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Ford sues three California law firms

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FTC lawsuit wasn't justified, judge says

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Mea culpa from a plaintiffs firm

By Mike Scarcella and David Thomas

May 22 (Reuters) - (Billable Hours is Reuters' weekly

report on lawyers and money. Please send tips or suggestions to

[email protected])

Two U.S. agencies are on the hook to pay millions of dollars

in legal fees after federal judges criticized their conduct in

separate cases.

A judge in Pennsylvania ruled this week that the Federal

Trade Commission's 2020 lawsuit accusing a small company of

duping consumers into buying print subscriptions was not

"substantially justified." The ruling, which called the FTC case

"a quintessential one of overreaching," said the defendant

American Future Systems was entitled to recover its defense

fees.

U.S. District Judge Joel Slomsky said the FTC failed to back

up its claims that American Future Systems had misled customers.

The company had prevailed against the FTC in 2023 following a

15-day, non-jury trial in Philadelphia.

Lawyers from DLA Piper, White and Williams and Faegre

Drinker who represented defendants in the lawsuit will now

submit a request for compensation.

DLA's Ilana Eisenstein, who leads the firm's litigation

team, told Reuters that it was rare for a judge to find an

agency case unjustified, and that her client welcomed the

decision after years of litigation.

The FTC did not respond to a request for comment.

In the other agency case, three law firms have asked a U.S.

judge to award nearly $3 million in legal fees after they

defeated a lawsuit filed by the Commodity Futures Trading

Commission. A judge last week threw out the CFTC's case against

Traders Global Group, also known as My Forex Funds, after the

finding the agency acted in bad faith.

The defendant's lawyers at law firms Quinn Emanuel, King &

Spalding and McCarter & English in a filing said the requested

fee was "an appropriate deterrent - neither too large nor too

small - considering the egregiousness of the CFTC's misconduct."

The CFTC said on Tuesday it did not oppose the requested

amount. Acting CFTC Chairman Caroline Pham said in a prior

statement that the agency's conduct was "inexcusable."

--Law firm Kasowitz Benson Torres is representing Ford Motor ( F )

in a lawsuit in federal court in California accusing several law

firms and lawyers of fraudulently inflating their legal fees in

cases brought under the state's Lemon Law designed to protect

vehicle owners.

Ford called the alleged improper billings a "magical mystery

tour" of bogus work and time entries, claiming one of the

lawyers billed an impossible 57-1/2 hours in one day. The

attorneys that allegedly anchored the scheme regularly brought

in other law firms to overstaff cases, Ford alleged in its

complaint on Wednesday.

The automaker said it is seeking $300 million in damages

against the firms. Requests for comment on behalf of the

defendants were not immediately returned on Wednesday.

--Seattle-based Hagens Berman said it will not oppose a

request from Apple ( AAPL ) and Amazon ( AMZN ) for a combined $223,000 in

sanctions against the class action law firm, according to a new

court filing.

The tech giants accused the firm of unnecessarily dragging

out litigation over the price of iPhones and iPads after the

initial plaintiff in the case sought to drop out.

In its filing, Hagens Berman said "we respect the Court's

judgment and concerns and, with hindsight, recognize the

situation could have been handled better." The firm said it

would "redouble their efforts to ensure that this case is

conducted with the highest degree of professionalism by all

involved."

A spokesperson for the firm had no immediate comment. Apple ( AAPL )

and Amazon ( AMZN ) have denied the consumer claims in the litigation.

Neither company immediately responded to a request for comment

on the fee order.

--A jury in Fulton County, Georgia, has awarded more than

$11.4 million to former law partners of attorney L. Lin Wood, a

retired Georgia lawyer who prominently challenged Democrat Joe

Biden's victory over Donald Trump in the 2020 presidential

election.

The plaintiffs in 2020 sued Wood's firm, claiming it

breached a settlement agreement that involved payments to them

from several prior cases.

Drew Beal and Milinda Brown, the attorneys for the

plaintiffs, said the jury awarded their clients everything they

sought. "After five years of litigation, multiple appeals and

even an attempt to involve the U.S. Supreme Court, the jury

clearly understood what our clients had endured," the

plaintiffs' lawyers said.

Wood in a statement said he was disappointed by the verdict

and said he will appeal. "The verdict was not supported by the

facts or the law," Wood said. "The trial was permeated with

reversible errors."

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