Full opinion text
ORDER AND MEMORANDUM MILES W. LORD, Chief Judge. I. INTRODUCTION AND CASE HISTORY This proceeding commenced upon a Petition filed on May 28, 1981, by Peter R. Cohen (Cohen) and Deborah D. Riordan (D. Riordan) as administratrix of the estate of Edward J. Riordan (E. Riordan), deceased, against respondent International Rectifier Corporation (Rectifier). Cohen and E. Riordan (C&R) represented Rectifier in the matter of International Rectifier Corporation et al. v. American Cyanamid Company et al., 69-2484 HP, (Cal.), 70 Civ. 180 (N.Y.) and 474 Civil 372 (Minn.) from December 16, 1969, to August 14, 1975 (the “main action”). The main action was first transferred from California to New York, as a “tag-along” case by the Multidistrict Panel, pursuant to 28 U.S.C. § 1407 for coordinated and consolidated pretrial proceedings together with over one hundred other cases there pending and known as the broad spectrum antibiotics litigation, In Re Coordinated Pretrial Proceedings In Antibiotic Antitrust Actions. See In Re Multidistrict Civil Antitrust Actions Involving Antibiotic Drugs, 295 F.Supp. 1402 (1968). The majority of those cases were disposed of in a negotiated settlement which was approved and affirmed by the New York District Court. West Virginia v. Chas. Pfizer & Co., 314 F.Supp. 710 (S.D.N.Y.1970), aff’d 440 F.2d 1079 (2d Cir. 1971). On November 30, 1970, Mr. Chief Justice Burger designated this Judge to the Southern District of New York, pursuant to 28 U.S.C. § 292 et seq., and on December 2, 1970, the Multidistrict panel assigned all of the sixty “non-settling” cases to this Court for coordinated and consolidated pretrial proceedings pursuant to 28 U.S.C. § 1407(b). In Re Antibiotic Drugs, 320 F.Supp. 586 (Jud.Pan.Mult.Lit.1970); Pfizer Inc. v. Lord, 447 F.2d 122 (2d Cir. 1971). The main action was one of the “competitor cases” thereby assigned to this court. In Re Coordinated Pretrial Proceedings in Antibiotic Antitrust Actions, CCH 1972 Trade Cases 93,067 (D.Minn.1971). On May 17, 1971, this Court transferred the majority of the “non-settling” cases to the District of Minnesota for trial before this Court under 28 U.S.C. § 1404(a). The basis of this Court’s decision was that the convenience of the parties and witnesses and the interests of justice would be served by that transfer. This Court was affirmed in so doing. Pfizer Inc. v. Lord, 447 F.2d 122 (2d Cir. 1971). During coordinated and consolidated discovery proceedings before this Court, C&R were among the most active, if not the most active lawyers, in preparing the liability issues common to all cases for trial. On July 11,1974, this Court transferred the main action to the District of Minnesota for trial, and on August 1, 1974, this Court consolidated the main action for trial with five other cases then set before this Court for trial. That consolidated trial began on November 18, 1974. Prior thereto, four independent patent infringement actions instituted in the Central District of California against Rectifier, two by Cyanamid and two by Pfizer, (the “related actions”), were transferred to this Court by the Multidistrict Panel for coordinated and consolidated pretrial proceedings. One of those actions, entitled Pfizer Inc. v. International Rectifier, 73-58—R (Cal.); 4-73 Civil 188 (Minn.) (1973) (the “doxycycline case”), charging Rectifier with infringement of U.S. Patent No. 3,200,149 (the “doxycycline patent”) was transferred to this Court by the Multidistrict Panel on March 12, 1973, for such coordinated and consolidated pretrial proceedings, In Re Antibiotic Drugs Antitrust Litigation, 355 F.Supp. 1400 (Jud.Pan.Mult.Lit.1973), on the grounds, among others, that: . .. the antitrust allegations asserted as a defense to Pfizer’s infringement action involve issues already raised in the so-called “competitor actions” brought against Pfizer and others, which are pending in the transferee court. To this extent, the doxycycline action in California presents issues of fact common to the proceedings in Minnesota. . . . [W]e do not agree with plaintiff that, if its action is transferred to Minnesota, its attempt to enforce its patent will become “bogged-down” in the consolidated proceedings. Rather, we are convinced that the transferee judge, who has extensive familiarity with the issues and the parties involved in this litigation, is in the best position to schedule the necessary discovery . .. with a minimum of delay and inconvenience to all parties concerned. Id. at 1401-02. C&R represented Rectifier in the four independent actions so transferred to this Court, and the doxycycline action consumed a substantial amount of this Court’s time and effort during the coordinated and consolidated pretrial proceedings and even during the trial of the consolidated cases. Pfizer Inc. v. International Rectifier Corp., 182 U.S.P.Q. 595 (D.Minn.1974); Pfizer Inc. v. International Rectifier Corp., CCH 1975 Trade Cases (D.Minn.1975); Pfizer Inc. v. International Rectifier Corp., 186 U.S.P.Q. 511 (D.Minn.1975); Pfizer Inc. v. International Rectifier Corp., 538 F.2d 180 (8th Cir. 1976). In one of those eases, this Court said: The commonality of issues in this patent infringement case and the other cases involved in these coordinated proceedings . . . makes this Court the most efficient and practical forum for deciding the issues raised. In addition, this Court has acquired considerable background knowledge of both the issues and the proceedings before it. It would be impractical, therefore, to permit a situation to continue where the efforts of the principal counsel [C&R] in the patent infringement case would be split between a determination of issues in this Court, and the determination of some of the same issues in another forum. Such a division of effort would irreparably injure the Defendants [e. g., Rectifier] in this case by subjecting them to duplicative proceedings, unnecessary expense, and impairment of their ability to prepare for trial. Moreover, it would also cause some hardship and delay to many of the other related cases consolidated with this one for pretrial preparation. Because Pfizer has failed to establish that it would suffer injury, there appears to be no reason to risk the impairment of this Court’s jurisdiction, the harm to Defendants, and the delay of this and many other related actions before the Court by denying the injunction requested by Defendants. In addition, the Court also finds that Pfizer’s decision to proceed in a new forum . . . amounts to forum shopping. It is an effort to circumvent this court’s jurisdiction . .. the forum it initially chose .... This forum shopping appears to be a method of doing one of two things: Either delaying the present proceedings . . . which are before this Court, or frustrating them entirely and taking the power which is legally assigned to this Court when the matters are properly before this Court for adjudication and frustrating the efforts of the Court to arrive at an effective resolution of the problem. This Court has authority to enjoin a party from proceeding [in another forum] when it has first obtained jurisdiction of the case. Such an injunction may issue when, as here, it is necessary to prevent the waste and duplication of effort involved in twice trying the same issues .... This Court has the power, therefore, to prevent a party from engaging in conduct which would destroy the status quo or impair this Court’s ability to render an effective judgment and award meaningful relief. 