (Settlement Agreement, Ex. A, at 3.) Each Settlement Class Member who submits a valid Claim Form will be entitled to an equal share of the Settlement Fund, up to $100.00, after payments are first made for notice and administration costs, Court-approved attorneys fees and expenses, and a Court-approved incentive payment to the Class Representative. (Id. 3, 8(a).) The total payment to each Settlement Class Member will depend on the number of valid Claim Forms submitted. Direct Notice was provided by First-Class Mail and ed to over 46,000 of Peak s customers. (Id. 3.1(a); Declaration of Michael J. McMorrow, attached hereto 6

13 as Exhibit B, at 14.) In addition, as of December 15, 2017, the Notice Plan implemented by the Parties has already resulted in over 1.2 million impressions on social media and over 3,600 unique visits to the Settlement Website and will have reached more than 95% of all Settlement Class Members. (See Notice Plan Outline, attached as Exhibit B to Settlement Agreement; McMorrow Decl., Ex. B, 14.) As a result of the extensive Notice Plan implemented by the Parties, as of December 15, 2017, over 3,600 Claims have already been received by the Settlement Administrator, (id.) with nearly a month remaining in the claims period. V. THE COURT SHOULD APPROVE THE UNOPPOSED ATTORNEYS FEES AND EXPENSES BECAUSE THEY ARE REASONABLE Pursuant to the Settlement, Class Counsel seek attorneys fees and costs in the amount of PAGE 13 of 29 $2,323,333.00, which constitutes slightly less than one-third of the Settlement Fund. (Settlement Agreement, Ex. A, at 10.) Plaintiff respectfully requests that the Court award the attorneys fees and Incentive Award sought by Class Counsel, and unopposed by Defendants, as they are fair and reasonable in light of the work performed by Class Counsel and the recovery secured on behalf of the Settlement Class Members. It is well-settled that attorneys who, by their efforts, create a common fund for the benefit of a class are entitled to reasonable compensation for their services. See Wendling v. S. Ill. Hosp. Servs., 242 Ill.2d 261, 265 (2011) (citing Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980) ( a litigant or a lawyer who recovers a common fund for the benefit of persons other than himself or his client is entitled to a reasonable attorney s fee from the fund as a whole )). Indeed, courts strongly encourage negotiated fee awards in class action settlements. See Hensley v. Eckerhart, 461 U.S. 424, 437 (1983) ( A request for attorneys fees should not result in a second major litigation. Ideally, of course, litigants will settle the amount of the fee. ) The Illinois Supreme Court has adopted the approach taken by the majority of Federal courts on the issue of attorney 7

14 fees in equitable fund cases. Baksinski v. Northwestern Univ., 231 Ill. App. 3d 7, 13 (1st Dist. 1992) (citing Fiorito v. Jones, 72 Ill.2d 73 (1978)). That is, where, as here, an equitable fund has been created, attorneys for the successful plaintiff may directly petition the court for the reasonable value of those of their services which benefited the class. Id. at 14 (citing Fiorito, 72 Ill.2d 73). This rule is based on the equitable notion that those who have benefited from litigation should share in its costs. Sutton v. Bernard, 504 F.3d 688, 691 (7th Cir. 2007) (citing Skelton v. Gen. Motors Corp., 860 F.2d 250, 252 (7th Cir. 1988)). In deciding an appropriate fee in such cases, the Illinois Supreme Court has determined that a trial judge has discretionary authority to choose a percentage[-of-the-fund] or a lodestar method[.] Shaun Fauley, Sabon, Inc. v. Metro. Life Ins. Co., 2016 IL App (2d) , 58 PAGE 14 of 29 (citing Brundidge v. Glendale Federal Bank, F.S.B., 168 Ill.2d 235, (1995)). Under the percentage-of-the-fund approach, the attorneys fees awarded are based upon a percentage of the amount recovered on behalf of the plaintiff class. Brundidge, 168 Ill.2d at 238. When applying the lodestar approach, the attorneys fees to be awarded are calculated by determining the total amount of hours spent by counsel in order to secure the relief obtained for the class at a reasonable hourly rate, multiplied by a weighted risk multiplier that takes into account various factors such as the contingency nature of the proceeding, the complexity of the litigation, and the benefits that were conferred upon the class members. Id. at 240. However, the vast majority of courts presiding over settlements in suits brought pursuant to the TCPA have adopted the percentage-ofthe-fund method in determining the appropriate amount of attorneys fees to award class counsel. See, e.g., In re Capital One Tel. Consumer Prot. Act Litig., 80 F. Supp. 3d 781, 794 (N.D. Ill. 2015) (finding that even though in common fund cases like this one, district courts have discretion to choose either the lodestar or a percentage approach to calculating fees[,] the court agrees with 8

