Case: 18-2012 Document: 003113316560 Page: 1 Date Filed: 08/09/2019 Case Nos. 18-2012, 18-2225, 18-2249, 18-2253, 18-2281, 18-2332, 18-2416, 18- 2417, 18-2418, 18-2419, 18?2422, 18-2650, 18?2651, 18-2661, and 18-2724 United States Court of Appeals for the Third Circuit In re National Football League Players? Concussion Injury Litigation Appeal from the United States District Court for the Eastern District of (Hon. Anita B. Brody, No. 2: 14-md?02323-AB and No. 2323) JOINT OPENING BRIEF OF APPELLANTS AND OPENING BRIEF OF APPELLANT LOCKS LAW FIRM ADDRESSING THE COMMON BENEFIT FEE ALLOCATION ORDER Tobias Barrington Wolff Gene Locks 3501 Sansom Street Michael Leh Philadelphia, PA 1910f:L Locks Law Firm (215) 898-7471 The Curtis Center Counsel for the Locks Law Firm 601 Walnut Street, Suite 720 East Philadelphia, PA 19106 (866) 562?5752 Case: 18-2012 Document: 003113316560 Page: 2 Date Filed: 08/09/2019 APPELLANTS WHO JOIN THE JOINT OPENING BRIEF Gaetan J. Alfano Kevin E. Raphael Alexander M. Owens PIETRAGALLO GORDON ALFANO BOSICK RASPANTI 181 8 Market Street Philadelphia, PA 19103 (215) 320?6200 Coume/?rAmpo/ Week; J. Gordon Rudd, Jr. Brian C. Gudmundson Michael J. Laird ZIMMERMAN REED LLP 1100 IDS Center, 80 Eighth Street Minneapolis, MN 55402 Comm/for Zimmerman Reed Michael L. McGlamry POPE KILPATRICK MORRISON NORWOOD 3391 Peachtree Road, N.E., Suite 300 Atlanta, GA 30326 (404) 523?7706 Coum'e/for Pope Mc?G/amg/ Anthony Tarricone KREINDLER KREINDLER LLP 855 Boylston Street Boston, MA 02116 (617) 424?9100 ozmre/ for Krez'ndler 2?7 Krez'nd/er LLP Craig R. Mitnick MITNICK LAW OFFICE 35 Kings Highway East Haddon?eld, NJ 08033 (856) 427?9000 Ceum?e/for Mimic/? Law O?z?ee Charles L. Becker KLINE SPECTER 1525 Locust Street Philadelphia, PA 19102 (215) 772?1000 came! for ?ee Aldridge Olejeez?orr Lance H. Lubel Adam Voyles LUBEL VOYLES LLP 675 Bering Drive Houston, TX 77057 (713) 284?5200 Comm/for flee Aldridge Objeez?orr Mickey L. Washington WASHINGTON ASSOCIATES, PLLC 2109 Wichita Street Houston, TX 77004 (713) 225?1838 Coum?e/for ?ee [Cl/{fridge Objeez?orr John J. Pentz 19 Widow Rites Lane Sudbury, MA 01776 (978) 261?5725 Connie/for ?ee Mil/er Oly'eetorr Edward W. Cochran COCHRAN COCHRAN 20030 Marchmont Road Shaker Heights, OH 44122 (216) 751?5546 Commie/fer flee Mil/er Objeez?orr Case: 18-2012 Document: 003113316560 Richard L. Coffman THE COFFMAN LAW FIRM 505 Orleans Street, Suite 505 Beaumont, TX 77701 (409) 833?7700 Comm/for the Amu?rong Objec?tory Mitchell A. Toups WELLER, GREEN, TOUPS TERRELL 2615 Calder Street, Suite 400 Beaumont, TX 77702 (409) 838?0101 Coum?dfor #93 Objectorx Page: 3 Date Filed: 08/09/2019 Jason C. Webster THE WEBSTER LAW FIRM 6200 Savoy, Suite 515 Houston, TX 77036 (713) 581?3900 Counsel for the Arm?trorzg Okylectorx Case: 18-2012 Document: 003113316560 Page: 4 Date Filed: 08/09/2019 TABLE OF CONTENTS TABLE OF CONTENTS i TABLE OF AUTHORITIES STATEMENT OF JURISDICTION 1 ISSUES PRESENTED 1 RELATED CASES AND PROCEEDINGS 2 STATENIENT OF THE CASE 3 The NFL Concussion Injury Litigation 3 The Early Phase of the Litigation 5 The Class Action Settlement 6 The Common-Bene?t Fee Petition 8 Mr. Seeger?s Proposed Fee Allocation 10 The Fee Allocation Hearing 11 The Fee Allocation Order 14 SUMMARY OF ARGUMENT 16 STANDARD OF REVIEW l7 ARGUIVIENT OF JOINT APPELLANTS 17 I. THE PROCEDURES THE DISTRICT COURT USED TO ALLOCATE FEES LACKED FAIRNESS, TRANSPARENCY AND ADEQUATE SUPERVISION 8 Case: 18-2012 Document: 003113316560 Page: 5 Date Filed: 08/09/2019 A. The District Court Authorized Mr. Seeger to Conduct a Unilateral, Non-Transparent Allocation Process Without Negotiation, Consensus, or an Auditor or Special Master 20 B. Mr. Seeger?s Time Records Were Not Subject to Adversarial Scrutiny, Not Disclosed to Any Other Firm, and Not Independently Reviewed 24 1. The District Court?s Failure to Make Time Records Available for Review On the Record Violates Due Process 24 2. The District Court Committed Legal Error and Made an Unreliable Allocation by Giving Mr. Seeger Unilateral Control Over Time Records 29 C. The District Court Has Already Adopted a Robust Procedure for Judicial Scrutiny of Attorney Lien 33 II. THE DISTRICT COURT DID NOT CONDUCT AN INDEPENDENT REVIEW SUFFICIENT TO CURE THE INF IRMITIES IN THE ALLOCATION PROCESS 36 ARGUMENT OF LOCKS LAW FIRM 40 I. THE COURT FAILED TO CONDUCT THE REQUIRED LODESTAR ANALYSIS AND EMPLOYED AN IMPROPER ALLOCATION STANDARD 41 II. THE FINDINGS AGAINST LLF ARE NOT SUPPORTED BY SUBSTANTIAL EVIDENCE 48 A. The Lower Multiplier Applied to LLF is Clear Error 48 B. The Court Created No Record and Issued No Speci?c Ruling on LLF ?s Objections to Exclusion of Time from its Lodestar 52 CONCLUSION 55 ii Case: 18-2012 Document: 003113316560 Page: 6 Date Filed: 08/09/2019 TABLE OF AUTHORITIES Cases Page American Bd. of Intern. Med. v. Von Muller, 540 Fed. App?x 103 (3d Cir. 2013) 27 Amchem Prods, Inc. v. Windsor, 521 U.S. 591 (1997) 47 Procaps S.A. v. Patheon Inc., No. 12-24356-CIV, 2013 WL 5928586 (SD. Fla. Nov. 1, 2013) 29 Goldberger v. Integrated Resources, Inc., 209 F.3d 43 (2d Cir. 2000) 42 Hartman v. Lyphomed, Inc., 945 F.2d 969 (7th Cir. 1991) 42, 43 In re Cendant Corp. PRIDES Litig, 243 F.3d 722 (3d Cir. 2001) 46 In re Cendant Corp. Sec. Litig., 404 F.3d 173 (3rd Cir. 2005) 42 In re Chinese-Manufactured Drywall Prods. Liab. Litig, MDL No. 09-2047, 2018 WL 2095729 (ED. La. May 7, 2018) 32, 40 In re Diet Drugs Prods. Liab. Litig. 401 F.3d 143 (3d Cir. 2005) 18, 19, 21 In re Diet Drugs Prods. Liab. Litig, 553 F. Supp. 2d 442 (ED. Pa. 2008), 582 F.3d 524 (3d Cir. 2009Diet Drugs Prods. Liab. Litig, 582 F.3d 524 (3d Cir. 2009) passim Case: 18-2012 Document: 003113316560 Page: 7 Date Filed: 08/09/2019 In re E.I. Du Pont de Nemours and Company Pers. Inj. Litig., N0. 2018 WL 4771524, adopted and ordered, 2018 WL 4810290 (S.D. Ohio Oct. 3, 2018) passim In re Fine Paper Antitrust Litig., 751 F.2d 562 (3d Cir. 1984) passim In re Gen. Motors Corp. Pick? Up Fuel Tank Prods. Liab. Litig., 55 F.3d 768 (3d Cir. 1995) 33 In re High Sulfur Content Gasoline Prods. Liab. Litig., 517 F.3d 220 (5th Cir. 2008) 28, 29 In re Imperial ?400?Nat., Inc., 432 F.2d 232 (3d Cir. 1970) 28 In re NASDAQ Market-Makers Antitrust Litig. 187 F.R.D. 465 (S.D.N.Y. 1998) 42 In re Nat 7 Football League Players Concussion Injury Litig. 307 F.R.D. 351 (ED. Pa. 2015), 821 F.3d 410 (3d Cir. 2016) 8 In re Nat 7 Football League Players Concussion Injury Litig. 821F.3d 410 (3d Cir. 2016Nineteen Appeals Arising Out of San Juan Dupont Plaza Hotel Fire Litig. 982 F.2d 603 (lst Cir. 1992) 25, 26 In re Prudential Ins. Co. Am. Sales Practice Litig. Agent Actions, 148 F.3d 283 (3d Cir. 1998) 27, 41 In re Rite-Aid Corp. Securities Litig., 396 F.3d 294 (3d Cir. 2005) 27, 43 In re Thirteen Appeals Arising Out of San Juan Dupont Hotel Fire Litig., 56 F.3d 295 (lst Cir. 1995) 26 iv Case: 18-2012 Document: 003113316560 Page: 8 Date Filed: 08/09/2019 In re Vioxx Prods. Liab. Litig, 802 F. Supp. 2d 740 (ED. La. 2011) passim In re Warfarin Sodium Antitrust Litig, 391 F.3d 516 (3d Cir. 2004) 20, 21 Interfaith Community Org. v. Honeywell Intern, Inc., 426 F.3d 694 (3d Cir. 2005) 1 Interfaith Community Org. v. Honeywell Intern, Inc., 726 F.3d 403 (3d Cir. 2013) 17, 41, 51, 54 Komoroski v. Utility Service Partners Private Label, Inc. No. 2017 WL 5195880 (W.D. M0. Nov. 9, 2017) 29, 33 Lindy Bros. Builders, Inc. of Phila. v. Am. Rad. Std. Sanitary Corp, 540 F.2d 102 (3d Cir. 1976) 42, 43, 44 Matter of Continental Illinois Sec. Litig, 962 F.2d 566 (7th Cir. 1992) 42 McKenzie Constr. Inc. v. Maynard, 758 F.2d 97 (3d Cir. 1985) 35 McKenzie Constr. Inc. v. Maynard, 823 F.2d 43 (3d Cir. 1987) 35 Planned Parenthood of Cent. New Jersey v. Att?y Gen. of New Jersey, 297 F.3d 253 (2002) 17 Rode v. Dellarciprete, 892 F.2d 1177 (3d Cir. 1990) 28 Student Pub. Int. Research Grp. of New Jersey 12. AT Bell Laboratories, 842 F.2d 1436 (3d Cir. 1988) 43 US. v. Cianfrani, 573 F.2d 835, 851 (3d Cir. 1978) 33 Case: 18-2012 Document: 003113316560 Page: 9 Date Filed: 08/09/2019 Statutes 28 U.S.C. 1291 1 28 U.S.C. 1332(d). 1 Other Authorities Paul M. Barrett, Will Brain Injury Doom the BLOOMBERG BUS1NESSWEEK, Feb. 21, 2013 48, 49, 52 Vi Case: 18?2012 Document: 003113316560 Page: 10 Date Filed: 08/09/2019 STATEMENT OF JURISDICTION The district court had original jurisdiction over this matter pursuant to 28 U.S.C. 1332(d). This brief addresses the May 24, 2018 order of the district court allocating common-bene?t attorney fees. JA8971. That ruling constitutes a ?nal order subject to immediate appeal over which this Court has jurisdiction pursuant to 28 U.S.C. 1291. See Interfaith Community Org. v. Honeywell Intern, Inc., 426 F.3d 694, 702?703 (3d Cir. 2005). Locks Law Firm ?led a timely notice of appeal following the court?s denial of its motion for reconsideration. JA42. ISSUES PRESENTED JOINT APPELLANTS: Did the district court commit legal error and Violate due process when it delegated responsibility for the allocation of common bene?t fees in this multi- district litigation to Co?Lead Counsel Christopher Seeger of Seeger Weiss LLP, the most interested party in the allocation, and approved a unilateral process that lacked transparency and basic mechanisms of fairness and accountability? LOCKS LAW FIRM: Did the district court employ a legally erroneous standard, rely on clearly erroneous factual ?ndings, and abuse its discretion when it approved Mr. Seeger?s proposed award to Locks Law Firm (LLF), which improperly excluded common- Case: 18-2012 Document: 003113316560 Page: 11 Date Filed: 08/09/2019 bene?t time from the ?rm?s lodestar and applied a lower multiplier to LLF than that applied to other ?rms in similar roles? LLF objected to the fee allocation process and the fee award lVLr. Seeger proposed, and renewed its objections after the allocation hearing, The court rejected these objections. JA8971. LLF ?led a motion for reconsideration on its individual allocation after the court issued the fee award. The court denied the motion. A1 17. RELATED CASES AND PROCEEDINGS This Court heard an appeal from the order of the district court certifying the class and approving the settlement in this action. The Court af?rmed that order in a decision ?led April 18, 2016, as amended May 2, 2016, and reported at 821 F.3d 410. The Court also rejected a prior appeal taken from the district court?s preliminary approval of an earlier proposed class settlement, ?nding that action was not immediately appealable. The Court?s decision was ?led December 24, 2014 and reported at 775 F.3d 570. As relevant to this consolidated appeal, the Alexander Objectors ?led a notice of appeal from the district court?s January 16, 2019 order granting a subsequent petition for common-bene?t fees. JA671 (Doc. 10428). See Case No. 19-1385. Case: 18-2012 Document: 003113316560 Page: 12 Date Filed: 08/09/2019 STATEMENT OF THE CASE This consolidated appeal arises from rulings by the district court on a fee award for attorneys who performed common-bene?t work in the National Football League concussion injury litigation, and also rulings concerning compensation of attorneys who represent former players through individual retainer agreements. This brief addresses the allocation of $112.5 million in common-bene?t fees and costs, the district court?s decision to delegate responsibility for that allocation to the largest recipient of those fees, Co-Lead Counsel Christopher Seeger, and the improper process that lVlr. Seeger and the court employed. The NFL Concussion Iniurv Litigation Former football players have suffered grave harm from repeated head injuries while playing for the NFL. Many have experienced lifelong physical, mental and emotional disability and early death from a range of diseases and conditions that include amyotrophic lateral sclerosis (ALS or Lou Gehrig?s disease), Alzheimer?s disease, Parkinson?s disease, chronic traumatic encephalopathy (CTE), and dementia that severely impact the basic activities of daily life. Starting in July 2011, hundreds of former players brought suit against the NFL in state and federal courts alleging that the NFL knew for decades that players were at serious risk from head injury and violated their duty of care by failing to take reasonable steps to ensure player safety, fraudulently minimizing risk, and Case: 18-2012 Document: 003113316560 Page: 13 Date Filed: 08/09/2019 suppressing information. See In re Nat?l Football League Players? Concussion Injury Litig, 821 F.3d 410, 421?422 (3d Cir. 2016) Concussion Injury In January 2012, on motion from the NFL and with the endorsement of LLF and other leading attorneys for retired players, the Judicial Panel on Multidistrict Litigation consolidated these cases as an MDL and transferred the proceeding to Judge Anita Brody of the Eastern District of JA135 (Doc. 1). The district court then issued its ?rst Case Management Order, instructing attorneys for retired players to confer on the formation of a plaintiff? 