Full opinion text
MEMORANDUM AND ORDER O’MALLEY, District Judge. With this Order, the Court enters Attorney Fee Awards to certain attorneys in connection with their efforts to confer a Common Benefit to the Plaintiff Class in this Multi-District Litigation Class Action Settlement. The specific Fee Awards for each attorney are listed in the chart at the end of this Order. As explained further below, the parties and the Court reserved a maximum of $50 million, out of a total settlement of over $1 billion, for the payment of Common Benefit Attorney Fee Awards. The total of the Fee Awards authorized by this Order is $30,232,300.00. In addition, the Court estimates it may authorize additional Fee Awards to certain attorneys in the amount of about $12,650,000.00, but the Court is withholding the entry of those awards at this time. Assuming the Court’s estimate of additional Fee Awards is accurate, this leaves a remainder of $7,117,700.00 (out of the $50 million reserve). The Court DIRECTS the Claims Administrator and the Trustee of the Sulzer Settlement Trust to continue to hold in reserve this entire $7,117,700.00 amount for payment of certain costs associated with effectuating the settlement and, if possible, distribution to the settlement class. With regard to the specific, individual Fee Awards authorized by this Order, the Court further DIRECTS as follows. First, the Claims Administrator and the Trustee of the Sulzer Settlement Trust shall promptly COMPLY with sections 5.4 and 5.6 of the Settlement Agreement, which directs that these Fee Awards “shall be paid to liaison Class Counsel, who shall distribute such amounts to [the appropriate] Common Benefit Attorneys,” and states that the Fee Awards “shall be paid out of the [proceeds from the] CCI.” Second, if an individual attorney desires an explanation of how the Court applied the relevant factors to reach its conclusion regarding his own common benefit fee award, the attorney must file a formal request therefor within ten calendar days of the date of this Order. The Court will then issue a brief written explanation, which will become an appendix to this Order. The Court will provide a personal explanation only if requested by the attorney who actually submitted the common benefit Fee Application (or his law firm). Except as noted in footnote 1 above, and pursuant to Fed.R.Civ.P. 58, this Order entering Fee Awards is a final appealable Order. I. Background. A. The Defective Products. Sulzer Orthopedics, Inc. (“Sulzer Orthopedics”) is a Texas-based designer, manufacturer, and distributor of orthopedic implants for hips, knees, shoulders, and elbows. During the relevant time-frame, Sulzer Orthopedics was wholly owned by Sulzer Medica USA Holding Company (“Sulzer Medica USA”), and Sulzer Medica USA was wholly owned by Sulzer Medica Ltd. (“Sulzer Medica”), a Swiss company. Sulzer AG, another Swiss company, owned 74% of Sulzer Medica. One of the products manufactured by Sulzer Orthopedics is known as the “Inter-Op acetabular shell,” : mh is one component of a system used for complete hip replacements. Specifically, the Inter-Op shell is a socket-like device inserted into the acetabulum, which is a part of the pelvis; the shell is designed to receive a separate, ball-like device, which is inserted into the femur, or thigh bone. The two components thereby replace the articulating ball-and-socket structure of the hip joint. The Inter-Op shell is regulated by the federal Food and Drug Administration (“FDA”). Proper surgical attachment of these replacement components in the body is critical. Orthopedic implants are often cemented or screwed into position. Some implants are also designed to allow the bone to grow into and around them, holding them securely in place. The Inter-Op acetabular shell was designed to bond with the natural bone. Unfortunately, a manufacturing defect apparently prevented some of Sulzer Orthopedics’ Inter-Op shells from bonding with the acetabulum. In early December of 2000, Sulzer Orthopedics announced a voluntary recall of certain manufacturing lots of its Inter-Op shells. Most of the recalled products were manufactured during or after October of 1999, but a limited number were produced as early as June of 1997. The recall stated that Sulzer Orthopedics had “received reports of post-operative loosening” of some of the Inter-Op shells, apparently “related to a reaction of the [human] body to a slight residue of lubricant used in the manufacturing process.” Sulzer Orthopedics recalled approximately 40,000 units of its Inter-Op shell, of which about 26,000 had already been implanted in patients. About 90% of these implants occurred in the United States. With regard to the recalled units, Sulzer Orthopedics “reprocessed” some of them — that is, “re-cleaned” about 16,500 of the never-implanted, recalled shells — and then resold them. About 6,100 of these reprocessed units were implanted. One of the documents issued by Sulzer Orthopedics in connection with the voluntary recall included the following explanation: Sulzer Orthopedics is the manufacturer of a hip implant that you received during hip replacement surgery. We sincerely regret to inform you that we have recently learned that a small number of the many implant parts that we manufactured may have a trace of lubricant residue on the surface that was not completely removed during the manufacturing process. % iH % # ‡ % The hip implant part is the acetabular “shell” which was implanted into the upper part of your hip called the aceta-bulum. Normally, the bone would form an integrated bond with the shell; however, it appears that bone does not always bond with shells when the lubricant residue is present. Reported symptoms include severe groin pain and inability to bear weight on your leg. These symptoms are caused by the shell being loose from the bone. Only a small number of patients who received the shell during their total hip replacement have experienced loosening of the shell. In fact, to date, over 3,800 of the patients who received implants of the defective Inter-Op shells have undergone “revision surgery” — removal of the defective implant and replacement with a new one. For a variety of reasons, not all of the patients who were implanted with recalled Inter-Op shells will undergo revision surgery. For example, some patients will not experience any bone-bonding failure; other patients may suffer severe failure but be medically ineligible for revision surgery. The best evidence, however, shows that, as of today, all of those medically eligible patients needing revision surgery to replace defective Inter-Op acetabular shells have already undergone it. After Sulzer Orthopedics discovered the problem with the Inter-Op shells, the company reviewed its manufacturing processes for its other medical implant products. This review led Sulzer Orthopedics to discover that it had used a similar manufacturing process during its fabrication of an implant product known as the Natural Knee II Tibial Baseplate. Just as it did with the Inter-Op shell hip implants, Sul-zer Orthopedics voluntarily notified the public that a problem existed with certain Natural Knee tibial baseplates. Specifically, on May 17, 2001 — about five months after it had announced the voluntary recall of the Inter-Op shells — Sulzer Orthopedics sent a “Special Notification Letter” to surgeons who had implanted certain identified “Natural Knee II Porous-Coated Stemmed Tibial Baseplates.” The