Jason M. Yamada, D.D.S., on behalf of himself and others similarly situated, Plaintiff-Appellee,
Nobel Biocare Holding AG; Nobel Biocare AB; Nobel Biocare USA, LLC, Defendants-Appellants.
Argued and Submitted February 12, 2016 -Pasadena, California
Appeal from the United States District Court D.C. No. 2:10-cv-04849-MWF-PLA for the Central District of California Michael W. Fitzgerald, District Judge, Presiding
Eric Y. Kizirian (argued) and Michael K. Grimaldi, Lewis Brisbois Bisgaard & Smith LLP, Los Angeles, California; Jeffry A. Miller, Lewis Brisbois Bisgaard & Smith LLP, San Diego, California, for Defendants-Appellants.
Myron Moskovitz (argued), Piedmont, California; William M. Audet, and Jonas P. Mann, Audet & Partners, LLP, San Francisco, California, for Plaintiff-Appellee.
Before: Marsha S. Berzon and John B. Owens, Circuit Judges, and Algenon L. Marbley, [*] District Judge
The panel vacated the district court's order awarding class counsel more than $2.3 million in attorneys' fees, which the district court awarded based on the terms of a settlement agreement, California Code of Civil Procedure § 1021 under the substantial benefit theory, and the private attorney general theory under California Code of Civil Procedure § 1021.5; and remanded.
Dr. Jason Yamada, a dentist, filed a class action complaint against defendants Nobel Biocare AG, and related entities, alleging defects in the NobelDirect implants.
The lodestar method (calculated by multiplying the number of reasonable hours the prevailing party expended by a reasonable hourly rate for the region and for the attorneys' experience) may be used in certain class actions to calculate attorneys' fees. The court may adjust the lodestar figure by an appropriate upward or negative multiplier reflecting a host of "reasonableness" factors.
The panel held that defendants did not waive their due process argument. The panel also held that the district court's use over defendants' objection of ex parte, in camera submissions to support its fee order violated defendants' due process rights. On remand, the panel held that the district court must allow defendants access to timesheets, appropriately redacted to remove privileged information, so they can inspect them and present whatever objections that they might have concerning the fairness and reasonableness of plaintiffs' fee request.
The panel held that the district court's discount of the lodestar for lack of success was not erroneous because the district court concisely and clearly explained its reduction of the lodestar, and because there was sufficient support for its finding that plaintiffs' claims were related to a common goal. The panel also held that the district court's cross-check of the lodestar was entirely discretionary where, as here, classwide benefits were not easily monetized.
MARBLEY, District Judge:
Defendants-Appellants Nobel Biocare Holding AG, Nobel Biocare AB, and Nobel Biocare USA, LLC (collectively, "Nobel") appeal the district court's order awarding class counsel more than $2.3 million in attorneys' fees. Defendants appeal on four bases. First, they contend that the district court violated their due process rights by basing its fee order on an ex parte, in camera review of timesheets that they could not review or challenge. Second, they argue that the district court did not adequately discount the lodestar. Third, they assert that the district court's crosscheck of the lodestar was flawed. Finally, they submit that the district court erred in awarding a multiplier based solely on the contingent risk factor of the litigation. Plaintiffs argue that Defendants have waived the first argument by failing to raise the issue timely or adequately.
We find that Defendants have not waived their due process argument, and we vacate the district court's fee order and remand with instructions.
Named Plaintiff Dr. Jason Yamada, DDS is a Torrance, California-based dentist specializing in tooth implants. Dr. Yamada attended a promotional symposium in 2004 hosted by Nobel featuring their NobelDirect dental implants. Following the symposium, Dr. Yamada implanted dozens of NobelDirect implants into his patients but noticed that the implants failed at a rate he deemed unusually high. Just over a year after the implant's launch, two Swedish professors at the University of Gothenburg warned that the implants were causing bone loss, and they urged Nobel to withdraw the implants from the market. In response to those allegations, Nobel contacted the Swedish Medical Products Agency ("SMPA"), a government agency akin to the United States Food and Drug Administration, to investigate. In February of 2008, the SMPA formally closed its investigation with no adverse findings as to the implants' safety or efficacy. Nevertheless, at least a dozen of Dr. Yamada's ...