UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

Transcription

1 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 1 of 11 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK THE DIAL CORPORATION, et al., Individually and on behalf of Similarly Situated Companies, Plaintiffs, Civil Action No. 1 3-cv WHP v NEWS CORPORATION, et al., Defendants DECLARATION OF JAMES T. SOUTHWICK IN SUPPORT OF MOTION FOR AWARD OF ATTORNEYS' FEES, REIMBURSEMENT OF EXPENSES, AND INCENTIVE AWARDS

2 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 2 of 11 James T. Southwick declares as follows: 1. I am a paftner in the law firm Susman Godfrey LLP and serve as co-lead counsel to the certified class in this case along with Steve Benz of the Kellogg Huber firm. I submit this declaration in support of co-lead counsel's application for an award of attorneys' fees, reimbursement of expenses, and incentive awards to the class representatives. I make this declaration from personal knowledge and based on my review of the accounting records of Susman Godfrey. If called as a witness, I would testify to the matters stated herein. Experience in Complex Litigation 2. Since graduating from Syracuse University College of Law in 1989, I have continually practiced commercial litigation, first as a litigation associate with Breed Abbott & Morgan in New York City and then with Susman Godfrey in Houston, Texas since I became a partner at Susman Godfrey in I represent both plaintiffs and defendants in complex commercial cases, including but not limited to antitrust, unfair competition, and class actions, in federal and state courts throughout the United States. I am admitted to practice in the states of New York and Texas and various federal courts, including the U.S. District Court for the Southern District of New York, where I was admitted in My professional biography listing representative cases is available at Southwick. I have tried to verdict two antitrust class actions as plaintiffs' co-lead class counsel: In re Vitamin C Antitrust Litigation in the Eastern District of New York and In re Vitamins Antitrust (Choline Chloride) in the District of the District of Columbia. 3. Susman Godfrey is a firm of 107 lawyers with offrces in Houston, New York City, Los Angeles, and Seattle. Since its inception in 1980, the firm's practice is exclusively -l-

3 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 3 of 11 commercial litigation and the firm is consistently ranked by the legal media as one of the top litigation boutiques in the country, Susman Godfrey actively and currently handles antitrust and class actions in the Southern District of New York and other courts around the country. For example, Susman Godfrey currently serves as co-lead counsel in In re: Libor-based Financial Instruments Antitrust Litigation, U.S. District Court, Southern District of New York, No. 11-md Detailed information about Susman Godfrey, its practice, its attorneys, its approach to handling cases, and its experience in antitrust and class actions is available at www. susm an go dfrey. co m, 4. Unlike many larger, full-service law firms, Susman Godfrey has roughly the same number of partners as non-partners. As of June 2016, the f,rrm has 54 partners, 42 associates, and 11 staff attorneys. We eschew the approach of having multiple associates feed work upstream for review by a smaller number of more senior lawyers because that approach, in our view, is often inefficient, Rather, in keeping with the firm's Texas-rooted ethos of "one riot, one ranger" we typically assign one lawyer primary responsibility for each task based on who is able to competently complete the task with as little oversight as possible. We think this leads to efficient use of lawyers' time and is reflected in Susman Godfrey's time relative to other firms. Because we are not leveraged on a pyramid model, Susman Godfrey partners often perform tasks, such as legal research, that would be assigned to associates at traditional ftrms, our associates often appear in roles that larger firms reserve for senior partners, and our associates are expected to actively participate in devising and enacting the strategy and tactics of the case. 5, Susman Godfrey handles cases under a broad range of fee structures, including traditional hourly billing, flat fees, pure contingent fees, and mixes of flat and contingent fees. When we negotiate pure contingent fee agreements, the contingent percentage almost always a