3 management structure and submit applications for the position of lead counsel. On April 26, 2012 the court appointed a Plaintiffs? Executive Committee consisting of two attorneys each from the ?rms Anapol Weiss, Girardi Keese, Hausfeld, Locks Law Firm, Podhurst Orseck, and Seeger Weiss, and also a Plaintiffs? Steering Committee with seven additional attorneys, later expanded by several more. The Executive Committee was tasked with coordinating and managing all pretrial proceedings and administrative duties, and the Steering Committee was charged with performing pretrial tasks. The court appointed Mr. Seeger as Co-Lead Counsel and instructed the Executive Committee to choose a Philadelphia-based lawyer as a second Co-Lead Counsel, later selected to be Sol Weiss of Anapol Weiss. The Executive Committee had proposed nominating three Case: 18-2012 Document: 003113316560 Page: 14 Date Filed: 08/09/2019 attorneys from their ranks to serve as co?lead counsel, but the court informed them it wanted Mr. Seeger in that position. A72 l?J A722. From that point forward, the court dealt exclusively with Mr. Seeger in all matters relating to the management and progress of the litigation for plaintiffs. Mr. Weiss performed a signi?cant amount of work in his capacity as Co-Lead Counsel as did other Executive and Steering Committee members, but the court empowered only Mr. Seeger to communicate directly with the court and exercise managerial authority over the case for plaintiffs. The Early Phase of the Litigation With the management structure of the MDL established, plaintiffs ?led two superseding Master Complaints in summer 2012: a long-form complaint and a class action complaint. JA251 (Doc. 2642), JA143 (Doc. 84). The parties then briefed and argued a motion to dismiss in which the NFL asserted that collective bargaining agreements that bind many former players preempted the state-law tort claims. (Docs. 3589 3590). In parallel with work relating to the pleadings, members of the Executive and Steering Committees created the infrastructure of this litigation. Multiple firms consulted extensively with medical and legal experts to develop the substantive expertise to conduct discovery and prepare for trial on the modalities of cognitive impairment resulting from traumatic brain injury, held public meetings with former Case: 18-2012 Document: 003113316560 Page: 15 Date Filed: 08/09/2019 players, and developed a communications strategy to keep players informed about the proceedings and put pressure on the NFL. The Class Action Settlement After the motion to dismiss was submitted, the court appointed retired District Judge Layn Phillips to facilitate settlement negotiations between the NFL and plaintiffs. Co-Lead Counsel Sol Weiss, Executive Committee members Steve Marks and Gene Locks, and others participated in the negotiation process and performed supportng work, including valuation of claims, analysis of proposed term sheets, development of protocols for medical evaluation of former players, and claim-processing procedures. Throughout, the court gave Mr. Seeger responsibility for leading negotiations with the NFL and used him as its sole point of contact for plaintiffs. These negotiations resulted in a proposed class settlement. The settlement established a Monetary Award Fund (MAF) enabling players diagnosed with certain neurological diseases to receive compensation without having to prove that the malfeasance caused their injuries, created a Baseline Assessment Program (BAP) that provided neurological evaluations to players at no cost, and set up an Education Fund to provide information about player safety and assistance under the Collective Bargaining Agreement. The MAF compensated players Case: 18-2012 Document: 003113316560 Page: 16 Date Filed: 08/09/2019 according to the severity of their neurological disease by establishing siX Qualifying Diagnoses: Level 1.5 and 2.0 Neurocognitive Impairment, Alzheimer?s Disease, Parkinson?s Disease, ALS, and CTE. Monetary awards would vary depending on a claimant?s Qualifying Diagnosis, age, and number of eligible seasons played, and awards would be reduced for players with prior medically diagnosed stroke or traumatic brain injury. 03 A1038. Mr. Seeger agreed to cap the MAP at $675 million in this initial settlement, JA1078, meaning former players would seek compensation from a fund that might provide no remedy if the number and severity of claims exceeded projections. The settlement also provided that the NFL would not object to any request by plaintiffs? counsel for common-bene?t fees and costs up to $112.5 million, an amount the NFL agreed to pay in addition to the MAP and other settlement bene?ts. JA1121. When the parties presented this deal to the court and sought preliminary approval of a class settlement, the court rejected the request. It held the amount of the capped fund was inadequate and risked leaving former players with no remedy. JA1471. The court directed the parties to revisit their forecasts and negotiate toward a settlement with an uncapped fund. With the assistance of Special Master Perry Golkin, the parties agreed to a revised settlement that uncapped the MAP and modi?ed some other terms. A2 143 (describing revised settlement). Case: 18-2012 Document: 003113316560 Page: 17 Date Filed: 08/09/2019 On July 7, 2014, the court issued an order granting preliminary approval to the revised settlement and directing that notice be provided to the class. The court appointed Mr. Seeger and Mr. Weiss as Co-Lead Class Counsel, Mr. Locks and Mr. Marks as Co-Class Counsel, and Arnold Levin and Dianne Nast as Subclass Counsel for future and currently injured players, respectively. JA2121. Following an unsuccess?ll attempt by objectors to take an immediate appeal, the court held a fairness hearing on November 19, 2014. JA4542. Class counsel and the NFL presented arguments in support of the settlement while objectors argued that it was inadequate. The court ?proposed several changes to bene?t class members? following the hearing, NFL Concussion Injury I, 821 F.3d at 423, and the parties submitted a revised settlement. JA5842. On April 22, 2015, the court certi?ed the class and granted ?nal approval to the settlement. JA6131. This Court af?rmed. See In re Nat?l Football League Players Concussion Injury Litig, 307 F.R.D. 351 (ED. Pa. 2015), NFL Concussion Injury I, 821 F.3d at 420. The Common-Bene?t Fee Petition On February 13, 2017, while the work of implementing the settlement was still underway, Mr. Seeger petitioned the court to award the full amount of common-bene?t fees and expenses that the NFL agreed not to oppose under the settlement: $112,500,000. JA6555. In fall 2016, in preparation for submitting the fee petition, Mr. Seeger instructed attorneys seeking common-bene?t fees to Case: 18-2012 Document: 003113316560 Page: 18 Date Filed: 08/09/2019 provide his ?rm with itemized time sheets for work they wanted compensated. Mr. Seeger made the sole determinations of what work performed by other Executive and Standing Committee members quali?ed for common-bene?t compensation in his petition, in some cases excluding time without notifying attorneys in advance or providing an explanation. Neither Mr. Seeger nor the court used an independent auditor or special master for this task. Although Mr. Seeger reviewed and adjusted time and expense records for all other ?rms applying for common-bene?t fees, other ?rms had no access to his time and expense records. To this day, no Appellant has seen those records. After Mr. Seeger made determinations about what time would be eligible for compensation, he instructed other ?rms to provide declarations describing their common-bene?t work. The declarations were included as exhibits to the fee petition. JA474 (Doc. 7151). They included only top?line ?gures for total hours billed by attorneys and staff, along with narrative accounts of the work performed. For example, the supporting data for Mr. Seeger?s nearly $7,000,000 personal lodestar ?gure consists of the following entry: NAME HOURS HOURLY AMOUNT RATE Christopher A. Seeger 6,955.90 985 $6,851,561.50 JA6680. Case: 18-2012 Document: 003113316560 Page: 19 Date Filed: 08/09/2019 On April 5, 2018, the court awarded the full amount of common-bene?t fees and expenses requested in the petition: $106,817,220.62 in fees to be placed in a fund for subsequent allocation and $5,682,779,38 in expenses. JA8767. The court relied on the percentage-of-recovery method, using lodestar as a cross-check. The court indicated that it had requested and received from Mr. Seeger ?the time records from these ?rms for in camera review.? JA8780. These were the adjusted time records re?ecting Mr. Seeger?s decisions about what time would be compensated. Mr. Seeger?s Proposed Fee Allocation On September 11, 2017, while the fee petition was still pending, the court issued a one-paragraph order delegating responsibility to Mr. Seeger to propose an allocation of common-bene?t fees for himself and other ?rms. JA7920. Mr. Seeger used the lodestar method, basing his proposal on the time records he had collected and adjusted and instructng ?rms to submit any additional time they had logged since their initial declarations, which he again unilaterally adjusted. He also retained an expert, Professor Brian Fitzpatrick of Vanderbilt Law School, to write an opinion in support of his proposal. JA7967. Professor Fitzpatrick ?conferred with [Mr. Seeger] and reviewed the declarations by the various ?rms that worked on this case? in preparing his opinion. JA7968. 10 Case: 18-2012 Document: 003113316560 Page: 20 Date Filed: 08/09/2019 On October 10, 2017, Mr. Seeger ?led his proposed allocation with the court. Having served as the gatekeeper for what time would be included in lodestar ?gures, Mr. Seeger now decided the ?relative value of the contributions made by each of the ?rms to bring the eventual bene?ts of the Settlement to the Settlement Class? and the lodestar multipliers they should receive. JA7948. Mr. Seeger did not negotiate these ?gures with other ?rms. Mr. Seeger assigned the highest multiple to himself, proposing that his lodestar be enlarged by a factor of 3.885. Multipliers for other ?rms ranged from 2.5 for Mr. Levin to no multiplier or a downward adjustment of .75. The only proposed multiplier that approached Mr. Seeger?s was for Professor Samuel Issacharoff at 3.55. Mr. Seeger?s proposal recommended a total award to his ?rm of over $70 million, about 65% of the total available common-bene?t compensation. JA7956. The court gave other ?rms an opportunity to submit counter-declarations, and Mr. Seeger ?led an omnibus reply. These submissions were completed by November 17, 2017. JA576 (Doc. 8900). The Fee Allocation Hearing The court held a hearing on May 15, 2018 concerning the allocation of common?bene?t fees. The hearing began with Mr. Seeger presenting his proposal. Each ?rm then had ten minutes to make arguments, followed each time by ten minutes for Mr. Seeger to reply. 