In Re Media Vision Technology Securities Litigation

913 F. Supp. 1362, 1996 U.S. Dist. LEXIS 4784, 1996 WL 44748
CourtDistrict Court, N.D. California
DecidedJanuary 23, 1996
DocketMaster C-94-1015 EFL
StatusPublished
Cited by45 cases

This text of 913 F. Supp. 1362 (In Re Media Vision Technology Securities Litigation) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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In Re Media Vision Technology Securities Litigation, 913 F. Supp. 1362, 1996 U.S. Dist. LEXIS 4784, 1996 WL 44748 (N.D. Cal. 1996).

Opinion

ORDER

LYNCH, District Judge.

This Court referred to Chief Magistrate Judge Langford the application of plaintiffs’ counsel for costs and expenses incurred in the partial settlement of this action. After conducting a hearing and requesting and receiving additional documentation, Chief Magistrate Judge Langford issued his Findings and Recommendations on December 15, 1995. No party has objected.

The Court has reviewed the Findings and Recommendations, and agrees with the general guidelines set forth therein regarding which expenses should be awarded, which should be discounted, and which should be denied. The matter is therefore REFERRED to Chief Magistrate Judge Lang-ford for calculation of the amounts to be awarded following those guidelines. Chief Magistrate Judge Langford is requested to issue Findings and Recommendations detailing the amounts to be awarded to each of the law firms seeking reimbursement. •

Furthermore, the Court shares Magistrate Judge Langford’s great concern about the excessive costs sought as reimbursement, particularly "with respect to travel, meals, and accommodations. Counsel should be guided by an awareness of these concerns in seeking any future award of costs, and should be aware that the Court will not award reimbursement for excessive expenditures.

*1365 Finally, in keeping with Chief Magistrate Judge Langford’s recommendation, plaintiffs’ counsel are ordered to submit all future applications for costs and expenses in a detailed format, breaking down the amount requested and outlining the necessity of each expense. Counsel are further ordered that to the extent that counsel anticipate seeking reimbursement for extensive travel or extensive use of nonlegal experts, they should inform the Court prior to incurring those expenses. As the Court has previously ordered, plaintiffs’ counsel may submit information about their unusual expenditures ex parte and under seal, and the Court will determine whether the information should remain under seal.

IT IS SO ORDERED.

FINDINGS AND RECOMMENDATIONS

LANGFORD, Chief United States Magistrate Judge.

Plaintiffs’ counsel’s application for costs and expenses was referred to this Court for findings and recommendations by order of the District Court (Hon. Eugene F. Lynch), Plaintiffs’ counsel filed this application for costs and expenses incurred to date and for reservation of partial settlement proceeds for costs and expenses to be incurred in the future in connection with plaintiffs’ claims against non-settling defendants 1 , dated June 29, 1995. The application is based on plaintiffs’ counsel’s Notice, Memorandum of Points and Authorities and Declarations of plaintiffs’ attorneys. Plaintiffs’ counsel’s argument having been fully considered and for good cause appearing, this Court makes the following findings and recommendations:

BACKGROUND

On or about March 24, 1994, eighteen actions have been filed in the United States District Court for the Northern District of California as class actions on behalf of persons who purchased Media Vision common stock and debentures during a defined period of time. The actions were consolidated as In re Media Vision Technology Securities Litigation, Master by Stipulation and Order filed May 17,1994 (the “Class Action”).

The Operative complaint in this Litigation is the Second Amended Consolidated Complaint, filed on March 8, 1995 (“Complaint”). The Complaint asserts violations of Section 11,12(2), and 15 of the Securities Act of Í933, Section 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder.

On November 10, 1994, plaintiffs filed a motion for class certification. On November 29, 1994, the court approved a Stipulation and Order. Plaintiffs have designated five persons to serve as class representatives.

A Stipulation of Settlement was entered into on September 22, 1995 (the “Stipulation”). The Stipulation was intended by the Settling Parties to fully resolve, discharge, and settle the Released Claim. The Settlement between the Settlement Class and the Settling Defendants and Media Vision’s outside directors, the Settling Outside Directors, has created a Settlement Fund of $1 million for the benefit of the Settlement Class.

.Plaintiffs’ counsel, comprised of at least fifty groups of plaintiffs’ attorneys, have filed this application for reimbursement of costs and expenses to date, of approximately $797,-161.89. Plaintiffs’ counsel further request that the balance of the Fund be used as a “war chest” to fund the prosecution of the case against the non-settling defendants.

APPLICABLE LAW

“[T]he foundation for the historic practice of granting reimbursement for the costs of litigation is part of the original authority of the chancellor to do equity in a particular situation.” Mills v. Electric Auto-Lite Co., 396 U.S. 375, 392-3, 90 S.Ct. 616, 626, 24 L.Ed.2d 593 (1970) (citing Sprague v. Ticonic Nat. Bank, 307 U.S. 161, 166, 59 S.Ct. 777, 780, 83 L.Ed. 1184 (1939)).

The reimbursement of taxable expenses in federal litigation is governed by 28 *1366 U.S.C. § 1920 2 and Fed.R.Civ.P. 54 3 . However, unlike the Fed.R.Civ.P. 54(d), which entitles prevailing parties to collect taxable costs, an attorney who has created a common fund has a right to reimbursement even if the litigation does not produce, or may never produce, an actual recovery. Id. at 392, 90 S.Ct. at 626. Reasonable costs and expenses incurred by an attorney who creates or preserves a common fund are reimbursed proportionately by those class members who benefit by the settlement. See Herbert B. Newberg, Attorney Fee Awards (1986) § 2.19: “Costs Reimbursement in Common Fund Fee Determinations,” at 69; Mills v. Electric Auto-Lite Co., 396 U.S. 375, 391-92, 90 S.Ct. 616, 625-26, 24 L.Ed.2d 593 (1970).

However, the costs and expenses incurred by counsel are subject to a test of relevance and reasonableness in amount. The taxation of costs lies within the trial court’s discretion. Thornberry v. Delta Air Lines, 676 F.2d 1240, 1245 (9th Cir.1982), remanded on other grounds, 461 U.S. 952, 103 S.Ct. 2421, 77 L.Ed.2d 1311 (1983). The judge must look at the practical and reasonable needs of the party in the context of the litigation.

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913 F. Supp. 1362, 1996 U.S. Dist. LEXIS 4784, 1996 WL 44748, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-media-vision-technology-securities-litigation-cand-1996.