182 U.S.P.Q. 595. The main action, and the five other cases consolidated for trial therewith, proceeded in trial before this Court from November 18, 1974, to August 14, 1975, when the main action settled. As this Court said in In Re Coordinated Pretrial Proceedings in Antibiotic Antitrust Actions, CCH 1976-2 Trade Cases, 69,775: In order to conserve judicial time, the [six] cases were consolidated to be tried before two juries. The competitor eases were to be tried to one jury while the United States Government case along with other purchasers (the Union Health and Welfare cases, the Mutual of Omaha case and the California Physicians Service case) were to be tried to another jury. Eight months after the start of trial International Rectifier settled. (International Rectifier et al. v. American Cyanamid Co. et al., 4-74 Civil 372) . . . for $33 million .... In January of this year [1976], the Mutual of Omaha case and the Malcolm-Gregg case also settled. (Mutual of Omaha v. American Cyanamid Co. et al., 4-71 Civil 6; Malcolm-Gregg Co. Inc. et al. v. Chas. Pfizer & Co. Inc. et al. Civil 4-74-373). This Court has received a special mandate to conduct this litigation “with scrupulous fairness and impartiality.” . . . Pfizer v. Lord, 456 F.2d 542 [532] (8th Cir. 1972), cert. denied, 406 U.S. 97 [976, 92 S.Ct. 2411, 32 L.Ed.2d 676] (1972). After the main action settled, C&R were retained as special trial counsel by the plaintiffs and their counsel in the Mutual of Omaha class action cases and also by the plaintiffs and their counsel in the Union Health and Welfare class action cases. C&R were thereupon substituted in as co-counsel of record in those cases and represented those class action plaintiffs until those cases settled in January and February of 1976, the former for $12.5 million and the latter for $4 million. In September of 1973, prior to the start of the trial in the Rectifier main action and the five other consolidated cases, the six non-settling state cases settled. In this Court’s decision in In Re Coordinated Pretrial Proceedings, etc., 410 F.Supp. 706 (D.Minn.1975), this Court in fixing and setting attorneys’ fees for counsel for those six state plaintiffs stated that: In February of 1973, depositions commenced. Over 400 depositions were taken in this case, in all parts of the United States, Europe, Australia and Hong Kong. Many of these depositions were taken directly by the CCS [City, County, State] Plaintiffs. Others were taken by the PNSC [Plaintiffs’ National Steering Committee], In the long run, all of the discovery efforts conducted by the PNSC were helpful to all of the Plaintiffs and were contributed to by all Plaintiffs. Id. at 710-711. . . . The Court feels that these particular private attorneys have fulfilled their role as private attorneys-general in a very able and capable fashion. Accordingly, the Court is going to award fees to both the Attorney General of the State of California and to the Attorney General of the State of Oregon as if they were private lawyers. Id. at 717. The role of the United States government attorneys and counsel for International Rectifier Corporation, a competitor, also contributed to the result, [emphasis added] Id. at 722. The Court was, again, there referring to C&R. C&R conducted the majority of the 400 depositions concerning the common liability issues and also took the lead with respect to the non-settling plaintiffs’ joint sets of interrogatories to the antitrust defendants. C&R’s role in pretrial and trial activities contributed to, not only the settlement of the farm cases and the state cases, but also to the settlement of the Union Health and Welfare cases and the Mutual of Omaha cases. C&R did not petition for any fees or costs in the farm cases, the state cases, or any of the other cases which were disposed of in the Court. The various members of the PNSC, however, reimbursed Rectifier for a percentage of out-of-pocket costs incurred by Rectifier in financing common discovery conducted by the PNSC for the benefit of all nonsettling plaintiffs. In mid-1976, after the Rectifier main action was settled and dismissed, and upon Rectifier’s Petition for relief, this Court enforced the PNSC agreement requiring reimbursement of certain financing costs to Rectifier against Continental Vitamin. Rectifier did not assert at that time that this Court had no continuing or ancillary jurisdiction to do so, but then asked for and received the aid of this Court. In April of 1976, C&R petitioned this Court for reasonable fees and costs in representing the Mutual of Omaha class action eases and the Union Health and Welfare class action cases as special trial counsel between August 1975 and February 1976. This Court awarded C&R $300,000 in the Mutual of Omaha cases and $100,000 in the Union Health and Welfare cases on C&R’s representation and the Court’s understanding that C&R would receive fair compensation for its services as special trial counsel when the total of $400,000 awarded in those cases was considered in conjunction with the contractual contingency fee Rectifier agreed to pay to C&R for its services. See Farmington Dowel Products Co. v. Forster Mfg. Co., 421 F.2d 61 (1st Cir. 1969). C&R’s May 28, 1981, Petition sought to invoke the ancillary jurisdiction of this Court to resolve a fee dispute between C&R and Rectifier arising out of Rectifier’s employment of C&R pursuant to a May 16, 1974, letter agreement between Rectifier and C&R. It is asserted by C&R and admitted by Rectifier in its “Motion for Stay of Temporary Restraining Order,” filed in the United States Circuit Court of Appeals, Eighth Circuit, on June 12, 1981, and denied by that Court without prejudice on June 15, 1981, that “the litigation out of which the escrow arose did occur in Minnesota.” C&R’s Petition and their affidavits filed herein make it clear beyond question that the instant fee dispute arose out of the C&R-Rectifier May 16, 1974, fee agreement letter which contemplated the start of the trial of the main action in this Court before the end of 1974 and the performance of that agreement by C&R in this Court, and escrow instructions entered into between C&R and Rectifier on September 15, 1975, pursuant to that fee agreement whereunder C&R posted their 8%% bonus fee, amounting to approximately $2.4 million, in escrow as security for the indemnity set forth in the fee agreement letter. C&R’s Petition and other moving papers filed herein recite the following factual chronology. In 1969, Rectifier retained the Beverly Hills, California law firm of Rosenfeld, Meyer and Susman (RM&S) in order to obtain the legal services of Cohen and E. Riordan in the contemplated main action. Rectifier so retained RM&S on March 12, 1969, pursuant to a written V3 contingent fee agreement signed by Cohen for RM&S and by E. Lidow for Rectifier. On April 30, 1974, C&R withdrew from RM&S. On May 14, 1974, Rectifier, which had retained Kaplan, Livingston, Goodwin & Selvin, concerning the break-up of RM&S, and with that firm’s advice and counsel, discharged RM&S and terminated the RM&S-Rectifier fee agreement. On May 16, 1974, Rectifier, again with the advice and counsel of the Kaplan firm, retained C&R, who had then formed the firm of Cohen and Riordan to represent Rectifier in the main action and the related actions during the pendency of the main action. That letter agreement provides, in part that: This letter