4 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 4 of 11 increases as the case progresses and milestones are reached. For example, in a typical private, non-class contingent affangement with the client paying expenses, our contingent fee will be 30% through the close of discovery, 35Yo atjury selection, and 40Yo after a jury verdict. Those percentages typically increase to if Susman Godfrey is paying expenses. We often negotiate additional or different milestones, but almost always the contingent percentage increases as the case progresses and the risk and labor undertaken correspondingly increases, 6. Susman Godfrey maintains a schedule listing the hourly billing rate for each attorney and legal assistant for the current calendar year. Each December the hourly rate schedule is reviewed and revised as appropriate. The revised schedule remains in effect from January through December of the following calendar year. A copy of the ftrm's 2016 rate schedule is attached hereto as Exhibit 6. Susman Godfrey only rarely deviates from the rate schedule for clients paying on an hourly basis. 7. Clients that wish to retain Susman Godfrey on an hourly billing basis are provided and sign our standard fee agreement, which sets forth both the hourly rates for each attorney in the f,rrm and the type of expenses that will be charged to the client throughout the engagement. These categories of expenses include travel, computerized legal research, outside photocopying, third-party document database management, etc. The categories of expenses for which we seek reimbursement on this motion are categories for which Susman Godfrey routinely bills its hourly clients. Role and Conduct of this Litigation 8. I became involved in this litigation in May 2013 when Steve Benz approached my firm about joining Kellogg Huber and Steve Berry as counsel for the plaintiffs. After investigating the claims for several weeks, Susman Godfrey signed a Joint Representation and -J-

5 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 5 of 11 Administration Agreement with plaintiffs H.J, Heinz, Henkel Corporation, Foster Poultry Farms, Smithdale Foods Inc., HP Hood LLC, Spectrum Brands Inc., and Bob Evans Farms LLC, and with the Kellogg Huber, Berry Law, McKool Smith, and Paul Hastings firms as co-counsel. Following the Court's class certification ruling in June 2015, Susman Godfrey was named colead counsel for the class along with Kellogg Huber. g. Susman Godfrey represents the plaintiffs and the class in this case on a purely contingent-fee basis with the firm advancing its share of expenses out of its partners' capital and without any third-party funding. The time Susman Godfrey lawyers devoted to this matter could readily have been devoted to other legal work for which the firm would have been compensated. 10. Along with the lead lawyers at the co-counsel firms (Steve Benz of Kellogg Huber, Lew LeClair of McKool Smith, Dan Goldman of Kramer Levin and Paul Hastings, and Steve Berry of Berry Law) I tried to organize and run the case effrciently. To that end, we undertook the following steps: o At the outset of Susman Godfrey's participation, we divided discovery responsibilities for each client among the co-counsel firms, with only one law firm assigned to each plaintiff. Susman Godfrey was particularly responsible for issues involving Foster Farms and BEF (Bob Evans Farms), including gathering and producing these clients' documents, working with the clients to prepare interrogatory answers, and preparing and presenting witnesses at depositions.. We held a standing weekly conference call every Tuesday morning at 10:30 a.m. ET among the lawyers working on the case. On this call, we reviewed the progress of ongoing tasks, discussed latest developments, and assigned new tasks. -4-

6 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 6 of 11 o Discrete tasks, such as drafting a brief or taking a deposition, were assigned to one of the firms, or occasionally to a particular lawyer. o For some major, time-intensive projects, such as reviewing the more than 1 million s produced after the discovery cutoff, responsibilities were divided across multiple frrms, but with a goal of avoiding duplication and trying to assign work to the firm with the best knowledge of a particular factual aspect of the case I have worked on several class actions in my career and in my experience, this group of 5 law firms and Mr. Beny (a solo practitioner) worked this class action efficiently, particularly when compared to class actions that trail in the wake of govemment investigations and indictments. In particular, in this case there were not dozens of law firms filing complaints, there was no MDL, there were no challenges for leadership positions, and there was no plethora of committees comprised of firms without leadership positions. Rather, this case was conducted by a small number of firms who stayed in close and regular contact and endeavored to avoid duplication of efforl by dividing tasks among themselves in a considered manner' Attorney Time In This Case 12. I reviewed the contemporaneously prepared time entries for all Susman Godfrey timekeepers working on this matter from our first involvement through June During this review I removed time entries not appropriately billed to the case, the entries for any timekeeper who billed less than 20 hours to the case, and time spent preparing this application for fees and expenses. The resulting billing by Susman Godfrey's timekeepers was 9,628.2 houts, with a corresponding lodestar, using our hourly rates, of 54,7 I7,7 52. The blended hourly rate for Susman Godfrey timekeepers is $490/hour. Using historic hourly rates, the resulting lodestar is S4,4g6,56L Eliminating the billings of timekeepers with less than 20 hours reduced the total -5-