11 Case: 18-2012 Document: 003113316560 Page: 21 Date Filed: 08/09/2019 At several points in the hearing, the court emphasized its inability to make independent judgments on key aspects of the fee allocation petition, explaining that it felt the need to defer to Mr. Seeger: 0 In a colloquy with Mr. Seeger following the presentation by LLF, the court described its ?use of you Seeger], who I think knows more about this case than and went on to acknowledge: mean, you have been the face of the case, and, frankly, you?re the only one that faced the Court. The only one. Maybe Mr. Professor Issacharoff, when he told me that he?s sure he can get class certi?cation . . . But the reality is that you were the face of it, and you were the only person that I that interacted with the Court, other than the than the argument we had.? JA9117. - When Steering Committee member Derriel McCorvey emphasized problems with the process underlying the allocation, the court explained why it had delegated unilateral authority to Mr. Seeger: have to take some responsibility on that [referring to the allocation process] because frankly, [Mr. Seeger] was the face that I saw for years, he and Mr. Professor Issacharoff are the people that I?ve seen for years and years and years and they have been the face of this and I have felt that they would be in the best position. . . . I probably I will reevaluate but it think [sic] that they I think I still believe, that he but I will certainly reconsider it, whether or not he is in the best position to allocate.? JA9172. - During the same argument, when Mr. McCorvey emphasized that Mr. Seeger had horded common-bene?t work for himself and urged the court to take that fact into account when considering the multipliers Mr. Seeger was proposing, Mr. McCorvey said ?But frankly, your Honor, since the terms sheet was reached in 2013, we were pretty much the PSC and the PSC [sic], we were excluded from that process and the court responded, ?Well that I can?t that?s something that?s very hard . . . for me to adjudicate on.? JA9173. 12 Case: 18-2012 Document: 003113316560 Page: 22 Date Filed: 08/09/2019 Multiple Appellants objected to the process Mr. Seeger and the court employed in the allocation. Co-Lead Counsel Anapol Weiss urged the court to appoint a special master to conduct a fair assessment of the time and relative contributions of each ?rm. JA8020. LLF urged a committee process Where applicants could engage in negotiations to arrive at consensus on most questions about the size and content of lodestar ?gures and the assignment of multipliers. A91 A91 14. The court rejected these recommendations. In response to a request at the hearing by Mr. McCorvey that the court appoint a special master so that Mr. Seeger would not be deciding his own allocation, the court responded: THE COURT: He?s not deciding. MR. MCCORVEY: Well, you?re right, Your Honor, he?s not -- THE COURT: I?m the Special Master. MR. MCCORVEY: Yes, Your Honor. THE COURT: Take a look at her. MR. MCCORVEY: Yeah, I stand corrected. THE COURT: Here she is. JA9172. See also JA9177 (responding to the presentation of Steven Molo, the court insisted -- and I think I?m the Special Master here?). 13 Case: 18-2012 Document: 003113316560 Page: 23 Date Filed: 08/09/2019 The Fee Allocation Order Nine days after the hearing, on May 24, 2018, the court issued its decision. JA8971. The court allocated $85,619,466.79 of the available fund for immediate payment of common-bene?t fees and reserved $22,823,253.33 for future payment ?as attorneys continue to work to implement this Settlement Agreement.? JA8995. The court accepted Mr. Seeger?s lodestar hours for all ?rms, making his changes to those ?gures the last word. The court adjusted the billing rate for some lodestars, taking the average rate among all those submitted in each category (partners, associates) and making reductions where a ?rm?s overall rates exceeded those averages. On the question of multipliers, the court provided a short summary of each ?rm?s work, relying largely on descriptions contained in Mr. Seeger?s proposal, and adopted his multipliers in most respects, making only a few minor adjustments described further below. The adjustment to billing rates and a slight decrease in multiplier from 3.885 to 3.5 together reduced Mr. Seeger?s immediate award from $70,415,116.45 (about 66% of the total available fees) to $51,737,185.70 (about 60% of the total fees awarded by the court), a difference of $18,677,930.75. JA8991. Mr. Seeger has since ?led three additional petitions for payment from the remaining fund reserved for continued implementation of the Settlement. The court 14 Case: 18-2012 Document: 003113316560 Page: 24 Date Filed: 08/09/2019 granted the ?rst petition on January 16, 2019, awarding $9,381,961.06 in fees and costs, of which Mr. Seeger received $8,270,349.01 (about JA126. The second, which remains pending, requests $3,195,634.43 in fees and costs, of which Mr. Seeger claims $2,701,569.41 (about JA9398. The third, which remains pending. requests $1,689,276.76 in fees and costs, all for Mr. Seeger. JA9441. Between granted and pending petitions, this is $12,661,195.18 more in fees and costs for Mr. Seeger so far. The initial reduction in his award was simply deferred compensation. On May 24, 2019, the court terminated all appointments of co-lead counsel, class counsel, and the Executive and Standing Committees. In their place, the court reappointed Mr. Seeger as sole class counsel. It appears that further awards of common-bene?t fees will be available only to Mr. Seeger. 15 Case: 18-2012 Document: 003113316560 Page: 25 Date Filed: 08/09/2019 SUMMARY OF ARGUMENT The district court employed a process for the allocation of common-bene?t fees that violated basic principles of fairness and due process. 1. The court delegated exclusive responsibility to the most interested party in the dispute, Mr. Seeger, who conducted a unilateral, opaque process with no mechanisms of consensus or accountability. 2. Mr. Seeger?s time records were never available for adversarial scrutiny and never entered on the record, violating due process and frustrating appellate review. 3. The court acknowledged at the allocation hearing and again in its ruling that it had insuf?cient information to exercise independent scrutiny, had only dealt with Mr. Seeger, had to defer to Mr. Seeger, and was unable to evaluate key questions about hours billed and value added. 4. These inadequate procedures cannot be justi?ed by practical constraints. In the related task of resolving disputes over competing claims for attorney fees in the representation of individual claimants, the court already employs a robust process exhibiting the fairness and transparency that were absent in the allocation of common-bene?t fees. 5. The fee allocation violates this Court?s requirements for fee awards based on lodestar analysis and is not supported by substantial record evidence. 16 Case: 18-2012 Document: 003113316560 Page: 26 Date Filed: 08/09/2019 STANDARD OF REVIEW This Court ?review[s] de novo the standards and procedures applied by the District Court in determining attorneys? fees, as it is a purely legal question.? Planned Parenthood of Cent. New Jersey v. Atty Gen. of New Jersey, 297 F.3d 253, 265 (2002). This Court reviews the fee allocation for abuse of discretion. In re Diet Drugs Prods. Liab. Litig, 582 F.3d 524, 538 (3d Cir. 2009). The Court reviews the evidentiary suf?ciency of the fee allocation for clear error. Interfaith Community Org. v. Honeywell Intern, Inc., 726 F.3d 403, 416 (3d Cir. 2013) [Interfaith ARGUMENT OF JOINT APPELLANTS The district court?s May 24, 2018 order allocated common-bene?t fees among lawyers who were, for purposes of that order, adverse parties making competing claims on a limited fund. Nonetheless, the court took the most interested party in that dispute, Mr. Seeger, and empowered him to exercise unilateral authority over the lodestar ?gures that other ?rms would submit, employing a process that lacked the transparency and accountability an independent auditor or special master would have offered. The court then empowered Mr. Seeger to assign multipliers to those lodestars, enabling him to reward himself and penalize rivals without any on?the-record scrutiny of his own time records. The court accepted Mr. Seeger?s multipliers with only minor 17 Case: 18-2012 Document: 003113316560 Page: 27 Date Filed: 08/09/2019 adjustments, stating both at the hearing and in its order that it had insuf?cient information to make independent judgments about key aspects of his proposal. There is no justi?cation for this manifestly inadequate process. Precedents from other large MDLs and the district court?s own approach to resolving competing claims on individual retainer agreements both demonstrate that practicable options were available for a fair and reliable allocation of common- bene?t fees. The court?s order rests on legal error, and the failure to make Mr. Seeger?s time records available for adversarial scrutiny violates due process. This Court should vacate the allocation order and remand with instructions that the district court perform a new allocation using a fair process. I. THE PROCEDURES THE DISTRICT COURT USED TO ALLOCATE COMMON-BENEFIT FEES LACKED FAIRNESS, TRANSPARENCY AND ADEQUATE SUPERVISION. The most thorough analysis this Court has provided of the procedures district courts should employ in allocating common-bene?t fees comes from the Diet Drugs litigation, presided over by US. District Judge Harvey Bartle. See In re Diet Drugs Prods. Liab. Litig, 582 F.3d 524 (3d Cir. 2009) [Diet Drugs see also In re Diet Drugs Prods. Liab. Litig, 401 F.3d 143, 167?174 (3d Cir. 2005) [Diet Drugs 1] (Ambro, ., concurring). In Diet Drugs 11, this Court affirmed a fee allocation order in which the district court: 18 Case: 18-2012 Document: 003113316560 Page: 28 Date Filed: 08/09/2019 - appointed a neutral auditor to review and approve time records submitted by attorneys for inclusion in their lodestar; - sought proposals from all interested attorneys on the most appropriate process to employ in arriving at an allocation of common-bene?t fees; - received a consensus allocation approved by all members of the Plaintiffs? Management Committee and nearly all attorneys claiming common?benefit fees; and - permitted limited discovery by objecting applicants, allowing them to probe areas of disagreement in the underlying time records and the relative contributions of common-bene?t attorneys. See In re Diet Drugs Prods. Liab. Litig, 553 F. Supp. 2d 442, 458?463 (E.D. Pa. 2008), Diet Drugs 11, 582 F.3d 524 (3d Cir. 2009). These fee allocation procedures were a gold standard, exhibiting transparency, reliability and basic fairness ?more than adequate? to satisfy the ?thorough judicial review? required of a common-bene?t fee application in a federal class action or Diet Drugs II, 582 F.3d at 537?539, 547. Diet Drugs left open the question how far a district court can depart from these best practices before it commits legal error. See also Diet Drugs I, 401 .3d at 167 (Ambro, ., concurring in part and dissenting in part) (noting the Third Circuit?s ?prior lack of exploration of the issues involved in such an allocation?). The present appeal 19 Case: 18-2012 Document: 003113316560 Page: 29 Date Filed: 08/09/2019 requires this Court to enforce a procedural baseline. The district court declined to employ any of the best practices used in Diet Drugs, instead delegating unilateral authority to the attorney who had the most at stake in the allocation. This was error, and the failure to make Mr. Seeger?s time records available for scrutiny on the record is a violation of due process that alone requires reversal. A. The