will serve to confirm our fee agreement with respect to the above entitled action (“said action”), all other actions filed in the United States relating to broad spectrum antibiotics (BSA’s) which are now or hereafter may be pending during the pendency of said action, and the Tariff Commission proceeding now pending between Pfizer and you (“the related actions”). C&R shall devote substantially all of Edward J. Riordan’s (“EJR”) and Peter R. Cohen’s (“PRC”) professional services to said action (and during a trial anticipated to commence in the fall of 1974, all of their services) so long as the same are reasonably necessary to the proper prosecution of said action, such services to be rendered until the conclusion of said action, whether by final judgment or settlement. C&R shall receive for their services in said action and the related actions (during the pendency of said action) the following: A. You shall pay C&R the sum of $250,000.00 per year, prorated for any part of a year. . . . C. Eight and three-quarters percent (8%%) of the net amount recovered by you in said action, less all sums paid by you to us pursuant to subparagraphs A and B above. For the purposes of this subparagraph, “net amount recovered by you shall be computed as follows: (1) The gross amount recovered by you in said action shall be that cash amount which you recover and actually receive by way of final judgment or settlement, including attorneys’ fees, less any amount awarded to any defendant in said action or the related actions. (2) From the gross amount recovered by you there shall be deducted: (a) All out-of-pocket costs and expenses paid or payable by you to C&R pursuant to paragraph 3 below. (b) All costs and expenses paid or payable by you to others pertaining or relating to said action and the related actions. (c) All amounts heretofore paid by you to Marc S. Gross, Hubbell, Cohen & Stiefel and Rosenfeld, Meyer & Susman for services rendered in said action and the related actions. (d) For the purpose of assuring you that sufficient funds will be available to satisfy the indemnity and hold harmless provisions set forth in paragraph 4 below, within thirty (30) days of your receipt of the net amount recovered by you from any settlement or judgment in said action, you shall place eight and three-quarters percent (8%) thereof in an interest-bearing escrow account, to there remain (except for accrued interest, which we may withdraw) until the later of (i) the final resolution of any proceeding involving any claim referred to in paragraph 4 below, or (ii) one (1) year following the date of such receipt. (4)(a) Up to the limit of any amounts payable to us pursuant to paragraph 2c above, provided the total fees agreed to be paid by you to any other counsel you may engage to represent you along with us in said action do not exceed six percent (6%) of the net amount recovered by you, we will indemnify you against and hold you harmless from any and all claims by anyone other than parties to this agreement, or liability, loss, cost or expense directly or indirectly arising out of your employment of us or out of the execution or performance of this agreement to the extent that such liability, cost or expense exceeds thirty-three and one-third percent (33V3%) of the gross amount of money received by you by way of final judgment or settlement, including attorneys’ fees recovered, less court costs recovered in said action. (b) The indemnity and hold harmless provisions set forth in paragraph 4(a) shall not apply to any decision obtained in any arbitration proceeding (whether or not confirmed by a court of competent jurisdiction) or to any settlement with any such third party unless we consent in writing to such arbitration or settlement prior thereto, [emphasis added] On May 17, 1974, C&R were substituted of record in the main action and the related actions were all before this Court. The main action sought to invalidate, specifically, the Jukes Patent involved in American Cyanamid Co. v. International Rectifier Corp., 71 Civil 2683, and the doxycycline patent involved in Pfizer Inc. v. International Rectifier Corp. et al., 4-73 Civil 188 (Minn.) and to render all broad spectrum antibiotic patents unenforceable for various alleged violations of the federal antitrust laws, (15 U.S.C. §§ 1, 2 and 14), and sought over $100 million in single damages. As noted above, the main action began trial together with the other five actions consolidated for trial before this Court on November 18, 1974. On August 14, 1975, the Rectifier case was settled for $33 million. That settlement included the settlement of three of the four related actions for royalty-free licenses, but excluded the doxycycline case and the main action which was pleaded as an affirmative defense therein from that overall settlement. The settlement amount of $33 million included an unspecified amount for Rectifier’s attorneys’ fees and Rectifier’s costs which were also unspecified. The doxycycline case was then on appeal by Pfizer Inc. from this Court’s partial summary judgment of July 16, 1975, holding the doxycycline patent to be invalid. Pfizer Inc. v. International Rectifier Corp., 186 U.S.P.Q. 511 (D.Minn.1975). The settlement agreement and the dismissals with prejudice of the main action and the related actions (other than the doxcycline case) were filed and lodged in this Court together with a side letter dated August 12, 1975, from all defendants to Rectifier stating: It is the understanding of the Defendants that neither the “settlement agreement” nor the stipulation of dismissal with prejudice in this case is intended to affect one way or another whether the United States District Court for the District of Minnesota would have jurisdiction to hear or resolve any claim against Rectifier which is based upon or related to the filing, prosecution or settlement of this case and which is made by any attorney or law firm who has been, or may claim to have been, counsel for Rectifier or for any of the other “parties of the first part” [Rectifier affiliates] to the settlement agreement, [emphasis added] The settlement agreement provides in paragraph 12 that: The parties of the first part [Rectifier] shall jointly and severally indemnify and defend each and any of the parties of the second part [the antitrust defendants], and hold them harmless, from any and all claims, controversies, disputes, differences, actions or judgments which may be asserted by any attorney or any law firm . . . claiming, or who may claim, to have been counsel for any of the parties of the first part [Rectifier] and to have any lien, interest or any other claim of any nature whatsoever upon the claims herein settled or the proceeds thereof, the sums being paid in settlement, or the civil actions being settled. The parties of the second part [the antitrust defendants] shall promptly notify the parties of the first part [Rectifier] of any such claim. C&R’s verified Petition asserts that the side letter was intended to reserve this Court’s ancillary jurisdiction over all Rectifier attorney-client fee disputes, including the C&R-Rectifier dispute raised by the Petition, while at the same time terminating this Court’s jurisdiction over the antitrust defendants for any such dispute to the extent that the parties could control that jurisdiction. Rectifier has not offered any verified explanation for the side letter, but in argument of counsel has relied upon the phrase “to affect one way or another” to mean that Rectifier and its attorneys intended to forego ancillary jurisdiction over any later attorney-client fee dispute in this Court. On August 15, 1975, the antitrust defendants paid the sum of $33 million to Rectifier by federal wire transfer. In September of 1975 Rectifier and C&R created an escrow account at the Security Pacific National Bank (the “California Bank”) to carry out the intent of the “interest bearing escrow account” provided for by Paragraph 2.C.