purpose of this Notification was to make the surgeons aware of “unanticipated adverse clinical outcomes” associated with these baseplates — specifically, “aseptic loosen-ings,” similar in nature to what had occurred with the Inter-Op acetabular shell hip implants. In addition to issuing this Notification, Sulzer Orthopedics also asked its distributors and sales agents to return any Natural Knee baseplates manufactured from July 2000 to December 2000 that had not already been implanted. Sul-zer did not “reprocess” any Natural Knee baseplates. The manufacturing defect occurred during production of about 1,600 Natural Knee baseplates, about 1,300 of which were implanted in patients. As of today, over 580 revision surgeries for the Natural Knee baseplate implants have occurred. As with the Inter-Op shells, Sul-zer Orthopedics now estimates that virtually all of those medically eligible patients who will need revision surgery to replace the defective Natural Knee baseplates have already undergone it. B. The Multi-District Litigation. Shortly after Sulzer Orthopedics issued its voluntary recall of its Inter-Op shells in December of 2000, a number of plaintiffs around the country filed lawsuits, in both state and federal courts. By August 31, 2001, there were pending about 1,300 civil suits nationwide, about 200 of which were in federal court. These cases involved about 2,000 named plaintiffs, primarily including implant recipients and their spouses. Over 90% of the state court actions were filed in California, Texas, Florida, or New York. About 19 of the state court cases were styled as class actions, as were about 34 of the federal court cases. The defendants named in these lawsuits included not only Sulzer Orthopedics, but also: (1) Sulzer Medica USA; (2) Sulzer Medica; (3) Sulzer AG; (4) various other Sulzer-related entities; and (5) various surgeons, hospitals, and medical supply companies connected to the distribution or implantation of the defective product. The causes of action in these lawsuits included claims for defective design, marketing, and manufacture; breach of express and implied warranties; negligence; strict liability; and other legal theories of recovery. On August 30, 2001, the first of these cases to go to trial ended with a substantial plaintiffs’ verdict. Similarly, shortly after Sulzer Orthopedics issued the voluntary recall of its Natural Knee II implants, patients who had received these implants also filed lawsuits around the country, in both state and federal court. Specifically, as of October 19, 2001, plaintiffs had filed claims related to-defective knee implants in 27 state court actions and 5 federal actions; three of these 32 lawsuits were putative class actions. These cases involved the same defendants and the same legal theories as the eases involving the Inter-Op shells. In early 2001, pursuant to 28 U.S.C. § 1407, three different federal plaintiffs with Inter-Op shell hip implants filed motions with the Federal Judicial Panel on Multi-District Litigation (“MDL Panel”), seeking to consolidate and centralize 30 of the federal lawsuits. MDL docket no. 1401. On June 19, 2001, the MDL Panel granted these motions, consolidating and transferring all related pending federal litigation to the Northern District of Ohio and assigning oversight of the MDL proceedings to the undersigned. Initially, the consolidated litigation involved only cases related to the Inter-Op shells. On September 5, 2001, however, the MDL Panel transferred to this Court a case involving a Natural Knee tibial baseplate implant, because it involved questions of fact similar to those in the Inter-Op shell cases. Eventually, virtually all of the federal cases involving the Inter-Op shells and Natural Knee baseplates were transferred to this Court. C. The Initial Class Settlement. On July 7, 2001, the Court issued an Order setting out the “practices and procedures” it would follow during its administration of the MDL proceedings. See docket no. 3. Among other things, this Order: (1) temporarily appointed liaison and co-lead counsel for plaintiffs; (2) set an initial case management conference for August 17, 2001; and (B) directed counsel to submit an agenda for this conference, to include a discovery plan and also proposed deadlines for amendment of pleadings, expert and non-expert discovery, dispositive motions, expert reports, and so on. Shortly before this conference, however, counsel for the parties informed the Court that they planned to submit an agenda including another significant item: discussion of a proposed class certification and class settlement. The parties then filed, among others, motions for an order conditionally certifying a class, and motions for preliminary approval of a class settlement. As the Court had previously required, plaintiffs’ liaison counsel forwarded copies of these motions, including a copy of the proposed settlement agreement, to counsel for all plaintiffs whose cases had been consolidated in the MDL proceedings. In addition, plaintiffs’ liaison counsel made available the same materials to virtually every plaintiffs’ counsel pursuing litigation against Sulzer' Orthopedics, both in federal and state court. Given the quickly changing nature of the litigation, the Court used the initial case management conference to question the parties in open court regarding their motions for class certification and class settlement. The Court directed its questions to plaintiffs’ liaison and co-lead counsel, and also defendants’ counsel. Given the wide publication of the pending motions, about 125 attorneys from around the country, representing plaintiffs and groups of plaintiffs, also attended the hearing. The Court heard from those proposing preliminary certification and approval, and also heard from a number of counsel, including counsel representing the interests of various state court plaintiffs who were not parties to the MDL proceedings but whose interests could be affected by class treatment of the Sulzer-related claims. Some spoke strongly in favor of the proposed certification and settlement, while others strongly opposed it. During the course of this hearing, it became apparent that the proposed settlement agreement, as drafted, contained provisions that did not accurately reflect the understanding of the parties. Accordingly, the Court directed the parties to submit an amended proposed class settlement agreement by August 24, 2001. The Court then indicated it would allow any interested person (including persons not parties to any federal proceeding) wishing to offer additional objections to the proposed class and amended proposed class settlement agreement to submit their positions in writing by August 24, 2001. The Court received about 41 such comments, all of which it reviewed in detail. On August 28, 2001, the Court held an additional hearing on the pending motions for class certification and preliminary approval of class action settlement. Ultimately, on August 29, 2001, the Court granted the motions for conditional certification of an opt-out settlement class and preliminary approval of the proposed settlement agreement. The settlement class included, essentially, all Americans in whom were implanted a recalled Inter-Op acetabular shell, together with their loved ones. The settlement class at this juncture did not include patients who had received a Natural Knee tibial baseplate implant, in large part because the Court did not