15 Class Counsel that the fee award... should be calculated as a percentage of the money recovered for the class ); Sabon, 2016 IL App (2d) , at 59 (affirming trial court s award of attorneys fees in TCPA suit of 33% of the settlement fund); Sterk v. Path, Inc., No CH (Cir. Ct. Cook County) (Hon. Mary L. Mikva) (final approval granted on Sep. 21, 2015) (awarding class counsel 35% of settlement fund in a TCPA class action); Sawyer et al. v. Stericycle, Inc. et al., No CH (Cir. Ct. Cook County) (Hon. Leroy K. Martin, Jr.) (final approval granted on Aug. 27, 2015) (awarding class counsel 33% of settlement fund in a TCPA class action); Kolinek v. Walgreen Co., 311 F.R.D. 483, 500 (N.D. Ill. 2015) ( [t]he Court agrees with [plaintiff s] counsel that the fee award in this case should be calculated based on a percentage-of-the-fund method ); Wright v. Nationstar Mortage LLC, No. 14-cv-10457, U.S. Dist. LEXIS , at *53 PAGE 15 of 29 (N.D. Ill. Aug. 29, 2016) ( the baseline rate in TCPA common fund cases is 30% of the first $10 million of recovery ) (citing In re Synthroid Mktg. Litig., 325 F.3d 974, 980 (7th Cir. 2003)); Landsman & Funk, P.C. v. Skinder-Strauss Associates, 639 F. App x 880, 883 (3d Cir. 2016) (approving a one-third percentage fee of the settlement fund in a TCPA case). Applying a percentage-of-the-fund approach is also most appropriate because it best reflects the fair market price for the legal services provided by the class counsel. See Ryan v. City of Chicago, 274 Ill. App. 3d 913, 923 (1st Dist. 1995) (noting that a percentage fee was the best determinant of the reasonable value of services rendered by counsel in common fund cases ) (citing Court Awarded Attorney Fees, Report of the Third Circuit Task Force, 108 F.R.D. 237, (3d. Cir. 1985)); Sutton, 504 F.3d at 693 (directing district court on remand to consult the market for legal services so as to arrive at a reasonable percentage of the common fund recovered). In addition, applying the percentage-of-the-fund approach promotes early resolution of the matter as it disincentivizes protracted litigation driven solely by plaintiff s counsel s efforts to increase 9

16 their lodestar. Brundidge, 168 Ill.2d at 242. This is closely related to why applying a percentageof-the-fund method best aligns the interests of the class and its counsel, as class counsel are encouraged to seek the greatest amount of relief possible for the class rather than simply seeking the greatest possible amount of attorney time regardless of the ultimate recovery obtained for the class. Finally, unlike under a percentage-of-the-fund approach, a lodestar approach encourages significant inefficiencies and further litigation as the parties and the court have to review the extensive billing records produced and determine the reasonableness of the time spent on any particular task and whether it furthered the litigation. Ryan, 275 Ill. App. 3d at 924 ( Percentage analysis approach eliminates the need for additional major litigation... as a result of plaintiffs PAGE 16 of 29 request for attorneys fees... nearly half of the 11,000 page record in this case is devoted to fee litigation. ) In this case for example, a lodestar approach would have encouraged Class Counsel to reject the settlement offer embodied in the Settlement Agreement merely to ensure that additional litigation would lead to higher hours an attitude that could have resulted in no recovery to the Settlement Class Members at all. Plaintiff thus respectfully requests that this Court apply the percentage-of-the-fund method for calculating the attorneys fee to be awarded to Class Counsel in this matter. Applying a percentage-of-the-fund approach would most fairly compensate Class Counsel for the significant time and resources expended in obtaining the relief for the Settlement Class, while taking into account the substantial risk of non-payment assumed in bringing this litigation as well as the magnitude of the recovery achieved for the Class Members. Such an approach also accurately reflects the contingent nature of the fees negotiated between Class Counsel and Plaintiff, who agreed ex ante that 33% of any settlement fund plus reimbursement of costs and expenses would 10