(2)(d) of the C&R-Rectifier fee agreement. Paragraph 2.C.(2)(d) requires that: . . . within thirty (30) days of your receipt of the net amount recovered by . . . settlement or judgment in said action [which is the main action] [Rectifier] shall place eight and three-quarters percent (8%%) thereof in an interest bearing escrow account to there remain (except for accrued interest, which [C&R] may withdraw). Paragraph 2.C.(2)(d) also provides that the purpose of the interest-bearing account is to provide “sufficient funds” for the C&R “indemnity and hold harmless provisions set forth in paragraph 4.” Paragraph 2.C.(2)(d) of the C&R-Rectifier fee agreement therefore required creation of the interest-bearing escrow account, or escrow, for the purpose of C&R posting their 8%% bonus fee as security that C&R would have sufficient funds for the paragraph 4 indemnity expressly referred to in paragraph 2.C.(2)(d), which indemnity is limited by paragraph 4(a) to the amount of the 8%% bonus fee. The Court therefore notes at the outset that the escrowed funds are the property of C&R, not Rectifier, and that Rectifier has no right to any part of the escrowed funds until and unless an indemnity event occurs. The September 15, 1975, Escrow Instructions required Rectifier to deposit therein by September 18, 1975, the sum of $2.4 million and either add to or receive back a sum which, by March 1, 1976, Rectifier and C&R would agree to “as a result of the final accounting agreed to” between Rectifier and C&R regarding C&R’s 8/4% bonus fee. By March 1, 1976, Rectifier and C&R had entered into that final accounting and since that date the escrow has contained the sum of $2,450,518 pursuant to the Rectifier-C&R final accounting. Under the terms of the Escrow Instructions, C&R have invested the principal amount of $2,450,000 in authorized securities and have received all of the income and interest derived from that principal amount, as provided in the Escrow Instructions and also as provided in paragraph 2.C.(2)(d) of the fee agreement letter. The Escrow Instructions also provide that the California Bank shall not be concerned with the C&R-Rectifier fee agreement’s terms, but shall pay over the principal amount of $2,450,518 as directed by Rectifier and C&R upon final determination of certain related matters referred to in the C&R-Rectifier fee agreement. By their verified Petition and by affidavit, C&R state that the paragraph 4 indemnity was intended to cover any liability imposed upon Rectifier by a trial court judgment in the expected suit by RM&S for the one-third contingency fee or for quantum meruit, i. e., an attorneys’ fee award recovered by RM&S if when added to C&R’s fee of $250,000 per annum and their 8%% contingent bonus fee, exceeded the one-third contingent fee as defined in the RM&S-Rectifier fee agreement. C&R assert that the indemnity of paragraph 4 was intended by the parties to insure that the policy of Fracasse v. Brent, 6 Cal.3d 784, 100 Cal.Rptr. 385, 494 P.2d 9 (1972), would not require Rectifier to pay more than one-third of any recovery in the main action to its former and present attorneys, and that to the extent that any trial court judgment for RM&S plus C&R’s fees exceeded that one-third, C&R would pay to RM&S from the escrowed 8%3% or $2.45 million, so much as was necessary to insure that Rectifier paid only a total of one-third for all attorneys’ fees to the conclusion of the main action. C&R also state that C&R’s 8/4% bonus fee “. . . would under no circumstances ever be paid to Rectifier, but upon final resolution of the expected RM&S suit, would be paid, in whole or in part, either to C&R or to RM&S,” by C&R’s and Rectifier’s instructions to the California Bank. On October 15, 1975, RM&S instituted suit in the Superior Court of the State of California in and for the County of Los Angeles (the “California trial court”) against Rectifier and C&R. RM&S’s first count was on the RM&S-Rectifier contingent fee contract and sought to recover the one-third contingent fee. RM&S’s second count alternatively sought quantum meruit. Both the first and second counts were against Rectifier only. RM&S’s third count alleged that C&R had wrongfully dissolved the at-will RM&S partnership and sought to recover all fees that Rectifier had paid to C&R — the annual $250,000 and the 8%% contingent bonus fee. The RM&S fourth and fifth counts pleaded that C&R had induced Rectifier to discharge RM&S and that Rectifier had induced C&R to dissolve the RM&S partnership, respectively. The RM&S case began trial in the California trial court in March 1980. At that time, all of RM&S’s counts had been dismissed except the quantum meruit count against Rectifier only and the separate inducement count against C&R only. In June 1980, the inducement count was dismissed by the California trial court by nonsuit at the close of RM&S’s case in chief. RM&S appealed therefrom and that appeal is pending in the District Court of Appeal of the State of California, Second Appellate District (the “California appeals court”). In July 1980, RM&S received a (approximately) $4.4 million jury verdict on the quantum meruit count, to which the California trial court added (approximately) $1.5 million in prejudgment interest and thereafter entered a total judgment for (approximately) $5.9 million. On the last day permitted for appeal, Rectifier appealed to the California appeals court from the $5.9 million judgment. After the time for a direct appeal had expired, but within the time provided for a cross appeal, RM&S appealed and protectively cross appealed from all previously dismissed counts but did not appeal from the $5.9 million judgment recovered against Rectifier on its second count. Thus, if Rectifier had not appealed on the last day, RM&S’s cross appeal thereafter would have been a nullity and the $5.9 million judgment would have become final for all purposes. On January 19, 1981, C&R demanded in writing that Rectifier instruct the California Bank to release the principal amount of the escrowed funds asserting that (1) the terms of the paragraph 4 indemnity so required because the $4.4 million RM&S judgment (with or without interest and with or without Rectifier’s reasonable fees, which were not covered by the indemnity) did not trigger the indemnity, and (2) the paragraph 4 indemnity by its terms, and as interpreted by California case law, ended the indemnity when a trial court judgment failed to reach and therefore to trigger the indemnity in whole or in part. On February 22, 1981, Rectifier refused in writing to instruct the California Bank to release the escrowed funds asserting that the paragraph 4 indemnity remained in effect even if RM&S was willing to accept a California trial court judgment and only Rectifier appealed to improve upon that judgment and even though Rectifier’s appeal could only benefit Rectifier. Rectifier further asserted that if its appeal resulted in a new trial and ultimately a larger judgment for RM&S which did reach the C&R indemnity, that C&R would then have to instruct the Security Bank to pay the es-crowed funds to RM&S, up to the whole thereof depending on the amount of the RM&S judgment. Secondly, Rectifier asserted that although the paragraph 4(a) indemnity did not cover any adverse result in the doxycycline case, paragraph 2.C.