yet have jurisdiction over any “knee claimant” — the MDL Panel had not yet transferred to the Court a “knee case.” Although the Court did preliminarily conclude that the proposed settlement was fair and reasonable and adequate, it was clear that a substantial number of plaintiffs and their counsel disagreed and intended, at that juncture, to opt out. The settlement agreement to which the Court gave preliminary approval on August 29, 2001 contained the following basic elements, set out here in simplified fashion: • The parties would create a “Settlement Trust,” which would administer a Research Fund, a Medical Monitoring Fund, a Patient Benefit Fund, and an Extraordinary Injury Fund. • The defendants would put $4 million in cash into the Research Fund, to be used for “medical research relating to reconstructive orthopedic implants ... for the benefit of Class Members.” • The defendants would put $20 million in cash into the Medical Monitoring Fund, to be used to monitor the implants of claimants who had not yet undergone revision surgery. • The defendants would put at least $361.5 million in cash and stock into the Patient Benefit Fund, to pay compensation to implantees and their associated consortium claimants, as follows: — to claimants who did not have revision surgery, $750 in cash, $2,000 in stock, and $500 to their spouses. — to claimants who had one revision surgery, $37,500 in cash, $20,000 in stock, and $5,000 to their spouses. — to claimants who have more than one revision surgery, $63,500 in cash, $34,000 in stock, and $5,000 to their spouses. • The defendants would put another $125 million in cash into the Patient Benefit Fund, to pay for any medical expenses a claimant incurred in connection with revision surgery (or to pay related subrogation claims). • The defendants would provide $33.3 million in cash and stock as payment of attorney fees to claimants’ individual attorneys, at the rate of 1/3 of the claimants’ compensation. • The defendants would provide $4.5 million in cash to cover the costs of administration of the Settlement Trust. • The defendants would put a minimum of $30 million in cash and stock into the Extraordinary Injury Fund, to pay for additional compensation to implantees and their associated consortium claimants, and any amounts not paid out of the other Funds would be transferred into the Extraordinary Injury Fund. • To pay the amounts listed above, the defendants would: (a) put all available insurance proceeds into the Settlement Trust; (b) put all available cash into the Settlement Trust, except for one month’s working capital; (c) put the required number of stock shares into the Settlement Trust; and (d) put 50% of their net annual income into the Settlement Trust. • If the defendants settled a case with an opt-out claimant on terms more favorable than those received under the Settlement Agreement by participating claimants, then the defendants would pay all participating claimants the increment. There are three other notable aspects of the settlement agreement which the Court preliminarily approved on August 29, 2001. First, with regard to the Sulzer Medica stock that the defendants would pay into the Settlement Trust, the stock was to have a minimum guaranteed value — -specifically, the defendants would transfer to the Settlement Trust a certain number of American Depositary Receipts (“ADRs”), valued at $5.10 per ADR. The Settlement Agreement provided that, if the value of an ADR fell below $5.10 at the time of funding, the defendants would make up the difference. Thus, if the value of the stock increased, the value of the Settlement would increase; if the value of the stock decreased, the defendants would put into the Settlement Trust proportionately more stock, so that the total value of the stock would not fall below a certain “floor.” Assuming a “guaranteed” value of $5.10 per ADR, the total “funding value” of the settlement was about $598 million, with about 35% of this value in the form of stock. The actual value of the stock, of course, would fluctuate, depending on the fortunes of Sulzer Medica. Second, the parties estimated that it would take the Settlement Trust about six years to pay out all amounts owed. During this six-year interval, Sulzer Orthope-dies would place liens on virtually all of its assets in favor of the Settlement Trust, to secure all of its obligations. This provision was especially unpopular with certain attorneys, who believed it worked to the disadvantage of opt-out plaintiffs. And third, the settlement agreement was designed with the understanding that plaintiffs’ counsel would have a period of time to pursue further discovery regarding the defendants’ financial wherewithal. That is, the defendants agreed to make available all information reasonably requested by the plaintiffs that would reveal: (1) all of the assets of Sulzer Orthopedics, its parent Sulzer Medica USA, and its Swiss grandparent, Sulzer Medica Ltd.; (2) all of the insurance policies held by these entities that might be available to pay claims; and (3) the likelihood the plaintiffs could “pierce the corporate veil” and pursue claims against Sulzer Orthopedics’ “great grandparent,” Sulzer AG. As the Court explained in its Order granting conditional approval: If plaintiffs conclude that the information they obtain through this discovery shows there is more money available to pay plaintiffs than is currently contemplated by the settlement agreement, then the plaintiffs can withdraw from the agreement, or insist it be modified to account for those other sources of payment; class counsel has assured the Court, in fact, that plaintiffs will withdraw from the proposed agreement if they conclude that the defendants are contributing to this settlement less than substantially all of their available and reachable assets. Furthermore, the parties contemplate sharing all of this discovery information with counsel for all class members, including counsel appearing only in state court. This arrangement will ensure an extremely thorough viewing of the defendants’ financial circumstances by those persons most interested in ensuring that, in fact, the defendants are “suffering” the maximum judgment they can withstand. It is also notable that, by virtue of the settlement agreement, at least one of the defendants (Sulzer Medica Ltd.) is forgoing jurisdictional defenses and contributing to the funds available to the class. It appears that a strong argument can be made that the total judgment available to the plaintiffs pursuant to the settlement agreement is far larger than the sum of any judgments they could ever collect individually. This, again, is an assumption that will be subject to challenge by way of the fairness hearing and discovery process. Order at 38-39 (docket no. 61). D. The Final Class Settlement. Shortly after the Court preliminarily approved the settlement agreement, the defendants moved for an order enjoining all state court litigation. The Court granted this motion, as the Court was convinced that, “given the [then-]current posture of this action, allowing the state court plaintiffs to pursue their parallel state court actions [would] frustrate the proceedings in this case and disrupt the orderly resolution of the MDL litigation.” Order at 7 (docket no. 72). Indeed, it was apparent that, absent a stay, the continuing legal defense costs alone would seriously impair the defendants’ ability to pay anything to the Plaintiff