Blue Cross and Blue Shield, N.J. v. Philip Morris
| Decision Date | 28 February 2002 |
| Docket Number | No. 98 CV 3287(JBW).,98 CV 3287(JBW). |
| Parties | BLUE CROSS AND BLUE SHIELD OF NEW JERSEY, INC., et al., Plaintiffs, v. PHILIP MORRIS, INCORPORATED, R.J. Reynolds Tobacco Company, Brown & Williamson Tobacco Corporation, Liggett Group, Inc., Lorillard Tobacco Company, British American Tobacco, Ltd. Defendants. |
| Court | U.S. District Court — Eastern District of New York |
Dewey Ballantine LLP, New York, By Paul J. Bschorr, Esq., Vincent R. Fitz-Patrick, Jr., Esq., Michael Hefter, Esq., Heather K. McDevitt, Esq., Dewey Ballantine LLP, Washington, DC, By Martha J. Talley, Esq., for Plaintiffs Blue Cross, et al.
Arnold & Porter, Washington, DC, By Murray R. Garnick, Esq., Sedgwick, Detert, Moran & Arnold, San Francisco, CA, By Kevin J. Dunne, Esq., Sedgwick, Detert, Moran & Arnold, New York, By James T. Conlon, Esq., for Defendant Philip Morris, Incorporated.
Sedgwick, Detert, Moran & Arnold, New York, By David M. Covey, Esq., Kirkland & Ellis, Washington, DC, By Kenneth N. Bass, Esq., for Defendant Brown & Williamson Tobacco Corporation.
Greenberg Traurig, LLP, New York, By Alan Mansfield, Esq., Shook, Hardy & Bacon, LLP, Kansas City, MO, By Gary R. Long, Esq., for Defendants Lorillard Tobacco Company, Lorillard, Inc.
Debevoise & Plimpton, New York, By Steven Klugman, Esq., for Defendant Council for Tobacco Research, U.S.A., Inc.
Jacob, Medinger & Finnegan, LLP, New York, By Barry S. Schaevitz, Esq., for Defendant Smokeless Tobacco Council, Inc.
Womble, Carlyle, Sandridge, & Rice, PLLC, Atlanta, GA, By R. Dal Burton, Esq., Womble, Carlyle, Sandridge, & Rice, PLLC, Winston-Salem, North Carolina 27102, By Thomas D. Schroeder, Esq., Ursula M. Henninger, Esq., Collier, Shannon, Rill, & Scott, PLLC., Washington D.C., By John B. Williams, Esq., for Defendants R.J. Reynolds Tobacco Co., and RJR Nabisco, Inc.
Chadbourne & Parke LLP, New York, By Thomas J. McCormack, Esq., for Defendant British American Tobacco (Investments) Limited (formerly known as British-American Tobacco Company Limited).
Simpson Thacher & Bartlett, New York, By Joseph McLaughlin, Esq., for Defendant BAT Industries P.L.C.
Davis & Gilbert, LLP, New York, By Bruce M. Ginsberg, Esq., for Defendant Hill & Knowlton, Inc.
Kasowitz, Benson, Torres & Friedman LLP, New York, By Leonard Feiwus, Esq., for Defendants Ligget Group Inc., Ligget & Myers, Inc., and Brooke Group Ltd.
Seward & Kissel, New York, By Anthony R. Mansfield, Esq., for Defendant The Tobacco Institute, Inc.
Table of Contents
I. Introduction ........................................................... 5
II. Factual and Procedural Background ...................................... 5
III. Law ................................................................... 11
1. Policy supporting allowing fees .................................... 12
2. Statutory authorization of attorney's fee awards ................... 17
3. Procedural considerations in awarding attorney's fees .............. 17
4. Federal Law on attorney's fees ..................................... 18
5. New York State Law on Attorney's Fees .............................. 23
IV. Findings of Fact and Law .............................................. 31
V. Conclusion ............................................................ 39
Plaintiff applies for attorneys' fees based on the recovery from defendants of a judgment in the sum of $18,436,034 including prejudgment interest, from a jury verdict pursuant to section 349 of the New York Business Law. Motions to set aside the verdict were denied. See Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris, Inc., 178 F.Supp.2d 198 (E.D.N.Y.2001). For the reasons indicated below fees are awarded in the amount of $37,841,054.22.