17 represent a fair award of attorneys fees from a fund recovered for the class. (McMorrow Decl., 12.) In reaching an understanding on fees by the Parties, Plaintiff agreed not to seek more than such amount, which would otherwise be his right, and Defendants agreed not to oppose a request for such amount. In addition, an award of 33% of the common fund secured for the class is well within the range of attorneys fees awards found reasonable by other courts in Illinois. See, e.g., Sabon, 2016 IL App (2d) , at 59, 65 (affirming over objections attorneys fee award of 33% of the fund); Retsky Family Ltd. P ship v. Price Waterhouse LLP, No. 97-cv-7694, U.S. Dist. LEXIS 20397, at *10 (N.D. Ill. Dec. 10, 2001) (noting that a customary contingency fee ranges from 33 1/3% to 40% of the amount recovered ) (citing Kirchoff v. Flynn, 786 F.2d 320, 324 (7th Cir. 1986)); Schulte v. Fifth Third Bank, 805 F.Supp.2d 560, 599 (N.D. Ill. 2011) (same). Finally, PAGE 17 of 29 it has been noted that, even under the lodestar approach, attorneys fee awards still average approximately one-third of the common fund recovered for the class. William B. Rubenstein, Newberg on Class Actions 14:6 (4th ed.) ( Empirical studies show that, regardless whether the percentage method or the lodestar method is used, fee awards in class actions average around onethird of the recovery. ) Accordingly, Plaintiff and Class Counsel request that the Court adopt the percentage-of-the-fund approach and award 33.1% of the Settlement Fund as attorneys fees and costs. A. The Requested Fees Represent 33% of the Common Benefit Provided to the Class a Percentage Consistent with the Range Found Reasonable by the Courts. The fee requested in this case equals 33% of the cash common fund created under the Settlement, a figure widely recognized as reasonable. 6 See, e.g., Ryan, 274 Ill. App. 3d at Included in this amount, or such other amount awarded by the Court, Class Counsel have expended $19, in reimbursable expenses related to filing, mediation, expert fees, copying, and case administration, with the potential of more expenses yet to come. (McMorrow Decl., Ex. B, at 15; Meyers Decl., Ex. C, at 21.) Courts regularly award reimbursement of the expenses counsel incurred in prosecuting the litigation. See, e.g., Kaplan v. Houlihan Smith & Co., No

18 (upholding on appeal an attorneys fee award of 33% of the fund); Sabon, Inc., 2016 IL App (2d) , at 24, 61 (upholding award of attorneys fees under the one-third percentage-of-theaward method in a TCPA case); Sterk, No CH (approving attorneys fee award in TCPA case of 35% of the fund); Sawyer, No CH (approving attorneys fee award in TCPA case of 33% of the fund); see also Meyenburg v. Exxon Mobil Corp., No. 05-cv-15, U.S. Dist. LEXIS 52962, at *5 (S.D. Ill. July 31, 2006) ( 33 1/3% to 40% (plus the cost of litigation) is the standard contingent fee percentages in this legal marketplace for comparable commercial litigation ); Schulte, 805 F.Supp.2d at 599 ( a number of fee awards in common-fund cases from within the Seventh Circuit show that an award of 33.3% of the settlement fund is within the reasonable range ); Retsky, U.S. Dist. LEXIS 20397, at *10 ( a customary contingency fee would PAGE 18 of 29 range from 33 1/3% to 40% ). The attorneys fees sought in this case are particularly reasonable in light of the risks of bringing the litigation and the relief that Class Counsel have obtained for the Settlement Class. See Sabon, Inc., 2016 IL App (2d) , at 59 (upholding an attorneys fees award of onethird of a reverting fund recovered in light of the substantial risk in prosecuting this case under a contingency fee agreement given the vigorous defense of the case and defenses asserted by [the defendant] ); Ryan, 274 Ill. App. 3d at 924 (noting the trial court s decision to award class counsel 33 1/3% of the common fund was reasonable given the funds recovered for the class and the contingency risk). As noted in Capital One, the average TCPA case carries [just] a 43% chance of success. 80 F. Supp. 3d at 806. However, the prosecution of this case was particularly risky given the cv-5134, U.S. Dist. LEXIS 83936, at *12 (N.D. Ill. June 20, 2014) (awarding expenses for which a paying client would reimburse its lawyer ); Spicer v. Chicago Bd. Options Exch., Inc., 844 F. Supp. 1226, 1256 (N.D. Ill. 1993) (detailing and awarding expenses incurred during litigation). 12