7 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 7 of 11 hours by hours, or L5o/o of total hours. A summary of the hours by timekeeper is annexed hereto as Exhibit 1. The detailed time entries for all timekeepers that compose this lodestar is annexed hereto as Exhibit In my experience, this total number of hours and corresponding lodestar is entirely reasonable for the significant role my firm played in this case, which has been central to the leadership of the counsel group and advancement of Plaintiffs' claims. 14. The core team of Susman Godfrey personnel who worked on this case were myself, my partner Richard Hess, associate Ryan Caughey, staff attomey Mateo Fisher, and legal assistant Joanna Stanley. This core group accounts for more thant60/o of the hours Susman Godfrey billed to the case. 15. In addition to the core group, I also assigned tasks such as document review and straightforward legal research to several non-partnership track staff attorneys employed by Susman Godfrey (Kevin Hormann, Melissa Downey, Kristen Monkhouse). Also, as I deemed necessary, I enlisted the assistance of other Susman Godfrey partners (Jonathan Ross, Lindsey Eccles, Kathy Hoek) for discrete matters, such as particular depositions or in-depth research in opposition to summary judgment. A second associate, Brett Rosenthal, worked briefly on the case before leaving the firm. 16, In my role as lead Susman Godfrey lawyer and co-lead counsel for the class, I actively led the strategy discussions with co-counsel that determined the course we would take to trial and settlement of the class's claims, coordinated the responsibilities for discrete tasks among co-counsel, drafted and revised key pleadings, conferred with opposing counsel, and argued important motions in Court, including summary judgment, Defendants' request to negotiate individual deals with class members, and preliminary approval of the class settlement' I -6-

8 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 8 of 11 personally took the depositions of key witnesses, including defense expert on class certification and MIT professor Dr. Hausman, third-party witness Mr. Berg of Valassis, the last viable competitor in the ISP market, and News America's senior vice president for retail sales Dominic Hansa. Along with Steve Berry, I prepared plaintiffs' principal expert, Dr. Mackie-Mason for two depositions. Along with my Susman Godfrey colleagues, I prepared Dr. Mackie-Mason for his trial testimony and would have conducted his direct examination had the trial progressed to that point. I consulted with Dan Goldman and Lew LeClair about trial strategy while at the same time, with Steve Benz,personally handled the negotiation of the class-wide settlement. With Mr. Caughey, I prepared the preliminary approval motion and worked closely with Kellogg Huber to provide notice to the class. I continue to f,reld questions from class members and their claims gathering firms, and to work with the claims administrator to respond to inquiries and handle the claims process. 17. In addition to myself, the principal partner and associate lawyers at Susman Godfrey who worked on this matter are: o Ryan Caughey (2,359 hours), an associate, received his J.D. from Harvard Law School in 2008 and clerked for the Honorable Timothy Tymkovich of the Tenth Circuit. Prior to joining Susman Godfrey, Mr. Caughey was a litigation associate at Gibson Dunn & Crutcher LLP. Mr. Caughey was closely involved in drafting many briefs, including class certification and the opposition to summary judgment, took and defended multiple depositions (including News America's CEO Martin Garofalo, Defendants' liability expert (Dr. Kevin Murphy), and News America's Senior Vice President for Trade (Christina Bedell)), conducted and oversaw document review, corresponded with Defendants' counsel, argued -7 -

