The Common Benefit Process
Susan Barfield (00:05):
Hello everyone. Thank you for joining another CaseWorks stream. We are joined today by Amy Collins, and we’re going to talk all things common benefit. So Amy, thanks so much for taking time to connect with us and share just a lot of information, insight about even what common benefit is. But let’s start off, I’d love to understand your background. I know your firm is out of Houston, and you provide consulting as it relates to common benefit. I’d just love to understand how you even got into this, and just a little bit about your background.
Amy Collins (00:40):
Sure. So, I’ve been an attorney for 12 years now. My entire legal career I’ve been involved in mass torts or complex litigation. And a few years ago, my former law partner was appointed to the fee committee for TBM. And, that was quite a big litigation. A lot of firms were involved in that, submitting time, and applying for common benefit fees. And so, they need a little bit of help with reviewing the time submissions. And so, they brought me in, and a few other folks from some of the other firms that were also on the fee committee. And, I just found that I really enjoyed that work, it’s something that was just intuitive to me, I like the data aspect of it. And so, working with the attorneys that were on the fee committee, they went on to be appointed at leadership positions, co-leads, and other litigations. And so, based on the work that I did there, seemed like a good idea to them to bring me on early in the process. So, I could review the time and provide reporting as we went, rather than wait until the end of the litigation.
Susan Barfield (01:51):
Amy Collins (01:52):
So, what my firm does is, basically all things common benefit. At the beginning of the litigations, we’ll advise on what should be contained in the common benefit orders, including assisting drafting with the common benefit orders, establishing and managing the process for firms to submit their common benefit time and expenses. We also provide training. We review all the submitted time and expenses for compliance with the common benefit orders, provide detail reporting to co-leads courts, establish audits and deficiency processes, provide feedback, and then provide support to the fee committee or court or co-leads, whoever’s in charge of awarding common benefit attorney’s fees will provide data support throughout that process.
Susan Barfield (02:40):
Yeah. Sounds like that’s a lot of work and you’re very busy. But even taking a step back, what exactly is common benefit?
Amy Collins (02:47):
That’s a great question. So, in typical MDLs, what happens is? You’ll have lawsuits filed all over the country, and then they get transferred into the MDL, or sometimes there’s a direct filing order and the cases will get filed on the MDL. And oftentimes is the case gets filed, the firms will fill out and serve a Plaintiff’s fact sheet, and then they just kind of hang out for a while, either waiting on a inventory settlement, a global settlement, or waiting on their case to get remanded. And so, while they’re waiting on all of that, there’s another group of firms who are working up the case, working up the litigation, discovery, developing experts, things like that. And so, the idea is that the firms who are performing all of this work, should be compensated for that work, because it’s providing a benefit to all of the litigants.
Susan Barfield (03:36):
Amy Collins (03:37):
And the litigants who are receiving the benefit of that, should pay something to those firms who are providing that common benefit. So it’s basically the common benefit doctrine, which just holds that, those who reap the benefits of the lawsuit, shouldn’t be unjustly enriched without helping defray some of the costs. Because you know, that these firms that are working up this case, spending a lot of time and a lot of out of pocket expenses, to get to either a successful settlement, or at a minimum, get to where they have a complete trial package available to those firms. So, those when they get remanded, they’re ready to try their case.
Susan Barfield (04:20):
Yeah. Well, thanks for explaining that. I know I’m asked that, oftentimes attorneys will talk to me and ask me about the common benefit. And so, that’s really what, I wanted you to come on and kind of explained, because I wasn’t sure that I was explaining it correctly. But when you mentioned drafting the common benefit order for those in leadership, what are some of the important considerations when drafting the common benefit order?
Amy Collins (04:46):
Sure. So, first of all, I would recommend getting a common benefit order entered as early as possible in the litigation. Oftentimes there’ll be significant amount of work done before the case actually gets consolidated, and an MDL is formed. Even when that doesn’t happen, right after an MDL is formed, a lot of firms get busy right away on working on common benefit matters. And so, you want to make sure you have an order entered. So, it really defines what’s considered common benefit, what’s not. Reporting requirements, who can authorize common benefit work, and who’s authorized to perform common benefit work. So getting that as entered early in the litigation, is very helpful for everyone involved. The other thing would be, make sure you provide really clear rules. I mentioned, who can authorize common benefit work. I’ve seen situations where, we have firms, PEC firms, for example, who assign work to non-PEC firms, without co-lead council knowing.
Amy Collins (05:54):
So there’s got to be some kind of oversight, as to what work is being assigned out, who’s performing the work, how was it authorized. And so, that’s one of the services that we can provide as well, and one of the litigations I’m involved in. We actually provide very detailed monthly reporting to the co-leads. Each month, they get not only a list of all of the firms who’ve submitted common benefit, time and expenses, but also a detailed summary on what those firms are working on. So that really helps leadership understand who’s doing the work, verifying that this is all authorized work, and also helps them allocate resources appropriately.
Susan Barfield (06:33):
You mentioned, what can and cannot be considered common benefit. Is there work that is mistakenly tried? I mean, that you see commonly trying to be billed, that can’t be billed. And what would some of those items look like?