District Court Authorized Mr. Seeger to Conduct a Unilateral, Non-Transparent Allocation Process Without Negotiation, Consensus, or an Auditor or Special Master. By placing Mr. Seeger in sole control of the review of time records and the proposal of a ?nal allocation of common-bene?t fees, the district court maximized the problem of con?ict of interest. Mr. Seeger was the most interested party in the fee allocation, and the power the court conferred on him to control the assignment of common-bene?t work and serve as the court?s sole point of contact throughout the litigation gave him a singular capacity to control information about the relative contributions of other ?rms. The court had options available that would have mitigated this con?ict of interest: use of an auditor or special master to examine time records and the contributions of ?rms seeking compensation, or appointment of a committee to conduct negotiations and arrive at a consensus allocation. As this Court has explained, negotiation of a fee allocation among common-bene?t counsel is an ?accepted practice.? In re Warfarin Sodium Antitrust Litig., 391 F.3d 20 Case: 18-2012 Document: 003113316560 Page: 30 Date Filed: 08/09/2019 516, 533 n.15 (3d Cir. 2004). By refusing these options, the court intensi?ed the structural con?ict. In his concurring opinion in Diet Drugs I, Judge Ambro warned of the potential for con?icts of interest in a fee allocation. That con?ict is ?inherent,? he explained, where counsel ?make recommendations on their own fees and thus have a financial interest in the outcome.? Diet Drugs I, 401 F.3d at 173 (Ambro, J., concurring). When a court examines a proposed allocation or reviews a fee award, ?How much deference is due the fox who recommends how to divvy up the chickens?? Id. Judge Ambro urged a ?sliding scale approach to the standard of review? that would allow courts ?to examine critically decisions of non-judicial bodies that may have a ?nancial interest in the outcome of their decisions or recommendations? and explained, ?when a con?ict of interest is present, the reviewing court should consider on a fact-speci?c basis how much deference should be afforded to the views of a group potentially affected by self-dealing.? Id. In Diet Drugs II, Judge Ambro again emphasized the need for searching scrutiny where con?icts of interest threaten the allocation process. When ?presented with a proposal that bene?tted a group that was a party to the proposal . . . at the expense of group [sic] that was not a party to it,? he explained, ?the District Court [is] required to subject that proposal to extra scrutiny.? Diet Drugs II, 582 F.3d at 557 (Ambro, ., concurring in part and dissenting in part). When the 21 Case: 18-2012 Document: 003113316560 Page: 31 Date Filed: 08/09/2019 court ?adopt[s] [the proposing attorney?s] ?awed reasoning more or less in full,? it ?suggests . . . that such scrutiny was not applied.? Id. Diet Drugs addressed the con?ict of interest problem by appointing an independent auditor to review time records, seeking input from interested counsel on the best way to approach the allocation, and receiving a negotiated proposal that had the consent of all members of the plaintiffs? leadership team and most other interested attorneys. In contrast, the district court here delegated authority to the most interested party, allowed him to exercise unilateral control over the review of time records, and approved an allocation that provoked sharp objections from the plaintiffs? leadership team including Co-Lead Counsel Anapol Weiss. In the fee allocation hearing, Mr. Seeger responded to arguments about the advisability of a negotiated approach to the allocation by saying, ?As far as the committee, I would have had no objection to it. Your Honor chose to ask me to make recommendations.? JA9117. But nothing prevented Mr. Seeger from conducting a transparent and collaborative process. The court?s order conferring authority on Mr. Seeger reads, in its entirety: AND NOW on this 11th day of September, 2017, to assist this Court in determining the proper allocation and division of class counsel attorneys? fees, it is ORDERED that Co-Lead Counsel, Christopher A. Seeger, submit a detailed submission as a proposal for the allocation of lawyers? fees among class counsel including the precise amounts to be awarded along with a justi?cation of those amounts based on an analysis of the work performed. 22 Case: 18-2012 Document: 003113316560 Page: 32 Date Filed: 08/09/2019 JA7920. The opaque, unilateral process that followed was Mr. Seeger?s invention, and the district court rati?ed it. The Vioxx litigation provides another stark comparison to the inadequate process used here. To counteract the danger of monopoly and self-dealing in a fee allocation, the court in Vioxx took steps ?from the very beginning of [that] and before the Settlement Agreement was contemplated or announced, . . . to create a fair and open environment for all interested attorneys to perform work for the common bene?t of the plaintiffs and to create a transparent factual record for an eventual application for common bene?t fees.? In re Vioxx Prods. Liab. Litig, 802 F. Supp. 2d 740, 762 (ED. La. 2011). That process included an independent auditor to review time and expense submissions, an eight-attomey committee to negotiate proposed common-bene?t fee awards, and appointment of a special master ?who had no ?nancial interest in the awards? to ?conduct[] discovery and mak[e] his own recommendation.? Id. at 773?774. The committee and the special master made separate recommendations for the 102 ?rms seeking common-bene?t fees, and the court issued decisions on each ?rm, sometimes accepting one of the competing recommendations and sometimes departing from both. A district court in Ohio employed similar procedures in an MDL involving contaminated drinking water. In re E.I. Du Pont de Nemours and Company Pers. Inj. Ling, No. 2018 WL 4771524, adopted and ordered, 23 Case: 18-2012 Document: 003113316560 Page: 33 Date Filed: 08/09/2019 2018 WL 4810290 (S.D. Ohio Oct. 3, 2018). The court required submission of all common-bene?t time in an open process, instructed a fee committee to make recommendations for an appropriate allocation, appointed a special master to oversee and participate in the work of the committee and directly review time submissions, and required the special master to make his own allocation proposal. Id. at These ?extensive mediation efforts? resolved ?all objections to the fee and expense allocations? and produced a consensus fee award. Id. at The court below employed no such front?end procedures to ensure transparency, minimize con?ict of interest, or promote consensus in the fee allocation. It departed too far from the gold standard approved by this Court in Diet Drugs and failed to safeguard the ?basic principles of fairness? this Court requires. Diet Drugs II, 582 F.3d at 547. B. Mr. Seeger?s Time Records Were Not Subject to Adversarial Scrutiny, Not Disclosed to Any Other Firm, and Not Independently Reviewed. 1. The District Court?s Failure to Make Time Records Available for Review On the Record Violates Due Process. One element of the procedure below is a stand-alone violation of the Due Process Clause: the lack of on-the-record, adversarial scrutiny for the time that Mr. Seeger claims in the lodestar for his ?rm. Every other ?rm was required to submit time records to Mr. Seeger for review and unilateral adjustment, but Seeger Weiss never disclosed its hours for scrutiny by other firms. To this day, no Appellant has 24 Case: 18-2012 Document: 003113316560 Page: 34 Date Filed: 08/09/2019 seen Mr. Seeger?s time records. Neither will this Court: those records were never made part of the record below. The court?s failure to make Mr. Seeger?s time available for scrutiny when Mr. Seeger had access to the records of other ?rms and unilaterally adjusted them is a violation of due process. The Due Process Clause requires that the evidence supporting a court?s resolution of a contested fee allocation be available for review and subject to adversarial scrutiny, and that all claimants have equal access to a fair process. As the First Circuit has explained, when a court imposes ?a rigid limitation [on] one affected group?s input into [a contested fee allocation] while giving members of the other affected group a much broader array of participatory rights,? it fails to provide the disadvantaged group ?a constitutionally adequate chance to be heard.? In re Nineteen Appeals Arising Out of San Juan Dupont Plaza Hotel Fire Litig., 982 F.2d 603, 613 (lst Cir. 1992). In Nineteen Appeals, the district court had limited the ability of one group of fee applicants to participate in an evidentiary hearing or submit detailed objections while other firms were allowed to do both. See id. at 612?613. Here the issue is access to the information necessary to craft objections at all. The court below empowered Mr. Seeger to review and adjust the time records of adverse parties while giving these adverse parties no access to his own records. As a result, Appellants had no adequate opportunity to be heard on the validity of Mr. Seeger?s lodestar. Due process gives courts many options in 25 Case: 18-2012 Document: 003113316560 Page: 35 Date Filed: 08/09/2019 determining what procedures to use in resolving a fee allocation, but ?when a judge constructs aprocess for setting fees, . . . those procedures must apply in a fair and evenhanded manner to the parties in interest, without preferring one group of disputants over another.? Id. at 614?615. When the First Circuit heard a second appeal in the hotel ?re case, it found that the district court had cured the due process problems that marred its ?rst allocation because it employed procedures that ?compelled exchange of documentation? and ?ensured that the [adverse parties] had access to all the data reasonably necessary to formulate their objections, including all the PSC members? time-and?expense submissions, summaries thereof, detailed accounts of the procedures used by the PSC to gather, review, and audit time records, and the working papers, correspondence, and documentation generated by the accountants during the compilation process.? In re Thirteen Appeals Arising Out of San Juan Dupont Hotel Fire Litig., 56 F.3d 295, 303 (lst Cir. 1995). These are precisely the materials the court failed to make available to Appellants here. Firms objecting to Mr. Seeger?s self-assigned lodestar have a right to probe whether his records are padded with in?ated or redundant hours. When a court uses lodestar amounts as the basis for a fee award, this Court has repeatedly held that time records underlying those lodestars must be available for adversarial scrutiny and the court itself must perform a detailed review. See, 26 Case: 18-2012 Document: 003113316560 Page: 36 Date Filed: 08/09/2019 e. American Bd. of Intern. Med. v. Von Muller, 540 Fed. App?x 103, 107 (3d Cir. 2013) (where district court ?acknowledged expressly that the lodestar ?gure was the starting point for determining a reasonable award . . . it was obliged to review the time charged, decide Whether the hours set out were reasonably expended for each of the particular purposes described and then exclude those that are excessive, redundant or otherwise unnecessary?) (quotation omitted). It is only where a court bases a fee award on the percentage-of?recovery method and uses the lodestar as a cross-check that it ?may rely on summaries submitted by the attorneys and need not review actual billing records.? In re Rite-Aid Corp. Securities Litig, 396 F.3d 294, 306?307 (3d Cir. 2005). Accord In re Prudential Ins. Co. Am. Sales Practice Litig. Agent Actions, 148 F.3d 283, 341?342 (3d Cir. 1998). Mr. Seeger used lodestar values as the foundation of his proposed allocation. Those lodestars were based on time records that only Mr. Seeger saw and adjusted. The court adopted Mr. Seeger?s adjusted lodestars without changing a single entry, without seeing the original time records, without entering any time records on the docket, and without giving other ?rms access to Mr. Seeger?s time. This process denied Appellants an ?adequate opportunity to be heard? on the fee allocation. In re Fine Paper Antitrust Litig., 751 F.2d 562, 584 (3d Cir. 1984). The impact of this in?rm process is not limited to Appellants. Appellate courts must also have access to time records in order to review a lodestar ruling. 