(1) requires that any monetary judgment against Rectifier in the doxycycline case, which occurred after the settlement of the main action, required a “recomputation” of C&R’s 8,4% bonus fee and that therefore C&R had impliedly also indemnified Rectifier against any future adverse judgment in the doxycycline case. Thus, according to Rectifier, if Pfizer were to recover a $33 million judgment against Rectifier in the ongoing doxycycline case, $33 million would be first deducted from the $33 million recovered by Rectifier in settlement of the main action, resulting in a zero net recovery in the main action and C&R’s 8%% bonus fee would be 8%% of zero. In addition, Rectifier asserted that all fees after the August 1975 settlement of the main action and which were thereafter paid to all counsel representing Rectifier in the doxycycline case, together with all costs incurred, would also reduce the $33 million recovered by settlement of the main action. Thus as Rectifier’s counsel explained it during a settlement discussion between the parties, and which this Court encouraged by its Order of June 4, 1981, the C&R 8%% or $2.45 million in escrowed funds, was an “indemnity-insurance policy” for any future adverse monetary judgment, and for all fees and costs incurred in the doxycycline case. It thus appears to be Rectifier’s position that (1) Rectifier can gamble C&R’s 8/i% bonus fee in an appeal and/or a retrial of the RM&S case and (2) that the C&R bonus fee was also intended to pay Rectifier’s attorneys’ fees and costs in the doxycycline case after the main action concluded and the C&R-Rectifier fee agreement also concluded in August of 1975, and that C&R also indemnified Rectifier against an adverse judgment in the doxycycline case. After the main ease settled in August 1975 and the Mutual of Omaha cases and the Union Health and Welfare cases settled in January-February 1976, the other two consolidated trial cases were also settled and the United States government’s civil case proceeded alone until a mistrial was declared by this Court on August 16, 1976, United States v. Pfizer, Inc., 4-71 Civil 403 (D.Minn.), In Re Coordinated Pretrial Proceedings in Antibiotic Antitrust Actions. CCH 1976-2 Trade Cases 69,774. On June 16, 1976, the Eighth Circuit Court of Appeals reversed this Court’s partial summary judgment in the doxycycline case, on the ground that there were triable issues of fact, and remanded the case for a trial of the factual issues presented thereby. At the time of the Eighth Circuit’s mandate, there was no broad spectrum antibiotic case pending before this Court, the United States’ case and the foreign government cases having been reassigned by the Multidistrict Panel to the District Court in Philadelphia. Thereafter, the doxycycline case was transferred by the Multidistrict Panel to the Central District of California to be consolidated and coordinated with another case against Pfizer Inc. pending in that district. Judge M. Pence of the District of Hawaii was assigned to sit in the Central District of California for those cases. In September of 1975, Rectifier and C&R orally agreed that C&R had fully performed the May. 16, 1974, C&R-Rectifier fee agreement, that the escrow instructions creating the escrow at the California , Bank would result in a final accounting between them not later than March 1, 1976, for C&R’s bonus fee of 8%% and that C&R’s bonus fee would be escrowed as security for C&R’s indemnity in the RM&S case. After September of 1975, Rectifier paid C&R an hourly rate pursuant to that oral agreement. In June 1980, the California District Court held the doxycycline patent to be valid. On November 11, 1980, Cohen and Ehrmann (successor to Cohen & Riordan) were substituted out of the doxycycline case at their request because of their refusal to be responsible for legal and strategy decisions which were being made contrary to their advice. On September 3, 1980, the California District Court issued a preliminary injunction enjoining Rectifier from further offering for sale or selling doxycycline. The transcript of that hearing, which the parties jointly submitted herein as an exhibit, shows that the District Court, in issuing that injunction, stated that if Pfizer Inc. could defeat the antitrust affirmative defense, which had not been tried, damages awarded against Rectifier might be more or less than $51 million, but would be “very, very substantial.” That Court said: They talk about $51 million, and I am not talking about $51 million. It may be more than that, it may be less than that. I am not here at this time necessarily [determining what] the damages of Pfizer might be. I simply say that it is a very, very substantial amount that potentially Pfizer [will] secure by way of judgment from Rectifier, if they are successful in surviving the attack on their [Pfizer’s] monopoly by virtue of the charges of misuse and abuse. Rectifier’s spokesman at that hearing, Mr. Blecher, conceded that a judgment in that amount or a fraction of that amount would bankrupt Rectifier. After that hearing, and after Cohen & Ehrmann withdrew from and were substituted out of the doxycycline case, and against Cohen’s advice and without C&R’s consent, (1) Rectifier voluntarily dismissed the antitrust affirmative defense; (2) voluntarily dismissed its pending appeal from the preliminary injunction; and (3) agreed to commence discovery on and to try the damage issues before the Court of Appeals decided the patent validity issues. The facts set forth above appear from the verified Petition and the affidavits filed on behalf of C&R in support of this Court’s ancillary jurisdiction and the Court’s temporary restraining orders and preliminary injunction. Rectifier has not filed an answer to the Petition nor has Rectifier filed any affidavit which relates to the factual basis for this Court’s ancillary jurisdiction or the factual basis for this Court’s temporary restraining orders or preliminary injunction. Neither party requested an evidentiary hearing on the order to show cause re preliminary injunction. Because Rectifier did not file any affidavit concerning the issues of ancillary jurisdiction or the issues of injunctive relief, there are no contested factual issues for this Court to resolve. Thus the Court accepts as true the facts which are stated in the C&R moving papers. Milton Roy Co. v. Bausch & Lomb Inc., 418 F.Supp. 975, 978 (D.Del.1978). To the extent that this Memorandum Opinion has and will address the merits, such discussion is limited to the present issues of ancillary jurisdiction and injunctive relief. See Minn. Ass’n of Health Care Facilities, etc., 602 F.2d 150, 155 (8th Cir. 1979). II. LEGAL DISCUSSION A. The Existence of This Court’s Ancillary Jurisdiction C&R urge that jurisdiction of the matter of attorneys’ fees may be sustained under the doctrine of federal ancillary jurisdiction. That very issue was considered at length in State of Iowa v. Union Asphalt & Roadoils Inc., 281 F.Supp. 391 (S.D.Iowa 1968), where the District Court said at pp. 396-99: The applicants urge that jurisdiction of the