Amy Collins (06:50):
Sure. That actually happens quite a bit. Just for an example, generally, case-specific work is not really considered common benefit work. The exception is, if the case was designated as a bellwether, for example. And so what you want to include in your order is very clear, what case-specific work, at what point. Oftentimes there’s a robust bellwether selection process. And so, at what point in that bellwether selection process, is the work on those cases going to be considered common benefit. Another area would be parallel state court litigation. Sometimes you’ll have firms who are working up state court cases, doing what they think is common benefit work, and perhaps it is. But maybe it doesn’t get compensated, because either it wasn’t authorized, or there were no clear guidelines as to what part of that work would be considered common benefit work.
Susan Barfield (07:52):
You talked about, there are some areas of con… What are some of those areas of contention that you see during the fee award process?
Amy Collins (07:59):
Sure. And so, just like I stated, the bellwether selection process, basically any type of case-specific work. And then also sometimes firms will have unrealistic expectations. And, I don’t know if it’s just because they’re new to the mass tort world, new to performing common benefit work. But what I would say is, not all hours are created equal. I think sometimes some firms get involved in, get a little aggressive with their billing, thinking that, oh, if I have the most hours or if I have more hours, I’ll get paid more. Right? But, that’s not always the case, there’s other factors that are considered. Most courts have moved from the lodestar method, which is basically multiplying the hours times a rate, and then coming up with amount. They move from that to the percentage of the fund method, which is basically, or the blended method. Which is the percentage of the fund method, with a lodestar cross-check. So, while the hours are an important aspect of considering the amount to be paid in a common benefit attorney’s fees, it’s not the end-all be-all, and there are other factors that will be considered.
Susan Barfield (09:14):
And when we look at the billing practices, how can firms improve their billing practices to maximize the benefit award?
Amy Collins (09:21):
Sure. So, it sounds silly to state, but the most obvious is, read the common benefit orders and follow all of the instructions. A good common benefit orders will have pretty much everything you need in there to know what you need to do. One of the things that I like to provide when I’m engaged in a project, working on a particular MDL is, I’ll actually prepare a billing guide, which is kind of like a cheat sheet of the common benefit order. And that’s a document that can be distributed to everyone in a firm who’s working on common benefit work. It provides kind of the important points of the common benefit order, limitations, rules, examples of good billing and bad billing. And so I like to provide that in all the litigations that I’m involved in. And in addition to that, also provide training as well, just to walk people through the process.
Amy Collins (10:14):
We’ll get some firms who are new to this, and so we want to make sure that they understand how all of this works. And then we have firms who’ve been involved in the mass tort world for years, but maybe they’ve developed some bad habits over time. And so, we’ll provide that training. Also make sure that all the work’s been authorized, like I stated before, generally in common benefit orders, it’ll state something like, the work has to be authorized by lead counsel in writing. And so, make sure you get your authorization, if you’re unsure, that’s really going to help at the end, if there’s any dispute whatsoever, whether or not that work was authorized. And then, I’ll just mention a couple more. Keep in mind the reason that you’re billing this time and submitting this time, is that it’s going to form the basis of your attorney fee award, from the common benefit fund.
Amy Collins (11:08):
And so, just keep that in mind when you are preparing your time, making sure you’re descriptions are detailed, making sure whoever is reviewing it, understands, one, not only what you’re doing, but two, that it’s in compliance with the order and it is common benefit time. And then finally, I would say, my biggest pet peeve as a reviewer of common benefit time, is the block billing. And what I mean by that is, firms who will take every single task that they performed in one day. The firm member will, they’ll just put it all in one entry. And the problem there is, sometimes contained in that one time entry with all of those different tasks is, there’s work in there that’s not common benefit. So I’m left with two choices, either disallow the entire entry, including the time that’s common benefit, because I can’t tell how much of that eight hour block is actually common benefit or not, or I have to flag it and send it back to the firms. And, some of these MDLs last for several years.
Amy Collins (12:14):
And so, if a firm member has to go back and break out all of their time entries over several years, it’s going to be unpleasant for them. So, follow the rules at the beginning, make it easier on yourself. You don’t going to spend all your time trying to fix your time. You want to spend your time working on your cases.
Susan Barfield (12:32):
Right. Yeah, absolutely. Very helpful, great insight. What would you say to firms that reach out to you for consulting? What is the main thing that you’re working with them on?
Amy Collins (12:43):
So I generally work with the co-lead council, or fee panels, fee committees. And, I just provide, like I stated earlier, consulting just kind of, hey, here’s best practices. Every time I get involved in a new project, I learn, and I take what I’ve learned in previous projects and apply it to my new one. So, I’m constantly building on the experience that I have, trying to improve the processes, streamline it, make it easier for everyone. And so, that’s something that I would bring to anyone who reaches out to me is my knowledge and experience to advise them on, the best way to run the process.
Susan Barfield (13:29):
Yeah. Yeah, exactly. Well, good. Well, this has been so helpful. Lots of great feedback. I know, like as I mentioned, I’m asked by attorneys about common benefit and I wasn’t sure, I thought it’d be great to have someone on, that actually… Like yourself, who does consulting for firms to provide a level of insight. We’ll make sure we have all of your information. So when we send this out to our network attorneys that may need some help or need some advice, we’ll know how to get hold of you. So, thank you so much for taking time to connect and share all things, common benefit. We certainly appreciate your time, Amy.
Amy Collins (14:03):
Thank you so much for having me.