Class, and one or more of the Sulzer defendants would likely declare bankruptcy. Given that the average age of a class member was over 60 years old, a bankruptcy would decrease severely the likelihood that class members would receive compensation during their lifetimes. One of the effects of the Court’s stay enjoining the continuation of all state court litigation was to preclude some very able attorneys, who had vigorously pursued related litigation only in state courts, from continuing their discovery efforts. Accordingly, the Court appointed ten lawyers to a Special State Counsel Committee (“SSCC”), for the purpose of “assisting] in and/or monitoring] the discovery process.” Order at 1 (docket no. 129). These lawyers, who represented class members but did not have a federal case pending within the MDL, joined plaintiffs’ class counsel in the MDL to engage in substantial discovery and strenuous negotiation with counsel for the defendants. As class counsel had hoped, this discovery and negotiation did uncover additional sources of payment and a more accurate understanding of the defendants’ finances. In particular, the attorneys working on behalf of the plaintiffs made three critical gains during their MDL discovery period: (1) although no plaintiff had yet succeeded at obtaining jurisdiction over the “great-grandparent company,” Sulzer AG, the plaintiffs obtained a settlement commitment from Sulzer AG of $60 million in cash and over 480,000 shares of Sulzer Medica stock; (2) although there were some potent full or partial legal defenses available to Sulzer’s insurance companies, known collectively as Winterthur, the plaintiffs obtained a commitment from Winterthur to provide a total of over $216 million toward the settlement; and (3) the Sulzer defendants revealed voluntarily, in unprecedented detail, their total financial condition. After the Court entered its Order staying state court litigation, class counsel moved to file an amended complaint, adding “knee claimants” to the class. On October 19, 2001, the Court granted this motion and conditionally certified an amended class that included recipients of both Inter-Op shells and Natural Knee tibial baseplates, together with their derivative claimants. See docket no. 128. After having completed their discovery and negotiations, the parties submitted a new proposed settlement agreement. The Court conditionally approved this proposed agreement, and scheduled a final fairness hearing. Although the size of the Plaintiff Class exceeded 30,000 individuals (not including derivative claimants), the Court received only 30 or so objections to the fairness of the revised settlement agreement, and all but seven objections were withdrawn before the final fairness hearing. Among the witnesses at this hearing were a number of attorneys, representing hundreds of class members, who had vehemently objected to the first proposed settlement agreement; these attorneys now testified in support of the final proposed settlement agreement. Indeed, there was no witness who testified in opposition to the final proposed settlement agreement and no attorney who argued against its approval. On May 8, 2002, the Court entered an Order granting final certification to the national Plaintiff Class and subclasses, and granting final approval to the settlement agreement between the Plaintiff Class and the Sulzer Defendants. See docket no. 340. Because this Final Settlement Agreement provided that the Sulzer defendants retained the right to terminate and withdraw from the Agreement at any time prior to May 31, 2002, the Court’s May 8, 2002 Order was not a final, appealable Order. After the Sulzer Defendants elected not to exercise their right to terminate the Agreement, however, the Settlement Agreement became irrevocable and the Court entered an Order on June 4, 2002, confirming its May 8, 2002 Order and dismissing all settled claims with prejudice. See docket no. 353. The June 4, 2002 Order explicitly stated: “This judgment is entered pursuant to Fed.R.Civ.P. 58, and is a final appealable Order.” Order at 2. Thereafter, no interested party filed a notice of appeal. Thus, there is no question but that the Court’s June 4, 2002 Judgment Order, giving official approval to all of the terms and conditions contained in the parties’ Settlement Agreement, is final. The Final Settlement Agreement approved on May 8, 2002 was substantially more favorable to the Plaintiff Class than was the first settlement agreement the Court had preliminarily approved on August 29, 2001. The primary improvement was that the “funding value” of the Final Settlement Agreement was approximately $1.045 billion, or about $447 million more than the first settlement agreement. Other improvements included the following: • As noted above, both Sulzer AG and the Winterthur insurers agreed to pay substantial amounts toward settlement. • Compensation for the class increased. For example, compensation payable to a plaintiff who underwent one revision surgery increased from $37,500 in cash and $20,000 in stock to approximately $160,000, most or all of which was in cash, plus another $46,000 in cash available for payment of contingent attorney fees. • Funding for the Extraordinary Injury Fund rose from $30 million to $100 million. • The proposed “six-year liens” running in favor of the plaintiff class on all Sulzer Orthopedic assets were eliminated. • A large percentage of the funds paid by Sulzer Medica came from bank loans and convertible debt instruments, rather than anticipated future earnings. • Plaintiffs who had revision surgery could chose a “Guaranteed Payment Option,” which provided, among other things, a partial payment of at least $40,000 within 45 days. • The parties developed a defined matrix of factors delineating payment entitlements and amounts from the Extraordinary Injury Fund. Last, the Final Settlement Agreement contained a provision that leads the Court to issue the instant Order. The Settlement Agreement stated that it was appropriate for certain attorney fees and expenses to be paid out of the settlement funds to attorneys who had “contributed to the creation of the Settlement Trust through work devoted to th[e] ‘common benefit’ of Class Members, including any attorney who reasonably believe[d] that he or she actually conferred benefits upon the Class Members as a whole through state court litigation, subject to determination by the Court.” Settlement Agreement at § l.l(v) (docket no. 361). The Settlement Agreement further provided that Common Benefit Attorneys shall be entitled to reasonable attorney fees up to a maximum of $50.0 million in the aggregate and to reimbursement of reasonable expenses up to a maximum of $7.5 million in the aggregate, to be paid out of the Sulzer Settlement Trust as approved by the Court. The Common Benefit Attorney fee payment shall be made out of the [proceeds of the] CCI [convertible callable instrument] and the Common Benefit Attorney expenses shall be paid out of the Initial Insurance Proceeds. Settlement Agreement § 5.4. As noted, the question of whether there should be any awards of fees to Common Benefit Attorneys is now settled, as is the question of whether the total amount set aside for such awards is adequate or appropriate, because the Court’s Order approving and adopting the Settlement Agreement and all the provisions therein has not been appealed. An individual attorney may still question the propriety of the amount of