27 Case: 18-2012 Document: 003113316560 Page: 37 Date Filed: 08/09/2019 This Court ?cannot af?rm the disallowance of hours without adequate time record support unless the trial court identi?es the entries in question. More speci?c ?ndings are essential.? Fine Paper, 751 F.2d at 596. Where challenged lodestar hours are approved or disapproved with no evidentiary record, ?[t]he district court?s failure to make an adequate record . . . precludes [the circuit court] from properly discharging [its] reviewing function.? Rode v. Dellarcz'prete, 892 F.2d 1177, 1187 (3d Cir. 1990). In a dispute over a fee application in a bankruptcy proceeding, for example, this Court noted that ?only a total hourly listing was supplied to the court? and held that ?[n]either the District Court, nor this court in reviewing the record on appeal, can be expected to render an appropriate decision in the absence of adequate time records.? In re Imperial ?400? Nazi, Inc., 432 F.2d 232, 239 (3d Cir. 1970). A ?total hourly listing? of attorney and paralegal time is the only account of Mr. Seeger?s lodestar entered on the record below. In its April 5, 2018 order awarding the total amount of common-bene?t fees, the district court indicated that it had received from Mr. Seeger the ?[adjusted] time records from these ?rms for in camera review.? JA8780. Neither Appellants nor this Court have been given that privilege. ?Ex parte proceedings are an exception to the rule in our judicial system and contrary to its adversarial nature.? In re High Sulfur Content Gasoline Prods. Liab. Litig, 517 F.3d 220, 231 (5th Cir. 2008). The role of ?adverse parties . . . willing to review the [time] 28 Case: 18-2012 Document: 003113316560 Page: 38 Date Filed: 08/09/2019 records? in a contested fee application ?and object to any excesses? is vital, Komoroski 12. Utility Service Partners Private Label, Inc, No. DGK, 2017 WL 5195880, at *2 (W.D. Mo. Nov. 9, 2017), particularly where the court does not perform a thorough independent examination. Attorney fee records are not ?state secrets that will jeopardize national security if they are released to the public.? High Sulfur Content, 517 F.3d at 230. The billing records are not subject to any privilege. Cf Procaps SA. 12. Patheon Inc, No. 12-24356-CIV, 2013 WL 5928586, at (SD. Fla. Nov. 1, 2013) (rejecting attorney request to ?le billing rates under seal). There is no justi?cation here for abridging the due process requirement that the evidence relied on by a district court in ruling on a contested fee allocation be subject to adversarial scrutiny on the record and available to this court for appellate review. 2. The District Court Committed Legal Error and Made an Unreliable Allocation by Giving Mr. Seeger Unilateral Control Over Time Records. The distinctive features of this litigation cast the impropriety of these unilateral procedures in sharp relief. Mr. Seeger had a singular incentive to minimize the compensable time of other ?rms. Because the Settlement provided for a ?xed amount in common bene?t fees as the presumed total available to all ?rms, lodestar determinations had a zero-sum quality: an increase in one ?rm?s lodestar would diminish the amount of compensation available to others. And 29 Case: 18-2012 Document: 003113316560 Page: 39 Date Filed: 08/09/2019 because Mr. Seeger?s ?rm had by far the largest lodestar amount, Mr. Seeger had particular reason to be concerned about the size of other firms? awards: larger common-bene?t fees awarded to other ?rms would effectively come out of Mr. Seeger?s predominant share of the fund. Mr. Seeger acknowledged this fact at the fee allocation hearing. (argument of Mr. Hagen pointing out the zero-sum problem); (response of Mr. Seeger acknowledging the point). In addition, Mr. Seeger had few individual clients. In the entire course of the litigation, Mr. Seeger has represented approximately twenty individual players. In contrast, LLF has represented approximately 1,400 individual players, and other firms have represented many hundreds. This disparity created different incentives in the review of time records. When class members have valuable individual claims and are highly engaged as clients, lawyers must ful?ll two roles, promoting the interests of the class through common?bene?t work and serving their clients through individual representation. Drawing a distinction between these two types of work involves an exercise of judgment. For example, lawyers may devote large amounts of time to explaining the value of a proposed settlement and discussing the risk of litigation with clients who must decide whether to opt out. When the viability of the settlement depends on low opt-out rates, that work bene?ts the class (helping preserve the settlement?s viability) and the individual class member (enabling him to make an informed decision). 30 Case: 18-2012 Document: 003113316560 Page: 40 Date Filed: 08/09/2019 Mr. Seeger decided when the work of other ?rms was compensable through common?bene?t fees and when it would be excluded from the lodestar. Because he represented only a hand?il of players, adopting a conservative approach to compensation for time spent communicating with clients would have no material impact on his lodestar but could severely impact the lodestar of ?rms that represented large numbers of players and spent hundreds of hours explaining to their clients the bene?t of staying in the settlement. The impact of Mr. Seeger?s unilateral process was also evident during the fee allocation hearing. When Attorney Craig Mitnick objected to the 0.75 multiplier that Mr. Seeger applied to his lodestar, Mr. Seeger responded in part by saying: ?But I also felt that when I got his time records, I thought they were I thought there was some heavy billing that went on so I made adjustments in my judgment that I thought were fair.? JA9149. Appellants take no joint position on the merits of this assertion, but it highlights a simple fact: Mr. Seeger?s own records were never subject to adversarial scrutiny to determine whether he was guilty of ?heavy billing.? Likewise, the district court in Du Pont has emphasized the importance of scrutinizing submissions by ?attorneys who spent their time passively involved in meetings, reviewing emails, telephone conferences, or attending hearings? and contributed less to the class than their time records would indicate. Du Pont, 2018 WL 4771524 at Appellants had no opportunity to 31 Case: 18-2012 Document: 003113316560 Page: 41 Date Filed: 08/09/2019 review Mr. Seeger?s time records to make arguments about the proportion of his firm?s time that should be characterized as passive involvement. There was no reason for the court to employ a procedure that was so unbalanced and lacking in transparency. The administration of this 65-year settlement is at an early stage and more work remains to be done as the NFL continues to resist key provisions of the settlement that affect the ability of class members to recover. When faced with a similar situation, the court in Diet Drugs issued an interim award of common-bene?t fees, deferring the full award until the administration of the settlement was further along and the court could structure a fair allocation. In re Diet Drugs Prods. Liab. Litig, 553 F. Supp. 2d 442, 458?459 (ED. Pa. 2008), Diet Drugs II, 582 F.3d 524 (3d Cir. 2009). LLF unsuccessfully urged that approach on the court below. The list of other courts appointing independent professionals to scrutinize time records is long and deep. See, Diet Drugs, 553 F. Supp. 2d at 458 (auditor reviewed attorney time records); Du Pont, 2018 WL 4771524, at *3 (special master reviewed attorney time records ?in substantial detail? over the course of several months); In re Chinese-Manufactured Drywall Prods. Liab. Litig, MDL No. 09-2047, 2018 WL 2095729, at *4 (ED. La. May 7, 2018) (court appointed ?a neutral certi?ed public accountant to vet common bene?t counsels? hours? for nine years and reviewed the work on a basis); In re 32 Case: 18-2012 Document: 003113316560 Page: 42 Date Filed: 08/09/2019 Vioxx, 802 F. Supp. 2d at 762?769 (court appointed CPA and special master); Komoroski, 2017 WL 5195880, at *2 (emphasizing need to employ special master when ?summary of time records and affidavits? is insuf?cient). The court here opted instead to authorize Mr. Seeger to exercise one-sided control of information. This Court has long emphasized the importance of ?the court's oversight function? in class proceedings to address ?potential public misunderstandings . . . in regard to the interests of class counsel.? In re Gen. Motors Corp. Pick-Up Fuel Tank Prods. Liab. Litig, 55 F.3d 768, 820 (3d Cir. 1995) (citations omitted). ?Public con?dence cannot long be maintained where important judicial decisions are made behind closed doors and then announced in conclusive terms to the public, with the record supporting the court?s decision sealed from public View.? US. v. Cian?ani, 573 F.2d 835, 851 (3d Cir. 1978). The district court failed to protect those values here. The resulting allocation lacks the ?basic principles of fairness? this Court has demanded. Diet Drugs II, 582 F.3d at 547. C. The District Court Has Already Adopted a Robust Procedure for Judicial Scrutiny of Attorney Lien Disputes. There was no practical constraint preventing the district court from implementing a fair and transparent process to allocate common-bene?t fees. The court has already implemented such a process for the related task of adjudicating disputes over individual attorney fees in the representation of former players. In contrast to the common-bene?t fee allocation, the resolution of these attorney liens 33 Case: 18-2012 Document: 003113316560 Page: 43 Date Filed: 08/09/2019 exhibits transparency, even-handedness, and a careful examination of underlying time records and the relative contributions of competing attorneys. Because awards in this case are large, many players have secured counsel through individual retainer agreements to advise them and help navigate the claims process. When former players discharge attorneys because they believe an attorney performed inadequately, or new attorneys poach existing clients former counsel often place a lien on the player?s recovery to ensure payment based on their work to that point. On April 4, 2017, the court referred ?all petitions for individual attorneys? liens? to US. Magistrate Judge David Strawbridge. JA7289. Pursuant to that order, the court adopted comprehensive rules for these lien adjudications. JA9248. The Magistrate provided additional guidance on ?the legal constructs that apply generally to this lien litigation? in a January 7, 2019 opinion resolving three individual disputes. JA9293. In the same opinion, the Magistrate noted that 723 petitions for liens had been ?led by attorneys with individual retainer agreements. JA9291. Many more have been ?led since. Under the rules adopted by the court, competing parties must ?rst undertake good faith efforts to negotiate a consensus allocation of individual attorney fees. If consensus fails, each party may submit records indicating fees and costs incurred, ?a chronology of the tasks performed by the attorney, the date each task was performed, and the time spent on each task,? along with any exhibits. 