Wednesday, June 2, 2010
“It’s going to be a jungle of different kinds of legal beasts running around.”
I have four words for you, BP: punitive damages class action. See Catherine Sharkey's article The Exxon Valdez Litigation Marathon for more.
The lawyers have offered to cap their fees at 20% instead of 30%. But this does not solve all the issues identified by Judge Hellerstein, particularly the "pig in a poke" problem - claimants can't figure out what they will get before signing on.
This offer to reduce fees reminds me of the governmental attempt to reduce the bonuses AIG had contracted to give certain employees after its implosion. Not that the situation is the same, but it shares a theme. The theme: even when you have a signed contract there is the possibility to renegotiate (perhaps something more than a mere possibility in the case where a federal judge says your fees are too high) .