Judge Rules Plaintiffs Lawyers Can’t Charge 9/11 Clients $6.1M in Interest
A federal judge in New York City is refusing to allow plaintiffs lawyers to collect $6.1 million in interest from ground zero clients to pay the interest on money borrowed to finance the litigation.
U.S. District Judge Alvin Hellerstein said the lawyers could make $150 million in fees in the case, and they are getting “too much,” according to stories in the New York Law Journal, the Associated Press and the New York Times. “In the context of $150 million, I believe you can absorb $6 million,” Hellerstein said.
A partnership of two plaintiffs firms—Worby Groner Edelman and Napoli Bern Ripka—represents most of the workers alleging illness because of their ground zero work. The plaintiffs lawyers had borrowed tens of millions of dollars to finance the litigation and their clients had signed an agreement to pay the interest, AP says.
Lead plaintiffs lawyer Paul Napoli presented testimony on Friday from two law professors supporting the arrangement. According to the New York Law Journal, he “marshaled opinions by bar associations, court cases and experts to show that borrowing to finance litigation and passing the cost to clients is both legal and ethical.”
One of the plaintiffs lawyers, William Groner, complained after the hearing that that the judge had ruled against them “for no other reason than it’s 9/11,” according to the AP account.
In a June hearing, Hellerstein capped contingency fees for the law firm at 20 percent. So far, more than 50 percent of the plaintiffs have opted into the proposed settlement in the case, the New York Law Journal says. Ninety-five percent must agree to participate by Nov. 8 for the agreement to take effect.
Prior coverage:
ABAJournal.com: “Lawyers for 9/11 Workers Ordered to Justify Charging Clients $6.1M for Loan Interest”