34 Case: 18-2012 Document: 003113316560 Page: 44 Date Filed: 08/09/2019 JA9257. Parties submit memoranda stating their position on the disputed issues and can request a hearing that may include live testimony and argument on the record. The Magistrate then issues a report and recommendation that becomes a ?nal decision when adopted by the court. In the January 7, 2019 opinion, the Magistrate explained that analysis of time records and competing accounts of the relative value added by attorneys would be guided by this Court?s rulings in McKenzie Constr. Inc. v. Maynard, 758 F.2d 97 (3d Cir. 1985) [McKenzie and McKenzie Constr. Inc. v. Maynard, 823 F.2d 43 (3d Cir. 1987) [McKenzie employing a reasonableness standard that evaluates the ?performance of the attorney?s contractual obligations [with consideration of] the circumstances surrounding the engagement of the attorney.? McKenzie I, 758 F.2d at 101; JA9301. The Magistrate must make a contextual judgment that includes ?the quality of the work performed? by the attorney and ?whether the attorney?s efforts substantially contributed to the result.? McKenzie II, 823 F.2d at 45; The Magistrate then examined the three individual lien disputes and conducted a detailed analysis of the records submitted by each attorney, the value of their efforts in light of the point in the litigation where those efforts were undertaken, and the diagnosis and prospects for recovery for each client. JA9343 (Podhurst v. Turner); (Podhurst v. Smith); 35 Case: 18-2012 Document: 003113316560 Page: 45 Date Filed: 08/09/2019 JA9381 (CMDA V. Johnson). This analysis drew distinctions between individual representation and common-bene?t work, examining the relationship between time records submitted by Executive Committee ?rm Podhurst Orseck in the lien dispute and time the ?rm included in its lodestar for common-bene?t fees. See, The careful scrutiny the Magistrate uses in attorney lien disputes parallels the role special masters have played in fee allocations in cases like Vioxx and Du Pont. As Appellants explain below, that scrutiny stands in contrast to the lack of robust independent review that the district court applied to the fee allocation here. II. THE DISTRICT COURT DID NOT CONDUCT AN INDEPENDENT REVIEW SUFFICIENT TO CURE THE INFIRMITIES IN THE ALLOCATION PROCESS. The court did not perform an independent review of the time records and the relative contributions of counsel in this case suf?cient to counterbalance the in?rmities of Mr. Seeger?s fee allocation process. To the contrary, the court repeatedly acknowledged that it had insuf?cient information to assess the relative contributions of counsel, adopted Mr. Seeger?s allocation and multiplier recommendations with only minor adjustments, and made no adjustments to any lodestar beyond standardizing hourly rates, giving no indication in its opinion or at the hearing that it had independently audited the underlying records. 36 Case: 18-2012 Document: 003113316560 Page: 46 Date Filed: 08/09/2019 The best indication of a robust independent review in a lodestar allocation is evidence that the court analyzed the records underlying the proposed fee awards and made its own determinations about what hours should be included in the lodestar and what relative value should be assigned to common-bene?t work. See, Du Pont, 2018 WL 4771524, at In re Vioxx, 802 F. Supp. 2d at 762, 763. The Magistrate regularly performs these tasks when adjudicating attorney lien disputes. The court performed no such analysis in the fee allocation. As to lodestar amounts, the court accepted the ?gures submitted by Mr. Seeger without alteration. The only change the court made was to apply a cap on hourly rates that reduced some lodestar totals. That policy decision did not involve close scrutiny of the underlying records. As previously noted, the court never saw original time sheets from the ?rms themselves, only Mr. Seeger?s adjustments, and the record contains no suggestion that the court conducted a detailed review of even the Seeger-adjusted records. In the April 5, 2018 order awarding total fees, the entirety of the court?s treatment of the matter is a sentence that reads, ?1 determine that the hours submitted by Class Counsel are a fair and reasonable representation of the work performed.? JA8780. In the fee allocation order, the court says nothing about speci?c objections to Mr. Seeger?s unilateral exclusion of hours. 37 Case: 18-2012 Document: 003113316560 Page: 47 Date Filed: 08/09/2019 On the issue of multipliers and the relative value contributed by each ?rm, the court accepted Mr. Seeger?s recommendations with few changes, making just two small adjustments upward and three downward. Compare JA7956 with JA8980 (Girard Gibbs, 1.25 becomes (Girardi Keese, 1.0 becomes JA8981 (Goldberg, Persky White, 1.0 becomes 1.25); JA8984 (Samuel Issacharoff, 3.55 becomes 3.25); (Seeger Weiss, 3.885 becomes 3.5). And on multiple occasions, the court admitted that it could not make any independent judgment about questions bearing on relative contributions. At the hearing, the court repeatedly indicated that it had to defer to Mr. Seeger, who ?knows more about this case than and had been ?the only one that faced the Court? and ?the only person that I that interacted with the Court.? JA9117. Mr. Seeger ?was the face that I saw for years,? the court said, ?he and Mr. Professor Issacharoff are the people that I?ve seen for years and years and years.? JA9172. When Mr. McCorvey raised the issue of Mr. Seeger hording work in the MDL and argued that behavior should affect the court?s assessment of his multiplier recommendations, the court replied: ?Well that I can?t that?s something that?s very hard . . . for me to adjudicate on.? JA9173. In the allocation order, the court deferred to Mr. Seeger in its review of fee award. Mr. Seeger justi?ed the low multiplier he assigned LLF augmenting the ?rm?s lodestar by only 1.25 where other Executive Committee 38 Case: 18-2012 Document: 003113316560 Page: 48 Date Filed: 08/09/2019 members received multipliers of 2.25, 2.5, or Mr. Seeger?s 3.5 by asserting that LLF had not played an active role in crafting and advancing the Settlement and had provided an interview to a magazine that he said harmed negotiations. LLF contested both assertions. Rather than making independent ?ndings, the court indicated it was ?accept[ing]? Mr. Seeger?s assessment about work relating to the settlement and had ?to respect Co-Lead Counsel?s concerns? about the interview ?since Co-Lead Counsel led the negotiations with the NFL and is best positioned to advise me on this matter.? This Court warned in the prior appeal in this case that there was a heightened need for supervision of the fee process. Because the fee petition was delayed until after class certi?cation and ?nal approval of the settlement, ?class members may have less incentive to object to the fee award at [that] later time because approval of the settlement will have already occurred.? NFL Concussion Injury 1, 821 F.3d at 446?447. And because the common-bene?t fees were subject to a clear?sailing provision in the Settlement, ?careful scrutiny? on fees was required with an extra obligation laid on the court to ?review the process and substance of the settlement and satisfy itself that the agreement does not indicate collusion or otherwise pose a problem.? Id. at 447. Those concerns also demanded careful scrutiny in the allocation of fees. 39 Case: 18-2012 Document: 003113316560 Page: 49 Date Filed: 08/09/2019 Instead, the court empowered Mr. Seeger to run the allocation process unilaterally, accepted without analysis his adjusted lodestar ?gures, and deferred to him on key questions relating to the relative value of attorney contributions and multipliers. This ?awed process employed none of the safeguards used in Diet Drugs, Du Pont, Chinese-Manufactured Drywall or Vioxx and exhibited none of the close analysis used in attorney lien resolutions in this case. The minimal review conducted by the district court was inadequate to cure these ?aws. ARGUMENT OF LOCKS LAW FIRM The district court assigned a multiplier of 2.25 or 2.5 to the lodestar of every other ?rm in this litigation that served a role comparable to but it assigned LLF a multiplier of only 1.25. That decision was error for multiple reasons. First, the court used a ?awed standard in justifying the award. It purported to employ a lodestar methodology to allocate common-bene?t fees, but it examined none of the factors this Court requires in lodestar analysis, and it improperly minimized the importance of the up-front risk assumed by ?rms like LLF that invested effort and capital when compensation was most uncertain while in?ating the value of work done after settlement discussions began and compensation was more likely and eventually guaranteed. The only virtue of that standard was its bene?t to Mr. Seeger. This Court should reject it. 40 Case: 18-2012 Document: 003113316560 Page: 50 Date Filed: 08/09/2019 Second, the court issued ?ndings unsupported by substantial evidence. Mr. Seeger asserted that his primary reason for assigning a lower multiplier to LLF was a public interview Mr. Locks gave in a magazine. That interview was never made part of the record and Mr. Seeger?s claims were never subject to scrutiny. The court simply deferred to Mr. Seeger?s conclusory assertions and indicated it could not make an independent judgment. As to speci?c lodestar objections, the court made no ruling and developed no record at all. ?Clear error exists . . . where factual ?ndings are unsupported by substantial evidence [or] lack adequate evidentiary support in the record.? Interfaith II, 726 F.3d at 416 (quotation omitted). There is clear error here. I. THE COURT FAILED TO CONDUCT THE REQUIRED LODESTAR ANALYSIS AND EMPLOYED AN IMPROPER ALLOCATION STANDARD. The objective of any fee allocation is to distribute an aggregate award among participating attorneys in accordance with the relative value of the services each contributed to the litigation. In re Prudential, 148 F.3d at 329 n.96 (describing ?the dif?cult task of assessing counsels? relative contributions?). Here, the court purported to use the lodestar method for the allocation. In a lodestar analysis, ?the court multiplies the number of hours that [petitioning] counsel reasonably worked by the reasonable hourly rate for that work to determine the counsel?s lodestar, which may be multiplied by a factor intended to compensate the 41 Case: 18-2012 Document: 003113316560 Page: 51 Date Filed: 08/09/2019 attorneys for the risks they faced.? In re Cendant Corp. Sec. Litig., 404 F.3d 173, 188 (3rd Cir. 2005). This methodology requires a court to evaluate the lodestars of petitioning attorneys and then determine whether risk factors justify rewarding some attorneys with multipliers greater than those awarded to others in the litigation. A risk multiplier has two components. First, it must compensate counsel for the delay incurred between the time they perform professional services in the litigation and the time they are paid. Lindy Bros. Builders, Inc. of Phila. v. Am. Rad. Std. Sanitary Corp, 540 F.2d 102, 117 (3d Cir. 1976). Second, it must compensate counsel for the risk of receiving little or no payment when compensation for their services is contingent on uncertain success. Id. ?