Sign up
Log in
US Supreme Court urged to strike lawyers' $667 mln fee in Blue Cross case
Share
Listen to the news
US Supreme Court urged to strike lawyers' $667 mln fee in Blue Cross case

By Mike Scarcella

- The U.S. Supreme Court was asked on Thursday to strike down $667 million in legal fees and costs won by the plaintiffs’ lawyers in a $2.7 billion class-action settlement with Blue Cross Blue Shield accusing it of insurance overcharges.

The petition at the Supreme Court was filed by a member of the class who had argued in the lower court that the fee amount was too high.

A U.S. appeals court last year upheld the settlement, rejecting challenges over legal fees and other provisions that were part of the insurer's landmark 2020 accord.

Health subscribers in the long-running litigation in Alabama federal court accused Blue Cross Blue Shield Association and related entities of unlawfully agreeing with each other to compete, in violation of U.S. antitrust law.

Millions of class members allegedly paid higher insurance costs as part of the alleged conspiracy.

Attorneys for the subscriber plaintiffs did immediately respond to a request for comment. Blue Cross denied the claims in agreeing to settle.

Blue Cross Blue Shield Association and a lawyer for objector David Behenna, who filed the Supreme Court challenge, declined to comment.

Behenna’s petition argued that the fee should be more than $194 million, which was the “lodestar” amount, or the of hours the lawyers said they worked multiplied by a prevailing hourly rate.

The award instead was based on a “percentage of the fund” calculation. The fee was 23.47% of the settlement fund, and it fell within a “range of reasonableness” of 20% to 25%, the 11th U.S. Circuit Court of Appeals found.

The petition said U.S. appeals courts are divided over whether trial judges are allowed to use the lodestar approach to determine fees in cases where lawyer or litigant secures a "common fund" to be shared.

“Federal courts are entirely failing to seriously scrutinize fee applications in common-fund cases,” Behenna’s petition said.

Behenna’s challenge to the fee award is related to another pending case at the Supreme Court over the terms of the Blue Cross settlement.

In March, Home Depot filed a challenge to the deal, telling the justices that the terms are too sweeping and will harm the ability of future private parties to sue Blue Cross Blue Shield over alleged violations of competition law.

The plaintiffs’ lawyers and Blue Cross have yet responded to Home Depot’s petition.


The case is David G. Behenna v. Blue Cross Blue Shield Association et al, U.S. Supreme Court, unassigned.

For petitioner: Daniel Woofter of Goldstein, Russell & Woofter

For respondents: No appearance yet


Read more:

Lawyers in Google browsing data case ask for $218 million fee award

Blue Cross Blue Shield must face Ford Motor antitrust claims, US judge rules

$2.7 bln Blue Cross antitrust settlement upheld by US appeals court

Class lawyers defend $667 mln fee award in insurance antitrust case


(Reporting by Mike Scarcella)

((Mike.Scarcella@thomsonreuters.com;))

Disclaimer:This article represents the opinion of the author only. It does not represent the opinion of Webull, nor should it be viewed as an indication that Webull either agrees with or confirms the truthfulness or accuracy of the information. It should not be considered as investment advice from Webull or anyone else, nor should it be used as the basis of any investment decision.
What's Trending
No content on the Webull website shall be considered a recommendation or solicitation for the purchase or sale of securities, options or other investment products. All information and data on the website is for reference only and no historical data shall be considered as the basis for judging future trends.