The following papers were read on this motion pursuant to CPLR 2219(a): Papers Numbered NYSCEF DOC # Plaintiffs’ Motion for Attorneys’ Fees and other relief dated January 13, 2021; Attorney Affirmation of Damon J. Velardi, Esq., affirmed on January 13, 2021; Exhibits 1-6) 37-44 Defendant’s Motion for Reimbursement of Defendant Amida Care, Inc.’s costs of Notice Packet, dated January 28, 2021; Attorney Affirmation of Alexandra K. Skellet, Esq., affirmed on January 28, 2021; Exhibit A 46-47 Plaintiffs’ Attorney Affirmation of Damon J. Velardi, Esq., affirmed on August 25, 2021; Time Sheets. 72-73 Plaintiffs’ Attorney Affirmation of Doron Leiby, Esq., affirmed on August 25, 2021; Time Sheets 74-75 ORDER Prior Proceedings This is a class action for negligence, violations of HIPAA (42 U.S.C. 1320d) and NY Public Health Law 2782(1), breach of contract and invasion of privacy. The class members contend that defendant mailed them a document with language, visible from an envelope window, that indicated their HIV status. In motion sequence number 4, filed on January 13, 2021, plaintiffs moved this court, inter alia, for attorneys’ fees, based upon a one-third contingency fee, costs, and expenses. By order dated May 6, 2021, this court granted final approval of a settlement with a settlement fund of $2,500,000. The court approved settlement and preliminarily awarded a total sum of $1,335,750 to 685 class members with the attorney fee application and reimbursement for costs and disbursements held in abeyance. The class members were awarded $1,950 each and the named plaintiff was awarded $10,000. After filing the original motion for attorneys’ fees, the court requested additional itemization of the services rendered. Class counsel subsequently filed supplemental affirmations in support of their application for attorneys’ fees. Attorneys’ Fee Application of Silver & Kelmatcher, LLP Attached to the affirmation of Damon J. Velardi, Esq. are time sheets which give a detailed breakdown of the 1,211.8 hours expended by the law firm Silver & Kelmatcher, LLP, cost and disbursements. Plaintiffs’ counsel seeks a one-third contingency fee but is requesting that the court also consider and find the following time and rates reasonable, including: 199.8 hours at $800 per hour by Founding Partner Leslie D. Kelmachter, Esq.; 42.6 hours at $800 per hour by Founding Partner Perry D. Silver, Esq.; 412.7 hours at $600 per hour by Partner Damon J. Velardi, Esq. 12.1 hours at $450 per hour by Associate Maria White, Esq.; 5 hours at $450 per hour by Associate Dominique Fequiere, Esq.; 26.1 hours at $450 an hour hours by Associate Michael Dolgow, Esq. 328.2 hours at $200 per hour by Law Graduate Intern Lesley Campbell; 23 hours at $125 per hour hour by Paralegal Wendy Mieses; and 10 hours at $125 per hour by Paralegal Athina Anene, and $10,204.27 in total costs and expenses. If the court calculates the fees based on the hourly rates requested, the fees amount to $524,200, as follows: Name Hourly Rate Number of Hours Total Leslie D. Kelmachter, Esq. $800 199.8 $159,840.00 Perry D. Silver, Esq. $800 42.6 $34,080.00 Damon J. Velardi, Esq. $600 412.7 $247,620.00 Maria White, Esq. $450 12.1 $5,445.00 Dominique Fequiere, Esq. $450 5 $2,250.00 Michael Dolgow, Esq. $200 26.1 $5,220.00 Lesley Campbell (law graduate) $200 328.2 $65,640.00 Wendy Mieses (paralegal) $125 23 $2,875.00 Athina Anene (paralegal) $125 10 $1,250.00 TOTAL 1,059.50 $524,220.00 As a 33.33 percent recovery, as requested, the legal fees amount to $833,333.33. Attorneys Fee Application of Miller, Leiby & Associates, P.C. Doron Leiby, Esq., a named partner at Miller, Leiby & Associates, P.C., affirmed that the law firm expended 152.3 hours and