[T]he risk of success [is] ?perhaps the foremost? factor to be considered in determining whether to award an enhancement [to the lodestar].? Goldberger V. Integrated Resources, Inc., 209 F.3d 43, 54 (2d Cir. 2000) (citation omitted). Accord, Matter of Continental Illinois Sec. Litig, 962 F.2d 566, 569 (7th Cir. 1992) (court failed to provide compensation that ?re?ect[ed] the risky character of the[] undertaking?). Many courts have ruled that the risk of non-payment ?must be judged as it appeared to counsel at the outset of the case, when they committed their capital (human and otherwise)? In re NASDAQ Market-Makers Antitrust Litig, 187 F.R.D. 465, 488 (S.D.N.Y. 1998). Accord Hartman v. Lyphomed, Inc., 42 Case: 18-2012 Document: 003113316560 Page: 52 Date Filed: 08/09/2019 945 F.2d 969, 975?976 (7th Cir. 1991); Diet Drugs, 553 F. Supp. 2d at 478. This Court has not yet ?addressed whether courts must reconsider the risk of nonpayment as the action evolves.? Diet Drugs II, 582 F.3d at 543. Unlike a risk multiplier, a multiplier based on quality is ?appropriate only in rare cases.? Student Pub. Int. Research Grp. of New Jersey v. AT Bell Laboratories, 842 F.2d 1436, 1439 (3d Cir. 1988). That is because quality is typically re?ected in the lodestar: [C]ounse1 who possess or who are reputed to possess more experience, knowledge and legal talent generally command hourly rates superior to those who are less endowed. Thus, the quality of an attorney?s work in general is a component of the reasonable hourly rate; this aspect of ?quality? is re?ected in the ?lodestar? and should not be utilized to augment or diminish the basic award under the rubric of ?the quality of an attorney?s work?. Lindy, 540 F.2d at 117. This Court has found quality multipliers to be appropriate in four exceptional circumstances. First, quality multipliers may be appropriate for the ?complexity and novelty of the issues presented.? Fine Paper, 751 F.2d at 589. Typically, this evaluation is performed with reference to quantitative measures of litigation burden: the number of documents obtained and analyzed in discovery, the number of depositions taken and defended, the volume and dif?culty of motion practice, the competence and vigor of the attorneys opposing class counsel. See, e. g, Rite-Aid, 396 F.3d at 305 (discussing complexity factors). 43 Case: 18-2012 Document: 003113316560 Page: 53 Date Filed: 08/09/2019 Second, quality multiplier might well be appropriate, even for a modest result, if the court were to conclude that it had been achieved with unusual ef?ciency, and with little expenditure of attorney time and expense.? Fine Paper, 751 F.2d at 589. Third, a quality multiplier might be justi?ed for an ?extraordinary? result: In settled cases, the [quality] factor is re?ected largely in the bene?t produced. It permits the court to recognize and reward achievements of a particularly resourceful attorney Who secures a substantial bene?t for his clients with a minimum of time invested, or to reduce the objectively determined fee where the bene?t produced does not warrant awarding the full value of the time expended.? Lindy, 540 F.2d at 112 (citation omitted). Finally, a quality multiplier is warranted where the attorney at issue has performed ?exceptional services? and ?has discharged the professional burden undertaken with a degree of skill above . . . that expected for lawyers of the caliber re?ected in the hourly rates.? Id. at 118. Although the court purported to allocate the fee award using a lodestar methodology, it did not consider much less apply most of the factors this Court has required for determining appropriate multipliers. Instead, the court actually penalized ?rms with large numbers of clients, minimizing the value of the up-front work that made this MDL viable and holding that the ?great risk? required to mount a large number of lawsuits and present a credible threat to the NFL ?must be paid by [the] individuals? in those lawsuits, not taken into account in a risk 44 Case: 18-2012 Document: 003113316560 Page: 54 Date Filed: 08/09/2019 multiplier. JA8976. This is nonsense. The lodestar method begins by distinguishing between common-bene?t time and work that bene?ts only individual clients. By de?nition, a multiplier compensates ?rms for the risk of work that a court has already determined bene?ts the class as a whole. The court?s erroneous risk standard prejudiced LLF severely. The ?rm spearheaded the effort to mount a strong litigation threat against the NFL, ?ling four state class actions and more individual actions than any other ?rm. JA8069, A proper risk standard would not reward Mr. Seeger any more than other participating ?rms. If risk is determined at the outset of litigation, then every attorney entitled to common-bene?t fees was exposed to the same risk of non- compensation and is entitled to the same multiplier. If instead risk must be evaluated on an ongoing basis, this factor cuts against Mr. Seeger. Other leaders in this case performed substantial work prior to and immediately after the MDL transfer, before the NFL initiated settlement discussions. They interviewed hundreds of players, ?led individual and class lawsuits, and in the case of LLF took preservation depositions. JASO67, JA8069, They marshaled experts to articulate the trauma players endured, identi?ed the risk that claims would be preempted by the collective bargaining agreement, and hired a preeminent appellate lawyer to respond to the anticipated motion to dismiss. Mr. Seeger, in contrast, only started 45 Case: 18-2012 Document: 003113316560 Page: 55 Date Filed: 08/09/2019 performing substantial work after the NFL signaled its desire to settle and the risk of non?recovery was reduced. The court compounded this error by categorically refusing to include time expended before the MDL transfer when calculating petitioning attorneys? lodestars. This pre-lVIDL work created pressure for the NFL to settle early and clearly bene?tted the class. JA8069, Quality factors also cannot justify multiplying Mr. Seeger?s lodestar out of proportion to other ?rms. First, as to complexity, prior to the start of settlement negotiations, Mr. Seeger did not obtain or analyze any documents in discovery, did not conduct any depositions, did not brief any motions, retained no experts, and argued no appeals. Compare In re Cendant Corp. PRIDES Litig, 243 F.3d 722, 741 (3d Cir. 2001) (identifying ?factors which increase the complexity of class litigation? as ?complex and/or novel legal issues, extensive discovery, acrimonious litigation, and tens of thousands of hours spent on the case by class counsel?). Even after a settlement deal was struck with the substantial assistance of the court and the Executive Committee, Professor Issacharoff presented the argument to secure judicial approval of the Settlement and defend that result on appeal, not Mr. Seeger. Mr. Seeger?s outsized multiplier cannot be justi?ed on the basis of litigation complexity. 46 Case: 18-2012 Document: 003113316560 Page: 56 Date Filed: 08/09/2019 Second, considerations of ef?ciency do not support special enhancement of Mr. Seeger?s lodestar. Seeger Weiss submitted over 19,000 attorney hours in the allocation process (and many more since) in a case with no discovery and only one dispositive motion prior to settlement. JA6680. Mr. Seeger can hardly claim that he was undercompensated because the settlement was ?achieved with unusual ef?ciency, and with little expenditure of attorney time and expense.? Fine Paper, 751 F.2d at 589. Third, whether or not the result here can be characterized as ?extraordinary,? that outcome is the same for all ?rms whose common-bene?t work contributed to the result and is thus a neutral factor in allocating the fee award. Finally, there is no basis to conclude that services rendered by Mr. Seeger were performed with a degree of skill so exceptional as to justify a lodestar enhancement 2.8 times greater than and 1.4 to 4.67 times greater than other counsel. Many of the attorneys in leadership positions had substantial experience litigating and settling personal injury class actions. Mr. Locks, Mr. Weiss, Mr. Levin and Ms. Nast all served as Class or Sub-Class counsel in Diet Drugs, see Diet Drugs, 553 F. Supp. 2d at 449?450 nn. 4 7, the case that created the template for resolving personal injury class actions after the Supreme Court?s decision in Amchem Prods, Inc. v. Windsor, 521 US. 591 (1997). But when Mr. Seeger was put in charge of the negotiating effort, he agreed to a cap on player 47 Case: 18-2012 Document: 003113316560 Page: 57 Date Filed: 08/09/2019 recovery that led the court to reject the ?rst proposed settlement. JA1471. It was the court, not Mr. Seeger, that pressured the NFL to negotiate an uncapped fund, and the resulting Settlement was approved only after the court required further changes. NFL Concussion Injury I, 821 F.3d at 423. The record does not support a ?nding that Mr. Seeger demonstrated extraordinary skill entitling him to a greater multiplier than LLF and other Executive Committee members who made vital contributions to the settlement effort. The district court chose to employ a lodestar methodology to allocate common-bene?t fees but failed to perform the analysis this Court requires for lodestar-based awards. Instead, the court upended this Court?s standard for determining risk multipliers and awarded Mr. Seeger a quality multiplier that is not supported by substantial evidence. This was error, resulting in a bonanza for Seeger Weiss and under-compensation for LLF and other ?rms. II. THE FINDINGS AGAINST LLF ARE NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. A. The Lower Multiplier Applied to LLF is Clear Error. The district court and Mr. Seeger both identi?ed an interview that Mr. Locks gave to Businessweek for a feature story the magazine published on the litigation as a primary reason LLF received a low multiplier. See Paul M. Barrett, Will Brain Injury Doom the BLOOMBERG BUSINESSWEEK, Feb. 21, 2013, available at news/ article s/20 1 3 -01-3 1/ will?brain-iniurv-lawsuits- 48 Case: 18-2012 Document: 003113316560 Page: 58 Date Filed: 08/09/2019 doom-or?save-the-n?. The court?s ?nding on this issue is unsupported by substantial evidence. In his initial proposed allocation, Mr. Seeger made no mention of the Businessweek interview. Indeed, his statement about LLF in the proposal contained no explanation at all for the low multiplier he assigned the ?rm. On the settlement process, Mr. Seeger said only that made contributions toward the negotiation of the Settlement.? JA7952. Rather, LLF introduced the issue in its description of its work during the settlement negotiations when responding to Mr. Seeger?s proposal: To the consternation and anger, the undersigned was featured and interviewed for a Businessweek publication in Nov?Dec, 2012 [sic] which was published a few months after settlement negotiations began. That interview infuriated the NFL and spurred it to negotiate earnestly since it was plain to the NFL that the risk of not settling the matter was very high. This was, from the beginning, a very dangerous public-relations case for the NFL. It still is. When LLF and others exposed the NFL for denying the existence of insidious brain injury in football, the NFL risked losing its fan- base and revenue. It still does, and it has never faced an existential crisis of this magnitude. When Businessweek made clear to the public that the seriousness of this matter could well run into an uncapped liability to the NFL of multiple billions of dollars, the leverage of that publicity at the same time the Court ordered the parties to negotiate and work out a deal was substantial. The result was an uncapped settlement created in large measure by this Court, not Seeger, which proved that the statements in Businessweek were true. The result of the claims process, still not yet certain, may also prove these statements to be true. 49 Case: 18-2012 Document: 003113316560 Page: 59 Date Filed: 08/09/2019 Only then did Mr. Seeger seize on the interview as a reason for penalizing LLF, writing in his reply, ?It is important to note that, during con?dential settlement negotiations, Mr. Locks gave an interview to Businessweek, which jeopardized settlement negotiations and caused him to be removed from the negotiating team.? JA8257 n.23. At the allocation hearing, Mr. Seeger then offered this interview as his primary reason for penalizing LLF: As far as the reason for the lower multiplier, he did get a lower multiplier. There was a