Lawyers challenge US$ 78 million fee award in T-Mobile data breach settlement

Lawyers opposing a US$ 78 million legal fee stemming from a class action settlement with T-Mobile urged the US Court of Appeals for the Eighth Circuit to overturn the award, arguing it constituted an excessive portion of the US$ 350 million settlement fund.

"This is exactly the kind of case that causes the public to scoff at class actions,” stated lawyer Robert Clore before the St. Louis-based appeals court. “My client gets 25 bucks, and these attorneys are walking away with US$ 7,000 to US$ 10,000 per hour.” The 2022 settlement addressed privacy claims from an estimated 76 million T-Mobile customers whose personal information was compromised in a data breach the previous year.

Reuters reported that a Kansas City, Missouri judge approved the settlement, which allocated 22.5 percent of the US$ 350 million fund for class attorneys’ fees, despite objections from challengers at the lower court. During the hearing, the three-judge panel questioned both parties to determine if the objections were made in "bad faith" or were legitimate concerns regarding the fee award's excessiveness.

Class attorney Bradley Wilders countered that the objectors were "serial" class action challengers motivated by financial self-interest. In an earlier filing, Wilders stated that class counsel had invested over 9,100 hours in the litigation. “Of the more than 76 million Class members, only two appealed,” Wilders said.

John Pentz, another attorney challenging the fee amount, expressed dissatisfaction with the trial court's treatment of objectors. In an email, he remarked that the trial court was "hostile to objectors rather than welcoming them."

The panel's scrutiny of the fee award included probing the balance between compensation for legal efforts and the equitable distribution of the settlement fund to the affected class members. The case draws attention to broader issues of transparency and fairness in class action settlements, particularly when substantial sums are awarded to attorneys while individual claimants receive relatively modest payouts.