his fee award, however, by raising the issue with the Sixth Circuit Court of Appeals, as this issue is normally raised post-judgment, after the awards have actually been entered by the Court. With regard to the procedure an attorney was required to follow to obtain a Common Benefit award, the Settlement Agreement further provided that any attorney seeking an award of expenses or attorney fees as a Common Benefit Attorney “shall first make an application to the Court. The Court may appoint a special master, and with the input of a committee comprised of an equal number of members from Class Counsel and the Special State Counsel Committee, will review all such applications and make a determination with respect to any such attorney’s eligibility to receive payments.” Id. at § 5.5. The Agreement provided that the Expense Awards and Fee Awards “shall be paid to liaison Class Counsel who shall distribute such amounts to Common Benefit Attorneys as approved and allocated by the Court.” Id. at § 5.6. Consistent with these provisions of the Settlement Agreement, the Court appointed four persons to a Common Benefit Attorney Fee Committee. See docket nos. 359 & 364. The Court also issued Proposed Guidelines “outlining how it will receive and examine” applications for Common Benefit Awards. See docket no. 367, Order at 1. After receiving suggestions and objections to the Proposed Guidelines, the Court issued Final Guidelines on how attorneys could make application for Common Benefit Awards. See docket nos. 378 & 576. These Guidelines were quite detailed. For example, the Guidelines: (1) required separate submission of Applications for Fees and Applications for Expenses, both of which had to be in a specific format with specific supporting documentation; (2) set out a lengthy description of work for which attorney fees would not be reimbursed at all; and (3) required submission of attorney biographies, narratives of services performed, and a sworn affidavit affirming the accuracy of all statements made. The Final Guidelines also provided that any applicant or Class Member could file objections to any individual Application for Expenses or Fees. Finally, the Final Guidelines noted that, given the timing of the applications and the availability of funds, “the Court expects it will make its ruling on the Expense Requests] prior to its ruling on the Fee Request[s].” Guidelines at 13-14. Following publication of the Final Guidelines, the Court received 57 applications for Common Benefit Expenses and 57 applications for Common Benefit Fees; a number of these applications were later supplemented, as well. On March 21, 2003, the Court entered an Order setting out common benefit Expense Awards totaling $3,760,583.81 (docket no. 610). The Court made clear that its Order declaring Expense Awards was a final appealable Order, under Fed.R.Civ.P. 58. Subsequently, one attorney asked the Court to provide “a personal itemization of expenses he submitted but the Court disallowed,” which the Court had stated it would supply upon formal request. Id. at 10. No attorney filed any appeal. Having completed its analysis of the common benefit Expense Award applications, the Court now examines the common benefit Attorney Fee Applications. 11. Fee Awards. A. General Standards. With regard to payment of attorney fees, the “American Rule” holds that “the prevailing litigant is ordinarily not entitled to collect a reasonable attorney’s fee from the loser.” Alyeska Pipeline Serv. Co. v. Wilderness Society, 421 U.S. 240, 247, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975). There are, however, several exceptions to this rule. See Chambers v. NASCO, Inc., 501 U.S. 32, 45-46, 111 S.Ct. 2123, 115 L.Ed.2d 27 (1991) (listing exceptions). First, a court may award attorney’s fees to the prevailing party when explicitly authorized by a “fee-shifting” statute, Alyeska, 421 U.S. at 264 n. 37, 95 S.Ct. 1612, or when there is a fee shifting provision contained in an “enforceable contract” between the litigants, id. at 257, 95 S.Ct. 1612. These two exceptions are legal, not equitable, in nature. Second, a court may award attorney’s fees “against a party who had acted in bad faith,” id. at 245, 95 S.Ct. 1612, or against a party who engaged in “wilfull disobedience of a court order,” id. at 258, 95 S.Ct. 1612. These two exceptions derive from the court’s equity jurisdiction, and “the underlying rationale of ‘fee shifting’ [in these circumstances] is, of course, punitive.” Hall v. Cole, 412 U.S. 1, 5, 93 S.Ct. 1943, 36 L.Ed.2d 702 (1973). Finally, “[a]nother established exception involves cases in which the plaintiffs successful litigation confers ‘a substantial benefit on the members of an ascertainable class, and where the court’s jurisdiction over the subject matter of the suit makes possible an award that will operate to spread the costs proportionately among them.’ ” Id. (quoting Mills v. Electric Auto-Lite, 396 U.S. 375, 393-94, 90 S.Ct. 616, 24 L.Ed.2d 593 (1970)). This “common benefit exception” is also equitable in nature and “allows an award of fees to a plaintiff whose suit creates, enlarges, or protects a fund shared by members of a class.” Shimman v. International Union of Operating Engineers, Local 18, 744 F.2d 1226, 1234 (1984), cert denied, 469 U.S. 1215, 105 S.Ct. 1191, 84 L.Ed.2d 337 (1985). Fee shifting is justified in common benefit cases “not because of any ‘bad faith’ of the defendant but, rather, because ‘(t)o allow the others to obtain full benefit from the plaintiffs efforts without contributing equally to the litigation expenses would be to enrich the others unjustly at the plaintiffs expense.’” Hall, 412 U.S. at 5-6, 93 S.Ct. 1943. See Boeing Co. v. Van Gemert, 444 U.S. 472, 478, 100 S.Ct. 745, 62 L.Ed.2d 676 (1980) (the common fund doctrine provides that “a litigant or lawyer who recovers a common fund for the benefit of persons other than himself or his client is entitled to a reasonable attorney’s fee from the fund as a whole”). The Sixth Circuit Court of Appeals has made it clear that it is within the discretion of this Court “to determine the ‘appropriate method for calculating attorney’s fees in light of the unique characteristics of class actions in general, and of the unique circumstances of the actual eases” pending before the Court. Bowling v. Pfizer, Inc., 102 F.Sd 777, 779 (6th Cir.1996) (quoting Rawlings v. Prudential-Bache Properties, Inc., 9 F.3d 513, 516 (6th Cir.1993)). There are two primary (but by no means exclusive) methods to determine a common fund fee award: “the lodestar method [and] the percentage of the fund method.” Rawlings, 9 F.3d at 515. The lodestar method involves the calculation of “the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate.” Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 478 U.S. 546, 565, 106 S.Ct. 3088, 92 L.Ed.2d 439 (1986); see In re Telectronics Pacing Systems, Inc., 137 F.Supp.2d 1029, 1041 (S.D.Ohio 2001) (the lodestar method “requires the class counsel to submit a listing of hours and their rates charged per hour”). This sum may then be “increased by a ‘multiplier’ to account for the costs and risks involved in the litigation, as well as the complexities of the case and the size of the recovery.” Telectronics, 137 F.Supp.2d at 1041 (citing Rawlings, 9 F.3d at 516). In contrast, “[u]nder the percentage of the fund method, the court simply determines a percentage of the settlement to award the class counsel.” Id. Each of the two methods has its own advantages. The percentage of the fund method “is easy to calculate [and] it establishes reasonable expectations on the part of plaintiffs’ attorneys as to their expected recovery.” Rawlings, 9 F.3d at 516. The lodestar method “provides greater accountability.” Id. Also, enhancement of the lodestar with a multiplier “can serve as a means to account for the risk an attorney assumes in undertaking a case, the quality of the attorney’s work product, and the public benefit achieved.” Id. Ultimately, “[t]he lodestar method better accounts for the amount of work done, while the percentage of the fund method more accurately reflects the results achieved.” Id. As noted above, this Court enjoys discretion as to which method it will choose. The ultimate issue is whether the Court’s “award of attorneys’ fees in common fund cases [is] ‘reasonable under the circumstances.’ ” Bowling, 102 F.3d at 779; Smillie v. Park Chem. Co., 710 F.2d 271, 275 (6th Cir.1983). The Court must ensure “that counsel is fairly compensated for the amount of work done as well as for the results achieved.” Rawlings, 9 F.3d at 516. This means that any given attorney should receive neither too little nor too much of an award as compensation for the common benefit he conferred upon the class as a whole. In Bowling, Chief Judge Boyce F. Martin, Jr. of the Sixth Circuit Court of Appeals examined the common benefit fee awards entered by the district court in connection with a case similar to this one: a medical product liability case that ended in a “worldwide class-action settlement.” Bowling, 102 F.3d at 779. After settlement, the district court received five applications for common benefit fee awards. See Bowling v. Pfizer, Inc., 922 F.Supp. 1261 (S.D.Ohio 1996), affirmed, 102 F.3d 777 (6th Cir.1996). The district court ultimately found that two of the applications were well-taken and awarded fees to: (1) class counsel and five special counsel, who had applied jointly in one application; and (2) a public consumer group, which had helped bring the product defect to light and had been an objector during the settlement process. The district court awarded no common benefit fee at all to the remaining three applicants. As to the awards it did enter, the district court “based its fee award on a percentage of the common fund and then cross-checked the fee against class counsel’s lodestar.” Bowling, 102 F.3d at 780. The district court’s two awards totaled slightly more than 10% of the settlement fund. The district court also followed the dictates of Ramey v. Cincinnati Enquirer, Inc., 508 F.2d 1188, 1196 (6th Cir.1974), cert. denied, 422 U.S. 1048, 95 S.Ct. 2666, 45 L.Ed.2d 700 (1975), and examined the reasonableness of its calculations by assessing the fee awards in light of six factors: “(1) the value of the benefit rendered to the 'plaintiff class ...; (2) the value of the services on an hourly basis; (3) whether the services were undertaken on a contingent fee basis; (4) society’s stake in rewarding attorneys who produce such benefits in order to maintain an incentive to others; (5) the complexity of the litigation; and (6) the professional skill and standing of counsel involved on both sides.” Bowling, 102 F.3d at 780. The Bowling Court of Appeals affirmed the district court’s Order in its entirety, finding that the district court’s analysis was “thoroughly reasoned.” Id. Interestingly, one of the disadvantages of using the lodestar method is that it can be “too time-consuming of scarce judicial resources.” Rawlings, 9 F.3d at 516; see Telectronics, 137 F.Supp.2d at 1041-42 (noting that the a court can easily “be-eom[e] entangled in a time-consuming process of toiling over time sheets”). Thus, an argument can be made that a court should not use both the lodestar method and the percentage of the fund method to derive appropriate common benefit fee awards, as did the Bowling district court; although the results may be more accurate and better-reasoned, the effort involved can be prodigious. On the other hand, many courts choose to engage in this “crosschecking” analysis because “the district court has a duty to individual class members to ensure that the requested fee is reasonable, [and] that it does not engender a second major litigation.” Fournier v. PFS Investments, Inc., 997 F.Supp. 828, 831 (E.D.Mich.1998) (using both analyses, and citing Hensley v. Eckerhart, 461 U.S. 424, 437, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983)); see Telectronics, 137 F.Supp.2d at 1042, 1045-46 (primarily using the lodestar method, but conducting informal crosschecks using the percentage of the fund method). In this case, the Court has followed the approach of the Bowling and Fournier courts and used both methods, using each method to cross-check the other and ensure that each attorney who is awarded a common benefit fee receives a reasonable one — neither too large nor too small — -in light of all the relevant circumstances. This double-pronged approach also helped the Court to enter fee awards that reflect accurately the common benefit each applicant conferred upon the plaintiff class relative to each other applicant — a very difficult task, given the large number of applicants. Cf. In re Prudential Ins. Co. of America Sales Practices Litigation, 148 F.3d 283, 329 n. 96 (3rd Cir.1998), cert. denied, 525 U.S. 1114, 119 S.Ct. 890, 142 L.Ed.2d 789 (1999) (given a stipulation amongst 25 law firms regarding attorneys fees in a class action settlement, the court did not have to “undertake the difficult task of assessing counsels’ relative contributions”). By using both the lodestar method and the percentage of the fund method, the Court has ensured its fee awards are reasonable and appropriate both individually and in toto. B. Case-Specific Standards. Before applying the six factors set out in Ramey that this Court must assess when entering fee awards, the Court lists certain standards it employed specifically in this case. The Court used these standards primarily within the context of the lodestar method of its two-pronged analysis, but also considered these standards in the context of the percentage-of-the-case method: “The same factors used to calculate lodestar multipliers determine what is an appropriate percentage to award.” Weil v. Long Island Sav. Bank, FSB, 188 F.Supp.2d 265, 268 (E.D.N.Y.2002) (citing Goldberger v. Integrated Resources, Inc., 209 F.3d 43, 47 (2nd Cir.2000)); see Brown v. Phillips Petroleum, Co., 838 F.2d 451, 454-55 (10th Cir.1988), cert. denied, 488 U.S. 822, 109 S.Ct. 66, 102 L.Ed.2d 43 (1988) (“[b]eeause [the lodestar] factors measure the attorneys’ contributions, they are also appropriate in setting and reviewing percentage fee awards in common fund cases”). As noted above, following publication of the Final Guidelines regarding counsel’s requests for common benefit awards in this case, the Court received 57 applications for Common Benefit Fees. The Court received one objection to all of these applications. The Court has spent a significant amount of time reviewing in detail the applications and supplements, the supporting documentation, the advice of the Common Benefit Attorney Fee Committee, and the objection and responses thereto. These materials fill about seven banker’s boxes. In several instances, the Fee Committee corresponded with counsel, asking for an explanation of a claimed expense or fee. In a few instances, the Court wrote its own letters to the applicants, asking for clarification or explanation of the requests, or expressing concern about apparent violations of the Court’s Guidelines. With the help of the Common Benefit Attorney Fee Committee, the Court examined virtually every entry listed in every Fee Application. The Court then applied the following six categories of guidelines to determine whether a given attorney fee was properly reimbursable. The first three categories are the ones that most often required the Court to reduce its calculation of a given attorney’s common benefit Fee Award. First, and primarily, a given attorney fee was reimbursable only if it actually advanced the interests of the entire Plaintiff Class. Fees that were charged for counsel’s efforts taken primarily for the benefit of a given individual plaintiff, or even a smaller group of plaintiffs, and not the entire class of plaintiffs as a whole, did not qualify for reimbursement, as they did not provide a true “Common Benefit.” Although it could be argued that the activity associated with a certain fee did provide some benefit to the entire class, the Court disallowed that fee if the asserted beneficial connection to the entire Plaintiff Class was tenuous, or if the associated activity may be fairly said to benefit an individual plaintiff or group of plaintiffs more than the entire Plaintiff Class. Second, fees charged by an attorney merely to attend a meeting or conference related to the Multi-District Litigation, when the attorney’s presence was not reasonably necessary, were not reimbursable. Examples of attorney fees disallowed under this rule include: (1) fees related to attendance at the initial MDL Panel hearing in Washington, D.C., unless the attorney actually presented argument in relation to the Motion to Consolidate the Sulzer cases; (2) fees related to attendance at conferences sponsored by ATLA, Mealey’s, or similar groups, unless the attorney was authorized to make a presentation to the group by MDL lead counsel or the Special State Counsel Committee; (3) fees related to attendance at depositions by more than one attorney per law firm, unless the law firm actually conducted the deposition; (4) fees related to attendance at any meeting that was related primarily to an individual case, and not the MDL; and (5) fees related to attendance at any MDL conference or hearing, unless the attorney: (a) was Class Counsel, Special Counsel, a member of the Plaintiffs’ Steering Committee, or a member of the Special State Counsel Committee, or (b) actually engaged in material, substantive participation at the conference or hearing. Third, the Court disallowed fees to the extent that: (1) “the amount of ‘review’ time [was] excessive as a whole when judged in reference to the role which the Attorney, or other timekeeper, had in the litigation,” Guidelines at 7; (2) the amount of time listed was “grossly excessive on its face, when considered as a whole in light of the role which the Attorney, or other timekeeper, had in the litigation,” id.; and (3) the amount of time it took for a given task was more than was reasonable or necessary. To summarize simply the first three guideline categories: the Court did not allow reimbursement for fees associated with an attorney’s time unless it truly appeared well-spent, to the benefit of the entire class. Notably, with regard to some attorneys, application of these guidelines did not reduce the lodestar calculation at all; with other attorneys, these guidelines reduced the lodestar calculation dramatically. Indeed, as to some timekeepers, the Court concluded that none of their hours listed were properly reimbursable. For one reason or another, the Court reduced the “hours worked” factor in its lodestar calculation for about half of the applicants. Ultimately, however, the Court found that only about 5.9% of the 53,671 total timekeeper hours listed by all timekeepers was not spent on reimbursable, common benefit activity. Similarly, just as the Court did not allow reimbursement of fees for certain hours listed by several applicants, the Court also did not allow reimbursement of fees at certain rates listed by several applicants. Because the hourly rates submitted by attorneys of the same experience varied substantially, the Court “equalized” the attorneys’ lodestar calculations by substituting the following hourly rates, depending on years of practice: 1-5 years, $200/hour; 6-9 years, $300/hour; 10-14 years, $400/ hour; and 15 years and over, $500/hour. This recalculation worked to reduce the hourly rate of about 1/6 of the attorneys who applied for common benefit fees. Fourth, fees were not reimbursable if the attorney did not document them properly. Among other things, the Final Guidelines required attorneys to submit daily, monthly, and total time sheet summaries that: (1) followed a particular format, including organization by timekeeper and listing of cumulative totals; (2) included hourly rates and description of professional status (e.g., partner, paralegal, and so on); and (3) described in sufficient detail the nature and purpose of the legal service provided. Fifth, the Court examined the amount of fees each attorney expects to receive in connection with this litigation from other sources. Specifically, the Court examined: (1) arrangements under which an attorney expects to pay to, or receive from, other persons any portion of any Common Benefit Fee Award; and (2) the net amount of contingent fees the attorney or his law firm will receive pursuant to their own contracts with class members. With regard to this latter issue, the Settlement Agreement states explicitly, in Section 5.5, that “the Court shall consider, among other factors, any contingent fee paid to a Common Benefit Attorney pursuant to Section 5.1 and Section 5.2 when making an award of a fee.” As the Court explained in the Final Guidelines: When the Court approved the Settlement Agreement in this case, which included payment of a substantial portion of those contingency fees owed by represented claimants to their individual counsel, the Court took into consideration the fact that counsel’s efforts on behalf of these individual claimants also conferred a measurable benefit upon the class as a whole. Having taken the unusual step of authorizing the payment of contingency fees out of settlement proceeds—thereby spreading the cost of those contingency fees across the entire class, including unrepresented claimants—the Court concludes it is inappropriate to also award out of common benefit funds any item of time or expense incurred in connection with the trial of individual eases or groups of cases, or the case-specific preparation of those cases for trial. Guidelines at 6-7 n. 1. In other words, the partial payment by the Settlement Trust of contingent fees owed by certain class members to their attorneys is not only a benefit to those class members, it is also a monetary recognition that the attorneys’ general litigation efforts, and/or advice to their clients to participate in the settlement agreement, provided a common benefit to the entire class. Thus, an attorney’s receipt of contingent fee payments out of the settlement trust, rather than out of an award to his individual client, must be a factor in the assessment of that attorney’s common benefit fee award. And sixth, the Court was careful to state in its Final Guidelines that “[a]ny intentional violation of these Guidelines is grounds for the Court to deny