19 numerous defenses presented by Defendants. Specifically, Peak s initial offer of individual relief threatened any potential recovery either individually or on a class basis had Peak (or ICIM) succeeded in challenging Plaintiff s standing to pursue any individual or class claims. Furthermore, there is an appeal currently being brought before the D.C. Circuit Court of Appeals challenging whether text message calls such as the ones received by Plaintiff are even actionable under the TCPA. See ACA International v. Federal Communications Commission, No (D.C. Cir. 2015). But even setting aside Defendants defenses on the merits, Plaintiff would ultimately also have been required to succeed on a motion for class certification, the success of which would by no means have been guaranteed. See, e.g., Vigus v. S. Illinois Riverboat/Casino Cruises, Inc., 274 F.R.D. 229, 238 (S.D. Ill. 2011) (denying class certification in TCPA case); see PAGE 19 of 29 also Jamison v. First Credit Servs., Inc., 290 F.R.D. 92, (N.D. Ill. 2013) (same and collecting authorities). Clearly, this litigation presented multiple risks to Plaintiff s ultimate success, both on the merits and on class certification, and both Peak and ICIM would have further strenuously defended the claims asserted had this Settlement not been reached. Despite the significant risks posed to any further prosecution of the case, Class Counsel were able to obtain an excellent result for the Settlement Class Members. The Settlement Agreement provides for the creation of a $7,000,000 cash Settlement Fund from which Class Members can submit claims for a cash award of up to $ (Settlement Agreement, Ex. A, at 3.) The cash award being made available to the Settlement Class Members is on the high end of the range of class compensation in other TCPA settlements approved by courts where Class Counsel were awarded one-third of the total settlement fund. See, e.g., Sabon, 2016 IL App (2d) , at 59 (affirming award of attorneys fees of 33% ($7.6 million) of a reversionary common fund of $23 million from which class members received approximately $50 per claim); 13

20 Kolinek, 311 F.R.D. at 494, 503 (awarding attorneys fees award of 36% of an $11 million common-fund from which class members received approximately $30 per claim); Wright, 2016 U.S. Dist. LEXIS , at *27, *62 (awarding attorneys fees award of 30% of a $12.1 million common-fund from which class members received $45 each); Murray et al v. Bill Me Later, Inc., No. 12-cv-4789, (N.D. Ill. 2014) (awarding attorneys fees award of 33% of a $9.9 million common-fund from which class members received approximately $135 per claim). A fee award of 33% of the fund is especially reasonable here in light of Class Counsel s efforts in securing a settlement that has already resulted in such a significant number of claims being submitted. Although the Claims Deadline is not until January 6, 2018, as of December 15, 2017 more than 3,600 claims have already been filed by Settlement Class Members. (Declaration PAGE 20 of 29 of Evan M. Meyers, attached hereto as Exhibit C, at 14.) This amounts to over $360,000 in claims already submitted. Considering the rate at which claims have already been filed, and the very significant monetary award for each valid claim submitted, the total sum paid to Settlement Class members is expected to be significant. Accordingly, the Settlement reached by Class Counsel more than adequately compensates the injured Settlement Class Members and is also sufficiently significant to deter future wrongful conduct. Finally, Class Counsel note that, in addition to the monetary compensation that Class Counsel have obtained for the Settlement Class Members, Peak has already asserted that it has ceased all text message advertising to its residents and will not resume the practice. Given the scope of Peak s real estate business and the thousands of customers that it provides its services to across the country, implementing this ban has drastically reduced the number of text message calls placed to individuals who did not consent to receive them and resulted in the end of text message spam to its residents. Such non-monetary relief is also useful in determining whether the fee award 14

