Shareholder Primacy Prof. Joe Grundfest and attorney Joel Fleming on Delaware contingency fees
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Jun 18, 2025 Prof. Joe Grundfest, a legal expert from Stanford, teams up with Joel Fleming, a seasoned attorney specializing in Delaware litigation. They dive into the complexities of contingency fees in Delaware, exploring why these fees are significantly higher than in federal courts. The discussion highlights the implications of proposed legislative changes and scrutinizes the balance of attorney compensation versus client interests. They also emphasize the unique dynamics of Delaware’s legal system, which leads to more trials and offers insight into high-profile litigations like Enron.
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Attorney Fee Challenges in Class Actions
- In representative litigation, plaintiff attorneys represent large groups but deal only with nominal plaintiffs. - This structure risks attorneys prioritizing maximizing fees over representing the class effectively.
Delaware's High Fee Multiplier
- A multiplier over lodestar measures fee awards relative to attorneys' usual billing rates. - Delaware awarded a rare 66x multiplier in America's Mining, the highest found anywhere in U.S. courts.
Delaware Courts Award Larger Fees
- Multipliers of 7x and 10x are far more common in Delaware than in federal court. - Delaware also sees more extreme outlier fee awards than federal courts.