Berger v. Pubco Corp., et al., C. A. No. 3414-CC (June 23, 2010), read letter decision here.  Read five prior Delaware decisions in this case highlighted here.

In this case, the Court addressed plaintiffs’ petition for attorneys’ fees and expenses in a class action settlement and awarded plaintiffs’ counsel $1.2 million (or approximately 26% of the value of the cash recovered for Pubco’s former minority shareholders). The Court noted that this was not a case involving the filing a complaint with a quick settlement. Rather, this was a complex case which involved “lengthy and thorough” litigation with a final recovery to the class “that is more than double the merger consideration.” The Court also noted that this recovery of a 26% fee is at the bottom of the 25-33% range that is found in many Court of Chancery cases and “the hourly rate to which the fee translates (approximately $3,450 per hour, as I calculate based on the information in plaintiff’s petition) is nestled within the range of hourly rates found among Court of Chancery monetary-benefit cases.”

This case also presented a unique issue that dealt with an initial award to plaintiffs’ counsel of $250,000 in attorneys’ fees and expenses which had already been paid. The defendants wanted the $250,000 considered as an advance on the $1.2 million fees ultimately awarded to plaintiff’s counsel. The Court disagreed noting that “[t]he initial award related to the breach of fiduciary duty by Pubco’s controlling shareholder, as well as to the relief resulting in heightened disclosure…. [and] a fiduciary in breach of its duties should bear the cost of litigation.”

Kevin F. Brady of Connolly Bove Lodge & Hutz LLP provided this summary.