a request for payment of counsel fees or reimbursement of litigation expenses in whole or in part, as well as for such other sanctions and penalties as may be appropriate under the law.” Guidelines at 13. Indeed, attorneys were required to submit sworn affidavits affirming the accuracy of the information contained in their applications. As a general rule, attorneys who applied for Common Benefit Awards were “careful to comply with the Final Guidelines and did not request reimbursement for [fees] that the Guidelines clearly disallowed. This was especially true of those attorneys who did the most Common Benefit work.” Expense Award Order at 9 n. 15 (docket no. 610). Unfortunately, there were also attorneys who submitted Fee Applications containing incorrect information that went beyond being less-than-careful; a very small minority of Fee Applications contained material misstatements that could not have been accidental. The Court has reduced its award of common benefit fees to attorneys who engaged in what the Court can characterize only as reckless or intentional violations of its Guidelines. In addition to the six categories discussed above, the Court also examined a critical, seventh factor regarding the propriety of awarding a common benefit fee. The Court has been forced to take notice that several attorneys who submitted applications for Common Benefit Attorney Fee Awards have, in fact, taken action subsequent to finalization of the Settlement Agreement that is detrimental to the common benefit of the class. At the Final Fairness Hearing, the Court had to determine whether the Final Settlement Agreement was fair, adequate, and reasonable. One of the critical factors in making this assessment was whether the then-conditionally certified class included all persons who might have been injured by a defective Sulzer product. In other words, the Court wanted to be absolutely sure that the Final Settlement Agreement: (1) did not “leave out” any person who should receive compensation; and, at the same time (2) resolved (or, at a minimum, clearly defined) for the defendants all disputes arising out of the recalls that were the subject of the settlement. This concern was also shared by counsel for all parties: counsel for plaintiffs wanted to ensure the class was defined with sufficient breadth because counsel wanted no deserving person left uncompensated; counsel for defendants also wanted to make sure the class was defined with sufficient breadth because counsel wanted to achieve a truly global resolution, and not face additional litigation after settlement (other than opt-out litigation), based on essentially the same set of facts. Thus, there was substantial testimony at the Final Fairness Hearing to the effect that: (1) the hip and knee implant recalls, and thus the definition of the class in this case, were probably over-inclusive, “to err on the side of patient safety;” and (2) the timetables imposed by the claim deadlines were generous, ensuring that 99.9% or more of the class population needing revision surgery would obtain it before the deadline. See Final Fairness Hearing tr. at 278 (Joseph Poirkowski); id. at 149-58 (Victor Goldberg). The scientific and statistical evidence also showed the extremely high likelihood that any person who required revision surgery connected with a Sulzer implant, but who was not a member of the defined plaintiff class, was excluded because their need for revision surgery had no connection with the product defect at issue in this case. Furthermore, there was testimony from a number of Fee Award applicants averring strongly that the Final Settlement Agreement — -including the class and sub-class definitions— was fair, adequate, and reasonable. Nearly all of the clients of the Fee Award applicants then participated in the Settlement. That is, these clients followed counsel’s advice, chose not to opt out, and submitted claims forms to the Claims Administrator. It turned out, however, that a number of these clients were not class members after all, because they had not been implanted with an affected product; accordingly, they did not submit claims forms, or they did, but their claims were denied. Despite this, some of the Fee Award applicants continued to pursue compensation from Sulzer on behalf of these clients by bringing suit in an alternative forum. Essentially, these attorneys: (1) originally claimed that their clients were harmed because they received one of the defective Sulzer implants that were a part of the recalls; (2) learned that, in fact, their clients did not receive such a product; and (3) decided to seek compensation from Sulzer anyway. Notably, the allegations in many of the complaints in these cases did noc change and were premised on the same product recalls and the same facts and circumstances. The pursuit of litigation against the Sul-zer defendants on behalf of plaintiffs not included in this class action, under the same theory of liability as in this class action, is simply inappropriate. Counsel cannot, on the one hand, represe .t to the Court that the Settlement Agreement fairly and adequately includes in the plaintiff class all persons injured by the defective products, and, on the other hand, represent non-class-members in separate lawsuits against the same defendants on the same theory of liability; the two representations cannot be made at the same time in good faith. In essence, counsel must argue, with these latter lawsuits, that: (1) the defendants did not, after all, pay the maximum amount to settle the class action; and (2) the defendants did not, after all, pay compensation to all persons who were harmed by the defective products. In other words, counsel must now argue that, contrary to their earlier representations to the Court, they did not maximize the common benefit in this class action. Indeed, these dichotomous positions go beyond being a misrepresentation to the court; they create substantial conflicts of interest. From the beginning, the primary interest of class members was to maximize their compensation from Sulzer, through imposition of the highest possible monetary settlement payable to the class. Any non-class member who sued Sulzer necessarily sought compensation that would not be available to the class, an interest in direct conflict with that of the class members. It is even true, moreover, that, by pursuing litigation against Sulzer on behalf of non-class members, these attorneys have and are continuing to put at risk Sulzer’s ability to make all promised payments to the class — many of which payments, as noted above, have not yet been made, either because they are not yet due or because certain contingencies on which they are premised have not yet occurred. The simultaneous representation of both types of plaintiffs by counsel is, at the least, highly problematic. It means that counsel, knowing they were omitting certain of their clients from receiving class benefits, argued to this Court that the class was fully inclusive, and are now essentially arguing that the class was under-inclusive. It also means that counsel argued to this Court that the compensation to class members was fair, and are now arguing that other clients, purportedly injured in the same way, should be entitled to payment upon terms potentially more favorable than those afforded to class members. This seventh factor has a substantial impact on the Court’s final analysis of whether the totality of an appli