matter of attorney fees may be sustained by the doctrine of federal ancillary jurisdiction. The ancillary jurisdiction theory is relatively simple — once federal jurisdiction properly attaches to a primary case, the court also has jurisdiction over certain subsidiary or subordinate disputes even though it might not independently be able to proceed to adjudicate them .... In the situation at hand, the Court’s jurisdiction to fix attorney fees is generated by its auxiliary relation to the antitrust action by the State. . . . The precepts of the ancillary jurisdiction doctrine dictate that the federal courts should extend their jurisdiction to encompass orbital disputes subordinate to the principal action so that complete justice may be done.. .. Considerations of judicial economy and fairness to all parties underlie the ancillary jurisdiction theory. .. . And once jurisdiction has attached, it will generally continue until it has been fully exhausted. ... It would appear that the sound policies behind the doctrine and its elasticity would command the Court to retain jurisdiction over the auxiliary matter of attorney fees even though it entered a previous Order allowing the counsel to withdraw without such a condition. However, assuming that the process is irregular, the State has acquiesced in the retention of jurisdiction by this Court over the determination of fees. Thus, as a matter of law the Court has power to adjudicate the matter of attorney fees for applicants under federal ancillary jurisdiction, by amendment of its Order under Rule 60(b) and under its inherent power to correct orders, [emphasis added] In State of Iowa v. Union Asphalt & Roadoils, Inc., 409 F.2d 1239 (8th Cir. 1969), the Eighth Circuit affirmed the existence of and the exercise of ancillary jurisdiction by the Iowa District Court concerning the attorney-client fee dispute there involved, stating at pp. 1242-44: We observe preliminarily that the district court was vested with jurisdiction over the subject matter of the antitrust suit filed on December 6, 1966, out of which this controversy arose. Clayton Act Section 4 (15 U.S.C. § 15). The question which initially concerned Judge Hanson related to the court’s jurisdiction to adjudicate the fee controversy between appellees and their former client. The court engaged in an exhaustive review of the doctrine of federal ancillary jurisdiction, and documented its discussion with authorities which it deemed analogous in principle. 281 F.Supp. at 396. In view of the comprehensive exposition of the law by the district court we shall confine our discussion to the primary purpose of the doctrine of ancillary jurisdiction. 1 Barron and Holtzoff, Federal Practice and Procedure, Section 23 (Rules ed. 1960), often cited by the court, states: One of the most useful devices for mitigating the otherwise strict limitations of federal jurisdiction is the concept of “ancillary jurisdiction,” by which it is held that a district court acquires jurisdiction of a case or controversy as an entirety, and hence may, as an incident to disposition of a matter properly before it, possess jurisdiction to decide other matters raised by the cases of which it could not take cognizance were they independently presented. If the court has jurisdiction of the principal action, it also has cognizance of any ancillary proceeding therein, regardless of the citizenship of the parties, the amount in controversy or any other factor that would ordinarily determine jurisdiction. Ancillary jurisdiction exists because without it the court could neither effectively dispose of the principal case nor do complete justice in the premises. It is a common-sense solution of the problems of piecemeal litigation which otherwise would arise by virtue of the limited jurisdiction of federal courts. Forrester, Federal Jurisdiction and Procedure 294-95 (Dobie and Ladd, 2d ed., 1950) explains the theory and use of ancillary jurisdiction, as follows: The definitive statements of most legal authorities appear to found the doctrine of ancillary jurisdiction on the basic principles of justice, necessity and efficiency. Ancillary jurisdiction exists because of the relation of the incidental proceeding to the principal case over which original jurisdiction already exists. This relation alone creates and establishes such ancillary jurisdiction. See also Wright on Federal Courts, § 9, at 17 (1963); Fins, Federal Jurisdiction and Procedure 71-74 (1960); 21 C.J.S. Courts § 88 (1940). There is case law which, in our view lends support for the conclusion that the court had the power to resolve appellees’ claim under its ancillary jurisdiction. In National Equipment Rental, Ltd. v. Mercury Typesetting Co., 323 F.2d 784 (2d Cir. 1963), Caddy, the attorney, represented one of the litigants from June 13, 1961, until his discharge on January 29, 1963, during which period an action was brought in the United States district court. After his discharge Caddy filed a motion in the pending district court case seeking the fixing of fees and disbursements due him from his former client. Judge Lumbard observed: The law seems well settled that a federal district court may condition the substitution of attorneys in litigation pending before it upon the client’s either paying the attorney or posting security for the attorney’s reasonable fees and disbursements, as these may be determined. [Citing cases] This power resides in the federal court as ancillary to its conduct of the litigation. Id. at 786. In a footnote Judge Lumbard stated: The termination of relations between a party in litigation in a federal court and his attorney is a matter relating to the protection of the court’s own officers and is not subject to the doctrine of Erie Railroad Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188. Id. See also First Iowa Hydro Elec. Coop. v. Iowa-Illinois Gas & Elec. Co., supra [245 F.2d 613 (8th Cir.)]. Here, of course, the order of January 10, 1967, permitting appellees to withdraw was not conditioned upon the state of Iowa paying the attorneys or posting security. We do not believe the failure to enter a conditional order deprived the court of authority to entertain a subsequent motion by appellees and to grant such relief as was required to do full and complete justice. In our view, the order, interlocutory in nature as it was, did not have the legal effect of destroying jurisdiction which existed by force of law. We are satisfied that on this record power resided in the district court to adjudicate the disagreement between appellees and the attorney general of Iowa as ancillary to its jurisdiction over the principal action. As Judge Hanson’s opinion discloses, he also concluded that he had the authority under Rule 60(b), F.R.Civ.P., or under his inherent power to grant appellees relief. In view of our holding we find it unnecessary to consider or discuss these alternative theories, [emphasis added] The majority view, generated by the State of Iowa cases, supra, is that ancillary jurisdiction over attorney-client fee disputes is inherent and exists in the District Courts independent of jurisdiction conferred by statute, or statutory venue requirements or federal rules of procedure. In Re Hoy’s Claim, 93 F.Supp. 265-66 (D.Mass.1950); Moore Bros. Const. Co. v. City of St. Louis, 159 F.2d 586 (7th Cir. 1947); American Federation of Tobacco Growers Inc. v. Allen, 186 F.2d 590 (4th Cir. 1950); Grimes v. Chrysler Motors Corp., 