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The Times-Picayune: Fee order in gas gauge case tossed

Date Published: February 7, 2008
The Associated Press

A federal appeals court has thrown out an order giving $6.8 million in fees to plaintiff attorneys who handled a lawsuit over tainted gasoline that damaged fuel gauges.

Three members of the 5th U.S. Circuit Court of Appeals said that U.S. District Judge Ivan Lemelle had decided how much each of the six dozen attorneys would receive by using an “improper and unauthorized” process.

That included meeting privately with the five lawyers the judge named to a committee to recommend fees. Lemelle then accepted the committee’s recommendations and sealed records on how much each attorney received.

The committee ultimately steered nearly half the $6.8 million fee pool to their own firms, according to records Lemelle released last June after an appeal from Loyola Law School ethics professor Dane Ciolino.

Ciolino, who acted on behalf of two lawyers who said they had been shortchanged, praised the 5th Circuit’s decision.

“This opinion will go a long way to restoring normality to attorneys’ fees in class action cases,” Ciolino said. “It will move fee allocations from smoke-filled back rooms to public courtrooms where they obviously belong.”

The 5th Circuit vacated what it called Lemelle’s “rubber-stamping” of the fee committee’s suggestions. The court ordered him to “make an adequate record” to test those recommendations and hear from any attorney who objects to a proposed fee.

Asked for comment, Lemelle said he does not comment on pending litigation.

The fee controversy stems from a federal lawsuit brought on behalf of Louisiana, Mississippi, Alabama and Florida residents whose fuel gauges broke after they bought Shell Oil Co. gasoline containing too much sulfur during 2004. The gasoline was refined in Norco.

When motorists began complaining, Shell volunteered to fix broken gauges in tens of thousands of vehicles at a cost of $200 to $1,000 each, depending on the car model.

Information from: The Times-Picayune

http://www.timespicayune.com

http://www.theitem.com/apps/pbcs.dll/article?AID=/20080207/APN/802070678

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