period of time when Mr. Locks during the negotiations, these are in our papers, Mr. Locks gave an -- when both sides had promised strict con?dentiality, Mr. Locks gave an interview at Business Week that caused the NFL to come back to us and terminate discussions. The only way that could move forward was if we eliminated Mr. Locks from the group, because they believed he would be a source of leaking information. I'm not agreeing with them at all. But I had to deal with that situation. JA9116. Notwithstanding the reference to the interview being ?in our papers,? the materials quoted above constitute the entirety of the record Mr. Seeger made on this issue: one sentence in his reply declaration, ?ve sentences at the hearing. Here is the entirety of the district court?s factual ?nding on the matter: also have to respect Co-Lead Class Counsel?s concerns about the impact of Mr. Locks? interview with Businessweek, since Co-Lead Class Counsel led the negotiations with the NFL and is best positioned to advise me on this matter.? The Businessweek story was never made a part of the record. There is no indication that the court read it. 50 Case: 18-2012 Document: 003113316560 Page: 60 Date Filed: 08/09/2019 On its face, this account is not credible. Mr. Locks sat for the interview with Businessweek in fall 2012, well before negotiations began with the NFL. JA8068. The story was published in February 2013, shortly after negotiations started. The interview disclosed no details of those negotiations (which had not even begun at the time), and Mr. Seeger offered no evidence that the story harmed the plaintiffs? negotiating position. To the contrary, Mr. Seeger said at the hearing that when the NFL demanded Mr. Locks be excluded from direct involvement with settlement talks ?because they believed he would be a source of leaking information? Mr. Seeger was ?not agreeing with them at all.? JA9116. LLF had no opportunity to question Mr. Seeger and interrogate his account. This record does not constitute substantial evidence that M. Locks? interview justi?es the penalty that Mr. Seeger and the court imposed. In a fee award based on lodestar analysis, the court ?has a positive and af?rmative function in the fee ?xing analysis, not merely a passive role.? Interfaith II, 726 F.3d at 416 (quotation omitted). When a court simply ?credit[s] [Appellees?] arguments as to the reasonableness of the legal . . . fees, expenses and hours charged? and says it ?will not second guess? those arguments, that ?perfunctory statement does not allow for meaningful appellate court review.? Id. at 417 (citation omitted). That is exactly what happened here. Mr. Seeger justi?ed lower multiplier with a conclusory statement at the fee hearing about a one-sentence post-hoe justi?cation 51 Case: 18-2012 Document: 003113316560 Page: 61 Date Filed: 08/09/2019 that was not contained in his initial allocation proposal, and the court simply deferred to him on the issue. This was plain error. Subsequent events in the record provide an obvious alternative explanation for these events that reinforces Mr. Locks? account of pressure applied to the NFL. After Mr. Locks was excluded from direct participation in settlement negotiations, Mr. Seeger agreed to cap the Monetary Award Fund for players at $675 million. Mr. Seeger presented that limit on recovery to the rest of the Executive Committee as a fair accompli, putting counsel and their clients to a Hobson?s choice: agree to a cap that threatened to leave many players without compensation, or abandon the settlement framework entirely. It took the intercession of the court to avoid this trap, reject the proposal as inadequate, and push the NFL to negotiate an uncapped fund. JAl47l. And the NFL did exactly that, agreeing to a fund with no limit on total payouts. A2121. Small wonder the NFL demanded Mr. Locks? removal from the negotiating team when the Businessweek story was published: his interview created public pressure for a larger fund see Barrett, Will Brain Injury Doom the at 4, 10?11 at a time when Mr. Seeger was agreeing to an inadequate cap on the liability. B. The Court Created No Record and Issued No Speci?c Ruling on Objections to Exclusion of Time from its Lodestar. LLF and other ?rms also made speci?c objections to Mr. Seeger?s unilateral adjustments to their lodestar on which the court made no record and no speci?c 52 Case: 18-2012 Document: 003113316560 Page: 62 Date Filed: 08/09/2019 ruling. For example, early in the litigation LLF spent many paralegal hours creating a Retired Player Database to strengthen the case for the liability exposure. In his petition seeking the award of total fees, Mr. Seeger emphasized this database as ?vitally important to the entire negotiation process because it enabled Plaintiffs? Counsel to appropriately characterize disease and occurrence? and ?served as a useful cross-check? on epidemiological data. When LLF sought to include this ?vitally important? work in its lodestar, Seeger Weiss re?lsed, saying paralegal time would not be reimbursed. But Mr. Seeger went on to include $382,804 in paralegal time in his lodestar. JA6680. When increased by his 3.5 multiplier, this meant over $1.3 million in compensation for Mr. Seeger. Mr. Levin also received compensation for paralegal time. JA6723-11. LLF raised this issue at the hearing. Mr. Seeger responded as follows: ?When you?re talking about a database, our view was that many of that [sic] was JA9115. The same database that Mr. Seeger trumpeted to the court as ?vitally important to the entire [settlement] negotiation process? when he was petitioning for the award of common-bene?t fees, JA6650, he dismissed as unworthy of compensation when allocating those fees between himself and other ?rms. The statement quoted above is the entirety of the record Mr. Seeger made on the matter. The court issued no ?nding of fact. 53 Case: 18-2012 Document: 003113316560 Page: 63 Date Filed: 08/09/2019 attorney hours also included substantial time communicating with clients about the Settlement. That time served a vital ?lnction. The Settlement involves trade-offs, and players required expert assistance when deciding whether to participate. In the end, only a tiny handful of clients opted out, preserving the Settlement?s Viability. Nonetheless, Mr. Seeger disallowed much of that time. LLF had the largest number of clients of any ?rm, so it suffered the most from Mr. Seeger?s skewed incentive on the treatment of client-contact time. Because Mr. Seeger made these decisions unilaterally, there is no record of the exclusions on the docket. Again, the court issued no ?nding of fact. In a fee award based on lodestar values, where ?an objecting party has challenged speci?c types of work and states why it is contended that the hours claimed are excessive? or here, improperly excluded ?the reviewing court must support its ?ndings with a suf?cient articulation of its rationale to allow for meaningful appellate review.? Interfaith II, 726 F.3d at 416. If instead ?the opinion of the District Court is so terse, vague, or conclusory that [there is] no basis to review it, [the Court] must vacate the fee-award order and remand for further proceedings.? Id. at 417 (quotation omitted). The court below created no record on myriad objections to the exclusion of billed hours from the lodestars of LLF and other ?rms. Instead, it deferred to Mr. Seeger?s decisions. The resulting allocation is unsupported by substantial evidence and must be vacated. 54 Case: 18-2012 Document: 003113316560 Page: 64 Date Filed: 08/09/2019 CONCLUSION The district court empowered Mr. Seeger uniquely among all the experienced ?rms that ?led suit on behalf of former players in this proceeding. The court had contact only with Mr. Seeger, placed him in control of settlement negotiations with the NFL, and made him the gatekeeper for all ?lings and petitions on behalf of the class. Using that authority, Mr. Seeger assigned the lion?s share of common-bene?t work to himself. When a court empowers one attorney as its sole agent and grants him authority over other ?rms that contribute common-bene?t work in an MDL, that decision imposes additional responsibilities. The court must ensure its agent employs even-handed procedures, and it must exercise meaning?il supervision to ensure that its agent does not exploit his position. The district court failed to satisfy those responsibilities in the allocation of common-bene?t fees, enabling Mr. Seeger to sacri?ce transparency for one-sided control of information and abandon negotiation for self-enrichment. It then blessed the results without adequate independent scrutiny. The resulting award offends the ?basic principles of fairness? that this Court has demanded in fee allocations. Diet Drugs II, 582 F.3d at 547. Appellants respectfully request that this Court vacate the district court?s order allocating common?bene?t fees and remand with instructions that the court 55 Case: 18-2012 Document: 003113316560 Page: 65 Date Filed: 08/09/2019 and the parties craft a process for a new allocation that will accord with due process and satisfy the values of transparency, reliability and basic fairness. Dated: August 9, 2019 Respectfully submitted, Tobias Barrington Wol?? Tobias Barrington Wolff 3501 Sansom Street Philadelphia, PA 19104 (215) 898-7471 Counsel for Locks Law Firm Gene Locks Michael Leh LOCKS LAW FIRM The Curtis Center 601 Walnut Street Suite 720 East Philadelphia, PA 19106 (866) 562?5752 56 Case: 18-2012 Document: 003113316560 Page: 66 Date Filed: 08/09/2019 CERTIFICATE OF BAR MEMBERSHIP Pursuant to Local Appellate Rule I hereby certify that I was admitted to the Bar of the US. Court of Appeals for the Third Circuit on September 25, 2018 and remain a member in good standing. Dated: August 9, 2019 Tobias Barrington Wolff Tobias Barrington Wolff Counsel for Locks Law Firm 57 Case: 18-2012 Document: 003113316560 Page: 67 Date Filed: 08/09/2019 CERTIFICATE OF COMPLIANCE Undersigned counsel certi?es that this brief complies with the type-volume limitation of Federal Rule of Appellate Procedure and this Court?s June 11, 2019 brie?ng and scheduling order as it contains 12,999 words, excluding the parts of the brief exempted by Federal Rule of Appellate Procedure 32(f). Undersigned counsel also certi?es that this brief complies with the typeface requirements of Federal Rule of Appellate Procedure 32(a)(5) and the type style requirements of Federal Rule of Appellate Procedure This brief has been prepared in a proportionately spaced 14-point Times New Roman typeface using Microsoft Word 2011. Undersigned counsel further certi?es pursuant to Local Appellate Rule 31.0(c) that the text of the electronic version of this brief is identical to the text of the paper copies, and a Virus check was performed on the .pdf ?le of this brief using McAfee VirusScan version 8.8 and no Virus was detected. Dated: August 9, 2019 Tobias Barrington Wolff Tobias Barrington Wolff Counsel for Locks Law irm 58 Case: 18-2012 Document: 003113316560 Page: 68 Date Filed: 08/09/2019 AFFIDAVIT OF SERVICE IN THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT Case Nos. 18-2012, 18-2225, 18-2249, 18-2253, 18-2281, 18-2332, 18-2416, 18-2417, 18-2418, 18-2419, 18-2422, 18-2650, 18-2651, 18-2661, and 18-2724 In re National Football League Players? Concussion Injury Litigation COUNTY OF PHILADELPHIA 1, Frederick W. Wright, being duly sworn according to law and being over the age of 18, upon my oath depose and say that: I am retained by Tobias Barrington Wolff, Esq., Attorney for Appellant, Locks Law Firm, that on this 9th day of August 2019, the Brief and Appendix Volumes have been served by ECF . Filing to the Court has been perfected on the same date as above. /s/Frederick W. Wright FREDERICK W. WRIGHT Wright Appellate Services 5 17 Jefferson Building 1015 Chestnut Street Philadelphia, PA 19107 (215) (215) 733-9872 Email address: