The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge:
MEMORANDUM OPINION AND ORDER
Plaintiffs have filed a motion for an award of attorney's fees and expenses and reimbursement of the class representatives' expenses pursuant to 15 U.S.C. § 78u-4(a)(4).For the reasons explained below, the Court grants in part and denies in part Plaintiffs' motion.In the present order, the Court assumes familiarity with the underlying facts of the case, which are set forth in detail in the Court's summary judgment order.See Silverman v. Motorola, Inc., 798 F. Supp. 2d 954 (N.D. Ill. 2011).
"In a certified class action, the court may award reasonable attorney's fees . . . that are authorized by law or by the parties' agreement." Fed. R. Civ. P. 23(h). In determining a reasonable fee, the Court "must balance the competing goals of fairly compensating attorneys for their services rendered on behalf of the class and of protecting the interests of the class members in the fund." Skelton v. Gen. Motors Corp., 860 F.2d 250, 258 (7th Cir. 1988), cert. denied, 493 U.S. 810, 110 S. Ct. 53, 107 L. Ed. 2d 22 (1989). To determine the reasonableness of the sought-after fee in a common-fund case, "courts must do their best to award counsel the market price for legal services, in light of the risk of nonpayment and the normal rate of compensation in the market at the time." In re Synthroid Mktg. Litig., 264 F.3d 712, 718 (7th Cir. 2001). The probability of success at the outset of the litigation is relevant to this inquiry. See Florin v. Nationsbank of Ga., N.A., 34 F.3d 560, 565 (7th Cir. 1994).
In Synthroid, the Seventh Circuit held that the "market rate for legal fees depends in part on the risk of nonpayment a firm agrees to bear, in part on the quality of its performance, in part on the amount of work necessary to resolve the litigation, and in part on the stakes of the case." Synthroid, 264 F.3d at 721. The Seventh Circuit has further explained that "[t]he object in awarding a reasonable attorney's fee . . . is to give the lawyer what he would have gotten in the way of a fee in arm's length negotiation, had one been feasible." In re Cont'l Ill. Sec. Litig., 962 F.2d 566, 572 (7th Cir. 1992). See also In re Trans Union Corp. Privacy Litig., 629 F.3d 741, 744 (7th Cir. 2011) (recognizing that "[s]uch [an] estimation is inherently conjectural").
The Federal Rules of Civil Procedure allow the Court, in a certified class action, to "award reasonable . . . nontaxable costs that are authorized by law or by the parties' agreement." Fed. R. Civ. P. 23(h). The Seventh Circuit has explained that district courts must exercise their discretion to "disallow particular expenses that are unreasonable whether because excessive in amount or because they should not have been incurred at all." Zabkowicz v. W. Bend Co., Div. of Dart Indus., Inc., 789 F.2d 540, 553 (7th Cir. 1986) (quoting Henry v. Webermeier, 738 F.2d 188, 192 (7th Cir. 1984)).
The proposed settlement in this case is $200 million (the "Settlement Amount"), which Plaintiffs represent is the third-largest securities class action settlement in the Seventh Circuit.
(R. 455, Mem. of Law at 1.) Class Counsel seek an attorney's fee award of 27.5% of the Settlement Amount, litigation costs of $4,814,298.54, and reimbursement of the litigation expenses incurred by the class representatives, Macomb County Employees' Retirement System ("Macomb County") and St. Clair Shores Police & Fire Retirement System ("St. Clair"), in the amount of $6,450.00 and $4,350.00, respectively. (Id.)
On March 19, 2012, Plaintiffs filed their motion for final approval of the settlement, the plan of allocation, and class counsel's fee and expense request. (R. 454, Mot.) Class members had until April 2, 2012 to object. Only one class member, Mr. Edward Falkner ("Mr. Falkner"), timely objected to the attorney fee request.*fn1 He sets forth two arguments, both of which the Court rejects.
First, Mr. Falkner argues that Class Counsel did not give reasonable notice of the fee motion to class members. (R. 463, Falkner Obj. at 1.) Pursuant to the Court's Order, Class Counsel, through a third party claims administrator, sent a Notice of Proposed Settlement of Class Action (the "Notice") to class members on February 27, 2012 and also published the Notice with the Depository Trust Corporation's Legal Notice System. (R. 462, Sylvester Decl. ¶¶ 4-7.) The Notice stated that "[i]f the settlement is approved by the Court, Plaintiffs' counsel will apply to the Court for attorneys' fees of 27.5% of the Settlement Fund and expenses not to exceed $4,950,000, plus interest thereon, to be paid from the Settlement Fund . . . . In addition, each of the two Plaintiffs may seek up to $7,500 in expenses incurred in representing the Class."
(R. 462-1, Notice § IV.) The Notice further provided that the deadline for objections to the motion for attorney's fees and expenses was April 2, 2012. (Id. § XVIII.) Finally, the Notice provided that class members could examine the papers on the Court's docket "for a more detailed statement of the matters involved in the Litigation," and could contact Class Counsel if they had questions about the settlement. (Id. § XX.) Moreover, the Court's Order Preliminarily Approving Settlement and Providing for Notice, which was available on the Claims Administrator's website, stated that Class Counsel's request for attorney's fees was due by March 19, 2012 and that objections were due on April 2, 2012. (R. 450, Order at ¶¶ 2, 10, 12; R. 462, Slyvester Decl. ¶ 12.)
Mr. Falkner nevertheless contends that notice was inadequate under Federal Rule of Civil Procedure 23(h) because Class Counsel did not provide reasonable service of the actual motion for attorney's fees to the class. (R. 463, Falkner Obj. at 1, relying on In re Mercury Interactive Corp. Sec. Litig., 618 F.3d 988, 993-94 (9th Cir. 2010).) Mercury Interactive is inapposite, however, because the issue in that case was whether the "district court erred in setting the objection deadline for class members on a date before the deadline for lead counsel to file their fee motion." Id. at 993. Unlike in Mercury Interactive, class members in this case were provided with an "adequate opportunity to object to the motion itself," which was filed two weeks before the objection deadline. Id. at 994. Indeed, ...