On Sunday, dozens of attorneys representing the 98 people killed and others injured in the Champlain Towers South collapse submitted their total legal fees bill. Their bill, which must be reviewed and approved by a Miami-Dade judge, is 10% of the $1 billion settlement reached by the victims' lawyers with various defendants and other parties in the Champlain Towers South class-action case last month.
The Miami Herald first reported last week that the expected $100 million request is based on more than just total hours of legal work. More than three-quarters of the bill is derived from a "multiplier," which is sometimes used in large class actions to represent the risk factor that law firms assume in complex cases with uncertain outcomes.
Miami-Dade Circuit Judge Michael Hanzman initially demanded that the lawyers work for free, but he left the door open for the plaintiffs' lawyers to charge for their time based on the outcome. In a catastrophic case like the Champlain South class action, Hanzman explicitly ruled out the usual contingency fee of one-third of the damages.
According to a 400-page motion with attachments filed in Miami-Dade Circuit Court, 17 South Florida law firms and 132 attorneys, paralegals, and assistants submitted more than 34,200 hours of billable time.
According to his declaration, a legal expert hired by the lawyers to calculate their fees calculated a "melded" hourly rate of $715 for a total of about $24.7 million — but then reduced that amount to $22.2 million to account for excessive billable time. Because of the significant "risk factor" in collecting damages, the lawyers' expert applied a multiplier of 4.5 — the highest end of a 1 to 5 scale under Florida law. As a result, their expert recommended that they pay a total of $100,092,784 in legal fees.
"As the [judge] stated from the start of the litigation — this would most likely be a 'limited fund' case," attorney Philip Freidin, who has been practicing law in Florida for 53 years, wrote in a declaration explaining his recommendation for legal fees in the wrongful-death class action. "However, no one expected this kind of result, let alone so quickly." It is unprecedented.
"When compared to the traditional percentage-based contingency fee model," Freidin wrote, citing lawsuits involving the "lesser scale" collapses of the Florida International University bridge (six dead) and the Miami Dade College parking garage (four dead) over the last decade.
The plaintiffs' legal team's co-chairs issued a statement saying the proposed bill "represents the culmination of intense work by 17 law firms to achieve a historic recovery for the victims of the Surfside tragedy that exceeds $1 billion."
According to attorneys Rachel Furst and Harley Tropin, it "is fair in light of the risks the firms assumed, the results they achieved, and the significant savings on fees realized by the victims as a result of the unique procedures Judge Hanzman used in this case."
Because the various attorneys are still assisting the family members of the Surfside condo victims in filing individual wrongful-death claims and guiding them through their "mini-trials" before Hanzman, who has scheduled them for August, the attorneys' fees could rise over the summer.
Before the plaintiffs' lawyers filed their bill, a Vanderbilt University law professor who specializes in class-action cases and legal fees told the Miami Herald that a recovery of about 10% is "ordinary" in a case of Champlain South's magnitude.
According to Professor Brian T. Fitzpatrick's research on class actions, the average attorneys' fee in a settlement exceeding $1 billion is 13.7 percent. The median fee is 9.5% of the total.
Whatever Hanzman ultimately approves in legal fees, which is expected after the summer, will have a direct impact on the victims' compensation. In other words, the attorneys' fees will be deducted from the total settlement with over 25 defendants and other parties, including Champlain South's security firm, developers, engineers, and other contractors. Their insurance companies will cover almost all of the costs.
Several of the 136 Champlain South condo owners who reached a $96 million settlement for their unit losses expressed dissatisfaction with the idea that the lawyers could collect more compensation than they did. Separate from the wrongful-death settlement, their property-loss agreement includes $750,000 in attorneys' fees.
At a recent court hearing, one owner, Alberto Manrara, who was not at home when the 12-story oceanfront tower collapsed on June 24, 2021, told the judge that "the word on the street is that the award is probably going to be $100 million — $100 million to the attorneys and $96 million to the property owners."
"It just doesn't seem right, and it certainly doesn't seem fair," Manrara said.
"All the victims will have a right to be heard, and I will make a decision based on that, not on word on the street, not on my perception of my legacy, not on anything except what they did in this one case," Hanzman retorted. OK?”