565 F.2d 841 (2d Cir. 1977); Murphy v. Kodz, 351 F.2d 163 (9th Cir. 1965); Clark v. United States, 379 F.Supp. 1399 (N.D.Iowa 1974); National Equipment Rental Ltd. v. Mercury Typesetting Co., 323 F.2d 784 (2d Cir. 1963); City of Hankinson, North Dakota v. Otter Tail Power Co., 294 F.Supp. 249 (D.N.D.1969); John Griffiths & Son Co. v. United States, 72 F.2d 466 (7th Cir. 1934). Ice Projects Inc. v. World Hockey Ass’n, 443 F.Supp. 483, 487 (E.D.Pa.1977). As the Court said in State of Iowa, at 281 F.Supp. 396: The ancillary jurisdiction theory is relatively simple — once federal jurisdiction properly attaches to a primary case, the court also has jurisdiction over certain subsidiary and subordinate disputes even though it might not independently be able to proceed to adjudicate them. In the attorney-client fee dispute presented by the C&R Petition, it cannot be disputed that this Court had subject matter jurisdiction over the main action which was an antitrust case brought by Rectifier and its subsidiary corporations under the federal antitrust laws against American Cyanamid Company, Pfizer Inc., Bristol-Myers Company, E.R. Squibb & Sons, Inc., and the Upjohn Company (“under and pursuant to Sections 4,12 and 16 of the Clayton Act (U.S.C. Sections 15, 22 and 26) to secure . . . relief [under] Sections 1 and 2 of the Sherman Act (15 U.S.C. Sections 1 and 2) and Section 3 of the Clayton Act (15 U.S.C. Section 14).”) Where the Court has subject matter jurisdiction over the main action, its ancillary jurisdiction is inherent and considerations of removal jurisdiction, diversity, pendent jurisdiction and venue are inherent. Travis v. Anthes Imperial Limited, 473 F.2d 515, 528-29 (8th Cir. 1973): At the outset, we note that for practical purposes, our decision with respect to subject matter jurisdiction also decides the question of venue. Accord, Continental Grain etc. v. Oil Seeds Inc., 592 F.2d 409, 422 (8th Cir. 1979). Rectifier argues that ancillary jurisdiction expired when the main action was settled and dismissed with prejudice and that ancillary jurisdiction does not exist six years after that event. Rectifier emphasizes the dismissal was with prejudice and without attorneys’ fees or costs. Such dismissals cannot oust the Court of ancillary jurisdiction and has no bearing on whether the Court has ancillary jurisdiction. Schmidt v. Zazzara, 544 F.2d 412, 414 (9th Cir. 1976): Zazzara first argues that the district court erred in retaining jurisdiction over the question of attorney’s fees after the consent judgment had been entered. We do not agree. Allowance of attorney’s fees “is part of the historic equity jurisdiction of the federal courts.” Sprague v. Ticonic Bank, 1939, 307 U.S. 161, 164, 59 S.Ct. [777], 779, 83 L.Ed. 1184, and the district court could properly retain jurisdiction to determine appropriate attorney’s fees ancillary to the case .... It was “not necessary to relegate Plaintiff to a separate action to recover fees.” Likewise, Zazzara claims that the award was beyond the district court’s jurisdiction because of the clause in the consent judgment requiring “each party to bear its own costs and attorneys fees” is without merit. Ancillary jurisdiction does not depend on the pendency of the main action, but exists both during and after the main action for the same policy reasons which determine whether the court should exercise that jurisdiction and entertain the Petition. Sprague v. Ticonic Bank, 307 U.S. 161, 59 S.Ct. 777, 83 L.Ed. 1184 (1939); State of Iowa v. Union Asphalt & Roadoils Inc., 281 F.Supp. 391 (S.D.Iowa 1968), aff’d 409 F.2d 1239 (8th Cir. 1969); American Federation of Tobacco Growers Inc. v. Allen, 186 F.2d 590 (4th Cir. 1951); John Griffiths & Son Co. v. United States, 72 F.2d 466 (7th Cir. 1934); In Re Hoy’s Claim, 93 F.Supp. 265 (D.Mass.1950). It would be anomalous if federal ancillary jurisdiction existed to protect the plaintiff’s attorney who was discharged during the pendency of the main action but did not exist to protect the plaintiff’s attorney who successfully settled and dismissed the main action for the plaintiff in the main action and thereafter became involved in a fee dispute with that plaintiff. Such is not the law. Ancillary jurisdiction was exercised after the main action concluded in Schmidt v. Zazzara, supra; In Re Hoy’s Claim, supra; and Moore Bros. Const. Co. v. City of St. Louis, 159 F.2d 586 (7th Cir. 1974). If ancillary jurisdiction exists, the District Court need not resort to the procedural device of amending the judgment in the main action or vacating and reinstating that judgment. State of Iowa v. Union Asphalt & Roadoils Inc., supra. Ancillary jurisdiction is not dependent on procedural devices afforded by the Federal Rules of Civil Procedure. Ibid. Attorney-client fee disputes within the Court’s ancillary jurisdiction are best determined after the main action is concluded in order not to interfere with or delay the prosecution of the main action. Moore v. Telfon Communications Corp., 589 F.2d 959 (9th Cir. 1978). Ancillary jurisdic tion exists not only to fix the attorneys’ fee but also to resolve any attorney-client contractual fee dispute. City of Hankinson, North Dakota v. Otter Tail Power Co., 294 F.Supp. 249 (D.N.D.1969); John Griffiths & Son Co. v. United States, 72 F.2d 466 (7th Cir. 1934); Farmington Dowel Products v. Forster Mfg. Co., 421 F.2d 61 (1st Cir. 1969). In the present case, C&R seek release of their escrowed funds on the ground that the paragraph 4 indemnity has been exonerated by subsequent events. Alternatively C&R allege that Rectifier has repudiated the May 16, 1974, fee agreement which entitles them to elect quantum meruit. C&R also plead additional alternative counts for rescission and fraud. This Court should not resolve those issues on the merits at this preliminary stage of the proceedings. Chicago Great Western Ry. Co. v. Chicago, B&Q R. Co., 193 F.2d 975 (8th Cir. 1952): The other contentions urged on behalf of defendant go to the merits of the controversy between the parties. These issues are substantial and cannot properly be determined in advance of the trial of the case on its merits.... [C]ounsel for defendant has briefed and argued the issues as if they had been determined on the merits and insist that we determine them on this appeal. This we must decline to do. The application here was addressed to the judicial discretion of the court. . . . Orderly procedure in the circumstances here disclosed required that the parties try this case on its merits before attempting to present to this court the issues going to the merits of the action. Id. at 978. Rectifier also argues that the side letter of August 12, 1975, evidences the intent of both Rectifier and C&R to waive ancillary jurisdiction over future attorney-client fee disputes. C&R assert by verified Petition and by affidavit that the side letter was intended to “reserve and preserve” ancillary jurisdiction over future attorney-client fee disputes while at the same time terminate ancillary jurisdiction to the extent that the exercise thereof would involve any of the antitrust defendants or affect the finality of the settlement and dismissal of the main action. Both parties agree that Rectifier and the antitrust defendants could not confer subject matter jurisdiction or ancillary jurisdiction upon the court. See State of Iowa v. Union Asphalt and Roadoils, Inc., supra. Similarly, the parties could not limit the Court’s