9 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 9 of 11 several motions in limine before the Court, and was principal point of contact with Foster Farms and Bob Evans Farms. o Richard Hess (1,061 hours), a partner, received his J.D. from University of Chicago Law School and clerked for the Honorable Lee Rosenthal of the United States District Court for the Southern District of Texas. Mr. Hess has spent his entire career since clerking at Susman Godfrey. Mr. Hess worked closely with Foster Farms and Bob Evans Farms in their document production and depositions, revised critical briefs, including those at class certification and summary judgment, conducted a trial examination of Robert Emmel (a key former employee of News America) at his deposition, prepared and negotiated proposed jury instructions, and consulted with me concerning all significant matters in this case o Jonathan Ross (646 hours), a partner, received his J.D. from Yale Law School in 1992 and clerked for the Honorable Lynn Hughes of the United States District Courl for the Southem District of Texas. Mr. Ross has spent his entire career since clerking at Susman Godfrey. I asked Mr. Ross to become involved during the discovery period to assist with the wave of depositions that were conducted during late2014 and Expenses 18. My f,rrm expended a total of $1,548, in costs and expenses in connection with the prosecution of this litigation through June A summary of these expenses is set forth in the chart attached hereto as Exhibit 3. This total included $259, in costs that my firm paid directly during the course of the case, plus monthly contributions to a joint litigation -8-

10 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 10 of 11 fund to which all Plaintiffs' Counsel contributed. The largest costs born directly by my firm were for travel, photocopying, and computerized legal research; smaller expenditures were for filing fees, transcripts, postage and delivery, telephone, and subpoenas. The individual entries for all these expense items as maintained by frrm's accounting system are attached hereto as Exhibit 4, 19. Susman Godfrey also paid a total of $1,288, in assessments to a joint litigation fund. Details of the litigation fund are set forth in the Declaration of David Okada, which is submitted with this motion. Each of the firms contributed to the litigation fund and received payments from the litigation fund in order to equalize the contributions made by each firm. 20. The expenses in Exhibits 3 and 4 were incurred on behalf by my firm on a contingent basis and are listed as actual costs with no administrative overhead applied. The expenses incurred in this action are reflected on the books and records of my firm and are prepared from expense vouchers, check records, and other source materials and they represent an accurate recordation of the expenses incurred. 21. In cases such as this in which Susman Godfrey is paying expenses, the firm enforces a policy as to what travel expenses will be reimbursed by the firm to an attomey and billed to the case. A copy of the version of this policy is annexed at Exhibit 5. Particularly applicable to the expenses incurred is this case are the provisions regarding hotels and airfare: o Absent exceptional circumstances, "the firm will reimburse actual hotel expenses, including customary fees and taxes, subject to the maximum base per-night rates for the following cities: $400 in New York City, V/ashington DC, Los Angeles and San Francisco (2) $350 in all other locations." -9-

11 Case 1:13-cv WHP Document 577 Filed 07/13/16 Page 11 of 11 o The firm will reimburse for airfare as follows: refundable, no-restriction economy airfare only (including intemational flights), unless refundable, no-restriction economy is unavailable or first/business class costs less than no-restriction economy. 22. I have discussed the reimbursement of travel expenses with my firm's accounting department and reviewed exemplars of travel expense reports submitted in this case. Those discussions and exemplars confirm that these policies were enforced and the expenses submitted with this declaration comport with these policies. 23. I have reviewed the expenses reported by my firm in this case which are included in this declaration, and I affirm that they are true and accurate to the best of my knowledge. 24. In my experience and judgment, the expenses incurred in this case were necessary to the advancement of the case and are reasonable for the services provided. I declare under penalty of perjury pursuant to 28 U.S,C.1746 that the foregoing is true and correct. Executed on July 12,2016, at Houston, Texas. James T. Southwick -10-