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Attorneys – Fees – Corporate Merger – Supplemental Disclosures – Reduced Award

The claims in this challenge to a corporate merger could have been adequately and effectively prosecuted by North Carolina counsel experienced in complex litigation of this type. The materiality of the supplemental disclosures made as a result of this lawsuit is apparent but not so obvious as to justify an award at the highest end of the range of fees for the services of highly qualified North Carolina counsel ($250 to $550 per hour); therefore, the court awards plaintiff’s counsel fees at an implied rate of $400 per hour.

Plaintiff’s counsel is awarded fees of $140,000. However, counsel’s motion for expenses is denied.

To the extent that North Carolina Court of Appeals’ decisions are in conflict regarding whether a trial court may judicially notice a range of prevailing hourly rates, the court follows the line of cases that allow judicial notice of local prevailing rates.

Although that the fee agreement between plaintiff and plaintiff’s counsel may have violated N.C. R. Prof. Cond. 1.5(c)’s requirement to state a percentage of recovery to accrue to plaintiff’s counsel in the event of a monetary fund, any such RPC 1.5(c) violation concerns the form, not content, of the RPC and does not justify a forfeiture of fees.

However, the fee agreement violates RPC 1.8(e)’s requirement that repayment of advanced costs be contingent upon a matter because the agreement absolves plaintiff of all financial responsibility at the outset of litigation, and this violation offends the public policy on which the rule is based. Accordingly, plaintiff’s counsel is barred from recovering its litigation expenses.

Moss v. Towell (Lawyers Weekly No. 020-042-18, 15 pp.) (James Gale, S.J.) Seth Rigrodsky, Brian Long, Jeremy Riley and Gary Jackson for plaintiff; Roy Arnold, Robert Marcus, Paul Lockwood, Joseph Larkin, Alyssa O’Connell and Mark Nebrig for defendants. 2018 NCBC 65


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