the principals have an hourly rate of $750 per hour and the law firm seeks $114,225.00 as its lodestar with a multiple of 1.5 for a total amount sought of $171,337.50. Although time records have been provided to the court (NYSCEF #75), there are only about 32 entries where the initials “JM” (presumably Jeffrey R. Miller, Esq.) or “DL” (presumably Doron Leiby, Esq.) are listed. These 32 entries amount to 23.8 hours and of these hours 7.9 appear to be duplicate services. The balance of the entries do not contain any information as to the name or title of the person who provided the services. There are multiple entries regarding non-legal work such as providing status to class members and charges for “saving files.” The Court has an inadequate basis for awarding the amount of legal fees requested by this law firm. The attorney affirmation in support of the application is too vague when it asserts that services were provided by “Miller, Leiby & Associates, P.C.” without specifying exactly who provided these services. See Klein v. Robert’s Am. Gourmet Food, Inc., 28 A.D.3d 63, 75, 808 N.Y.S.2d 766, 776, 2006 N.Y. Slip Op. 00633, 2006 WL 240592 (AD 2nd Dept 2006), ” ‘[t]he valuation process requires definite information, not only as to the way in which the time was spent (discovery, oral argument, negotiation, etc.), but also as to the experience and standing of the various lawyers performing each task (senior partner, junior partner, associate, etc.)’ (Washington Fed. Sav. & Loan Assoc. v. Village Mall Townhouses, Inc., 90 Misc.2d 227, 230-231, 394 N.Y.S.2d 772 [Sup.Ct., Queens Co., Kassoff, J.]; see also Sheridan v. Police Pension Fund, Art. 2 of City of N.Y., 76 A.D.2d 800, 429 N.Y.S.2d 204).” The court is constrained to awarding only nominal legal fees to Miller, Leiby & Associates, P.C. Under a lodestar analysis, the court will award 16 hours at $450 an hour, for a total of $7,200.00. Applicable Law The methodology for determining legal fees is detailed in RMP Cap. Corp. v. Victory Jet, LLC, 139 A.D.3d 836 (AD 2nd Dep’t 2016), 839-40, 32 N.Y.S.3d 231, 235-36, 2016 N.Y. Slip Op. 03729, 2016 WL 2724849 (2016): In general, factors to be considered include “(1) the time and labor required, the difficulty of the questions involved, and the skill required to handle the problems presented; (2) the lawyer’s experience, ability, and reputation; (3) the amount involved and benefit resulting to the client from the services; (4) the customary fee charged for similar services; (5) the contingency or certainty of compensation; (6) the results obtained; and (7) the responsibility involved” (Diaz v. Audi of Am., Inc., 57 A.D.3d 828, 830, 873 N.Y.S.2d 308; see Matter of Freeman, 34 N.Y.2d 1, 9, 355 N.Y.S.2d 336, 311 N.E.2d 480; Matter of Gaffney v. Village of Mamaroneck, 21 A.D.3d 1032, 801 N.Y.S.2d 400; Steiger v. Dweck, 305 A.D.2d 475, 762 N.Y.S.2d 84). Moreover, the determination must be based upon a demonstration of the hours reasonably expended on the litigation and what is reasonable compensation for the attorney based upon the prevailing rate for similar work in the community (see Matter of Gamache v. Steinhaus, 7 A.D.3d 525, 527, 776 N.Y.S.2d 310; Gutierrez v. Direct Mktg. Credit Servs., 267 A.D.2d 427, 428, 701 N.Y.S.2d 116). The determination of a reasonable attorney’s fee is left to the sound discretion of the trial court (see Miller Realty Assoc. v. Amendola, 51 A.D.3d at 990, 859 N.Y.S.2d 258). See also Friar v. Vanguard Holding Corp., 125 A.D.2d 444, 447, 509 N.Y.S.2d 374, 377 (1986): The determination of what constitutes a reasonable fee involves extensive consideration of the nature and value of the services rendered by the plaintiffs’ attorneys. In Matter of Rahmey