21 being sought is reasonable. See Spano v. Boeing Co., No. 06-cv-743, 2016 WL , at *1 (S.D. Ill. Mar. 31, 2016) ( A court must also consider the overall benefit to the Class, including non-monetary benefits, when evaluating the fee request ) (citing Beesley v. Int l Paper Co., No. 06-cv-703, 2014 U.S. Dist. LEXIS 12037, at *5 (S.D. Ill. Jan 31, 2014)). Accordingly, given the significant monetary compensation obtained for the Settlement Class Members a $7,000,000 fund providing for up to $ for every valid claim submitted and the changes in Peak s dialing practices implemented to avoid future TCPA litigation, an attorneys fees award of 33% of the Settlement Fund is reasonable and fair compensation particularly, as discussed above, in light of the substantial risk in prosecuting this case under a contingency fee agreement and the defenses asserted by [Defendants]. Sabon, Inc., 2016 IL PAGE 21 of 29 App (2d) , 59. B. The Requested Fees are Equally Appropriate Under the Lodestar Method. To the extent this Court has any concerns as to the value of the legal work performed by Class Counsel on behalf of the Settlement Class Members, the attorneys fees sought here are also reasonable and appropriate even when applying the lodestar method. In determining the amount of attorneys fees to be awarded pursuant to the lodestar method the first step is to multiply[] a reasonable hourly rate by the number of hours reasonably expended. Gastineau v. Wright, 592 F.3d 747, 748 (7th Cir. 2010) (citing Hensley, 461 U.S. at ); Brundidge, 168 Ill. 2d at 239 (noting that under the lodestar method the reasonable hours devoted by plaintiff s attorneys should be the starting point in assessing fees. ) A reasonable hourly rate should be in line with the prevailing rate in the community for similar services by lawyers of reasonably comparable skill, experience and reputation. Jeffboat, LLC v. Director, Office of Workers Comp. Programs, 553 F.3d 487, 489 (7th Cir. 2009). Once the base lodestar is computed, the Court must adjust the 15

22 lodestar using a risk multiplier that takes into account the contingency nature of the proceeding, the complexity of the litigation, and the benefits [to]... the class. Sabon, Inc., 2016 IL App (2d) , 58 (citing Brundidge, 168 Ill.2d at ); see also Wright, 2016 U.S. Dist. LEXIS , at *57 ( [A] risk multiplier is not merely available in a common fund case but mandated, if the court finds that counsel had no sure source of compensation for their services ) (citing Florin v. Nationsbank of Georgia, N.A., 34 F.3d 560, 565 (7th Cir. 1994)); Harman v. Lyphomed, Inc., 945 F.2d 969, (7th Cir. 1991) (remanding case for recalculation of attorneys fees because the trial court failed to award a risk multiplier). Typical multipliers awarded in comparable class action litigation average around 3 4, but are often much higher. See Sabon, Inc., 2016 IL App (2d) , 59 (noting that a multiplier PAGE 22 of 29 of 2.97 was well within the range of multipliers used in other common-fund cases and that some courts have awarded multipliers as high as 19.6 ); Spano, 2016 WL , at *3 ( Courts have generally held that a lodestar multiplier falling between 2 and 4.5 demonstrate a reasonable attorney s fees ) (internal citations omitted); Beverly Bank v. Bd. of Review of Will Cty., 193 Ill. App. 3d 130, 137, 142 (3rd Dist. 1989) (upholding trial court s decision to award a 2.5 multiplier to account for the substantial contingent risk inherent in th[e] case. ) Here, Class Counsel s lodestar is reasonable; the success obtained for the Settlement Class, given the risk taken in prosecuting this case, amply justifies the modest multiplier requested. As detailed in the attached Declarations, Class Counsel s lodestar 7 is $800, (Meyers Decl., Ex. C, at 20 21; McMorrow Decl., Ex. B, at 10.) The hourly rates utilized by Class Counsel are comparable to rates charged by attorneys with similar experience, skill and reputation, for similar 7 Prior to submission, Class Counsel reviewed the hours expended by the attorneys and staff on this case and reduced any hours deemed duplicative or excessive. (Meyers Decl., Ex. C, at 19; McMorrow Decl., Ex. B, at 10.) 16

23 services in the Chicago legal market. Meyers Decl., Ex. C, at 19 20; McMorrow Decl., Ex. B, at 10; In re: Sears, Roebuck & Co. Front-loading Washer Prod. Liab. Litig., No. 06-cv-7023, U.S. Dist. LEXIS , at *50 (N.D. Ill. Sept. 13, 2016) (evaluating attorneys fees petition and finding that hourly rates of $800 per hour for class counsel with 23 years of experience and $515 per hour for class counsel with 9 years of experience in line with those prevailing in the community ); Payton v. Kale Realty, LLC, No. 13-cv-8002, U.S. Dist. LEXIS , at *24 (N.D. Ill. Aug. 20, 2015) (approving in a TCPA class action suit a partner rate of $550 per hour and an associate rate of $400 per hour ); Murray et al. v. Bill Me Later, Inc., No. 12-cv-04789, Dkt. 78 (N.D. Ill. Nov. 20, 2014) (approving billable rates in TCPA class action settlement of $650, $625, and $595 for Chicago-based partners); Seal et al. v. RCN Telecom Svcs., No. 16-CH- PAGE 23 of (Cook Co., Feb. 24, 2017) (approving billable rates in TCPA class action settlement of $670, $650, and $620 for Chicago-based partners). Further, several state and federal courts, including the Circuit Court of Cook County and the Northern District of Illinois, have previously approved the then-current hourly rates of Class Counsel as reasonable. (Meyers Decl., Ex. C, at 19; McMorrow Decl., Ex. B, at 13.) The fact that this and other courts have approved the hourly rates submitted by Class Counsel is indicative that they are reasonable and correspond to the market rate. See People Who Care v. Rockford Bd. of Educ., Sch. Dist. No. 205, 90 F.3d 1307, 1312 (7th Cir. 1996) ( rates awarded in similar cases are clearly evidence of an attorney s market rate. ) It is also apparent that a multiplier to the base lodestar is warranted in this case. Class Counsel undertook significant risk in proceeding with this litigation. Defendants liability to Plaintiff was far from clear, and Class Counsel agreed to commence this litigation knowing they would assuredly face significant opposition from a defendant with the financial resources of Peak 17

24 and ICIM. (Meyers Decl., Ex. C, at 17; McMorrow Decl., Ex. B, at 11.) Indeed, shortly after appearing in the case Peak promptly moved to dismiss each of the original and the Amended Complaints in this matter, raising five separate arguments in an attempt to dismiss Plaintiff s case. ICIM suggested that it would also file a Motion to Dismiss involving similar arguments. Importantly, shortly after filing its Motion to Dismiss Peak also made a settlement offer on an individual basis to Plaintiff, providing it yet another basis to seek dismissal. Plaintiff rejected the settlement offer and instead responded to the arguments in the Motion to Dismiss. Had this case not settled, Peak and ICIM made clear they would have proceeded with their motion practice. This is not to mention that Peak and ICIM would have also challenged any efforts at class certification, which would already have been particularly difficult given the nature of the claims PAGE 24 of 29 asserted by Plaintiff and the difficulty of identifying a class of individuals who received the type of unauthorized text message calls at issue here. (Meyers Decl., Ex. C at 11; McMorrow Decl., Ex. B, at 11.) Nonetheless, despite a significant risk of Defendants prevailing either on the merits or in defeating class certification which would have resulted in Class Members receiving nothing Class Counsel achieved an excellent result for the Settlement Class in obtaining a $7,000, Settlement Fund and the ability to receive $ in compensation for validly filed claims. Class Counsel were able to achieve these results solely due to their extensive efforts in investigating and analyzing novel issues relating to Peak and ICIM s automated text message operation and how Peak reached out to its customers; identifying potential Settlement Class Members; researching and litigating the numerous legal arguments raised by Peak, including a number of novel arguments not raised in other TCPA cases involving the type of renewal messages that Mr. Truong and some of the other class members received; and, critically, productively mediating this case and negotiating the final Settlement Agreement. (Meyers Decl., 18

25 Ex. C, at 13; McMorrow Decl., Ex. B, at 9.) Given the significant efforts needed to secure the Settlement in this action, Class Counsel would not have brought this action absent the prospect of obtaining a percentage of the fund or a significant multiplier of their actual fees expended to account for the risk inherent in this type of class action. (Meyers Decl., Ex. C, at 17; McMorrow Decl., Ex. B, at 11.) The lodestar submitted by Class Counsel here reflects the significant efforts taken by Class Counsel to obtain the $7,000, Settlement Fund created for the benefit of the Settlement Class Members, along with the substantial $ in compensation made available for each valid claim made. And the lack of opposition to date with just one invalid objection filed indicates that the Settlement Class Members overwhelmingly support that result. Furthermore, Class PAGE 25 of 29 Counsel anticipate expending substantial additional time and effort through Final Approval and beyond in order to respond to inquiries from Class Members generated by the extensive Notice Plan, respond to any potential objectors, prepare Final Approval papers, review any claims rejected by Defendants and/or the Settlement Administrator, and advocate on behalf of the Settlement Class Members if a claim is wrongfully denied. (Settlement Agreement, Ex. A, at 6.3.) Class Counsel conservatively estimate that the additional lodestar for such efforts will, collectively, be approximately $62,000. (Meyers Decl., Ex. C, at 21; McMorrow Decl., Ex. B, at 14.) 8 In short, Class Counsel s lodestar of $800,911 requires a multiplier of 2.8 after costs are deducted and is reasonable given the efforts expended, the results obtained, and the relief made available to the Settlement Class. Ultimately, regardless of whether this Court looks to the percentage-of-the-fund method or the lodestar method, the attorneys fees award sought by Class Counsel here is reasonable and 8 Calculated based on the average hourly rate multiplied by the average amount of time Class Counsel estimates they will have to expend through final approval. 19