This and related litigation have been extensively described. See Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris, Inc., 178 F.Supp.2d 198 (E.D.N.Y.2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris, Inc., No. 98-CV-3287, 2001 WL 1328414 (E.D.N.Y. Sept. 27, 2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris, Inc., No. 98-CV-3287, 2001 WL 1328458 (E.D.N.Y. Sept. 17, 2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris, Inc., No. 98-CV-3287, 2001 WL 811930 ; Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 141 F.Supp.2d 320 (E.D.N.Y. 2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 138 F.Supp.2d 357 (E.D.N.Y.2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 133 F.Supp.2d 162; Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 199 F.R.D. 487 (E.D.N.Y.2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 199 F.R.D. 484 (E.D.N.Y. 2001); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 113 F.Supp.2d 345 (E.D.N.Y.2000); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 53 F.Supp.2d 338 (E.D.N.Y.1999); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., 36 F.Supp.2d 560 (E.D.N.Y. 1999); Blue Cross & Blue Shield of N.J., Inc. v. Philip Morris Inc., No. 98-CV-3287, 1999 WL 104815 (E.D.N.Y. Feb. 25, 1999). For related tobacco litigation in this court, see Simon v. Philip Morris Inc., 200 F.R.D. 21 (E.D.N.Y.2001); Simon v. Philip Morris Inc., 124 F.Supp.2d 46 (E.D.N.Y.2000); Simon v. Philip Morris Inc., No. 99-CV-1988, 2000 WL 1658337 (E.D.N.Y. Nov.6, 2000); Simon v. Philip Morris Inc., 194 F.R.D. 73 (E.D.N.Y.2000); Simon v. Philip Morris, Inc., 86 F.Supp.2d 95 (E.D.N.Y.2000); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., No. 98-CV-1492, 2001 WL 477256 (E.D.N.Y. Feb.27, 2001); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., No. 98-CV-1492, 2000 WL 1424931 (E.D.N.Y. Sept.26, 2000); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., No. 98-CV-1492, 2000 WL 1364358 (E.D.N.Y. Sept.20, 2000); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., No. 98-CV-1492, 2000 WL 777834 (E.D.N.Y. June 13, 2000); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., 86 F.Supp.2d 137 (E.D.N.Y. 2000); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., 71 F.Supp.2d 139 (E.D.N.Y.1999); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., 74 F.Supp.2d 221 (E.D.N.Y.1999); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., 74 F.Supp.2d 213 (E.D.N.Y.1999); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., 23 F.Supp.2d 321 (E.D.N.Y.1998); Nat'l Asbestos Workers Med. Fund v. Philip Morris Inc., No. 98-CV-1492, 1998 WL 372410 (E.D.N.Y. July 2, 1998); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1880303 (E.D.N.Y. Dec. 27, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1880305 (E.D.N.Y. Dec. 27, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1804542 (E.D.N.Y. Dec. 4, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1804602 (E.D.N.Y. Nov. 30, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1737941 (E.D.N.Y. Nov. 21, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1370437 (E.D.N.Y. Sept. 21, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1336697 (E.D.N.Y. Sept. 15, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1292671 (E.D.N.Y. Sept. 8, 2000); Falise v. Am. Tobacco Co., 107 F.Supp.2d 200 (E.D.N.Y.2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1144697 (E.D.N.Y. July 25, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1010982 (E.D.N.Y. July 19, 2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 1010978 (E.D.N.Y. July 18, 2000); Falise v. Am. Tobacco Co., 94 F.Supp.2d 316 (E.D.N.Y.2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 433097 (E.D.N.Y. Apr.18, 2000); Falise v. Am. Tobacco Co., 91 F.Supp.2d 525 (E.D.N.Y.2000); Falise v. Am. Tobacco Co., No. 99-CV-7392, 2000 WL 264332 (E.D.N.Y. Jan. 24, 2000) (Nos.CV-98-1492, CV-97-7658, CV-98-3287, CV-98-675); Falise v. Am. Tobacco Co., 193 F.R.D. 73 (E.D.N.Y.2000); Falise v. Am. Tobacco Co., 241 B.R. 63 (E.D.N.Y.1999); Falise v. Am. Tobacco Co., 241 B.R. 48 (E.D.N.Y.1999); Falise v. Am. Tobacco Co., No. 99-CV-7392, 1999 WL 98626 (E.D.N.Y. Feb. 18, 1999) (Nos.97-CV-7640, 97-CV-7658, 98-CV-675); Falise v. Am. Tobacco Co., No. 97-CV-7640, 1998 WL 372401 (E.D.N.Y. July 2, 1998); Bergeron v. Philip Morris Inc., 100 F.Supp.2d 164 (E.D.N.Y.2000); Bergeron v. Philip Morris Inc., No. 99-CV-6142, 2000 WL 748144 (E.D.N.Y. June 8, 2000); H.K. Porter Co., Inc. v. Am. Tobacco Co., 71 F.Supp.2d 73 (E.D.N.Y. 1999); In re Tobacco Litig., 193 F.R.D. 92 (E.D.N.Y.2000); In re Tobacco Litig., 192 F.R.D. 90 (E.D.N.Y.2000); In re Simon II Litigation, 172 F.Supp.2d 375 (E.D.N.Y.2001); In re Simon (II) Litig., Nos. 00-CV-5332, 98-CV-0675, 99-CV-6142, 98-CV-1492, 97-CV-7658, 99-CV-1988, 98-CV-3287, 99-CV-7392, 2000 WL 1252182 (E.D.N.Y. Sept.6, 2000).
In April 1998, numerous Blue Cross health plans from across the nation, including New York's Empire Blue Cross and Blue Shield ("Empire") filed suit against the major tobacco companies to recover the extra money they were forced to spend on patients harmed by tobacco as a result of alleged fraud by defendants. The legal and factual issues were significant to the parties and to society. The stakes were such as to warrant comprehensive presentation by the best attorneys available to plaintiff and to defendants. Plaintiffs sought some $10 billion in damages, subject to trebling. The case also was potentially important as a precedent.
This litigation was labor-intensive, time-consuming, and involved daunting legal and factual issues. Defense counsel were highly experienced in tobacco litigation. Their skills and grasp of the facts and theory had been honed in related complex litigation successfully defended in many suits across the country.
After a national search for qualified counsel, the group of Blue...
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