jurisdiction or deprive the Court of existing jurisdiction. Thus the parties’ intent in attempting to preserve or waive the Court’s ancillary jurisdiction is addressed to the Court’s discretionary exercise of that jurisdiction rather than to the existence of jurisdiction itself. Consequently, the side letter will be considered in discussing the factors which militate in favor of and against the exercise of ancillary jurisdiction. However, before considering that question of the discretionary exercise of jurisdiction, the Court notes that Rectifier argues that: The letter clearly states that the settlement agreement and stipulation to dismiss the main action were not “intended to affect one way or another whether” this Court is to have continuing jurisdiction to resolve attorney’s fee claims against Rectifier. Rectifier thus concedes that the issue is not inherent jurisdiction, but rather the discretionary exercise thereof. Rectifier cites Bounougias v. Peters, 369 F.2d 247, 249 (7th Cir. 1966); Minersville Coal Co. Inc. v. Anthracite Export Ass’n, 55 F.R.D. 429 (M.D.Pa.1972) and Adams v. Allied Chemical Corp., 503 F.Supp. 253 (E.D.Va.1980); for the proposition that this Court does not have ancillary jurisdiction. Bounougias, Minersville, and Adams represent the minority view that an attorney-client dispute is ipso facto collateral and independent of the main action and therefore has no “direct connection” to the main action upon which to predicate ancillary jurisdiction. Bounougias and its progeny rely on the absence of a “direct relation” for ancillary jurisdiction, quoting Fulton National Bank of Atlanta v. Hozier, 267 U.S. 276, 45 S.Ct. 261, 69 L.Ed. 609 (1925), and conclude that all attorney-client fee disputes do not have that “direct relation.” The majority view espoused by State of Iowa, supra, (and the cases following State of Iowa, supra) hold that the “direct relation” does exist for attorney-client disputes. In Grimes v. Chrysler Motors Corp., 565 F.2d 841 (2d Cir. 1977), the Second Circuit also cited Fulton National Bank of Atlanta v. Hozier in support of the majority view stating: Although the exact jurisdictional question involved in this suit rarely arises there is ample authority to support the general proposition that: A district court acquires jurisdiction of a case or controversy as an entirety, and may, as an incident to the disposition of a matter properly before it, possess jurisdiction to decide other matters raised by the case of which it could not take cognizance were they independently presented. . .. The Supreme Court has established that the exercise of ancillary jurisdiction is appropriate where the subsidiary controversy, “has direct relation to property or assets actually or construe-: tively drawn into the court’s possession or control by the principal suit.” Fulton National Bank of Atlanta v. Hozier . .. Under these standards, the District Court’s distribution of the Grimes settlement funds and its determination of appropriate disbursements was clearly ancillary. . . . ” Cases such as Fulton, supra, and United Mineworkers v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1936) (cited by Rectifier), were concerned with the scope of pendent jurisdiction, not ancillary jurisdiction, and are analogous only insofar as the policy considerations of judicial economy and convenience and economy to the parties is common, but are not otherwise applicable because the other pendent jurisdiction considerations are different from the reasons for the existence of and the exercise of ancillary jurisdiction. For pendent jurisdiction a “direct connection” exists if the state claims are involved in the federal claims and must, will, or should be decided in one court and without burdening the federal court with side issues. Ancillary jurisdiction, however, is based upon the strong federal policy reasons discussed below. This Court must follow the majority rule established by the Eighth Circuit in State of Iowa, supra, which is the majority view and the better rule of law. Neither Bounougias, supra, nor any of its offspring involved a situation where the main case was a federal antitrust case and the policy of Section 4 of the Clayton Act or the federal policy of inherent equity jurisdiction to protect attorneys’ rights to fees under Sprague v. Ticonic Bank, supra, was brought to bear to support the discretionary exercise of ancillary jurisdiction. This Court determines that it does have ancillary jurisdiction and will now consider the discretionary exercise of that jurisdiction. B. The Considerations Controlling This Court's Exercise of Ancillary Jurisdiction Ancillary jurisdiction should be entertained if the following policy considerations tip the balance in the petitioner’s favor: (1) effectuating the private attorney general policy of Section 4 of the Clayton Act; (2) assuring the just, expeditious and economical resolution of attorney-client fee disputes; and (3) protecting the attorneys who are officers of the Court from expensive and protracted state court proceedings. (1) To effectuate the private attorney-general policy of Section 4 of the Clayton Act. If the main action is a federal antitrust case, policy favors effectuating the private attorney-general policy of Section 4 of the Clayton Act by awarding the plaintiff’s attorneys the agreed fee or a reasonable fee, if the plaintiff’s attorney is entitled thereto, without the delay and expense occasioned by a state court action. The policy of Section 4 requires that the antitrust defendants pay the successful plaintiff’s attorneys a reasonable fee in order to encourage attorneys to act as private attorneys-general in enforcing the antitrust laws. The reasonableness of that fee, whether contractual between the parties, or fixed by the Court, or in combination, is within the subject matter jurisdiction of the Court that tried the main antitrust case. Farmington Dowel Products Co. v. Forster Mfg. Co., 421 F.2d 61, 86-92 (1st Cir. 1969); In Re Uranium Antitrust Litigation, 617 F.2d 1248, 1261 (7th Cir. 1980); Perma Life Mufflers v. International Parts Corp., 392 U.S. 134, 88 S.Ct. 1981, 20 L.Ed.2d 982 (1968). That same policy re quires that the Court exercise its ancillary jurisdiction over an attorney-client fee dispute where the Court can resolve the fee dispute more expeditiously and economically than would be the case if the parties were relegated to a state court action. American Federation of Tobacco Growers, Inc. v. Allen, supra: Plaintiff may not include such fees in the settlement and then ignore the rights of counsel therein. It is argued that the controversy over fees is one which the parties should settle in the state courts as there is no diversity of citizenship; but the controversy is ancillary to the handling of a case in the federal court, the attorney who alleges that he has been mistreated is an officer of the court . .. and the controversy relates to funds received by a party in settlement of the case... . As noted above, the $33 million paid to Rectifier by the antitrust defendants included an unspecified amount for attorneys’ fees. Nor is it disputed that if C&R or Rectifier brought this suit in the California trial court it would take almost five years to come to trial because of the congested trial calendar in that Court. This Court can act with the far greater expedition that Section 4 requires, and for which ancillary jurisdiction exists. Attorneys who act as p