In one of the last hearings in local court regarding the Gibson’s Bakery v. Oberlin College case, Lorain County Common Pleas Judge John R. Miraldi heard evidence today on what the college owes in attorney’s fees.
As previously reported, Gibson’s signaled in court filings that it intended to seek $9-13 million, including a so-called lodestar.
A jury found last month that the college defamed the small business and its owners, and committed other torts, by helping distribute libelous claims of racial profiling. The same jury also awarded asked the judge to also award the plaintiffs attorney’s fees to be paid by Oberlin College, with the amount to be determined by the judge.
This is in addition to the $44 million they found Oberlin College owes the Gibson Bakery and Market. Verdict caps mandated by Ohio law have downgraded those initial verdicts down to $25 million, however.
Not surprisingly, at the hearing today each side had vastly different positions on the amount they thought was owed for attorney’s fees.
Each side gave the judge the number of billable hours they worked and the total compensation for those hours. Oberlin College’s attorneys have billed $4,932,199 for their work, though it’s unclear if that was paid by insurance companies or the college. But it was a measure of how much the defense lawyers put into the case. That is based on 15,626 billable hours.
By contrast, the Gibson’s lawyers worked 14,417 hours at a cost of $4,855,856 if using an hourly rate. The Gibson’s lawyers had the case on a 40% contingency fee, so the time records are being used as a measure, subject to multiplying under a “lodestar,” of what the legal fees would have been based on an hourly rate. The “lodestar” or “enhancements” format is meant to compensate lawyers who take cases on a contingency fee for the risk, when assessing a court award of reasonable attorney’s fees.
Each side also called their respective witnesses on the issue of reasonableness — local attorneys with a knowledge of what is reasonable in the in Northeast Ohio for handling such a case.
The expert for the Oberlin College side of the aisle, local attorney Eric Zagrans, told the court that the Gibson’s family and business did not need any more money. “The plaintiffs are made whole by the compensatory and punitive damages,” he said, adding that the damages the jury awarded “are more than sufficient to pay the attorney’s fees.”
Dennis Lansdowne, a local attorney testifying on behalf of the Gibson’s lawyers, pointed out that this was the largest defamation verdict in Ohio history, and told the court that the chance taken by bringing this case to court merits a larger fee. “If the Gibson family had to put money up front, and defamation cases are the most difficult cases to bring to court, they would not have been able to get the justice they deserve without their attorneys taking a big chance with the contingency fee arrangement,” Lansdowne said.
“This case involved a lot of complex legal issues and a commitment from the lawyer to pursue many angles,” he said. “This was not some slip and fall case.”
The judge will rule on how much Oberlin College needs to pay later, possible weeks from now.
But as usual in this case, there was much disagreement as too how much in fees for legal work is fair and appropriate. The attorneys for Gibson’s presented evidence that they should be receiving between $9-$14 million for their work, based on a multiple of their hourly rate, money that the family business wouldn’t have to pay from their verdict pot.
And the plaintiffs also expressed that such attorney’s fees paid by the defense should not be small because part of the purpose of such punitive payments is to be a reminder that they should not defame people and businesses again.
The college’s lawyer presented a view that the attorney’s fees awarded by the Judge John R. Miraldi (who presided over the case) should only between $2 and $2.25 million, if at all. They based that on a Zagrans’ testimony that he thought that Gibson’s attorneys spent too much on hotel expenses and their hourly rates that were way too high for a little town like Elyria, Ohio.
Lorain County, where the court case took place and where the town of Oberlin is located, is in the Cleveland area, which is the 33rd largest metro area in the country and has a population of around 2 million.
It’s interesting to compare these numbers to the 40% contingency fee arrangement. Both the Gibson’s lodestar analysis and the 40% contingency fee come in at around $10 – $12.5 million based on the $25 million judgement.
We will, of course, report on the judge’s decision on attorney’s fees as soon as it is rendered.
[Featured Image: Gibson’s Bakery Attorney Lee Plakas greets Allyn W. Gibson after punitive damages verdict][Photo credit Bob Perkoski for Legal Insurrection Foundation]
Daniel McGraw is a freelance writer and author in Lakewood, Ohio. Follow him on Twitter @danmcgraw1
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