26 justified in light of Class Counsel s efforts, the risk involved in undertaking and prosecuting this litigation, and the significant recovery obtained on behalf of the Settlement Class Members. Importantly, the requested fee award is well within the range of attorneys fees awarded by numerous other Illinois state and federal courts and is consistent with what the market would award. Accordingly, this Court should award Plaintiff s Counsel the requested fee and expense award of $2,323, VI. THE COURT SHOULD APPROVE THE UNOPPOSED INCENTIVE AWARD Because a named plaintiff is essential to any class action, [i]ncentive awards are justified when necessary to induce individuals to become named representatives. Spano, 2016 WL , at *4 (internal citation omitted) (approving incentive awards of $25,000 and $10,000 for PAGE 26 of 29 class representatives); GMAC Mortg. Corp. of Pa. v. Stapleton, 236 Ill. App. 3d 486, 497 (1st Dist. 1992) (noting that incentive awards are not atypical in class action cases... and serve to encourage the filing of class actions suits. ) In addition, agreeing to serve as Class Representative meant that Plaintiff William Truong publicly placed his name on this suit and opened himself to scrutiny and attention which, in and of itself, is certainly worthy of some type of remuneration. See Schulte, 805 F. Supp. 2d at Here, Plaintiff s efforts and participation in prosecuting this case easily justify the $15,000 Incentive Award sought for Mr. Truong. Even though no award of any sort was promised to Mr. Truong prior to the suit being filed or at any time thereafter (see Meyers Decl., Ex. C, at 26), he nonetheless contributed his own time and effort in pursuing his individual claims, as well as the action on behalf of the Settlement Class exhibiting a willingness to participate and undertake the responsibilities and risks attendant with bringing a representative action. (see Meyers Decl., Ex. C, at ) Plaintiff participated in the initial investigation of the action and provided his personal cell phone records to Class Counsel to aid in preparing the initial pleadings and any future 20

27 discovery, reviewed the pleadings prior to filing, consulted with Class Counsel on numerous occasions, and provided feedback on a number of other filings including, most importantly, the Settlement Agreement. (see Meyers Decl., Ex. C, at ) Were it not for Plaintiff s willingness to bring this action on a classwide basis, his efforts and contributions to the litigation by assisting Class Counsel with their investigation and filing of the suit, and his continued participation and monitoring of the case up through settlement, the substantial benefit to the Class afforded under this Settlement Agreement would not have resulted. (see Meyers Decl., Ex. C, at 25.) Further, the Incentive Award sought by Plaintiff here is reasonable and well within the range of other incentive awards provided to class representatives in similar class actions, including PAGE 27 of 29 those involving the TCPA. The $15,000 Incentive Award for Plaintiff requested here makes up just 0.2% of the total Settlement Fund well in line with the average incentive award granted in class actions. See, e.g., Craftwood Lumber Co. v. Interline Brands, Inc., No. 11-cv-4462, U.S. Dist. LEXIS 35421, at *19 (N.D. Ill. Mar. 23, 2015) ( a study on incentive awards for class action plaintiffs (also conducted by Eisenberg and Miller)... found that the mean incentive fee granted in class actions overall is.161% [of the total recovery] ) (citing Eisenberg & Miller, Incentive Award to Class Action Plaintiffs: An Empirical Study, 53 U.C.L.A. L.Rev. 1303, 1339 (2006)). Reducing each Settlement Class Member s maximum potential claim by just a few cents (approximately $.32 at most) to compensate Plaintiff for the risks and efforts he undertook to benefit the Settlement Class as a whole is more than reasonable under the circumstances of this case and especially in light of the results obtained. In fact, numerous courts that have granted final approval in similar TCPA settlements have awarded significantly larger incentive awards than the one sought here. See, e.g., Craftwood Lumber Co., U.S. Dist. LEXIS 35421, at *20 (awarding 21