Authorizes attorneys' fees to be awarded to any person that the court finds has acted to benefit the class.
Ayes (58): Addabbo, Alesi, Avella, Ball, Bonacic, Breslin, Carlucci, DeFrancisco, Diaz, Dilan, Espaillat, Farley, Flanagan, Fuschillo, Gallivan, Gianaris, Golden, Griffo, Grisanti, Hannon, Hassell-Thomps, Huntley, Johnson, Kennedy, Klein, Krueger, Lanza, Larkin, LaValle, Libous, Little, Marcellino, Martins, Maziarz, McDonald, Montgomery, Nozzolio, O'Mara, Oppenheimer, Parker, Peralta, Perkins, Ranzenhofer, Ritchie, Rivera, Robach, Saland, Sampson, Savino, Serrano, Seward, Skelos, Squadron, Stavisky, Stewart-Cousin, Valesky, Young, Zeldin
Excused (4): Adams, Duane, Kruger, Smith
TITLE OF BILL: An act to amend the civil practice law and rules, in relation to the award of attorneys' fees in class actions
This is one in a series of measures being introduced at the request of the Chief Administrative Judge upon the recommendation of her Advisory Committee on Civil Practice.
A recent decision of the New York Court of Appeals, Flemming v Barnwell Nursing Home and Health Facilities, Inc., _ N.Y.3d _,2010 WL 4116615 (Oct. 21, 2010) highlights what our Advisory Committee believes to be a deficiency in the scope of CPLR Rule 909, which relates to the award of attorneys' fees in class actions. That rule gives a court discretion to award attorneys' fees to representatives of the class based upon the reasonable value of the services rendered. In Flemming, the issue was whether an attorney for an objecting member of the class, whose actions actually benefitted the class, could also receive an award of attorneys' fees. The majority held that the attorney could not receive fees because of the strict wording of rule 909 which limits an award of fees to "representatives of the class." Two judges dissented, arguing that rule 909 was not intended to restrict the well-established common fund doctrine, which, under the common law, allowed those whose actions benefitted a common fund to receive reimbursement for their efforts.
We believe that it is appropriate for a court to award fees, in appropriate actions, to a party whose attorney benefits the class in some tangible way, other than as counsel to the named class members. In many class action cases, objecting parties successfully argue that the proposed settlement is inadequate, that the class should be expanded or, as in Flemming, that the fees proposed for the class representatives are too high. The court should also have the discretion to compensate counsel for those efforts.
We therefore propose an amendment to CPLR rule 909 to specifically provide that the court may award attorneys' fees to not only representatives of the class, but also to any person that the court finds has acted to benefit the class.
This measure would have no fiscal impact on the State. It would take effect immediately and apply to all actions commenced on or after the date on which it shall have become a law and all actions pending on the date on which it shall have become a law.
LEGISLATIVE HISTORY: None. New proposal.
STATE OF NEW YORK ________________________________________________________________________ 4577--A Cal. No. 441 2011-2012 Regular Sessions IN SENATE April 12, 2011 ___________Introduced by Sens. BONACIC, PARKER -- (at request of the Office of Court Administration) -- read twice and ordered printed, and when printed to be committed to the Committee on Judiciary -- reported favorably from said committee, ordered to first and second report, ordered to a third reading, amended and ordered reprinted, retaining its place in the order of third reading AN ACT to amend the civil practice law and rules, in relation to the award of attorneys' fees in class actions THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Rule 909 of the civil practice law and rules, as added by chapter 207 of the laws of 1975, is amended to read as follows: Rule 909. Attorneys' fees. If a judgment in an action maintained as a class action is rendered in favor of the class, the court in its discretion may award attorneys' fees to the representatives of the class AND/OR TO ANY OTHER PERSON THAT THE COURT FINDS HAS ACTED TO BENEFIT THE CLASS based on the reasonable value of legal services rendered and if justice requires, allow recovery of the amount awarded from the opponent of the class. S 2. This act shall take effect immediately and apply to all actions commenced on or after the date on which it shall have become a law and all actions pending on the date on which it shall have become a law.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD09315-03-1