v. Blum, 95 A.D.2d 294, 466 N.Y.S.2d 350, we adopted an approach to awarding attorneys’ fees in which a “lodestar fee” is calculated, based upon the determination of the reasonable number of hours expended and a reasonable hourly rate, and then adjusted based upon a number of subjective considerations (Matter of Rahmey v. Blum, supra, at pp. 303-304, 466 N.Y.S.2d 350). Although Rahmey was a civil rights action on behalf of an individual, not a class, this method of awarding attorneys’ fees originated in class action litigation (see, Lindy Bros. Builders Inc. of Philadelphia v. American Radiator & Standard Sanitary Corp., 540 F.2d 102; City of Detroit v. Grinnell Corp., 495 F.2d 448) and it is suitable to this case as well. CPLR 909, reflects the following: Attorneys’ fees If a judgment in an action maintained as a class action is rendered in favor of the class, the court in its discretion may award attorneys’ fees to the representatives of the class and/or to any other person that the court finds has acted to benefit the class based on the reasonable value of legal services rendered and if justice requires, allow recovery of the amount awarded from the opponent of the class. Legal Analysis There is a paucity of cases from the Appellate Division, Second Department or Kings County Supreme Court that details the reasonable hourly rates awarded to class action counsel. However, there is an adequate number of federal cases in the Eastern District which sufficiently informs this court of the reasonable hourly rates awarded to class counsel in cases involving securities, civil rights and under the Fair Labor Standards Act, which the court will use, together with its general knowledge, regarding the appropriate rates to be applied here and what constitutes fair and reasonable. The “determination as to the proper amount of an award of attorney’s fees lies largely within the discretion of the court.” Rahmey v. Blum, 95 A.D.2d 294, 299-300 (2d Dep’t 1983). In state and federal courts, there are two acceptable options to determine counsel fees for a class action case, the percentage approach, and the lodestar method. See Nager v. Teachers’ Ret. Sys. of City of New York, 57 A.D.3d 389, 390, 869 N.Y.S.2d 492, 493, 239 Ed. Law Rep. 670, 2008 N.Y. Slip Op. 10047, 2008 WL 5334322 (2008), “Supreme Court properly used the lodestar method in determining the reasonable value of plaintiffs’ attorneys’ services in instituting and settling this class action, rather than applying a percentage of the value of the settlement, in view of the enormous disparity in result between the two methods (see Goldberger v. Integrated Resources, Inc., 209 F.3d 43, 50 [2d Cir.2000]; In re Washington Public Power Supply Sys. Sec. Litig., 19 F.3d 1291, 1297-1298 [9th Cir.1994]), and also correctly found that a multiplier was not warranted to enhance the lodestar amount (see Goldberger, id.; Sheridan v. Police Pension Fund, Art. 2 of City of N.Y., 76 A.D.2d 800, 429 N.Y.S.2d 204 [1980] ).” See also Flemming v. Barnwell Nursing Home and Health Facilities, Inc., 55 A.D.3d 162, 165 (3d Dep’t 2008) aff’d, 15 N.Y.3d 375 (2010). “[W]hether calculated pursuant to the lodestar or the percentage method, the fees awarded in common fund cases may not exceed what is ‘reasonable’ under the circumstances.” Goldberger v. Integrated Resources, Inc., 209 F.3d 43, 47 (2d Cir. 2000). Any recovery for attorney’s fees ordinarily should come from the common fund that was awarded in favor of the class. Louisiana Mun. Employees’ Retirement Fund v. Cablevision Systems Corp., 74 A.D.3d 1291, 1293 (2d Dep’t 2010). Courts have used the lodestar method and the percentage approach as a way of cross-checking the appropriateness of the legal fees in common fund cases, but very often the percentage approach is unavailable as a cross check or used only to ensure that the fee is within the “realm of reasonableness,” with lodestar methodology being presumptively reasonable in setting the legal fee.1 The court takes judicial notice that one-third fee constitutes a proportion routinely approved as reasonable with funds less than $10 million in federal courts (See In re PPDAI Grp. Inc. Sec. Litig., No. 18-CV-6716 (TAM), 2022 WL 198491, at 16 [E.D.N.Y. Jan. 21, 2022], “(See, e.g., In re Payment Card Interchange Fee & Merch. Disc. Antitrust Litig., 991 F. Supp. 2d at 445 (“[I]t is very common to see 33 percent contingency fees in cases with funds of less than $10 million….”); see also Burns, 2014 WL 12917621, at *10.)” However, there appears to be no Appellate Division cases that provide that a one-third fee is presumed reasonable up to 10 million dollars. There are some state trial courts that have awarded a class action contingency fee which range from “15 percent to 50 percent.” (Lasker v. Kanas, 2007 N.Y. Misc. LEXIS 9269 [Sup Ct, NY County Sep. 26, 2007, No. 0103557/2006]). The advantage of utilizing a contingency fee is to discourage law firms from running up their time and to encourage firms from settling earlier in litigation. Regarding hourly rates, courts have awarded average rates of up to $450 for partners, $300-350 per hour for associates, $100-150 per hour for paralegals. (See Chaparro v. John Varvatos Enterprises, Inc., No. 21-446- CV, 2021 WL 5121140 [2d Cir. Nov. 4, 2021]; In re PPDAI Grp. Inc. Sec. Litig., No. 18-CV-6716 (TAM), 2022 WL 198491, at *16 [E.D.N.Y. Jan. 21, 2022]; Tepale v. 245 Gourmet Food Inc., No. 21 CIV. 5950 (ER), 2022 WL 1186574 (S.D.N.Y. Apr. 21, 2022). See also, Zaslavskiy v. Weltman, Weinberg & Reis Co., LPA, No. 18CV4747DLIRER, 2022 WL 1003589, at *12 (E.D.N.Y. Jan. 5, 2022): As previously noted, this district rarely awards rates greater than $350 per hour in FDCPA cases, even for the most experienced attorneys. Burkett, 2020 U.S. Dist. LEXIS 131512, at __; see e.g., Razilova v. Halstead Find. Serv. LLC, No 18-CV-1668 (RRM) (PK), 2019 U.S. Dist. LEXIS 34176, at (E.D.N.Y. Mar. 1, 2019) (reducing fees of a partner with over 20 years of experience in an FDCPA case from $500 to $350 per hour and noting that “in recent years, decisions in this District have determined reasonable hourly rates in FDCPA cases at approximately $300-$350 for partners.”), adopted by 2019 U.S. Dist. LEXIS 50505; Gonzalez v. Healthcare Recovery Mgmt. Inc., No. 13-CV-1002 (JG), 2013 U.S. Dist. LEXIS 129115, at *4 (E.D.N.Y. Sept. 10, 2013) (“in FDCPA cases, courts in the Eastern District of New York regularly award experienced attorneys hourly rates ranging from $250 to $350.”) (collecting cases). The court will use rates that have been deemed reasonable by other courts, and deemed reasonable based on this court’s own assessment, and then multiply the number of hours claimed by the plaintiffs’ counsel. From this total, the court must deduct any excessive time2 as well as time spent researching, preparing, and arguing the application for attorneys’ fees which are also known as “fees on fees” as such fees are not allowable. See IG Second Generation Partners, L.P. v. Kaygreen Realty Co., 114 A.D.3d 641, 643, 980 N.Y.S.2d 479, 481, 2014 N.Y. Slip Op. 00633, 2014 WL 444009 (AD 2nd Dept 2014), “(a)n award of fees on fees also must be based upon a specific contractual provision or statute (see 546-552 W. 146th St. LLC v. Arfa, 99 A.D.3d 117, 120, 950 N.Y.S.2d 24; Sage Realty Corp. v. Proskauer Rose, 288 A.D.2d 14, 15, 732 N.Y.S.2d 162).” Cf. Mulholland v. Moret, 161 A.D.3d 883, 78 N.Y.S.3d 134, 2018 N.Y. Slip Op. 03375, 2018 WL 2123809 (AD 2nd Dept 2018). The court makes the following calculations using what it considers reasonable rates: Name Hourly Rate Number of Hours Hourly rate x hours Total Leslie D. Kelmachter, Esq. $450 199.8 $89,910.00 $89,910.00 Perry D. Silver, Esq. $450 42.6 $19,170.00 $109,080.00 Damon J. Velardi, Esq. $300 412.7 $123,810.00 $232,890.00 Maria White, Esq. $300 12.1 $3,630.00 $236,520.00 Dominique Fequiere, Esq. $300 5 $1,500.00 $238,020.00 Michael Dolgow, Esq. $250 26.1 $6,525.00 $244,545.00 Lesley Campbell (law graduate) $150 328.2 $49,230.00 $293,775.00 Wendy Mieses (paralegal) $100 23 $2,300.00 $296,075.00 Athina Anene (paralegal) $100 10 $1,000.00 $297,075.00 ADJUSTMENT ($7,065.00)3 TOTAL $290,010.00 In the instant case, the court takes notice that the attorneys’ fees under the percentage approach would be significantly higher (almost three times) than under the loadstar method. If the court calculates the fees based on the hourly rates requested, the fee will amount to $524,200, and if based on the reasonable hourly rate set by this court based on cases in the United States District Court, Eastern District, awarded in class action suits, albeit unrelated to violations of HIPPA, and based upon this court’s own knowledge and experience, with a negative adjustment for certain time entries, it would amount to $290,010.00 (with an adjustment) or a lodestar multiplier of approximately 2.873 to reach the requested 33.33 percent contingency fee of $833,333.33. Based on the foregoing, the court utilizes a lodestar amount of $290,010.00 for the law firm Silver & Kelmatcher, LLP and utilizes a lodestar amount of $7,200.00 for the law firm Miller, Leiby & Associates, P.C., and finds, in light of the exceptional services rendered by class counsel, the relatively early settlement of the matter, the risk involved, the nature of the action, the requirements to follow-up with class members, the settlement results, and the hours actually expended, applies a multiplier of 2 ( the requested multiplier was 1.5) for a total fee awarded of $594,150.00 ($290,010+$7,200.00=$297,210 x 2=$594,420.00), together with costs in the amount of $10,204.27, for a total payable to plaintiffs of $604,624.27. (The legal fee is the equivalent of 23.76 percent of the settlement amount). The court further directs that $50,000 be held in escrow for any future application for attorneys’ fees and costs in administering the settlement to its conclusion. The court finds the requests of defendant’s law firm for reimbursement of its costs and expenses for printing, compiling, and mailing the Notice Packets to Class Members is reasonable and awards $23,834.85. The court further directs that except for the attorneys’ fees, costs and the amount to be held in escrow for any future application for attorneys’ fees and costs, and reimbursement amounts, the balance to be paid proportionally to the class members. Accordingly, it is hereby ORDERED that plaintiffs’ attorneys’ fees are awarded to class counsel in the amount of $594,420.00, together with costs and disbursements, in the amount of $10,204.27, for a total of $604,624.27, to be paid from the Qualified Settlement Fund bank account; and it is further ORDERED that $50,000 is to be held in escrow in the Qualified Settlement Fund bank account for any future application for attorneys’ fees, costs and disbursements in administering and finalizing the settlement; and it is further ORDERED that the balance of the funds remaining in the qualified Settlement Fund bank account is to be proportionally distributed to the class members from the Qualified Settlement Fund bank account. This constitutes the decision and order of the court. Dated:
