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Legal Fee Tracker: American Airlines presses $139 mln fee bid after $1 verdict
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Legal Fee Tracker: American Airlines presses $139 mln fee bid after $1 verdict
Oct 10, 2024 11:22 PM

Oct 10 (Reuters) - The largest U.S. airline by fleet

size is taking another stab at reaping almost $140 million in

attorney fees after winning just $1 in damages in an antitrust

lawsuit that originally sought $1 billion.

American Airlines ( AAL ) has been battling over the fees for two

years with Sabre Corp ( SABR ), the country's largest owner and operator

of an electronic network travel agents use to search and book

flights listed by the airlines. American's lawyers on Monday

asked a Manhattan federal judge to order Sabre to pay more than

$139 million in legal fees for more than a decade of work on the

case.

The legal fight began in 2011 when US Airways accused Sabre

of impeding travel agents and others from using less expense

alternatives for booking seats, and imposing an unduly

restrictive distribution agreement. American took over the case

after it merged with US Airways.

A jury agreed with American in 2022 that Sabre had monopoly

power, but determined that its contract with US Airways did not

constrain trade as American had alleged. American sought more

than $1 billion in damages in its lawsuit, but the jury only

awarded the airline $1. Sabre never appealed the verdict.

American's lawyers at O'Melveny & Myers and Yetter Coleman

said in Monday's fee petition that the verdict was a victory for

the airline and the entire industry, leading to a new contract

with Sabre that allowed for greater competition.

"We had hoped to resolve this issue amicably and without the

court's assistance, but it's clear the parties still disagree on

the importance of this litigation and US Airways and American's

statutory right to recover attorneys' fees," American said in a

statement.

A spokesperson for Sabre declined to comment.

Andre Barlow, an antitrust lawyer at Washington, D.C.-based

law firm Doyle Barlow & Mazard who is not involved in the case,

said in an email that such a high fee award in a case involving

nominal damages would be unusual.

"That said, antitrust cases are complex and I don't doubt

that the reasonable attorneys fees are significant in this case

and would far exceed the damages award," Barlow said. He noted

there's no rule requiring attorney fees to be proportionate to a

damages award.

Sabre has maintained that it prevailed in the 2022 trial,

noting the size of the award and that American did not win on

all of its claims. American and Sabre, which is now represented

by a team of lawyers from Davis, Polk & Wardwell, tried to

resolve the fee dispute via settlement talks.

U.S. District Judge Lorna Schofield denied American's first

request for more than $139 million in February as the airline

and Sabre tried to work resolve their dispute. She said American

could refile "when and if settlement negotiations break down."

In the renewed request it filed on Monday, American argued

its success should be judged by the effect the verdict had on

the broader market, not by the specific damages it was awarded.

It said it was already seeking 15% less than the $159 million it

believes it is fairly owed.

"A finding that Sabre possesses monopoly power and abused it

over the course of many years is far more significant for the

industry and market as a whole than a mere finding that the 2011

contract between US Airways and Sabre was anticompetitive,"

American said.

American's lawyers and other legal staff billed more than

185,000 hours on the case between its 2011 inception and June 1,

2023, according to court filings. The firm's $139 million

request amounts to an average of $750 an hour, and excludes work

done by the airline's former counsel at Cadwalader, Wickersham &

Taft.

Sabre has not yet submitted a formal response to American's

fee requests, but it has stated its opposition in other court

papers. In December 2022 it said a "nine-figure fee for a

so-called $1 'win' is plainly unsupportable, and any recoverable

fees should be slashed by at least 99%."

Sabre's opposition brief is due in January.

-- In other legal news, plaintiffs' lawyers who worked out a

tentative $750,000 data breach settlement with snack food giant

Mondelez and law firm Bryan Cave Leighton Paisner can receive up

to one-third -- or $250,000 -- of that amount in fees.

The settlement resolves claims by a proposed class of 51,100

current and former Mondelez employees who alleged their data was

not property protected after a 2023 data breach at the law firm

compromised their personal information. Mondelez and BCLP denied

wrongdoing and made no admission of liability in the settlement.

-- A U.S. judge on Monday gave tentative approval to the

National Collegiate Athletic Association's landmark $2.7 billion

settlement agreement to compensate student athletes for past and

future commercial use of their names, images and likenesses.

The two law firms that spearheaded the litigation, Hagens

Berman Sobol Shapiro and Winston & Strawn, are poised to earn

hundreds of millions of dollars thanks to the unusual,

multifaceted fee structure they've proposed.

(Legal Fee Tracker is a weekly feature exploring attorney

compensation awards and disputes in class actions, bankruptcies

and other matters. Please send tips or suggestions to

[email protected].)

Read More:

Legal Fee Tracker: Whistleblower lawyers could lose big in

False Claims Act fight

Legal Fee Tracker: Law firms line up in Baltimore bridge

collapse cases

Legal Fee Tracker: Google, privacy lawyers clash over $217

million fee bid

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